Document:

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                                                                    EXHIBIT 10.4

                                                                  EXECUTION COPY

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                            ADMINISTRATION AGREEMENT

                                  by and among

                            WILMINGTON TRUST COMPANY,
         not in its individual capacity but solely as Owner Trustee for
                      Capital One Auto Finance Trust 2001-A

                                    as Issuer

                         CAPITAL ONE AUTO FINANCE, INC.

                                as Administrator

                                       and

                 WELLS FARGO BANK MINNESOTA NATIONAL ASSOCIATION

                              as Indenture Trustee

                            Dated as of July 26, 2001

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                                TABLE OF CONTENTS

<TABLE>
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                                                                                              Page
<S>               <C>                                                                         <C>
Section 1.        Definitions and Usage..........................................................1

Section 2.        Duties of the Administrator....................................................2

Section 3.        Records........................................................................9

Section 4.        Compensation...................................................................9

Section 5.        Additional Information To Be Furnished to the Issuer...........................9

Section 6.        Independence of the Administrator..............................................9

Section 7.        No Joint Venture..............................................................10

Section 8.        Other Activities of Administrator.............................................10

Section 9.        Term of Agreement; Resignation and Removal of Administrator...................10

Section 10.       Action upon Termination, Resignation or Removal...............................11

Section 11.       Notices.......................................................................11

Section 12.       Amendments....................................................................12

Section 13.       Successors and Assigns........................................................13

Section 14.       Governing Law.................................................................13

Section 15.       Headings......................................................................13

Section 16.       Counterparts..................................................................14

Section 17.       Severability..................................................................14

Section 18.       Not Applicable to Capital One Auto Finance in Other Capacities................14

Section 19.       Limitation of Liability of Owner Trustee and Indenture Trustee................14

Section 20.       Third-Party Beneficiary.......................................................14

Section 21.       Nonpetition Covenants.........................................................14
</TABLE>

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                            ADMINISTRATION AGREEMENT

         This ADMINISTRATION AGREEMENT, dated as of July 26, 2001 (as from time
to time amended, supplemented or otherwise modified and in effect, this
"Agreement"), is by and among WILMINGTON TRUST COMPANY, not in its individual
capacity but solely as Owner Trustee for Capital One Auto Finance Trust 2001-A,
a Delaware common law trust (the "Owner Trustee"), CAPITAL ONE AUTO FINANCE,
INC., a Texas corporation, as administrator (the "Administrator"), and WELLS
FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, a national banking association, not
in its individual capacity but solely as Indenture Trustee (the "Indenture
Trustee").

         WHEREAS, the Owner Trustee is issuing the Notes pursuant to the
Indenture and the Certificates pursuant to the Trust Agreement and has entered
into certain agreements in connection therewith, including (i) the Contribution
Agreement, (ii) the Note Depository Agreement, (iii) the Indenture, (iv) the
Servicing Agreement and (v) the Insurance Agreement (the Contribution Agreement,
the Note Depository Agreement, the Indenture, the Servicing Agreement, the
Insurance Agreement and the Administration Agreement being referred to
hereinafter collectively as the "Related Agreements");

         WHEREAS, the Owner Trustee desires to have the Administrator perform
certain duties of the Owner Trustee and the Owner Trustee under the Related
Agreements and to provide such additional services consistent with the terms of
this Agreement and the Related Agreements as the Owner Trustee and the Owner
Trustee may from time to time request; and

         WHEREAS, the Administrator has the capacity to provide the services
required hereby and is willing to perform such services for the Owner Trustee
and the Owner Trustee on the terms set forth herein;

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

         Section 1. Definitions and Usage.

         (a) Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined herein are
defined in the Indenture.

         (b) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document delivered pursuant hereto unless
otherwise defined therein. For purposes of this Agreement and all such
certificates and other documents, unless the context otherwise requires:

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(i) accounting terms not otherwise defined in this Agreement, and accounting
terms partly defined in this Agreement to the extent not defined, shall have the
respective meanings given to them under generally accepted accounting
principles; (ii) terms defined in Article 9 of the UCC as in effect in the State
of Delaware and not otherwise defined in this Agreement are used as defined in
that Article; (iii) the words "hereof," "herein" and "hereunder" and words of
similar import refer to this Agreement as a whole and not to any particular
provision of this Agreement; (iv) references to any Article, Section, Schedule
or Exhibit are references to Articles, Sections, Schedules and Exhibits in or to
this Agreement, and references to any paragraph, subsection, clause or other
subdivision within any Section or definition refer to such paragraph,
subsection, clause or other subdivision of such Section or definition; (v) the
term "including" means "including without limitation"; (vi) references to any
law or regulation refer to that law or regulation as amended from time to time
and include any successor law or regulation; (vii) references to any Person
include that Person's successors and assigns; and (viii) headings are for
purposes of reference only and shall not otherwise affect the meaning or
interpretation of any provision hereof.

         Section 2. Duties of the Administrator.

         (a) Duties with Respect to the Indenture and the Note Depository
Agreement.

             (i) The Administrator agrees to perform all of its duties as
Administrator and the duties of the Owner Trustee under the Note Depository
Agreement. In addition, the Administrator shall consult with the Owner Trustee
regarding the duties of the Owner Trustee under the Indenture and the Note
Depository Agreement.

             (ii) The Administrator shall monitor the performance of the Owner
Trustee and shall advise the Owner Trustee when action is necessary to comply
with the Owner Trustee's duties under the Indenture and the Note Depository
Agreement.

             (iii) The Administrator shall prepare for execution by the Owner
Trustee, or shall cause the preparation by appropriate persons of, all such
documents, reports, filings, instruments, certificates and opinions that shall
be the duty of the Owner Trustee to prepare, file or deliver pursuant to the
Indenture and the Note Depository Agreement.

             (iv) In furtherance of the foregoing, the Administrator shall take
all appropriate action that is the duty of the Owner Trustee to take pursuant to
the Indenture including, without limitation, such of the foregoing as are
required with respect to the following matters under the Indenture (references
are to sections of the Indenture):

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                  (A) the duty to cause the Note Register to be kept and to give
         the Indenture Trustee notice of any appointment of a new Note Registrar
         and the location, or change in location, of the Note Register (Section
         2.07);

                  (B) the preparation of or obtaining of the documents and
         instruments required for authentication of the Notes and delivery of
         the same to the Indenture Trustee (Section 2.05);

                  (C) the preparation, obtaining or filing of the instruments,
         opinions and certificates and other documents required for the release
         of property from the lien of the Indenture (Section 2.18);

                  (D) the preparation of Definitive Notes in accordance with the
         instructions of the Clearing Agency (Section 2.13);

                  (E) the duty to cause newly appointed Note Paying Agents, if
         any, to deliver to the Indenture Trustee the instrument specified in
         the Indenture regarding funds held in trust (Section 3.03);

                  (F) the direction to the Indenture Trustee to deposit monies
         with Note Paying Agents, if any, other than the Indenture Trustee
         (Section 3.03);

                  (G) the obtaining and preservation of the Owner Trustee's
         qualification to do business in each jurisdiction in which such
         qualification is or shall be necessary to protect the validity and
         enforceability of the Indenture, the Notes, the Trust Property and each
         other instrument or agreement included in the Trust Estate (Section
         3.12(a));

                  (H) the preparation of all supplements and amendments to the
         Indenture and all financing statements, continuation statements,
         instruments of further assurance and other instruments and the taking
         of such other action as is necessary or advisable to protect the Trust
         Estate (Section 3.05);

