Document:

exh10_4.htm

     

    
      

      

    

     

    
      EXECUTION
COPY

       

      FIFTH
AMENDMENT TO RECEIVABLES LOAN AND SECURITY AGREEMENT

       

      THIS
FIFTH AMENDMENT TO THE RECEIVABLES LOAN AND SECURITY AGREEMENT, dated as of May
23, 2008 (this “Amendment”), is
entered into by RESOURCE CAPITAL FUNDING II, LLC (the “Borrower”), LEAF
FINANCIAL CORPORATION (the “Servicer”) and MORGAN
STANLEY BANK (“Morgan
Stanley”), as a Lender (the “Lender”).

       

      R E C I T A L S

       

      A.           The
Borrower, the Servicer, Morgan Stanley, U.S. Bank National Association and Lyon
Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services) are parties to the
Receivables Loan and Security Agreement, dated as of October 31, 2006 (as
amended, supplemented or otherwise modified from time to time, the “Agreement”);

       

      B.           The
parties hereto desire to amend the Agreement on the terms and conditions set
forth herein.

       

      NOW THEREFORE, for good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:

       

      1.           Certain Defined
Terms.  Capitalized terms used but not defined herein shall
have the meanings set forth for such terms in Section 1.01 of the
Agreement.

       

      2.           Amendments to the
Agreement.  The Agreement is hereby amended to incorporate the
changes reflected on Exhibit A
hereto.

       

      3.           Conditions
Precedent.  The effectiveness of this Amendment is expressly
conditioned upon the receipt by Morgan Stanley of (i) executed signature pages
to this Amendment from each of the parties hereto, (ii) executed signature pages
to that certain Amended and Restated Fee Letter, dated as of the date hereof,
between the Borrower and Morgan Stanley (the “Fee Letter”) from
each of the parties thereto, (iii) executed signature pages to that certain No
Proceedings Letter Agreement, dated as of the date hereof, among LEAF Commercial
Finance Fund, LLC (“LEAF Commercial”),
each of the parties hereto, U.S. Bank National
Association and Lyon Financial Services, Inc. (d/b/a U.S. Bank Portfolio
Services) from each of the parties thereto, (iv) executed signature pages to
Third Amendment to Purchase and Sale Agreement, dated as of the date hereof,
between the Borrower and the Originator from each of the parties thereto, (v)
payment by the Borrower of the First Installment under and as defined in the Fee
Letter, (vi) favorable legal opinions and/or reliance letters of Thacher
Proffitt & Wood LLP, counsel to the Borrower and LEAF Commercial, with
respect to certain bankruptcy matters in form and substance satisfactory to
Morgan Stanley and (vii) such other documents, instruments and opinions as
Morgan Stanley may request.

       

      4.           Representations and
Warranties.  Each of the Borrower and the Servicer represents
and warrants to Morgan Stanley that:

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

      (a)           this
Amendment has been duly authorized, executed and delivered on its behalf, and
the Agreement, as so amended, constitutes its legal, valid and binding
obligation enforceable against it in accordance with the terms hereof or
thereof;

       

      (b)           the
representations and warranties made by it in the Agreement (as amended by this
Amendment) are true and correct as of the date hereof (except to the extent such
representations and warranties speak as a prior date or have been the subject of
any prior notice or waiver); and

       

      (c)           after
giving effect to this Amendment, no Program Termination Event, Event of Default,
or Unmatured Event of Default shall exist on the date hereof.

       

      5.           Effect of
Amendment.  Except as expressly amended and modified by this
Amendment, all provisions of the Agreement shall remain in full force and
effect.  After the date hereof, all references in the Agreement to
“this Agreement”, “hereof”, or words of similar effect referring to the
Agreement shall be deemed to be references to the Agreement as amended by this
Amendment.  This Amendment shall not be deemed to expressly or
impliedly waive, amend or supplement any provision of the Agreement other than
as set forth herein.

       

      6.           Counterparts.  This
Amendment may be executed in any number of counterparts and by different parties
on separate counterparts (including by facsimile or electronic transmission),
each of which shall be deemed to be an original and all of which when taken
together shall constitute but one and the same instrument.

       

      7.           Governing Law;
Severability.  THIS AMENDMENT SHALL BE A CONTRACT MADE UNDER
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO ITS
CONFLICTS OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW).  Wherever possible each provision of this Amendment
shall be interpreted in such manner as to be effective and valid under
applicable laws, such provision shall be ineffective to the extent of such
prohibition or invalidity, without invalidating the remainder of such provision
or the remaining provisions of this Amendment.

       

      8.           Section
Headings.  The various headings of this Amendment are included
for convenience only and shall not affect the meaning or interpretation of this
Amendment, the Agreement or any provision hereof or thereof.

       

      9.           Continued
Effectiveness.  Except as specifically provided herein, the
Agreement shall remain unmodified and is specifically confirmed to be in full
force and effect.  Upon the effectiveness of this Amendment, all
references in the Agreement and in the other Transaction Documents to the
Agreement or the like shall refer to the Agreement as hereby
amended.

       

      [Signature
pages follow]

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

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

       

       

      
        	
                THE
      BORROWER:

              	
                RESOURCE
      CAPITAL FUNDING II, LLC

                By:______________________________

                Name:

                Title:

              
	 	 
	
                THE
      SERVICER:

              	
                LEAF
      FINANCIAL CORPORATION

                By:______________________________

                Name:

                Title:

              
	 
      	 
      

      

      
      

       

       

      
        
          
          

        

        
          S-1

          
            

          

        

        
          
          

        

      

       

      
         

         

        
        

        
          	
                  THE
      LENDER:

                	
                  MORGAN
      STANLEY BANK

                  By:______________________________

                  Name:

                  Title:

                   

                

        

         

      

       

       

       

      
        
          
          

        

        
          S-2

          
            

          

        

        
          
          

        

      

       

       

      Exhibit
A

      

       

      
         

        
          
            
            

          

          
            Exh.
A

            
              

            

          

          
            
            

          

        

      
         [incorporates
First Amendment, dated as

        of
December 21, 2006, Second Amendment,

        dated as
of February 28, 2007, Third

        Amendment,
dated as of September 28, 2007 and2007,

        Fourth
Amendment, dated as of December 27, 20072007,

        Consent to Receivables Loan and Security Agreement

        and Custodial Agreement, dated May 9, 2008,

        and Fifth Amendment, dated as of May
23, 2008]

        
          

           

           

          U.S.
$250,000,000

          

        

        RECEIVABLES
LOAN AND SECURITY AGREEMENT

         

        Dated as
of October 31, 2006

         

        Among

         

        RESOURCE
CAPITAL FUNDING II, LLC,

         

        as the
Borrower

         

        and

         

        LEAF
FINANCIAL CORPORATION,

         

        as the
Servicer

         

        and

         

        MORGAN
STANLEY BANK,

         

        as a Lender and Collateral
Agent

         

        and

         

        U.S. BANK
NATIONAL ASSOCIATION,

         

        as the Custodian and the
Lender’s Bank

         

        and

         

        LYON
FINANCIAL SERVICES, INC. (D/B/A U.S. BANK PORTFOLIO SERVICES),

         

        
          as the Backup
Servicer

           

          
            
              
              

            

            
              
              

              
                

              

            

            
              
              

            

          

          

        

        This
RECEIVABLES LOAN AND SECURITY AGREEMENT is made as of October 31, 2006,
among:

         

        (1)           RESOURCE
CAPITAL FUNDING II, LLC, a Delaware limited liability company (the “Borrower”);

         

        (2)           LEAF
FINANCIAL CORPORATION, a Delaware corporation (“LEAF Financial” or
the “initial
Servicer”), as the Servicer (as defined herein);

         

        (3)           MORGAN
STANLEY BANK (“Morgan
Stanley”), as a Lender and Collateral Agent (as defined
herein);

         

        (4)           U.S.
BANK NATIONAL ASSOCIATION, as the Custodian and the Lender’s Bank (as each such
term is defined herein); and

         

        (5)           LYON
FINANCIAL SERVICES, INC. (d/b/a U.S. Bank Portfolio Services), a Minnesota
corporation, as the Backup Servicer (as defined herein).

         

        IT IS
AGREED as follows:

         

        
          	
                   
      

                	
                  ARTICLE
      I.

                

        

         

        

         

        
          	
                   
      

                	
                  DEFINITIONS

                

        

         

        SECTION
1.01  Certain Defined
Terms.  a) Certain capitalized terms used throughout this
Agreement are defined above or in this Section 1.01.

         

        (b)  As
used in this Agreement and the exhibits and schedules thereto (each of which is
hereby incorporated herein and made a part hereof), the following terms shall
have the following meanings (such meanings to be equally applicable to both the
singular and plural forms of the terms defined):

         

        “Accountants’ Report”
has the meaning assigned to that term in Section 6.11(b).

         

        “Active Backup Servicer’s
Fee” means, for any Fee Period or portion thereof after the occurrence of
a Servicer Default and the appointment of the Backup Servicer as Servicer
hereunder, an amount, payable out of Collections on the Pledged Receivables and
amounts applied to the payment of, or treated as payments on, the Pledged
Receivables, equal to the greater of (i) the Active Backup Servicing Fee Rate,
multiplied by the Net Eligible Receivables Balance as of the first day of such
Fee Period, multiplied by a fraction, the numerator of which shall be the actual
number of days in such Fee Period and the denominator of which shall be 360, and
(ii) $5,000.  The Active Backup Servicer’s Fees shall also include
reasonable out-of-pocket expenses incurred by the Backup Servicer in performing
its duties as Servicer.

         

        “Active Backup Servicing Fee
Rate” means 1.00%.

         

        “Active Backup Servicer’s
Indemnified Amounts” has the meaning assigned to that term in
Section 6.09.

         

        “Adjusted Eurodollar
Rate” means, with respect to any Interest Period for any Loan allocated
to such Interest Period, an interest rate per annum equal to the sum of
(i) the Adjusted Eurodollar Rate Margin and (ii) an interest rate per
annum equal to the average of the interest rates per annum (rounded upwards, if
necessary, to the nearest 1/16 of 1%) reported during such Interest Period on
Telerate Access Service Page 3750 (British Bankers Association Settlement Rate)
as the London Interbank Offered Rate for United States dollar deposits having a
term of thirty (30) days and in a principal amount of $1,000,000 or more (or, if
such page shall cease to be publicly available or, if the information contained
on such page, in the Lender’s sole judgment, shall cease to accurately reflect
such London Interbank Offered Rate, such rate as reported by any publicly
available recognized source of similar market data selected by the Lender that,
in the Lender’s reasonable judgment, accurately reflects such London Interbank
Offered Rate).

         

        
          
            
            

          

          
            
            

            
              

            

          

          
            
            

          

        

        “Adjusted Eurodollar Rate
Margin” has the meaning ascribed thereto in the Fee Letter.

         

        “Adverse Claim” means
a lien, security interest, charge, encumbrance or other right or claim of any
Person other than, with (i) respect to the Pledged Assets, any lien,
security interest, charge, encumbrance or other right or claim in favor of the
Collateral Agent or (ii) any Permitted Lien.

         

        “Affected Party” has
the meaning assigned to that term in Section 2.09.

         

        “Affiliate” when used
with respect to a Person, means any other Person controlling, controlled by or
under common control with such Person.  For the purposes of this
definition, “control,” when used with respect to any specified Person, means the
power to direct the management and policies of such Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

         

        “Agreement” means this
Receivables Loan and Security Agreement, as the same may be amended, restated,
supplemented and/or otherwise modified from time to time hereafter in accordance
with its terms.

         

        “Allonge” means an
allonge in the form attached hereto as Exhibit G.

         

        “Amortized Equipment
Cost” means, as of any date of determination, (i) for any
Pool A Receivable, the net investment with respect to such Pool A
Receivables, where “net investment” means (a) the present value of the
remaining Scheduled Payments under the related Contract, discounted at the rate
at which the present value of all Scheduled Payments under the related Contract,
including any Balloon Payment or Put Payment, equals the original equipment cost
related to such Receivable, plus (b) the associated amortized indirect
costs related to the applicable equipment, amortized using the interest method
over the life of the related Contract and (ii) for any Pool B
Receivable, the net investment with respect to such Pool B Receivable,
where “net investment” means (a) the sum of the present values of the
remaining Underlying Scheduled Payments under each related Eligible Underlying
Contract, discounted at the rate at which the present value of all scheduled
payments under such Eligible Underlying Contract, including any Balloon Payment
or Put Payment, equals the original equipment cost related to such Eligible
Underlying Contract, plus (b) the associated amortized indirect costs
related to the applicable equipment, amortized using the interest method over
the life of the related Underlying Contract.

         

        “Annualized Default
Rate” means, as of any date of determination after the end of the first
Collection Period following the date hereof, an amount (expressed as a
percentage) equal to (i) the product of (A) the aggregate Discounted
Balances of all Pledged Receivables which were Eligible Receivables at the time
of their Pledge hereunder and which became Defaulted Receivables during the six
(or such lesser number of Collection Periods since the date hereof) immediately
preceding Collection Periods and (B) 2 (if six or more Collection Periods
have occurred since the date hereof), 2.4 (if five Collection Periods have
occurred since the date hereof), 3 (if four Collection Periods have
occurred since the date hereof), 4 (if three Collection Periods have
occurred since the date hereof), 6 (if two Collection Periods have occurred
since the date hereof) or 12 (if one Collection Period has occurred since
the date hereof) divided by (ii) the average Eligible Receivables Balance
as of the first Business Day of each of the six (or such lesser number of
Collection Periods since the date hereof) immediately preceding Collection
Periods.

         

        “Annualized Net Loss
Rate” means, as of any date of determination after the end of the first
Collection Period following the date hereof, an amount (expressed as a
percentage) equal to (i) the product of (A) (x) the aggregate
Discounted Balances of all Pledged Receivables which were Eligible Receivables
at the time of their Pledge hereunder and which became Defaulted Receivables
during the six (or such lesser number of Collection Periods since the date
hereof) immediately preceding Collection Periods minus
(y) Recoveries received during the six (or such lesser number of Collection
Periods since the date hereof) immediately preceding Collection Periods and
(B) 2 (if six or more Collection Periods have occurred since the date
hereof), 2.4 (if five Collection Periods have occurred since the date
hereof), 3 (if four Collection Periods have occurred since the date
hereof), 4 (if three Collection Periods have occurred since the date
hereof), 6 (if two Collection Periods have occurred since the date hereof)
or 12 (if one Collection Period has occurred since the date hereof) divided
by (ii) the Eligible Receivables Balance as of the first Business Day of
the six (or such lesser number of Collection Periods since the date hereof)
immediately preceding Collection Periods.

         

        
          
            
            

          

          
            2

            
              

            

          

          
            
            

          

        

        “Applicable Date” has
the meaning set forth in definition of Pool B Annualized Net Loss
Rate.

         

        “Approved Lienholder”
means any Person that (i) has entered into a Nominee Lienholder Agreement, a
copy of which has been delivered by the Collateral Agent to the Custodian and
(ii) appears on the list of approved lienholders provided by LEAF Financial
Corporation to the Custodian from time to time.

         

        “Assigned Documents”
has the meaning assigned to that term in Section 2.10.

         

        “Assignment” has the
meaning set forth in the Purchase and Sale Agreement.

         

        “Assignment and
Acceptance” has the meaning assigned to that term in Section 9.04.

         

        “Available Funds” has
the meaning assigned to that term in Section 2.04(c).

         

        “Backup Servicer”
means Lyon Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services) or any
successor Backup Servicer appointed by the Lender pursuant to Section 6.13.

         

        “Backup Servicer Delivery
Date” has the meaning assigned to that term in Section 6.10(d).

         

        “Balloon Payment”
means a payment due, or which may be required, at the end of the term of a
Contract or Underlying Contract (which constitutes a loan) equal to the
principal amount under such Contract or Underlying Contract which remains
outstanding after the payment of all regular scheduled payments of principal
during the term of such Contract or Underlying Contract.

         

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

         

        “Bankruptcy Event”
shall be deemed to have occurred with respect to a Person if
either:

         

        (a)(c)  a case
or other proceeding shall be commenced, without the application or consent of
such Person, in any court, seeking the liquidation, reorganization, debt
arrangement, dissolution, winding up, or composition or readjustment of debts of
such Person, the appointment of a trustee, receiver, custodian, liquidator,
assignee, sequestrator or the like for such Person or all or substantially all
of its assets, or any similar action with respect to such Person under any law
relating to bankruptcy, insolvency, reorganization, winding up or composition or
adjustment of debts, and such case or proceeding shall continue undismissed, or
unstayed and in effect, for a period of 60 consecutive days; or an order for
relief in respect of such Person shall be entered in an involuntary case under
the federal bankruptcy laws or other similar laws now or hereafter in effect;
or

         

        (b)(d)  such
Person shall commence a voluntary case or other proceeding under any applicable
bankruptcy, insolvency, reorganization, debt arrangement, dissolution or other
similar law now or hereafter in effect, or shall consent to the appointment of
or taking possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator (or other similar official) for such Person or for any substantial
part of its property, or shall make any general assignment for the benefit of
creditors, or shall fail to, or admit in writing its inability to, pay its debts
generally as they become due, or, if a corporation or similar entity, its board
of directors or members shall vote to implement any of the
foregoing.

         

        “Base Rate” means, on
any date, a fluctuating rate of interest per annum equal to the arithmetic
average of the rates of interest publicly announced by JPMorgan Chase Bank and
Citibank, N.A. (or their respective successors) as their respective prime
commercial lending rates (or, as to any such bank that does not announce such a
rate, such bank’s “base” or other rate determined by the Lender to be the
equivalent rate announced by such bank), except that, if any such bank shall,
for any period, cease to announce publicly its prime commercial lending (or
equivalent) rate, the Lender shall, during such period, determine the Base Rate
based upon the prime commercial lending (or equivalent) rates announced publicly
by the other such bank or, if each such bank ceases to announce publicly its
prime commercial lending (or equivalent) rate, based upon the prime commercial
lending (or equivalent) rate or rates announced publicly by one or more other
banks selected by the Lender.  The prime commercial lending (or
equivalent) rates used in computing the Base Rate are not intended to be the
lowest rates of interest charged by 
such banks in connection with extensions of credit to debtors.  The
Base Rate shall change as and when such banks’ prime commercial lending (or
equivalent) rates change.

         

        
          
            
            

          

          
            3

            
              

            

          

          
            
            

          

        

        “Borrower” has the
meaning assigned to that term in the preamble hereto.

         

        “Borrower Pension
Plan” means a “pension plan” as such term is defined in section 3(2) of
ERISA, which is subject to title IV of ERISA and to which the Borrower or any
ERISA Affiliate of Borrower may have any liability, including any liability by
reason of having been a substantial employer within the meaning of section 4063
of ERISA at any time during the preceding five years, or by reason of being
deemed to be a contributing sponsor under section 4069 of ERISA.

         

        “Borrowing” means a
borrowing of Loans under this Agreement.

         

        “Borrowing Base”
means, at any time, the sum of the Pool A Borrowing Base plus the
Pool B Borrowing Base at such time.

         

        “Borrowing Base
Certificate” means a report, in substantially the form of Exhibit A,
prepared by the Borrower (or the initial Servicer on its behalf) for the benefit
of Lender pursuant to Section 6.10(c).

         

        “Borrowing Base
Deficiency” means, at any time, that the Borrowing Base is less than the
Facility Amount, an amount equal to the amount of such deficiency.

         

        “Borrowing Base
Surplus” means, at any time, that the Borrowing Base exceeds the Facility
Amount, an amount equal to the amount of such excess.

         

        “Borrowing Date”
means, with respect to any Borrowing, the date on which such Borrowing is
funded, which date, other than in the case of the initial Borrowing, shall be a
Subsequent Borrowing Date.

         

        “Borrowing Limit”
means $250,000,000, as such amount may be increased pursuant to Section 2.16; provided, however, that at all
times, on or after the Program Termination Date, the Borrowing Limit shall mean
the aggregate outstanding principal balance of the Loans.

         

        “Breakage Fee” means,
for Loans allocated to any Interest Period during which such Loans are repaid
(in whole or in part) prior to the end of such Interest Period, the breakage
costs, if any, related to such repayment plus the amount, if any, by which
(i) interest (calculated without taking into account any Breakage Fee),
which would have accrued on the amount of the payment of such Loans during such
Interest Period (as so computed) if such payment had not been made, as the case
may be, exceeds (ii) the sum of (A) interest actually received by the
Lender in respect of such Loans for such Interest Period and, if applicable,
(B) the income, if any, received by the Lender from the Lender’s investing
the proceeds of such payments on such Loans.

         

        “Business Day” means a
day of the year other than a Saturday or a Sunday or any other day on which
banks are authorized or required to close in New York City, St. Paul, Minnesota
or Salt Lake City, Utah; provided, that, if
any determination of a Business Day shall relate to a Loan bearing interest at
the Adjusted Eurodollar Rate, the term “Business Day” shall also exclude any day
on which banks are not open for dealings in dollar deposits in the London
interbank market.

         

        “Calculated Swap Amortizing
Balance” means, with respect to a Qualifying Interest Rate Swap and as of
any date of determination, the projected scheduled amortizing balance of the
Pledged Receivables which were Pledged during the period ending on the
Remittance Date on which such Qualifying Interest Rate Swap became effective and
beginning on the day following the immediately preceding Remittance Date,
determined by the Servicer and accepted by the Lender based upon the Discounted
Balance of such Pledged Receivables as of such date of determination, adjusted
for prepayments using an absolute prepayment speed which, in the judgment of the
Lender, is consistent with the speed with which the Pledged Receivables have
prepaid in the past.

         

        
          
            
            

          

          
            4

            
              

            

          

          
            
            

          

        

        “Capital Stock” of any
Person means any and all shares, interests, rights to purchase, warrants,
options, contingent share issuances, participations or other equivalents of or
interest in equity (however designated) of such Person.

         

         “Cash Reserve” means
any amount paid to the Originator, the Servicer or the Borrower by an Obligor
that is an Underlying Originator as a cash reserve which may be drawn upon if
amounts due under the related Underlying Originator Loan Contract are not paid
when due (or by the end of any cure period related thereto), which has not
previously been refunded to such Obligor or applied toward such Obligor’s
obligations under such Underlying Originator Loan Contract.

         

        “Cash Reserve Account”
has the meaning assigned to that term in Section 2.06.

         

        “Cash Reserve Account
Agreement” means any Securities Account Agreement with respect to any
Cash Reserve Account established by an Originator, among the Borrower, the
Servicer, the Lender’s Bank and the Lender, in form and substance satisfactory
to the parties thereto, as such agreement may from time to time be amended,
supplemented or otherwise modified in accordance with the terms
thereof.

         

        “Certificate of Title”
means with respect to a Vehicle, (i) if such Vehicle is registered in Florida,
(x) to the extent the related Receivable has been originated by an Originator,
an original certificate of title or (y) to the extent the related Receivable has
been Originated by a Person other than an Originator, (A) an original
certificate of title or (B) if the original certificate of title has been sent
to the registered owner of such Vehicle, an original computer confirmation of
lien, (ii) if such Vehicle is registered in Kansas, a true copy of the
application for certificate of  title and registration, (iii) if such
Vehicle is registered in Kentucky, an original notice of lien, (iv) if such
Vehicle is registered in Maryland, an original notice of security interest
filing, (v) if such Vehicle is registered in Minnesota, an original lien card,
(vi) if such Vehicle is registered in Missouri, an original notice of recorded
lien, (vii) if such Vehicle is registered in Montana, a true copy of the
application for certificate of title, (viii) if such Vehicle is registered in
New York, an original notice of lien, (ix) if such Vehicle is registered in
Oklahoma, an original, file-stamped lien entry form, (x) if such Vehicle is
registered in Wisconsin, an original lien confirmation card or (xi) if such
Vehicle is registered in any other State, an original certificate of title, in
each case issued by the Registrar of Titles of the applicable State listing the
lienholder of record with respect to such Vehicle (it being understood and
agreed that solely for purposes of clauses (i) through
(x) above
(other than clauses
(i)(x) and (i)(y)(A)), the
“original” of any document required thereby shall consist of whatever
documentation has been issued by the Registrar of Titles of the related State to
the lienholder).

         

        “Change of Control”
means that at any time (i) Owner shall own directly or indirectly less than 100%
of all membership interests of the Borrower, (ii) Resource America shall
own directly or indirectly less than 50.1% of all Capital Stock or voting power
of the initial Servicer, (iii) the initial Servicer shall own directly or
indirectly less than 80% of all Capital Stock or voting power of Originator and
Owner, (iv) Resource America, Owner, the Originator or the
Borrower merges or consolidates with any other Person without the prior written
consent of the Lender, (v) the initial Servicer, the Owner or the Originator
merges or consolidates with any other Person and the initial Servicer, the Owner or the Originator,
as applicable, is not the surviving entity or (vi) either of Crit DeMent or
Miles Herman is not employed in a senior management position at the initial
Servicer, is not involved in the day-to-day operations of the initial Servicer
or is not able to perform substantially all of his duties as an employee of the
initial Servicer during any three month period and, in each case, has not been
replaced by a person approved by the Lender in writing within 90 days of any
such event.

         

         “Closing Date” means
October 31, 2006.

         

        “Code” means the
Internal Revenue Code of 1986, as amended.

         

        “Collateral Agent”
means the Lender in its capacity as collateral agent on behalf of the Secured
Parties.

         

        “Collateral Receipt”
has the meaning assigned to that term in the Custodial Agreement.

         

        
          
            
            

          

          
            5

            
              

            

          

          
            
            

          

        

        “Collection Account”
means a special trust account (account number 106682000 at the Lender’s Bank) in
the name of the Borrower and under the control of the Lender; provided, that the
funds deposited therein (including any interest and earnings thereon) from time
to time shall constitute the property and assets of the Borrower and the
Borrower shall be solely liable for any taxes payable with respect to the
Collection Account.

         

        “Collection Account
Agreement” means that certain Collection Account Agreement, dated the
date of this Agreement, among the Borrower, the Servicer, the Lender’s Bank and
the Lender, as such agreement may from time to time be amended, supplemented or
otherwise modified in accordance with the terms thereof.

         

        “Collection Date”
means the date on which the aggregate outstanding principal amount of the Loans
have been repaid in full and all interest and Fees and all other Obligations
have been paid in full, and the Lender shall have no further obligation to make
any additional Loans.

         

        “Collection Period”
means, (i) with respect to any Remittance Date (including the initial Remittance
Date), the period beginning on, and including, the first day of the most
recently ended calendar month and ending on, and including, the last day of the
most recently ended calendar month; provided, that the
final Collection Period shall begin on, and include, the first day of the then
current calendar month and shall end on the Collection Date and (ii) in any
context other than with respect to any Remittance Date, a calendar
month.

         

        “Collections” means,
without duplication, with respect to any Pledged Receivable, all Scheduled
Payments (and, in the case of a Pledged Pool B Receivable after a Pool B
Termination Event has occurred with respect to the related Underlying
Originator, all Underlying Scheduled Payments) related to such Receivable, all
prepayments and related penalty payments with respect to the Contract (and any
related Underlying Contract related to a Pledged Pool B Receivable after a Pool
B Termination Event has occurred with respect to the related Underlying
Originator) related to such Receivable, all overdue payments and related
interest and penalty payments with respect to the Contract (and any related
Underlying Contract related to a Pledged Pool B Receivable after a Pool B
Termination Event has occurred with respect to the related Underlying
Originator) related to such Receivable, all Guaranty Amounts, all Insurance
Proceeds, all Servicing Charges, all proceeds under “buyout letters” or other
prepayment/termination agreements and all Recoveries related to such Receivable,
all amounts paid to the Borrower related to such Receivable pursuant to the
terms of the Purchase and Sale Agreement, all amounts paid by the Servicer
related to such Receivable in connection with its obligations under Section 6.20
hereof, and all other payments received with respect to the Contract (and, if
applicable, Underlying Contract) related to such Receivable, all cash receipts
and proceeds in respect of the Other Conveyed Property or Related Security
(including, without limitation, the Obligor Collateral) related to such
Receivable, any Servicer Advances related to such Receivable, and any amounts
paid to the Borrower under or in connection with any Qualifying Interest Rate
Swap or the hedging arrangements contemplated thereunder.

         

        “Commitment
Percentage” has the meaning assigned to that term in Section 9.04(b).

         

        “Computer Tape or
Listing” means the computer tape or listing (whether in electronic form
or otherwise) generated by the Servicer on behalf of the Borrower, which
provides information relating to the Receivables included in the Net Eligible
Receivables Balance.

         

        “Contract” means a
Pool A Contract or a Pool B Contract.

         

        “Credit and Collection
Policy” means (i) collectively, the “Operations Policies &
Procedures”  memorandum, the “Limited Recourse Term Debt Facility”
memorandum of the Servicer, and certain other items, as annexed hereto as Schedule IV as
such policy may hereafter be amended, modified or supplemented from time to time
in compliance with this Agreement and (ii) with respect to any Servicer other
than LEAF Financial, that Servicer’s collection policies for similar assets in
effect from time to time.

         

        “Critical Defaults”
has the meaning assigned to that term in Section 5.01(u)
hereof.

         

        “Custodial Agreement”
means that certain Custodial Agreement dated as of the date hereof among the
Servicer, the Borrower, the Lender and the Custodian, together with all
instruments, documents and agreements executed
in connection therewith, as such Custodial Agreement may from time to time be
amended, restated, supplemented and/or otherwise modified in accordance with the
terms thereof.

         

        
          
            
            

          

          
            6

            
              

            

          

          
            
            

          

        

        “Custodian” means U.S.
Bank National Association (or a sub-custodian on its behalf) or any substitute
Custodian appointed by the Lender pursuant to the Custodial
Agreement.

         

        “Custodian’s Fee”
means, for any Fee Period, an amount, payable out of Collections on the Pledged
Receivables and amounts applied to the payment of, or treated as payments on,
the Pledged Receivables, equal to the aggregate fees listed in that certain
“Schedule of Fees” letter dated October 19, 2006 between U.S. Bank National
Association and Leaf Financial Corporation which relate to such Fee
Period.

         

        “Debt” of any Person
means (i) indebtedness of such Person for borrowed money,
(ii) obligations of such Person evidenced by bonds, debentures, notes or
other similar instruments related to transactions that are classified as
financings under GAAP, (iii) obligations of such Person to pay the deferred
purchase price of property or services, (iv) obligations of such Person as
lessee under leases which shall have been or should be, in accordance with GAAP,
recorded as capital leases, (v) obligations secured by an Adverse Claim
upon property or assets owned (under GAAP) by such Person, even though such
Person has not assumed or become liable for the payment of such obligations and
(vi) obligations of such Person under direct or indirect guaranties in
respect of, and obligations (contingent or otherwise) to purchase or otherwise
acquire, or otherwise to assure a creditor, against loss in respect of,
indebtedness or obligations of others of the kinds referred to in
clauses (i) through (v) above.

         

        “Default Funding Rate”
means an interest rate per annum equal to 1.50% plus the Base Rate.

         

        “Defaulted Receivable”
means, as of any date of determination, any Pledged Receivable:

         

        
          	
                   
      

                	
                  (i)

                	
                  with
      respect to which any part of any Scheduled Payment, or any tax-related
      payment, owed by the applicable Obligor under the terms of the related
      Contract remains unpaid for more than 120 days after the due date
      therefor set forth in such
Contract;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  with
      respect to which the first or second Scheduled Payment is not paid in full
      when due under the related
Contract;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  with
      respect to which any payment or other material terms of the related
      Contract have been modified due to credit related reasons after such
      Contract was acquired by the Borrower pursuant to the Purchase and Sale
      Agreement;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  which
      has been or should be charged off as a result of the occurrence of a
      Bankruptcy Event with respect to the related Obligor or Underlying
      Obligor, if any, or which has been or should otherwise be deemed
      uncollectible by the Servicer, in each case, in accordance with the Credit
      and Collection Policy; or

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  with
      respect to which the Servicer has repossessed the related
      Equipment.

                

        

         

        “Delinquency Rate”
means, as of any date of determination, an amount (expressed as a percentage)
equal to (i) the aggregate Discounted Balances of all Delinquent
Receivables as of the last day of the immediately preceding Collection Period
divided by (ii) the Net Eligible Receivables Balance as of such
day.

         

        “Delinquent
Receivable” means, as of any date of determination, any Pledged
Receivable (other than a Defaulted Receivable) with respect to which any part of
any Scheduled Payment (or other amount payable under the terms of the related
Contract) remains unpaid for more than 60 days but not more than 120 days
after the due date therefor set forth in such Contract.

         

        “Depository
Institution” means a depository institution or trust company,
incorporated under the laws of the United States or any State thereof, that is
subject to supervision and examination by federal and/or State banking
authorities.

         

        
          
            
            

          

          
            7

            
              

            

          

          
            
            

          

        

        “Discount Rate” means,
as of any date of determination, a percentage equal to the sum of (i) the
Weighted Average Swapped Rate as of such date of determination, (ii) the
Adjusted Eurodollar Rate Margin, (iii) at any time prior to the occurrence of a
Servicer Default and the appointment of the Backup Servicer as Servicer
hereunder, the Servicing Fee Rate and the Standby Backup Servicing Fee Rate,
(iv) at any time after the occurrence of a Servicer Default and the
appointment of the Backup Servicer as Servicer hereunder, the Active Backup
Servicing Fee Rate and (vi) a rate per annum equal to 0.05%.

         

        “Discounted Balance”
means, with respect to any Contract or Underlying Contract, as of any date of
determination, the present value of the aggregate amount of Scheduled Payments
or, in the case of an Underlying Contract, Underlying Scheduled Payments
(including any Balloon Payment or Put Payment but, in any event, calculated
without giving effect to any booked residual value with respect to any related
Equipment) due or to become due under the terms of the related Contract or
Underlying Contract after the Cut-Off Date applicable to the Receivable related
thereto, which remain unpaid as of such date of determination, calculated by
discounting such aggregate amount of such Scheduled Payments or, in the case of
an Underlying Contract, such Underlying Scheduled Payments to such date of
determination at an annual rate equal to the Discount Rate.

         

        “Dollar Purchase Option
Contract” means a Contract or an Underlying Contract, as applicable,
(i) in connection with which an agreement was executed which grants the
related Obligor or Underlying Obligor, as applicable, a right to purchase the
Equipment or Underlying Equipment leased under such Contract or Underlying
Contract for $1.00 or other nominal consideration at the end of the initial term
of such Contract or Underlying Contract or (ii) grants the related Obligor
or Underlying Obligor, as applicable, a right to purchase the Equipment or
Underlying Equipment leased under such Contract for $1.00 or other nominal
consideration at the end of the initial term of such Contract.

         

        “Eligible Depository
Institution” means a Depository Institution the short term unsecured
senior indebtedness of which is rated at least Prime-1 by Moody’s, A-1 by
S&P, and F1 by Fitch, if rated by Fitch.

         

        “Eligible Pool A
Receivable” means, at any time, a Pledged Pool A Receivable with
respect to which each of the representations and warranties regarding the
Contract related to such Pledged Pool A Receivable contained in Schedule III-A
hereto is true and correct at such time.

         

        “Eligible Pool A
Receivables Balance” means, at any time, the aggregate Discounted
Balances of all Eligible Pool A Receivables which are Pledged hereunder to
secure Loans at such time.

         

        “Eligible Pool B
Receivable” means, at any time, a Pledged Pool B Receivable with
respect to which each of the representations and warranties regarding the
Contract related to such Pledged Pool B Receivable contained in Schedule III-B
hereto is true and correct at such time.

         

        “Eligible Pool B
Receivables Balance” means, at any time, the aggregate Discounted
Balances of all Eligible Pool B Receivables which are Pledged hereunder to
secure Loans at such time.

         

        
          
            
            

          

          
            8

            
              

            

          

          
            
            

          

        

        “Eligible Pool B
Underlying Lease Contract” means, at any time, an Underlying Lease
Contract with respect to which each of the representations and warranties
contained in Schedule III-C
hereto is true and correct at such time.

         

        “Eligible Pool B
Underlying Loan Contract” means, at any time, an Underlying Loan Contract
with respect to which each of the representations and warranties contained in
Schedule III-C
hereto is true and correct at such time.

         

        “Eligible Receivable”
means, at any time, a Pledged Receivable which is an Eligible Pool A
Receivable or an Eligible Pool B Receivable at such time.

         

        “Eligible Receivables
Balance” means, at any time, the aggregate Discounted Balances of all
Eligible Receivables which are Pledged hereunder to secure Loans at such
time.

         

        “Eligible Underlying
Contract” means an Eligible Pool B Underlying Lease Contract or
Eligible Pool B Underlying Loan Contract.

         

        “Eligible Underlying
Originator” means an Underlying Originator that has been approved by the
initial Servicer in accordance with the Credit and Collection
Policy.

         

        “Equipment” means the
equipment or Vehicle (i) leased to an Obligor, or serving as collateral for a
loan to an Obligor, under a Contract together with any replacement parts,
additions and repairs thereof, and any accessories incorporated therein and/or
affixed thereto or (ii) leased to an Underlying Obligor, or serving as
collateral for a loan to an Underlying Obligor, under a Underlying Contract
together with any replacement parts, additions and repairs thereof, and any
accessories incorporated therein and/or affixed thereto.

         

        “Equipment Category”
means any of the Equipment Categories set forth on Schedule V hereto, as such
schedule may be updated from time to time by the Borrower with the consent of
the Lender (which such consent shall not be unreasonably withheld).

         

        “ERISA” means the
United States Employee Retirement Income Security Act of 1974, as amended from
time to time.

         

        “ERISA Affiliate”
means a corporation, trade or business that is, along with any Person, a member
of a controlled group of corporations or a controlled group of trades or
businesses, as described in section 414 of the Internal Revenue Code of 1986, as
amended, or section 4001 of ERISA.

         

        “Eurodollar Disruption
Event” means any of the following:  (i) a determination by
the Lender that it would be contrary to law or to the directive of any central
bank or other governmental authority (whether or not having the force of law) to
obtain United States dollars in the London interbank market to make, fund or
maintain any Loan, (ii) a determination by the Lender that the rate at
which deposits of United States dollars are being offered in the London
interbank market does not accurately reflect the cost to the Lender of making,
funding or maintaining any Loan or (iii) the inability of the Lender to
obtain United States dollars in the London interbank market to make, fund or
maintain any Loan.

         

        “Eurodollar Index”
means an index based upon an interest rate reported on Telerate Access Service
Page 3750 (British Bankers Association Settlement Rate) as the London
Interbank Offered Rate for United States dollar deposits.

         

        “Event of Default” has
the meaning assigned to that term in Section 7.01.

         

        “Exception Sublimit
Receivable” means a Pool A Receivable arising under a Lease Contract
related to Equipment having an original cost of less than $100,000 as to which
the original, executed Lease Contract has not been forwarded to the Custodian
for inclusion in the related Receivable File.

         

        “Facility Amount”
means, at any time, the sum of the aggregate Loans Outstanding hereunder bearing
interest at the Interest Rate, plus accrued interest
and Fees with respect to such amounts.

         

        “Facility Maturity
Date” means the third anniversary of the date of this
Agreement.

         

        “Fee Letter” has the
meaning assigned to that term in Section 2.08(a).

         

        “Fee Period” means a
period commencing on (and including) a Remittance Date and ending on (and
including) the day prior to the next Remittance Date; provided, that, the
initial Fee Period hereunder shall commence on (and include) the date hereof and
end on (and include) December 22, 2006.

         

        “Fees” has the meaning
assigned to that term in Section 2.08(a).

         

        “Fitch” means Fitch,
Inc. (or its successors in interest).

         

        
          
            
            

          

          
            9

            
              

            

          

          
            
            

          

        

        “FMV Contract” means a
Contract or an Underlying Contract, as applicable, which (i) in connection
with which any agreement was executed which grants the related Obligor or
Underlying Obligor, as applicable, a right to purchase the Equipment or
Underlying Equipment leased under such Contract or Underlying Contract for the
fair market value thereof at the end of the initial term of such Contract or
Underlying Contract or (ii) grants the related Obligor or Underlying
Obligor, as applicable, a right to purchase the Equipment or Underlying
Equipment leased under such Contract for the fair market value thereof at the
end of the initial term of such Contract.

         

        “GAAP” means generally
accepted accounting principles as in effect from time to time in the United
States.

         

        “Global Overconcentration
Amount” means, at any time (x) after the first anniversary of the Closing
Date or (y) the aggregate outstanding principal balance of the Loans is greater
than $35,000,000, without duplication, the sum of:

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible Pool A
      Receivables related to any one Obligor (or any Affiliate thereof) at such
      time exceeds $3,000,000;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      amount by which the sum of the Discounted Balances at such time of all
      Eligible Pool A Receivables related to the three Obligors which, together
      with any Affiliates thereof, owe the greatest amounts under their
      respective Contracts, in the aggregate, exceeds
  $9,500,000;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables with respect to which the related Contract is a Non-Level
      Payment Contract exceeds 20% of the sum of the Discounted Balances of all
      Eligible Receivables at such time;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables with respect to which the related Contract provides for
      Scheduled Payments to be paid for any period other than monthly exceeds
      10% of the sum of the Discounted Balances of all Eligible Receivables at
      such time;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables related to Obligor Collateral located in the State of
      California at such time exceeds 30% of the sum of the Discounted Balances
      of all Eligible Receivables at such
time;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables related to Obligor Collateral located in any State other than
      the State of California exceeds 20% of the sum of the Discounted Balances
      of all Eligible Receivables at such
time;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables related to Equipment within any one Equipment Category exceeds
      the sum of the Discounted Balances of all Eligible Receivables at such
      time multiplied by 50%;

                

        

         

        
          	
                   
      

                	
                  (viii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables, with respect to which the related Obligor Collateral is a
      Vehicle or other type of equipment which requires a security interest
      therein to be noted on the Certificate of Title with respect thereto in
      order to be perfected, exceeds 50% of the sum of the Discounted Balances
      of all Eligible Receivables at such
time;

                

        

         

        
          	
                   
      

                	
                  (ix)

                	
                  [reserved];

                

        

         

        
          	
                   
      

                	
                  (x)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables, with respect to which the related Obligor is a Government
      Entity, exceeds 10% of the sum of the Discounted Balances of all Eligible
      Receivables at such time;

                

        

         

        
          
            
            

          

          
            10

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (xi)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables, which are Exception Sublimit Receivables, exceeds 10% of the
      sum of the Discounted Balances of all Eligible Receivables at such time
      (it being understood and agreed that, notwithstanding anything herein to
      the contrary (including clauses (x) and
      (y)
      above), this component of the Global Overconcentration Amount shall apply
      at all times on and after the Closing Date);
and

                

        

         

        
          	
                   
      

                	
                  (xii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Receivables with respect to which the related Obligor Collateral is a work
      vehicle exceeds 20% of the sum of the Discounted Balances of all Eligible
      Receivables at such time.

                

        

         

        “Government Entity”
means the United States, any State, any political subdivision of a State and any
agency or instrumentality of the United States or any State or political
subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to
government.

         

        “Guaranty Amounts”
means any and all amounts paid by any guarantor with respect to the applicable
Contract.

         

        “Holdback Amount”
means, with respect to any Pool B Receivable, the amount of any loan principal
or purchase price which would otherwise be advanced by the Originator to the
applicable Obligor pursuant to the terms of such Contract, but which was held
back by the Originator as a liquidity reserve or similar reserve.

         

        “Included Repurchased
Receivable” means any Receivable repurchased by the Originator pursuant
to Section 6.1(b) of the Purchase and Sale Agreement with respect to which, as
of the date of repurchase, any part of any Scheduled Payment (or other amount
payable under the terms of the related Contract) remained unpaid after the due
date therefor set forth in such Contract.

         

        “Indemnified Amounts”
has the meaning assigned to that term in Section 8.01.

         

        “Independent
Accountants” has the meaning assigned to that term in Section 6.11(b).

         

        “Initial Qualified Swap
Counterparty” means Morgan Stanley Capital Services Inc., a Delaware
corporation and its successors and permitted assigns.

         

        “Insurance
Certificate” means the insurance certificate related to the Insurance
Policy with respect to such Receivable (which insurance certificate shall
list the Servicer or the
Originator as a loss payee).

         

        “Insurance Policy”
means, with respect to any Obligor Collateral, the insurance policy maintained
by or on behalf of the Obligor pursuant to the related Contract that covers
physical damage to the related Equipment (in an amount sufficient to insure
completely the value of such Equipment) and general liability (including
policies procured by the Borrower or the Servicer, or any agent thereof, on
behalf of the Obligor).

         

        “Insurance Proceeds”
means, with respect to an item of Obligor Collateral and a related Contract, any
amount paid under an Insurance Policy or an Underlying Insurance Policy issued
with respect to such Obligor Collateral and/or the related
Contract.

         

        “Interest Period”
means, for any outstanding Loans, a period determined pursuant to Section 2.03(a).

         

        “Interest Rate” has
the meaning assigned to such term in Section
2.03(b).

         

        “LEAF Financial” has
the meaning assigned to that term in the preamble hereto.

         

        “Lease Contract” means
(i) a “Master Lease Schedule” in the form attached hereto as Exhibit D-1(b),
Exhibit D-1(c),
Exhibit D-1(d),
together with a “Master Lease Agreement” in the form attached hereto as Exhibit D-1(a)
which is related to, and incorporated by reference into, a “Master Lease
Schedule” (as such exhibits may be updated from time to time by the Borrower
with the consent of the Lender), (ii) a “Lease Agreement” in the

         

        
          
            
            

          

          
            11

            
              

            

          

          
            
            

          

        

        form
attached hereto as Exhibit D-1(e)
or (iii) a lease agreement otherwise approved by the Servicer in compliance with
the Credit and Collection Policy, pursuant to which Equipment is leased to an
Obligor by Originator, together with all schedules, supplements and amendments
thereto and each other document and instrument related to such
lease.

         

        “Lender” means,
collectively, Morgan Stanley and/or any other Person that is an Affiliate of
Morgan Stanley and/or, with the consent of the Borrower (which such consent
shall not be unreasonably withheld) at any time prior to the occurrence of a
Program Termination Event (and without the consent of the Borrower at any time
after the occurrence of a Program Termination Event), any other Person that is
not an Affiliate of Morgan Stanley, in each case, that agrees, pursuant to the
pertinent Assignment and Acceptance, to make Loans secured by Pledged Assets
pursuant to Article II of this Agreement.

         

        “Lender’s Bank” means
U.S. Bank National Association and its successors and assigns that are Eligible
Depository Institutions.

         

        “Lender’s Bank Fee”
means an annual fee paid in advance, payable out of Collections on the Pledged
Receivables and amounts applied to the payment of, or treated as payments on,
the Pledged Receivables, equal to $7,000.  The “Lender’s Bank Fee”
shall also include (i) a one-time acceptance fee of $4,500 payable on the
Closing Date and (ii) reasonable out-of-pocket expenses incurred by the Lender’s
Bank in the performance of its duties.

         

        “Liquidation Proceeds”
means, with respect to a Receivable with respect to which the related Obligor
Collateral has been repossessed or foreclosed upon by the Servicer, all amounts
realized with respect to such Receivable net of (i) reasonable expenses of
the Servicer incurred in connection with the collection, repossession,
foreclosure and/or disposition of the related Obligor Collateral and
(ii) amounts that are required to be refunded to the Obligor on such
Receivable; provided, however, that the
Liquidation Proceeds with respect to any Receivable shall in no event be less
than zero.

         

        “Loan” means each loan
advanced by the Lender to the Borrower on a Borrowing Date pursuant to Article II.

         

        “Loan Contract” means,
collectively, (i) a “Term Note (Level Payments)” together with the “Master Loan
and Security Agreement” related thereto and incorporated by reference therein,
each in the form attached hereto as Exhibit D-2(a)
(as such exhibit may be updated from time to time by the Borrower with the
consent of the Lender), (ii) a “Term Note (Level Payments)” or “Term Note (Step
Payments)” together with the “Master Loan and Security Agreement” related
thereto and incorporated by reference therein, each in the form attached hereto
as Exhibit D-2(b)
(as such exhibit may be updated from time to time by the Borrower with the
consent of the Lender) or (iii, (iii) a “Finance Agreement” in one
of the forms attached as Exhibit D-2(c) or similar agreement approved in writing
by the Lender (in its reasonable discretion), or (iv) a loan agreement
and promissory note otherwise approved by the Servicer in compliance with the
Credit and Collection Policy as
to which the Servicer has notified the Collateral Agent in writing, in
each case, pursuant to which the Originator makes a loan to an Obligor secured
by Equipment purchased by such Obligor, together with all schedules, supplements
and amendments thereto and each other document and instrument related
thereto.

         

        “Loans Outstanding”
means the sum of the principal amounts of Loans loaned to the Borrower for the
initial and any subsequent borrowings pursuant to Sections 2.01
and 2.02,
reduced from time to time by Collections with respect to any Pledged Receivable
received and distributed as repayment of principal amounts of Loans outstanding
pursuant to Section 2.04 and
any other amounts received by the Lender to repay the principal amounts of Loans
outstanding pursuant to Section 2.15 or
otherwise; provided, however, that the
principal amounts of Loans outstanding shall not be reduced by any Collections
with respect to any Pledged Receivable or other amounts if at any time such
Collections or other amounts are rescinded or must be returned for any
reason.

         

        “Lockbox” means a post
office box to which Collections with respect to any Pledged Receivable are
remitted for retrieval by the Lockbox Bank and for deposit by the Lockbox Bank
into the Lockbox Account.

         

        
          
            
            

          

          
            12

            
              

            

          

          
            
            

          

        

        “Lockbox Account”
means the deposit account (account number 153910088597 at the Lockbox Bank) in
the name of “U.S. Bank NA as Securities Intermediary for LEAF Financial and
various lenders”.

         

        “Lockbox Bank” means
U.S. Bank National Association and its successors in interest.

         

        “Lockbox Intercreditor
Agreement” means the Amended and Restated Lockbox Intercreditor
Agreement, dated as of April 18, 2005, among the Lockbox Bank, the Servicer, the
Borrower, and certain other parties.

         

        “Material Adverse
Effect” means a material adverse effect on (i) the ability of the
Borrower, the Originator and/or the Servicer to conduct its business,
(ii) the ability of the Borrower, the Originator and/or the Servicer to
perform its respective obligations under this Agreement and/or any other
Transaction Document to which it is a party, (iii) the validity or
enforceability of this Agreement and/or any other Transaction Document to which
the Borrower, the Originator and/or the Servicer is a party, (iv) the
rights and remedies of the Lender under this Agreement and/or any of the
Transaction Documents and/or (v) the validity, enforceability or
collectibility of all or any portion of the Pledged Receivables.

         

        “Minimum Tangible Net
Worth means, (i)
with respect to Resource America, a Tangible Net Worth (measured as of
each fiscal quarter end) of not less than $125,000,000.125,000,000 and (ii) with respect to
the Owner, a Tangible Net Worth (measured as of each fiscal quarter end) of not
less than (x) $2,500,000 plus, (y) only if the Owner Issuance Condition has been
satisfied, the product of 50.00%, times the aggregate outstanding principal
balance of the Owner Secured Recourse Promissory Notes held by Persons that are
not Affiliates of the Owner.

         

        “Monthly Remittance
Report” means a report, in substantially the form of Exhibit C,
furnished by the Servicer to the Lender pursuant to Section 6.10(b).

         

        “Moody’s” means
Moody’s Investors Service, Inc. (or its successors in interest).

         

        “Morgan Stanley” has
the meaning assigned to that term in the preamble hereto.

         

        “Netbank Facility” means the facility evidenced by the
Receivables Loan and Security Agreement, dated as of November 1, 2007, among
Leaf Capital Funding III, LLC, as borrower, LEAF Financial, Morgan Stanley,
Morgan Stanley Asset Funding Inc., The Royal Bank of Scotland, U.S. Bank
National Association and Lyon Financial Services, Inc. (d/b/a U.S. Bank
Portfolio Services), as the same may be modified, amended, or supplemented from
time to time.

         

        “Net Eligible Receivables
Balance” means, at any time, (i) the Eligible Receivables Balance at
such time, minus (ii) the Overconcentration Amount at such
time.

         

        “Nominee Lienholder
Agreement” means either (i) a “Vehicle Lienholder Nominee Agreement” in
the form attached hereto as Exhibit E (with such
modifications as the Collateral Agent may approve) or (ii) any other nominee
lienholder agreement or collateral agency agreement approved in writing by the
Collateral Agent.

         

        “Non-Level Payment
Contract” means a Contract that does not provide for level Scheduled
Payments during the term of such Contract.

         

        “Notice of Borrowing”
has the meaning assigned to that term in Section 2.02(b)
hereof.

         

        “Notice of Pledge” has
the meaning assigned to that term in the Custodial Agreement.

         

        “Obligations” means
all present and future indebtedness and other liabilities and obligations
(howsoever created, arising or evidenced, whether direct or indirect, absolute
or contingent, or due or to become due) of the Borrower to the Secured Parties
arising under this Agreement and/or any other Transaction Document and shall
include, without limitation, all liability for principal of and interest on the
Loans, indemnifications and other amounts due or to become due by the Borrower
to the Secured Parties under this Agreement and/or any other Transaction
Document, including, without limitation, interest, fees and other obligations
that accrue after the commencement of an insolvency proceeding (in each case
whether or not allowed as a claim in such insolvency proceeding).

         

        
          
            
            

          

          
            13

            
              

            

          

          
            
            

          

        

        “Obligor” means,
collectively, each Person obligated to make payments under a
Contract.

         

        “Obligor Collateral”
means (i) the Equipment leased to an Obligor under a Lease Contract,
(ii) the Equipment and other property pledged by an Obligor to secure its
obligations under a Loan Contract, (iii) the Equipment and other property
pledged by an Obligor to secure its obligations under a Practice Acquisition
Loan Contract and (iv) the Underlying Originator Loan Collateral and other
property pledged by an Obligor to secure its obligations under an Underlying
Originator Loan Contract.

         

        “Obligor Financing
Statement” means a UCC financing statement filed by Originator against an
Obligor under a Contract which evidences a security interest in the related
Obligor Collateral.

         

        “Officer’s
Certificate” means a certificate signed by the president, the secretary,
the chief financial officer or any vice president of any Person.

         

        “Opinion of Counsel”
means a written opinion of independent counsel acceptable to the Lender, which
opinion, if such opinion or a copy thereof is required by the provisions of this
Agreement or any other Transaction Document to be delivered to the Borrower or
the Lender, is acceptable in form and substance to the Lender.

         

        “Originator” means
LEAF Funding, Inc., a Delaware corporation.

         

        “Originator Insurance
Agreement” means that certain letter agreement regarding the Originator’s
obligations as named loss payee under Insurance Policies and Underlying
Insurance Policies, dated as of the date hereof, among the Originator, the
Servicer, the Borrower and the Lender, as such agreement may from time to time
be amended, restated, supplemented and/or otherwise modified in accordance with
the terms thereof.

         

        “Other Commercial
Contract” means any agreement approved by the Servicer in compliance with
the Credit and Collection Policy, in each case, pursuant to which the commercial
Obligor thereunder agrees to make periodic payments in connection with any loan,
services, rental or sale, together with all schedules, supplements and
amendments thereto and each other document and instrument related
thereto.

         

        “Other Conveyed
Property” means, with respect to any Receivable, all of the Borrower’s
right, title and interest in, to and under (i) all Collections and other
monies at any time received or receivable with respect to such Receivable after
the applicable Cut-Off Date (as defined in the Purchase and Sale Agreement),
(ii) the Equipment or Underlying Equipment related to such Receivable (to
the extent of the Borrower’s ownership rights, if any, therein), (iii) in
the case of a Receivable related to any Contract, any and all agreements,
documents, certificates and instruments evidencing the Borrower’s security
interest or other interest in and to the related Obligor Collateral or any
intercreditor agreement with respect thereto, including, without limitation, any
Certificate of Title, (iv) the Obligor Collateral related to such
Receivable including, without limitation, the security interest in such Obligor
Collateral granted by the related Obligor to Originator under the related
Contract and assigned by Originator to the Borrower under the Purchase and Sale
Agreement, (v) the Obligor Financing Statement, if any, related to such
Receivable, (vi) the Insurance Policy and any proceeds from the Insurance
Policy relating to such Receivable, including rebates of premiums not otherwise
due to an Obligor, (vii) the related Contract and all other items required
to be contained in the related Receivable File, any and all other documents or
electronic records that the Borrower keeps on file in accordance with its
customary procedures relating to such Receivable, the related Obligor Collateral
or the related Obligor, (viii) any Security Deposits or Cash Reserve
related to such Receivable, (ix) all property (including the right to
receive future Liquidation Proceeds) that secures such Receivable and that has
been acquired by or on behalf of the Borrower pursuant to the liquidation of
such Receivable, and (x) all present and future rights, claims, demands,
causes and chooses in action in respect of any or all of the foregoing and all
payments on or under and all proceeds and investments of any kind and nature in
respect of any of the foregoing.

         

        
          
            
            

          

          
            14

            
              

            

          

          
            
            

          

        

        “Overconcentration
Amount” means, at any time, the sum of the Pool A Overconcentration
Amount at such time and the Pool B Overconcentration Amount at such
time.

         

        “Overdue Payment”
means, with respect to a Collection Period, all payments due in a prior
Collection Period that the Servicer receives from or on behalf of an Obligor
during such Collection Period, including any Servicing Charges.

         

        “Owner” means (i) the
Originator or (ii) subject to the prior written consent of the Lender (such
consent not to be unreasonably withheld), any other subsidiary of the initial
Servicer which acquires all or part of the membership interests of the
Borrower.

         

        “Owner” means LEAF Commercial Finance Fund,
LLC.

         

        “Owner Issuance Condition” shall be deemed to be
satisfied if, on or prior to October 1, 2008 or such other date, not later than
June 1, 2009, as the Owner shall have provided by prior written notice
to the Lender, (i) the Owner has received offering proceeds of at least
$1,000,000 from the issuance of the Owner Secured Recourse Promissory Notes and
(ii) such proceeds have been released to the Owner (and not returned to the
subscribers of the Owner Secured Recourse Promissory Notes) from the escrow
account described in the Owner Private Placement Memorandum.

         

        “Owner Private Placement Memorandum” means that certain
Private Placement Memorandum, dated October 1, 2007, as supplemented or restated
from time to time, and titled “Leaf Commercial Finance Fund, LLC Secured
Recourse Promissory Notes”, a copy of which has been provided to the Collateral
Agent by the Owner.

         

        “Owner Secured Promissory Notes” means the Secured
Recourse Promissory Notes issued by the Owner pursuant to the Indenture
described in Owner Private Placement Memorandum.

         

        “Parallel Defaults”
has the meaning assigned to that term in Section 5.01(u)
hereof.

         

        “Permitted
Investments” means any one or more of the following:

         

        
          	
                   
      

                	
                  (i)

                	
                  direct
      obligations of, or obligations fully guaranteed as to principal and
      interest by, the United States or any agency or instrumentality thereof,
      provided such obligations are backed by the full faith and credit of the
      United States;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  repurchase
      obligations (the collateral for which is held by a third party or the
      Trustee), with respect to any security described in clause (i) above,
      provided that the long-term unsecured obligations of the party agreeing to
      repurchase such obligations are at the time rated by Moody’s and S&P
      in one of their two highest long-term rating categories and if rated by
      Fitch, in one of its two highest long-term rating
    categories;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  certificates
      of deposit, time deposits, demand deposits and bankers’ acceptances of any
      bank or trust company incorporated under the laws of the United States or
      any State thereof or the District of Columbia, provided that the
      short-term commercial paper of such bank or trust company (or, in the case
      of the principal depository institution in a depository institution
      holding company, the long-term unsecured debt obligations of the
      depository institution holding company) at the date of acquisition thereof
      has been rated by Moody’s and S&P in their highest short-term rating
      category, and if rated by Fitch, in its highest short-term rating
      category;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  commercial
      paper (having original maturities of not more than 270 days) of any
      corporation incorporated under the laws of the United States or any State
      thereof or the District of Columbia, having a rating, on the date of
      acquisition thereof, of no less than A-1 by Moody’s, P-1 by S&P and
      F-1 if rated by Fitch;

                

        

         

         

        
          
            
            

          

          
            15

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (v)

                	
                  money
      market mutual funds, including funds managed by the Lender’s Bank or its
      Affiliates, registered under the Investment Company Act of 1940, as
      amended, having a rating, at the time of such investment, of no less than
      Aaa by Moody’s, AAA by S&P and AAA if rated by Fitch;
    and

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  any
      other investments approved in writing by the
  Lender.

                

        

         

        provided, that no
such instrument shall be a Permitted Investment if such instrument evidences the
right to receive either (a) interest only payments with respect to the
obligations underlying such instrument or (b) both principal and interest
payments derived from obligations underlying such instrument, where the
principal and interest payments with respect to such instrument provide a yield
to maturity exceeding 120% of the yield to maturity at par of such underlying
obligation.  Each Permitted Investment may be purchased by the
Lender’s Bank or through an Affiliate of the Lender’s Bank.

         

        “Permitted Liens”
means:

         

        
          	
                   
      

                	
                  (i)

                	
                  with
      respect to Obligor Collateral, (A) liens and security interests in
      favor of the Collateral Agent, granted pursuant to the Transaction
      Documents, (B) the interests of an Obligor arising under the Contract
      to which it is a party in the Obligor Collateral related to such Contract,
      (C) liens for taxes, assessments, levies, fees and other governmental
      and similar charges either not yet due or being contested in good faith
      and by appropriate proceedings, provided, that appropriate reserves shall
      have been established with respect to any such taxes either not yet due or
      being contested in good faith and by appropriate proceedings, (D) any
      liens with respect to any mechanics, suppliers, materialmen, laborers,
      employees, repairmen and other like liens arising in the ordinary course
      of a servicer’s, lessor’s/lender’s or lessee’s/borrower’s business
      securing obligations which are not due and payable, and (E) salvage
      rights of insurers with respect to the equipment subject to a Contract
      under insurance policies maintained pursuant to the Transaction Documents
      or a Contract; and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  with
      respect to Underlying Collateral, in addition to the Permitted Liens
      described in clause (i) above, (x) liens in favor of Originator
      or the Borrower, granted by the applicable Underlying Obligor, in each
      case, solely to the extent assigned to the Collateral Agent and
      (y) the interests of an Underlying Obligor arising under the
      Underlying Contract to which it is a party in the Underlying Originator
      Loan Collateral related to such Underlying
  Contract.

                

        

         

        “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 other
entity.

         

        “Pledge” means the
pledge of any Receivable pursuant to Article II.

         

        “Pledged Assets” has
the meaning assigned to that term in Section 2.11.

         

        “Pledged Receivables”
means Pledged Pool A Receivables and Pledged Pool B
Receivables.

         

        “Pledged Pool A
Receivables” has the meaning assigned to that term in Section 2.11(a).

         

        “Pledged Pool B
Receivables” has the meaning assigned to that term in Section 2.11(a).

         

        “Pledged Receivables
Balance” means, at any time, the aggregate Discounted Balances of all
Receivables which are Pledged hereunder to secure Loans at such
time.

         

        “Pool A Annualized Net
Loss Rate” means, as of any date of determination after the end of the
third Collection Period following the date hereof, an amount (expressed as a
percentage) equal to (i) the product of (A) (x) the aggregate
Discounted Balances of all Pledged Pool A Receivables which were Eligible
Pool A Receivables at the time of their Pledge hereunder and which became
Defaulted Receivables during the six (or such lesser
number of Collection Periods since the date hereof) immediately preceding
Collection Periods minus
(y) Recoveries related to Pool A Receivable received during the six
(or such lesser number of Collection Periods since the date hereof) immediately
preceding Collection Periods and (B) 2 (if six or more Collection Periods
have occurred since the date hereof), 2.4 (if five Collection Periods have
occurred since the date hereof), 3 (if four Collection Periods have
occurred since the date hereof), 4 (if three Collection Periods have
occurred since the date hereof), 6 (if two Collection Periods have occurred
since the date hereof) or 12 (if one Collection Period has occurred since
the date hereof) divided by (ii) the Eligible Pool A Receivables
Balance as of the first Business Day of the six (or such lesser number of
Collection Periods since the date hereof) immediately preceding Collection
Periods.

         

        
          
            
            

          

          
            16

            
              

            

          

          
            
            

          

        

        “Pool A Borrowing
Base” means, at any time, the lowest of:

         

        
          	
                   
      

                	
                  (i)

                	
                  98%
      of the Amortized Equipment Cost with respect to all Eligible Pool A
      Receivables; and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  an
      amount equal to the Pool A Net Eligible Receivables Balance
      multiplied by a percentage equal to
92%.

                

        

         

        “Pool A Contract”
means a Lease Contract, a Loan Contract, a Practice Acquisition Loan Contract, a
Real Estate Contract or an Other Commercial Contract.

         

        “Pool A Lease File”
has the meaning assigned to that term in clause (a) of the
definition of “Receivable File”.

         

        “Pool A Loan” has
the meaning assigned to that term in Section 2.01.

         

        “Pool A Loan File” has
the meaning assigned to that term in clause (b) of the
definition of “Receivable File”.

         

        “Pool A Net Eligible
Receivables Balance” means, at any time, (i) the Eligible
Pool A Receivables Balance at such time minus (ii) the
Pool A Overconcentration Amount at such time.

         

        “Pool A
Overconcentration Amount” means, at any time, (x) after the first
anniversary of the Closing Date or (y) the aggregate outstanding principal
balance of the Loans is greater than $35,000,000, without duplication, the sum
of:

         

        
          	
                   
      

                	
                  (i)

                	
                  an
      amount equal to the Global Overconcentration Amount at such time
      multiplied by a fraction the numerator of which is the aggregate
      Discounted Balances of all Eligible Pool A Receivables at such time
      and the denominator of which is the aggregate Discounted Balances of all
      Eligible Receivables at such time;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables with respect to which the related Contract has a
      remaining term greater than 85 months and equal to or less than 120 months
      exceeds 50% of the sum of the Discounted Balances of all Eligible
      Pool A Receivables at such
time;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables with respect to which the related Contract has a
      remaining term greater than 120 months exceeds 15% of the sum of the
      Discounted Balances of all Eligible Pool A Receivables at such
      time;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables with respect to which the related Contract has a
      Discounted Balance greater than $1,000,000 exceeds 50% of the sum of the
      Discounted Balances of all Eligible Pool A Receivables at such
      time;

                

        

         

         

        
          
            
            

          

          
            17

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables related to any one vendor of Equipment (or
      Affiliate thereof) at such time exceeds 35% of the sum of the Discounted
      Balances of all Eligible Pool A Receivables at such
    time;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables arising under a Contract which provides for a
      Balloon Payment or Put Payment, the amount of which is in excess of 34% of
      the original amount of the Scheduled Payments to be made under such
      Contract, exceeds 20% of the sum of the Discounted Balances of all
      Eligible Pool A Receivables at such
time;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables arising from Practice Acquisition Loan Contracts
      at such time exceeds 50% of the sum of the Discounted Balances of all
      Eligible Pool A Receivables at such time;
  and

                

        

         

        
          	
                   
      

                	
                  (viii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool A Receivables that are Stand Alone Working Capital Loans at such
      time exceeds 15% of the sum of the Discounted Balances of all Eligible
      Pool A Receivables at such
time.

                

        

         

        “Pool A
Receivable” means the rights to all payments from an Obligor under a
Pool A Contract, including, without limitation, any right to the payment
with respect to (i) Scheduled Payments, (ii) any prepayments or
overdue payments made with respect to such Scheduled Payments, (iii) any
Guaranty Amounts, (iv) any Insurance Proceeds, (v) any Servicing
Charges and (vi) any Recoveries.

         

        “Pool A Termination
Event” means the occurrence of any of the following events:

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      rolling weighted average of the Delinquency Rates in respect of any three
      consecutive Collection Periods, calculated by the Lender solely with
      respect to Pool A Receivables, exceeds
  3.5%;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      Annualized Default Rate, calculated by (or in a manner satisfactory to)
      the Lender solely with respect to Pool A Receivables, exceeds 4.0%;
      or

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      Pool A Annualized Net Loss Rate exceeds
3.5%.

                

        

         

        “Pool B Annualized Net Loss
Rate” means with respect to any Underlying Originator, as of any date of
determination at least three Collection Periods after the date that the
Pool B Receivable related to such Underlying Originator is Pledged
hereunder (the “Applicable Date”), an
amount (expressed as a percentage) equal to (i) the product of
(A) (x) the aggregate Discounted Balances of all Underlying Contracts
related to such Underlying Originator which were Eligible Underlying Contracts
at the time of the Pledge of the related Pool B Receivable hereunder and as
to which an Underlying Contract Event of Default has occurred during the six (or
such lesser number of Collection Periods since the Applicable Date) immediately
preceding Collection Periods minus
(y) recoveries received by the Underlying Originator during the six (or
such lesser number of Collection Periods since the Applicable Date) immediately
preceding Collection Periods and (B) 2 (if six or more Collection Periods
have occurred since the Applicable Date), 2.4 (if five Collection Periods have
occurred since the Applicable Date), 3 (if four Collection Periods have
occurred since the Applicable Date), 4 (if three Collection Periods have
occurred since the Applicable Date), 6 (if two Collection Periods have
occurred since the Applicable Date) or 12 (if one Collection Period has
occurred since the Applicable Date) divided by (ii) the aggregate
Discounted Balances of all Underlying Contracts related to such Underlying
Originator which are Eligible Underlying Contracts as of the first Business Day
of the six (or such lesser number of Collection Periods since the Applicable
Date) immediately preceding Collection Periods.

         

        
          
            
            

          

          
            18

            
              

            

          

          
            
            

          

        

        “Pool B Borrowing
Base” means, at any time, (x) the sum of the amounts calculated with
respect to each Eligible Pool B Receivable, equal to the least of:

         

              
(i)     the sum of (A) 92% of the aggregate Discounted
Balance of all related Underlying Contracts and (B) the amount of funds on
deposit in the Cash Reserve Account related to such Eligible Pool B
Receivable;

         

        
          	
                   
      

                	
                  (ii)

                	
                  100%
      of the Amortized Equipment Cost with respect to such Eligible Pool B
      Receivable at such time (calculated without giving effect to any
      associated amortized indirect costs related to the applicable Equipment)
      minus the Holdback Amount for such Eligible Pool B Receivable;
      or

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      Discounted Balance of such Eligible Pool B
  Receivable

                

        

         

        minus (y) the Pool B
Overconcentration Amount.

         

        “Pool B Contract”
means an Underlying Originator Loan Contract.

         

        “Pool B Loan” has
the meaning assigned to that term in Section 2.01.

         

        “Pool B Master Receivable
File” has the meaning assigned to that term in clause (c) of the
definition of “Receivable File”.

         

        “Pool B Micro Ticket
Receivables” means a Pool B Receivable related to equipment with an
original cost of less than $3000 and with respect to which the related Obligor
is an Obligor approved in writing by the Lender in its sole
discretion.

         

        “Pool B Net Eligible
Receivables Balance” means, at any time, (i) the Eligible
Pool B Receivables Balance at such time minus (ii) the
Pool B Overconcentration Amount at such time.

         

        “Pool B
Overconcentration Amount” means, at any time, (x) after the first
anniversary of the Closing Date or (y) the aggregate outstanding principal
balance of the Loans is greater than $35,000,000, without duplication, the sum
of:

         

        
          	
                   
      

                	
                  (i)

                	
                  an
      amount equal to the Global Overconcentration Amount at such time
      multiplied by a fraction the numerator of which is the aggregate
      Discounted Balances of all Eligible Pool B Receivables at such time
      and the denominator of which is the aggregate Discounted Balances of all
      Eligible Receivables at such time;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool B Receivables related to any one Underlying Originator (or
      Affiliate thereof) at such time exceeds
  $25,000,000;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool B Receivables related to any one Underlying Obligor (or
      Affiliate thereof) at such time exceeds
  $1,000,000;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible
      Pool B Receivables with respect which the related Contract has a
      remaining term greater than 84 months exceeds 20% of the sum of the
      Discounted Balances of all Eligible Pool B Receivables at such time;
      and

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      amount by which the sum of the Discounted Balances of all Eligible Pool B
      Receivables that are Pool B Micro Ticket Receivables at such time exceeds
      $15,000,000.

                

        

         

         

        
          
            
            

          

          
            19

            
              

            

          

          
            
            

          

        

         

        “Pool B
Receivable” means the rights to all payments from an Obligor under a
Pool B Contract, including, without limitation, any right to the payment
with respect to (i) Scheduled Payments and Underlying Scheduled Payments,
(ii) any prepayments or overdue payments made with respect to such
Scheduled Payments and Underlying Scheduled Payments, (iii) any Guaranty
Amounts, (iv) any Insurance Proceeds, (v) any Servicing Charges and
(vi) any Recoveries.

         

        “Pool B Termination
Event” means, with respect to an Underlying Originator, the occurrence of
any of the following events:

         

        
          	
                   
      

                	
                  (i)

                	
                  other
      than with respect to Pool B Micro Ticket Receivables, the rolling weighted
      average of the Underlying Delinquency Rates with respect to such
      Underlying Originator in respect of any three consecutive Collection
      Periods exceeds 8%;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  other
      than with respect to Pool B Micro Ticket Receivables, the Pool B
      Annualized Net Loss Rate with respect to such Underlying Originator in
      respect of any Collection Period exceeds
6%;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  other
      than with respect to Pool B Micro Ticket Receivables, the current amount
      of recourse, if any, against such Underlying Originator with respect to
      its obligations under the related Underlying Originator Loan Contract is
      less than 5% of the maximum amount of such
  recourse;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  with
      respect to Pool B Micro Ticket Receivables only, the rolling weighted
      average of the Underlying Delinquency Rates with respect to such
      Underlying Originator in respect of any three consecutive Collection
      Periods exceeds 10%;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  with
      respect to Pool B Micro Ticket Receivables only, the Pool B Annualized Net
      Loss Rate with respect to such Underlying Originator in respect of any
      Collection Period exceeds 25%;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  with
      respect to Pool B Micro Ticket Receivables only, the current amount of
      recourse, if any, against such Underlying Originator with respect to its
      obligations under the related Underlying Originator Loan Contract is less
      than 5% of the maximum amount of such recourse;
  or

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  the
      occurrence of any Bankruptcy Event in respect of such Underlying
      Originator.

                

        

         

        “Pool B Underlying Lease
File” has the meaning assigned to that term in clause (d) of the
definition of “Receivable File”.

         

        “Pool B Underlying Loan
File” has the meaning assigned to that term in clause (e) of the
definition of “Receivable File”.

         

        “Practice Acquisition Loan
Contract” means, collectively, (i) a “Term Note (Level
Payments)” together with the “Master Loan and Security Agreement” related
thereto and incorporated by reference therein, each in the form attached hereto
as Exhibit D-3 (as
such exhibit may be updated from time to time by the Borrower with the consent
of the Lender) or a “Finance
Agreement” in one of the forms attached as Exhibit D-2(c) (as such exhibit
may be updated from time to time by the Borrower with the consent of the Lender)
or (ii) a loan agreement and promissory note otherwise approved by the
Servicer in compliance with the Credit and Collection Policy as to which the Servicer has
notified the Collateral Agent in writing, in each case, pursuant to which
Originator makes a loan to an Obligor to enable such Obligor to acquire a
dental, medical, osteopathic medical, optometric or veterinary practice, secured
by Equipment related to the practice of dentistry, medicine or veterinary
medicine and certain non-equipment assets, together with all schedules,
supplements and amendments thereto and each other document and instrument
related thereto.

         

        “Prepayment Amount”
means the principal amount of Loans repaid by the Borrower in connection with an
optional prepayment of Loans made by the Borrower pursuant to Section 2.15
hereof.

         

        
          
            
            

          

          
            20

            
              

            

          

          
            
            

          

        

         

        “Prepayment Date”
means any date on which an optional prepayment of Loans is made by the Borrower
pursuant to Section 2.15
hereof.

         

        “Prepayment Premium”
has the meaning ascribed thereto in the Fee Letter.

         

        “Program Termination Cure
Event” means the occurrence of any of the following events:

         

              
(i)     following the occurrence of a Program
Termination Event described in clause (iv), (v), (vi), (vii), (viii) or
(ix) of the definition thereof, such Program Termination Event is cured within
the following two Collection Periods and two further Collection Periods pass
without the occurrence of such a Program Termination Event; or

         

        
          	
                   
      

                	
                  (ii)

                	
                  following
      the occurrence of a Program Termination Event described in
      clause (xi) of the definition thereof, such Program Termination Event
      is cured;

                

        

         

        provided that, in any
event, no other Program Termination Event shall have occurred and be
continuing.

         

        “Program Termination
Date” means the earliest of (i) the date of occurrence of any event
described in Section 7.01(a)
hereof, (ii) the date of the declaration of the Program Termination Date
pursuant to any other subsection of Section 7.01 or
(iii) the date of the declaration of the Program Termination Date by, and
at the option of, the Lender upon the occurrence of a Program Termination
Event.

         

        “Program Termination
Event” means the occurrence of any of the following events:

         

        
          	
                   
      

                	
                  (i)

                	
                  a
      regulatory, tax or accounting body has ordered that the activities of the
      Lender or any Affiliate thereof contemplated hereby be terminated or, as a
      result of any other event or circumstance, the activities of the Lender or
      any Affiliate contemplated hereby may reasonably be expected to cause the
      Lender or the Person, if any, then acting as the administrator or the
      manager for the Lender or any of its Affiliates to suffer materially
      adverse regulatory, accounting or tax
  consequences;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  an
      Event of Default has occurred and is
continuing;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      Facility Maturity Date shall have
occurred;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  other
      than with respect to Pool B Micro Ticket Receivables, the Annualized
      Default Rate exceeds 4.5%;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  other
      than with respect to Pool B Micro Ticket Receivables, the rolling weighted
      average of the Delinquency Rates in respect of any three consecutive
      Collection Periods exceeds 4.0%;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  other
      than with respect to Pool B Micro Ticket Receivables, the Annualized Net
      Loss Rate exceeds 4.0%;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  with
      respect to Pool B Micro Ticket Receivables only, the Annualized Default
      Rate exceeds 25.0%;

                

        

         

        
          	
                   
      

                	
                  (viii)

                	
                  with
      respect to Pool B Micro Ticket Receivables only, the rolling weighted
      average of the Delinquency Rates in respect of any three consecutive
      Collection Periods exceeds 10.0%;

                

        

         

        
          	
                   
      

                	
                  (ix)

                	
                  with
      respect to Pool B Micro Ticket Receivables only, the Annualized Net Loss
      Rate exceeds 25.0%;

                

        

         

        
          	
                   
      

                	
                  (x)

                	
                  a
      Servicer Default has occurred and is continuing;
  or

                

        

         

        
          
            
            

          

          
            21

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (xi)

                	
                  (1) any
      Qualifying Swap Counterparty ceases to maintain the long-term debt ratings
      required of a Qualifying Swap Counterparty and (A) does not post cash
      collateral in a manner acceptable to the Lender within 45 days and
      (B) is not replaced within 45 days by a replacement acceptable
      to the Lender or (2) the Borrower fails to comply with any term,
      covenant or agreement hereunder related to the maintenance of any
      Qualifying Interest Rate Swaps; or

                

        

         

        
          	
                   
      

                	
                  (xii)

                	
                  the
      occurrence of three or more Pool A Termination Events and/or
      Pool B Termination Events.

                

        

         

        
          	
                   
      

                	
                  “Purchase and Sale
      Agreement” means that certain Purchase and Sale Agreement, dated as
      of the date hereof, between the Originator, as seller, and the Borrower,
      as purchaser, together with all instruments, documents and agreements
      executed in connection therewith, as such Purchase and Sale Agreement may
      from time to time be amended, supplemented or otherwise modified in
      accordance with the terms hereof.

                

        

         

        “Purchase Date” has
the meaning set forth in the Purchase and Sale Agreement.

         

        “Put Payment” means
with respect to any Contract or Underlying Contract constituting a lease, the
payment, if any, required to be made by the Obligor under the terms of such
lease in connection with the required purchase by such Obligor or Underlying
Obligor of the related Equipment or Underlying Equipment at the end of the term
of such lease.

         

        “QSC Subordinated Termination
Payment” means a termination payment required to be made
by  the Borrower to a Qualifying Swap Counterparty upon the
termination of the related Qualifying Interest Rate Swap pursuant to an event of
default or termination event (other than Illegality or Tax Event) (each as
defined in the related Qualifying Interest Rate Swap) as to which the Qualifying
Swap Counterparty was the defaulting party or the sole affected party under the
Qualifying Interest Rate Swap.

         

        “Qualifying Interest Rate
Swap” means (X) an interest rate swap agreement (i) between the
Borrower and a Qualifying Swap Counterparty, (ii) under which the Borrower
shall receive a floating rate of interest based on a Eurodollar Index acceptable
to the Lender in exchange for the payment by the Borrower of a fixed rate of
interest equal to the applicable Swapped Rate, (iii) the effective date of
which is a Borrowing Date, (iv) having a varying notional balance which is,
as of the effective date thereof, in an amount equal to the aggregate principal
amount of the Loans advanced on such effective date and (v) which shall
otherwise be on such terms and conditions and pursuant to such documentation as
shall be acceptable to the Lender or (Y) an alternative interest rate
hedging agreement agreed to in writing by the Borrower and the
Lender.

         

        “Qualifying Swap
Counterparty” means Morgan Stanley Capital Services Inc. (or any
successors or permitted assigns) or any other financial institution that is in
the business of entering into interest rate swap transactions, is acceptable to
the Lender and has a long-term senior unsecured debt rating of “A” or higher (or
the equivalent) by each Rating Agency then rating such long-term senior
unsecured debt) or posts cash collateral in a manner and amount satisfactory to
the Lender.

         

        “Rating Agencies”
means Moody’s, S&P and Fitch, or any other nationally recognized statistical
rating organizations as may be designated by the Lender.

         

        “Real Estate Contract”
means a loan agreement and promissory note, finance agreement or similar
agreement, in each case, (i) in a form approved by the Servicer in
compliancein writing by
the Lender (in its reasonable discretion) and that is consistent with the
Credit and Collection Policy, in each
case, and (ii)
pursuant to which the Originator makes a loan to an Obligor secured by rentals
or other receivables arising from the use of real property, together with all
schedules, supplements and amendments thereto and each other document and
instrument related thereto.

         

        “Receivable” means a
Pool A Receivable or a Pool B Receivable.

         

        “Receivable File”
means with respect to each Receivable:

         

        
          
            
            

          

          
            22

            
              

            

          

          
            
            

          

        

         

        (a) if
such Receivable is related to a Lease Contract the following items
(collectively, a “Pool
A Lease File”):

         

        
          	
                   
      

                	
                  (i)

                	
                  (1) the
      related original, executed Lease Contract (or, in the case of a Lease
      Contract under a master lease, a machine or facsimile copy of the related
      master lease certified by an authorized officer of the Borrower and
      stamped “I hereby certify that this is a true and exact copy of the
      original” and an original, executed schedule thereto describing the
      related Equipment) unless such Lease
      Contract is related to an Exception Sublimit Receivable, in which event
      the executed Lease Contract (or, in the case of Lease Contracts under a
      master lease, the related schedule) may be a machine or facsimile copy
      certified in the manner described above, (2) a true, executed copy of
      the related delivery/installation certificate or acknowledgment and
      acceptance of delivery certificate if such Receivable is related to
      Equipment with an original cost in excess of $50,000, (3) a true copy
      of the  Insurance Certificate if such Receivable is related to
      Equipment with an original cost in excess of $100,000, (4) other than
      with respect to a Lease Contract related to Equipment which has an
      original cost of less than $25,000 if such Lease Contract is a Dollar
      Purchase Option Contract or $50,000 if such Lease Contract is a FMV
      Contract, a “transmittal order” from the Servicer to a filing service
      company and an “in process report” from such filing service company to the
      Servicer (or other evidence of the submission of the related UCC financing
      statement for filing in the appropriate filing office) and, within
      45 days of the related Contract being executed, a file-stamped copy
      of the related UCC financing statement and (5) vendor order(s) or
      invoice(s); and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  copies
      of any additional documents, other than servicing related documents, that
      the Borrower keeps on file with respect to such
  Receivable;

                

        

         

        (b) if
such Receivable is related to a Loan Contract or a Practice Acquisition Loan
Contract  the following items (collectively, a “Pool A Loan
File”):

         

        
          	
                   
      

                	
                  (i)

                	
                  (1) the
      original, if a
      promissory note was executed by the related Obligor in connection with
      such Loan Contract or Practice Acquisition Loan Contract, the original of
      such executed promissory note (with a fully executed,
      original Allonge attached thereto); provided that, with regard to
      any “Finance Agreement”, no executed promissory note or fully executed,
      original Allonge need be included, (2) a true, executed copy
      of the related “Master Loan and Security Agreement”, “Finance Agreement” or
      similar agreement pursuant to which the Originator made the related loan
      to the related Obligor (and any amendments thereto), (3) a
      true copy of the related Insurance Certificate if such Receivable is
      related to Equipment with an original cost in excess of $100,000 and
      (4) other than with respect to a Receivable related to Equipment
      which has an original cost of less than $25,000, a “transmittal order”
      from the Servicer to a filing service company and an “in process report”
      from such filing service company to the Servicer (or other evidence of the
      submission of the related UCC financing statement for filing in the
      appropriate filing office) and, within 45 days of the related
      Contract being executed, a file-stamped copy of the related UCC financing
      statement; and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  copies
      of any additional documents, other than servicing related documents, that
      the Borrower keeps on file with respect to such
  Receivable;

                

        

         

        (c) if
such Receivable is related to an Underlying Originator Loan Contract the
following items (collectively, a “Pool B Master Receivable
File”):

         

        
          	
                   
      

                	
                  (i)

                	
                  (1) the
      original,if a
      promissory note was executed by the related Obligor in connection with
      such Underlying Originator Loan Contract, the original of such
      executed promissory note (with a fully executed,
      original Allonge attached thereto) unless such
      Underlying Originator Loan Contract is in the form of a “Master Purchase
      and Sale Agreement,; provided that, with regard to
      any “Finance Agreement”, no executed promissory note
      or fully executed, original Allonge need be included, (2) a
      true, executed copy of the related security agreement unless such
      Underlying Originator Loan Contract is in the form of a “Master Purchase
      and Sale Agreement” that, “Finance Agreement” or such
      other form of agreement approved in writing by the Lender (in its
      reasonable discretion) that, in any case, includes language
      granting to the purchaser thereunder a security interest in all the
      related Underlying Originator Loan Collateral and other property pledged
      by the related Obligor to secure its obligations under such Underlying
      Originator Loan Contract, and (3) a “transmittal order” from the Servicer
      to a filing service company and an “in process report” from such filing
      service company to the Servicer (or other evidence of the submission of
      the related UCC financing statement for filing in the appropriate filing
      office) and, within 45 days of the related Contract being executed, a
      file-stamped copy of the related UCC financing statement;
      and

                

        

         

         

        
          
            
            

          

          
            23

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  copies
      of any additional documents, other than servicing related documents, that
      the Borrower keeps on file with respect to such
  Receivable;

                

        

         

        (d) if
such Receivable is related to a Underlying Originator Loan Contract which
finances an Underlying Lease Contract the following items (collectively, a
“Pool B Underlying
Lease File”):

         

        
          	
                   
      

                	
                  (i)

                	
                  (1) the
      related original, executed Underlying Lease Contract (or, in the case of
      an Underlying Lease Contract under a master lease, a machine or facsimile
      copy of the related master lease certified by an authorized officer of the
      Borrower and stamped “I hereby certify that this is a true and exact copy
      of the original” and an original, executed schedule thereto describing the
      related Equipment) and (2) other than with respect to an Underlying
      Lease Contract related to Equipment which has an original cost of less
      than $25,000 if such Underlying Lease Contract is a Dollar Purchase Option
      Contract or $50,000 if such Underlying Lease Contract is a FMV Contract, a
      “transmittal order” from the Underlying Originator to a filing service
      company and an “in process report” from such filing service company to the
      Underlying Originator (or other evidence of the submission of the related
      UCC financing statement for filing in the appropriate filing office) and,
      within 45 days of the related Underlying Lease Contract being
      executed, a file-stamped copy of the related UCC financing statement;
      and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  copies
      of any additional documents, other than servicing related documents, that
      the Borrower keeps on file with respect to such
  Receivable;

                

        

         

        (e) if
such Receivable is related to an Underlying Originator Loan Contract which
finances an Underlying Loan Contract the following items (collectively, a “Pool B Underlying Loan
File”):

         

        
          	
                   
      

                	
                  (i)

                	
                  (1) the
      original, executed promissory note (with fully executed, original Allonge
      attached thereto), (2) a true, executed copy of the related security
      agreement and (3) other than with respect to an Underlying Loan
      Contract related to Equipment which has an original cost of less than
      $25,000 a “transmittal order” from the Underlying Originator to a filing
      service company and an “in process report” from such filing service
      company to the Underlying Originator (or other evidence of the submission
      of the related UCC financing statement for filing in the appropriate
      filing office) and, within 45 days of the related Contract being
      executed, a file-stamped copy of the related UCC financing statement;
      and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  copies
      of any additional documents, other than servicing related documents, that
      the Borrower keeps on file with respect to such
  Receivable.

                

        

         

        In
addition, if the Obligor Collateral related to such Receivable is a Vehicle, the
related Receivable File shall include the original copy of the Certificate of
Title with respect to such Vehicle, which such Certificate of Title satisfies
the Titling Requirements or (prior to the 90th day after such Receivable
was first included in the calculation of the Eligible Receivables Balance, if
such Certificate of Title has not yet been received by the Servicer or the
Borrower) a copy of the application for such Certificate of Title.

         

        “Receivables Schedule”
has the meaning assigned to that term in the Custodial Agreement.

         

         

        
          
            
            

          

          
            24

            
              

            

          

          
            
            

          

        

         

        “Records” means all
documents, books, records and other information (including, without limitation,
tapes, disks, punch cards and related property and rights) maintained with
respect to Receivables and the related Obligors which the Borrower has itself
generated, in which the Borrower has acquired an interest pursuant to the
Purchase and Sale Agreement or in which the Borrower has otherwise obtained an
interest.

         

        “Recoveries” means,
for any Collection Period during which, or any Collection Period after the date
on which, any Receivable becomes a Defaulted Receivable and with respect to such
Defaulted Receivable, all payments

         

        that the
Servicer received from or on behalf of the related Obligor during such
Collection Period in respect of such Defaulted Receivable or from the
repossession, liquidation or re-leasing of the related Obligor Collateral,
including but not limited to Scheduled Payments, Overdue Payments, Guaranty
Amounts and Insurance Proceeds.

         

        “Registrar of Titles”
means with respect to any State, the governmental agency or body responsible for
the registration of, and the issuance of certificates of title relating to,
motor vehicles and liens thereon.

         

        “Related Security”
means with respect to any Receivable:

         

        
          	
                   
      

                	
                  (i)

                	
                  any
      and all security interests or liens and property subject thereto from time
      to time securing or purporting to secure payment of such
      Receivable;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  all
      guarantees, indemnities, warranties, letters of credit, insurance policies
      and proceeds and premium refunds thereof and other agreements or
      arrangements of whatever character from time to time supporting or
      securing payment of such Receivable;
and

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  all
      proceeds of the foregoing.

                

        

         

        “Release Price” means,
with respect to a Pledged Receivable to be released hereunder, an amount equal
to the Discounted Balance of such Pledged Receivable at the time of such release
plus interest
accrued thereon at the Discount Rate from and including the Remittance Date
immediately preceding the date such Pledged Receivable is to be released through
(but not including) the next succeeding Remittance Date.

         

        “Remittance Date”
means the twenty-third (23rd) day of
each month beginning December, 2006, or, if such date is not a Business Day, the
next succeeding Business Day; provided, that the final Remittance Date shall
occur on the Collection Date.

         

        “Resource America”
means Resource America, Inc., a Delaware corporation.

         

        “Rollover Interest
Period” means any Interest Period other than any Interest Period
(i) applicable to the Loan arising as a result of the Borrowing on the
initial Borrowing Date or (ii) applicable to any new Loan arising as a
result of a Borrowing on a Subsequent Borrowing Date.

         

        “S&P” means
Standard & Poor’s Ratings Group, a division of The McGraw-Hill Companies,
Inc. (or its successors in interest).

         

        “Scheduled Payments”
means, with respect to any Receivable, the periodic payments payable under the
terms of the related Contract (but not including any such periodic payment to
the extent paid in advance by the related Obligor).

         

        “Secured Parties”
means the Lender, the Servicer, the Backup Servicer, the Custodian, the Lender’s
Bank, each Qualified Swap Counterparty and their respective successors and
assigns.

         

        “Security Deposit”
means any amount paid to the Servicer or the Borrower by an Obligor as a
security deposit or as a payment in advance of any amounts to become due under a
Contract, which has not previously been refunded to such Obligor or applied
toward such Obligor’s obligations under such Contract (for purposes of
clarification, a Cash Reserve shall not be deemed to constitute a Security
Deposit).

         

        
          
            
            

          

          
            25

            
              

            

          

          
            
            

          

        

         

        “Security Deposit
Account” has the meaning assigned to that term in Section 2.05.

         

        “Security Deposit Account
Agreement” means that certain Securities Account Agreement, dated the
date of this Agreement, among the Borrower, the Servicer, the Lender’s Bank and
the Lender, as such agreement may from time to time be amended, supplemented or
otherwise modified in accordance with the terms thereof.

         

        “Servicer” means, at
any time, LEAF Financial or any other Person then authorized, pursuant to Section 6.01, to
service, administer and collect Pledged Receivables.

         

        “Servicer Advance” has
the meaning assigned to such term in Section 6.19.

         

        “Servicer Default”
means the occurrence of any of the following events:

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      failure of the Servicer to deliver any payments, collections or proceeds
      which it is obligated to deliver under the terms hereof or of any other
      Transaction Document at the times it is obligated to make such deliveries
      under the terms hereof or of any other Transaction Document, and such
      failure remains unremedied for two Business
  Days;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      failure of the Servicer to satisfy any of its reporting, certification,
      notification or documentation requirements under the terms hereof or of
      any other Transaction Document or the failure of the Servicer to observe
      or perform any material term, covenant or agreement hereunder or under any
      other Transaction Document (other than those described in clause (i)
      above) and such failure shall remain unremedied for 10 days after the
      Servicer first has knowledge, whether constructive or actual, of such
      failure;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  any
      representation, warranty or statement of the Servicer made herein or in
      any other Transaction Document shall prove to be incorrect in any material
      respect, and, solely if such incorrect representation, warranty or
      statement can be remedied, such representation, warranty or statement is
      not made true within 15 days;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  the
      occurrence of an Event of Default;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      occurrence of a Program Termination Event described in clauses (iv),
      (v), (vi), (vii), (viii), (ix) or (xii) of the definition of Program
      Termination Events; or

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  the
      occurrence of any Bankruptcy Event in respect of the
    Servicer.

                

        

         

        “Servicer Pension
Plan” means a “pension plan” as such term is defined in section 3(2) of
ERISA, which is subject to title IV of ERISA and to which the Servicer or any
ERISA Affiliate of Servicer may have any liability, including any liability by
reason of having been a substantial employer within the meaning of section 4063
of ERISA at any time during the preceding five years, or by reason of being
deemed to be a contributing sponsor under section 4069 of ERISA.

         

        “Servicing Charges”
means the sum of (a) all late payment charges paid by Obligors under
Contracts after payment in full of any Scheduled Payments due in a prior
Collection Period and Scheduled Payments for the related Collection Period and
(b) any other incidental charges or fees received from an Obligor,
including, but not limited to, late fees, collection fees, taxes and charges for
insufficient funds.

         

        “Servicing Fee” means,
for any Fee Period, an amount, payable out of Collections on the Pledged
Receivables and amounts applied to the payment of, or treated as payments on,
the Pledged Receivables, equal to (i) the Servicing Fee Rate multiplied by
(ii) the Net Eligible Receivables Balance as of the first day of such Fee
Period multiplied by (iii) a fraction, the numerator of which shall be the
actual number of days in such Fee Period and the denominator of which shall be
360.  Upon assuming the duties of the Servicer hereunder, the Backup
Servicer shall also be entitled to receive a one-time acceptance fee of $60,000,
which shall be considered part of the “Servicing Fee” hereunder but shall be in
addition to the amount set forth in the sentence above.