                  (I) the delivery of the Opinion of Counsel on the Closing Date
         and the annual delivery of Opinions of Counsel as to the Trust Estate,
         and the annual delivery of the Officer's Certificate and certain other
         statements as to compliance with the Indenture (Sections 3.06 and
         3.07);

                  (J) the identification to the Indenture Trustee in an
         Officer's Certificate of any Person with whom the Owner Trustee has
         contracted to perform its duties under the Indenture (Section 3.01(b));

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                  (K) the notification of the Indenture Trustee and the Rating
         Agencies of an Event of Servicing Default under the Servicing Agreement
         and, if such Event of Servicing Termination arises from the failure of
         the Servicer to perform any of its duties under the Servicing Agreement
         with respect to the Receivables, the taking of all reasonable steps
         available to remedy such failure (Section 4.01(c));

                  (L) the preparation and obtaining of documents and instruments
         required for the transfer by the Owner Trustee of its properties or
         assets (Section 3.10(b)(ii));

                  (M) the duty to cause the Servicer to comply with Sections
         2.09, 2.10, 2.11, 2.21 and 3.02 of the Servicing Agreement (Section
         3.01(g));

                  (N) the delivery of written notice to the Indenture Trustee
         and the Rating Agencies of each Event of Default under the Indenture
         and each Event of Servicing Default by the Servicer or the Seller under
         the Servicing Agreement (Section 7.02);

                  (O) the monitoring of the Owner Trustee's obligations as to
         the satisfaction and discharge of the Indenture and the preparation of
         an Officer's Certificate and the obtaining of the Opinions of Counsel
         and the Independent Certificate relating thereto (Section 3.01);

                  (P) the monitoring of the Owner Trustee's obligations as to
         the satisfaction, discharge and defeasance of the Notes and the
         preparation of an Officer's Certificate and the obtaining of an opinion
         of a nationally recognized firm of independent certified public
         accountants, a written confirmation thereof and the Opinions of Counsel
         relating thereto (Section 3.01);

                  (Q) the preparation and delivery of an Officer's Certificate
         to the Indenture Trustee after the occurrence of any event which with
         the giving of notice and the lapse of time would become an Event of
         Default under Section 5.1(c) of the Indenture, its status and what
         action the Owner Trustee is taking or proposes to take with respect
         thereto (Section 9.01);

                  (R) the compliance with any written directive of the Indenture
         Trustee with respect to the sale of the Trust Estate at one or more
         public or private sales called and conducted in any manner permitted by
         law if an Event of Default shall have occurred and be continuing
         (Section 9.04);

                  (S) the preparation and delivery of notice to Noteholders of
         the removal of the Indenture Trustee and the appointment of a successor
         Indenture Trustee (Section 7.10);

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                  (T) the preparation of any written instruments required to
         confirm more fully the authority of any co-trustee or separate trustee
         and any written instruments necessary in connection with the
         resignation or removal of any co-trustee or separate trustee (Sections
         7.10 and 7.13);

                  (U) the furnishing of the Indenture Trustee with the names and
         addresses of Noteholders during any period when the Indenture Trustee
         is not the Note Registrar (Section 12.01);

                  (V) the preparation and, after execution by the Owner Trustee,
         the filing with the Commission, any applicable state agencies and the
         Indenture Trustee of documents required to be filed on a periodic basis
         with, and summaries thereof as may be required by rules and regulations
         prescribed by, the Commission and any applicable state agencies and the
         transmission of such summaries, as necessary, to the Noteholders
         (Section 12.03);

                  (W) the preparation and delivery of Owner Trustee Orders,
         Officer's Certificates and Opinions of Counsel and all other actions
         necessary with respect to investment and reinvestment, to the extent
         permitted, of funds in such accounts (Sections 5.01, 5.04, 5.05, 5.06,
         5.08 and 5.10);

                  (X) the preparation of an Owner Trustee Request and Officer's
         Certificate and the obtaining of an Opinion of Counsel and Independent
         Certificates, if necessary, for the release of the Trust Estate
         (Section 5.14);

                  (Y) the preparation of Owner Trustee Orders and the obtaining
         of Opinions of Counsel with respect to the execution of supplemental
         indentures and the mailing to the Noteholders of notices with respect
         to such supplemental indentures (Sections 10.01, 10.02, 10.03 and
         10.04);

                  (Z) the execution and delivery of new Notes conforming to any
         supplemental indenture (Section 10.06);

                  (AA) directing the Owner Trustee to redeem the Notes (Section
         6.02);

                  (BB) the notification of Noteholders of redemption of the
         Notes or duty to cause the Indenture Trustee to provide such
         notification (Section 6.03);

                  (CC) the preparation and delivery of all Officer's
         Certificates and the obtaining of Opinions of Counsel and Independent
         Certificates with respect to any requests by

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         the Owner Trustee to the Indenture Trustee to take any action under the
         Indenture (Section 13.01(a));

                  (DD) the preparation and delivery of Officer's Certificates
         and the obtaining of Independent Certificates, if necessary, for the
         release of property from the lien of the Indenture (Section 13.01(b));

                  (EE) the notification of the Rating Agencies, upon the failure
         of the Indenture Trustee to give such notification, of the information
         required pursuant to Section 13.04 of the Indenture (Section 13.04);

                  (FF) the recording of the Indenture, if applicable (Section
         13.16), and

                  (GG) all other duties of the Owner Trustee under the
         Indenture.

             (v) Payment of Fees and Indemnification by the Administrator.

             The Administrator will:

                  (A) pay the Indenture Trustee from time to time reasonable
         compensation for all services rendered by the Indenture Trustee under
         the Indenture (which compensation shall not be limited by any provision
         of law in regard to the compensation of a trustee of an express trust)
         pursuant to the terms of the Indenture Trustee Fee Letter dated July
         26, 2001;

                  (B) The Administrator agrees to pay to each agent of the
         Indenture Trustee from time to time reasonable compensation for its
         services as agreed upon between such agent and the Administrator.

                  (C) except as otherwise expressly provided in the Indenture,
         reimburse the Indenture Trustee upon its request for all reasonable
         expenses, disbursements and advances incurred or made by the Indenture
         Trustee in accordance with any provision of the Indenture (including
         the reasonable compensation, expenses and disbursements of such agents
         and counsel as Indenture Trustee may employee in connection with the
         exercise and performance of its rights and its duties under the
         Indenture), except any such expense, disbursement or advance as may be
         attributable to its gross negligence;

                  (D) indemnify the Indenture Trustee (individually and in its
         capacity as such) and its successors, assigns, directors, officers,
         employees and agents against any and all loss, liability or expense
         (including attorneys' fees and expenses) incurred by it in connection
         with the acceptance or the administration of the trust created under
         the Indenture and the performance

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         of its duties thereunder; provided, however, that the Administrator
         shall not be liable for or required to indemnify Indenture Trustee from
         and against any of the foregoing expenses arising or resulting from
         Indenture Trustee's own gross negligence or to the extent arising from
         the breach by Indenture Trustee of any of its representations and
         warranties and covenants set forth in the Indenture;

                  (E) pay to Owner Trustee from time to time reasonable
         compensation for all services rendered by Owner Trustee under the Trust
         Agreement (which compensation shall not be limited by any provision of
         law in regard to the compensation of a trustee of an express trust)
         pursuant to the terms of the Owner Trustee Fee Letter dated July 26,
         2001;

                  (F) except as otherwise expressly provided for in the Trust
         Agreement, reimburse Owner Trustee upon its request for all reasonable
         expenses, disbursements and advances incurred or made by Owner Trustee
         in accordance with any provision of the Trust Agreement (including the
         reasonable compensation, expenses and disbursements of such agents and
         counsel as Owner Trustee may employee in connection with the exercise
         and performance of its rights and its duties under the Trust
         Agreement), except any such expense may be attributable to its willful
         misconduct, negligence or bad faith.