         

        
          
            
            

          

          
            26

            
              

            

          

          
            
            

          

        

         

        “Servicing Fee Rate”
means 1.00%.

         

        “Stand Alone Working Capital
Loan” means a loan to a dental, medical, osteopathic medical, optometric
or veterinary practice that may be secured by all assets of such dental,
medical, osteopathic medical, optometric or veterinary practice or that might be
unsecured.

         

        “Standby Backup Servicer’s
Fee” means, for any Fee Period or portion thereof prior to the occurrence
of a Servicer Default and the appointment of the Backup Servicer as Servicer
hereunder, an amount, payable out of Collections on the Pledged Receivables and
amounts applied to the payment of, or treated as payments on, the Pledged
Receivables, equal to the greater of (i) the Standby Backup Servicing Fee Rate,
multiplied by the Net Eligible Receivables Balance as of the first day of such
Fee Period, multiplied by a fraction, the numerator of which shall be the actual
number of days in such Fee Period and the denominator of which shall be 360, or
(ii) $1,500.  The “Standby Backup Servicer’s Fee” shall also include
(i) a one-time acceptance fee of $4,000 payable on the Closing Date and (ii)
reasonable out-of-pocket expenses incurred by the Standby Backup Servicer in the
performance of its duties.

         

        “Standby Backup Servicing Fee
Rate” means .0215%.

         

        “State” means one of
the fifty states of the United States or the District of Columbia.

         

        “Subsequent Borrowing”
means a Borrowing which occurs on a Subsequent Borrowing Date.

         

        “Subsequent Borrowing
Date” means each Business Day occurring after the initial Borrowing Date
on an additional Borrowing is funded from the Lender to the
Borrower.

         

        “Swapped Rate” means,
with respect to any Qualifying Interest Rate Swap, the annual rate of interest
(expressed as a percentage) which the Borrower, as the fixed-rate payor, is
required to pay under such Qualifying Interest Rate Swap in order to receive the
floating rate of interest provided for under such Qualifying Interest Rate
Swap.

         

        “Tangible Net Worth”
means, with respect to any Person, the amount calculated in accordance with GAAP
as (i) the consolidated net worth of such Person and its consolidated
subsidiaries (excluding, solely
with respect to the Owner and only to the extent otherwise included in such
consolidated net worth, any mark-to-market gain or loss on any swap or other
hedge transaction of the Owner and its consolidated subsidiaries), plus (ii) to the
extent not otherwise included in such consolidated net worth, unsecured
subordinated Debt of such Person (and, solely with respect to the
Owner and only to the extent not otherwise included in such consolidated net
worth, (x) intercompany Debt of the Owner and (y) the aggregate outstanding
principal balance of the Owner Secured Recourse Promissory Notes held by Persons
that are not Affiliates of the Owner) and its consolidated subsidiaries,
the terms and conditions of which are reasonably satisfactory to the Lender,
minus
(iii) the consolidated intangibles of such Person and its consolidated
subsidiaries, including, without limitation, goodwill, trademarks, tradenames,
copyrights, patents, patent allocations, licenses and rights in any of the
foregoing and other items treated as intangibles in accordance with
GAAP.

         

        “Titling Requirements”
means that:

         

        
          	
                   
      

                	
                  (i)

                	
                  in
      the case of any Vehicle leased or sold to an Obligor pursuant to a Pool A
      Contract, the Certificate of Title for such Vehicle indicates the Obligor,
      as owner, and the Borrower or an Approved Lienholder, as
      lienholder;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  in
      the case of any Vehicle leased or sold to an Underlying Obligor pursuant
      to an Underlying Contract, the Certificate of Title for such Vehicle
      indicates the Underlying Obligor, as owner, and an Approved Lienholder, as
      lienholder.

                

        

         

         “Transaction
Documents” means this Agreement, the Purchase and Sale Agreement, the
Lockbox Intercreditor Agreement, the Collection Account
Agreement, the Security Deposit Account Agreement, each Cash Reserve Account
Agreement, the Fee Letter, the Custodial Agreement, the Originator Insurance
Agreement, any lease bailment agreement with a sub-custodian and each Qualifying
Interest Rate Swap and each document and instrument related to any of the
foregoing.

         

        
          
            
            

          

          
            27

            
              

            

          

          
            
            

          

        

         

        “Transition Costs”
means any documented expenses and allocated cost of personnel reasonably
incurred by the Backup Servicer in connection with a transfer of servicing from
the Servicer to the Backup Servicer as the successor Servicer; provided, that
such expenses and allocated costs do not exceed $60,000.

         

        “UCC” means the
Uniform Commercial Code as from time to time in effect in the specified
jurisdiction.

         

        “Underlying
Collateral” means the Underlying Equipment leased or sold to an
Underlying Obligor, or serving otherwise as collateral for a loan to an
Underlying Obligor under an Underlying Contract.

         

        “Underlying Contract”
means an Underlying Lease Contract or an Underlying Loan Contract.

         

        “Underlying Contract Event of
Default” means, as of any time of determination, the occurrence and
continuation of any of the following events with respect to any Underlying
Contract:

         

        
          	
                   
      

                	
                  (i)

                	
                  any
      Underlying Scheduled Payment (or other amount payable under the terms of
      the related Underlying Contract) remains unpaid for more than
      120 days after the due date therefor set forth in such Underlying
      Contract;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      first or second Underlying Scheduled Payment is not paid in full when due
      under the related Underlying
Contract;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  any
      payment or other material terms of the related Underlying Contract have
      been modified due to credit related reasons after such Underlying Contract
      was acquired by Originator;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  such
      Underlying Contract has been or should be charged off as a result of the
      occurrence of a Bankruptcy Event with respect to the related Underlying
      Obligor, if any, or has been or should otherwise be deemed uncollectible
      by the Underlying Originator in accordance with its credit and collection
      policy; or

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      related Underlying Equipment has been
  repossessed.

                

        

         

        “Underlying Delinquency
Rate” means with respect to any Underlying Originator, as of any date of
determination, an amount (expressed as a percentage) equal to (i) the
aggregate Discounted Balances of all Underlying Contracts related to such
Underlying Originator as to which any part of any Underlying Scheduled Payment
(or other amount payable under the terms of the related Underlying Contract)
remains unpaid for more than 30 days but not more than 120 days after
the due date therefor set forth in such Underlying Contract as of the last day
of the immediately preceding Collection Period divided by (ii) the
aggregate Discounted Balances with respect to all Eligible Pool B
Underlying Lease Contracts and Eligible Pool B Underlying Loan Contracts
related to such Underlying Originator as of such day.

         

        “Underlying Equipment”
means the equipment or Vehicle leased or sold to an Underlying Obligor by an
Underlying Originator, or serving as collateral for a loan to an Underlying
Obligor by an Underlying Originator, under an Underlying Contract together with
any replacement parts, additions and repairs thereof, and any accessories
incorporated therein and/or affixed thereto.

         

        “Underlying Insurance
Certificate” means with respect to any Pool B Receivable, the
insurance certificate related to the Underlying Insurance Policy with respect to
the Underlying Contract relating to such Receivable (which insurance certificate
shall list the Originator or the Underlying
Originator as the loss payee).

         

        “Underlying Insurance
Policy” means, with respect to any Underlying Collateral, the insurance
policy maintained by or on behalf of the Obligor pursuant to the related
Contract that covers physical damage to the related Equipment (in an amount
sufficient to insure completely the value of such Equipment) and general
liability (including policies procured by the Borrower or the Servicer, or any
agent thereof, on behalf of the Obligor).

         

        
          
            
            

          

          
            28

            
              

            

          

          
            
            

          

        

         

        “Underlying Lease
Contract” means a lease contract, finance agreement and/or similar
agreement(s) (in any case, which is in the form of a lease) pursuant to
which Underlying Equipment is leased to an Underlying Obligor by an Underlying
Originator, together with all schedules, supplements and amendments thereto and
each other document and instrument related to such lease contract.

         

        “Underlying Lease
Documents” means, with respect to any Pool B Receivable, the
Underlying Lease Contract and all agreements, documents or instruments
evidencing, securing, guaranteeing or otherwise relating to the obligations of
the Underlying Obligor thereunder.

         

        “Underlying Loan
Contract” means, collectively, a promissory note, a loan agreement and a, finance agreement, security
agreement and/or similar
agreement(s), pursuant to which an Underlying Originator makes a loan to
an Underlying Obligor secured by Underlying Equipment owned by such Underlying
Obligor, together with all schedules, supplements and amendments thereto and
each other document and instrument related thereto.

         

        “Underlying Loan
Documents” means, with respect to any Pool B Receivable, the
Underlying Loan Contract and all agreements, documents or instruments
evidencing, securing, guaranteeing or otherwise relating to the obligations of
the Underlying Obligor thereunder, including, without limitation, the note or
notes evidencing such indebtedness.

         

        “Underlying Obligor”
means, collectively, each Person obligated to make payments under an Underlying
Contract.

         

        “Underlying
Originator” means an Obligor engaged, in the ordinary course of business
in providing financing to Underlying Obligors for the purposes of acquiring
Underlying Equipment.

         

        “Underlying Originator Credit
and Collection Policy” means the credit and collection policy of an
Underlying Originator, as such policy may hereafter be amended, modified or
supplemented from time to time in compliance with this Agreement.

         

        “Underlying Originator Loan
Collateral” means Underlying Loan Contracts and Underlying Lease
Contracts and all other assets of the Underlying Originators which secure the
obligations of Underlying Originators under an Underlying Originator Loan
Contract, or which are sold to the Originator by Underlying Originators under an
Underlying Originator Loan Contract, in each case whether now owned or hereafter
acquired, and including without limitation the Underlying Loan Documents, the
Underlying Lease Documents, Underlying Security Deposit (if any) and the
Underlying Equipment related thereto, together with all proceeds of every kind
and nature, including proceeds of proceeds, of any and all of the
foregoing.

         

        “Underlying Originator Loan
Contract” means, collectively, a “Master Purchase and Sale Agreement,” a
“Master Loan and Security Agreement,” or a “Loan and
Security Agreement,” a “Finance
Agreement” or similar agreement in a form approved in writing by the Lender (in
its reasonable discretion), each of which complies with all of the
criteria set forth in Exhibit D-4
hereto (as such exhibit may be updated from time to time by the Borrower with
the consent of the Lender), pursuant to which Originator makes a purchase of
Underlying Originator Loan Collateral from an Underlying Originator or makes a
loan to an Underlying Originator secured by Underlying Originator Loan
Collateral, together with all schedules, supplements and amendments thereto and
each other document and instrument related thereto.

         

        “Underlying Scheduled
Payments” means, with respect to any Underlying Contract, the periodic
payments payable under the terms of such Underlying Contract (but not including
any such periodic payment to the extent paid in advance by the related
Underlying Obligor).

         

        “Underlying Security
Deposit” means any amount paid to an Underlying Originator by an
Underlying Obligor as a security deposit or as a payment in advance of any
amounts to become due under an Underlying Contract, which has not previously
been refunded to such Underlying Obligor or applied toward such Underlying
Obligor’s obligations under such Underlying Contract.

         

        
          
            
            

          

          
            29

            
              

            

          

          
            
            

          

        

         

        “United States” means
the United States of America.

         

        “Unmatured Event of
Default” means any event that, if it continues uncured, will, with lapse
of time or notice or lapse of time and notice, constitute an Event of
Default.

         

        “Vehicle” means a new
or a used automobile, minivan, sports utility vehicle, light duty truck or heavy
duty truck.

         

        “Weighted Average Swapped
Rate” means, as of any date of determination, the weighted average
(weighted solely based on the Calculated Swap Amortizing Balances of such
Qualifying Interest Rate Swaps as of such date of determination) of the Swapped
Rates of the Qualifying Interest Rate Swaps in effect on such date of
determination.

         

        SECTION
1.02 Other
Terms.  All accounting terms not specifically defined herein
shall be construed in accordance with GAAP.  All terms used in Article
9 of the UCC in the State of New York, and not specifically defined herein, are
used herein as defined in such Article 9.

         

        SECTION
1.03 Computation
of Time Periods.  Unless otherwise stated in this Agreement, in
the computation of a period of time from a specified date to a later specified
date, the word “from” means “from and including” and the words “to” and “until”
each mean “to but excluding.”

         

        
          	
                   
      

                	
                  ARTICLE
      II.

                

        

         

        

         

        
          	
                   
      

                	
                  THE
      RECEIVABLES FACILITY

                

        

         

        SECTION
2.01 Borrowings.  On
the terms and conditions hereinafter set forth, the Lender shall make loans
(“Loans”) to
the Borrower secured by Pledged Assets from time to time during the period from
the date hereof until the earlier of the Program Termination Date or the
Facility Maturity Date. Separate Loans will be made to finance the Borrower’s
acquisition of (x) Pool A Receivables (“Pool A Loans”)
and (y) Pool B Receivables (“Pool B Loans”),
and no Loan shall finance both Pool A Receivables and Pool B
Receivables.  Under no circumstances shall the Lender make, or the
Borrower request, any Loan if (a) the principal amount of such Loan is less
than (i) with respect to the initial Borrowing only, $10,000,000 and (ii) with
respect to any Subsequent Borrowing, $500,000, or (b) after giving effect
to the Borrowing of such Loan, either (i) a Program Termination Event or an
event that but for notice or lapse of time or both would constitute a Program
Termination Event has occurred and is continuing or (ii) the aggregate
Facility Amount hereunder would exceed the lesser of (A) the Borrowing
Limit and (B) the Borrowing Base.  Under no circumstances shall
the Lender make, or the Borrower request, any Loan secured by Pool A
Receivables if after giving effect to the Borrowing of such Loan, either
(1) the aggregate Facility Amount hereunder, calculated solely with respect
to Loans secured by Pool A Receivables, would exceed the Pool A
Borrowing Base or (2) a Pool A Termination Event shall
exist.  Under no circumstances shall the Lender make, or the Borrower
request, any Loan secured by any Pool B Receivable if after giving effect
to the Borrowing of such Loan, either (1) the aggregate Facility Amount
hereunder, calculated solely with respect to Loans secured by Pool B
Receivables, would exceed the Pool B Borrowing Base or (2) a Pool B
Termination Event shall exist with respect to the Underlying Originator related
to such Pool B Receivable.

         

        SECTION
2.02 The Initial Borrowing and Subsequent Borrowings.

         

        (a) Until
the occurrence of the earlier of the Program Termination Date and the Facility
Maturity Date, the Lender will make Loans on any Business Day at the request of
the Borrower, subject to and in accordance with the terms and conditions of
Sections 2.01
and 2.02 and
subject to the provisions of Article III
hereof.

         

        (b) (i)   The
initial Borrowing shall be made on at least five (5) Business Days’ irrevocable
written notice from the Borrower to the Lender and each Subsequent Borrowing
shall be made on at least three (3) Business Days’ irrevocable written notice
from the Borrower to the Lender (any such written notice, a “Notice of
Borrowing”), provided that such Notice of Borrowing is received by the
Lender no later than 12:00 noon (New York City time) on the Business Day of
receipt.  Any Notice of Borrowing received after 12:00 noon (New York
City time) shall be deemed
received prior to 12:00 noon (New York City time) on the following Business
Day.  Each such Notice of Borrowing shall specify (A) the
aggregate amount of such Borrowing, (B) the date of such Borrowing,
(C) the allocation of the Loans as Pool A Loans and Pool B Loans,
and (D) the Eligible Pool A Receivables and the Eligible Pool B
Receivables to be Pledged in connection with such Borrowing (and upon such
Borrowing, such Receivables shall be Pledged Receivables
hereunder).  On the date of each Borrowing, the Lender shall, upon
satisfaction of the applicable conditions set forth in Article III,
make available to the Borrower on the applicable Borrowing Date, no later than
2:00 P.M. (New York City time), in same day funds, the amount of such Borrowing
(net of amounts payable to or for the benefit of the Lender), by payment into
the account which the Borrower has designated in writing.

         

         

        
          
            
            

          

          
            30

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  Each
      Notice of Borrowing delivered to the Lender pursuant to this Section 2.02(b)
      shall be in an electronic file format acceptable to the Lender (A)
      accompanied by a copy of the Notice of Pledge (and the Receivables
      Schedule attached thereto), which was sent to the Custodian pursuant to
      the terms of the Custodial Agreement in connection with the pledge of
      Eligible Receivables to be made in connection therewith and (B) specifying
      for each Receivables pledged therein the information set forth on Exhibit
      B hereto.

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  The
      Loans shall bear interest at the Interest
Rate.

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  Subject
      to Section 2.15
      and the other terms, conditions, provisions and limitations set forth
      herein, the Borrower may borrow, repay or prepay and reborrow Loans, on
      and after the date hereof and prior to the earlier to occur of the
      Facility Maturity Date and the Program Termination
  Date.

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  Determinations
      by the Lender of the existence of any Eurodollar Disruption Event (any
      such determination to be communicated to the Borrower by written notice
      from the Lender promptly after the Lender learns of such event), or of the
      effect of any Eurodollar Disruption Event on its making or maintaining
      Loans at the Adjusted Eurodollar Rate, shall be conclusive absent manifest
      error.

                

        

         

        SECTION
2.03 Determination of Interest Periods and Interest Rates.

         

        (a) The
initial Interest Period applicable to any new Loan arising as a result of a
Borrowing shall commence on, and include, the date of such Borrowing and shall
terminate on, and include, the day immediately prior to the next occurring
Remittance Date or such earlier date as the Lender may determine (an “Early Interest Period
Termination Date”).  All outstanding Pool A Loans allocated to
one or more initial Interest Periods or Rollover Interest Periods maturing on
the same date shall be combined and allocated to a single Rollover Interest
Period at the end of such initial Interest Periods or Rollover Interest
Periods.  All outstanding Pool B Loans allocated to one or more
initial Interest Periods or Rollover Interest Periods maturing on the same date
shall be combined and allocated to a single Rollover Interest Period at the end
of such initial Interest Periods or Rollover Interest Periods.  Each
Rollover Interest Period shall commence on, and include, the Remittance Date
following the last day of the immediately preceding Interest Period (or, if
applicable, on an Early Interest Period Termination Date) and shall terminate
on, and include, the day immediately prior to the next occurring Remittance
Date.

         

        (b) The
interest rate per annum (the “Interest Rate”)
applicable to any Loan for any Interest Period shall be equal to the Adjusted
Eurodollar Rate; provided, however, that if the
Lender shall have notified the Borrower that a Eurodollar Disruption Event has
occurred, the Interest Rate for such Loan shall be equal to the Base Rate until
such Eurodollar Disruption Event has ceased, at which time the Interest Rate
shall again be equal to the Adjusted Eurodollar Rate.  Notwithstanding
the foregoing:

         

        (c) upon
the occurrence and during the continuance of any Program Termination Event, the
applicable Interest Rate for all Interest Periods in effect at the time of such
occurrence shall convert to, and for all Interest Periods that come into effect
during the continuance of any Event of Default shall be, the Default Funding
Rate;

         

        
          
            
            

          

          
            31

            
              

            

          

          
            
            

          

        

         

        (d) upon
the occurrence and during the continuance of any Pool A Termination Event, the
applicable Interest Rate for all Interest Periods with respect to all Pool A
Loans in effect at the time of such occurrence shall

         

        convert
to, and for all Interest Periods with respect to all Pool A Loans that come into
effect during the continuance of any Pool A Termination Event shall be, the
Default Funding Rate; and

         

        (e) upon
the occurrence and during the continuance of any Pool B Termination Event, the
applicable Interest Rate for all Interest Periods with respect to all Pool B
Loans in effect at the time of such occurrence shall convert to, and for all
Interest Periods with respect to all Pool B Loans that come into effect during
the continuance of any Pool B Termination Event shall be, the Default Funding
Rate.

         

        SECTION
2.04 Remittance
Procedures.  The Servicer, as agent for the Lender, shall
instruct the Lender’s Bank and, if the Servicer fails to do so, the Collateral
Agent shall instruct the Lender’s Bank, to apply funds on deposit in the
Collection Account as described in this Section 2.04.

         

        (a) Interest and Breakage
Fees.  On each Business Day (including any Remittance Date),
the Servicer shall, and, if the Servicer fails to do so, the Lender may direct
the Lender’s Bank to, retain in the Collection Account for transfer at the
further direction of the Lender or any duly authorized agent of the Lender
(whether on such day or on a subsequent day) collected funds in an amount equal
to accrued and unpaid interest through such day on the Loans not so previously
retained and the amount of any accrued and unpaid Breakage Fees owed to the
Lender on such day.  On or before the last day of each Interest
Period, the Lender shall notify the Servicer of the accrued and unpaid interest
for such Interest Period and the Servicer shall, on the last day of each
Interest Period, direct the Lender’s Bank to pay collected funds set aside in
respect of accrued and unpaid interest pursuant to this Section 2.04(a)
to the Lender (or the designee of the Lender) in respect of payment of such
accrued and unpaid interest for such Interest Period.  On any Business
Day on which an amount is set aside in respect of Breakage Fees pursuant to this
Section 2.04(a),
the Servicer shall direct the Lender’s Bank to pay such funds to the Lender in
payment of such Breakage Fees.

         

        (b) Interest Period Loan
Principal Repayment.  The Servicer shall, and if the Servicer
fails to do so the Lender may, by 10:00 a.m. (St. Paul, Minnesota time) on the
last day of each Interest Period that is not a Remittance Date, direct the
Lender’s Bank to transfer collected funds held by the Lender’s Bank in the
Collection Account on such date, to pay the Lender in payment (or partial
payment) of the outstanding principal amount of all Loans allocated to such
Interest Period, in an amount equal to the least of (i) the amount of such
collected funds held in the Collection Account other than funds set aside
pursuant to Section 2.04(a),
(ii) the aggregate outstanding principal amount of Loans allocated to such
Interest Period, (iii) if no Program Termination Event shall have occurred
and be continuing, an amount equal to the sum of (A) the excess, if any, of
the Facility Amount immediately prior to such distribution, calculated solely
with respect to Loans secured by Pool A Receivables over the Pool A
Borrowing Base and (B) the excess, if any, of the Facility Amount
immediately prior to such distribution, calculated solely with respect to Loans
secured by Pool B Receivables over the Pool B Borrowing Base (with respect
to Pool A Loans and Pool B Loans collectively, after giving effect to
any Borrowing made on such date and any distributions of amounts on deposit in
the Collection Account made on such date) or (iv) if no Program Termination
Event shall have occurred and be continuing, an amount equal to the excess, if
any, of the Facility Amount immediately prior to such distribution over the
lesser of (A) the Borrowing Base and (B) the Borrowing Limit (after
giving effect to any Borrowing made on such date and any distributions of
amounts on deposit in the Collection Account made on such date).

         

        (c) Remittance Date Transfers
From Collection Account.  The Servicer shall, and if the
Servicer fails to do so the Collateral Agent shall, by 10:00 a.m. (St. Paul,
Minnesota time) on each Remittance Date, direct the Lender’s Bank to transfer
collected funds held by the Lender’s Bank in the Collection Account which were
remitted to the Collection Account during the Collection Period with respect to
such Remittance Date (“Available Funds”), in
the following amounts and priority:

         

        
          	
                   
      

                	
                  (i)

                	
                  to
      the Borrower, in an amount equal to such funds which were paid by Obligors
      with respect to their obligation under the related Contracts to pay any
      taxes (it being agreed by the Borrower that such amount shall be promptly
      paid to the taxing authorities entitled
  thereto);

                

        

         

         

        
          
            
            

          

          
            32

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  to
      the related Qualifying Swap Counterparty under each Qualifying Interest
      Rate Swap, in an amount equal to (and for the payment of) all amounts
      which are due and payable by the Borrower to such Qualifying Swap
      Counterparty on such Remittance Date, pursuant to the terms of the
      applicable Qualifying Interest Rate Swap or this Agreement, other than any
      QSC Subordinated Termination Amounts which are due and payable by the
      Borrower pursuant to the applicable Qualifying Interest Rate
      Swap;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  on
      a pro rata basis, to (x) the Backup Servicer in an amount equal to
      the Standby Backup Servicer’s Fee (to the extent accrued and unpaid as of
      the last day of the immediately preceding Fee Period) at any time prior to
      the occurrence of a Servicer Default and the appointment of the Backup
      Servicer as the Servicer hereunder and (y) the Custodian, the
      Custodian’s Fee and (z) the Lender’s Bank, the Lender’s Bank
      Fee;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  at
      any time after the occurrence of a Servicer Default and the appointment of
      the Backup Servicer as the Servicer hereunder, to the Backup Servicer in
      an amount equal to (1) the Active Backup Servicer’s Fees which are accrued
      and unpaid as of the last day of the immediately preceding Fee Period plus
      (2) any Transition Costs not previously reimbursed to the Backup Servicer
      plus (3) the Active Backup Servicer’s Indemnified
  Amounts;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  to
      the Lender in an amount equal to (and for the pro rata payment of)
      (A) the Fees which are due and payable on such Remittance Date
      pursuant to the terms of the Fee Letter and (B) any interest on any
      Loan which is accrued and unpaid as of the last day of the immediately
      preceding Fee Period;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  at
      any time prior to the occurrence of a Servicer Default and the appointment
      of the Backup Servicer as the Servicer hereunder, to the Servicer in an
      amount equal to the Servicing Fee which is accrued and unpaid as the last
      day of the immediately preceding Fee
Period;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  to
      the Lender (for application to the repayment of Loans Outstanding) in an
      amount equal to the sum (in the following order, if the available amount
      should be insufficient to pay in full such sum), without duplication,
      of:

                

        

         

                                  
(x)           any
Borrowing Base Deficiency;

         

                   (y)           the
excess of the aggregate Facility Amount hereunder, calculated solely with
respect to Loans secured by Pool A Receivables, over the Pool A
Borrowing Base; and

         

                   (z)           the
excess of the aggregate Facility Amount hereunder, calculated solely with
respect to Loans secured by Pool B Receivables, over the Pool B
Borrowing Base;

         

        
          	
                   
      

                	
                  (viii)

                	
                  on
      a pro rata basis, (A) to the Servicer in an amount equal to any
      Servicer Advances (and amounts to be reimbursed as Servicer Advances
      pursuant to Section 6.03)
      not previously reimbursed to the Servicer and (B) to the Lender in an
      amount equal to the aggregate amount of all other Obligations then due
      from the Borrower to the Lender or any Affected Party hereunder for the
      account of such parties as applicable (other than those specified in
      clauses (ix) through (xii) below);

                

        

         

        
          	
                   
      

                	
                  (ix)

                	
                  on
      or after the occurrence of the Program Termination Date (but prior to any
      Program Termination Cure Event with respect to the Program Termination
      Event related to such Program Termination Date), to the Lender for the
      repayment of Loans Outstanding in an amount equal to the lesser of
      (A) all remaining Available Funds in the Collection Account and
      (B) an amount necessary to repay the outstanding principal amount of
      all Loans in full;

                

        

         

        
          	
                   
      

                	
                  (x)

                	
                  on
      or after the occurrence of a Pool A Termination Event, to the Lender
      for the repayment of Pool A Loans in an amount equal to the lesser of
      (A) all remaining Available Funds in the Collection Account and
      (B) an amount necessary to repay the outstanding principal amount of
      all Pool A Loans in full;

                

        

         

        
          
            
            

          

          
            33

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (xi)

                	
                  on
      or after the occurrence of a Pool B Termination Event with respect to
      any Underlying Originator, to the Lender for the repayment of Pool B
      Loans related to such Underlying Originator in an amount equal to the
      lesser of (A) all remaining Available Funds in the Collection Account
      and (B) an amount necessary to repay the outstanding principal amount
      of all Pool B Loans related to such Underlying Originator in
      full;

                

        

         

        
          	
                   
      

                	
                  (xii)

                	
                  to
      the related Qualifying Swap Counterparty under each Qualifying Interest
      Rate Swap in an amount equal to (and for the payment of) any QSC
      Subordinated Termination Payments which are due and payable by the
      Borrower to such Qualifying Swap Counterparty on such Remittance Date
      pursuant to the applicable Qualifying Interest Rate Swap;
    and

                

        

         

        
          	
                   
      

                	
                  (xiii)

                	
                  to
      the order of the Borrower, any remaining
  amounts.

                

        

         

        (d) Borrower Deficiency
Payments.  Notwithstanding anything to the contrary contained
in this Section 2.04 or
in any other provision in this Agreement, if, on any day prior to the Collection
Date, the Facility Amount shall exceed the Borrowing Limit, then the Borrower
shall remit to the Lender, prior to any Borrowing and in any event no later than
the close of business of the Lender on such day (or if such day is not a
Business Day, no later than the close of business of the Lender on the next
succeeding Business Day), a payment (to be applied by the Lender to repay Loans
selected by the Lender, in its sole discretion), in such amount as may be
necessary to reduce the Facility Amount to an amount less than or equal to the
Borrowing Limit.  Notwithstanding anything to the contrary contained
in this Section 2.04 or
in any other provision in this Agreement, if, on any day prior to the Collection
Date, the Facility Amount shall exceed the Borrowing Base, then the Borrower
shall (X) remit to the Lender, prior to any Borrowing and in any event no
later than the close of business of the Lender on such day (or if such day is
not a Business Day, no later than the close of business of the Lender on the
next succeeding Business Day), a payment (to be applied by the Lender to repay
Loans selected by the Lender, in its sole discretion), in such amount as may be
necessary to reduce the Facility Amount to an amount less than or equal to the
Borrowing Base or (Y) Pledge additional Eligible Receivables hereunder,
prior to any Borrowing and in any event no later than the close of business of
the Lender on such day (or if such day is not a Business Day, no later than the
close of business of the Lender on the next succeeding Business Day) in such
amount as may be necessary to increase the Borrowing Base to an amount equal to
or greater than the Facility Amount.

         

        (e) Pool A Deficiency
Payments.  Notwithstanding anything to the contrary contained
in this Section 2.04 or
in any other provision in this Agreement, if, on any day prior to the Collection
Date, the aggregate Facility Amount hereunder, calculated solely with respect to
Loans secured by Pool A Receivables, would exceed the Pool A Borrowing
Base, then the Borrower shall remit to the Lender, prior to any Borrowing and in
any event no later than the close of business of the Lender on such day (or if
such day is not a Business Day, no later than the close of business of the
Lender on the next succeeding Business Day), a payment (to be applied by the
Lender to repay Loans with respect to Pool A Receivables selected by the
Lender, in its sole discretion), in such amount as may be necessary to reduce
such excess to zero.

         

        (f) Pool B Deficiency
Payments.  Notwithstanding anything to the contrary contained
in this Section 2.04 or
in any other provision in this Agreement, if, on any day prior to the Collection
Date, the aggregate Facility Amount hereunder, calculated solely with respect to
Loans secured by Pool B Receivables, would exceed the Pool B Borrowing
Base, then the Borrower shall remit to the Lender, prior to any Borrowing and in
any event no later than the close of business of the Lender on such day (or if
such day is not a Business Day, no later than the close of business of the
Lender on the next succeeding Business Day), a payment (to be applied by the
Lender to repay Loans with respect to Pool B Receivables selected by the
Lender, in its sole discretion), in such amount as may be necessary to reduce
such excess to zero.

         

        (g) Instructions to the Lender’s
Bank.  All instructions and directions given to the Lender’s
Bank by the Servicer, the Borrower or the Lender pursuant to this Section 2.04
shall be in writing (including instructions and directions transmitted to the
Lender’s Bank in electronic format), and such written instructions and
directions shall be delivered with a written certification that such
instructions and directions are in compliance with the provisions of this Section 2.04.  The
Servicer and the Borrower shall immediately transmit to the Lender by telecopy a
copy of all instructions and directions given to the Lender’s Bank by such party
pursuant to this Section 2.04.  The
Lender shall immediately
transmit to the Servicer and the Borrower by telecopy a copy of all instructions
and directions given to the Lender’s Bank by the Lender, pursuant to this Section 2.04.

         

        
          
            
            

          

          
            34

            
              

            

          

          
            
            

          

        

        SECTION
2.05 Security Deposit Account.

         

        (a) On
or before the date hereof, the Borrower shall enter into a Security Deposit
Account Agreement and open and maintain a segregated trust account (the “Security Deposit
Account”) at the Lender’s Bank, for the receipt of amounts representing
any Security Deposits with respect to any Pool A Contract by the related
Obligor.  The Servicer shall promptly deposit into the Security
Deposit Account, all Security Deposits related to Pledged Pool A Receivables
which are in the possession of, or come into the possession of, the Servicer or
the Originator.  Monies received in the Security Deposit Account shall
be invested in Permitted Investments at the written direction of the Servicer or
the Lender (as determined in accordance with the Security Deposit Account
Agreement) during the term of this Agreement, and any income or other gain
realized from such investment shall be held in the Security Deposit Account,
subject to disbursement and withdrawal as herein provided.  No such
Permitted Investment shall mature later than the Business Day preceding the next
following Remittance Date and shall not be sold or disposed of prior to its
maturity.  Monies shall be subject to withdrawal in accordance with
Section 2.05(d)
hereof.

         

        (b) The
Servicer shall provide to the Borrower monthly written confirmation of
investments of funds held in the Security Deposit Account, describing the
Permitted Investments in which such amounts have been invested.  Any
funds not so invested shall be insured by the Federal Deposit Insurance
Corporation.

         

        (c) If
any amounts invested as provided in Section 2.05(a)
hereof shall be subject to disbursement from the Security Deposit Account as set
forth in Section 2.05(d)
hereof, the Servicer shall cause such investments of such Security Deposit
Account to be sold or otherwise converted to cash to the credit of such Security
Deposit Account.  The Servicer shall not be liable for any investment
loss resulting from investment of money in the Security Deposit Account in any
Permitted Investment in accordance with the terms hereof (other than in its
capacity as obligor under any Permitted Investment and other than to the extent
such loss results from the gross negligence or wilful misconduct of the
Servicer).

         

        (d) Disbursements
from the Security Deposit Account shall be made, to the extent funds therefore
are available, only as follows:

         

        
          	
                   
      

                	
                  (i)

                	
                  for
      deposit in the Collection Account in accordance with the direction of the
      Servicer prior to 2:00 p.m. New York time on the Business Day prior
      to any Remittance Date to the extent that the Servicer, in accordance with
      the terms of a Pool A Contract, has determined that amounts in respect of
      a Security Deposit shall be applied as full or partial Recoveries or, in
      its discretion, as a full or partial Scheduled Payment under such Pool A
      Contract;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      Security Deposit with respect to a Pledged Pool A Receivable shall be paid
      to or upon the order of the Servicer at any time that the Pool A Contract
      with respect to which such Security Deposit has been made is no longer a
      Pledged Pool A Receivable, whether through maturity of such Pool A
      Contract or repurchase by the Servicer, for further disposition by the
      Servicer in accordance with the terms of the related Pool A Contract or
      applicable law; and

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  any
      amounts remaining in the Security Deposit Account upon the Collection Date
      shall be distributed to or at the direction of the Servicer for further
      disposition in accordance with the terms of the related Contract or
      applicable law.

                

        

         

        SECTION
2.06 Cash Reserve
Account.

         

        (a) From
time to time after the date hereof, the Borrower may enter into one or more Cash
Reserve Account Agreements and open and maintain a segregated trust account (any
such account, a “Cash
Reserve Account”) at the Lender’s Bank, for the receipt of amounts
representing any Cash Reserves funded with respect to any Pool B Contract. The
Servicer shall promptly deposit into the Cash Reserve Account, all Cash Reserves
related to Pledged Pool B Receivables which are in the possession of, or
come into the possession of, the Servicer or the Originator.  Monies
received in any Cash Reserve Account shall be invested in Permitted Investments
at the written direction of the Servicer or the Lender (as determined in
accordance with the Cash Reserve Account Agreement) during the term of this
Agreement, and any income or other gain realized from such investment shall be
held in such Cash Reserve Account, subject to disbursement and withdrawal as
herein provided.  No such Permitted Investment shall mature later than
the Business Day preceding the next following Remittance Date and shall not be
sold or disposed of prior to its maturity.  Monies shall be subject to
withdrawal in accordance with Section 2.06(d)
hereof.

         

        
          
            
            

          

          
            35

            
              

            

          

          
            
            

          

        

         

        (b) The
Servicer shall provide to the Borrower monthly written confirmation of
investments of funds held in each Cash Reserve Account, describing the Permitted
Investments in which such amounts have been invested.  Any funds not
so invested shall be insured by the Federal Deposit Insurance
Corporation.

         

        (c) If
any amounts invested as provided in Section 2.06(a)
hereof shall be subject to disbursement from a Cash Reserve Account as set forth
in Section 2.06(d)
hereof, the Servicer shall cause such investments of such Cash Reserve Account
to be sold or otherwise converted to cash to the credit of such Cash Reserve
Account.  The Servicer shall not be liable for any investment loss
resulting from investment of money in the Cash Reserve Account in any Permitted
Investment in accordance with the terms hereof (other than in its capacity as
obligor under any Permitted Investment and other than to the extent such loss
results from the gross negligence or willful misconduct of the
Servicer).

         

        (d) Disbursements
from any Cash Reserve Account shall be made, to the extent funds therefore are
available, only as follows:

         

        
          	
                   
      

                	
                  (i)

                	
                  for
      deposit in the Collection Account in accordance with the direction of the
      Servicer prior to 2:00 p.m. New York time on the Business Day prior
      to any Remittance Date to the extent that the Servicer, in accordance with
      the terms of a Pool B Contract, has determined that amounts in respect of
      a Cash Reserve shall be applied as full or partial Recoveries or, in its
      discretion, as a full or partial Scheduled Payment under such Pool B
      Contract;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      Cash Reserve with respect to a Pool B Contract shall be paid to or
      upon the order of the Servicer at any time that the related Pool B
      Loan has been repaid in full and the Pool B Contract with respect to
      which such Cash Reserve has been made is no longer a Pledged Receivable,
      whether through maturity of such Contract or repurchase by the Servicer,
      for further disposition by the Servicer in accordance with the terms of
      the related Pool B Contract or applicable law;
  and

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  any
      amounts remaining in the Cash Reserve Account upon the Collection Date
      shall be distributed to or at the direction of the Servicer for further
      disposition in accordance with the terms of the related Pool B Contract or
      applicable law.

                

        

         

        SECTION
2.07 Payments and
Computations, Etc.  a) All amounts to be deposited or paid by
the Borrower or the Servicer to the Lender hereunder shall be paid or deposited
in accordance with the terms hereof no later than 12:00 noon (New York City
time) on the day when due in lawful money of the United States in immediately
available funds to the Collection Account or such other account as is designated
by the Lender.  The Borrower shall, to the extent permitted by law,
pay to the Lender interest on all amounts not paid or deposited when due
hereunder (whether owing by the Borrower or the Servicer) at the Base Rate, plus
2%, payable on demand; provided, however, that such
interest rate shall not at any time exceed the maximum rate permitted by
applicable law.  Such interest shall be for the account of the
Lender.  Any Obligation hereunder shall not be reduced by any
distribution of any portion of Collections with respect to any Pledged
Receivable if at any time such distribution is rescinded or returned by the
Lender to the Borrower or any other Person for any reason.  All
computations of interest and all computations of Breakage Fee and other fees
hereunder (including, without limitation, the Fees, the Active Backup Servicer’s
Fee, the Standby Backup Servicer’s Fee, the Custodian’s Fee and the Servicing
Fee) shall be made on the basis of a year of 360 days (or 365 or 366 days
for interest calculated at the Base Rate) for the actual number of days
(including the first but excluding the last day) elapsed.

         

        
          
            
            

          

          
            36

            
              

            

          

          
            
            

          

        

        (b) Whenever
any payment hereunder shall be stated to be due on a day other than a Business
Day, such payment shall be made on the next succeeding Business Day, and such
extension of time shall in such case be

         

        included
in the computation of payment of interest or any fee payable hereunder, as the
case may be; provided, however, that with
respect to the calculation of interest, such extension of time shall not be
included in more than one Interest Period.

         

        (c) If
any Borrowing requested by the Borrower and approved by the Lender pursuant to
Section 2.02 is
not for any reason whatsoever, except as a result of the gross negligence or
wilful misconduct of the Lender or an Affiliate thereof, made or effectuated, as
the case may be, on the date specified therefor, the Borrower shall indemnify
the Lender against any loss, cost or expense incurred by the Lender related
thereto (other than any such loss, cost or expense solely due to the gross
negligence or willful misconduct of the Lender or an Affiliate thereof),
including, without limitation, any loss (including cost of funds and reasonable
out-of-pocket expenses), cost or expense incurred by reason of the liquidation
or reemployment of deposits or other funds acquired by the Lender to fund Loans
or maintain Loans during such Interest Period.  The Lender shall
provide to the Borrower documentation setting forth the amounts of any loss,
cost or expense referred to in the previous sentence, such documentation to be
conclusive absent manifest error.

         

        SECTION
2.08 Fees.  a)
The Borrower shall pay the Lender certain fees (the “Fees”) in the amounts
and on the dates set forth in a fee letter (the “Fee Letter”), dated
the date hereof, among the Borrower and the Lender, as may be amended, restated,
supplemented or otherwise modified from time to time.

         

        (b) All
of the Fees payable pursuant to this Section 2.08
(other than Fees payable on the date hereof) shall be payable solely from
amounts available for application pursuant to, and subject to the priority of,
payment set forth in, Section 2.04.

         

        SECTION
2.09 Increased
Costs; Capital Adequacy.  a) If, due to either (i) the
introduction of or any change (including, without limitation, any change by way
of imposition or increase of reserve requirements) in or in the interpretation
of any law or regulation (including, without limitation, any law or regulation
resulting in any interest payments paid to a Lender under this Agreement being
subject to United States withholding tax) or (ii) the compliance with any
guideline or request from any central bank or other governmental authority
(whether or not having the force of law), there shall be any increase in the
cost to the Lender or any Affiliate, successor or assign or participant thereof
(each of which shall be an “Affected Party”) of
agreeing to make or making, funding or maintaining any Loan (or any reduction of
the amount of any payment (whether of principal, interest, fee, compensation or
otherwise) to any Affected Party hereunder), as the case may be, the Borrower
shall, from time to time, within ten days after written demand complying with
Section 2.09(c)
by the Lender, on behalf of such Affected Party, pay to the Lender, on behalf of
such Affected Party, additional amounts sufficient to compensate such Affected
Party for such increased costs or reduced payments.

         

        (b) If
either (i) the introduction of or any change in or in the interpretation of
any law, guideline, rule or regulation, directive, request or accounting
principle or (ii) the compliance by any Affected Party with any law,
guideline, rule, regulation, directive, request or accounting principle from any
central bank, other governmental authority, agency or accounting authority
(whether or not having the force of law), including, without limitation,
compliance by an Affected Party with any request or directive regarding capital
adequacy, has or would have the effect of reducing the rate of return on the
capital of any Affected Party, as a consequence of its obligations hereunder or
any related document or arising in connection herewith or therewith to a level
below that which any such Affected Party could have achieved but for such
introduction, change or compliance (taking into consideration the policies of
such Affected Party with respect to capital adequacy), by an amount deemed by
such Affected Party to be material, then, from time to time, after demand by
such Affected Party (which demand shall be accompanied by a statement setting
forth the basis of such demand), the Lender shall be paid, on behalf of such
Affected Party (from Collections with respect to Pledged Receivables pursuant
to, and subject to the priority of payment set forth in, Section 2.04),
such additional amounts as will compensate such Affected Party for such
reduction.

         

        (c) In
determining any amount provided for in this Section 2.09,
the Affected Party may use any reasonable averaging and attribution
methods.  The Lender, on behalf of any Affected Party making a claim
under this Section 2.09,
shall submit to the Borrower a certificate setting forth in reasonable detail
the basis for and the computations of such additional or increased costs, which
certificate shall be conclusive absent demonstrable error.

         

         

        
          
            
            

          

          
            37

            
              

            

          

          
            
            

          

        

        (d) If,
as a result of any event or circumstance similar to those described in Section 2.09(a)
or 2.09(b), any
Affected Party (that is a Lender) is required to compensate a bank or other
financial institution (including, without limitation, any Affiliate of Morgan
Stanley) providing liquidity support, credit enhancement or other similar
support to such Affected Party in connection with this Agreement, then, upon
demand by such Affected Party, the Borrower shall pay, in accordance with Section 2.04, to
such Affected Party such additional amount or amounts as may be necessary to
reimburse such Affected Party for any amounts paid by it, and shall notify each
Qualified Swap Counterparty of such payment.

         

        SECTION
2.10 Collateral
Assignment of Agreements.  The Borrower hereby collaterally
assigns to the Collateral Agent (and its successors and assigns) for the benefit
of the Secured Parties, all of the Borrower’s right and title to and interest
in, to and under (but not any obligations under) the Purchase and Sale
Agreement, each Qualifying Interest Rate Swap, the Contract related to each
Pledged Receivable, all other agreements, documents and instruments evidencing,
securing or guarantying any Pledged Receivable and all other agreements,
documents and instruments related to any of the foregoing (the “Assigned
Documents”).  Without limiting any obligation of the Servicer
hereunder, the Borrower confirms and agrees that the Collateral Agent (or any
designee thereof, including, without limitation, the Servicer), following an
Event of Default or a Program Termination Event, shall have the right to enforce
the Borrower’s rights and remedies under each Assigned Document, but without any
obligation on the part of the Collateral Agent or any of its Affiliates to
perform any of the obligations of the Borrower under any such Assigned
Document.  In addition, each of the Servicer and the Borrower confirms
and agrees that the Servicer and the Borrower will, upon receipt of notice or
discovery thereof, promptly send to the Collateral Agent a notice of
(i) any breach of any representation, warranty, agreement or covenant under
any such Assigned Document or (ii) any event or occurrence that, upon
notice, or upon the passage of time or both, would constitute such a breach, in
each case, immediately upon learning thereof.  The parties hereto
agree that such assignment to the Collateral Agent shall terminate upon the
Collection Date.

         

        SECTION
2.11 Grant of a
Security Interest.  To secure the prompt and complete payment
when due of the Obligations and the performance by the Borrower of all of the
covenants and obligations to be performed by it pursuant to this Agreement, the
Borrower hereby (i) collaterally assigns and pledges to the Collateral
Agent (and its successors and assigns), for the benefit of the Secured Parties,
and (ii) grants a security interest to the Collateral Agent (and its
successors and assigns), for the benefit of the Secured Parties, in all property
of the Borrower, whether tangible or intangible and whether now owned or
existing or hereafter arising or acquired and wheresoever located (collectively,
the “Pledged
Assets”), including, without limitation, all of the Borrower’s right,
title and interest in, to and under:

         

        (a) all
Pool A Receivables and Pool B Receivables purchased by (or otherwise
transferred or pledged pursuant to the terms of the Purchase and Sale Agreement)
to the Borrower under the Purchase and Sale Agreement from time to time (such
Pool A Receivables, the “Pledged Pool A
Receivables”, and such Pool B Receivables, the “Pledged Pool B
Receivables”), all Other Conveyed Property related to the Pledged
Receivables purchased by (or otherwise transferred or pledged pursuant to the
terms of the Purchase and Sale Agreement) to the Borrower under the Purchase and
Sale Agreement, all Related Security related to the Pledged Receivables, all
interest of the Borrower in all Obligor Collateral related to the Pledged
Receivables (together with all security interests in and insurance proceeds
related to such Obligor Collateral and all proceeds from the disposition of such
Obligor Collateral, whether by sale to the related Obligors or otherwise), any
Security Deposits or Cash Reserve related to such Pledged Receivables, all
Collections and other monies due and to become due under the Contracts (and, if
applicable, Underlying Contracts) related to the Pledged Receivables received on
or after the date such Pledged Receivables were purchased by (or purportedly
purchased by) the Borrower under the Purchase and Sale Agreement;

         

        (b) the
Assigned Documents, including, in each case, without limitation, all monies due
and to become due to the Borrower under or in connection therewith;

         

        (c) the
Collection Account, the Lockbox, the Lockbox Account, the Security Deposit
Account, each Cash Reserve Account and all other bank and similar accounts
relating to Collections with respect to Pledged Receivables (whether now
existing or hereafter established) and all funds held therein, and all
investments in and all income from the investment of funds in the Collection
Account, the Lockbox Account, the Security Deposit Account, each Cash Reserve
Account and such other accounts;

         

        
          
            
            

          

          
            38

            
              

            

          

          
            
            

          

        

        (d) the
Records relating to any Pledged Receivables;

         

        (e) all
UCC financing statements filed by the Borrower against the Originator under or
in connection with the Purchase and Sale Agreement;

         

        (f) [Reserved];

         

        (g) each
Qualifying Interest Rate Swap, any other interest rate protection agreement
entered into with respect to the transactions contemplated under the RLSA and,
in each case, all payments thereunder;

         

        (h) all
Liquidation Proceeds relating to any Pledged Receivables; and

         

        (i) all
proceeds of the foregoing property described in clauses (a) through (g)
above, including interest, dividends, cash, instruments and other property from
time to time received, receivable or otherwise distributed in respect of or in
exchange for or on account of the sale or other disposition of any or all of the
then existing Pledged Receivables.

         

        The
Borrower hereby authorizes the Collateral Agent to file financing statements
describing as the collateral covered thereby as "all of the debtor's personal
property or assets" or words to that effect, notwithstanding that such wording
may be broader in scope than the collateral described in this
Agreement.

         

        SECTION
2.12 Evidence of
Debt.  The Lender shall maintain an account or accounts
evidencing the indebtedness of the Borrower to the Lender resulting from each
Loan owing to the Lender from time to time, including the amounts of principal
and interest payable and paid to the Lender from time to time
hereunder.  The entries made in such account(s) of the Lender shall be
conclusive and binding for all purposes, absent manifest error.

         

        SECTION
2.13 Release of
Pledged Receivables.  a) Subject to Section 2.15
hereof, upon the repayment of any Loan, the Borrower may obtain the release of
any Pledged Receivable and the related Other Conveyed Property or Related
Security securing such Loan (including, without limitation, the release of any
security interest of the Collateral Agent or the Borrower therein) by depositing
into an account designated by the Lender the Release Price therefor on the date
of such repayment; provided, that the
foregoing release shall only be available if, after giving effect thereto and
the application of the proceeds thereof in accordance with the terms hereof,
there shall not be a Borrowing Base Deficiency, Program Termination Event,
Pool A Termination Event or a Pool B Termination Event (and such
Pool B Termination Event is related to such Pledged Receivable), or an
event that but for notice or lapse of time or both would constitute any of the
foregoing events.

         

        (b) The
Borrower shall notify the Collateral Agent of any Release Price to be paid
pursuant to this Section 2.13 on
the Business Day on which such Release Price shall be paid specifying the
Pledged Receivables to be released and the Release Price.

         

        (c) Promptly
after the Collection Date has occurred, the Collateral Agent shall re-assign and
transfer to the Borrower, for no consideration but at the sole expense of the
Borrower, their respective remaining interests in the Pledged Assets, free and
clear of any Adverse Claim resulting solely from an act by the Collateral Agent
but without any other representation or warranty, express or implied, by or
recourse against the Collateral Agent.

         

        SECTION
2.14 Treatment of
Amounts Paid by the Borrower.  Amounts paid by the Borrower
pursuant to Section 2.13 on
account of Pledged Receivables shall be treated as payments on Pledged
Receivables hereunder.

         

        SECTION
2.15 Prepayment;
Certain Indemnification Rights; Termination.  a) The Borrower
may prepay, in whole or in part, the outstanding principal amount of any Loans
advanced hereunder.  Any amounts so prepaid shall be applied to repay
the outstanding principal amount of Loans allocated to an Interest Period or
Interest Periods selected by the Lender.  Amounts prepaid pursuant to
this Section 2.15(a) may be reborrowed in accordance with the terms of this
Agreement.  If the Borrower intends to make an optional prepayment
pursuant to this Section 2.15(a), the Borrower shall give five (5) Business
Days' prior written notice thereof to the Lender, specifying the intended
Prepayment Date, the intended Prepayment Amount, whether the Loans being prepaid
are Pool A Loans or Pool B Loans, a calculation of any applicable Breakage Fee
and the Pledged Receivables that the Borrower shall
request to 

         

         

        
          
            
            

          

          
            39

            
              

            

          

          
            
            

          

        

         

        have released pursuant to Section 2.13 in connection with such
prepayment (and the Discounted Balance thereof).  Any such optional
prepayment of the outstanding principal amount of any Loans advanced hereunder
shall be accompanied by all interest accrued with respect thereto and the
Prepayment Premium with respect to the applicable Prepayment Amount and
Prepayment Date.  If such notice is given, the principal amount
specified in such notice (together with all interest accrued with respect
thereto and the Prepayment Premium related thereto) shall be due and payable on
the Prepayment Date specified therein.  Notwithstanding the foregoing,
any payment by the Borrower required pursuant to Section 2.04(c)(vii), Section
2.04(d),(e) or (f) or, in connection with the occurrence of an Event of Default,
pursuant to Section 7.01 hereof shall not be considered an optional prepayment
and no Prepayment Premium shall be required to be paid in respect thereof.

         

        (b) Without
limiting any other provision hereof, the Borrower agrees to indemnify the
Lender, the Qualifying Swap Counterparty and any Affiliate thereof and to hold
each such Person harmless from any cost, loss or expense which it may sustain or
incur as a consequence of (i) the Borrower making any optional prepayment
pursuant to Section 2.15(a) hereof, (ii) any default by the Borrower in making
any optional prepayment pursuant to Section 2.15(a) hereof after notice of such
prepayment has been given, (iii) any failure by the Borrower to take a Loan
hereunder after notice of such Loan has been given pursuant to this Agreement,
(iv) any acceleration of the maturity of any Loans by the Lender in accordance
with the terms of this Agreement, including, but not limited to, any Breakage
Fees, any cost, loss or expense arising related to the termination (in whole or
in part) or amendment of any Qualifying Interest Rate Swap and from interest or
fees payable by the Lender to lenders of funds obtained by it in order to
advance or maintain the Loans hereunder.  Indemnification pursuant to
this Section shall survive the termination of this Agreement and shall include
reasonable fees and expenses of counsel and expenses of litigation.

         

        (c) Notwithstanding
any other provision hereof, the Borrower shall not terminate or amend this
Agreement or any other Transaction Document or reduce the Borrowing Limit prior
to the Facility Maturity Date without the Lender’s prior written consent, which
consent may be withheld in the Lender’s sole discretion.

         

        SECTION
2.16 Increase of
Borrowing Limit.  The Borrower may, upon 30 days’ prior
written notice to the Lender (with a simultaneous copy to the Initial Qualifying
Swap Counterparty), request that the Borrowing Limit be increased, which request
may be granted in the sole discretion, and with the written consent, of the
Lender, it being agreed that the Borrower shall pay to the Lender the fee
related to such increase that is required pursuant to the terms of the Fee
Letter.

         

        
          	
                   
      

                	
                  ARTICLE
      III.

                

        

         

        
          	
                   
      

                	
                  CONDITIONS
      OF LOANS

                

        

         

        SECTION
3.01 Conditions
Precedent to Initial Borrowing.  The initial Borrowing
hereunder is subject to the conditions precedent that:

         

        (a) the
Arrangement Fee (as such term is defined in the Fee Letter) shall have been paid
in full and all other acts and conditions (including, without limitation, the
obtaining of any necessary regulatory approvals and the making of any required
filings, recordings or registrations) required to be done and performed and to
have happened prior to the execution, delivery and performance of this Agreement
and all related documents and to constitute the same legal, valid and binding
obligations, enforceable in accordance with their respective terms, shall have
been done and performed and shall have happened in due and strict compliance
with all applicable laws; and

         

        (b) the
Lender shall have received on or before the date of such Borrowing the items
listed in Schedule I
hereto, each in form and substance satisfactory to the Lender.

         

        SECTION
3.02 Conditions
Precedent to All Borrowings.  Each Borrowing (including the
initial Borrowing, except as explicitly set forth below) by the Borrower from
the Lender shall be subject to the further conditions precedent
that:

         

        
          
            
            

          

          
            40

            
              

            

          

          
            
            

          

        

          (a)  With
respect to any such Borrowing (other than the initial Borrowing), on or prior to
the date of such Borrowing, the Servicer shall have delivered to the Lender, in
form and substance satisfactory to the Lender, the most recent Monthly
Remittance Report required by the terms of Section 6.10(b);

         

          (b) After giving
effect to such Borrowing requested by the Borrower the following statements
shall be true (and the Borrower shall be deemed to have certified
that):

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      Facility Amount will not exceed the lesser of the (x) Borrowing Limit
      and (y) the Borrowing Base;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      Facility Amount, calculated solely with respect to Loans secured by
      Pool A Receivables, will not exceed the Pool A Borrowing Base;
      and

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      Facility Amount, calculated solely with respect to Loans secured by
      Pool B Receivables, will not exceed the Pool B Borrowing
      Base;

                

        

         

        (c) On
the Borrowing Date of such Borrowing, the following statements shall be true and
correct, and the Borrower by accepting any amount of such Borrowing shall be
deemed to have represented that:

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      representations and warranties contained in Section 4.01
      are true and correct in all material respects, before and after giving
      effect to the Borrowing to take place on such Borrowing Date and to the
      application of proceeds therefrom, on and as of such day as though made on
      and as of such date;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  no
      event has occurred and is continuing, or would result from such Borrowing,
      which constitutes a Program Termination Event hereunder or an event that
      but for notice or lapse of time or both would constitute a Program
      Termination Event;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  with
      respect to any Borrowing of a Pool A Loan, no event has occurred and
      is continuing, or would result from such Borrowing, which constitutes a
      Pool A Termination Event hereunder or an event that but for notice or
      lapse of time or both would constitute a Pool A Termination
      Event;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  with
      respect to any Borrowing of a Pool B Loan, no event has occurred and
      is continuing, or would result from such Borrowing, which constitutes a
      Pool B Termination Event with respect to the Underlying Originator
      related to the Pool B Receivable securing such Pool B Loan or an
      event that but for notice or lapse of time or both would constitute such a
      Pool B Termination Event;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  (A)

                	
                  the
      principal amount of such Loan being advanced on such Borrowing Date is not
      less than $500,000, (b) on and as of such Borrowing Date, after
      giving effect to such Borrowing, the Facility Amount does not exceed the
      lesser of (A) the Borrowing Limit and (B) the Borrowing Base,
      (c) on and as of such Borrowing Date, after giving effect to such
      Borrowing, the aggregate Facility Amount hereunder, calculated solely with
      respect to Loans secured by Pool A Receivables, does not exceed the
      Pool A Borrowing Base, and (d) on and as of such Borrowing Date,
      after giving effect to such Borrowing, the aggregate Facility Amount
      hereunder, calculated solely with respect to Loans secured by Pool B
      Receivables, does not exceed the Pool B Borrowing
    Base;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  (A)

                	
                  the
      Borrower has delivered to the Lender a copy of the Notice of Borrowing and
      the related Notice of Pledge (together with the attached Receivables
      Schedule) pursuant to Section 2.02,
      each appropriately completed and executed by the Borrower, (B) the
      Borrower has delivered or caused to have been delivered to the Custodian
      the Notice of Pledge and each item listed in the definition of Receivable
      File with respect to the Receivables being Pledged hereunder three (3) or,
      in the case of the initial Borrowing Date hereunder, four (4) Business
      Days prior to such Borrowing Date, (C) the Contract related to each
      Receivable being Pledged hereunder on such Borrowing Date has been duly
      assigned by the Originator to the Borrower and duly
    assigned

                

        

         

        
          
            
            

          

          
            41

            
              

            

          

          
            
            

          

        

        
          	
                   
      

                	
                  by
      the Borrower to the Collateral Agent and (D) by 2:00 P.M. (New
      York City time) on the Business Day immediately preceding such Borrowing
      Date, a Collateral Receipt from the Custodian confirming that, inter alia, the
      Receivable Files received on or before such Business Day conform with the
      Receivables Schedule delivered to the Custodian and the Lender pursuant to
      Section 2.02;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  all
      terms and conditions of the Purchase and Sale Agreement required to be
      satisfied in connection with the assignment of each Receivable being
      Pledged hereunder on such Borrowing Date (and the Other Conveyed Property
      and Related Security related thereto), including, without limitation, the
      perfection of the Borrower’s interests therein (other than with respect to
      Equipment which has a value of less than $25,000 and is leased under
      Dollar Purchase Option Contracts or $50,000 and is leased under FMV
      Contracts), shall have been satisfied in full, and all filings (including,
      without limitation, UCC filings) required to be made by any Person and all
      actions required to be taken or performed by any Person in any
      jurisdiction to give the Collateral Agent a first priority perfected
      security interest in such Receivables, Related Security and the Other
      Conveyed Property related thereto and the proceeds thereof shall have been
      made, taken or performed;

                

        

         

        
          	
                   
      

                	
                  (viii)

                	
                  (A)

                	
                  the
      initial Servicer shall have taken or caused to be taken all steps
      necessary under all applicable law (including the filing of an Obligor
      Financing Statement) in order to cause a valid, subsisting and enforceable
      perfected, first priority security interest to exist in Originator’s favor
      in the Obligor Collateral securing each Receivable being Pledged hereunder
      on such Borrowing Date (other than with respect to Equipment which has a
      value of less than $25,000 and is leased under Dollar Purchase Option
      Contracts or $50,000 and is leased under FMV Contracts), (B) the
      Originator shall have assigned the perfected, first priority security
      interest in the Obligor Collateral to the Borrower pursuant to the
      Purchase and Sale Agreement and (C) the Borrower shall have assigned the
      perfected, first priority security interest in the Obligor Collateral (and
      the proceeds thereof) referred to in clause (A) above to the
      Collateral Agent, pursuant to Section 2.11
      hereof;

                

        

         

        
          	
                   
      

                	
                  (ix)

                	
                  if
      the Obligor Collateral related to any Receivable securing such Borrowing
      is a Vehicle, the Borrower shall have delivered to the applicable
      Registrar of Titles an application for a Certificate of Title for such
      Vehicle satisfying the Titling Requirements;
and

                

        

         

        
          	
                   
      

                	
                  (x)

                	
                  the
      Borrower shall have taken all steps necessary under all applicable law in
      order to cause to exist in favor of the Collateral Agent a valid,
      subsisting and enforceable first priority perfected security interest in
      the Borrower’s interest in the Obligor Collateral related to each
      Receivable being Pledged hereunder on such Borrowing Date (other than with
      respect to Underlying Equipment which has a value of less than $25,000 and
      is leased under Dollar Purchase Option Contracts or $50,000 and is leased
      under FMV Contracts);

                

        

         

        (d) No
law or regulation shall prohibit, and no order, judgment or decree of any
federal, state or local court or governmental body, agency or instrumentality
shall prohibit or enjoin, the making of such Loans by the Lender in accordance
with the provisions hereof; and

         

        (e) The
Lender shall have received and found to be satisfactory with respect to Pledged
Receivables being Pledged in connection with such Borrowing, which have been
previously pledged to any lender by the Originator, the Borrower or any
Affiliate thereof under any other financing facility, evidence of the release of
any liens granted in connection with such financing with respect to any such
Pledged Receivables.

         

        (f) Unless
a credit agreement and/or security agreement, including but not limited to any
such agreement with National City Bank, as agent, related to Receivables being
Pledged by the Borrower in connection with such Borrowing, shall have provided
for an automatic release of the Agent’s or Collateral Agent’s, as applicable,
lien and security interest in such Receivables granted thereunder, the
applicable agent or lender shall have executed and delivered to the Borrower and
the Collateral Agent a partial release letter and the Borrower shall have duly
filed with the appropriate filing office a UCC-3 partial release evidencing the
release contained in such release letter, in each case in a form satisfactory to
the Collateral Agent.

         

        
          
            
            

          

          
            42

            
              

            

          

          
            
            
       SECTION
3.03  Advances Do Not Constitute a
Waiver.  No advance of a Loan hereunder shall constitute a
waiver of any condition to the Lender’s obligation to make such an advance
unless such waiver is in writing and executed by the Lender.

        

         

        
          	
                   
      

                	
                  ARTICLE
      IV.

                

        

         

        
          	
                   
      

                	
                  REPRESENTATIONS
      AND WARRANTIES

                

        

         

        SECTION
4.01 Representations and
Warranties of the Borrower.  The Borrower hereby represents and
warrants, as of the date hereof, on each Borrowing Date and on the first day of
each Rollover Interest Period, as follows:

         

        (a) Each
Receivable designated as an Eligible Receivable on any Borrowing Base
Certificate or Monthly Remittance Report is an Eligible
Receivable.  Each Receivable included as an Eligible Receivable in any
calculation of the Borrowing Base or the Eligible Receivables Balance is an
Eligible Receivable.

         

        (b) The
Borrower is a limited liability company duly organized, validly existing and in
good standing under the laws of the jurisdiction of its formation and has the
power and all licenses necessary to own its assets and to transact the business
in which it is engaged and is duly qualified and in good standing under the laws
of each jurisdiction where the transaction of such business or its ownership of
the Pledged Receivables requires such qualification.

         

        (c) The
Borrower has the power, authority and legal right to make, deliver and perform
this Agreement and each of the Transaction Documents to which it is a party and
all of the transactions contemplated hereby and thereby, and has taken all
necessary action to authorize the execution, delivery and performance of this
Agreement and each of the Transaction Documents to which it is a party, and to
grant to the Collateral Agent a first priority perfected security interest in
the Pledged Assets on the terms and conditions of this
Agreement.  This Agreement and each of the Transaction Documents to
which the Borrower is a party constitutes the legal, valid and binding
obligation of the Borrower, enforceable against it in accordance with their
respective terms, except as the enforceability hereof and thereof may be limited
by bankruptcy, insolvency, moratorium, reorganization and other similar laws of
general application affecting creditors’ rights generally and by general
principles of equity (whether such enforceability is considered in a proceeding
in equity or at law).  No consent of any other party and no consent,
license, approval or authorization of, or registration or declaration with, any
governmental authority, bureau or agency is required in connection with the
execution, delivery or performance by the Borrower of this Agreement or any
Transaction Document to which it is a party or the validity or enforceability of
this Agreement or any such Transaction Document or the Pledged Receivables,
other than such as have been met or obtained.

         

        (d) The
execution, delivery and performance of this Agreement and all other agreements
and instruments executed and delivered or to be executed and delivered pursuant
hereto or thereto in connection with the Pledge of the Pledged Assets will not
(i) create any Adverse Claim on the Pledged Assets or (ii) violate any
provision of any existing law or regulation or any order or decree of any court,
regulatory body or administrative agency or the certificate of formation or
limited liability company agreement of the Borrower or any contract or other
agreement to which or the Borrower is a party or by which the Borrower or any
property or assets of the Borrower may be bound.

         

        (e) No
litigation or administrative proceeding of or before any court, tribunal or
governmental body is presently pending or, to the knowledge of the Borrower,
threatened against the Borrower or any properties of Borrower or with respect to
this Agreement, which, if adversely determined, could have a Material Adverse
Effect.

         

        (f) In
selecting the Receivables to be Pledged pursuant to this Agreement, no selection
procedures were employed which are intended to be adverse to the interests of
the Lender.

         

        
          
            
            

          

          
            43

            
              

            

          

          
            
            

          

        

        (g) The
grant of the security interest in the Pledged Assets by the Borrower to the
Collateral Agent pursuant to this Agreement, is in the ordinary course of
business for the Borrower and is not subject to the bulk transfer or any similar
statutory provisions in effect in any applicable jurisdiction.  No
such Pledged Assets have been
sold, transferred, assigned or pledged by the Borrower to any Person, other than
the Pledge of such Assets to the Collateral Agent pursuant to the terms of this
Agreement.

         

        (h) The
Borrower has no Debt or other indebtedness which, in the aggregate, exceeds
$10,000, other than Debt incurred under the terms of the Transaction
Documents.

         

        (i) The
Borrower has been formed solely for the purpose of engaging in the transactions
contemplated by this Agreement and the other Transaction Documents.

         

        (j) No
injunction, writ, restraining order or other order of any nature adversely
affects the Borrower’s performance of its obligations under this Agreement or
any Transaction Document to which the Borrower is a party.

         

        (k) The
Borrower has filed (on a consolidated basis or otherwise) on a timely basis all
tax returns (including, without limitation, all foreign, federal, state, local
and other tax returns) required to be filed, is not liable for taxes payable by
any other Person and has paid or made adequate provisions for the payment of all
taxes, assessments and other governmental charges due from the Borrower except
for those taxes being contested in good faith by appropriate proceedings and in
respect of which no penalty may be assessed from such contest and it has
established proper reserves on its books.  No tax lien or similar
adverse claim has been filed, and no claim is being asserted, with respect to
any such tax, assessment or other governmental charge.  Any taxes,
fees and other governmental charges payable by the Borrower, as applicable, in
connection with the execution and delivery of this Agreement and the other
Transaction Documents and the transactions contemplated hereby or thereby have
been paid or shall have been paid if and when due.

         

        (l) The
chief executive office of the Borrower (is located at 110 Poplar Street,
Suite 101, Wilmington, DE 19801 and the location of the Borrower’s
records regarding the Pledged Receivables (other than those delivered to the
Custodian)) is located at
1818at One Commerce
Square, 2005 Market Street, 915th Floor,
Philadelphia, PA 19103.

         

        (m) The
Borrower’s legal name is as set forth in this Agreement; other than as disclosed
on Schedule II
hereto (as such schedule may be updated from time to by the Lender upon receipt
of a notice delivered to the Lender pursuant to Section 6.18),
the Borrower has not changed its name since its formation; the Borrower does not
have tradenames, fictitious names, assumed names or “doing business as” names
other than as disclosed on Schedule II
hereto (as such schedule may be updated from time to by the Lender upon receipt
of a notice delivered to the Lender pursuant to Section 6.18).

         

        (n) The
Borrower is solvent and will not become insolvent after giving effect to the
transactions contemplated hereby; the Borrower is paying its debts as they
become due; and the Borrower, after giving effect to the transactions
contemplated hereby, will have adequate capital to conduct its
business.

         

        (o) The
Borrower has no subsidiaries.

         

        (p) The
Borrower has given fair consideration and reasonably equivalent value in
exchange for the sale of the Pledged Receivables by the Originator under the
Purchase and Sale Agreement.

         

        (q) No
Monthly Remittance Report or Borrowing Base Certificate (each if prepared by the
Borrower or to the extent that information contained therein is supplied by the
Borrower), information, exhibit, financial statement, document, book, record or
report furnished or to be furnished by the Borrower to the Lender in connection
with this Agreement is or will be inaccurate in any material respect as of the
date it is or shall be dated or (except as otherwise disclosed in writing to the
Lender, as the case may be, at such time) as of the date so furnished, and no
such document contains or will contain any material misstatement of fact or
omits or shall omit to state a material fact or any fact necessary to make the
statements contained therein not misleading.

         

        
          
            
            

          

          
            44

            
              

            

          

          
            
            

          

        

        (r) No
proceeds of any Loans will be used by the Borrower to acquire any security in
any transaction, which is subject to Section 13 or 14 of the Securities
Exchange Act of 1934, as amended.

         

        (s) There
are no agreements in effect adversely affecting the rights of the Borrower to
make, or cause to be made, the grant of the security interest in the Pledged
Assets contemplated by Section 2.10.

         

        (t) The
Borrower is not an “investment company” or an “affiliated person” of or
“promoter” or “principal underwriter” for an “investment company” as such terms
are defined in the Investment Company Act of 1940, as amended, nor is the
Borrower otherwise subject to regulation thereunder.

         

        (u) No
Event of Default or Unmatured Event of Default has occurred and is
continuing.

         

        (v) Each
of the Pledged Receivables was underwritten and is being serviced in conformance
with Originator’s standard underwriting, credit, collection, operating and
reporting procedures and systems (including, without limitation, the Credit and
Collection Policy).

         

        (w) The
Borrower is in compliance with ERISA in all material respects. No steps have
been taken to terminate any Borrower Pension Plan which could result in material
liability, and no contribution failure has occurred with respect to any Borrower
Pension Plan sufficient to give rise to a lien under section 302(f) of
ERISA.  No condition exists or event or transaction has occurred with
respect to any Borrower Pension Plan which could result in the Borrower or any
ERISA Affiliate of Borrower incurring any material liability, fine or
penalty.

         

        (x) There
is not now, nor will there be at any time in the future, any agreement or
understanding between the Servicer and the Borrower (other than as expressly set
forth herein), providing for the allocation or sharing of obligations to make
payments or otherwise in respect of any taxes, fees, assessments or other
governmental charges.

         

        (y)  Notwithstanding anything to the contrary in
the Netbank Facility, no Pledged Receivable constitutes (for purposes of the
Netbank Facility) an “Eligible Receivable” as defined under the Netbank
Facility.

         

        SECTION
4.02 Representations and
Warranties of the Servicer.  The Servicer (so long as the
Servicer is not the Backup Servicer as successor Servicer) hereby represents and
warrants, as of the date hereof, on each Borrowing Date, on each Remittance Date
and on the first day of each Rollover Interest Period, as follows:

         

        (a) Each
Receivable designated as an Eligible Receivable on any Borrowing Base
Certificate or Monthly Remittance Report is an Eligible
Receivable.  Each Receivable included as an Eligible Receivable in any
calculation of the Borrowing Base or the Eligible Receivables Balance is an
Eligible Receivable.

         

        (b) The
Servicer is a corporation duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation and has the power and
all licenses necessary to own its assets and to transact the business in which
it is engaged (which includes servicing Receivables on behalf of third parties
and itself) and is duly qualified and in good standing under the laws of each
jurisdiction where its servicing of the Pledged Receivables requires such
qualification.

         

        (c) The
Servicer has the power, authority and legal right to make, deliver and perform
this Agreement and each of the Transaction Documents to which it is a party and
all of the transactions contemplated hereby and thereby, and has taken all
necessary action to authorize the execution, delivery and performance of this
Agreement and each of the Transaction Documents to which it is a
party.  This Agreement and each of the Transaction Documents to which
the Servicer is a party constitutes the legal, valid and binding obligation of
the Servicer, enforceable against it in accordance with their respective terms,
except as the enforceability hereof and thereof may be limited by bankruptcy,
insolvency, moratorium, reorganization and other similar laws of general
application affecting creditors’ rights generally and by general principles of
equity (whether such enforceability is considered in a proceeding in equity or
at law).  No consent of any other party and no consent, license,
approval or authorization of, or registration or declaration with, any
governmental authority, bureau or agency is required in connection with the
execution, delivery or performance by the Servicer of this Agreement or any
Transaction Document to which it is a party or the validity or enforceability of
this Agreement or any such Transaction Document, other than such as have been
met or obtained.

         

        
          
            
            

          

          
            45

            
              

            

          

          
            
            

          

        

        (d) The
execution, delivery and performance of this Agreement by the Servicer and all
other agreements and instruments executed and delivered or to be executed and
delivered by the Servicer pursuant hereto or thereto in connection with the
Pledge of the Pledged Assets will not (i) create any Adverse Claim on the
Pledged Assets or (ii) violate any provision of any existing law or
regulation or any order or decree of any court, regulatory body or
administrative agency or the certificate of incorporation or bylaws of the
Servicer or any material contract or other agreement to which the Servicer is a
party or by which the Servicer or any of its property or assets may be
bound.

         

        (e) No
litigation or administrative proceeding of or before any court, tribunal or
governmental body is presently pending or, to the knowledge of the Servicer,
threatened against the Servicer or any properties of the Servicer or with
respect to this Agreement, which, if adversely determined, could have a Material
Adverse Effect.

         

        (f) No
injunction, writ, restraining order or other order of any nature adversely
affects the Servicer’s performance of its obligations under this Agreement or
any Transaction Document to which the Servicer is a party.

         

        (g) The
Servicer has filed (on a consolidated basis or otherwise) on a timely basis all
tax returns (including, without limitation, all foreign, federal, state, local
and other tax returns) required to be filed, is not liable for taxes payable by
any other Person and has paid or made adequate provisions for the payment of all
taxes, assessments and other governmental charges due from the Servicer except
for those taxes being contested in good faith by appropriate proceedings and in
respect of which it has established proper reserves on its books.  No
tax lien or similar adverse claim has been filed, and no claim is being
asserted, with respect to any such tax, assessment or other governmental
charge.  Any taxes, fees and other governmental charges payable by the
Servicer in connection with the execution and delivery of this Agreement and the
other Transaction Documents to which it is a party and the transactions
contemplated hereby or thereby have been paid or shall have been paid if and
when due.

         

        (h) The
chief executive office of the Servicer (and the location of the Servicer’s
records regarding the Pledged Receivables (other than those delivered to the
Custodian)) is located at 1818One Commerce Square, 2005
Market Street, 915th Floor,
Philadelphia, PA 19103.

         

        (i) The
Servicer’s legal name is as set forth in this Agreement; other than as disclosed
on Schedule II
hereto (as such schedule may be updated from time to by the Lender upon receipt
of a notice delivered to the Lender pursuant to Section 6.18),
the Servicer has not changed its name since its formation; the Servicer does not
have tradenames, fictitious names, assumed names or “doing business as” names
other than as disclosed on Schedule II
hereto (as such schedule may be updated from time to by the Lender upon receipt
of a notice delivered to the Lender pursuant to Section 6.18).

         

        (j) The
Servicer is solvent and will not become insolvent after giving effect to the
transactions contemplated hereby; the Servicer is paying its debts as they
become due; and the Servicer, after giving effect to the transactions
contemplated hereby, will have adequate capital to conduct its
business.

         

        (k) As
of the date hereof and as of the date of delivery of any Monthly Remittance
Report or Borrowing Base Certificate, no Monthly Remittance Report or Borrowing
Base Certificate (each if prepared by the Servicer or to the extent that
information contained therein is supplied by the Servicer), information,
exhibit, financial statement, document, book, record or report furnished or to
be furnished by the Servicer to the Lender in connection with this Agreement is
or will be inaccurate in any material respect, and no such document contains or
will contain any material misstatement of fact or omits or shall omit to state a
material fact or any fact necessary to make the statements contained therein not
misleading.

         

        (l) The
Servicer is not an “investment company” or an “affiliated person” of or
“promoter” or “principal underwriter” for an “investment company” as such terms
are defined in the Investment Company Act of 1940, as amended, nor is the
Servicer otherwise subject to regulation thereunder.

         

        (m) No
Event of Default or Unmatured Event of Default has occurred and is
continuing.

         

        
          
            
            

          

          
            46

            
              

            

          

          
            
            

          

        

        (n) Each
of the Pledged Receivables was underwritten and is being serviced in conformance
with Originator’s and the Servicer’s standard underwriting, credit, collection,
operating and reporting procedures and systems (including, without limitation,
the Credit and Collection Policy).

         

        (o) Any
Computer Tape or Listing made available by the Servicer to the Lender was
complete and accurate in all material respects as of the date on which such
Computer Tape or Listing was made available.

         

        (p) The
Servicer is in compliance with ERISA in all material respects. No steps have
been taken to terminate any Servicer Pension Plan which could result in material
liability, and no contribution failure has occurred with respect to any Servicer
Pension Plan sufficient to give rise to a lien under section 302(f) of
ERISA.  No condition exists or event or transaction has occurred with
respect to any Servicer Pension Plan which could result in the Servicer or any
ERISA Affiliate of Servicer incurring any material liability, fine or
penalty.

         

        (q) There
is not now, nor will there be at any time in the future, any agreement or
understanding between the Servicer and the Borrower (other than as expressly set
forth herein), providing for the allocation or sharing of obligations to make
payments or otherwise in respect of any taxes, fees, assessments or other
governmental charges.

         

        (r)  Notwithstanding anything to the contrary in
the Netbank Facility, no Pledged Receivable constitutes (for purposes of the
Netbank Facility) an “Eligible Receivable” as defined under the Netbank
Facility.

         

        SECTION
4.03 Resale of
Receivables Upon Breach of Covenant or Representation and Warranty by
Borrower.  The Borrower or the Servicer, as the case may be,
shall inform the other parties to this Agreement and the Qualifying Swap
Counterparty promptly, in writing, upon the discovery of any breach of the
representations, warranties and/or covenants contained in Section 4.01,
Section 4.02 or
Section 5.01;
provided, however, that the
failure to provide any such notice shall not diminish, in any manner whatsoever,
any obligation of the Borrower under this Section 4.03 to
sell any Pledged Receivable.  Upon the discovery by or notice to the
Borrower of any such breach that also constitutes a LEAF Purchase Event under
and as defined in the Purchase and Sale Agreement, the Borrower shall have an
obligation to, and the Borrower shall, resell to the Originator pursuant to the
Purchase and Sale Agreement (and the Collateral Agent may enforce such
obligation of the Borrower to sell) any Pledged Receivable adversely affected by
any such breach.  The Servicer shall notify the Collateral Agent
promptly, in writing, of any failure by the Borrower to so resell any such
Pledged Receivable.  In connection with the resale of such Pledged
Receivable, the Borrower shall remit funds in an amount equal to the Release
Price for such Pledged Receivable to the Collection Account on the date of such
resale. It is understood and agreed that the obligation of the Borrower to
resell to the Originator, and the obligation of the Originator to purchase, any
Receivables which are adversely effected by a LEAF Purchase Event is not
intended to, and shall not, constitute a guaranty of the collectibility or
payment of any Receivable which is not collected, not paid or uncollectible on
account of the insolvency, bankruptcy, or financial inability to pay of the
related Obligor.

         

        SECTION
4.04 Representations and
Warranties of the Lender.  The Lender hereby represents and
warrants, as of the date hereof, on each Borrowing Date and on the first day of
each Rollover Interest Period, that it is a “qualified purchaser” within the
meaning of Section 3(c)(7) of the Investment Company Act.

         

        
          	
                   
      

                	
                  ARTICLE
      V.

                

        

         

        

         

        
          	
                   
      

                	
                  GENERAL
      COVENANTS OF THE BORROWER AND THE
SERVICER

                

        

         

        SECTION
5.01 General
Covenants.  vii) The Borrower will observe all corporate
procedures required by its certificate of formation, limited liability company
agreement and the laws of its jurisdiction of formation.  The Borrower
will maintain its limited liability company existence in good standing under the
laws of its jurisdiction of formation and will promptly obtain and thereafter
maintain qualifications to do business as a foreign limited liability company in
any other state in which it does business and in which it is required to so
qualify under applicable law.

         

         

        
          
            
            

          

          
            47

            
              

            

          

          
            
            

          

        

        
          (b) The
Borrower will at all times ensure that (i) its members act independently
and in its interests and in the interests of its creditors, (ii) it shall
at all times maintain at least one independent manager who (A) is not
currently and has not been during the five years preceding the date of
this Agreement an officer, director or employee of the Borrower or an Affiliate
thereof (other than acting as independent manager or in a similar capacity) and
(B) is not a member of the Borrower or an Affiliate thereof (other than a
special independent member of the Borrower or a limited purpose corporation,
business trust, partnership or other entity organized for the purpose of
acquiring, financing or otherwise investing, directly or indirectly, in assets
or receivables originated, owned or serviced by Originator or an Affiliate of
any of them), (iii) its assets are not commingled with those of Originator
or any other Affiliate of the Borrower, (iv) its members duly authorize all
of its limited liability company actions, (v) it maintains separate and
accurate records and books of account and such books and records are kept
separate from those of Originator and any other Affiliate of the Borrower and
(vi) it maintains minutes of the meetings and other proceedings of the
members.  Where necessary, the Borrower will obtain proper
authorization from its members for limited liability company action.

        

         

        (c) The
Borrower will pay its operating expenses and liabilities from its own
assets.

         

        (d) The
Borrower will not have any of its indebtedness guaranteed by Originator or any
Affiliate thereof.  Furthermore, the Borrower will not hold itself
out, or permit itself to be held out, as having agreed to pay or as being liable
for the debts of Originator, and the Borrower will not engage in business
transactions with Originator, except on an arm’s-length basis.  The
Borrower will not hold Originator out to third parties as other than an entity
with assets and liabilities distinct from the Borrower.  The Borrower
will cause any of its financial statements consolidated with those of Originator
to state that the Borrower is a separate corporate entity with its own separate
creditors who, in any liquidation of the Borrower, will be entitled to be
satisfied out of the Borrower’s assets prior to any value in the Borrower
becoming available to the Borrower’s equity holders.  The Borrower
will not act in any other matter that could foreseeably mislead others with
respect to the Borrower’s separate identity.

         

        (e) In
its capacity as Servicer, LEAF Financial will, to the extent necessary, maintain
separate records on behalf of and for the benefit of the Lender, act in
accordance with instructions and directions, delivered in accordance with the
terms hereof, from the Borrower, and/or the Lender in connection with its
servicing of the Pledged Receivables hereunder, and will ensure that, at all
times when it is dealing with or in connection with the Pledged Receivables in
its capacity as Servicer, it holds itself out as Servicer, and not in any other
capacity.

         

        (f) The
Servicer (if LEAF Financial or an Affiliate thereof) shall, to the extent
required by applicable law, disclose all material transactions associated with
this transaction in appropriate regulatory filings and public
announcements.  The annual financial statements of Resource America
(including any consolidated financial statements) shall disclose the effects of
the transactions contemplated by the Purchase and Sale Agreement as a sale of
Receivables, Related Security and Other Conveyed Property to the Borrower, and
the annual financial statements of the Borrower shall disclose the effects of
the transactions contemplated by this Agreement as a loan to the extent required
by and in accordance with GAAP, it being understood that the Loans to the
Borrower under this Agreement will be treated as debt on the consolidated
financial statements of Resource America.

         

        (g) The
Borrower shall take all other actions necessary to maintain the accuracy of the
factual assumptions set forth in the legal opinions of Thacher Proffitt &
Wood LLP, as special counsel to the Originator and the Borrower, issued in
connection with the Purchase and Sale Agreement and relating to the issues of
substantive consolidation and true conveyance of the Pledged
Receivables.

         

        (h) Except
as otherwise provided herein or in any other Transaction Document, neither the
Borrower nor the Servicer shall sell, assign (by operation of law or otherwise)
or otherwise dispose of, or create or (if the Servicer is LEAF Financial or an
Affiliate thereof) suffer to exist any Adverse Claim upon or with respect to,
any Pledged Receivable, any Collections related thereto or any other Pledged
Assets related thereto, or upon or with respect to any account to which any
Collections of any Receivable are sent, or assign any right to receive income in
respect thereof.  Except as otherwise provided herein or in any other
Transaction Document, the Borrower shall not create or suffer to exist any
Adverse Claim upon or with respect to any of the Borrower’s
assets.  Except as otherwise provided herein or in any other
Transaction Document, the Servicer shall not create, or (if the Servicer is LEAF
Financial or an Affiliate thereof) permit any action to be taken by any Person
to create, any Adverse Claim upon or with respect to any of the Borrower’s
assets.

         

        
          
            
            

          

          
            48

            
              

            

          

          
            
            

          

        

        (i) The
Borrower will not merge or consolidate with, or convey, transfer, lease or
otherwise dispose of (whether in one transaction or in a series of
transactions), all or substantially all of its assets (whether now owned or
hereafter acquired) other than with respect to asset dispositions in connection
with an optional prepayment pursuant to Section 2.15(a) hereof, or acquire all
or substantially all of the assets or capital stock or other ownership interest
of any Person without the prior written consent of the Lender.

         

        (j) The
Borrower will not account for or treat (whether in financial statements or
otherwise) the transactions contemplated by the Purchase and Sale Agreement in
any manner other than a sale and absolute assignment of Receivables, Related
Security and Other Conveyed Property by Originator to the Borrower constituting
a “true conveyance” for bankruptcy purposes.

         

        (k) The
Borrower will not amend, modify, waive or terminate any terms or conditions of
the Purchase and Sale Agreement without the written consent of the Lender, and
shall perform its obligations thereunder.

         

        (l) The
Borrower will not make any amendment, modification or other change to its
certificate of formation or limited liability company agreement that would
materially and adversely affect the Lender without the Lender’s prior written
consent, and shall notify the Lender prior to making any amendment, modification
or other change to its certificate of formation or limited liability company
agreement prior to the effectiveness thereof.

         

        (m) Neither
the Borrower nor (if the Servicer is LEAF Financial or an Affiliate thereof) the
Servicer will make or allow to be made any material amendment to the Credit and
Collection Policy without the prior written consent of the Lender (and the
Lender hereby agrees to take commercially reasonable efforts to respond to any
request for such consent in a timely manner).  Neither the Borrower
nor (if the Servicer is LEAF Financial or an Affiliate thereof) the Servicer
will make or allow to be made any non-material amendment to the Credit and
Collection Policy without the prior written consent of the Lender; provided,
that if the Lender has not responded to a written  request for such
consent within ten (10) Business Days of receipt thereof, the Lender shall be
deemed to have consented to such request.

         

        (n) If
the Borrower or the Servicer receives any Collections with respect to any
Pledged Receivable, the Borrower or the Servicer, as applicable, will remit such
Collections to the Collection Account within one (1) Business Day of the
Borrower’s or the Servicer’s identification thereof.

         

        (o) The
Servicer shall cause:

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      Obligor under each Contract to remit all payments owed or otherwise
      payable (including, without limitation, amounts payable by the Obligor in
      its role as a servicer of Underlying Contracts sold to the Originator) by
      such Obligor under such Contract (or any servicer on its behalf) to the
      Lockbox or by wire transfer to the Lockbox
  Account;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      Lockbox Bank to deposit all Collections with respect to any Pledged
      Receivable in the Lockbox into the Lockbox Account on each Business Day;
      and

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      Lockbox Bank to remit all Collections with respect to any Pledged
      Receivable on deposit in the Lockbox Account (or any sub-account thereof
      or any related account) to the Collection Account on each Business
      Day.

                

        

         

        (p) The
Borrower shall deliver or cause to be delivered to the Custodian four (4)
Business Days prior to the initial Borrowing Date hereunder and three (3)
Business Days prior to any other Borrowing Date hereunder a Notice of Pledge and
each item listed in the definition of Receivable File with respect to the
Receivables being Pledged hereunder on such Borrowing Date.

         

        (q) The
Borrower shall deliver to the Lender on each Purchase Date a copy of the
Assignment delivered to it on such Purchase Date.

         

        
          
            
            

          

          
            49

            
              

            

          

          
            
            

          

        

        (r) Each
of the Servicer (and, if the Servicer is not LEAF Financial or an Affiliate
thereof, upon the Servicer gaining knowledge thereof) and the Borrower shall
promptly notify the Lender of the occurrence of any Servicer Default, Event of
Default, Program Termination Event, Pool A Termination Event or Pool B
Termination Event (any event that, if it continues uncured, would, with lapse of
time or notice or lapse of time and notice, constitute any Servicer Default,
Event of Default, Program Termination Event, Pool A Termination Event or
Pool B Termination Event).

         

        (s) Each
of the Servicer (if the Servicer is LEAF Financial or an Affiliate thereof) and
the Borrower shall take all actions (in the case of Obligor Collateral with an
original cost over $100,000) and all commercially reasonable actions (in the
case of Obligor Collateral with an original cost of $100,000 or less) necessary
to ensure that the Originator is at all times named as loss payee under each
Insurance Policy with respect to Obligor Collateral related to a Pledged
Receivable.

         

        (t) On
each Borrowing Date, a Qualifying Interest Rate Swap, in form and substance
satisfactory to the Lender, shall be duly executed by the Borrower and a
Qualifying Swap Counterparty, and any amounts required to have been paid
thereunder as of such Remittance Date shall have been paid and any obligations
required to have been performed thereunder as of such Remittance Date shall have
been performed.

         

        (u) Each
of the Servicer (if the Servicer is LEAF Financial or an Affiliate thereof) and
the Borrower shall take all actions necessary to ensure that each Pool B
Contract purchased by the Borrower under the Purchase and Sale Agreement
contains “Seller Events of Default” or similar events of default (“Parallel Defaults”)
which (i) would occur if a Pool B Termination Event with respect to the related
Underlying Originator occurred, (ii) would entitle the Borrower, as assignee of
the Originator’s rights under such Contract, to deliver, or cause the delivery
of, redirection notices which would require all Underlying Obligors to make all
payments under Underlying Contracts sold or pledged to the Originator under such
Contract to the Lockbox Account or an account designated by the Borrower or such
Servicer and (iii) would entitle the Borrower, as assignee of the Originator’s
rights under the Contract, to receive 100% of all payments under the Underlying
Contracts sold or pledged to the Originator under such Contract in the event of
such a Parallel Default.  If a Parallel Default or any “Seller Events
of Default” or similar events of default under a Pool B Contract related to the
financial condition of the applicable Underlying Originator, the tangible net
worth of the applicable Underlying Originator or any cross default (a Parallel
Default or any such “Seller Events of Default” or similar events of default
being referred to herein as “Critical Defaults”)
shall occur, then each of the Servicer (if the Servicer is LEAF Financial or an
Affiliate thereof) and the Borrower shall take all actions necessary to ensure
(x) that no such Critical Default is waived and (y) the prompt delivery to all
related Underlying Obligors of a redirection notice which would require such
Underlying Obligors to make all payments under Underlying Contracts sold or
pledged to the Originator under such Contract to the Lockbox
Account.  Each of the Servicer and the Borrower shall notify the
Lender promptly upon learning of the occurrence of any “Seller Event of Default”
or similar event of default under any Pool B Contract.

         

        (v) The
Borrower shall not acquire any debt obligation or interest therein if, after
giving effect to such acquisition, more than 40 percent of the debt obligations
or interests therein held by the Borrower (as determined under the rules of
Treasury Regulation 301.7701(i)-1(c)) would consist of real estate mortgages or
interests therein (as defined in Treasury Regulation
301.7701(i)-1(d)).

         

        (w)(w)  In
connection with satisfying the Titling Requirements, the Servicer shall take
commercially reasonable efforts to deliver or cause to be delivered to the
Custodian in accordance with this Agreement and the Custodial Agreement, the
original certificate of title for each Vehicle registered in
Florida.

         

         (x)  The Pledged Receivables shall not
be refinanced with any proceeds of the Netbank Facility.

         

        
          	
                   
      

                	
                  ARTICLE
      VI.

                

        

         

        
          	
                   
      

                	
                  ADMINISTRATION
      AND SERVICING; CERTAIN COVENANTS

                

        

         

        SECTION
6.01 Appointment
and Designation of the Servicer.  a) The Borrower and the
Lender hereby appoint the Person designated by the Lender from time to time,
pursuant to this Section 6.01
(the “Servicer”), as their
agent to service, administer and collect the Pledged Receivables and otherwise
to enforce their respective rights

         

        
          
            
            

          

          
            50

            
              

            

          

          
            
            
and
interests in and under the Pledged Receivables and the other Pledged
Assets.  The Servicer shall collect such Pledged Receivables under the
conditions referred to above by means of the collection procedures as set forth
in the Credit and Collection Policy, to the extent consistent with the
provisions of this Article VI.  Unless
otherwise specified by the Borrower, the Servicer’s authorization under this
Agreement shall terminate on the Collection Date.  Until the Lender
gives notice to the Borrower of a designation of a new Servicer upon the
occurrence and during the continuance of any Servicer Default, or consents in
writing to the appointment by the Borrower of a new Servicer, LEAF Financial is
hereby designated as, and hereby agrees to perform the duties and obligations
of, the Servicer, pursuant to the terms hereof at all times until the earlier of
the Lender’s designation of the Backup Servicer or any other Person as the new
Servicer (upon the occurrence and during the continuance of any Servicer
Default), the delivery by the Lender of its written consent to the appointment
by the Borrower of a new Servicer or the Collection Date.  Upon the
occurrence and during the continuance of any Servicer Default, the Lender may at
any time designate as Servicer the Backup Servicer, or any other Person with
demonstrated experience in servicing equipment leases and loans, to succeed LEAF
Financial or any successor Servicer, on the condition in each case that any such
Person so designated shall agree to perform the duties and obligations of the
Servicer pursuant to the terms hereof.  Each of the Borrower and LEAF
Financial hereby grants to any successor Servicer an irrevocable power of
attorney to take any and all steps in the Borrower’s, LEAF Financial’s or the
Servicer’s name, as applicable, and on behalf of the Borrower or LEAF Financial,
necessary or desirable, in the determination of such successor Servicer, to
service, administer or collect any and all Pledged Receivables including,
without limitation, to make withdrawals from the Security Deposit Account
pursuant to Section 2.05 and
any Cash Reserve Account pursuant to Section 2.06.