                  (G) indemnify Owner Trustee (individually and in its capacity
         as such) and its successors, assigns, directors, officers, employees
         and agents from and against, any and all loss, liability, expense, tax,
         penalty or claim (including reasonable legal fees and expenses) of any
         kind and nature whatsoever which may at any time be imposed on,
         incurred by, or asserted against Owner Trustee or any Indemnified Party
         in any way relating to or arising out of the Trust Agreement, the
         Transaction Documents, the Owner Trust Estate, the administration of
         the Owner Trust Estate or the action or inaction of Owner Trustee under
         the Trust Agreement, provided, however, that the Administrator shall
         not be liable for or required to indemnify Owner Trustee from and
         against any of the foregoing expenses arising or resulting from any of
         the matters described in the third sentence of Section 7.1 of the Trust
         Agreement.

         Indemnification under this subsection shall survive the resignation or
         removal of the Owner Trustee or the Indenture Trustee and the
         termination of this Agreement or any other Transaction Document. If any
         suit, action, proceeding (including any governmental or regulatory
         investigation), claim or demand shall be brought or asserted against
         any Person in respect of which indemnity may be sought pursuant to this
         Section, such Person (the "Indemnified Person") shall promptly notify
         Administrator in writing, and Administrator, upon request of the
         Indemnified Person, shall retain counsel reasonably satisfactory to the
         Indemnified Person to represent the Indemnified Person and any others
         Administrator designates in such proceeding and shall pay the
         reasonable fees and expenses of such counsel related to such
         proceeding. Administrator shall not be liable for any settlement of any
         claim or proceeding effected without

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         its written consent, but if settled with such consent or if there be a
         final judgment for the plaintiff, Administrator agrees to indemnify any
         Indemnified Person from and against any loss or liability by reason of
         such settlement or judgment. Administrator shall not, without the prior
         written consent of the Indemnified Person, effect any settlement of any
         pending or threatened proceeding in respect of which any Indemnified
         Person is or could have been a party and indemnity could have been
         sought hereunder by such Indemnified Person, unless such settlement
         includes an unconditional release of such Indemnified Person from all
         liability on claims that are the subject matter of such proceeding. If
         Administrator shall have made any indemnity payments pursuant to this
         subsection and the Person to or on behalf of whom such payments are
         made thereafter shall collect any of such amounts from others, such
         Person shall promptly repay such amounts to Administrator, without
         interest.

         (b) Additional Duties. (i) In addition to the duties of the
Administrator set forth above, the Administrator shall perform such calculations
and shall prepare or shall cause the preparation by other appropriate persons
of, and shall execute on behalf of the Owner Trustee or the Owner Trustee, all
such documents, reports, filings, instruments, certificates and opinions that it
shall be the duty of the Owner Trustee or the Owner Trustee to prepare, file or
deliver pursuant to the Related Agreements, and at the request of the Owner
Trustee shall take all appropriate action that it is the duty of the Owner
Trustee or the Owner Trustee to take pursuant to the Related Agreements and
shall monitor the performance of the Owner Trustee and shall advise the Owner
Trustee when action is necessary to comply with the Owner Trustee duties under
the Related Agreements. Subject to Section 5 of this Agreement, and in
accordance with the directions of the Owner Trustee, the Administrator shall
administer, perform or supervise the performance of such other activities in
connection with the Collateral as are not covered by any of the foregoing
provisions and as are expressly requested by the Owner Trustee and are
reasonably within the capability of the Administrator:

             (i) Notwithstanding anything in this Agreement or the Related
Agreements to the contrary, the Administrator shall be responsible for promptly
notifying the Owner Trustee in the event that any withholding tax is imposed on
the Owner Trustee's payments (or allocations of income) to a Certificateholder
as contemplated in Section 5.2(c) of the Trust Agreement. Any such notice shall
specify the amount of any withholding tax required to be withheld by the Owner
Trustee pursuant to such provision.

             (ii) Notwithstanding anything in this Agreement or the Related
Agreements to the contrary, the Administrator shall be responsible for
performance of the duties of the Trust or the Owner Trustee set forth in
Sections 5.5(a), (b), (c), (d) and (e), 5.6(a) and 9.1 of the Trust Agreement
and Sections 2.04(b), 2.07, 3.01(c) and 5.04 of the Servicing Agreement, with
respect to, among other things, accounting and reports to Certificateholders.

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             (iii) The Administrator will provide prior to November 15, 2001, a
certificate of an Authorized Officer in form and substance satisfactory to the
Owner Trustee as to whether any tax withholding is then required and, if
required, the procedures to be followed with respect thereto to comply with the
requirements of the Code. The Administrator shall be required to update the
letter in each instance that any additional tax withholding is subsequently
required or any previously required tax withholding shall no longer be required.

             (iv) The Administrator shall perform the duties of the
Administrator specified in Section 10.2 of the Trust Agreement required to be
performed in connection with the resignation or removal of the Owner Trustee,
and any other duties expressly required to be performed by the Administrator
pursuant to the Trust Agreement.

             (v) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Administrator may enter into transactions
or otherwise deal with any of its Affiliates; provided, however, that the terms
of any such transactions or dealings shall be in accordance with any directions
received from the Owner Trustee and shall be, in the Administrator's opinion, no
less favorable to the Owner Trustee than would be available from unaffiliated
parties.

         (c) Non-Ministerial Matters. With respect to matters that in the
reasonable judgment of the Administrator are non-ministerial, the Administrator
shall not take any action unless within a reasonable time before the taking of
such action, the Administrator shall have notified the Owner Trustee of the
proposed action and the Owner Trustee shall not have withheld consent or
provided an alternative direction. For the purpose of the preceding sentence,
"non-ministerial matters" shall include, without limitation:

                  (A) the amendment of or any supplement to the Indenture;

                  (B) the initiation of any claim or lawsuit by the Owner
         Trustee and the compromise of any action, claim or lawsuit brought by
         or against the Owner Trustee (other than in connection with the
         collection of the Receivables or Permitted Investments);

                  (C) the amendment, change or modification of the Related
         Agreements;

                  (D) the appointment of successor Note Registrars, successor
         Paying Agents and successor Indenture Trustees pursuant to the
         Indenture or the appointment of successor Administrators or Successor
         Servicers, or the consent to the assignment by the Note Registrar,
         Paying Agent or Indenture Trustee of its obligations under the
         Indenture; and

                  (E) the removal of the Indenture Trustee.

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             (ii) Notwithstanding anything to the contrary in this Agreement,
the Administrator shall not be obligated to, and shall not, (x) make any
payments to the Noteholders under the Related Agreements, (y) sell the Trust
Estate pursuant to Section 9.04 of the Indenture or (z) take any other action
that the Owner Trustee directs the Administrator not to take on its behalf.

         Section 3. Records. The Administrator shall maintain appropriate books
of account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Owner Trustee and
the Seller at any time during normal business hours.

         Section 4. Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement and, as reimbursement for its
expenses related thereto, the Administrator shall be entitled to $2,500 annually
which shall be solely an obligation of the Servicer.

         Section 5. Additional Information To Be Furnished to the Owner Trustee.
The Administrator shall furnish to the Owner Trustee from time to time such
additional information regarding the Collateral as the Owner Trustee shall
reasonably request.