        

         

        (b) The
Servicer is hereby authorized to act for the Borrower and the Lender and, in
such capacity, shall manage, service, administer and arrange collections on the
Pledged Receivables and perform the other actions required by the Servicer under
this Agreement for the benefit of the Lender.  The Servicer agrees
that its servicing of the Pledged Receivables shall be carried out in accordance
with customary and usual procedures of institutions which service equipment
lease and loan contracts and receivables and, to the extent more exacting, the
degree of skill and attention that the Servicer exercises from time to time,
with respect to all comparable equipment lease and loan contracts and
receivables that it services for itself or others in accordance with the Credit
and Collection Policy (or if the Backup Servicer has been appointed as Servicer,
the Backup Servicer’s customary collection policies) and, to the extent more
exacting, the requirements of this Article VI.  The
Servicer’s duties shall include, without limitation, collecting and posting of
all Collections with respect to any Pledged Receivable, responding to inquiries
of Obligors on the Pledged Receivables, investigating delinquencies, sending
invoices, payment statements or payment books to Obligors, reporting any
required tax information to Obligors, policing the collateral, enforcing the
terms of the Contracts (and any documents related thereto) related to any
Pledged Receivables, complying with the terms of the Lockbox Agreement,
accounting for Collections with respect to any Pledged Receivable, furnishing
monthly and annual statements to the Lender with respect to distributions and
performing the other duties specified herein.

         

        (c) The
Servicer will require each Underlying Originator to (i) service all
Underlying Contracts in a manner consistent with the applicable Underlying
Originator Credit and Collection Policy (which the Servicer has reviewed and
approved in accordance with the Credit and Collection Policy) and
(ii) provide to the Servicer a monthly data feed, which shall be in form
and content satisfactory to the Servicer.  The Servicer shall, or
shall cause a third party servicer appointed by the Servicer and approved by the
Lender (such approval not to be unreasonably withheld) to, provide servicing
similar to the servicing that the Servicer is obligated to provide hereunder
with respect to any Underlying Contracts to the extent that the related
Underlying Originator fails to service such Underlying Contracts in a manner
consistent with the applicable Underlying Originator Credit and Collection
Policy.

         

        (d) To
the extent consistent with the standards, policies and procedures otherwise
required hereby, the Servicer shall have full power and authority, acting alone,
to do any and all things in connection with such managing, servicing,
administration and collection that it may deem necessary or
desirable.  The Servicer is authorized to release liens on Obligor
Collateral in order to collect insurance proceeds with respect thereto and to
liquidate such Obligor Collateral in accordance with its customary standards,
policies and procedures; provided, however, that,
notwithstanding the foregoing, the Servicer shall not, (i) except pursuant
to an order from a court of competent jurisdiction, release an Obligor from
payment of any unpaid amount under any Pledged Receivable or (ii) waive the
right to collect the unpaid balance of any Pledged Receivable from such Obligor,
except that, subject to Section 6.02(a),
the Servicer may forego collection efforts if the amount which the Servicer, in
its reasonable

         

        
          
            
            

          

          
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judgment,
expects to realize in connection with such collection efforts is determined by
the Servicer, in its reasonable judgment, to be less than the reasonably
expected costs of pursuing such collection efforts and if the Servicer would
forego such collection efforts in accordance with its customary
procedures.  The Servicer is hereby authorized to commence, in its own
name (in its capacity as Servicer), if possible, or in the name of the Borrower
or the Lender (provided that if the
Servicer is acting in the name of the Borrower or the Lender, the Servicer shall
have obtained the Borrower’s or the Lender’s consent, as the case may be, which
consent shall not be unreasonably withheld), a legal proceeding to enforce any
Pledged Receivable (or any terms or provisions of the related Contract) or to
commence or participate in any other legal proceeding (including, without
limitation, a bankruptcy proceeding) relating to or involving a Pledged
Receivable or any related Contract, Obligor or Obligor Collateral.  If
the Servicer commences or participates in such a legal proceeding in its own
name, the Borrower or the Lender, as the case may be, shall thereupon be deemed
to have automatically assigned such Pledged 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 Borrower or the
Lender, as the case may be, 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.  The Borrower
or the Lender, as the case may be, shall furnish the Servicer with any powers of
attorney and other documents which the Servicer may reasonably request in
writing and which the Servicer deems necessary or appropriate and take any other
steps which the Servicer may deem necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties under this
Agreement.  If, however, in any suit or legal proceeding it is held
that the Servicer may not prosecute such suit or legal proceeding on the grounds
that it is not an actual party in interest or a holder entitled to enforce such
suit or legal proceeding, the Borrower shall take such steps as the Servicer
deems necessary to prosecute such suit or legal proceeding, including bringing
suit in its name.

        

         

        SECTION
6.02 Collection
of Receivable Payments; Modification and Amendment of Receivables; Lockbox
Agreements.  a) Consistent with and subject to the standards,
policies and procedures required by this Agreement, the Servicer shall collect
all payments called for under the terms and provisions of the Contracts related
to the Pledged Receivables (and the terms and provisions of any documents
related thereto) as and when the same shall become due and shall follow such
collection procedures with respect to the Pledged Receivables and the related
Contracts and Insurance Policies as will, in the reasonable judgment of the
Servicer, maximize the amount to be received by the Borrower and the Lender with
respect thereto.

         

        (b) The
Servicer shall remit all payments by or on behalf of the Obligors received
directly by the Servicer to the Collection Account, without deposit into any
intervening account as soon as practicable, but in no event later than the end
of business on the Business Day of identification thereof as payments by or on
behalf of the Obligors.

         

        SECTION
6.03 Realization
Upon Receivables.  Consistent with the standards, policies and
procedures required by this Agreement, the Servicer shall use its best efforts
to repossess (or otherwise comparably convert the ownership of) and liquidate
any Obligor Collateral securing a Pledged Receivable within a number of days
consistent with the Credit and Collection Policy of an uncured failure of
the related Obligor to make any payment which it is obligated to make under the
related Contract or an earlier date that would be customary under the
circumstances involved (as determined in accordance with the Credit and
Collection Policy) and, in any case, in a manner as will, in the reasonable
judgment of the Servicer, maximize the amount to be received by the Borrower and
the Lender with respect thereto; provided, however, that the
Servicer need not repossess (or otherwise comparably convert the ownership of)
and liquidate the Obligor Collateral securing such a Pledged Receivable if, in
the reasonable opinion of the Servicer, the value of such Obligor Collateral
does not exceed by more than an insignificant amount the cost to repossess (or
otherwise comparably convert the ownership of) and liquidate such Obligor
Collateral.  The Servicer is authorized to follow such customary
practices and procedures as it shall deem necessary or advisable, consistent
with the standard of care required by Section 6.01,
which practices and procedures may include reasonable efforts to realize upon
any guaranties, selling the related Obligor Collateral at public or private
sale, the submission of claims under an Insurance Policy and other actions by
the Servicer in order to realize upon such Pledged Receivable.  The
foregoing is subject to the provision that, in any case in which the Obligor
Collateral shall have suffered damage, the Servicer shall not expend funds in
connection with any repair or towards the repossession of such Obligor
Collateral, unless it shall determine in its discretion that such repair and/or
repossession shall increase the proceeds of liquidation of the related Pledged
Receivable by an amount greater than the amount of such expenses.  All
Liquidation Proceeds shall be remitted directly by the Servicer to the
Collection Account without deposit into any intervening account as soon as
practicable, but in no event later than one (1)

         

        
          
            
            

          

          
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Business
Day after identification thereof as Liquidation Proceeds.  The
Servicer shall pay on behalf of the Borrower any personal property taxes
assessed on repossessed Obligor Collateral, and the Servicer shall be entitled
to reimbursement of any such tax as a Servicer Advance.

        

         

        SECTION
6.04 Insurance
Regarding Equipment.  a) At the time of the Pledge of any
Receivable hereunder, the Servicer shall require each Obligor to obtain and
maintain (or with respect to an Underlying Originator, cause the Underlying
Obligor to obtain and maintain) Insurance Policies in accordance with the terms
of the Credit and Collection Policy and its customary servicing procedures and
shall furnish evidence of such insurance (except if the Equipment or Underlying
Equipment relating to such Obligor or Underlying Obligor, as applicable, has an
aggregate original cost of $100,000 or less) to the Lender.

         

        (b) The
Servicer may, and upon the request of the Lender shall, sue to enforce or
collect upon the Insurance Policies, in its own name (but in its capacity as
Servicer), if possible, or as agent of the Borrower and the
Lender.  If the Servicer elects to commence a legal proceeding to
enforce an Insurance Policy, the act of commencement shall be deemed to be an
automatic assignment of the rights of the Borrower and the Lender under such
Insurance Policy to the Servicer for purposes of collection only.  If,
however, in any enforcement suit or legal proceeding it is held that the
Servicer may not enforce an Insurance Policy on the grounds that it is not an
actual party in interest or a holder entitled to enforce the Insurance Policy,
the Borrower shall take such steps as the Servicer deems necessary to enforce
such Insurance Policy, including bringing suit in its name.

         

        SECTION
6.05 Maintenance
of Security Interests in Obligor Collateral.  a) The initial
Servicer and the Borrower shall take all steps necessary, under all applicable
law, in order to (i) cause a valid, subsisting and enforceable first
priority perfected security interest to exist in favor of the Collateral Agent
in the Borrower’s interests in the Obligor Collateral, all Other Conveyed
Property and all Related Security related to each Receivable (and the proceeds
thereof) being Pledged hereunder, to secure a Loan on the Borrowing Date thereof
including (A) the filing of a UCC financing statement in the applicable
jurisdiction adequately describing the Obligor Collateral, Other Conveyed
Property and all Related Security and naming the Borrower as debtor and the
Collateral Agent as the secured party, (B) filing Obligor Financing
Statements against all Obligors purchasing or leasing Obligor Collateral,
(C) other than with respect to an Underlying Lease Contract related to
Equipment which has an original cost of less than $25,000 if such Underlying
Lease Contract is a Dollar Purchase Option Contract or $50,000 if such
Underlying Lease Contract is a FMV Contract, causing the filing of UCC-3
assignment statements in the applicable jurisdictions adequately describing the
Underlying Originator Loan Collateral being transferred thereunder and naming
the applicable Underlying Originator as the assignor and Originator as the
assignee, and (D) other than with respect to an Underlying Lease Contract
related to Equipment which has an original cost of less than $25,000 if such
Underlying Lease Contract is a Dollar Purchase Option Contract or $50,000 if
such Underlying Lease Contract is a FMV Contract, causing the filing of UCC-3
assignment statements in the applicable jurisdictions adequately describing the
Underlying Originator Loan Collateral being transferred thereunder and naming
the applicable Underlying Originator as the assignor and Originator as the
assignee (ii) ensure that such security interest is and shall be prior to
all other liens upon and security interests in the Borrower’s interests in such
Obligor Collateral, Other Conveyed Property and Related Security (and the
proceeds thereof) that now exist, or may hereafter arise or be created other
than Permitted Liens, and (iii) ensure that immediately prior to the Pledge
of such Receivable by the Borrower to the Collateral Agent, such Obligor
Collateral, Other Conveyed Property and Related Security is free and clear of
all Adverse Claims other than Permitted Liens; and

         

        (b) The
initial Servicer shall take all steps, as are necessary (subject to Section 6.05(a)),
to maintain perfection of the security interest in the Borrower’s interests in
the Obligor Collateral, Other Conveyed Property and Related Security related to
each Pledged Receivable (and the proceeds thereof) in favor of the Collateral
Agent including but not limited to, obtaining the execution by the Borrower and
the recording, registering, filing, rerecording, refiling, and reregistering of
all security agreements, financing statements and continuation statements as are
necessary to maintain and/or perfect such security interests granted by the
Borrower and the recordation of the Borrower’s or the applicable Approved
Lienholder’s lien on the Certificate of Title for any Vehicle included in such
Obligor Collateral, all in accordance with the Titling
Requirements.  Without limiting the generality of the foregoing, the
Borrower and the Lender each hereby authorizes the initial Servicer, and the
initial Servicer agrees, to take any and all steps necessary (subject to Section 6.05(a))
to re-perfect the security interest in the Borrower’s interests in any Obligor
Collateral (and the Borrower’s interests therein), Other Conveyed Property and
Related Security
related to each Pledged Receivable (and the proceeds thereof) in favor of the
Collateral Agent as may be necessary, due to the relocation of such Obligor
Collateral or for any other reason.

         

        
          
            
            

          

          
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        SECTION
6.06 Pledged
Receivable Receipts.  The Servicer shall make a deposit into
the Collection Account in an amount equal to the Collections with respect to any
Pledged Receivable received, or made by, or on behalf of it, within one Business
Day of such Collections being received, or made by, or on behalf of
it.

         

        SECTION
6.07 No Rights of
Withdrawal.  Until the Collection Date, the Borrower shall have
no rights of direction or withdrawal, with respect to amounts held in the
Collection Account or the Lockbox Account, except with respect to funds not
related to any Pledged Assets, which were incorrectly deposited into any such
account.

         

        SECTION
6.08 Permitted
Investments.  The Borrower shall, pursuant to written
instruction, direct the Lender’s Bank (and if the Borrower fails to do so, the
Lender may, pursuant to written instruction, direct the Lender’s Bank) to
invest, or cause the investment of, funds on deposit in the Collection Account
in Permitted Investments, from the date of this Agreement until the Collection
Date.  Absent any such written instruction, the Lender’s Bank shall
invest, or cause the investment of, such funds in Permitted Investments
described in clause (v) of the definition thereof.  A Permitted
Investment acquired with funds deposited in the Collection Account shall mature
not later than the Business Day immediately preceding any Remittance Date, and
shall not be sold or disposed of prior to its maturity.  All such
Permitted Investments shall be registered in the name of the Securities
Intermediary (as defined in the Securities Account Agreement) or its nominee for
the benefit of the Lender, and otherwise comply with assumptions of the legal
opinion of Thacher Proffitt & Wood LLP, delivered in connection with this
Agreement.  All income and gain realized from any such investment, as
well as any interest earned on deposits in the Collection Account, shall be
distributed in accordance with the provisions of Article II
hereof.  The Borrower shall deposit in the Collection Account, as the
case may be (with respect to investments made hereunder of funds held therein),
an amount equal to the amount of any actual loss incurred, in respect of any
such investment, immediately upon realization of such loss.  None of
the Lender’s Bank or the Lender shall be liable for the amount of any loss
incurred, in respect of any investment, or lack of investment, of funds held in
the Collection Account.

         

        SECTION
6.09 Servicing
Compensation.  As compensation for its activities hereunder,
the Servicer shall be entitled to be paid the Servicing Fee from the Collection
Account as provided in Section 2.04(c).  The
Servicer shall be required to pay all expenses incurred by it in connection with
its servicing activities hereunder and shall not be entitled to reimbursement
therefor, except with respect to reasonable expenses of the Servicer incurred in
connection with the repossession and disposition of any Obligor Collateral
(which the Servicer may retain from the proceeds of the disposition of such
Obligor Collateral) and any Servicer Advances made by the Servicer pursuant
hereto.  The Servicing Fee may not be transferred in whole, or in
part, except in connection with the transfer of all the Servicer’s
responsibilities and obligations under this Agreement.  At any time
after the occurrence of a Servicer Default and the appointment of the Backup
Servicer as the Servicer hereunder, the Backup Servicer shall be entitled to
receive an amount, payable out of Collections on the Pledged Receivables and
amounts applied to the payment of, or treated as payments on, the Pledged
Receivables, equal to expenses incurred by the Backup Servicer, acting in its
capacity as the Servicer, in connection with its obligations under Sections
6.05(a), (b) and (c) hereof (such
expenses, the “Active
Backup Servicer’s Indemnified Amounts”).

         

        SECTION
6.10 Reports to
the Lender; Account Statements; Servicing Information.  a) The
Borrower will deliver to the Lender and each Qualifying Swap Counterparty,
(i) on the Program Termination Date, a report identifying the Pledged
Receivables (and any information with respect thereto requested by the Lender)
on the day immediately preceding the Program Termination Date, and
(ii) upon the Lender’s reasonable request and upon reasonable notice, on
any other Business Day, a report identifying the Pledged Receivables (and any
information with respect thereto, reasonably requested by the Lender) as of such
day.

         

        (b) At
least four (4) Business Days prior to each Remittance Date, the Servicer shall
prepare and deliver, or have delivered to the Lender and each Qualifying Swap
Counterparty, (i) a Monthly Remittance Report and any other information
reasonably requested by the Lender, relating to all Pledged Receivables
(including, if requested, a Computer Tape or Listing), all information in the
Monthly Remittance Report and all other such information to be accurate as of
the last day of the immediately preceding Collection Period, and (ii) in an
electronic format mutually acceptable to the Servicer and the Lender, all
information reasonably requested by the Lender relating to all Pledged
Receivables.  If any Monthly Remittance Report indicates the existence
of a Borrowing Base Deficiency, the Borrower
shall, on the date of delivery of such Monthly Remittance Report, prepay to the
Lender, for the account of the Lender, a portion of the Loans as is necessary to
cure such Borrowing Base Deficiency (or otherwise cure such Borrowing Base
Deficiency).

         

        
          
            
            

          

          
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        (c) By
no later than 12:00 noon (New York City time) on the third Business Day
immediately preceding a Borrowing, the Borrower (or the initial Servicer on its
behalf) shall also prepare and deliver to the Lender a Borrowing Base
Certificate containing information accurate as of the date of delivery of such
Borrowing Base Certificate.  If any Borrowing Base Certificate
indicates the existence of a Borrowing Base Deficiency, the Borrower shall on
the date of delivery of such Borrowing Base Certificate prepay to the Lender,
for the account of the Lender, a portion of the Loans or Pledge additional
Eligible Receivables, in either case, to the extent necessary to cure such
Borrowing Base Deficiency.

         

        (d) At
least four (4) Business Days prior to each Remittance Date (each such day, a
“Backup Servicer
Delivery Date”), the Servicer shall prepare and deliver, or have
delivered, to the Backup Servicer (i) a Monthly Remittance Report in
respect of the immediately-preceding Collection Period and (ii) a computer
tape or a diskette or any other electronic transmission in a format acceptable
to the Backup Servicer containing the information with respect to the Pledged
Receivables during such Collection Period which was necessary for preparation of
such Monthly Remittance Report or is reasonably requested by the Backup
Servicer.

         

        (e) The
Borrower shall deliver to the Lender all reports it receives pursuant to the
Purchase and Sale Agreement within one Business Day of the receipt
thereof.

         

        SECTION
6.11 Statements
as to Compliance; Financial Statements.  a) The Servicer shall
deliver to the Backup Servicer, the Borrower and the Lender on or before March
31st of each year, beginning with 2007, an Officers’ Certificate stating, as to
each signatory thereof, that (x) a review of the activities of the Servicer
during the preceding calendar year (or the portion of the preceding calendar
year commencing on the date of this Agreement and ending December 31, 2006
in the case of the first such review) and of its performance under this
Agreement has been made under such officer’s supervision, and (y) to the
best of such officers’ knowledge, based on such review, the Servicer has
fulfilled all of its obligations under this Agreement throughout such calendar
year (or portion thereof, as the case may be) or, if there has been a default in
the fulfillment of any such obligation, specifying each such default known to
such officers and the nature and status thereof and the action being taken to
cure such default.

         

        (b) The
Servicer (if LEAF Financial or an Affiliate thereof) shall, at its expense,
cause a firm of nationally recognized independent certified public accountants
acceptable to the Lender (the “Independent
Accountants”), who may also render other services to the Servicer, the
Backup Servicer or to the Borrower, to deliver to the Borrower and the Lender,
on or before March 31st of each year, beginning 2007, with respect to the twelve
(12) months ended the immediately preceding December 31, a statement (the
“Accountant’s
Report”) addressed to the Board of Directors of the Servicer and to the
Lender, to the effect that such firm has examined such Borrowing Base
Certificates and Monthly Remittance Reports prepared by the Servicer during the
twelve (12) months ended the immediately preceding December 31 as it deemed
necessary in order to issue the Accountants’ Report and issued its report
thereon, and that such examination was made in accordance with generally
accepted auditing standards and, accordingly, included such tests of the
accounting records and such other auditing procedures as such firm considered
necessary in the circumstances.  The Accountants’ Report shall further
state that (i) a review in accordance with agreed upon procedures was made;
and (ii) except as disclosed in the Accountant’s Report, no exceptions or
errors in the Borrowing Base Certificates and Monthly Remittance Reports
examined were found except for (A) such exceptions as the Independent
Accountants believe to be immaterial and (B) such other exceptions as shall
be set forth in the Accountants’ Report.  The Accountants’ Report
shall also indicate that the firm is independent of the Borrower and the
Servicer within the meaning of the Code of Professional Ethics of the American
Institute of Certified Public Accountants.

         

        (c) As
soon as available and no later than forty-five (45) days after the end of each
calendar quarter in each fiscal year of the Borrower or Resource America, the
Borrower shall deliver to the Lender two copies of:

         

        
          	
                   
      

                	
                  (i)

                	
                  a
      balance sheet of the Borrower and Resource America as of the end of such
      calendar quarter, setting forth in comparative form the corresponding
      figures for the most recent year-end for which an audited balance sheet
      has been prepared, which balance sheet shall be prepared and presented in
      accordance with, and provide all necessary disclosure required by, GAAP
      and shall be accompanied by a certificate signed by the financial vice
      president, treasurer, chief financial office or controller of the Borrower
      or Resource America, as applicable, stating that such balance sheet
      presents fairly the financial condition of the Borrower or Resource
      America, as the case may be, and has been prepared in accordance with GAAP
      consistently applied; and

                

        

         

        
          
            
            

          

          
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                  (ii)

                	
                  statements
      of income, stockholders’ equity and cash flow of the Borrower and Resource
      America for such calendar quarter setting forth in comparative form the
      corresponding figures for the comparable period one year prior thereto
      (subject to normal year-end adjustments), which such statements shall be
      prepared and presented in accordance with, and provide all necessary
      disclosure required by, GAAP and shall be accompanied by a certificate
      signed by the financial vice president, treasurer, chief financial officer
      or controller of the Borrower or Resource America, as applicable, stating
      that such financial statements present fairly the financial condition and
      results of operations of the Borrower or Resource America, as the case may
      be, and have been prepared in accordance with GAAP consistently
      applied.

                

        

         

        (d) As
soon as available and no later than forty-five (45) days after the end of each
calendar quarter in each fiscal year of Resource America, LEAF Financial shall
deliver to the Lender two copies of:

         

        
          	
                   
      

                	
                  (i)

                	
                  a
      consolidated balance sheet of Resource America and its consolidated
      subsidiaries (including Originator and Servicer) as of the end of such
      calendar quarter, setting forth in comparative form the corresponding
      figures for the most recent year-end for which an audited balance sheet
      has been prepared, which such balance sheet shall be prepared and
      presented in accordance with, and provide all necessary disclosure
      required by, GAAP and shall be accompanied by a certificate signed by the
      financial vice president, treasurer, chief financial officer or controller
      of Resource America stating that such balance sheet presents fairly the
      financial condition of the companies being reported upon and has been
      prepared in accordance with GAAP consistently applied;
  and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  consolidated
      statements of income, stockholders’ equity and cash flow of Resource
      America and its consolidated subsidiaries (including Originator and
      Servicer) for such calendar quarter, in each case, setting forth in
      comparative form the corresponding figures for the comparable period one
      year prior thereto (subject to normal year-end adjustments), which such
      statements shall be prepared and presented in accordance with, and provide
      all necessary disclosure required by, GAAP and shall be accompanied by a
      certificate signed by the financial vice president, treasurer, chief
      financial officer or controller of Resource America stating that such
      financial statements present fairly the financial condition and results of
      operations of the companies being reported upon and have been prepared in
      accordance with GAAP consistently
applied.

                

        

         

        (e) As
soon as available and no later than ninety (90) days after the end of each
fiscal year of the Borrower or Resource America, LEAF Financial shall deliver to
the Lender two copies of:

         

        
          	
                   
      

                	
                  (i)

                	
                  a
      balance sheet of the Borrower and Resource America as of the end of the
      fiscal year, setting forth in comparative form the figures for the
      previous fiscal year and accompanied by an opinion of a firm of
      independent certified public accountants of nationally recognized standing
      acceptable to the Lender stating that such balance sheet presents fairly
      the financial condition of the Borrower or Resource America, as
      applicable, and has been prepared in accordance with GAAP consistently
      applied (except for changes in application in which such accountants
      concur); and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  statements
      of income, stockholders’ equity and cash flow of the Borrower and Resource
      America for such fiscal year, setting forth in comparative form the
      figures for the previous fiscal year and accompanied by an opinion of a
      firm of independent certified public accountants of nationally recognized
      standing acceptable to the Lender stating that such financial statements
      present fairly the financial condition of the Borrower or Resource
      America, as applicable, and have been prepared in accordance with GAAP
      consistently applied (except for changes in application in which such
      accountants concur).

                

        

         

         

        
          
            
            

          

          
            56

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (f)  As
      soon as available and no later than ninety (90) days after the end of each
      fiscal year of Resource America, LEAF Financial shall deliver to the
      Lender two copies of:

                

        

         

        
          	
                   
      

                	
                  (i)

                	
                  a
      consolidated and consolidating balance sheet of Resource America and its
      consolidated subsidiaries (including Originator and Servicer) as of the
      end of the fiscal year, setting forth in comparative form the figures for
      the previous fiscal year and accompanied by an opinion of a firm of
      independent certified public accountants of nationally recognized standing
      acceptable to the Lender stating that such balance sheet presents fairly
      the financial condition of the companies being reported upon and has been
      prepared in accordance with GAAP consistently applied (except for changes
      in application in which such accountants concur);
  and

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  consolidated
      and consolidating statements of income, stockholders’ equity and cash flow
      of Resource America and its consolidated subsidiaries (including
      Originator) for such fiscal year; in each case setting forth in
      comparative form the figures for the previous fiscal year and accompanied
      by an opinion of a firm of independent certified public accountants of
      nationally recognized standing acceptable to the Lender stating that such
      financial statements present fairly the financial condition of the
      companies being reported upon and have been prepared in accordance with
      GAAP consistently applied (except for changes in application in which such
      accountants concur).

                

        

         

        SECTION
6.12 Access to
Certain Documentation; Obligors; Background Check.  a) The
Lender (and its agents or professional advisors) shall at the expense of the
Borrower, have the right under this Agreement, once during each calendar quarter
until the first anniversary of the date hereof, and semi-annually thereafter, to
examine and audit, during business hours or at such other times as might be
reasonable under applicable circumstances, any and all of the books, records,
financial statements or other information of the Servicer and the Borrower, or
held by another for the Servicer or the Borrower or on its behalf, concerning
this Agreement, provided, that, prior
to the occurrence of an Event of Default, the Borrower shall not be responsible
for the expenses of the Lender to the extent that such expenses exceed $25,000
in the aggregate in any calendar year.  The Lender (and its agents or
professional advisors) shall, at the expense of the Borrower and as frequently
as the Lender may desire, have the right under this Agreement after the
occurrence and during the continuance of an Event of Default, to examine and
audit, during business hours or at such other times as might be reasonable under
applicable circumstances, any and all of the books, records or other information
of the Servicer or the Borrower, or held by another for the Servicer or the
Borrower or on its behalf, concerning this Agreement.  The Lender (and
its agents and professional advisors) shall coordinate examinations and audits
under this Section
6.12(a) in order to minimize expense and inconvenience to the
Borrower.  The Lender (and its agents and professional advisors) shall
treat as confidential any information obtained during the aforementioned
examinations which is not already publicly known or available; provided, however, that the
Lender may disclose such information if required to do so by law or by any
regulatory authority.

         

        (b) The
Lender (and its agents or professional advisors) shall, at its own expense, have
the right under this Agreement to contact Pool A Obligors and Pool B Obligors
once with respect to any Receivable which is Pledged hereunder to request that
each such Obligor verify and confirm by return letter the existence and amount
of such Receivable, the type of Equipment leased under or securing the related
Contract and such other information as the Lender deems reasonable under the
circumstances (each such return letter to be mailed to a post office box
established by the Lender).  The Servicer and the Borrower hereby
agree to cooperate with the Lender (and its agents or professional advisors) in
connection with any attempt thereby to contact any such Obligor and shall
provide to the Lender such information as is needed in order to facilitate such
contact.  The Lender (and its agents and professional advisors) shall
treat as confidential any information obtained during any such contact with any
such Obligor which is not already publicly known or available; provided,
however, that the Lender (and its agents or professional advisors) may disclose
such information if required to do so by law or by any regulatory
authority.

         

        (c) The
Lender (or its agents and/or third party professional advisors) may, from time
to time, cause comprehensive background checks on newly-hired senior management,
key employees and principals of each of Resource Capital Corp., the initial
Servicer and Originator to be completed by an investigation service acceptable
to the Lender, at the Borrower’s expense.

         

        
          
            
            

          

          
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        SECTION
6.13  Backup
Servicer.  If a Servicer Default shall occur, then the Lender
may, by notice to the Servicer, the Borrower and the Backup Servicer, terminate
all of the rights and obligations of the Servicer under this
Agreement.  Upon the delivery to the Servicer of such notice, all
authority and power of the Servicer under this Agreement, whether with respect
to the Pledged Assets or otherwise, shall pass to and be vested in the Backup
Servicer pursuant to and under this Section (unless the Lender shall have
appointed a different successor Servicer pursuant to Section 6.01
hereof or the Backup Servicer is unable to act as Servicer and a successor is
appointed as provided in the fourth paragraph of this Section 6.13),
and, without limitation, the Backup Servicer is hereby authorized and empowered
to execute and deliver, on behalf of the 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
notice of termination or to perform the duties of the Servicer under this
Agreement including, without limitation, to make withdrawals from the Security
Deposit Account pursuant to Section 2.05 and
any Cash Reserve Account pursuant to Section 2.06.  The
Servicer agrees to cooperate with the Lender and the Backup Servicer in
effecting the termination of the Servicer’s responsibilities and rights
hereunder, including, without limitation, providing notification to the Obligors
of the assignment of the servicing function, providing notification to the
Lender’s Bank of the Backup Servicer’s right to make withdrawals from the
Security Deposit Account pursuant to Section 2.05 and any Cash Reserve Account
pursuant to Section 2.06, providing the Backup Servicer, at the Servicer's
expense, with all records, in electronic or other form, reasonably requested by
the Backup Servicer, in such form as the Backup Servicer may reasonably request
and at such times as the Backup Servicer may reasonably request, to enable the
Backup Servicer to assume the servicing functions hereunder and the transfer to
the Backup Servicer for administration by it of all cash amounts which at the
time should be or should have been deposited by the Servicer in the Collection
Account or thereafter be received by the Servicer with respect to the Pledged
Receivables.  Additionally, the Servicer agrees to cooperate in
providing, at the Servicer’s expense, the Backup Servicer as successor Servicer,
with reasonable access (including at the premises of the Servicer) to Servicer’s
employees and any and all books, records or other information reasonably
requested by it to enable the Backup Servicer, as successor Servicer, to assume
the servicing functions hereunder.  Neither the Lender nor the Backup
Servicer shall be deemed to have breached any obligation hereunder as a result
of a failure to make or delay in making any distribution as and when required
hereunder caused by the failure of the Servicer to remit any amounts received by
it or to deliver any documents held by it with respect to the Pledged
Assets.  The Backup Servicer (including as successor Servicer)
undertakes to perform only such duties and obligations as are specifically set
forth in this Agreement, it being understood by all parties hereto that there
are no implied duties or obligations of the Backup Servicer
hereunder.

         

        The
Active Backup Servicer’s Fees and Transition Costs shall be paid out of
Collections with respect to any Pledged Receivable as set forth in Section 2.04(c)
on and after the date, if any, that the Backup Servicer assumes the
responsibilities of the Servicer pursuant to this Section.  The
Standby Backup Servicer’s Fees and Transition Costs shall be paid out of
Collections with respect to any Pledged Receivable as set forth in Section 2.04(c)
prior to the date, if any, that the Backup Servicer assumes the responsibilities
of the Servicer pursuant to this Section.

         

        Any
obligations of LEAF Financial under any Transaction Document other than in its
capacity as Servicer shall continue in effect notwithstanding LEAF Financial’s
termination as Servicer.

         

        On and
after the time the Servicer receives a notice of termination pursuant to this
Section 6.13,
the Backup Servicer shall be (and the Backup Servicer hereby agrees to be) the
successor in all respects to the Servicer in its capacity as Servicer under this
Agreement and the transactions set forth or provided for herein and shall have
all the rights and powers and be subject thereafter to all the responsibilities,
duties and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof; provided, however, that any
failure to perform such duties or responsibilities caused by the Servicer’s
failure to provide information required by this Section 6.13
shall not be considered a default by the Backup Servicer hereunder; provided, further, however, that the
Backup Servicer, as successor Servicer, shall have (i) no liability with
respect to any obligation which was required to be performed by the terminated
Servicer prior to the date that the Backup Servicer becomes the successor to the
Servicer or any claim of a third party based on any alleged action or inaction
of the terminated Servicer, (ii) no obligation to perform any repurchase or
advancing obligations, if any, of the Servicer, (iii) no obligation to pay
any taxes required to be paid by the Servicer (provided that the Backup Servicer
shall pay any income taxes for which it is liable), (iv) no obligation to
pay any of the fees and expenses of any other party to the transactions
contemplated hereby, and (v) no liability or obligation with respect to any
Servicer indemnification obligations of any prior Servicer, including the
original Servicer.  The indemnification obligations of the Backup
Servicer, upon becoming a successor Servicer, are

         

        
          
            
            

          

          
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expressly
limited to those arising on account of its failure to act in good faith and with
reasonable care under the circumstances.  In addition, the Backup
Servicer shall have no liability relating to the representations and warranties
of the Servicer contained in Article IV.  Notwithstanding
the above, the Lender may, or shall, if the Backup Servicer is unable to so act,
appoint itself, or appoint any other established servicing institution
acceptable to the Lender in its sole discretion, as the successor to the
Servicer hereunder in the assumption of all or any part of the responsibilities,
duties or liabilities of the Servicer hereunder.  Pending appointment
of a successor to the Servicer hereunder, and after the Lender notifies the
Servicer to discontinue performing servicing functions under this Agreement, the
Backup Servicer (or the Lender if there is no Backup Servicer) shall act in such
capacity as hereinabove provided.  In connection with such appointment
and assumption, the Lender may make such arrangements for the compensation of
such successor out of payments on Pledged Receivables as it and such successor
shall agree; provided, however, that, except
as provided herein, no such compensation shall be in excess of that permitted
the Servicer hereunder, unless (i) agreed to by the Lender and
(ii) such compensation shall be on commercially competitive terms and
rates.  The Borrower, the Lender and such successor shall take such
action, consistent with this Agreement, as shall be necessary to effectuate any
such succession.  The parties hereto agree that in no event will the
Backup Servicer be liable for any special, indirect or consequential
damages.

        

         

        The
Backup Servicer hereby agrees that it shall, and shall take all actions
necessary so that it shall at all times be ready to, assume all the rights and
powers and all of the responsibilities, obligations and duties of the Servicer
hereunder, within ten (10) Business Days of receiving from the Lender a notice
requesting the Backup Servicer to do so.

         

        Notwithstanding
anything contained in this Agreement to the contrary, absent specific knowledge
by any Lyon Financial Services, Inc. account representative assigned to this
transaction from time to time, or written notice detailing specific Errors (as
defined below) or other deficiencies, Lyon Financial Services, Inc., as
successor Servicer, is authorized to accept and rely on all accounting records
(including computer records) and work product of the prior Servicer hereunder
relating to the Contracts (collectively, the “Predecessor Servicer Work
Product”) without any audit or other examination thereof, and Lyon
Financial Services, Inc. shall have no duty, responsibility, obligation or
liability for the acts and omissions of the prior Servicer.  If any
error, inaccuracy, commission or incorrect or nonstandard practice or procedure
(collectively, “Errors”) exists in
any Predecessor Servicer Work Product and such Errors cause Lyon Financial
Services, Inc. to make or continue any errors (collectively, “Continued Errors”),
Lyon Financial Services, Inc. shall have no liability for such Continued Errors;
provided, however, that Lyon
Financial Services, Inc. agrees to use its best efforts to prevent Continued
Errors.  In the event that Lyon Financial Services, Inc. becomes aware
of Errors or Continued Errors, Lyon Financial Services, Inc. shall, with the
prior consent of the Lender, use its best efforts to reconstruct and reconcile
any affected data as is commercially reasonable to correct such Errors and
Continued Errors and to prevent future Continued Errors.  Lyon
Financial Services, Inc. shall be entitled to recover its costs thereby expended
as Servicer Advances in accordance with Section 2.04(c)
hereof.

         

        Within
four (4) Business Days after each Remittance Date, provided that the Backup
Servicer shall have received the information specified in Section 6.10(d)
within the time specified therein, the Backup Servicer shall compare the
information on the computer tape or diskette (or other means of electronic
transmission acceptable to the Backup Servicer) most recently delivered to the
Backup Servicer by the Servicer pursuant to Section 6.10(d)
with respect to such Remittance Date to the corresponding Monthly Remittance
Report delivered to the Backup Servicer by the Servicer pursuant to Section 6.10(d)
and shall:

         

        (a) confirm
that such Monthly Remittance Report is complete on its face;

         

        (b) confirm
the distributions to be made on such Remittance Date pursuant to Section 2.04(c)
hereof to the extent the Backup Servicer is able to do so given the information
provided to it by the Servicer (it being hereby agreed that the Backup Servicer
shall promptly notify the Servicer and the Lender if such information is
insufficient and that the Servicer shall promptly provide to the Backup Servicer
any additional information required by the Backup Servicer);

         

        
          
            
            

          

          
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        (c) confirm
the mathematical computations of information in such Monthly Remittance Report;
and

         

        (d) confirm
such other information as the Backup Servicer and the Lender may
agree;

         

        In the
event of any discrepancy between the information set forth in
subparagraphs (b) or (c) above as calculated by the Servicer and that
determined or calculated by the Backup Servicer, the Backup Servicer shall
promptly report such discrepancy to the Servicer and the Lender.  In
the event of a discrepancy as described in the preceding sentence, the Servicer
and the Backup Servicer shall attempt to reconcile such discrepancy within five
(5) Business Days after reporting such discrepancy, but in the absence of a
reconciliation, distributions on the related Remittance Date shall be made
consistent with the information calculated by the Servicer, the Servicer and the
Backup Servicer shall attempt to reconcile such discrepancy prior to the next
Remittance Date, and the Servicer shall promptly report to the Lender regarding
the progress, if any, which shall have been made in reconciling such
discrepancy.  If the Backup Servicer and the Servicer are unable to
reconcile such discrepancy with respect to such Monthly Remittance Report by the
next Remittance Date that falls in April, July, October or January, the Servicer
shall cause independent accountants acceptable to the Lender, at the Servicer’s
expense, to examine such Monthly Remittance Report and attempt to reconcile such
discrepancy at the earliest possible date (and the Servicer shall promptly
provide the Lender with a report regarding such event).  The effect,
if any, of such reconciliation shall be reflected in the Monthly Remittance
Report for the next succeeding Remittance Date.

         

        Other
than as specifically set forth in this Agreement, the Backup Servicer shall have
no obligation to supervise, verify, monitor or administer the performance of the
Servicer and shall have no liability for any action taken or omitted by the
Servicer.

         

        The
Backup Servicer may allow a subservicer to perform any and all of its duties and
responsibilities hereunder, including but not limited to its duties as successor
Servicer hereunder, should the Backup Servicer become the successor Servicer
pursuant to the terms of this Agreement; provided, however, that the
Backup Servicer shall remain liable for the performance of all of its duties and
obligations hereunder to the same extent as if no such subservicing had
occurred.

         

        In no
event shall the Backup Servicer (either prior to or after
its  appointment hereunder as Servicer) be responsible or liable for
any  failure or delay in the performance of its obligations
hereunder  arising out of or caused by, directly or indirectly, forces
beyond its control, including without limitation, acts of terrorism, civil or
military disturbances, nuclear or natural catastrophes or acts of
God.

         

        SECTION
6.14 Additional
Remedies of Lender Upon Event of Default.  During the
continuance of any Event of Default, the Lender, in addition to the rights
specified in Section 7.01,
shall have the right to take all actions now or hereafter existing at law, in
equity or by statute to protect its interests and enforce its rights and
remedies (including the institution and prosecution of all judicial,
administrative and other proceedings and the filings of proofs of claim and debt
in connection therewith).  Except as otherwise expressly provided in
this Agreement, no remedy provided for by this Agreement shall be exclusive of
any other remedy, each and every remedy shall be cumulative and in addition to
any other remedy, and no delay or omission to exercise any right or remedy shall
impair any such right or remedy or shall be deemed to be a waiver of any Event
of Default.

         

        SECTION
6.15 Waiver of
Defaults.  The Lender may waive any default by the Servicer in
the performance of its obligations hereunder and its
consequences.  Upon any such waiver of a past default, such default
shall cease to exist, and any Event of Default arising therefrom shall be deemed
to have been remedied for every purpose of this Agreement.  No such
waiver shall be effective unless it shall be in writing and signed by the Lender
and no such waiver shall extend to any subsequent or other default or impair any
right consequent thereon except to the extent expressly so waived.

         

        SECTION
6.16 Maintenance
of Certain Insurance.  On the date hereof the Servicer shall
obtain, and at all times thereafter during the term of its service as Servicer
the Servicer shall maintain, in force an “errors and omissions” insurance policy
in an amount not less than $1,000,000 naming the Lender as loss payee and with
an insurance company reasonably acceptable to the Lender.

         

        
          
            
            

          

          
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        The
Servicer shall deliver a copy of the insurance policy required under this
Section 6.16 to the Lender on the date hereof together with a certification from
the applicable insurance company that such policy is in force on the date
hereof.

         

        The
Servicer shall prepare and present, on behalf of itself and the Lender, claims
under any such policy in a timely fashion in accordance with the terms of such
policy, and upon, the filing of any claim on any policy described in this
Section, the Servicer shall promptly notify the Lender of such
claim.

         

        SECTION
6.17 Segregation
of Collections.  The Servicer shall not commingle funds
constituting Collections with respect to any Pledged Receivable with any other
funds of the Servicer; provided, that such
commingling may occur in the Lockbox Account so long as the Lockbox
Intercreditor Agreement is in full force and effect.

         

        SECTION
6.18 UCC Matters;
Protection and Perfection of Pledged Assets.  The Borrower will
not change the jurisdiction of its formation, make any change to its corporate
name or use any tradenames, fictitious names, assumed names, “doing business as”
names or other names (other than those listed on Schedule II
hereto, as such schedule may be revised from time to time to reflect name
changes and name usage permitted under the terms of this Section 6.18
after compliance with all terms and conditions of this Section 6.18
related thereto) unless, prior to the effective date of any such jurisdiction
change, name change or use, the Borrower notifies the Collateral Agent of such
change in writing and delivers to the Collateral Agent such executed financing
statements as the Collateral Agent may request to reflect such jurisdiction,
name change or use, together with such other documents and instruments as the
Collateral Agent may request in connection therewith.  The Borrower
will not change the location of its chief executive office or the location of
its records regarding the Pledged Receivables unless, prior to the effective
date of any such change of location, the Borrower notifies the Collateral Agent
of such change of location in writing and delivers to the Collateral Agent such
executed financing statements as the Collateral Agent may reasonably request to
reflect such change of location, together with such Opinions of Counsel,
documents and instruments as the Collateral Agent may request in connection
therewith.  The Borrower agrees that from time to time, at its
expense, it will promptly execute and deliver all further instruments and
documents, and take all further action that the Collateral Agent may reasonably
request in order to perfect, protect or more fully evidence the Collateral
Agent’s interest in the Pledged Assets acquired hereunder, or to enable the
Collateral Agent to exercise or enforce any of its respective rights
hereunder.  Without limiting the generality of the foregoing, the
Borrower will, upon the request of the Collateral
Agent:  (i) execute (if necessary) and file such financing or
continuation statements, or amendments thereto or assignments thereof, and such
other instruments or notices, as may be necessary or appropriate or as the
Collateral Agent may request, and (ii) mark its master data processing
records evidencing such Pledged Receivables with a legend acceptable to the
Collateral Agent, evidencing that the Collateral Agent has acquired an interest
therein as provided in this Agreement.  The Collateral Agent shall be
entitled to conclusively rely on the filings or registrations made by or on
behalf of the Borrower without any independent investigation and the Borrower’s
obligation to make such filings as evidence that such filings have been
made.  The Borrower hereby authorizes the Collateral Agent to file one
or more financing or continuation statements, and amendments thereto and
assignments thereof, relative to all or any of the Pledged Receivables and the
Other Conveyed Property and the Related Security related thereto and the
proceeds of the foregoing now existing or hereafter arising, without the
signature of the Borrower where permitted by law.  The Borrower hereby
ratifies and authorizes the filing by the Collateral Agent of any such financing
statement made prior to the date hereof.  A carbon, photographic or
other reproduction of this Agreement or any financing statement covering the
Pledged Receivables, or any part thereof, shall be sufficient as a financing
statement.  The Borrower shall, upon the request of the Collateral
Agent at any time after the occurrence of an Event of Default and at the
Borrower’s expense, notify the Obligors obligated to pay any Pledged
Receivables, or any of them, of the security interest of the Collateral Agent in
the Pledged Assets.  If the Borrower fails to perform any of its
agreements or obligations under this Section 6.18,
the Collateral Agent may (but shall not be required to) itself perform, or cause
performance of, such agreement or obligation, and the expenses of the Collateral
Agent incurred in connection therewith shall be payable by the Borrower upon the
Collateral Agent’s demand therefor.  For purposes of enabling the
Collateral Agent to exercise its rights described in the preceding sentence and
elsewhere in this Article VI, the
Borrower hereby authorizes the Collateral Agent and its successors and assigns
to take any and all steps in the Borrower’s name and on behalf of the Borrower
necessary or desirable, in the determination of the Collateral Agent, to collect
all amounts due under any and all Pledged Receivables, including, without
limitation, endorsing the Borrower’s name on checks and other instruments
representing Collections with respect to any Pledged Receivable and enforcing
such Pledged Receivables and the related Contracts and, if any, the related
guarantees.

         

        
          
            
            

          

          
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        SECTION
6.19 Servicer
Advances.  The Servicer may, in its sole discretion, make an
advance in respect of any payment due on a Pledged Receivable (other than a
Defaulted Receivable) to the extent such payment has not been received by the
Servicer as of its due date and the Servicer reasonably expects such payment
will be ultimately recoverable
(a “Servicer
Advance”).  The Servicer shall deposit into the Collection
Account in immediately available funds the aggregate of all Servicer Advances to
be made during a Fee Period on or prior to the Business Day immediately
preceding the related Remittance Date.  The Servicer shall be entitled
to reimbursement for such Servicer Advances from monies in the Collection
Account as provided in Section 2.04(c)
hereof.

         

        SECTION
6.20 Repurchase
of Receivables Upon Breach of Covenant or Representation and Warranty by
Servicer.  The Borrower or the Servicer, as the case may be,
shall inform the other parties to this Agreement and the Initial Qualifying Swap
Counterparty promptly, in writing, upon the discovery of any breach of the
Servicer’s representations, warranties and/or covenants pursuant to Section 4.02,
Section 6.05 or
Article V;
provided, however, that the
failure to provide any such notice shall not diminish, in any manner whatsoever,
any obligation of the Servicer hereunder to repurchase any Pledged
Receivable.  Unless such breach shall have been cured by the last day
of the first full calendar month following the discovery by or notice to the
Servicer of such breach (and provided that a Borrowing Base Deficiency exists on
such last day), the Servicer (if LEAF Financial or an Affiliate thereof) shall
have an obligation, and the Borrower shall and the Collateral Agent may, enforce
such obligation of the Servicer (if LEAF Financial or an Affiliate thereof), to
repurchase any Pledged Receivable materially and adversely affected by such
breach.  The Borrower shall notify the Collateral Agent promptly, in
writing, of any failure by the Servicer to so repurchase any such Pledged
Receivable.  In consideration of the repurchase of such Pledged
Receivable, the Servicer shall remit funds in an amount equal to the Release
Price for such Pledged Receivable to the Collection Account on the date of such
repurchase.  The obligations of the Servicer under this Section 6.20 are
in addition to, and in no way limit, any obligations of the Servicer in its
individual capacity under the Purchase and Sale Agreement.  It is
understood and agreed that the obligation of the Servicer to purchase any
Receivables is not intended to, and shall not, constitute a guaranty of the
collectibility or payment of any Receivable which is not collected, not paid or
uncollectible on account of the insolvency, bankruptcy, or financial inability
to pay of the related Obligor.

         

        SECTION
6.21 Compliance
with Applicable Law.  The Servicer and the Borrower shall at
all times comply in all material respects with all requirements of applicable
federal, state and local laws, and regulations thereunder (including, without
limitation, usury laws, the Federal Truth-in-Lending Act, the Equal Credit
Opportunity Act, the Fair Credit Billing Act, the Fair Credit Reporting Act, the
Fair Debt Collection Practices Act, the Federal Trade Commission Act, the
Magnuson-Moss Warranty Act, the Federal Reserve Board’s Regulations “B” and “Z”,
the Soldiers’ and Sailors’ Civil Relief Act of 1940 and state adaptations of the
National Consumer Act and of the Uniform Consumer Credit Code and all other
consumer credit laws and equal credit opportunity and disclosure laws) in the
conduct of its business.

         

        SECTION
6.22 Receipt of
Certificates of Title.  Any Receivable with respect to which
the Obligor Collateral includes a Vehicle and for which the Servicer shall not
have (i) received a Certificate of Title satisfying the Titling
Requirements and (ii) delivered such Certificate of Title to the Custodian
within 90 days of the first day of inclusion of such Pledged Receivable in
the calculation of the Eligible Receivables Balance, shall no longer be deemed
to be an Eligible Receivable and, therefore, shall no longer be included in the
calculation of the Eligible Receivables Balance.  In the case of any
Receivable excluded from the calculation of the Eligible Receivables Balance
pursuant to the previous sentence, the Receivable so excluded from the
calculation of the Eligible Receivables Balance may at a later time be included
in the calculation of the Eligible Receivables Balance, provided, that
(i) the Custodian shall have received the Certificate of Title described
above with respect to such Receivable from the applicable Registrar of Titles
and delivered such Certificate of Title to the Custodian and (ii) such
Receivable is otherwise an Eligible Receivable at such time.

         

        SECTION
6.23 Lender’s
Bank Limitation of Liability.  a) The Lender’s Bank undertakes
to perform only such duties and obligations as are specifically set forth in
this Agreement, it being expressly understood by the parties hereto that there
are no implied duties or obligations under this Agreement.  Neither
the Lender’s Bank nor any of its officers, directors, employees or agents shall
be liable, directly or indirectly, for any damages or expenses arising out of
the services performed under this Agreement other than damages which result from
the gross negligence or willful misconduct of it or them.  In no event
will the Lender’s Bank or any of its officers, directors, employees or agents be
liable for any consequential, indirect or special damages.

         

        
          
            
            

          

          
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(b)  The Lender’s Bank shall not be liable for any error of judgment,
or for any act done or step taken or omitted by it, in good faith, or for any
mistakes of fact or law, or for anything which it may do or refrain from doing
in connection herewith.

         

        (c) The
Lender’s Bank may rely on and shall be protected in acting upon any certificate,
instrument, opinion, notice, letter, telegram or other document delivered to it
by any other Person and which in good faith it believes to be genuine and which
has been signed by the proper party or parties.  The Lender’s Bank may
rely on and shall be protected in acting upon the written instructions of any
designated officer of the Borrower, the Servicer or the Lender.

         

        (d) The
Lender’s Bank may consult with counsel reasonably satisfactory to it and the
opinion of such counsel shall be full and complete authorization and protection
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the opinion of such counsel.

         

        (e) The
Lender’s Bank shall not be required to expend or risk its own funds or otherwise
incur financial liability in the performance of any of its duties hereunder, or
in the exercise of its rights or powers, if the Lender’s Bank believes that
repayment of such funds (repaid in accordance with the terms of this Agreement)
or adequate indemnity against such risk or liability is not reasonably assured
to it.

         

        (f) The
Lender’s Bank shall not be deemed to be a fiduciary of any party
hereto.

         

        (g) The
parties hereto agree that in no event will the Lender’s Bank be liable for
special, indirect or consequential damages.

         

        
          	
                   
      

                	
                  ARTICLE
      VII.

                

        

         

        
          	
                   
      

                	
                  EVENTS
      OF DEFAULT

                

        

         

        SECTION
7.01 Events of
Default.  If any of the following events (“Events of Default”)
shall occur:

         

        (a) the
occurrence of any Bankruptcy Event with respect to the Borrower, Owner, Resource
America, the Originator or the Servicer; or

         

        (b) any
representation or warranty made or deemed to be made by the Borrower or the
Servicer (or any of its officers) under or in connection with this Agreement (or
any remittance report or other information or report delivered pursuant hereto)
or any other Transaction Document shall prove to be false or incorrect in any
respect and shall remain false or incorrect for a period fifteen (15) Business
Days after the Servicer or the Borrower become aware, or are notified by the
Lender, the Custodian or any other Person, that such representation or warranty
is false or incorrect; provided, however, that if any
breach described above is cured by the repurchase of Receivables pursuant to
Article VI
of the Purchase and Sale Agreement or by a repayment hereunder, or repurchase
pursuant to Sections 4.03 or
6.20 hereof,
such breach shall cease to constitute an Event of Default; or

         

        (c) (i) the
Borrower or the Servicer shall fail to perform or observe any term, covenant or
agreement hereunder or under any other Transaction Document (other than
described in clause (ii) below) in any material respect and such failure
remains unremedied for fifteen (15) Business Days or (ii) either the
Servicer or the Borrower shall fail to make any payment or deposit to be made by
it when due hereunder or under any other Transaction Document and such failure
remains unremedied for two (2) Business Days; or

         

        (d) the
Borrower, Owner, the
Originator, Resource America or the Servicer shall fail to pay (and such
failure remains unremedied for two (2) Business Days) any principal of or
premium or interest on any Debt in an amount in excess of $10,000,000, when the
same becomes due and payable (whether by scheduled maturity, required
prepayment, acceleration, demand or otherwise); or any other default under any
agreement or instrument relating to any Debt of the Borrower, the Owner or the Servicer or
any other event, shall occur if the effect of such default or event is to
accelerate, or to permit the acceleration of, the maturity of such Debt; or any
such Debt shall be declared
to be due and payable or required to be prepaid (other than by a regularly
scheduled required prepayment) prior to the stated maturity thereof;
or

         

        
          
            
            

          

          
            63

            
              

            

          

          
            
            

          

        

        (e) the
Originator, the Borrower or any of their respective subsidiaries shall have
suffered any material adverse change to its business, financial condition or any
other condition which, in Lender’s sole discretion, constitutes a material
impairment of the Originator or the Borrower’s ability to perform its
Obligations; or

         

        (f) (i) the
Collateral Agent shall at any time fail to have a valid, perfected, first
priority security interest in any of the Pledged Assets (other than Equipment
which has a value of less than (x) $25,000 if such Equipment is leased
under Dollar Purchase Option Contracts or (y) $50,000 if such Equipment is
leased under FMV Contracts) or (ii) any purchase by the Borrower of a
Receivable and the Collections, Related Security and Other Conveyed Property
with respect thereto under the Purchase and Sale Agreement shall, for any
reason, cease to create in favor of the Borrower a perfected ownership interest
in such Receivable and the Collections, Related Security and the Other Conveyed
Property with respect thereto; provided, however, that if an
event described in the foregoing clause (i) or (ii) is cured by the
repurchase of Receivables pursuant to Article VI of
the Purchase and Sale Agreement or by a repayment hereunder or repurchase
pursuant to Sections 4.03 or
6.20 hereof,
within five Business Days, such event shall cease to constitute an Event of
Default; or

         

        (g) the
Borrower or the Servicer shall have suffered any material adverse change to its
financial condition or operations which would affect the collectibility of the
Pledged Receivables or the Borrower’s or the Servicer’s ability to conduct its
business or fulfill its obligations hereunder or under any other Transaction
Document; or

         

        (h) the
Servicer’s or the Borrower’s activities are terminated for any reason, including
any termination thereof by a regulatory, tax or accounting body; or

         

        (i) the
occurrence of a Change of Control; or

         

        (j) the
Purchase and Sale Agreement or any other Transaction Document or any material
provision of any of them shall cease to be in full force and effect and
enforceable in accordance with its terms, or the Servicer, the Borrower, or any
Affiliate of the Servicer or the Borrower shall so assert in writing;
or

         

        (k) the
occurrence of a Servicer Default; or

         

        (l) (i) the
Facility Amount exceeds the lesser of (x) the Borrowing Limit and such
event shall remain unremedied for one Business Day or (y) the Borrowing
Base and such event shall remain unremedied for two Business Days; (ii) the
aggregate Facility Amount hereunder, calculated solely with respect to Loans
made with respect to Pool A Receivables, exceeds the Pool A Borrowing
Base and such event shall remain unremedied for two Business Days or
(iii) the aggregate Facility Amount hereunder, calculated solely with
respect to Loans made with respect to Pool B Receivables, exceeds the
Pool B Borrowing Base and such event shall remain unremedied for two
Business Days; or

         

        (m) the
auditor’s opinion accompanying the audited annual financial statements of the
Servicer or the Borrower is qualified in any manner; or

         

        (n) (i) any
Qualifying Interest Rate Swap shall cease to be in full force and effect,
(ii) the Borrower or the Servicer fail to comply with any hedging
requirement hereunder or (iii) the counterparty under any Qualifying
Interest Rate Swap or former or purported Qualifying Interest Rate Swap fails to
qualify as a Qualifying Swap Counterparty and does not post cash collateral in a
manner satisfactory to the Lender is not replaced by a Qualifying Swap
Counterparty within 45 days of such counterparty’s failure to so qualify,
(iv) the occurrence of any default by the Borrower or Servicer in the
observance or performance of any of the terms or provisions of any Qualifying
Interest Rate Swap or (v) any interest rate swap agreement represented by
the Borrower or the Servicer to be a Qualifying Interest Rate Swap shall fail to
be, or cease to be, a Qualifying Interest Rate Swap; or

         

        (o) Resource
America or the Owner
shall, at any time, permit its respective Tangible Net Worth
to be less than the applicable
Minimum Tangible Net Worth; or

         

        
          
            
            

          

          
            64

            
              

            

          

          
            
            

          

        

        (p) either
(i) the provisions of the Transaction Documents relating to the Backup
Servicer or its duties under any of the Transaction Documents cease to be in
full force and effect and enforceable in accordance with their terms, or the
Backup Servicer shall so assert in writing, (ii) Lyon Financial Services,
Inc. or any successor Backup Servicer resigns, is removed by the Lender, or
otherwise ceases to act as the Backup Servicer, and such Backup Servicer is not
replaced by a new Backup Servicer satisfactory to the Lender within 45 days of
such resignation, removal or other event;

         

        then the
Lender may, by notice to the Borrower and each Qualifying Swap Counterparty,
declare the Program Termination Date to have occurred; provided, that, in
the case of any event described in Section 7.01(a)
above, the Program Termination Date shall be deemed to have occurred
automatically upon the occurrence of such event.  Upon any such
declaration or automatic occurrence, (i) the Borrower shall cease
purchasing Receivables from Originator under the Purchase and Sale Agreement,
(ii) at the option of the Lender in its sole discretion, the Lender may
declare the Loans made to the Borrower hereunder and all interest and all Fees
accrued on such Loans and any other Obligations to be immediately due and
payable (and the Borrower shall pay such Loans and all such amounts and
Obligations immediately), (iii) the Lender, in its sole discretion, may
direct the Obligors to make all payments under the Pledged Receivables directly
to the Backup Servicer, the Lender or any lockbox or account established by any
of such parties.  Any Collections received in any such account (or
received directly by the Lender) shall be applied to the Obligations in
accordance with the priority of payments set forth in Section
2.04(c).  In addition, upon any such declaration or upon any
such automatic occurrence, the Lender and the Collateral Agent shall have, in
addition to all other rights and remedies under this Agreement or otherwise, all
other rights and remedies provided under the UCC of the applicable jurisdiction
and other applicable laws, which rights shall be cumulative.  If any
Event of Default shall have occurred, the Interest Rate shall be increased to
the Default Funding Rate, effective as of the date of the occurrence of such
Event of Default, and shall remain at the Default Funding Rate.

         

        SECTION
7.02 Additional
Remedies of the Lender.  a) If, (i) upon the Lender’s
declaration that the Loans made to the Borrower hereunder are immediately due
and payable pursuant to Section 7.01 or
(ii) on the Facility Maturity Date, the aggregate outstanding principal
amount of the Loans, all accrued Fees and interest and any other Obligations are
not immediately paid in full, then the Collateral Agent, in addition to all
other rights specified hereunder, shall have the right to immediately sell in a
commercially reasonable manner, in a recognized market (if one exists) at such
price or prices as the Collateral Agent may reasonably deem satisfactory, any or
all Pledged Assets and shall apply the proceeds thereof to the Obligations in
accordance with the priority of payments set forth in Section
2.04(c).

         

        (b) The
parties recognize that it may not be possible to sell all of the Pledged Assets
on a particular Business Day, or in a transaction with the same purchaser, or in
the same manner because the market for such Pledged Assets may not be
liquid.  Accordingly, the Collateral Agent may elect, in its sole
discretion, the time and manner of liquidating any Pledged Assets, and nothing
contained herein shall obligate the Collateral Agent to liquidate any Pledged
Assets on the date the Lender declares the Loans made to the Borrower hereunder
to be immediately due and payable pursuant to Section 7.01 or
to liquidate all Pledged Assets in the same manner or on the same Business
Day.

         

        (c) Any
amounts received from any sale or liquidation of the Pledged Assets pursuant to
this Section 7.02 in
excess of the Obligations will be returned to the Borrower, its successors or
assigns, or to whosoever may be lawfully entitled to receive the same, or as a
court of competent jurisdiction may otherwise direct.

         

        (d) Each
of the Lender, Collateral Agent and the Initial Qualifying Swap Counterparty
shall have, in addition to all the rights and remedies provided herein and
provided by applicable federal, state, foreign, and local laws (including,
without limitation, the rights and remedies of a secured party under the Uniform
Commercial Code of any applicable state, to the extent that the Uniform
Commercial Code is applicable, and the right to offset any mutual debt and
claim), all rights and remedies available to such Person at law, in equity or
under any other agreement between such Person and the Borrower.

         

        (e) Except
as otherwise expressly provided in this Agreement, no remedy provided for by
this Agreement shall be exclusive of any other remedy, each and every remedy
shall be cumulative and in addition to any other remedy, and no delay or
omission to exercise any right or remedy shall impair any such right or remedy
or shall be deemed to be a waiver of any Program Termination Event or Event of
Default.

         

        
          
            
            

          

          
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ARTICLE
VIII.

        

        

        INDEMNIFICATION

         

        SECTION
8.01 Indemnities
by the Borrower.  Without limiting any other rights which the
Lender, the Collateral Agent, the Backup Servicer (whether in its capacity as
Backup Servicer or successor Servicer), the Lender’s Bank, the Custodian, the
Initial Qualifying Swap Counterparty or any of their respective Affiliates may
have hereunder or under applicable law, the Borrower hereby agrees to indemnify
the Lender, the Collateral Agent, the Custodian, the Backup Servicer, the
Lender’s Bank, the Initial Qualifying Swap Counterparty and each of their
respective Affiliates (each, an “Indemnified Party”
for purposes of this Article VIII)
from and against any and all damages, losses, claims, liabilities and related
costs and expenses, including reasonable attorneys’ fees and disbursements (all
of the foregoing being collectively referred to as “Indemnified
Amounts”), awarded against or incurred by any of them arising out of or
as a result of this Agreement or in respect of any Pledged Assets, excluding,
however, (A) Indemnified Amounts to the extent resulting solely from gross
negligence, bad faith or willful misconduct on the part of an Indemnified Party,
(B) taxes (including interest and penalties imposed thereon) imposed by the
jurisdiction in which such Indemnified Party’s principal executive office is
located, on or measured by the overall net income of such Indemnified Party or
(C) Indemnified Amounts to the extent that they are or result from lost profits
(other than principal, interest and Fees with respect to the
Loans).  Without limiting the foregoing, the Borrower shall indemnify
each Indemnified Party for Indemnified Amounts relating to or resulting from any
of the following (to the extent not resulting solely from gross negligence, bad
faith or willful misconduct on the part of an Indemnified Party):

         

        
          	
                   
      

                	
                  (i)

                	
                  any
      Pledged Receivable treated as or represented by the Borrower to be an
      Eligible Receivable which is not at the applicable time an Eligible
      Receivable;

                

        

         

        
          	
                   
      

                	
                  (ii)

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

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      failure by the Borrower to comply with any term, provision or covenant
      contained in this Agreement or any agreement executed in connection with
      this Agreement, or with any applicable law, rule or regulation with
      respect to any Pledged Assets, or the nonconformity of any Pledged Assets
      with any such applicable law, rule or
  regulation;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  the
      failure to vest and maintain vested in the Collateral Agent or to transfer
      to the Collateral Agent a first priority perfected security interest in
      the Receivables which are, or are purported to be, Pledged Receivables,
      together with all related Other Conveyed Property, Collections, Related
      Security and other Pledged Assets related thereto (including, without
      limitation, the Borrower’s interest in and to any and all Obligor
      Collateral with respect to such Receivables), free and clear of any
      Adverse Claim whether existing at the time of the related Borrowing or at
      any time thereafter;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      failure to maintain, as of the close of business on each Business Day
      prior to the Collection Date, a Facility Amount which is less than or
      equal to the lesser of (x) the Borrowing Limit on such Business Day
      and (y) the Borrowing Base on such Business
  Day;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  the
      failure to maintain, as of the close of business on each Business Day
      prior to the Collection Date, a Facility Amount, calculated solely with
      respect to Loans secured by Pool A Receivables, which is less than or
      equal to the Pool A Borrowing
Base;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  the
      failure to maintain, as of the close of business on each Business Day
      prior to the Collection Date, a Facility Amount, calculated solely with
      respect to Loans secured by Pool B Receivables, which is less than or
      equal to the Pool B Borrowing Base;

                

        

         

         

        
          
            
            

          

          
            66

            
              

            

          

          
            
            

          

        

         

        
          	
                   
      

                	
                  (viii)

                	
                  the
      failure to file, or any delay in filing, financing statements or other
      similar instruments or documents under the UCC of any applicable
      jurisdiction or other applicable laws with respect to any Receivables
      which are, or are purported to be, Pledged Receivables or the other
      Pledged Assets related thereto, whether at the time of any Borrowing or at
      any subsequent time;

                

        

         

        
          	
                   
      

                	
                  (ix)

                	
                  any
      dispute, claim, offset or defense (other than the discharge in bankruptcy
      of an Obligor) to the payment of any Receivable which is, or is purported
      to be, a Pledged Receivable (including, without limitation, a defense
      based on such Receivable (or the Contract evidencing such Receivable) not
      being a legal, valid and binding obligation of such Obligor enforceable
      against it in accordance with its
terms);

                

        

         

        
          	
                   
      

                	
                  (x)

                	
                  any
      failure of the Borrower to perform its duties or obligations in accordance
      with the provisions of this Agreement or any other Transaction
      Document;

                

        

         

        
          	
                   
      

                	
                  (xi)

                	
                  the
      failure of the Borrower to pay when due any taxes payable in connection
      with the Pledged Receivables or the Pledged Assets related
      thereto;

                

        

         

        
          	
                   
      

                	
                  (xii)

                	
                  any
      repayment by the Lender of any amount previously distributed in payment of
      Loans or payment of interest or Fees or any other amount due hereunder, in
      each case which amount the Lender believes in good faith is required to be
      repaid;

                

        

         

        
          	
                   
      

                	
                  (xiii)

                	
                  the
      commingling by the Borrower of Collections of Pledged Receivables at any
      time with other funds;

                

        

         

        
          	
                   
      

                	
                  (xiv)

                	
                  any
      investigation, litigation or proceeding related to this Agreement or the
      use of proceeds of Loans or the Pledged
Assets;

                

        

         

        
          	
                   
      

                	
                  (xv)

                	
                  any
      failure by the Borrower to give reasonably equivalent value to Originator
      in consideration for the transfer by Originator to the Borrower of any
      Receivable or any attempt by any Person to void or otherwise avoid any
      such transfer under any statutory provision or common law or equitable
      action, including, without limitation, any provision of the Bankruptcy
      Code;

                

        

         

        
          	
                   
      

                	
                  (xvi)

                	
                  [Reserved];

                

        

         

        
          	
                   
      

                	
                  (xvii)

                	
                  any
      failure of the Borrower or any of its agents or representatives to remit
      to the Collection Account, Collections of Pledged Receivables remitted to
      the Borrower or any such agent or
  representative;

                

        

         

        
          	
                   
      

                	
                  (xviii)

                	
                  any
      failure on the part of the Borrower duly to observe or perform in any
      material respect any covenant or agreement under any Qualifying Interest
      Rate Swap; and/or

                

        

         

        
          	
                   
      

                	
                  (xix)

                	
                  any
      Contract related to any Pledged Receivable being rejected by an Obligor
      under Section 365 of the Bankruptcy Code in the event that a
      Bankruptcy Event has occurred with respect to such
  Obligor.

                

        

         

        Any
amounts subject to the indemnification provisions of this Section 8.01
shall be paid by the Borrower to the Lender on behalf of the applicable
Indemnified Party within two (2) Business Days following the Lender’s written
demand therefor on behalf of the applicable Indemnified Party (and the Lender
shall pay such amounts to the applicable Indemnified Party promptly after the
receipt by the Lender of such amounts).  The Lender, on behalf of any
Indemnified Party making a request for indemnification under this Section 8.01,
shall submit to the Borrower a certificate setting forth in reasonable detail
the basis for and the computations of the Indemnified Amounts with respect to
which such indemnification is requested, which certificate shall be conclusive
absent demonstrable error.

         

        
          
            
            

          

          
            67

            
              

            

          

          
            
            

          

        

        If the
Borrower has made any payments in respect of Indemnified Amounts to the Lender,
on behalf of an Indemnified Party pursuant to this Section 8.01 and
such Indemnified Party thereafter collects any of such amounts from others, such
Indemnified Party will promptly repay such amounts collected to the Borrower,
without interest.

         

        SECTION
8.02  Indemnities by
Servicer.  a) Without limiting any other rights which any
Indemnified Party may have hereunder or under applicable law, the Servicer (if
LEAF Financial or one of its Affiliates) hereby agrees to indemnify each
Indemnified Party from and against any and all damages, losses, claims,
liabilities and related costs and expenses (including reasonable attorneys’ fees
and disbursements) (all of the foregoing being collectively referred to as
“Servicer Indemnified
Amounts”) suffered or sustained by any Indemnified Party as a consequence
of any of the following, excluding, however, Servicer Indemnified Amounts
resulting solely from (A) any gross negligence, bad faith or willful misconduct
of any Indemnified Party claiming indemnification hereunder, (B) taxes
(including interest and penalties imposed thereon) imposed by the jurisdiction
in which such Indemnified Party’s principal executive office is located, on or
measured by the overall net income of such Indemnified Party; (C) Indemnified
Amounts to the extent that they are or result from lost profits (other than
principal, interest and Fees with respect to the Loans); and (D) Indemnified
Amounts to the extent the same includes losses that arise solely due to
Receivables being uncollectible on account of the insolvency, bankruptcy or lack
of creditworthiness of the related Obligor or would constitute recourse to
Servicer for such losses:

         

        
          	
                   
      

                	
                  (i)

                	
                  the
      inclusion, in any computations made by it in connection with any Borrowing
      Base Certificate or Monthly Remittance Report or other report prepared by
      it hereunder, of any Pledged Receivables which were not Eligible
      Receivables as of the date of any such
  computation;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  reliance
      on any representation or warranty made by the Servicer (if LEAF Financial
      or one of its Affiliates) or any of its officers under or in connection
      with this Agreement, which shall have been false or incorrect in any
      material respect when made  or
  delivered;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  the
      failure by the Servicer (if LEAF Financial or any of its Affiliates) to
      comply with (A) any term, provision or covenant contained in this
      Agreement, or any agreement executed in connection with this Agreement, or
      (B) any applicable law, rule or regulation applicable to it with
      respect to any Pledged Assets;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  any
      action or inaction by the Servicer (if LEAF Financial or one of its
      Affiliates) that causes the Collateral Agent not to have a first priority
      perfected security interest in the Receivables that are, or are purported
      to be, Pledged Receivables, together with all related Other Conveyed
      Property, Collections, Related Security and other Pledged Assets related
      thereto (including without limitation, the Borrower’s interest in and to
      any and all Obligor Collateral with respect to such Receivables), free and
      clear of any Adverse Claim whether existing at the time of the related
      Borrowing or any time thereafter;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  the
      commingling by the Servicer (if LEAF Financial or one of its Affiliates)
      of the Collections of Pledged Receivables at any time with any other
      funds;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  any
      failure of the Servicer (if LEAF Financial or one of its Affiliates) or
      any of its agents or representatives (including, without limitation,
      agents, representatives and employees of the Servicer acting pursuant to
      authority granted under Section 6.01
      hereof) to remit to Collection Account, Collections of Pledged Receivables
      remitted to the Servicer or any such agent or
    representative;

                

        

         

        
          	
                   
      

                	
                  (vii)

                	
                  the
      failure by the Servicer (if LEAF Financial or any of its Affiliates) to
      perform any of its duties or obligations in accordance with the provisions
      of this Agreement or errors or omissions related to such duties;
      and/or

                

        

         

        
          	
                   
      

                	
                  (viii)

                	
                  notwithstanding
      whether any Pledged Receivable shall have been repurchased by the Servicer
      pursuant to Section 6.20,
      any of the events or facts giving rise to a breach of any of the
      Servicer’s representations, warranties, agreements and/or covenants set
      forth in Article V
      or Article VI.

                

        

         

        
          
            
            

          

          
            68

            
              

            

          

          
            
            

          

        

        (b) Any
Servicer Indemnified Amounts shall be paid by the Servicer (if LEAF Financial or
one of its Affiliates) to the Lender, for the benefit of the applicable
Indemnified Party, within two (2) Business Days following receipt by the
Servicer of the Lender’s written demand therefor (and the Lender shall pay such
amounts to the applicable Indemnified Party promptly after the receipt by the
Lender of such amounts).

         

        (c) If
the Servicer has made any indemnity payments to the Lender, on behalf of an
Indemnified Party pursuant to this Section 8.02 and
such Indemnified Party thereafter collects any of such amounts from others, such
Indemnified Party will promptly repay such amounts collected to the Servicer,
without interest.

         

        Each
applicable Indemnified Party shall deliver to the indemnifying party under Section 8.01 and
Section 8.02,
within a reasonable time after such Indemnified Party’s receipt thereof, copies
of all notices and documents (including court papers) received by such
Indemnified Party relating to the claim giving rise to the Indemnified
Amounts.

         

        
          	
                   
      

                	
                  ARTICLE
      IX.

                

        

         

         

        
          	
                   
      

                	
                  MISCELLANEOUS

                

        

         

        SECTION
9.01 Amendments
and Waivers.  a) Except as provided in Section 9.01(b),
no amendment or modification of any provision of this Agreement shall be
effective without the written agreement of the Borrower, the Servicer, the
Lender and, to the extent any of their rights or obligations hereunder are
adversely affected thereby, the Backup Servicer, the Custodian, the Lender’s
Bank, and/or each Qualifying Swap Counterparty, and no termination or waiver of
any provision of this Agreement or consent to any departure therefrom by the
Borrower or the Servicer shall be effective without the written concurrence of
the Backup Servicer and the Lender.  Any waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

         

        (b) Notwithstanding
the provisions of Section 9.01(a),
in the event that there is more than one Lender, the written consent of each
Lender shall be required for any amendment, modification or waiver
(i) reducing any outstanding Loans, or the interest thereon,
(ii) postponing any date for any payment of any Loan, or the interest
thereon, (iii) modifying the provisions of this Section 9.01, or
(iv) increasing the Borrowing Base or the Borrowing Limit.

         

        SECTION
9.02 Notices,
Etc.  All notices and other communications provided for
hereunder shall, unless otherwise stated herein, be in writing (including telex
communication, communication by facsimile copy or electronic mail) and mailed,
telexed, transmitted or delivered, as to each party hereto, at its address set
forth on Schedule
VI hereto or specified in such party’s Assignment and Acceptance or at
such other address (including, without limitation, an electronic mail address)
as shall be designated by such party in a written notice to the other parties
hereto.  All such notices and communications shall be effective, upon
receipt, or in the case of  notice by facsimile copy or electronic mail,
when verbal communication of receipt is obtained, except that notices and
communications pursuant to Article II shall
not be effective until received.

         

        SECTION
9.03 No Waiver;
Remedies.  No failure on the part of the Lender to exercise,
and no delay in exercising, any right hereunder shall operate as a waiver
thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.  The remedies herein provided are cumulative and not exclusive
of any remedies provided by law.

         

        SECTION
9.04 Binding
Effect; Assignability; Multiple Lenders.  a) This Agreement
shall be binding upon and inure to the benefit of the Borrower, the Servicer,
the Lender, the Backup Servicer, the Custodian, the Lender’s Bank and their
respective successors and permitted assigns.  This Agreement and the
Lender’s rights and obligations hereunder and interest herein shall be
assignable in whole or in part (including by way of the sale of participation
interests
therein) by the Lender and its successors and assigns.  None of the
Borrower, the Servicer or the Backup Servicer may assign any of its rights and
obligations hereunder or any interest herein without the prior written

         

        
          
            
            

          

          
            69

            
              

            

          

          
            
            
consent
of the Lender.  The parties to each assignment or participation made
pursuant to this Section 9.04
shall execute and deliver to the Lender, for its acceptance and recording in its
books and records, an assignment and acceptance
agreement (an “Assignment and
Acceptance”) or a participation agreement or other transfer instrument
reasonably satisfactory in form and substance to the Lender and the
Borrower.  Each such assignment or participation shall be effective as
of the date specified in the applicable Assignment and Acceptance or other
agreement or instrument only after the execution, delivery, acceptance and
recording thereof as described in the preceding sentence.  The Lender
shall notify the Borrower of any assignment or participation thereof made
pursuant to this Section 9.04.  The
Lender may, in connection with any assignment or participation or any proposed
assignment or participation pursuant to this Section 9.04,
disclose to the assignee or participant or proposed assignee or participant any
information relating to the Borrower and the Pledged Assets furnished to the
Lender by or on behalf of the Borrower or the Servicer; provided, however, that the
Lender shall not disclose any such information until it has obtained an
agreement from such assignee or participant or proposed assignee or participant
that it shall treat as confidential (under terms mutually satisfactory to the
Lender, the Borrower, the Servicer and such assignee or participant or proposed
assignee or participant) any information obtained which is not already publicly
known or available.

        

         

        (b) Whenever
the term “Lender” is used herein, it shall mean Morgan Stanley and/or any other
Person which shall have executed an Assignment and Acceptance; provided, however, that each
such party shall have a pro rata share of the rights and obligations of the
Lender hereunder in such percentage amount (the “Commitment
Percentage”) as shall be obtained by dividing such party’s commitment to
fund Loans hereunder by the total commitment of all parties to fund Loans
hereunder.  Unless otherwise specified herein, any right at any time
of the Lender to enforce any remedy, shall be exercised by the Lender only upon
direction by such parties that hold a majority of the Commitment Percentages at
such time.

         

        (c) Subject
to Section 9.04(a),
each of the parties hereto hereby agrees to execute any amendment to this
Agreement that is required in order to facilitate the addition of any new Lender
hereunder as contemplated by this Section 9.04 and
which does not have any adverse effect on the Borrower, the Originator, the
Servicer or any Affiliate thereof.

         

        SECTION
9.05 Term of This
Agreement.  This Agreement including, without limitation, the
Borrower’s obligation to observe its covenants set forth in Articles V and
VI and the
Servicer’s obligation to observe its covenants set forth in Articles V and
VI, shall
remain in full force and effect until the Collection Date; provided, however, that the
rights and remedies with respect to any breach of any representation and
warranty made or deemed made by the Borrower or the Servicer pursuant to Articles III and
IV and the
indemnification and payment provisions of Article VIII and
Article IX
and the provisions of Section 9.08 and
Section 9.09
shall be continuing and shall survive any termination of this
Agreement.

         

        SECTION
9.06 GOVERNING
LAW; JURY WAIVER; CONSENT TO JURISDICTION.  a) THIS AGREEMENT
SHALL, IN ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF
THE STATE OF NEW YORK, BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO ANY CONFLICTS OF LAW PRINCIPLES THEREOF THAT WOULD CALL FOR THE
APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE
VALIDITY OR PERFECTION OF THE INTERESTS OF THE LENDER IN THE PLEDGED
RECEIVABLES, OR REMEDIES HEREUNDER, IN RESPECT THEREOF, ARE GOVERNED BY THE LAWS
OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.  

         

        (b) EACH
OF THE PARTIES HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT
IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION ARISING DIRECTLY OR
INDIRECTLY OUT OF, UNDER OR IN CONNECTION WITH THIS AGREEMENT OR ANY OF THE
TRANSACTIONS CONTEMPLATED HEREUNDER.

         

        (c) ANY
LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT MAY BE BROUGHT IN
THE COURTS OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK; AND, BY EXECUTION AND DELIVERY OF THIS AGREEMENT,
EACH OF
THE PARTIES HERETO CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO THE
NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  EACH OF THE PARTIES
HERETO 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
AGREEMENT OR ANY DOCUMENT RELATED HERETO. EACH OF THE PARTIES HERETO WAIVES
PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH SERVICE
MAY BE MADE BY ANY OTHER MEANS PERMITTED BY NEW YORK LAW.

         

        
          
            
            

          

          
            70

            
              

            

          

          
            
            

          

        

        SECTION
9.07 Costs,
Expenses and Taxes.  a) In addition to the rights of
indemnification granted to the Backup Servicer (whether in its capacity as
Backup Servicer or successor Servicer), the Custodian, the Lender’s Bank, the
Lender and its Affiliates under Section 8.01
hereof, the Borrower agrees to pay on demand all reasonable (and reasonably
documented) costs and expenses of the Backup Servicer, the Custodian, the
Lender’s Bank and the Lender incurred in connection with the preparation,
execution or delivery of, or any waiver or consent issued or amendment prepared
in connection with, this Agreement, the other Transaction Documents and the
other documents to be delivered hereunder or in connection herewith or therewith
or incurred in connection with any amendment, waiver or modification of this
Agreement, any other Transaction Document, and any other documents to be
delivered hereunder or thereunder or in connection herewith or therewith that is
necessary or requested (and, with respect to the Lender, actually entered into)
by any of the Borrower, the Servicer, the Lender or made necessary or desirable
as a result of the actions of any regulatory, tax or accounting body affecting
the Lender and its Affiliates, or which is related to an Event of Default,
including, without limitation, the reasonable fees and out-of-pocket expenses of
counsel for the Backup Servicer, the Custodian, the Lender’s Bank and the Lender
with respect thereto and with respect to advising the Backup Servicer, the
Custodian, the Lender’s Bank and the Lender as to their respective rights and
remedies under this Agreement and the other documents to be delivered hereunder
or in connection herewith, and all costs and expenses, if any (including
reasonable counsel fees and expenses), incurred by the Backup Servicer, the
Custodian, the Lender’s Bank or the Lender in connection with the enforcement of
this Agreement and the other documents to be delivered hereunder or in
connection herewith.

         

        (b) The
Borrower shall pay on demand any and all stamp, sales, excise and other taxes
and fees payable or determined to be payable in connection with the execution,
delivery, filing and recording of this Agreement, the other documents to be
delivered hereunder or any agreement or other document providing liquidity
support, credit enhancement or other similar support to the Lender which is
specific to this Agreement or the funding or maintenance of Loans
hereunder.

         

        (c) The
Borrower shall pay on demand all other costs, expenses and taxes (excluding
franchise and income taxes) incurred by the Lender or the Initial Qualifying
Swap Counterparty or any shareholder thereof related to this Agreement, any
other Transaction Document or any Qualifying Interest Rate Swap or similar
interest rate cap agreement (“Other Costs”),
including, without limitation, the reasonable fees and out-of-pocket expenses of
counsel for the Lender or the Initial Qualifying Swap Counterparty with respect
to (i) advising such Person as to its rights and remedies under this
Agreement and the other documents to be delivered hereunder or in connection
herewith and (ii) the enforcement of this Agreement and the other documents
to be delivered hereunder or in connection herewith; provided, however, that the
Borrower shall have no obligation to pay the fees and out-of-pocket expenses of
counsel to the Initial Qualifying Swap Counterparty related to the initial
negotiation, execution and delivery of any Qualifying Interest Rate
Swap.

         

        (d) Without
limiting any other provision hereof, the Borrower shall pay on demand all costs,
expenses and fees of the Backup Servicer prior to the occurrence of a Servicer
Default and the appointment of the Backup Servicer as Servicer hereunder related
to its duties under this Agreement.

         

        (e) Any
Person making a claim under this Section 9.07
shall submit to the Borrower a notice setting forth in reasonable detail the
basis for and the computations of the applicable costs, expenses, taxes or
similar items.

         

        SECTION
9.08 No
Proceedings.  The Servicer, the Backup Servicer, the Custodian,
the Lender and the Lender’s Bank each hereby agree that it will not institute
against, or join any other Person in instituting against, the Borrower
any proceedings of the type referred to in the definition of Bankruptcy Event
prior to the date that is one
year and one day following the Collection Date.

         

        
          
            
            

          

          
            71

            
              

            

          

          
            
            

          

        

        SECTION
9.09 Recourse
Against Certain Parties.  No recourse under or with respect to
any obligation, covenant or agreement (including, without limitation, the
payment of any fees or any other obligations) of the Lender as contained in this
Agreement or any other agreement, instrument or document entered into by the
Borrower or the Lender pursuant hereto or in connection herewith shall be had
against any administrator of the Borrower or the Lender or any incorporator,
affiliate, stockholder, officer, employee or director of the Borrower or the
Lender or of any such administrator, as such, by the enforcement of any
assessment or by any legal or equitable proceeding, by virtue of any statute or
otherwise; it being expressly agreed and understood that the
agreements of each party hereto contained in this Agreement and all of the other
agreements, instruments and documents entered into by the Borrower or the Lender
pursuant hereto or in connection herewith are, in each case, solely the
corporate obligations of such party (and nothing in this Section 9.09
shall be construed to diminish in any way such corporate obligations of such
party), and that no personal liability whatsoever shall attach to or be incurred
by any administrator of the Borrower or the Lender or any incorporator,
stockholder, affiliate, officer, employee or director of the Borrower or the
Lender or of any such administrator, as such, or any of them, under or by reason
of any of the obligations, covenants or agreements of the Borrower or the Lender
contained in this Agreement or in any other such instruments, documents or
agreements, or which are implied therefrom, and that any and all personal
liability of every such administrator of the Borrower or the Lender and each
incorporator, stockholder, affiliate, officer, employee or director of the
Borrower or the Lender or of any such administrator, or any of them, for
breaches by the Borrower or the Lender of any such obligations, covenants or
agreements, which liability may arise either at common law or in equity, by
statute or constitution, or otherwise, is hereby expressly waived as a condition
of and in consideration for the execution of this Agreement.  The
provisions of this Section 9.09
shall survive the termination of this Agreement.

         

        SECTION
9.10 Execution in
Counterparts; Severability; Integration.  This Agreement may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed shall be deemed to be an
original and all of which when taken together shall constitute one and the same
agreement.  Delivery of an executed counterpart of a signature page to
this Agreement by facsimile shall be effective as delivery of a manually
executed counterpart of this Agreement.  In the event that any
provision in or obligation under this Agreement shall be invalid, illegal or
unenforceable in any jurisdiction, the validity, legality and enforceability of
the remaining provisions or obligations, or of such provision or obligation in
any other jurisdiction, shall not in any way be affected or impaired
thereby.  This Agreement contains the final and complete integration
of all prior expressions by the parties hereto with respect to the subject
matter hereof and shall constitute the entire agreement among the parties hereto
with respect to the subject matter hereof, superseding all prior oral or written
understandings other than the Fee Letter.

         

        SECTION
9.11 Tax
Characterization.  Notwithstanding any provision of this
Agreement, the parties hereto intend that the Loans advanced hereunder shall
constitute indebtedness of the Borrower for federal income tax
purposes.

         

        SECTION
9.12 Calculation
of Performance Triggers.  Notwithstanding anything to the
contrary herein, Included Repurchased Receivables shall be treated as Pool
Receivables for purposes of each calculation of the Annualized Default Rate,
Annualized Net Loss Rate, Delinquency Rate, Pool A Annualized Net Loss Rate and
the Pool B Annualized Net Loss Rate required to be made hereunder (but for no
other purpose).

         

         

        
          ARTICLE
X.

        

         

        THE COLLATERAL
AGENT

         

        SECTION
10.01 No Implied
Duties.  The Collateral Agent shall be obligated to perform
only the duties as are specifically set forth in this Agreement, and no implied
covenants or obligations shall be read into this Agreement against the
Collateral Agent. 

         

        SECTION
10.02 Limits on
Liability.  The Collateral Agent shall not be liable for any
acts, omissions, errors of judgment or mistakes of fact or law made, taken or
omitted to be made or taken by it in accordance with this Agreement and the
other Transaction Documents (including acts, omissions, errors or mistakes with
respect to the Collateral), except for those arising out of or in connection
with the Collateral Agent’s gross negligence or willful

         

        
          
            
            

          

          
            72

            
              

            

          

          
            
            
misconduct.  The
Collateral Agent may consult with counsel, accountants and other experts, and
any opinion or advice of any such counsel, any such accountant and any such
other expert shall be full and complete authorization and protection in respect
of any action taken or suffered by the Collateral Agent hereunder in accordance
therewith. The Collateral Agent shall have the right at any time to seek
instructions concerning the administration of the Pledged Assets from any court
of competent jurisdiction.  The Collateral Agent may conclusively
rely, and shall be fully protected in acting, upon any resolution, statement,
certificate, instrument, opinion, report, notice, request, consent, order, bond
or other paper or document which it has no reasonable reason to believe to be
other than genuine and to have been signed or presented by the proper party or
parties or, in the case of cables, telecopies and telexes, to have been sent by
the proper party or parties.  Absent its gross negligence or willful
misconduct, the Collateral Agent may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon any
certificates or opinions furnished to the Collateral Agent and conforming to the
requirements of this Agreement and the other Transaction Documents, if
any.

        

         

        SECTION
10.03 Acknowledgement.  The
Lender hereby acknowledges and agrees that its rights and obligations as
“Lender” under the Collection Account Agreement, Security Deposit Account
Agreement and each Cash Reserve Account Agreement are being held in its capacity
as Collateral Agent for the benefit of the Secured Parties. 

         

        [Signature
page to follow.]

         

        
          
            
            

          

          
            73

            
              

            

          

          
            
            

          

        

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

         

        
          	
                  THE
      BORROWER:

                	
                  RESOURCE
      CAPITAL FUNDING II, LLC

                  By:_______________________________________

                  Name:

                  Title:

                
	
                  THE
      SERVICER:

                	
                  LEAF
      FINANCIAL CORPORATION

                  By:_______________________________________

                  Name:

                  Title:

                
	 
      	 
      
	
                  THE
      LENDER:

                	
                  MORGAN
      STANLEY BANK

                  By:_______________________________________

                  Name:

                  Title:

                   

                
	
                  THE
      CUSTODIAN AND

                  THE
      LENDER’S BANK:

                	
                  U.S.
      BANK NATIONAL ASSOCIATION

                  By:_______________________________________

                  Name:

                  Title:

                
	
                  THE
      BACKUP SERVICER

                	
                  LYON
      FINANCIAL SERVICES, INC. (D/B/A

                  U.S.
      BANK PORTFOLIO SERVICES)

                  By:_______________________________________

                  Name:

                  Title:

                

        

         

         

        
          
            
            

          

          
            S-1

            
              

            

          

          
            
            

          

        

        SCHEDULE
I

         

        CONDITION
PRECEDENT DOCUMENTS

         

        As
required by Section 3.01 of
the Agreement, each of the following items must be delivered to the Lender prior
to the date of the initial Borrowing:

         

        (a) A
copy of this Agreement duly executed by each of the parties hereto;

         

        (b) A
certificate of the Secretary or Assistant Secretary of each of the Borrower, the
Originator and the Servicer, dated the date of this Agreement, certifying
(i) the names and true signatures of the incumbent officers authorized to
sign on behalf of the such Person each Transaction Document to which it is a
party (on which certificate the Lender may conclusively rely until such time as
the Lender shall receive from such Person a revised certificate meeting the
requirements of this paragraph (b)), (ii) that the copy of the
certificate of incorporation or formation of each such Person attached thereto
is a complete and correct copy and that such certificate of incorporation or
formation has not been amended, modified or supplemented and is in full force
and effect, (iii) that the copy of the organizational documents of such
Person attached thereto is a complete and correct copy, and that such
organizational documents have not been amended, modified or supplemented and is
in full force and effect, and (iv) the resolutions of the board of
directors or members of such Person approving and authorizing the execution,
delivery and performance by such Person of each Transaction Document to which it
is a party;

         

        (c) Good
standing certificate, dated as of a recent date for each of the Borrower, the
Originator and the Servicer, issued by its jurisdiction of
organization;

         

        (d) Executed,
original copies of proper financing statements (the “Facility Financing
Statements”) describing the Pledged Receivables, Other Conveyed Property,
Related Security and other Pledged Assets, and (a) filed against Originator in
favor of the Borrower as assignor secured party and naming the Collateral Agent
as total assignee and (b) filed against the Borrower and in favor of the
Collateral Agent, as secured party, and other, similar instruments or documents,
as may be necessary or, in the opinion of the Collateral Agent, desirable under
the UCC of all appropriate jurisdictions or any comparable law to perfect the
Collateral Agent’s interests in all Pledged Receivables, Other Conveyed
Property, Related Security and other Pledged Assets;

         

        (e) Executed,
original copies of proper financing statements, if any, necessary to release all
security interests and other rights of any Person in the Pledged Receivables,
Other Conveyed Property, Related Security and other Pledged Assets previously
granted by Originator or the Borrower;

         

        (f) Certified
copies of requests for information or copies (or a similar UCC search report
certified by a party acceptable to the Lender), dated a date reasonably near to
the date of the initial Borrowing, listing all effective financing statements
(including the Facility Financing Statements), which name any of the Borrower or
the Originator (under such party’s present name and any previous name) as debtor
and which are filed in the jurisdictions in which the Facility Financing
Statements were filed, together with copies of such financing statements (none
of which, other than the Facility Financing Statements, shall cover any Pledged
Assets);

         

        (g) One
or more favorable Opinions of Counsel, of counsel to the Originator and the
Borrower, with respect to such matters as the Lender may reasonably request
(including an opinion, with respect to the creation, perfection and first
priority of the security interest of the Borrower and the Collateral Agent in
the property described in such Opinion of Counsel);

         

        (h) One
or more favorable Opinions of Counsel, of counsel to the Originator and the
Borrower, with respect to the true conveyance of the Receivables under the
Purchase and Sale Agreement, and issues of substantive
consolidation;

         

        
          
            
            

          

          
            Sch.
I-1

            
              

            

          

          
            
            

          

        

        (i) One
or more favorable Opinions of Counsel, of counsel to the Originator, the
Borrower, the Custodian and the Backup Servicer with respect to, among other
things, the due authorization, execution and delivery of, and enforceability of,
this Agreement and the other Transaction Documents;

         

        (j) A
favorable Opinion of Counsel of counsel to the Borrower, with respect to the
first priority perfected security interest of the Collateral Agent in the
Collection Account, the Security Deposit Account and the Cash Reserve Account
and the funds therein;

         

        (k) Any
necessary third party consents to the closing of the transactions contemplated
hereby;

         

        (l) A
copy of each of the other Transaction Documents duly executed by the parties
thereto;

         

        (m) A
copy of the fidelity insurance policy referred to in Section 6.16
hereof together with a certification from the applicable insurance company that
such policy is in full force and effect on the date hereof; and

         

        (n) The
results of comprehensive background checks (completed by an investigation
service acceptable to the Lender) on the senior management, key employees and
principals of each of Resource America and LEAF Financial.