         Section 6. Independence of the Administrator. For all purposes of this
Agreement, the Administrator shall be an independent contractor and shall not be
subject to the supervision of the Owner Trustee, the Owner Trustee or the
Indenture Trustee with respect to the manner in which it accomplishes the
performance of its obligations hereunder. Unless expressly authorized by the
Owner Trustee, the Administrator shall have no authority to act for or represent
the Owner Trustee or the Owner Trustee (and, regardless of whether authorized by
the Owner Trustee, the Administrator shall have no such authority at all with
respect to the Indenture Trustee) in any way and shall not otherwise be deemed
an agent of the Owner Trustee, the Owner Trustee or the Indenture Trustee.

         Section 7. No Joint Venture. Nothing contained in this Agreement shall
constitute the Administrator and either of the Owner Trustee or the Owner
Trustee as members of any partnership, joint venture, association, syndicate,
unincorporated business or other separate entity, shall be construed to impose
any liability as such on any of them or shall be deemed to confer on any of them
any express, implied or apparent authority to incur any obligation or liability
on behalf of the others.

         Section 8. Other Activities of Administrator. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Owner Trustee, the
Owner Trustee or the Indenture Trustee.

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         Section 9. Term of Agreement; Resignation and Removal of Administrator.

         (a) This Agreement shall continue in force until the dissolution of the
Owner Trustee, upon which event this Agreement shall automatically terminate.

         (b) Subject to Sections 9(e) and 9(f), the Administrator may resign its
duties hereunder by providing the Owner Trustee with at least sixty (60) days'
prior written notice.

         (c) Subject to Sections 9(e) and 9(f), the Owner Trustee may remove the
Administrator without cause by providing the Administrator with at least sixty
(60) days' prior written notice.

         (d) Subject to Sections 9(e) and 9(f), at the sole option of the Owner
Trustee, the Administrator may be removed immediately upon written notice of
termination from the Owner Trustee to the Administrator if any of the following
events shall occur:

             (i) the Administrator shall default in the performance of any of
its duties under this Agreement and, after notice of such default, shall not
cure such default within ten (10) days (or, if such default cannot be cured in
such time, shall not give within ten (10) days such assurance of cure as shall
be reasonably satisfactory to the Owner Trustee);

             (ii) a court having jurisdiction in the premises shall enter a
decree or order for relief, and such decree or order shall not have been vacated
within sixty (60) days, in respect of the Administrator in any involuntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect or appoint a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official for the Administrator or any
substantial part of its property or order the winding-up or liquidation of its
affairs; or

             (iii) the Administrator shall commence a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, shall consent to the entry of an order for relief in an involuntary case
under any such law, shall consent to the appointment of a receiver, liquidator,
assignee, trustee, custodian, sequestrator or similar official for the
Administrator or any substantial part of its property, shall consent to the
taking of possession by any such official of any substantial part of its
property, shall make any general assignment for the benefit of creditors or
shall fail generally to pay its debts as they become due.

         The Administrator agrees that if any of the events specified in clauses
(ii) or (iii) of this Section 9(d) shall occur, it shall give written notice
thereof to the Owner Trustee and the Owner Trustee within seven (7) days after
the happening of such event.

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         (e) No resignation or removal of the Administrator pursuant to this
Section 9 shall be effective until (1) a successor Administrator shall have been
appointed by the Owner Trustee and (2) such successor Administrator shall have
agreed in writing to be bound by the terms of this Agreement in the same manner
as the Administrator is bound hereunder.

         (f) The appointment of any successor Administrator shall be effective
only after approval by the Rating Agencies with respect to the proposed
appointment.

         (g) Subject to Sections 9(e) and 9(f), the Administrator acknowledges
that upon the appointment of a successor Servicer pursuant to the Servicing
Agreement, the Administrator shall immediately resign and such successor
Servicer shall automatically become the Administrator under this Agreement.

         Section 10. Action upon Termination, Resignation or Removal. Promptly
upon the effective date of termination of this Agreement pursuant to Section
9(a) or the resignation or removal of the Administrator pursuant to Section 9(b)
or (c), respectively, the Administrator shall be entitled to be paid all fees
and reimbursable expenses accruing to it to the date of such termination,
resignation or removal. The Administrator shall forthwith upon such termination
pursuant to Section 9(a) deliver to the Owner Trustee all property and documents
of or relating to the Collateral then in the custody of the Administrator. In
the event of the resignation or removal of the Administrator pursuant to Section
9(b) or (c), respectively, the Administrator shall cooperate with the Owner
Trustee and the Indenture Trustee and take all reasonable steps requested to
assist the Owner Trustee in making an orderly transfer of the duties of the
Administrator.

         Section 11. Notices. Any notice, report or other communication given
hereunder shall be in writing and addressed as follows:

         (a) if to the Owner Trustee or the Owner Trustee, to:

                  Wilmington Trust Company
                  Rodney Square North
                  1100 North Market Street
                  Wilmington, Delaware 19890-0001
                  Attention:  Don MacKelcan
                  Telephone:  (302) 651-1119
                  Facsimile:  (302) 651-1576

                  With a copy to:

                  Mayer, Brown & Platt
                  190 S. LaSalle Street
                  Chicago, IL  60603
                  Attention:  Stuart M. Litwin
                  Telephone:  (312) 782-0600
                  Facsimile:  (312) 701-7711

                                       12
<PAGE>   15

         (b) if to the Administrator, to:

                  Capital One Auto Finance, Inc.
                  8000 Jones Branch Drive
                  McLean, Virginia 22102
                  Attention:  Director of Securitization
                  Telephone: (703) 875-1305
                  Facsimile:  (703) 875-1389

         (c) If to the Indenture Trustee, to:

                  Wells Fargo Bank Minnesota, National Association
                  6th Street and Marquette Avenue
                  Minneapolis, Minnesota 55479
                  Attention: Corporate Trust Services -
                             Asset Backed Administration
                  Telephone: (612) 667-8058
                  Facsimile:  (612) 667-3539

or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if such notice is mailed by certified mail, postage prepaid, or hand-delivered
to the address of such party as provided above.

         Section 12. Amendments. This Agreement may be amended from time to time
by a written amendment duly executed and delivered by the Owner Trustee, the
Administrator and the Indenture Trustee, with the written consent of the Owner
Trustee, without the consent of the Noteholders and the Certificateholders, for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Agreement or of modifying in any manner the rights
of the Noteholders or Certificateholders; provided that, unless the Rating
Agency Condition shall have been satisfied, such amendment will not, materially
and adversely affect the interest of any Noteholder or Certificateholder. This
Agreement may also be amended by the Owner Trustee, the Administrator and the
Indenture Trustee for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of Noteholders or the Certificateholders; provided,
however, that no such amendment may increase or reduce in any manner the amount
of, or accelerate or delay the timing of, collections of payments on Receivables
or distributions that are required to be made for the benefit of the Noteholders
or Certificateholders

                                       13
<PAGE>   16

without the consent of the Noteholders of all the Notes Outstanding and
Certificateholders of Certificates evidencing all the Certificate Balance.
Notwithstanding the foregoing, the Administrator may not amend this Agreement
without the consent of the Seller, which permission shall not be unreasonably
withheld.