         

        
          
            
            

          

          
            Sch.
I-2

            
              

            

          

          
            
            

          

        

        

        SCHEDULE
II

         

        PRIOR
NAMES, TRADENAMES, FICTITIOUS NAMES

         

        AND
“DOING BUSINESS AS” NAMES

         

        1.           Borrower:  None

         

        2.           Servicer:  LEAF
Financial Corp.

         

        LEAF
Financial Corporation was previously named Fidelity Leasing
Corporation.  Effective February 28, 1996, Fidelity Leasing
Corporation changed its name to F.L. Partnership Management,
Inc.  Effective May 1, 2000, F.L. Partnership Management, Inc. and FL
Financial Services, Inc. merged, with F.L. Partnership Management, Inc. as the
surviving entity.  Effective December 13, 2001, F.L. Partnership
Management, Inc. changed its name to LEAF Financial
Corporation.  Effective June 29, 2004, LEAF Asset Management, Inc. and
LEAF Financial Corp. merged, with LEAF Financial Corp. as the surviving
entity.  None

         

        
          
            
            

          

          
            Sch.
II-1

            
              

            

          

          
            
            

          

        

        SCHEDULE
III-A

         

        REPRESENTATIONS
AND WARRANTIES WITH

         

        RESPECT
TO ELIGIBLE POOL A RECEIVABLES

         

        The
following representations and warranties are made by the Borrower with respect
to the Pool A Contracts related to Pledged Pool A Receivables which
are designated as being Eligible Pool A Receivables on a Borrowing Base
Certificate or a Monthly Remittance Report, or are otherwise represented to the
Lender as being Eligible Pool A Receivables, or are included as Eligible
Pool A Receivables in any calculation set forth herein.

         

        1.                                      Each
such Contract represents the genuine, legal, valid, binding and full recourse
payment obligation of the Obligor thereunder, enforceable by the Borrower in
accordance with its terms and the Obligor, with respect to such Contract (and
any guarantor of the Obligor’s obligations thereunder), had full legal capacity
to execute and deliver such Contract and any other documents related
thereto.

         

        2.                                      [Intentionally omitted.]

         

        3.                                      To
the extent that such Contract consists of a “Term Note (Level Payments)” or
“Term Note (Step Payments)” or similar promissory note, together with the
“Master Loan and Security
Agreement”, “Finance Agreement” or similar agreement related thereto and
incorporated by reference therein, each other “Term Note (Level Payments)” or
“Term Note (Step Payments)” or similar promissory note related to the same
“Master Loan and Security Agreement”, “Finance Agreement” or
similar agreement is also a Contract related to a Pledged
Receivable.  To the extent that such Contract consists of a “Master
Lease Schedule”  or similar agreement together with a “Master Lease
Agreement” or similar agreement which is related to, and incorporated by
reference therein, each other “Master Lease Schedule” or similar agreement
related to the same “Master Lease Agreement” or similar agreement  is
also a Contract related to a Pledged Receivable.

         

        4.                                      Each
such Contract, at the time of origination and at all times thereafter, conformed
to all requirements of the Credit and Collection Policy applicable to such
Contract and, in any case, no such Contract would be required to be written off
pursuant to the Credit and Collection Policy.

         

        5.                                      Each
such Contract (i) was (a) originated by Originator in the ordinary course
of Originator’s business and Originator had all necessary licenses and permits
to originate Contracts in the State where the related Obligor and the related
Obligor Collateral were located or (b) purchased by Originator, in a transaction
that would constitute a “true sale” for bankruptcy purposes, from a Person (a
“Seller”)
(other than Northern Leasing Systems, Inc. or any Affiliate thereof) who
originated such Contract in the ordinary course of Seller’s business and who had
all necessary licenses and permits to originate Contracts in the State where the
related Obligor and the related Obligor Collateral were located, (ii) was
sold by Originator to the Borrower under the Purchase and Sale Agreement and the
Borrower has all necessary licenses and permits to own Receivables and enter
into Contracts in the state where the related Obligor and the related Obligor
Collateral are located, (iii) contains customary and enforceable
provisions, such as to render the rights and remedies of the Borrower (and any
assignee thereof)

         

        
          
            
            

          

          
            Sch.
III-A-1

            
              

            

          

          
            
            
adequate
for realization against the collateral security related thereto and (iv)
provides for level Scheduled Payments during the term of such Contract or such
Contract is a Non-Level Payment Contract.

        

         

        6.                                      Each
such Contract was originated by Originator or the Seller without any fraud or
material misrepresentation on the part of the related Obligor or Originator or
the Seller.  Each such Contract was sold by Originator to the Borrower
without any fraud or material misrepresentation on the part of
Originator.

         

        7.                                      No
such Contract is the subject of any litigation, nor is it subject to any right
of rescission, setoff, counterclaim or defense on the part of the Obligor
thereunder.

         

        8.                                      Each
such Contract has had no provision thereof waived, amended, altered or modified
in any respect since its origination except in conformity with the Credit and
Collection Policy.

         

        9.                                      The
Obligor, with respect to each such Contract, has a billing address in the United
States and, except as otherwise permitted in writing by the Lender from time to
time, the Equipment which is the subject of each such Contract and all other
Obligor Collateral with respect thereto is located in the United
States.

         

        10.                                      Each
such Contract (i) is calculated at a fixed yield, (ii) is fully
amortizing in periodic installments over its remaining term (which may include a
Balloon Payment or Put Payment not in excess of 45% of the Discounted Balance of
such Contract at the time of origination), (iii) has a remaining term of
180 months or less and does not permit renewal or extension, (iv) provides
for acceleration of the Scheduled Payments thereunder if the related Obligor is
in default under or has otherwise violated or breached any material provision of
such Contract, (v) prohibits the related Obligor from applying any part of
the Security Deposit or cash collateral paid under such Contract to the
Scheduled Payments due under such Contract (and neither the Originator, the
Servicer, the Borrower or any other Person has applied any part of the Security
Deposit or cash collateral paid under such Contract to any of the Scheduled
Payments due under such Contract) and (vi) has not been assigned by the
related Obligor nor has there been any sub-lease of the Obligor
Collateral.

         

        11.                                      [Intentionally omitted.]

         

        12.                                      Each
such Contract (i) is payable by a single Obligor, that is a
corporate  Person, or, if the collateral is Equipment used in a
business, an individual and (ii) provides for the financing or lease of
Obligor Collateral to be used in the business of the related
Obligor.

         

        13.                                      Each
such Contract was originated in the United States and is denominated and payable
solely in United States Dollars.

         

        14.                                      Each
such Contract (i) if a Lease Contract, contains “hell or high water”
provisions, (ii) requires the related Obligor to assume all risk of loss or
malfunction of the related Obligor Collateral; (iii) requires the related
Obligor to pay all maintenance, repair,

         

        
          
            
            

          

          
            Sch.
III-A-2

            
              

            

          

          
            
            
insurance
and taxes, together with all other ancillary costs and expenses, with respect to
the related Obligor Collateral; and (iv) requires the related Obligor to
pay, in full, when due, all Scheduled Payments notwithstanding any casualty,
loss or other damage to the related Obligor Collateral.

        

         

        15.                                      Each
such Contract is by its terms an absolute and unconditional obligation of the
related Obligor and is non-cancelable (in the case of a Lease Contract) and
non-cancelable and non-prepayable without the payment in full of principal and
accrued interest and finance charges prior to the expiration of the term of such
Contract; such Contract does not provide for the substitution, exchange or
addition of any other items of Obligor Collateral related to such Contract if
the effect thereof would be to reduce or extend the Scheduled Payments related
thereto; and the rights with respect to such Contract are assignable by
Originator (and its successors and assigns, including the Borrower) without the
consent of or notice to any Person.

         

        16.                                      Each
such Contract is in the form of one of the form contracts attached hereto as
Exhibit D-1,
Exhibit D-2 or
Exhibit D-3 or
in a form otherwise approved by the Servicer in compliance with the Credit and
Collection Policy.

         

        17.                                      The
Security Deposit, if any, related to such Contract has been deposited into the
Security Deposit Account within ten Business Days of the Pledge of the related
Receivable.

         

        18.                                      All
material requirements of applicable federal, state and local laws, and
regulations thereunder in respect of each such Contract, the origination
thereof, and the Obligor Collateral related thereto, have been complied with in
all respects.

         

        19.                                      The
applicable Obligor (other than a lessee under a Lease Contract that is a “true
lease”) has good and marketable title to the Equipment which is the subject of
each such Contract and such Equipment is free and clear of all Adverse
Claims.

         

        20.                                      Each
such Contract constitutes either an “Instrument” or “Chattel Paper” or a
“Payment Intangible” within the meaning of the UCC.

         

        21.                                      Each
such Contract contains language by which the related Obligor grants a security
interest to Originator in the Obligor Collateral which is the subject of each
such Contract.

         

        22.                                      (A) The
Originator shall have taken or caused to be taken all steps necessary under all
applicable law (including the filing of an Obligor Financing Statement with
respect to each such Contract) in order to cause a valid, subsisting and
enforceable perfected, first priority security interest to exist in Originator’s
favor in the Obligor Collateral securing each such Contract (other than with
respect to Equipment which has a value of less than $25,000 if such Equipment is
leased under Dollar Purchase Option Contracts or $50,000 if such Equipment is
leased under FMV Contracts), (B) Originator shall have assigned the
perfected, first priority security interest in the Obligor Collateral referred
to in clause (A) above to the Borrower pursuant to the Purchase and Sale
Agreement and (C) the Borrower shall have

         

        
          
            
            

          

          
            Sch.
III-A-3

            
              

            

          

          
            
            
assigned
the perfected, first priority security interest in the Obligor Collateral
referred to in clause (A) above to the Collateral Agent pursuant to Section 2.11
hereof.

        

         

        23.                                      The
Borrower has taken all steps necessary under all applicable law in order to
perfect the security interest of the Collateral Agent in (i) the Borrower’s
interest in the Obligor Collateral related to each such Contract (other than
Equipment which has a value of less than $25,000 if such Equipment is leased
under Dollar Purchase Option Contracts or $50,000 if such Equipment is leased
under FMV Contracts) and (ii) each such Contract and the Receivable,
Related Security and Other Conveyed Property related thereto (and the proceeds
thereof), and there exists in favor of the Collateral Agent as secured party, a
valid, subsisting and enforceable first priority perfected security interest in
(i) the Borrower’s interest in such Obligor Collateral and (ii) such
Contract and the Receivable, Related Security and Other Conveyed Property
related thereto (and the proceeds thereof) and such security interest is and
shall be prior to all other liens upon and security interests in (i) the
Borrower’s interest in such Obligor Collateral and (ii) such Contract and
the Receivable, Related Security and Other Conveyed Property related thereto
(and the proceeds thereof) that now exist or may hereafter arise or be created
(other than Permitted Liens).

         

        24.                                      If
the Obligor Collateral related to such Contract includes a Vehicle, such
Contract shall be a Loan Contract or a Dollar Purchase Option Contract, and the
Borrower or the Servicer shall have delivered to the applicable Registrar of
Titles an application for a Certificate of Title for such Vehicle satisfying the
Titling Requirements.

         

        25.                                      No
such Contract is a Defaulted Receivable or, at the time of its Pledge hereunder,
a Delinquent Receivable.

         

        26.                                      Each
such Contract is payable by an Obligor which is not subject to any bankruptcy,
insolvency, reorganization or similar proceeding.

         

        27.                                      The
information pertaining to each such Contract set forth in the Schedule of
Contracts (as defined in the Purchase and Sale Agreement), the related
Assignment and each Borrowing Base Certificate and Monthly Remittance Report is
true and correct in all respects.

         

        28.                                      With
respect to each such Contract, by the Borrowing Date on which such Contract is
Pledged hereunder and on each relevant date thereafter, Originator will have
caused its master computer records relating to such Contract to be clearly and
unambiguously marked to show that such Contract has been Pledged under this
Agreement.

         

        29.                                      With
respect to each such Contract there exists a Receivable File and such Receivable
File contains each item listed in the definition of Receivable File with respect
to such Contract and such Receivable File has been delivered to the
Custodian.

         

        30.                                      No
such Contract has been repaid, prepaid, satisfied, subordinated or rescinded,
and the Obligor Collateral securing such Contract has not been released from the
lien of the Lender in whole or in part (except for releases of Equipment from a
Contract prior to the date of the Pledge thereof and which releases have been
noted in the Collateral Receipt related to such document).

         

        
          
            
            

          

          
            Sch.
III-A-4

            
              

            

          

          
            
            

          

        

        31.                                      No
such Contract was originated in, or is subject to the laws of, any jurisdiction
the laws of which would make unlawful, void or voidable the sale, transfer,
pledge and/or assignment of such Contract under this Agreement or the Purchase
and Sale Agreement, and Originator has not entered into any agreement with any
Obligor that prohibits, restricts or conditions the sale, transfer, pledge
and/or assignment of such Contract.

         

        32.                                      [Intentionally
Omitted].

         

        33.                                      No
such Contract has been sold, transferred, assigned or pledged by Originator to
any Person other than the Borrower.  Borrower has not taken any action
to convey any right to any Person that would result in such Person having a
right to payments due under any such Contract or payments received under the
related Insurance Policy or otherwise to impair the rights of the Borrower or
the Lender in such Contract, the related Insurance Policy or any proceeds
thereof.  There is an Insurance Policy in full force and effect with
respect to the Equipment related to such Contract if such Equipment had an
original cost over $100,000.

         

        34.                                      No
such Contract is assumable by another Person in a manner which would release the
Obligor thereof from such Obligor’s obligations to Originator or the
Borrower.

         

        35.                                      There
has been no default, breach, violation or event permitting acceleration under
the terms of any such Contract, and no condition exists or event has occurred
and is continuing that with notice, the lapse of time or both would constitute a
default, breach, violation or event permitting acceleration under the terms of
any such Contract, and there has been no waiver of any of the
foregoing.

         

        36.                                      No
selection procedures adverse to the Borrower or the Lender have been utilized in
selecting any such Contract from all other similar Contracts originated or
purchased by Originator.

         

        37.                                      The
Obligor Collateral related to any such Contract is not subject to any tax or
mechanic’s lien or any other Adverse Claim.

         

        38.                                      [Intentionally omitted.]

         

        39.                                      The
Borrower has delivered to the Custodian the sole original counterpart of each
such Contract (or a true and correct copy thereof) and such document constitutes
the entire agreement between the parties thereto in respect of the related
Obligor Collateral.

         

        40.                                      Each
such Contract is in full force and effect in accordance with its terms and
neither the Borrower nor the Obligor has or will have suspended or reduced any
payments or obligations due or to become due thereunder by reason of a default
by any other party to such Contract; there are no proceedings pending or
threatened asserting insolvency of such Obligor; there are no proceedings
pending or threatened wherein such Obligor, any other obligated party or any
governmental agency has alleged that such Contract is illegal or
unenforceable.

         

        
          
            
            

          

          
            Sch.
III-A-5

            
              

            

          

          
            
            

          

        

        41.                                      The
origination and collection practices used by the Servicer with respect to each
such Contract have been in all respects customary in the equipment financing and
servicing business.

         

        42.                                      The
Obligor Collateral related to each such Contract was properly delivered to the
Obligor in good repair and is in proper working order. Each Obligor has accepted
the related Equipment.  The related Obligor is the end user of the
Equipment that is the subject of any such Contract and no Obligor has sublet the
Equipment to any other party.

         

        43.                                      The
Obligor with respect to any such Contract is not a merchant with respect to the
Equipment related to such Contract.

         

        44.                                      Except
with respect to a breach of an Obligor’s right of quiet enjoyment of the related
Equipment, neither the operation of any of the terms of any such Contract nor
the exercise by the Borrower, the Servicer or the Obligor of any right under any
such Contract will render such Contract unenforceable in whole or in part nor
subject to any right of rescission, setoff, claim, counterclaim or defense, and
no such right of rescission, set-off, claim, counterclaim or defense, including
a defense arising out of a breach of the Obligor’s right of quiet enjoyment of
the Equipment, has been asserted with respect thereto.

         

        45.                                      The
Borrower and the Servicer have duly fulfilled all obligations on their part to
be fulfilled under or in connection with the origination, acquisition and
assignment of such Contract, including, without limitation, giving any notices
and obtaining any consents necessary to effect the acquisition of such Contract
by the Borrower, and have done nothing to impair the rights of the Borrower or
the Lender in the Contract or payments with respect thereto.

         

        46.                                      Originator
and the Servicer have duly fulfilled all obligations on their part to be
fulfilled under or in connection with the origination, acquisition and
assignment of such Contract, and have done nothing to impair the rights of the
Borrower in such Contract or payments with respect
thereto.  Originator, the Servicer and Borrower have duly fulfilled
all continuing obligations on their part to be fulfilled under or in connection
with such Contract.

         

        47.                                      [Intentionally
Omitted].

         

        48.                                      The
sale from the Originator to the Borrower of each such Contract and the Other
Conveyed Property and Related Security related thereto does not violate the
terms or provisions of any agreement to which the Borrower is a party or by
which it is bound.

         

        49.                                      The
transfer, assignment and conveyance of the Contract and the related Related
Security and Other Conveyed Property from the Originator to the Borrower
pursuant to the Purchase and Sale Agreement is not subject to nor will result in
any tax, fee or governmental charge payable by the Borrower or any other Person
to any federal, state or local government.

         

        
          
            
            

          

          
            Sch.
III-A-6

            
              

            

          

          
            
            

          

        

        50.                                      No
such Contract may be (i) an executory contract or (ii) in any event,
deemed to be an executory contract or unexpired lease subject to rejection by an
Obligor under Section 365 of the Bankruptcy Code in the event that a
Bankruptcy Event has occurred with respect to such Obligor.

         

        51.                                      Each
such Contract contains enforceability provisions (i) permitting the
acceleration of the payments thereunder if the Obligor is in default under such
Contract and (ii) sufficient to enable the Borrower to repossess or
foreclose upon the Obligor Collateral related thereto.

         

        52.                                      Each
such Contract generally contains provisions requiring the payment of both
interest and principal (or, in the case of a Lease Contract, lease payments) in
each calendar month or quarter during the term of such Contract.

         

        53.                                      The
promissory note, if any, related to each such Contract (i) was payable to
the Originator immediately prior to its transfer to the Borrower under the
Purchase and Sale Agreement, and (ii) was payable to the Borrower
immediately prior to its Pledge hereunder and has not been endorsed by
Originator to any Person other than the Borrower.

         

        54.                                      The
final Scheduled Payment required by each such Contract is less than or equal to
the Discounted Balance of such Contract at the time of origination.

         

        55.                                      The
Obligor Collateral related to such Contract is not one or more Vehicles
regularly engaged in the long-haul transportation of goods.

         

        56.                                      The
Obligor with respect to any such Contract which is a lease of, or is secured by,
Equipment related to the practice of dentistry, medicine or veterinary medicine
is a dentist, doctor or veterinarian.

         

        57.                                      The
vendor of the Equipment relating to such Receivable has received payment in full
from the Obligor prior to the Pledge of such Receivable hereunder and has no
remaining obligations with respect to such Equipment except for any applicable
warranty.

         

        
          
            
            

          

          
            Sch.
III-A-7

            
              

            

          

          
            
            

          

        

        SCHEDULE
III-B

         

        REPRESENTATIONS
AND WARRANTIES WITH RESPECT TO

         

        ELIGIBLE
POOL B RECEIVABLES

         

        The
following representations and warranties are made by the Borrower with respect
to the Pool B Contracts related to Pledged Pool B Receivables which
are designated as being Eligible Pool B Receivables on a Borrowing Base
Certificate or a Monthly Remittance Report, or are otherwise represented to the
Lender as being Eligible Pool B Receivables, or are included as Eligible
Pool B Receivables in any calculation set forth herein.

         

        1.                                      Each
such Contract represents the genuine, legal, valid, binding and full recourse
payment obligation of the Obligor thereunder, enforceable by the Borrower in
accordance with its terms and the Obligor, with respect to such Contract (and
any guarantor of the Obligor’s obligations thereunder), had full legal capacity
to execute and deliver such Contract and any other documents related
thereto.

         

        2.                                      [Intentionally omitted.]

         

        3.                                      The
Obligor under such Contract has been continuously originating lease or loan
agreements related to equipment with an original cost of less than $100,000 for
at least three (3) complete calendar years unless such Obligor is Pentech
Financial Services, Inc.

         

        4.                                      Each
such Contract, at the time of origination and at all times thereafter, conformed
to all requirements of the Credit and Collection Policy applicable to such
Contract and, in any case, no such Contract would be required to be written off
pursuant to the Credit and Collection Policy.

         

        5.                                      Each
such Contract (i) was originated by Originator in the ordinary course of
Originator’s business and Originator had all necessary licenses and permits to
originate Contracts in the State where the related Obligor and the related
Obligor Collateral were located, (ii) was sold by Originator to the
Borrower under the Purchase and Sale Agreement and the Borrower has all
necessary licenses and permits to own Receivables and enter into Contracts in
the state where the related Obligor and the related Obligor Collateral are
located, (iii) contains customary and enforceable provisions, such as to
render the rights and remedies of the Borrower (and any assignee thereof)
adequate for realization against the collateral security related thereto and
(iv) provides for level Scheduled Payments during the term of such Contract or
such Contract is a Non-Level Payment Contract.

         

        6.                                      Each
such Contract was originated by Originator without any fraud or material
misrepresentation on the part of the related Obligor or
Originator.  Each such Contract was sold by Originator to the Borrower
without any fraud or material misrepresentation on the part of
Originator.

         

        7.                                      No
such Contract is the subject of any litigation, nor is it subject to any right
of rescission, setoff, counterclaim or defense on the part of the Obligor
thereunder.

         

        
          
            
            

          

          
            Sch.
III-B-1

            
              

            

          

          
            
            

          

        

        8.                                      Each
such Contract has had no provision thereof waived, amended, altered or modified
in any respect since its origination except in conformity with the Credit and
Collection Policy.

         

        9.                                      The
Obligor with respect to each such Contract has a billing address in the United
States and, except as otherwise permitted in writing by the Lender from time to
time, all Obligor Collateral with respect thereto is located in the United
States.

         

        10.                                      Each
such Contract (i) is calculated at a fixed yield, (ii) is fully
amortizing in periodic installments over its remaining term (which amortization
may include a Balloon Payment or Put Payment not in excess of 10% of the
aggregate original cost of the related Underlying Equipment), (iii) has a
remaining term of 120 months or less and does not permit renewal or extension,
(iv) provides for acceleration of the Scheduled Payments thereunder if the
related Obligor is in default under or has otherwise violated or breached any
material provision of such Contract, (v) prohibits the related Obligor from
applying any part of the Cash Reserve (if any) paid under such Contract to the
Scheduled Payments due under such Contract (and neither the Originator, the
Servicer, the Borrower or any other Person has applied any part of the Cash
Reserve paid under such Contract to any of the Scheduled Payments due under such
Contract) and (vi) has not been assigned by the related Obligor nor has
there been any sub-lease of the Obligor Collateral.

         

        11.                                      The
obligations of the Obligor under each such Contract are secured by Underlying
Originator Loan Collateral which includes Eligible Pool B Underlying Lease
Contracts and Eligible Pool B Underlying Loan Contracts with aggregate
Discounted Balances equal to or greater than the Discounted Balance of such
Contract.

         

        12.                                      Each
such Contract (i) is payable by a single Obligor, that is a corporate
Person or, if the collateral is Equipment used in a business, an individual and
(ii) provides for the financing or lease of Obligor Collateral to be used
in the business of the related Obligor.

         

        13.                                      Each
such Contract was originated in the United States and is denominated and payable
solely in United States Dollars.

         

        14.                                      [Intentionally omitted.]

         

        15.                                      Each
such Contract is by its terms an absolute and unconditional obligation of the
related Obligor and is non-cancelable and non-prepayable without the payment in
full of principal and accrued interest and finance charges prior to the
expiration of the term of such Contract; such Contract does not provide for the
substitution, exchange or addition of any other items of Underlying Originator
Loan Collateral related to such Contract if the effect thereof would be to
reduce or extend the Scheduled Payments related thereto; and the rights with
respect to such Contract are assignable by Originator (and its successors and
assigns, including the Borrower) without the consent of or notice to any
Person.

         

        16.                                      Each
such Contract conforms with the criteria set forth in Exhibit D-4
hereto.

         

        
          
            
            

          

          
            Sch.
III-B-2

            
              

            

          

          
            
            

          

        

        17.                                      The
Cash Reserve, if any, related to such Contract has been deposited into a Cash
Reserve Account within ten Business Days of the Pledge of the related
Receivable.

         

        18.                                      All
material requirements of applicable federal, state and local laws, and
regulations thereunder in respect of each such Contract, the origination
thereof, and the Obligor Collateral related thereto, have been complied with in
all respects.

         

        19.                                      The
applicable Underlying Obligor (other than a lessee under an Underlying Lease
Contract that is a “true lease”) has good and marketable title to Underlying
Originator Loan Collateral related to such Contract and such Underlying
Originator Loan Collateral is free and clear of all Adverse Claims.

         

        20.                                      Each
such Contract constitutes either an “Instrument” or “Chattel Paper” or a
“Payment Intangible” within the meaning of the UCC.

         

        21.                                      Each
such Contract contains language by which the related Obligor grants a security
interest to Originator in the Obligor Collateral which is the subject of each
such Contract.

         

        22.                                      (A) The
Originator shall have taken or caused to be taken all steps necessary under all
applicable law (including the filing of an Obligor Financing Statement with
respect to each such Contract) in order to cause a valid, subsisting and
enforceable perfected, first priority security interest to exist in Originator’s
favor in the Obligor Collateral securing each such Contract (other than with
respect to Underlying Equipment relating to such Contract which has an original
value of less than $25,000 if such Underlying Equipment is leased under Dollar
Purchase Option Contracts or $50,000 if such Underlying Equipment is leased
under FMV Contracts), (B) Originator shall have assigned the perfected,
first priority security interest in the Obligor Collateral referred to in
clause (A) above to the Borrower pursuant to the Purchase and Sale
Agreement and (C) the Borrower shall have assigned the perfected, first
priority security interest in the Obligor Collateral referred to in
clause (A) above to the Collateral Agent pursuant to Section 2.13
hereof.

         

        23.                                      The
Borrower has taken all steps necessary under all applicable law in order to
perfect the security interest of the Collateral Agent in (i) the Borrower’s
interest in the Obligor Collateral related to each such Contract (other than
with respect to Underlying Equipment relating to such Contract which has an
original value of less than $25,000 if such Underlying Equipment is leased under
Dollar Purchase Option Contracts or $50,000 if such Underlying Equipment is
leased under FMV Contracts) and (ii) each such Contract and the Receivable,
Related Security and Other Conveyed Property related thereto (and the proceeds
thereof), and there exists in favor of the Collateral Agent as secured party, a
valid, subsisting and enforceable first priority perfected security interest in
(i) the Borrower’s interest in such Obligor Collateral and (ii) such
Contract and the Receivable, Related Security and Other Conveyed Property
related thereto (and the proceeds thereof) and such security interest is and
shall be prior to all other liens upon and security interests in (i) the
Borrower’s interest in such Obligor Collateral and (ii) such Contract and
the Receivable, Related Security and Other Conveyed

         

        
          
            
            

          

          
            Sch.
III-B-3

            
              

            

          

          
            
            
Property
related thereto (and the proceeds thereof) that now exist or may hereafter arise
or be created (other than Permitted Liens).

        

         

        24.                                      [Intentionally omitted.]

         

        25.                                      No
such Contract is a Defaulted Receivable or, at the time of its Pledge hereunder,
a Delinquent Receivable.

         

        26.                                      Each
such Contract is payable by an Obligor which is not subject to any bankruptcy,
insolvency, reorganization or similar proceeding.

         

        27.                                      The
information pertaining to each such Contract set forth in the Schedule of
Contracts (as defined in the Purchase and Sale Agreement), the related
Assignment and each Borrowing Base Certificate and Monthly Remittance Report is
true and correct in all respects.

         

        28.                                      With
respect to each such Contract, by the Borrowing Date on which such Contract is
Pledged hereunder and on each relevant date thereafter, Originator will have
caused its master computer records relating to such Contract to be clearly and
unambiguously marked to show that such Contract has been Pledged under this
Agreement.

         

        29.                                      With
respect to each such Contract there exists a Receivable File and such Receivable
File contains each item listed in the definition of Receivable File with respect
to such Contract and such Receivable File is in the possession of the
Custodian.

         

        30.                                      No
such Contract has been repaid, prepaid, satisfied, subordinated or rescinded,
and the Obligor Collateral securing such Contract has not been released from the
lien of the Lender in whole or in part.

         

        31.                                      No
such Contract was originated in, or is subject to the laws of, any jurisdiction
the laws of which would make unlawful, void or voidable the sale, transfer,
pledge and/or assignment of such Contract under this Agreement or the Purchase
and Sale Agreement, and the Originator has not entered into any agreement with
any Obligor that prohibits, restricts or conditions the sale, transfer, pledge
and/or assignment of such Contract.

         

        32.                                      [Intentionally
Omitted].

         

        33.                                      No
such Contract has been sold, transferred, assigned or pledged by the Originator
to any Person other than the Borrower.  Borrower has not taken any
action to convey any right to any Person that would result in such Person having
a right to payments due under any such Contract or payments received under the
related Insurance Policy or otherwise to impair the rights of the Borrower or
the Lender in such Contract, the related Insurance Policy or any proceeds
thereof.

         

        34.                                      No
such Contract is assumable by another Person in a manner which would release the
Obligor thereof from such Obligor’s obligations to Originator or the
Borrower.

         

        
          
            
            

          

          
            Sch.
III-B-4

            
              

            

          

          
            
            

          

        

        35.                                      There
has been no default, breach, violation or event permitting acceleration under
the terms of any such Contract, and no condition exists or event has occurred
and is continuing that with notice, the lapse of time or both would constitute a
default, breach, violation or event permitting acceleration under the terms of
any such Contract, and there has been no waiver of any of the
foregoing.

         

        36.                                      No
selection procedures adverse to the Borrower or the Lender have been utilized in
selecting any such Contract from all other similar Contracts originated or
purchased by Originator.

         

        37.                                      The
Obligor Collateral related to any such Contract is not subject to
any  Adverse Claim.

         

        38.                                      [Intentionally omitted.]

         

        39.                                      The
Borrower has delivered to the Custodian the sole original counterpart (or a true
and correct copy) of each such Contract and such document constitutes the entire
agreement between the parties thereto in respect of the related Obligor
Collateral.

         

        40.                                      Each
such Contract is in full force and effect in accordance with its terms and
neither the Borrower nor the Obligor has or will have suspended or reduced any
payments or obligations due or to become due thereunder by reason of a default
by any other party to such Contract; there are no proceedings pending or
threatened asserting insolvency of such Obligor; there are no proceedings
pending or threatened wherein such Obligor, any other obligated party or any
governmental agency has alleged that such Contract is illegal or
unenforceable.

         

        41.                                      The
origination and collection practices used by the Servicer with respect to each
such Contract have been in all respects customary in the equipment financing and
servicing business.

         

        42.                                      [Intentionally omitted.]

         

        43.                                      [Intentionally omitted.]

         

        44.                                      Neither
the operation of any of the terms of any such Contract nor the exercise by the
Borrower, the Servicer or the Obligor of any right under any such Contract will
render such Contract unenforceable in whole or in part nor subject to any right
of rescission, setoff, claim, counterclaim or defense, and no such right of
rescission, set-off, claim, counterclaim or defense has been asserted with
respect thereto.

         

        45.                                      The
Borrower and the Servicer have duly fulfilled all obligations on their part to
be fulfilled under or in connection with the origination, acquisition and
assignment of the Contract, including, without limitation, giving any notices
and obtaining any consents necessary to effect the acquisition of the Contract
by the Borrower, and have done nothing to impair the rights of the Borrower or
the Lender in the Contract or payments with respect thereto.

         

        
          
            
            

          

          
            Sch.
III-B-5

            
              

            

          

          
            
            

          

        

        46.                                      The
Originator and the Servicer have duly fulfilled all obligations on their part to
be fulfilled under or in connection with the origination, acquisition and
assignment of the Contract, including, without limitation, giving any notices
and obtaining any consents necessary to effect the acquisition of the Contract
by the Borrower pursuant to the Purchase and Sale Agreement, and have done
nothing to impair the rights of the Borrower in the Contract or payments with
respect thereto.  Originator, the Servicer and Borrower have duly
fulfilled all continuing obligations on their part to be fulfilled under or in
connection with such Contract.

         

        47.                                      The
sale from the Originator to the Borrower of each such Contract and the Other
Conveyed Property and Related Security related thereto does not violate the
terms or provisions of any agreement to which the Borrower is a party or by
which it is bound.

         

        48.                                      The
transfer, assignment and conveyance of the Contract and the related Related
Security and Other Conveyed Property from Originator to the Borrower pursuant to
the Purchase and Sale Agreement is not subject to nor will result in any tax,
fee or governmental charge payable by the Borrower or any other Person to any
federal, state or local government.

         

        49.                                      No
such Contract may be (i) an executory contract or (ii) in any event,
deemed to be an executory contract or unexpired lease subject to rejection by an
Obligor under Section 365 of the Bankruptcy Code in the event that a
Bankruptcy Event has occurred with respect to such Obligor.

         

        50.                                      Each
such Contract contains enforceability provisions (i) permitting the
acceleration of the payments thereunder if the Obligor is in default under such
Contract and (ii) sufficient to enable the Borrower to repossess or
foreclose upon the Obligor Collateral related thereto.

         

        51.                                      [Intentionally
omitted.]

         

        52.                                      The
promissory note, if any, related to each such Contract (i) was payable to the
Originator immediately prior to its transfer to the Borrower under the Purchase
and Sale Agreement, and (ii) was payable to the Borrower immediately prior
to its Pledge hereunder and has not been endorsed by Originator to any Person
other than the Borrower.

         

        53.                                      The
final Scheduled Payment required by each such Contract is less than or equal to
the Discounted Balance of such Contract at the time of origination.

         

        54.                                      [Intentionally omitted.]

         

        55.                                      [Intentionally
omitted.]

         

        56.                                      Such
Contract contains “Seller Events of Default” or similar events of default which
(i) would occur if a Pool B Termination Event with respect to the related
Underlying Originator occurred, (ii) would entitle the Borrower, as assignee of
the Originator’s

         

        
          
            
            

          

          
            Sch.
III-B-6

            
              

            

          

          
            
            
rights
under the Contract, to deliver, or cause the delivery of, a redirection notice
which would require all Underlying Obligors to make all payments under
Underlying Contracts sold or pledged to the Originator under such Contract to
Lockbox Account or an account designated by the Borrower or the Servicer and
(iii) would entitle the Borrower, as assignee of the Originator’s rights under
the Contract, to receive 100% of all payments under the Underlying Contracts
sold or pledged to the Originator under such Contract.

        

         

        57.                                      Each
such Contract shall require all amounts payable thereunder to be paid before the
return to the applicable Obligor of, and without setoff with respect to, the
amount of any loan principal or purchase price which would otherwise have been
advanced by the Originator to the applicable Obligor pursuant to the terms of
such Contract, but which was held back by the Originator as a liquidity reserve
or similar reserve.

         

        58.                                      The
Obligor with respect to such Contract is not Northern Leasing Systems, Inc. or
any Affiliate thereof.

         

        

        
          
            
            

          

          
            Sch.
III-B-7

            
              

            

          

          
            
            

          

        

         

        SCHEDULE
III-C

         

        REPRESENTATIONS
AND WARRANTIES WITH RESPECT TO

         

        ELIGIBLE
POOL B UNDERLYING CONTRACTS

         

        The
following representations and warranties are made by the Borrower with respect
to the Underlying Contracts related to Pledged Pool B Receivables, which
are designated as being Eligible Pool B Receivables on a Borrowing Base
Certificate or a Monthly Remittance Report, or are otherwise represented to the
Lender as being Eligible Pool B Receivables, or are included as Eligible
Pool B Receivables in any calculation set forth herein.

         

        1.                                      Each
such Underlying Contract represents the genuine, legal, valid, binding and full
recourse payment obligation of the Underlying Obligor thereunder, enforceable by
the Underlying Originator in accordance with its terms and the Underlying
Obligor, with respect to such Underlying Contract (and any guarantor of the
Underlying Obligor’s obligations thereunder), had full legal capacity to execute
and deliver such Underlying Contract and any other documents related
thereto.

         

        2.                                      [Intentionally omitted.]

         

        3.                                      [Intentionally omitted.]

         

        4.                                      Each
such Underlying Contract at the time of origination and at all times thereafter,
conformed to all requirements of the credit and collection policy of the
applicable Underlying Originator applicable to such Underlying Contract and, in
any case, no such Underlying Contract would be required to be written off
pursuant to such credit and collection policy.

         

        5.                                      Each
such Underlying Contract (i) was originated by an Eligible Underlying
Originator in the ordinary course of its business and such Underlying Originator
had all necessary licenses and permits to originate Underlying Contracts in the
State where the related Underlying Obligor and the related Underlying Collateral
were located, (ii) was pledged by such Underlying Originator to the
Originator under the applicable Pool B Contract and (iii) contains
customary and enforceable provisions, such as to render the rights and remedies
of such Underlying Originator (and any assignee thereof, including, without
limitation, the Borrower) adequate for realization against the collateral
security related thereto.

         

        6.                                      Each
such Underlying Contract was originated by the applicable Underlying Originator
without any fraud or material misrepresentation on the part of the related
Underlying Obligor or Underlying Originator.  Each such Underlying
Contract was pledged by such Underlying Originator to Originator without any
fraud or material misrepresentation on the part of such Underlying Originator or
Originator, as applicable.

         

        7.                                      No
such Underlying Contract is the subject of any litigation, nor is it subject to
any right of rescission, setoff, counterclaim or defense on the part of the
Underlying Obligor thereunder.

         

        
          
            
            

          

          
            Sch.
III-C-1

            
              

            

          

          
            
            

          

        

        8.                                      Each
such Underlying Contract has had no provision thereof waived, amended, altered
or modified in any respect since its origination except in conformity with the
credit and collection policy of the applicable Underlying
Originator.

         

        9.                                      The
Underlying Obligor, with respect to each such Underlying Contract, has a billing
address in the United States and, except as otherwise permitted in writing by
the Lender from time to time, the Underlying Equipment which is the subject of
each such Underlying Contract and all other Obligor Collateral with respect
thereto is located in the United States.

         

        10.                                      Each
such Underlying Contract (i) is calculated at a fixed yield, (ii) is
fully amortizing in periodic installments over its remaining term (which may
include a Balloon Payment or Put Payment not in excess of  10% of the
original cost of the related Underlying Equipment), (iii) has an remaining
term of 120 months or less and does not permit renewal or extension,
(iv) provides for acceleration of the Underlying Scheduled Payments
thereunder if the related Underlying Obligor is in default under or has
otherwise violated or breached any material provision of such Underlying
Contract, (v) prohibits the related Underlying Obligor from applying any
part of the Underlying Security Deposit (if any) paid under such Underlying
Contract to the Underlying Scheduled Payments due under such Underlying Contract
(and neither the Underlying Originator, the Originator, the Servicer, the
Borrower or any other Person has applied any part of the Underlying Security
Deposit paid under such Underlying Contract to any of the Underlying Scheduled
Payments due under such Underlying Contract) and (vi) has not been assigned
by the related Underlying Obligor nor has there been any sub-lease of the
Underlying Obligor Collateral.

         

        11.                                      Such
Underlying Contract has a Discounted Balance of not greater than
$800,000.

         

        12.                                      Each
such Underlying Contract (i) is payable by a single Underlying Obligor,
that is a corporate Person or, if the collateral is Equipment used in a
business, an individual and (ii) provides for the financing or lease of
Underlying Collateral to be used in the business of the related Underlying
Obligor.

         

        13.                                      Each
such Underlying Contract was originated in the United States and is denominated
and payable solely in United States Dollars.

         

        14.                                      Each
such Underlying Contract (i) if an Underlying Lease Contract, contains
“hell or high water” provisions, (ii) requires the related Underlying
Obligor to assume all risk of loss or malfunction of the related Underlying
Collateral; (iii) requires the related Underlying Obligor to pay all
maintenance, repair, insurance and taxes, together with all other ancillary
costs and expenses, with respect to the related Underlying Collateral; and
(iv) requires the related Underlying Obligor to pay, in full, when due, all
Underlying Scheduled Payments notwithstanding any casualty, loss or other damage
to the related Underlying Collateral.

         

        15.                                      Each
such Underlying Contract is by its terms an absolute and unconditional
obligation of the related Underlying Obligor and is non-cancelable (in the case
of

         

        
          
            
            

          

          
            Sch.
III-C-2

            
              

            

          

          
            
            
an
Underlying Lease Contract) and non-cancelable and non-prepayable without the
payment in full of principal and accrued interest and finance charges prior to
the expiration of the term of such Underlying Contract; such Underlying Contract
does not provide for the substitution, exchange or addition of any other items
of Underlying Collateral related to such Underlying Contract if the effect
thereof would be to reduce or extend the Underlying Scheduled Payments related
thereto; and the rights with respect to such Underlying Contract are assignable
by the applicable Underlying Originator (and its successors and assigns,
including Originator and the Borrower) without the consent of or notice to any
Person.

        

         

        16.                                      [Intentionally omitted.]

         

        17.                                      [Intentionally omitted.]

         

        18.                                      All
material requirements of applicable federal, state and local laws, and
regulations thereunder in respect of each such Underlying Contract, the
origination thereof, and the Underlying Collateral related thereto, have been
complied with in all respects.

         

        19.                                      The
applicable Underlying Obligor (other than a lessee under an Underlying Lease
Contract that is a “true lease”) has good and marketable title to the Underlying
Equipment which is the subject of each such Underlying Contract and such
Underlying Equipment is free and clear of all Adverse Claims.

         

        20.                                      Each
such Underlying Contract constitutes either an “Instrument” or “Chattel Paper”
or a “Payment Intangible” within the meaning of the UCC.

         

        21.                                      Each
such Underlying Contract contains language by which the related Underlying
Obligor grants a security interest to the related Underlying Originator in the
Underlying Collateral which is the subject of each such Underlying
Contract.

         

        22.                                      (A) The
applicable Underlying Originator shall have taken or caused to be taken all
steps necessary under all applicable law (including the filing of a sufficient
UCC-1 Financing Statement with respect to each such Underlying Contract) in
order to cause a valid, subsisting and enforceable perfected, first security
interest to exist in such Underlying Contract’s favor in the Underlying
Collateral securing each such Underlying Contract (other than with respect to
Equipment which has a value of less than $25,000 and is leased under Dollar
Purchase Option Contracts or $50,000 and is leased under FMV Contracts) and
(B) such Underlying Originator shall have assigned the perfected, first
priority security interest in the Underlying Collateral referred to in
clause (A) above to Originator pursuant to the applicable Pool B
Contract.  Such security interest is and shall be prior to all other
liens upon and security interests in (i) the Underlying Originator’s in
such Underlying Collateral and (ii) such Underlying Contract (and the
proceeds thereof) that now exist or may hereafter arise or be
created.

         

        23.                                      [Intentionally omitted.]

         

        24.                                      If
the Underlying Collateral related to such Underlying Contract includes a
Vehicle, such Underlying Contract shall be an Underlying Loan Contract or a
Dollar Purchase Option Contract, and the Borrower or the Servicer shall have
delivered to the

         

        
          
            
            

          

          
            Sch.
III-C-3

            
              

            

          

          
            
            
applicable
Registrar of Titles an application for a Certificate of Title for such Vehicle
satisfying the Titling Requirements.

        

         

        25.                                      No
such Underlying Contract meets any of the following criteria:

         

        
          	
                   
      

                	
                  (i)

                	
                  any
      part of any Underlying Scheduled Payment (or other amount payable under
      the terms of the related Underlying Contract) remains unpaid for more than
      120 days after the due date therefor set forth in such Underlying
      Contract;

                

        

         

        
          	
                   
      

                	
                  (ii)

                	
                  the
      first or second Underlying Scheduled Payment is not paid in full when due
      under the related Underlying
Contract;

                

        

         

        
          	
                   
      

                	
                  (iii)

                	
                  any
      payment or other material terms of the related Underlying Contract have
      been modified due to credit related reasons after such Underlying Contract
      was acquired by the Originator pursuant to the applicable Pool B
      Contract;

                

        

         

        
          	
                   
      

                	
                  (iv)

                	
                  a
      Bankruptcy Event has occurred with respect to the related Underlying
      Obligor or such Underlying Contract has been or should otherwise be deemed
      uncollectible by the Underlying Originator in accordance with its credit
      and collection policy;

                

        

         

        
          	
                   
      

                	
                  (v)

                	
                  with
      respect to such Underlying Contract the Underlying Originator has
      repossessed the related Underlying
Equipment;

                

        

         

        
          	
                   
      

                	
                  (vi)

                	
                  any
      Underlying Scheduled Payment (or other amount payable under the terms of
      such Underlying Contract) remains unpaid for more than 30 days but
      not more than 120 days after the due date therefor set forth in such
      Underlying Contract.

                

        

         

        26.                                      Each
such Underlying Contract is payable by an Underlying Obligor which is not
subject to any bankruptcy, insolvency, reorganization or similar
proceeding.

         

        27.                                      The
information pertaining to each such Underlying Contract set forth in the
Schedule of Contracts (as defined in the Purchase and Sale Agreement), the
related Assignment and each Borrowing Base Certificate and Monthly Remittance
Report is true and correct in all respects.

         

        28.                                      With
respect to each such Underlying Contract, by the Borrowing Date on which the
related Pool B Contract is Pledged hereunder and on each relevant date
thereafter, the related Underlying Originator will have caused its master
computer records relating to such Underlying Contract to be clearly and
unambiguously marked to show that such Underlying Contract has been pledged to
Originator.

         

        29.                                      [Intentionally omitted.]

         

        30.                                      No
such Underlying Contract has been repaid, prepaid, satisfied, subordinated or
rescinded, and the Underlying Collateral securing such Underlying Contract has
not been released from the lien of the related Underlying Originator, in whole
or in part.

         

        31.                                      No
such Underlying Contract was originated in, or is subject to the laws of, any
jurisdiction the laws of which would make unlawful, void or voidable the
sale,

         

        
          
            
            

          

          
            Sch.
III-C-4

            
              

            

          

          
            
            
transfer,
pledge and/or assignment of such Underlying Contract under this Agreement, the
Purchase and Sale Agreement or the related Pool B Contract, and the related
Underlying Originator has not entered into any agreement with any Underlying
Obligor that prohibits, restricts or conditions the sale, transfer, pledge
and/or assignment of such Underlying Contract.

        

         

        32.                                      No
such Underlying Contract has been sold, transferred, assigned or pledged by the
related Underlying Originator to any Person other than Originator. Such
Underlying Originator has not taken any action to convey any right to any Person
that would result in such Person having a right to payments due under any such
Underlying Contract or payments received under any related Underlying Insurance
Policy or otherwise to impair the rights of Originator in such Underlying
Contract, any Underlying Insurance Policy or any proceeds
thereof.  There is an Underlying Insurance Policy in full force and
effect with respect to the Equipment related to such Underlying Contract if such
Equipment had an original cost over $100,000.

         

        33.                                      [Intentionally omitted.]

         

        34.                                      No
such Underlying Contract is assumable by another Person in a manner which would
release the Underlying Obligor thereof from such Underlying Obligor’s
obligations to the Underlying Originator.

         

        35.                                      There
has been no default, breach, violation or event permitting acceleration under
the terms of any such Underlying Contract, and no condition exists or event has
occurred and is continuing that with notice, the lapse of time or both would
constitute a default, breach, violation or event permitting acceleration under
the terms of any such Underlying Contract, and there has been no waiver of any
of the foregoing.

         

        36.                                      No
selection procedures adverse to Originator have been utilized in selecting any
such Underlying Contract from all other similar Underlying Contracts originated
or purchased by the related Underlying Originator.

         

        37.                                      The
Underlying Collateral related to any such Underlying Contract is not subject to
any Adverse Claim.

         

        38.                                      [Intentionally omitted.]

         

        39.                                      The
related Underlying Originator has delivered to the Originator the sole original
counterpart (or a true and correct copy) of each such Underlying Contract and
such document constitutes the entire agreement of the parties thereto in respect
of the related Underlying Collateral.