         Section 13. Successors and Assigns. This Agreement may not be assigned
by the Administrator unless such assignment is previously consented to in
writing by the Owner Trustee, the Owner Trustee and the Indenture Trustee and
subject to the satisfaction of the Rating Agency Condition in respect thereof.
An assignment with such consent and satisfaction, if accepted by the assignee,
shall bind the assignee hereunder in the same manner as the Administrator is
bound hereunder. Notwithstanding the foregoing, this Agreement may be assigned
by the Administrator without the consent of the Owner Trustee, the Owner Trustee
or the Indenture Trustee to a corporation or other organization that is a
successor (by merger, consolidation or purchase of assets) to the Administrator;
provided that such successor organization executes and delivers to the Owner
Trustee, the Owner Trustee and the Indenture Trustee an agreement in which such
corporation or other organization agrees to be bound hereunder by the terms of
said assignment in the same manner as the Administrator is bound hereunder.
Subject to the foregoing, this Agreement shall bind any successors or assigns of
the parties hereto.

         Section 14. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.

         Section 15. Headings. The Section headings hereof have been inserted
for convenience of reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.

         Section 16. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall be an original, but all of
which together shall constitute but one and the same agreement.

         Section 17. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.

         Section 18. Not Applicable to Capital One Auto Finance, Inc. in Other
Capacities. Nothing in this Agreement shall affect any right or obligation
Capital One Auto Finance, Inc. may have in any other capacity.

                                       14
<PAGE>   17

         Section 19. Limitation of Liability of Owner Trustee and Indenture
Trustee. (a) Notwithstanding anything contained herein to the contrary, this
instrument has been countersigned by Wilmington Trust Company not in its
individual capacity but solely in the capacity as Owner Trustee of the Owner
Trustee and in no event shall Wilmington Trust Company in its individual
capacity or any beneficial owner of the Owner Trustee have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Owner Trustee hereunder, as to all of which recourse shall be had solely to the
assets of the Owner Trustee. For all purposes of this Agreement, in the
performance of any duties or obligations of the Owner Trustee hereunder, the
Owner Trustee shall be subject to, and entitled to the benefits of, the terms
and provisions of Articles VI, VII and VIII of the Trust Agreement.

         (b) Notwithstanding anything contained herein to the contrary, this
Agreement has been countersigned by Wells Fargo Bank Minnesota, National
Association not in its individual capacity but solely as Indenture Trustee and
in no event shall Indenture Trustee have any liability for the representations,
warranties, covenants, agreements or other obligations of the Owner Trustee
hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Owner Trustee. For all purposes of this Agreement, in the performance of
any duties or obligations of the Owner Trustee hereunder, the Indenture Trustee
shall be subject to, and entitled to the benefits of, the terms and provisions
of Article VI of the Indenture.

         Section 20. Third-Party Beneficiary. The Owner Trustee and the
Indenture Trustee are third-party beneficiaries to this Agreement and are
entitled to the rights and benefits hereunder and may enforce the provisions
hereof as if they were parties hereto.

         Section 21. Nonpetition Covenants. (a) Notwithstanding any prior
termination of this Agreement, the Seller, the Administrator, the Owner Trustee
and the Indenture Trustee shall not, prior to the date which is one year and one
day after the termination of this Agreement with respect to the Owner Trustee,
acquiesce, petition join in, encourage or otherwise invoke or cause the Owner
Trustee to invoke the process of any court or government authority for the
purpose of commencing or sustaining a case against the Owner Trustee under any
federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Owner Trustee or any substantial part of its property, or ordering the
winding up or liquidation of the affairs of the Owner Trustee.

         (b) Notwithstanding any prior termination of this Agreement, the Owner
Trustee, the Administrator, the Owner Trustee and the Indenture Trustee shall
not, prior to the date which is one year and one day after the termination of
this Agreement with respect to the Seller, acquiesce, petition join in,
encourage or otherwise invoke or cause the Seller to invoke the process of any
court or government authority for the purpose of commencing or sustaining a case
against the Seller under any federal or state bankruptcy, insolvency or similar
law or appointing a receiver, liquidator, assignee,

                                       15
<PAGE>   18

trustee, custodian, sequestrator or other similar official of the Seller or any
substantial part of their respective property, or ordering the winding up or
liquidation of the affairs of the Seller.

         Section 22. Limitation of Liability. It is expressly understood and
agreed by and between the parties hereto (i) that this Agreement is executed and
delivered by Wilmington Trust Company, not in its individual capacity but solely
as Owner Trustee under the Trust Agreement dated as of July 26, 2001 with
Capital One Auto Receivables, LLC (the "Trust Agreement") in the exercise of the
power and authority conferred and vested in it as such Owner Trustee, (ii) each
of the representations, undertakings and agreements made herein by the Owner
Trustee are not personal representations, undertakings and agreements of
Wilmington Trust Company, but are binding only on the trust estate created
pursuant to the Trust Agreement, (iii) nothing contained herein shall be
construed as creating any liability on Wilmington Trust Company, individually or
personally, to perform any covenant of the Owner Trustee either expressed or
implied contained herein, all such liability, if any, being expressly waived by
the parties hereto and by any person claiming by, through or under any such
party, and (iv) under no circumstances shall Wilmington Trust Company be
personally liable for the payment of any indebtedness or expense of the Owner
Trustee or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Owner Trustee
under this Agreement.

                                       16
<PAGE>   19

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

                                             WILMINGTON TRUST COMPANY, not in
                                             its individual capacity but solely
                                             as Owner Trustee of Capital One
                                             Auto Finance Trust 2001-A

                                             By: /s/ DONALD G. MACKELCAN
                                                 -------------------------------
                                                Name: Donald G. MacKelcan
                                                Title: Vice President

                                       S-1

<PAGE>   20

                                             WELLS FARGO BANK MINNESOTA,
                                             NATIONAL ASSOCIATION not in its
                                             individual capacity but solely as
                                             Indenture Trustee

                                             By: /s/ TIMOTHY MATYI
                                                --------------------------------
                                                Name:  Timothy Matyi
                                                Title: Assistant Vice President

                                       S-2

<PAGE>   21

                                             CAPITAL ONE AUTO FINANCE, INC., as
                                             Administrator

                                             By: /s/ JEFFERY ELSWICK
                                                --------------------------------
                                                Name:  Jeffery Elswick
                                                Title: Manager Of Securitization

                                       S-3<PAGE>   1
                                                                    EXHIBIT 10.5

                                                                  EXECUTION COPY

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

                          MBIA INSURANCE CORPORATION,
                                  as Insurer,

                         CAPITAL ONE AUTO FINANCE, INC.
                                      and

                       CAPITAL ONE AUTO RECEIVABLES, LLC
                               as Issuer Parties

                                      and

                        BANC OF AMERICA SECURITIES LLC,
                     as Representative of the Underwriters

                           INDEMNIFICATION AGREEMENT

                                  $850,000,000
                     Capital One Auto Finance Trust 2001-A
               Automobile Receivable-Backed Notes, Series 2001-A
               Class A-1 Notes, Class A-2 Notes, Class A-3 Notes
                              and Class A-4 Notes

                           Dated as of July 12, 2001

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

<PAGE>   2
                           INDEMNIFICATION AGREEMENT

         This AGREEMENT, dated as of July 12, 2001 is between MBIA INSURANCE
CORPORATION (the "Insurer"), as the Insurer under the Note Guaranty Insurance
Policy (the "Policy") issued in connection with the Offered Notes described
below, Capital One Auto Finance, Inc. ("COAF"), Capital One Auto Receivables,
LLC, ("COAR," and together with COAF, the "Issuer Parties") and BANC OF AMERICA
SECURITIES LLC ("Bane of America"), as Representative of the Underwriters (the
"Representative") on behalf of the Underwriters (as defined below).

         Section 1. DEFINITIONS. As used in this Agreement, the following terms
shall have the respective meanings stated herein, unless the context clearly
requires otherwise, in both singular and plural form, as appropriate Capitalized
terms used in this Agreement but not otherwise defined herein will have the
meanings ascribed to such terms in the Indenture (as described below).

         "Act" means the Securities Act of 1933, as amended, together with all
related rules and regulations.

         "Agreement" means this Indemnification Agreement by and between the
Insurer and the Representative of the Underwriters.

         "Indemnified Party" means any party entitled to any indemnification
pursuant to Section 5 below, as the context requires.

         "Indemnifying Party" means any party required to provide
indemnification pursuant to Section 5 below, as the context requires.

         "Indenture" means the Indenture dated as of July 26, 2001 by and
between the Wilmington Trust Company, as Owner Trustee, and Wells Fargo Bank
Minnesota, National Association, as Indenture Trustee.

         "Insurance Agreement" means the Insurance Agreement, dated as of July
26, 2001 by and among the Insurer, the Owner Trustee, the Seller, the
Transferor, the Servicer, the Indenture Trustee and Owner Trustee.

         "Insurer Party" means the Insurer and its respective parents,
subsidiaries and affiliates and any shareholder, director, officer, employee,
agent or any "controlling person" (as such term is used in the Act) of any of
the foregoing.

         "Issuer Party" means each of COAF and COAR and its parent,
subsidiaries, and affiliates and any member, shareholder, director, officer,
employee, agent or any "controlling person" (as such term is used in the Act) of
any of the following.
<PAGE>   3
         "Losses" means (i) any actual out-of-pocket loss paid by the party
entitled to indemnification or contribution hereunder and (ii) any actual
out-of-pocket costs and expenses paid by such party, including reasonable fees
and expenses of its counsel, to the extent not paid, satisfied or reimbursed
from funds provided by any other Person (provided that the foregoing shall not
create or imply any obligation to pursue recourse against any such other
Person).

         "Offered Notes" means the Capital One Auto Finance Trust 2001-A
Automobile Receivable-Backed Notes, Series 2001-A, Class A-l, Class-A-2,
Class-A-3 and Class-A-4, issued in accordance with the provisions of the
Indenture.

         "Person" means any individual, partnership, joint venture, corporation,
trust or unincorporated organization or any government or agency or political
subdivision thereof.

         "Prospectus Supplement" means the Preliminary Prospectus Supplement
dated July 10, 2001 and the Prospectus Supplement dated July 12, 2001 with
respect to the Offered Notes.

         "Servicer" means Capital One Auto Finance, Inc. as the Servicer of the
Receivables or any other Eligible Servicer acting as servicer pursuant to the
Servicing Agreement. Unless the context otherwise requires "Servicer" also
refers to any successor Servicer appointed under the Indenture or pursuant to
the Servicing Agreement.

         "Servicing Agreement" means the Servicing Agreement dated as of July
26, 2001 by and among the Owner Trustee, the Indenture Trustee and the Servicer.

         "Underwriter Party" means, with respect to the Underwriters, each such
Underwriter and its parent, subsidiaries and affiliates and any shareholder,
director, officer, employee, agent or "controlling person" (as such term is used
in the Act) of any of the foregoing.

         "Underwriting Agreement" means the Underwriting Agreement by and among
COAF, Capital One Auto Receivables, LLC and Bane of America LLC, as
representative for the Underwriters, dated as of July 12, 2001.

         "Underwriters" and "Underwriter" means, in plural form, Banc of America
Securities LLC ("Banc of America"), Credit Suisse First Boston Corporation
("CSFB"), Deutsche Bank Alex. Brown Inc. ("Deutsche Bank") and First Union
Securities, Inc. ("First Union") and in singular form, each of Banc of America,
CSFB, Deutsche Bank and First Union.

         Section 2. REPRESENTATIONS AND WARRANTIES OF THE INSURER. The Insurer
represents and warrants to each Underwriter and the each Issuer Party as
follows:

                  (a) Organization and Licensing. The Insurer is a duly
incorporated and existing New York stock insurance company licensed to do
business in the State of New York and is in good standing under the laws of such
state.

                                       2
<PAGE>   4

                  (b) Corporate Power. The Insurer has the corporate power and
authority to issue the Policy and execute and deliver this Agreement and to
perform all of its obligations hereunder and thereunder.

                  (c) Authorization; Approvals. The issuance of the Policy and
the execution, delivery and performance of this Agreement have been duly
authorized by all necessary corporate proceedings. No further approvals or
filings of any kind, including, without limitation, any further approvals of or
further filings with any governmental agency or other governmental authority, or
any approval of the Insurer's board of directors or stockholders, are necessary
for the Policy and this Agreement to constitute the legal, valid and binding
obligations of the Insurer.

                  (d) Enforceability. The Policy, when issued, and this
Agreement will each constitute a legal, valid and binding obligation of the
Insurer, enforceable in accordance with its terms, subject to applicable laws
affecting the enforceability of creditors' lights generally.

                  (e) Financial Information. The consolidated financial
statements of the Insurer and its subsidiaries as of December 31, 2000 and
December 31, 1999 and for each of the three years in the period ended December
31, 2000 incorporated by reference in the Prospectus Supplement (the "Insurer
Audited Financial Statements"), fairly present in all material respects the
financial condition of the Insurer as of such date and for the period covered by
such statements in accordance with generally accepted accounting principles
consistently applied. The consolidated financial statements of the Insurer and
its subsidiaries as of March 31, 2001 and for the three month periods ended
March 31, 2001 and March 31, 2000 incorporated by reference in the Prospectus
Supplement (the "Insurer Unaudited Financial Statements", the Insurer Audited
Financial Statements and the Insurer Unaudited Financial Statements are referred
to herein as the "Insurer Financial Statements") present fairly in all material
respects the financial condition of the Insurer as of such date and for the
period covered by such statements in accordance with generally accepted
accounting principles applied in a manner consistent with the accounting
principles used in preparing the Insurer Audited Financial Statements, and since
March 31, 2001, there has been no material change in such financial condition of
the Insurer which would materially and adversely affect its ability to perform
its obligations under the Policy.

                  (f) Insurer Information. The information in the Prospectus
Supplement of the date hereof under the caption "THE NOTE GUARANTY INSURANCE
POLICY AND THE NOTE INSURER" (the "Insurer Information") is limited and does not
purport to provide the scope of disclosure required to be included in a
prospectus for a registrant under the Securities Act of 1933, in connection with
the public offer and sale of securities of such registrant. Within such limited
scope of disclosure, the Insurer Information does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading.

                  (g) No Litigation. There are no actions, suits, proceedings or
investigations pending or, to the best of the Insurer's knowledge, threatened
against it at law or in equity or

                                       3
<PAGE>   5

before or by any court, governmental agency, board or commission or any
arbitrator which, if decided adversely, would materially and adversely affect
its condition (financial or otherwise) or operations of it or would materially
and adversely affect its ability to perform its obligations under this Agreement
or the Policy.

         Section 3. REPRESENTATIONS AND WARRANTIES OF THE UNDERWRITERS. Each
Underwriter represents and warrants (but only with respect to itself) to the
Insurer as follows:

                  (a) Prospectus Supplement. It represents and warrants to and
agrees with the Insurer that the statements in the Prospectus Supplement made in
reliance upon and in conformity with written information relating to such
Underwriter furnished to Capital One Auto Finance, Inc. specifically for use in
the preparation of the Prospectus Supplement, and acknowledged in writing set
forth in the second paragraph (regarding concessions and discounts) and the
first sentence of the eighth paragraph (regarding marketmaking) under the
caption "Underwriting" in the Prospectus Supplement (referred to herein as the
"Underwriter Information"), are true and correct in all material respects.