         

        40.                                      Each
such Underlying Contract is in full force and effect in accordance with its
terms and neither the related Underlying Originator nor the Underlying Obligor
has or will have suspended or reduced any payments or obligations due or to
become due thereunder by reason of a default by any other party to such
Underlying Contract; there are no proceedings pending or threatened asserting
insolvency of such Underlying Obligor; there are no proceedings pending or
threatened wherein such Underlying Obligor, any other obligated party or
any governmental agency has alleged that such Underlying Contract is illegal or
unenforceable.

         

        
          
            
            

          

          
            Sch.
III-C-5

            
              

            

          

          
            
            

          

        

        41.                                      The
origination and collection practices used by the related Underlying Originator
with respect to each such Underlying Contract have been in all respects
customary in the equipment financing and servicing business.

         

        42.                                      The
Underlying Collateral related to each such Underlying Contract was properly
delivered to the Underlying Obligor in good repair and is in proper working
order. Each Underlying Obligor has accepted the related Underlying
Equipment.  The related Underlying Obligor is the end user of the
Underlying Equipment that is the subject of any such Underlying Contract and no
Underlying Obligor has sublet the Underlying Equipment to any other
party.

         

        43.                                      The
Underlying Obligor with respect to any such Underlying Contract is not a
merchant with respect to the Underlying Equipment related to such Underlying
Contract and is not a partner, member or Affiliate of the Underlying
Originator.

         

        44.                                      Except
with respect to a breach of an Underlying Obligor’s right of quiet enjoyment of
the related Underlying Equipment, neither the operation of any of the terms of
any such Underlying Contract nor the exercise by the Underlying Originator, the
Borrower, the Servicer or the Obligor of any right under any such Underlying
Contract will render such Underlying Contract unenforceable in whole or in part
nor subject to any right of rescission, setoff, claim, counterclaim or defense,
and no such right of rescission, set-off, claim, counterclaim or defense,
including a defense arising out of a breach of the Underlying Obligor’s right of
quiet enjoyment of the Underlying Equipment, has been asserted with respect
thereto.

         

        45.                                      The
Underlying Originator has duly fulfilled all obligations on its part to be
fulfilled under or in connection with the origination, acquisition and
assignment of the Underlying Contract, including, without limitation, giving any
notices and obtaining any consents necessary to effect, as applicable, the
acquisition of the Underlying Contract by, or the pledge of the Underlying
Contract to, the Originator, and has done nothing to impair the rights of
Originator in the Underlying Contract or payments with respect
thereto.  The Underlying Originator, Originator, the Servicer and
Borrower, as applicable, have duly fulfilled all continuing obligations on their
part to be fulfilled under or in connection with such Underlying
Contract.

         

        46.                                      [Intentionally omitted.]

         

        47.                                      The
sale from the related Underlying Originator to Originator of each such
Underlying Contract does not violate the terms or provisions of any agreement to
which either of them is a party or by which it is bound.

         

        48.                                      [Intentionally omitted.]

         

        49.                                      The
pledge of the Underlying Contract from the related Underlying Originator to
Originator pursuant to the related Pool B Contract is not subject to or
will
result in any tax, fee or governmental charge payable by Originator or any other
Person to any federal, state or local government.

         

        
          
            
            

          

          
            Sch.
III-C-6

            
              

            

          

          
            
            

          

        

        50.                                      No
such Underlying Contract may be (i) an executory contract  or
(ii) in any event, deemed to be an executory contract or unexpired lease
subject to rejection by an Underlying Obligor under Section 365 of the
Bankruptcy Code in the event that a Bankruptcy Event has occurred with respect
to such Underlying Obligor.

         

        51.                                      Each
such Underlying Contract contains enforceability provisions (i) permitting
the acceleration of the payments thereunder if the Underlying Obligor is in
default under such Underlying Contract and (ii) sufficient to enable the
related Underlying Originator (or any assignee thereof) to repossess or
foreclose upon the Underlying Collateral related thereto.

         

        52.                                      Each
such Underlying Contract generally contains provisions requiring the payment of
both interest and principal (or, in the case of an Underlying Lease Contract,
lease payments) in each calendar month or quarter during the term of such
Underlying Contract.

         

        53.                                      The
promissory note, if any, related to each such Underlying Contract (i) was
payable to the related Underlying Originator immediately prior to its transfer
to Originator pursuant to the related Pool B Contract and has not been
endorsed by the related Underlying Originator to any Person other than
Originator.

         

        54.                                      The
final Underlying Scheduled Payment required by each such Underlying Contract is
less than or equal to the Discounted Balance of such Underlying Contract at the
time of origination.

         

        55.                                      The
Underlying Collateral related to such Underlying Contract is not one or more
Vehicles regularly engaged in the long-haul transportation of
goods.

         

        56.                                      The
related Underlying Originator is not a guarantor under any Underlying
Contract.

         

        57.                                      The
vendor of the Underlying Equipment relating to such Underlying Contract has
received payment in full from the Underlying Obligor prior to the pledge of such
Underlying Contract under the related Pool B Contract and has no remaining
obligations with respect to such Underlying Equipment except for any applicable
warranty.

         

        58.                                      Such
Underlying Contract was not originated by Northern Leasing Systems, Inc. or any
Affiliate thereof.

         

        
          
            
            

          

          
            Sch.
III-C-7

            
              

            

          

          
            
            

          

        

        SCHEDULE
IV

         

        CREDIT
AND COLLECTION POLICY

         

        Attached.

         

        
          
            
            

          

          
            Sch.
IV-1

            
              

            

          

          
            
            

          

        

        SCHEDULE
V

         

        EQUIPMENT
CATEGORIES

         

        
          
            
            

          

          
            Sch.
V-1

            
              

            

          

          
            
            

          

        

        SCHEDULE
VI

         

        ADDRESSES
FOR NOTICE

         

        Resource
Capital Funding II, LLC

        c/o Leaf Funding
Inc.

        c/o LEAF Commercial Finance Fund,
LLC

        One Commerce Square

        18182005 Market Street, 915th Floor

        Philadelphia,
PA 19103

        Attention:  Matthew
Goldenberg

        Facsimile
No.:  (215) 640-6370

        Confirmation
No.:  (215) 231-7070

         

        LEAF
Financial Corporation

        One Commerce Square

        18182005 Market Street, 915th Floor,

        Philadelphia,
PA 19103

        Attention:  Miles
Herman

        Facsimile
No.:  (215) 640-6363

        Confirmation
No.:  (215) 717-3358

        

        Morgan
Stanley Capital Services Inc.

        Transaction
Management Group

        1585
Broadway

        New York,
NY 10236-8293

        Attention:  Chief
Legal Officer

        Facsimile
No.: 001-212-507-4022

        

        Morgan
Stanley Credit

        750
Seventh Avenue

        New York,
NY 10019

        Facsimile
No.: (212) 507-5890

        E-mail:
spvmonthlyreport@morganstanley.com

        

        Morgan
Stanley Bank

        1221
Avenue of the Americas

        New York,
NY 10020

        Attention:  Peter
Woroniecki

        Facsimile
No.:  (212) 762-6943

        Confirmation
No.:  (212) 762-6942

        

        
          
            
            

          

          
            Sch.
VI-1

            
              

            

          

          
            
            

          

        

        

        U.S. Bank
National Association

        EP-MN-WS3D

        60
Livingston Ave.

        St. Paul,
MN 55107

        Attention:  Diane
Reynolds

        Facsimile
No.:  (651) 495-8090

        Confirmation
No.:  (651) 495-3923

        

        Lyon
Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services)

        U.S. Bank
Portfolio Services

        1310
Madrid Street

        Marshall,
MN 56258

        Attention:  Joe
Andries

        Facsimile
No.:  (866) 806-0775

        Confirmation
No.:  (507) 532-7129

        

         

        
          
            
            

          

          
            Sch.
VI-2

            
              

            

          

          
            
            

          

        

        EXHIBIT
A

         

        FORM OF
BORROWING BASE CERTIFICATE

         

        BORROWING BASE
CERTIFICATE

         

                                                                                                                   __________,
200__

         

        To:     Morgan
Stanley Bank

                   1221
Avenue of the Americas

                   New
York, NY 10020

                   Attn:
Peter Woroniecki

         

        Ladies
and Gentlemen:

         

        Reference
is made to the Receivables Loan and Security Agreement dated as of October 31,
2006 (the “Loan
Agreement”), among Resource Capital Funding II, LLC, (the “Borrower”),
Leaf Financial Corporation, as the Servicer, Morgan Stanley Bank, as Lender,
U.S. Bank National Association, as the Custodian and the Lender’s Bank and Lyon
Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services) as the Backup
Servicer.  Capitalized terms used herein but not defined herein shall
have the meanings assigned to such terms in the Loan Agreement.

         

        In
accordance with Section 6.10(c) of
the Loan Agreement, the Borrower hereby certifies that, after giving effect to
the Borrowing requested to occur on __________, 200__:

         

        (1)           the
aggregate Facility Amount under the Loan Agreement does not exceed the lesser of
(A) the Borrowing Limit and (B) the Borrowing Base;

        (2)           if
such Borrowing is to be secured by Pool A Receivables, the aggregate Facility
Amount under the Loan Agreement, calculated solely with respect to Loans secured
by Pool A Receivables, does not exceed the Pool A Borrowing Base;

        (3)           if
such Borrowing is to be secured by Pool B Receivables, the aggregate Facility
Amount under the Loan Agreement, calculated solely with respect to Loans secured
by Pool B Receivables, does not exceed the Pool B Borrowing Base;

        (4)           no
Program Termination Event exists;

        (5)           if
such Borrowing is to be secured by Pool A Receivables, no Pool A Termination
Event exists;

        (6)           if
such Borrowing is to be secured by Pool B Receivables, no Pool B Termination
Event exists; and

         

        The
Borrower hereby further certifies that attached hereto as Schedule A are true
and correct calculations evidencing the accuracy of the statements set forth in
paragraphs (1) and, as applicable, (2) or (3) above.

         

        Very
truly yours,

         

        RESOURCE
CAPITAL FUNDING II, LLC

         

        By:                 /s/ Miles
Herman                                              

                                                                                        Name:            Miles
Herman

                                                                                        Title:              Vice
President

        

         

        
          
            
            

          

          
            Exh.
A-1

            
              

            

          

          
            
            

          

        

        EXHIBIT
B

         

        FORM OF
REQUIRED DATA FIELDS

         

         

        (a)           Obligor
lease number;

         

        (b)           Obligor
name;

         

        (c)           Underlying
Obligor name;

         

        (d)           Obligor
Credit risk rating (if available);

         

        (e)           Collateral
location (city and state);

         

        (f)           Contract
type (pool A or B);

         

        (g)           Equipment
category/type;

         

        (h)           Non
Level Payment Contract flag;

         

        (i)           Balloon
flag and put payment flag;

         

        (j)           Stand
Alone Working Capital Loan Flag;

         

        (k)           New/used
flag (if available);

         

        (l)           Lease
type (true/installment);

         

        (m)           Serial
Number (if available);

         

        (n)           SIC
Code (if available);

         

        (o)           Vendor;

         

        (p)           Commencement
Date

         

        (q)           Maturity
Date;

         

        (r)           Date
Next Due;

         

        (s)           Original
Term;

         

        (t)           Remaining
Term;

         

        (u)           Payment
Frequency;

         

        (v)           Original
Receivable Balance;

         

        (w)           Current
Receivable Balance;

         

        (x)           Original
Equipment Cost;

         

        (y)           Amortized
Equipment Cost;

         

        
          
            
            

          

          
            Exh.
B-1

            
              

            

          

          
            
            

          

        

        (z)           Scheduled
Payment; and

         

        (aa)           Discounted
Balance.

        

        
          
            
            

          

          
            Exh.
B-2

            
              

            

          

          
            
            

          

        

         

        EXHIBIT
C

         

        FORM OF
MONTHLY REMITTANCE REPORT

         

        (See
attached.)

         

        
          
            
            

          

          
            Exh.
C-1

            
              

            

          

          
            
            

          

        

        EXHIBIT
D

         

        FORMS OF
CONTRACT

         

        (See
attached.)

         

        
          
            
            

          

          
            Exh.
D-1

            
              

            

          

          
            
            

          

        

        EXHIBIT
E

         

         

        Vehicle
Lienholder Nominee Agreement

         

        This
Vehicle Lienholder Nominee Agreement (this “Agreement”) is made as of
__________, 2007, among __________ (the “Lienholder”), as Lienholder,
Resource Capital Funding II, LLC (the “Borrower”) and Morgan
Stanley Bank, as Lender (the “Lender”).

         

        Whereas,
from time to time LEAF Funding, Inc. (“Funding”) may acquire an
ownership or security interest in certain Contracts;

         

        WHEREAS,
Lienholder appears as the lienholder of record on the Titles for the Vehicles
sold or leased under such Contracts;

         

        Whereas,
from time to time Funding may sell to the Borrower certain of such Contracts and
all of its right, title and interest in the related Vehicles, and

         

        Whereas,
the Borrower shall pledge, inter alia, such Contracts
and the Borrower’s security interest in each such Vehicle, to the Lender in
order to secure loans being advanced to the Borrower by, and the other
obligations of the Borrower to, the Lender (the “Loan Transactions”);
and

         

        Whereas,
due to the administrative difficulty and costs of amending the Titles of the
Vehicles to note thereon (i) the security interest of the Borrower in such
Vehicles and (ii) the security interest of the Lender in the security interest
of the Borrower in such Vehicles, the Titles to the Vehicles will not be amended
to note such security interests of the Borrower and the Lender but instead, from
and after the date hereof, the Lienholder will act as the Borrower’s and the
Lender’s respective nominee lienholder with respect to the Vehicles pursuant to
the terms hereof;

         

        Now,
Therefore, in consideration of the mutual promises herein contained and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally bound, hereby
agree as follows:

         

               
1.    Term.  This
Agreement will commence on the date hereof and will remain in full force and
effect until the Collection Date.

         

               
2.    Appointment of Nominee
Lienholder.  The Borrower and the Lender hereby appoint the
Lienholder as their nominee lienholder, in a representative capacity, with
respect to the Vehicles, and the Lienholder hereby agrees to serve in such
capacity as described herein.  The Lienholder hereby agrees that all
of its right, title, interest [Add for Pool A: (which is
solely as stated lienholder on the Titles)] in and to the Vehicles shall
be solely for the respective benefit of the Borrower and the
Lender.  As stated lienholder on the Titles to all of such Vehicles,
the Lienholder agrees to take any and all reasonable actions as the Borrower
(with the consent of the Lender) or the Lender may request in writing with
respect to the Titles including, without limitation, all actions for which the
Lienholder’s consent, waiver, release, vote or signature (or other action of
similar nature) is necessary or advisable in the judgment of the Borrower or the
Lender in order to maintain, preserve and protect the Borrower’s
security

         

        
          
            
            

          

          
            Exh.
E-1

            
              

            

          

          
            
            

          

        

        interest
in such Vehicles and the Lender’s security interest in the Borrower’s security
interest in such Vehicles and if the Lienholder fails to take any or all such
actions, the Lender or any designee of the Lender may take such actions at the
sole expense of the Borrower, and the Lienholder hereby grants to the Lender and
any such designee an irrevocable power of attorney and license to take any and
all such actions in the Lienholder’s name and on behalf of the
Lienholder.

         

                       
3.    Interests in the
Vehicles.  Notwithstanding the fact that the Lienholder will be
and remain noted as first lienholder [Add for Pool A: (which is
solely as stated lienholder)] on the Titles to the
Vehicles from time to time pledged to the Borrower and repledged to the Lender,
each party hereto hereby agrees that, on and after the date hereof:

         

            (i)    except as set
forth in subsection (ii) below and subject to the terms of any agreement between
the Borrower and the Lender, the Borrower is entitled to all incidents, benefits
and risks of a holder of a first priority perfected security interest or
ownership in and lien on the Vehicles;

         

            (ii)    subject to
the terms of any agreement between the Borrower and the Lender, the Lender is
entitled to all incidents, benefits and risks of a holder of a first priority
perfected security interest in and lien on the Borrower’s first priority
perfected security interest in and lien on the Vehicles and the right to
exercise or cause the exercise of all remedies with respect to the Vehicles,
including the right to repossess, sell and otherwise transfer and dispose of the
Vehicles at the times and subject to the terms of the Contract with the Obligor
relating to such Vehicle;

         

            (iii)    the
Lienholder has no direct (or indirect) ownership or other rights or interest
(including any security interest) in any of the Vehicles [Pool B add-on: (except its
security interest in the Vehicles, which is to be held under this Agreement
solely for the benefit of the Borrower and the Lender)];

         

            (iv)    the
Lienholder will not take any action with respect to the Vehicles unless such
action is consented to by the Lender; and

         

        
          
            
            

          

          
            Exh.
E-2

            
              

            

          

          
            
            
                     (v)           the
Lienholder shall not represent to any lender, financing source or other Person,
that it has, or in any other manner hold itself out as having, any direct or
indirect ownership interest or any other rights or interests (including any
security interest) in any of the Vehicles, except for any rights it may have as
nominee lienholder hereunder with respect to the Vehicles [Pool B alternative: , except
for its security interest in the Vehicles, which is to be held under this
Agreement solely for the benefit of the Borrower and the
Lender].

        

         

        On the
Collection Date, the Lienholder shall, at the expense of the Borrower, return
the Titles to the Borrower along with a power of attorney, if necessary to
substitute Borrower or Lender as stated lienholder on all Titles, and the
Lienholder shall have no further responsibility for removing the Lienholder as
stated lienholder on the Titles.

         

        4.           Entire
Agreement.  This Agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter of this Agreement
and supersedes any prior understandings, agreements, or representations by or
among the parties hereto, written or oral, to the extent they relate in any way
to the subject matter hereof.

         

        5.           Remittance of
Proceeds.  In the event that Lienholder receives any insurance
proceeds or other payments or proceeds in respect of the Vehicles, it shall hold
the same in trust and notify the Borrower and the Lender of the receipt thereof,
and shall remit promptly such payments or proceeds to the account specified by
the

         

        Lender as
set forth herein, or as otherwise identified by the Lender from time to time by
written notice, but in no event later than the fifth day following receipt of
such payments or proceeds.

         

        6.           Documentation.  From
and after the date hereof, to the extent that Lienholder from time to time
receives any certificate of title or notifications of lienholder status relating
to any Vehicle, Lienholder shall promptly forward the same to U.S. Bank (or,
following the delivery of written notice from Lender to such effect, the
Lender).

         

        7.           Nonpetition.  Lienholder
hereby agrees that it will not institute against, or join any other person or
entity in instituting against Borrower any proceeding under any bankruptcy,
reorganization, liquidation or insolvency law or statute now or hereafter in
effect in any jurisdiction until one year and one day shall have elapsed since
the payment in full of all indebtedness and other obligations owed by Borrower
to the Lender, Lender’s Bank and Collateral Agent with respect to the Loan
Transactions.

         

        8.           Succession and
Assignment.  This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns.  Neither the Lienholder nor the Borrower may assign either
this Agreement or any of its respective rights, interests, or obligations
hereunder without the prior written approval of the Lender.

         

        9.           Counterparts.  This
Agreement may be executed in separate counterparts, each of which will be deemed
an original but all of which together will constitute one and the same
instrument.  Delivery of an executed counterpart of a signature page
to this Agreement by facsimile shall be effective as delivery of a manually
executed counterpart of this Agreement.

         

        10.           Headings.  The
section headings contained in this Agreement are inserted for convenience only
and will not affect in any way the meaning or interpretation of this
Agreement.

         

                       
11.           Notices.  All
notices, requests, demands, claims and other communications hereunder will be in
writing.  Any notice, request, demand, claim, or other communication
hereunder will be deemed duly given if (and then two business days after) it is
sent by registered or certified mail, return receipt requested, postage prepaid,
and addressed to the intended recipient as set forth below:

         

         

        If
to the Lienholder:

         

        
          
            
            

          

          
            Exh.
E-3

            
              

            

          

          
            
            

          

        

        

         

        If
to the Borrower:

         

        Resource
Capital Funding II, LLC

        1818One Commerce
Square

        2005 Market Street, 915th
Floor

        Philadelphia,
Pa  19103

        Attention:
Miles Herman

        Facsimile
No.: (215) 640-6363

        Confirmation
No.: (215) 717-3358

         

        If
to the Lender:

         

        Morgan
Stanley Bank

        1221
Avenue of the Americas

        New York,
NY  10020

        Attention:
Peter Woroniecki

        Facsimile
No.: (212) 762-6943

        Confirmation
No.: (212) 762-6942

         

        Any party
hereto may give written notice, request, demand, claim, or other communication
hereunder using any other means (including personal delivery, expedited courier,
messenger service, telecopy, telex, ordinary mail, or electronic mail), but no
such notice, request, demand, claim, or other communication will be deemed to
have been duly given unless and until it is actually received by the intended
recipient.  Any party hereto may change the address to which notices,
requests, demands, claims and other communications hereunder are to be delivered
by giving the other parties notice in the manner herein set forth.

         

            12.    Governing Law. This
agreement shall, in accordance with section 5-1401 and 5-1402 of the
General Obligations Law of the State of New York, be governed by the laws of the
State of New York, without regard to any conflicts of law principles thereof
that would call for the application of the laws of any other
jurisdiction.

         

            13.    Consent to
Jurisdiction; Waiver of Jury Trial; Etc.  Any legal action or
proceeding with respect to this agreement may be brought in the courts of the
State of New York or of the United States of America for the Southern District
of New York, and, by execution and delivery of this agreement, each party hereto
hereby accepts for itself and in respect of its property, generally and
unconditionally, the nonexclusive jurisdiction of the aforesaid
courts.  Each party hereby irrevocably waives, in connection with any
such action or proceeding, (i) trial by jury, (ii) to the extent it may
effectively do so under applicable law, any objection, including any objection
to the laying of venue or based on the grounds of forum non conveniens, which it
may now or hereafter have to the bringing of any such action or proceeding in
such respective jurisdictions and (iii) the right to interpose any set-off,
counterclaim or cross-claim (unless such set-off, counterclaim or cross-claim
could not, by reason of any applicable federal or state procedural laws, be
interposed, pleaded or alleged in any other action)

         

            14.    Amendments and
Waivers.  No amendment of any provision of this Agreement will
be valid unless the same will be in writing and signed by each of the parties
hereto.  No waiver by the Lender of any default, misrepresentation, or
breach of warranty or covenant hereunder, whether intentional or not, will be
deemed to extend to any prior or subsequent default, misrepresentation, or
breach of warranty or covenant hereunder or affect in any way any rights arising
by virtue of any such prior or subsequent occurrence.

         

        
          
            
            

          

          
            Exh.
E-4

            
              

            

          

          
            
            

          

        

            15.    Severability.  Any
term or provision of this Agreement that is invalid or unenforceable in any
situation in any jurisdiction will not affect the validity or enforceability of
the remaining terms and provisions hereof or the validity or enforceability of
the offending term or provision in any other situation or in any other
jurisdiction.

         

            16.    Definitions.  Capitalized
terms used herein but not previously defined herein have the following
meanings:

         

        (i)
“Collection Date” means the date on which (a) the aggregate outstanding
principal amount of the loans under the Loan Transactions have been repaid in
full and all interest and fees and all other obligations of the Borrower
thereunder have been paid in full, and (b) the Lender shall have no further
obligation to make additional loans.

         

        (ii)
“Contract” means a finance lease contract or a secured loan contract with
respect to one or more Vehicles and  includes the rights to all
payments from the Obligor thereunder.

         

        (iii)“Obligor”
means each person obligated to make payments under a Contract and which is the
owner or co-owner of the related Vehicle(s).

         

        (iv)
“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 other entity.

         

        (v)“Registrar
of Titles” means with respect to any state, the governmental agency or body
responsible for the registration of, and the issuance of certificates of title
relating to, motor vehicles and liens thereon.

         

        (vi)“Servicer”
means LEAF Financial Corporation.

        

        
          
            
            

          

          
            Exh.
E-5

            
              

            

          

          
            
            

          

        

         

        (vii)
“State” means one of the fifty states of the United States of America or the
District of Columbia.

         

        (viii)
“Title” means with respect to a Vehicle, (i) if such Vehicle is registered in
Florida, (x) to the extent the related Receivable has been originated by
Funding, an original certificate of title or (y) to the extent the related
Receivable has been originated by a Person other than Funding, (A) an original
certificate of title or (B) if the original certificate of title has been sent
to the registered owner of such Vehicle, an original computer confirmation of
lien, (ii) if such Vehicle is registered in Kansas, a true copy of the
application for certificate of  title and registration, (iii) if such
Vehicle is registered in Kentucky, an original notice of lien, (iv) if such
Vehicle is registered in Maryland, an original notice of security interest
filing, (v) if such Vehicle is registered in Minnesota, an original lien card,
(vi) if such Vehicle is registered in Missouri, an original notice of recorded
lien, (vii) if such Vehicle is registered in Montana, a true copy of the
application for certificate of title, (viii) if such Vehicle is registered in
New York, an original notice of lien, (ix) if such Vehicle is registered in
Oklahoma, an original, file-stamped lien entry form, (x) if such Vehicle is
registered in Wisconsin, an original lien confirmation card or (xi) if such
Vehicle is registered in any other State, an original certificate of title, in
each case issued by the Registrar of Titles of the applicable State listing the
lienholder of record with respect to such Vehicle (it being understood and
agreed that solely for purposes of clauses (i) through
(x) above
(other than clauses
(i)(x) and (i)(y)(A)), the
“original” of any document required thereby shall consist of whatever
documentation has been issued by the Registrar of Titles of the related State to
the lienholder).

         

        (ix)“Vehicle”
means a new or a used automobile, minivan, sports utility vehicle, light duty
truck or heavy duty truck in which Borrower or Funding has acquired an ownership
or security interest.

         

         

        [Signature
page to follow.]

         

         

        
          
            
            

          

          
            Exh.
E-6

            
              

            

          

          
            
            

          

        

            In Witness
Whereof, the parties hereto have duly executed this Agreement as of the date
first above written.

         

         

        
          
            	 	[LIENHOLDER]	 
	 	 	 	 
	
                     

                  	
                    By:
      

                  	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

          

        

         

         

        
           

           

          
            
              	 	RESOURCE CAPITAL FUNDING II,
      LLC, as Borrower	 
	 	 	 	 
	
                       

                    	
                      By:
      

                    	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

            

          

           

           

          
             

            
              
                	 	MORGAN STANLEY BANK, as
      Lender	 
	 	 	 	 
	
                         

                      	
                        By:
      

                      	/s/ 	 
	 	 	Name 	 
	 	 	Title 	 
	 	 	 	 

              

            

          

        

         

         

        
          
            
            

          

          
            Exh.
E-7

            
              

            

          

          
            
            

          

        

        EXHIBIT
F

         

        FORM OF
NOTICE OF BORROWING

         

        NOTICE OF
BORROWING

         

                                                                                                                   __________,
200__

         

        To:           Morgan
Stanley Bank

                   1221
Avenue of the Americas

                   New
York, NY 10020

                   Attn:
Peter Woroniecki

         

        Notice of
Borrowing No.:  [1]

         

        Gentlemen:

         

        Reference
is made to the Receivables Loan and Security Agreement dated as of October 31,
2006 (the “Loan
Agreement”), among Resource Capital Funding II, LLC, (the “Borrower”),
Leaf Financial Corporation, as the Servicer, Morgan Stanley Bank, as Lender,
U.S. Bank National Association, as the Custodian and the Lender’s Bank and Lyon
Financial Services, Inc. (d/b/a U.S. Bank Portfolio Services) as the Backup
Servicer.  Capitalized terms used herein but not defined herein shall
have the meanings assigned to such terms in the Loan Agreement.

         

        In
accordance with Sections 2.02(c) and
6.10(c) of the Loan Agreement, the Borrower hereby certifies that, after
giving effect to the Borrowing requested to occur on __________,
200__:

         

        1.
1. Requested
aggregate amount of
Borrowing:                                                                                     $__________

                   To
be comprised of

         

        a.
a. Requested Pool
A
Loans                                                      $__________

                              and;

         

        b.
b. Requested Pool
B
Loans;                                                      $__________

        2.
2. Requested date
of Borrowing: __________, 200__

        3.
3.
In connection with this
Borrowing we Pledge to you the Eligible Pool A Receivables and the Eligible Pool
B Receivables set forth on the Schedule of Receivables attached
hereto.

         

        
          
            
            

          

          
            Exh.
F-1

            
              

            

          

          
            
            

          

        

         

         

        Payments
in connection with this Borrowing should be deposited to the following
account:  _________________________.

         

        

         

        

         

        

         

        (Signature
page to follow)

         

        
          
            
            

          

          
            Exh.
F-2

            
              

            

          

          
            
            

          

        

         

         

        
          
            	 	 	 
	 	 	 Very
      truly yours	 
	 	 	 	 
	 	 	RESOURCE CAPITAL FUNDING II, LLC       	 
	 	 	 	 
	 	 	 By:                          	 
	 	 	     Name: 
      Miles Herman	 
	 	 	     Title:   
      Vice President	 
	 	 	 	 
	 	 	 	 

          

        

         

         

        
          
            
            

          

          
            Exh.
F-3

            
              

            

          

          
            
            

          

        

        EXHIBIT
G

         

        FORM OF
ALLONGE

         

        (See
attached.)

         

        
           

          
            
              
              

            

            
              Exh.
G-1

              
                

              

            

            
              
              

            

          

        

         

        TABLE OF CONTENTS

         

                                                                                                                                                       
Page

         

        
          	
                  ARTICLE I.

                	
                  DEFINITIONS 

                	
                  1

                

        

         

        
          	
                   
      

                	
                  SECTION
      1.01

                	
                  Certain
      Defined Terms 

                	
                  1

                

        

         

        
          	
                   
      

                	
                  SECTION
      1.02

                	
                  Other
      Terms 

                	
                  3730

                

        

         

        
          	
                   
      

                	
                  SECTION
      1.03

                	
                  Computation
      of Time Periods 

                	
                  3730

                

        

         

        
          	
                  ARTICLE
      II.

                	
                  THE
      RECEIVABLES FACILITY 

                	
                  3730

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.01

                	
                  Borrowings 

                	
                  3730

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.02

                	
                  The
      Initial Borrowing and Subsequent Borrowings 

                	
                  3730

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.03

                	
                  Determination
      of Interest Periods and Interest Rates                                                                           3831

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.04

                	
                  Remittance
      Procedures 

                	
                  3932

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.05

                	
                  Security
      Deposit Account 

                	
                  4334

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.06

                	
                  Cash
      Reserve Account 

                	
                  4435

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.07

                	
                  Payments
      and Computations, Etc 

                	
                  4536

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.08

                	
                  Fees 

                	
                  4637

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.09

                	
                  Increased
      Costs; Capital Adequacy 

                	
                  4637

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.10

                	
                  Collateral
      Assignment of Agreements 

                	
                  4738

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.11

                	
                  Grant
      of a Security Interest 

                	
                  4838

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.12

                	
                  Evidence
      of Debt 

                	
                  4939

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.13

                	
                  Release
      of Pledged Receivables 

                	
                  4939

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.14

                	
                  Treatment
      of Amounts Paid by the Borrower 

                	
                  5039

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.15

                	
                  Prepayment;
      Certain Indemnification Rights; Termination 

                	
                  5039

                

        

         

        
          	
                   
      

                	
                  SECTION
      2.16

                	
                  Increase
      of Borrowing Limit 

                	
                  5140

                

        

         

        
          	
                  ARTICLE
      III.

                	
                  CONDITIONS
      OF LOANS 

                	
                  5140

                

        

         

        
          	
                   
      

                	
                  SECTION
      3.01

                	
                  Conditions
      Precedent to Initial Borrowing 

                	
                  5140

                

        

         

        
          	
                   
      

                	
                  SECTION
      3.02

                	
                  Conditions
      Precedent to All Borrowings 

                	
                  5140

                

        

         

        
          	
                   
      

                	
                  SECTION
      3.03

                	
                  Advances
      Do Not Constitute a Waiver 

                	
                  5442

                

        

         

        
          	
                  ARTICLE
      IV.

                	
                  REPRESENTATIONS
      AND WARRANTIES 

                	
                  5443

                

        

         

        
          	
                   
      

                	
                  SECTION
      4.01

                	
                  Representations
      and Warranties of the Borrower 

                	
                  5443

                

        

         

        
          	
                   
      

                	
                  SECTION
      4.02

                	
                  Representations
      and Warranties of the Servicer 

                	
                  5745

                

        

         

        
          	
                   
      

                	
                  SECTION
      4.03

                	
                  Resale
      of Receivables Upon Breach of Covenant or Representation and Warranty by
      Borrower 

                	
                  6047

                

        

         

        
          	
                   
      

                	
                  SECTION
      4.04

                	
                  Representations
      and Warranties of the Lender 

                	
                  6047

                

        

         

        
          	
                  ARTICLE
      V.

                	
                  GENERAL
      COVENANTS OF THE BORROWER AND THE SERVICER 

                	
                  6047

                

        

         

        
          	
                   
      

                	
                  SECTION
      5.01

                	
                  General
      Covenants 

                	
                  6047

                

        

         

        
          	
                  ARTICLE
      VI.

                	
                  ADMINISTRATION
      AND SERVICING; CERTAIN COVENANTS 

                	
                  6450

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.01

                	
                  Appointment
      and Designation of the Servicer 

                	
                  6450

                

        

        
          
            
            

          

          
            -i-

            
              

            

          

          
            
            

          

        

        TABLE OF CONTENTS

        (continued)

        
                                                                                                                                                         
Page

        

         

        
          	
                   
      

                	
                  SECTION
      6.02

                	
                  Collection
      of Receivable Payments; Modification and Amendment of Receivables; Lockbox
      Agreements 

                	
                  6652

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.03

                	
                  Realization
      Upon Receivables 

                	
                  6752

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.04

                	
                  Insurance
      Regarding Equipment 

                	
                  6752

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.05

                	
                  Maintenance
      of Security Interests in Obligor
      Collateral                                                                                           
      6853

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.06

                	
                  Pledged
      Receivable Receipts 

                	
                  6953

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.07

                	
                  No
      Rights of Withdrawal 

                	
                  6953

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.08

                	
                  Permitted
      Investments 

                	
                  6953

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.09

                	
                  Servicing
      Compensation 

                	
                  7054

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.10

                	
                  Reports
      to the Lender; Account Statements; Servicing
    Information 

                	
                  7054

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.11

                	
                  Statements
      as to Compliance; Financial Statements                                                                                 
      7155

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.12

                	
                  Access
      to Certain Documentation; Obligors; Background Check 

                	
                  7457

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.13

                	
                  Backup
      Servicer 

                	
                  7557

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.14

                	
                  Additional
      Remedies of Lender Upon Event of
      Default                                                                                                          
       7860

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.15

                	
                  Waiver
      of Defaults 

                	
                  7960

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.16

                	
                  Maintenance
      of Certain Insurance 

                	
                  7960

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.17

                	
                  Segregation
      of Collections 

                	
                  7960

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.18

                	
                  UCC
      Matters; Protection and Perfection of Pledged Assets 

                	
                  7960

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.19

                	
                  Servicer
      Advances 

                	
                  8061

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.20

                	
                  Repurchase
      of Receivables Upon Breach of Covenant or Representation and Warranty by
      Servicer 

                	
                  8061

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.21

                	
                  Compliance
      with Applicable Law 

                	
                  8162

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.22

                	
                  Receipt
      of Certificates of Title 

                	
                  8162

                

        

         

        
          	
                   
      

                	
                  SECTION
      6.23

                	
                  Lender’s
      Bank Limitation of Liability 

                	
                  8162

                

        

         

        
          	
                  ARTICLE
      VII.

                	
                  EVENTS
      OF DEFAULT 

                	
                  8263

                

        

         

        
          	
                   
      

                	
                  SECTION
      7.01

                	
                  Events
      of Default 

                	
                  8263

                

        

         

        
          	
                   
      

                	
                  SECTION
      7.02

                	
                  Additional
      Remedies of the Lender 

                	
                  8565

                

        

         

        
          	
                   
      

                	
                  ARTICLE
      VIII.INDEMNIFICATION                                                                                           8665

                

        

         

        
          	
                   
      

                	
                  SECTION
      8.01

                	
                  Indemnities
      by the Borrower 

                	
                  8665

                

        

         

        
          	
                   
      

                	
                  SECTION
      8.02

                	
                  Indemnities
      by Servicer 

                	
                  8867

                

        

         

        
          	
                  ARTICLE
      IX.

                	
                  MISCELLANEOUS 

                	
                  9069

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.01

                	
                  Amendments
      and Waivers 

                	
                  9069

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.02

                	
                  Notices,
      Etc 

                	
                  9069

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.03

                	
                  No
      Waiver; Remedies 

                	
                  9169

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.04

                	
                  Binding
      Effect; Assignability; Multiple Lenders 

                	
                  9169

                

        

         

        
          
            
            

          

          
            -ii-

            
              

            

          

          
            
            

          

        

        
          TABLE OF CONTENTS

          (continued)

          
                                                                                                                                                           
Page

          

        

         

        
          	
                   
      

                	
                  SECTION
      9.05

                	
                  Term
      of This Agreement 

                	
                  9270

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.06

                	
                  GOVERNING
      LAW; JURY WAIVER; CONSENT TO JURISDICTION 

                	
                  9270

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.07

                	
                  Costs,
      Expenses and Taxes 

                	
                  9270

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.08

                	
                  No
      Proceedings 

                	
                  9371

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.09

                	
                  Recourse
      Against Certain Parties 

                	
                  9471

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.10

                	
                  Execution
      in Counterparts; Severability;
      Integration                                                                                                                                                                                                                             
      9472

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.11

                	
                  Tax
      Characterization 

                	
                  9472

                

        

         

        
          	
                   
      

                	
                  SECTION
      9.12

                	
                  Calculation
      of Performance Triggers 

                	
                  9572

                

        

         

        
          	
                  ARTICLE
      X.

                	
                  THE
      COLLATERAL AGENT 

                	
                  9572

                

        

         

        
          	
                   
      

                	
                  SECTION
      10.01

                	
                  No
      Implied Duties 

                	
                  9572

                

        

         

        
          	
                   
      

                	
                  SECTION
      10.02

                	
                  Limits
      on Liability 

                	
                  9672

                

        

         

        
          	
                   
      

                	
                  SECTION
      10.03

                	
                  Acknowledgment

                	
                  96                   Acknowledgement 

                	
                  72

                

        

         

         

        
          
            
            

          

          
            -iii-

            
              

            

          

          
            
            

          

        

        LIST
OF SCHEDULES AND EXHIBITS

         

        
          	
                   
      

                	
                  SCHEDULES

                

        

        
          	
                  SCHEDULE
      I

                	
                  Condition
      Precedent Documents

                

        

        
          	
                  SCHEDULE
      II

                	
                  Prior
      Names, Tradenames, Fictitious Names and “Doing Business As”
      Names

                

        

        
          	
                  SCHEDULE
      III

                	
                  Representations
      and Warranties with Respect to Eligible Receivables, Eligible Underlying
      Contracts and Eligible Underlying
Originators

                

        

        
          	
                  SCHEDULE
      IV

                	
                  Credit
      and Collection Policy

                

        

        
          	
                  SCHEDULE
      V

                	
                  Equipment
      Categories

                

        

        
          	
                  SCHEDULE
      VI

                	
                  Addresses
      for Notice

                

        

         

        

         

        
          	
                   
      

                	
                  EXHIBITS

                

        

        
          	
                  EXHIBIT
      A

                	
                  Form
      of Borrowing Base Certificate

                

        

        
          	
                  EXHIBIT
      B

                	
                  Form
      of Required Data Fields

                

        

        
          	
                  EXHIBIT
      C

                	
                  Form
      of Monthly Remittance Report

                

        

        
          	
                  EXHIBIT
      D-1(a)

                	
                  Form
      of Master Lease Agreement

                

        

        
          	
                  EXHIBIT
      D-1(b)

                	
                  Form
      of Master Lease Schedule (Dollar Purchase
  Option)

                

        

        
          	
                  EXHIBIT
      D-1(c)

                	
                  Form
      of Master Lease Schedule (FMV Purchase
Option)

                

        

        
          	
                  EXHIBIT
      D-1(d)

                	
                  Form
      of Master Lease Schedule (Put)

                

        

        
          	
                  EXHIBIT
      D-1(e)

                	
                  Form
      of Stand Alone Lease Agreement

                

        

        
          	
                  EXHIBIT
      D-2(a)

                	
                  Form
      of Loan Contract

                

        

        
          	
                  EXHIBIT
      D-2(b)

                	
                  Form
      of Loan Contract

                

        

        
          	
                  EXHIBIT D-2(c)

                	
                  Form of Finance
  Agreement

                

        

        
          	
                  EXHIBIT
      D-3

                	
                  Form
      of Practice Acquisition Loan
Contract

                

        

        
          	
                  EXHIBIT
      D-4

                	
                  Eligibility
      Requirements for Pool B Transactions
      (Documentation  Criteria)

                

        

        
          	
                  EXHIBIT
      E

                	
                  Form
      of Vehicle Lienholder Nominee
Agreement

                

        

        
          	
                  EXHIBIT
      F

                	
                  Form
      of Notice of Borrowing

                

        

        
          	
                  EXHIBIT
      G

                	
                  Form
      of Allonge

                

        

        

        

        ivexh10_5.htm

     

    
      

      

    

     

    
      MORGAN
STANLEY BANK

       

      May 23,
2008

       

      Resource
Capital Funding II, LLC

      c/o LEAF
Financial Corporation

      2005
Market Street, 15th
Floor

      Philadelphia,
PA 19103

       

      

       

      Re:           Amended and Restated Fee
Letter

       

      Ladies
and Gentlemen:

       

      Reference
is made to the Receivables Loan and Security Agreement dated as of October 31,
2006 (as such may be amended, restated and/or otherwise modified from time to
time, the “RLSA”) among Resource
Capital Funding II, LLC, as Borrower (the “Borrower”), LEAF
Financial Corporation (“LEAF Financial”), as
Servicer, Morgan Stanley Bank (“Morgan Stanley”) and
the other Lenders party thereto from time to time, U.S. Bank National
Association, as Custodian and the Lender’s Bank, and Lyon Financial Services,
Inc. (d/b/a U.S. Bank Portfolio Services). Terms defined in the RLSA are used in
this amended and restated fee letter (this “Fee Letter”) as
therein defined.

       

      This Fee
Letter is the fee letter referred to in Section 2.08(a) of the RLSA and sets
forth the understanding of the parties hereto with respect to certain fees that
are payable by the Borrower in connection with the financing provided by the
Lenders pursuant to the RLSA. This Fee Letter amends and restates that certain
fee letter, dated as of October 31, 2006, among the parties hereto (the “Existing Fee
Letter”), and after the date hereof, all references in any Transaction
Document to the Fee Letter shall be deemed references to this Fee Letter. This
Fee Letter is not intended to constitute a novation of the Existing Fee Letter,
and all fees that have accrued under the Existing Fee Letter up to the date
hereof shall be payable as and when required in accordance with the terms
thereof.

       

      The
parties hereto agree as follows:

       

      l.           The
Borrower previously has paid to Morgan Stanley four installments of an
Arrangement Fee (as defined in the Existing Fee Letter) on October 15, 2006,
January 15, 2007, April 15, 2007 and July 15, 2007, each in the amount of
$125,000.  LEAF Financial hereby agrees to pay to Morgan Stanley on or
prior to the date hereof, a one-time, up-front, fully-earned and non-refundable
due diligence fee (the “Due Diligence Fee”),
in the amount of $25,000.

       

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      2.           In
consideration of Morgan Stanley executing this Fee Letter, the consent to the
Membership Interest Purchase Agreement, dated on or about the date hereof,
between LEAF Funding, Inc. and LEAF Commercial Finance Fund, LLC, and the fifth
amendment to the RLSA, dated as of the date hereof, the Borrower hereby agrees
to pay to Morgan Stanley an amendment fee in the amount of $500,000 (the “Amendment Fee”),
which such fee shall have been earned, in its entirety, as of the date
hereof.  The Amendment Fee is payable in two (2) equal installments
according to the following schedule:  1st payment
of $250,000 (the “First Installment”)
on or prior to the date hereof; and 2nd payment
of $250,000 on or prior to June 30, 2008.

       

      3.           The
Borrower hereby agrees that, in the event that the Lender increases the
Borrowing Limit pursuant to Section 2.16 of the RLSA, the Borrower shall pay to
the Agent, for its own account, immediately prior to the effectiveness of such
increase, a fee (the “Increase Fee”) in an
amount equal to 0.20% of the principal amount of such increase, which such fee
shall have been earned, in its entirety, on the date of such
increase.

       

      4.           (a)           During
the period commencing on the date hereof and ending on the Collection Date, the
Borrower shall pay Morgan Stanley, a fee (the “Unused Fee”) in
respect of each Fee Period (other than the Fee Period commencing on the date
hereof and the five following Fee Periods) which shall be equal to (A) 0.10%, if
the Facility Amount is equal to or less than $100,000,000, and 0.25%, if the
Facility Amount is greater than $100,000,000, multiplied by (B) an
amount equal to (i) the Borrowing Limit (or, if more than one Borrowing Limit
was in effect during such Fee Period, the daily average Borrowing Limit) in
effect during such Fee Period minus (ii) the daily
average Facility Amount during such Fee Period, as determined by the Lender,
multiplied by
(C) a fraction, the numerator of which shall be the actual number of days in
such Fee Period and the denominator of which shall be 360 days.

       

      (b)           The
Unused Fee shall be payable by the Borrower in arrears on each Remittance Date
commencing on the seventh (7th)
Remittance Date after the Closing Date with respect to the Fee Period
immediately preceding such Remittance Date, and on the Collection
Date.  The Unused Fee shall not be payable with respect to any Fee
Period during interest in respect of the Loans Outstanding is computed by
reference to the Default Funding Rate.

       

      5.           If
the Borrower exercises its right to prepay, in whole or in part, the outstanding
principal amount of the Loans in accordance with Section 2.15 of the RLSA, the
Borrower shall pay Morgan Stanley a fee (the “Prepayment Premium”)
in an amount equal to 0.50% multiplied by the
principal amount of the Loans then being prepaid.  Notwithstanding the
foregoing, such Prepayment Premium shall be credited against any fees paid to
Morgan Stanley in connection with a securitization transaction.

       

      6.           Whenever
any payment hereunder shall be due on a day other than a Business Day, such
payment shall be made on the next succeeding Business Day and such extension of
time shall be included in the computation of such payment; provided, that no day
shall be included in more than one Fee Period.

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      7.           For
all purposes under the RLSA, “Adjusted Eurodollar Rate
Margin” shall mean (a) prior to June 1, 2008, (i) 0.60% per annum on the
portion of the Facility Amount equal to or less than $100,000,000 and (ii) 0.75%
per annum on the portion of the Facility Amount in excess of $100,000,000 (if
any), and (b) on and after June 1, 2008, 1.15% per annum on the Facility
Amount.

       

      8.           Unless
otherwise required by applicable law, each party hereto agrees to maintain the
confidentiality of this Fee Letter in communications with third parties and
otherwise; provided, that, this
Fee Letter may be disclosed by each party to its respective legal counsel and
auditors, any rating agency and any provider of liquidity support or credit
enhancement, if they agree to hold it confidential. The terms and provisions of
this Fee Letter shall be binding upon, and shall inure to the benefit of, the
successors and assigns of the parties hereof. THIS FEE LETTER SHALL, IN
ACCORDANCE WITH SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF
NEW YORK, BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO
ANY CONFLICTS OF LAW PRINCIPLES THEREOF THAT WOULD CALL FOR THE APPLICATION OF
THE LAWS OF ANY OTHER JURISDICTION.

       

      [Remainder
of page intentionally left blank.]

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      This Fee
Letter 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. Delivery of an executed counterpart of a signature page to this Fee
Letter by facsimile shall be effective as delivery of a manually executed
counterpart of this Fee Letter.

       

      Very
truly yours,

      

       

      MORGAN
STANLEY BANK, as Lender

       

      By:           ________________________________

       

      Name:

       

      Title:

       

      Agreed
and accepted as of

       

      the date
first above written:

       

      RESOURCE
CAPITAL FUNDING II, LLC,

      as
Borrower

      

      

      By:           ___________________________

       

      Name:

       

      Title:

       

      

       

      LEAF
FINANCIAL CORPORATION

      

      

      By:           ___________________________

       

      Name:

       

      Title:

       

       

      S-1

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