                  (b) Corporate Power. It has the corporate power and authority
to execute and deliver this Agreement and the Underwriting Agreement and to
perform all of its obligations hereunder and thereunder in all material
respects.

                  (c) Authorization; Approvals. The execution, delivery and
performance of this Agreement and the Underwriting Agreement by such Underwriter
have been duly authorized by all necessary corporate proceedings. No further
approvals or filings of any kind, including, without limitation, any further
approvals of or further filing with any governmental agency or other
governmental authority, or any approval of such Underwriter's board of directors
or stockholders, are necessary for this Agreement and the Underwriting Agreement
to constitute the legal, valid and binding obligation of such Underwriter.

                  (d) Enforceability. This Agreement and the Underwriting
Agreement will each constitute a legal, valid and binding obligation of such
Underwriter, each enforceable in accordance with its terms, subject, as to the
enforcement of remedies, to bankruptcy, insolvency, reorganization, moratorium
and other similar laws affecting the enforceability of creditors' rights
generally applicable in the event of the bankruptcy, insolvency or
reorganization of such Underwriter and to general principles of equity.

                  (e) No Litigation. There are no actions, suits, proceedings or
investigations pending or, to the best of such Underwriter's knowledge,
threatened against it at law or in equity or before any court, governmental
agency, board or commission or any arbitrator which, if decided adversely, would
materially and adversely affect its condition (financial or otherwise) or its
operations or would materially and adversely affect its ability to perform its
obligations under this Agreement and the Underwriting Agreement.

         Section 4. [RESERVED].

                                       4
<PAGE>   6

         Section 5. INDEMNIFICATION.

                  (a) The Insurer hereby agrees, upon the terms and subject to
the conditions of this Agreement, to indemnify, defend and hold harmless each
Issuer Party and each Underwriter Party against (i) any and all Losses incurred
by them with respect to the offer and sale of any of the Offered Notes and
resulting from the Insurer's breach of any of its representations and warranties
set forth in Section 2 of this Agreement, and (ii) any and all Losses to which
any Issuer Party or any Underwriter Party may become subject, under the Act or
otherwise, subject to the limited scope of the Insurer Information described
below insofar as such Losses arise out of or result horn an untrue statement of
a material fact contained in the Prospectus Supplement or the omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or omission was made in the Insurer
Information included therein, and provided further, that it is understood that
the Insurer Information is limited and does not purport to provide the scope of
disclosure required to be included in a prospectus for a registrant under the
Securities Act of 1933, in connection with the public offer and sale of
securities of such registrant.

         (b) Each Underwriter hereby agrees, severally and not jointly, upon the
terms and subject to the conditions of this Agreement, to indemnify, defend and
hold harmless each Insurer Party against (i) any and all Losses incurred by it
with respect to the offer and sale of any of the Offered Notes and resulting
from such Underwriter's breach of any of its agreements, representations and
warranties set forth in Section 3 of this Agreement and (ii) any and all Losses
to which any Insurer Party may become subject, under the Act or otherwise,
insofar as such Losses arise out of or result from an untrue statement of a
material fact contained in the Prospectus Supplement or the omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading in each case to the extent, but only to the
extent, that such untrue statement or omission was made in the Underwriter
Information (as defined above) included therein.

         (c) Upon the incurrence of any Losses entitled to indemnification
hereunder, the Indemnifying Party shall reimburse the Indemnified Party promptly
upon establishment by the Indemnified Party to the Indemnifying Party of the
Losses incurred.

         Section 6. NOTICE TO BE GIVEN.

                  (a) Except as provided in Section 7 below with respect to
contribution, the indemnification provided herein by the Indemnifying Party
shall be the exclusive remedy of each Indemnified Party for the Losses resulting
from the Indemnifying Party's breach of a representation, warranty or agreement
hereunder, provided, however, that each Indemnified Party shall be entitled to
pursue any other remedy at law or in equity for any such breach so long as the

                                       5
<PAGE>   7

damages sought to be recovered shall not exceed the Losses incurred thereby
resulting from such breach.

                  (b) In the event that any action or regulatory proceeding
shall be commenced or claim asserted which may entitle an Indemnified Party to
be indemnified under this Agreement, such party shall give the Indemnifying
Party written or facsimile notice of such action or claim reasonably promptly
after receipt of written notice thereof.

                  (c) Upon request of the Indemnified Party, the Indemnifying
Party shall retain counsel reasonably satisfactory to the Indemnified Party to
represent the Indemnified Party and any others the Indemnifying Party may
designate in such proceeding and shall pay the fees and disbursements of such
counsel related to such proceeding. The Indemnifying Party may, at its option,
at any time upon written notice to the Indemnified Party, assume the defense of
any proceeding and may designate counsel reasonably satisfactory to the
Indemnified Party in connection therewith, provided that the counsel so
designated would have no actual or potential conflict of interest in connection
with such representation. Unless it shall assume the defense of any proceeding,
the Indemnifying Party shall not be liable for any settlement of any proceeding,
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Party agrees to
indemnify the Indemnified Party from and against any loss or liability by reason
of such settlement or judgment. The Indemnifying Party shall be entitled to
participate in the defense of any such action or claim in reasonable cooperation
with, and with the reasonable cooperation of, each Indemnified Party.

                  (d) The Indemnified Party will have the right to employ its
own counsel in any such action, but the fees and expenses of such counsel will
be at the expense of such Indemnified Party unless (i) the employment of counsel
by the Indemnified Party at the Indemnifying Party's expense has been authorized
in writing by the Indemnifying Party, (ii) the Indemnifying Party has not in
fact employed counsel to assume the defense of such action within a reasonable
time after receiving notice of the commencement of the action or (iii) the named
parties to any such action include the Indemnifying Party on the one hand and,
on the other hand, the Indemnified Party, and representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them (in which case if such Indemnified Party notifies the
Indemnifying Party in writing that it elects to employ separate counsel at the
expense of the Indemnifying Party, the Indemnifying Party shall not have the
right to assume the defense of such action or proceeding on such Indemnified
Party's behalf), in each of which cases the reasonable fees and expenses of
counsel (including local counsel) will be at the expense of the Indemnifying
Party, and all such fees and expenses will be reimbursed promptly as they are
incurred. In the event that any expenses so paid by the Indemnifying Party are
subsequently determined not to be required to be borne by the Indemnifying Party
hereunder, the party which received such payment shall promptly refund to the
Indemnifying Party the amount so paid by such Indemnifying Party.
Notwithstanding the foregoing, in connection with any one action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances, the Indemnifying Party shall not
be liable for the fees and expenses of more than

                                       6
<PAGE>   8
one counsel for the Issuer Parties, more than one counsel for all Underwriter
Parties and more than one counsel for all Insurer Parties, as applicable.

                  (e) The Indemnified Parties shall cooperate with the
Indemnifying Parties in resolving any event, which would give rise to an
indemnity obligation pursuant to Section 5 hereof in the most efficient manner.

                  (f) No settlement of any such claim or action shall be entered
into without the consent of each Indemnified Party who is subject to such claim
or action, on the one hand, and each Indemnifying Party who is subject to such
claim or action, on the other hand, provided, however, that the consent of such
Indemnified Party shall not be required if such settlement fully discharges,
with prejudice against the plaintiff, the claim or action against such
Indemnified Party.

                  (g) Any failure by an Indemnified Party to comply with the
provisions of this Section shall relieve the Indemnifying Party of liability
only if such failure is materially prejudicial to any legal pleadings, grounds,
defenses or remedies in respect thereof or the Indemnifying Party's financial
liability hereunder, and then only to the extent of such prejudice.

         Section 7. CONTRIBUTION.

                  (a) To provide for just and equitable contribution if the
indemnification provided by the Insurer is determined to be unavailable for any
Underwriter Party (other than pursuant to Section 4 or 5 of this Agreement), or
if the indemnification provided by the Underwriters is determined to be
unavailable for any Insurer Party (other than pursuant to Section 4 or 6 of this
Agreement), the Insurer and the relevant Underwriter shall contribute to the
aggregate costs of liabilities arising from any breach of their respective
representations and warranties set forth in this Agreement on the basis of the
relative fault of all Insurer Parties and all relevant Underwriter Parties.

                  (b) To provide for just and equitable contribution if the
indemnification provided by the Insurer is determined to be unavailable for the
Issuer Parties (other than pursuant to Section 5 or 6 of this Agreement), the
Insurer shall contribute to the aggregate cost of liabilities arising from any
breach of their respective representations and warranties set forth in this
Agreement on the basis of the relative fault of all Insurer Parties and the
Issuer Parties.

                  (c) Notwithstanding anything in this Section 7 to the
contrary, (i) the Insurer shall not be requited to contribute an amount in
excess of the amount by which the total of the insurance premiums that have been
received by the Insurer under the Insurance Agreement exceeds the amount of any
damages that the Insurer has otherwise been required to pay in respect of any
bleach by the Insurer of the representations and warranties contained in Section
2 hereof, and (ii) no Underwriter shall be required to contribute an amount in
excess of the amount by which the total underwriting fees, discounts and
commissions received by such Underwriter exceeds the amount of any damages that
such Underwriter has otherwise been required to pay in

                                       7
<PAGE>   9

respect of any breach by such Underwriter of its representations and warranties
contained in Section 3 hereof.

                  (d) The relative fault of each Indemnifying Party, on the one
hand, and of each Indemnified Party, on the other hand, shall be determined by
reference to, among other things, whether the breach of, or alleged breach of,
any of its representations and warranties set forth in Section 2 or 3 of this
Agreement relates to information supplied by, or action within the control of,
the Insurer Party or the relevant Underwriter Party and the Parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such breach.

                  (e) The Parties agree that the Insurer shall be solely
responsible for the Insurer Information and for the Insurer Financial
Statements, that each Underwriter shall be responsible for the Underwriter
Information provided by such Underwriter in writing for use in the Prospectus
Supplement.

                  (f) No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.

                  (g) The indemnity agreements contained in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter Party, any Insurer Party
or any Issuer Party, (ii) the issuance of any Offered Notes or the Policy or
(iii) any termination of this Agreement.

                  (h) Upon the incurrence of any Losses entitled to contribution
hereunder, the contributor shall reimburse the party entitled to contribution
promptly upon establishment by the party entitled to contribution to the
contributor of the Losses incurred.

                  (i) The Underwriters shall be severally and not jointly liable
for any contribution required by this Section 7.

         Section 8. NOTICES. All notices and other communications provided for
under this Agreement shall be addressed to the address set forth below as to
each party or at such other address as shall be designated by a party in a
written notice to the other party.

         If to the Insurer:  MBIA Insurance Corporation
                             113 King Street
                             Armonk, NY 10504
                             Attention: Insured Portfolio Management--Structured
                             Finance (IPM-SF)

                                       8
<PAGE>   10

         If to the Issuer Parties:

                               Capital One Auto Finance, Inc.
                               8000 Jones Branch Drive
                               McLean, Virginia 22202
                               Facsimile: (703) 875-1389
                               Confirmation: (703) 875-1305

                               With a copy to Legal Department
                               Facsimile: (703) 875-1589
                               Confirmation: (703) 875-1000

                               Capital One Auto Receivables, LLC
                               8000 Jones Branch Drive
                               McLean, Virginia 22202
                               Facsimile: (703) 875-1389
                               Confirmation: (703) 875-1305

                               With a copy to Legal Department
                               Facsimile: (703) 875-1589
                               Confirmation: (703) 875-1000

         If to the Representative:

                               Banc of America Securities LLC
                               100 North Tryon Street, 10th Floor
                               NC1-007-11-07
                               Charlotte, NC 28255
                               Attention: Andy Glenn

         Section 9. GOVERNING LAW, ETC. This Agreement shall be deemed to be a
contract under the laws of the State of New York and shall be governed by and
construed in accordance with the laws of the State of New York without regard to
its conflicts of laws provisions. This Agreement may not be assigned by any
party without the express written consent of each other party. Amendments of
this Agreement shall be in writing signed by each party. This Agreement shall
not be effective until executed by each of the Insurer, each Issuer Party and
the Underwriters.

         Section 10. OTHER OBLIGATIONS NOT EFFECTED. This Agreement in no way
limits or otherwise affects the indemnification obligations of the Underwriters
and COAF under the Underwriting Agreement.

         Section 11. LIMITATIONS. Nothing in this Agreement shall be construed
as a representation or undertaking by the Insurer concerning maintenance of the
rating currently assigned to its claims-paying ability by Moody's Investors
Service, Inc. ("Moody's") and/or Standard & Poor's, a division of The
McGraw-Hill Companies, Inc. ("S&P") or any other rating agency (collectively,
the "Rating Agencies").

                                       9
<PAGE>   11

         Section 12. COUNTERPARTS. This Agreement may be executed in any number
of counterparts, each of which shall together constitute but one and the same
instrument.

         Section 13. NON-PETITION. So long as the Insurance Agreement is in
effect, and for one year following its termination, each of the parties hereto
agree that it (with respect to itself) file any involuntary petition or
otherwise institute any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding or other proceeding under any federal or state bankruptcy
or similar law against the Issuer Parties or the Seller.

                                       10
<PAGE>   12

         IN WITNESS WHEREOF, the Parties hereto have caused this Indemnification
Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized, all as of the date first above written.

                                MBIA INSURANCE CORPORATION

                                By  /s/ LISA WILSON
                                  ----------------------------------------------
                                Title   Assistant Secretary
                                     -------------------------------------------

                                BANC OF AMERICA SECURITIES LLC, for
                                itself and as Representative of the Underwriters

                                By /s/ JAMES G. MACKEY
                                  ----------------------------------------------
                                Title   Vice President
                                     -------------------------------------------

                                CAPITAL ONE AUTO FINANCE, INC., as Issuer
                                Party

                                By /s/ JEFFERY ELSWICK
                                  ----------------------------------------------
                                Title  Manager of Securitization
                                     -------------------------------------------

                                CAPITAL ONE AUTO RECEIVABLES, LLC, as
                                Issuer Party

                                By /s/ JEFFERY ELSWICK
                                  ----------------------------------------------
                                Title  President
                                     -------------------------------------------

<PAGE>   13

                               TABLE OF CONTENTS

Section 1.    Definitions......................................................1
Section 2.    Representations and Warranties of the Issuer.....................2
Section 3.    Representations and Warranties of the Underwriters...............4
Section 4.    [RESERVED].......................................................4
Section 5.    Indemnification..................................................5
Section 6.    Notice to be Given...............................................5
Section 7.    Contribution.....................................................7
Section 8.    Notices..........................................................8
Section 9.    Governing Law, Etc. .............................................9
Section 10.   Other Obligations Not Effected...................................9
Section 11.   Limitations......................................................9
Section 12.   Counterparts.....................................................9
Section 13.   Non-petition.....................................................9

TESTIMONIUM.......................................................SIGNATURE PAGE
SIGNATURES........................................................SIGNATURE PAGE

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