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BACKUP SERVICING AGREEMENT

          BACKUP SERVICING AGREEMENT (the “Agreement”), dated as of May 23, 2008, among SYSTEMS
& SERVICES TECHNOLOGIES, INC., a Delaware corporation (the “Backup Servicer”), CREDIT
ACCEPTANCE CORPORATION, a Michigan corporation (“Credit Acceptance” or the
“Servicer”), CAC WAREHOUSE FUNDING III, LLC, a Delaware limited liability company (the
“Borrower”), and FIFTH THIRD BANK, an Ohio banking corporation, as collateral agent (the
“Collateral Agent”) and as deal agent (the “Deal Agent”).

W I T N E S S E T H

:

          WHEREAS, Credit Acceptance, the Borrower, the Backup Servicer, the Deal Agent, the Liquidity
Agent, Relationship Funding Company, LLC and the Collateral Agent have entered into a Loan and
Security Agreement, dated as of the Closing Date (as amended, restated, supplemented or otherwise
modified from time to time, the “Loan Agreement”);

          WHEREAS, the parties to the Loan Agreement desire to obtain the services of the Backup
Servicer to perform certain servicing functions and assume certain obligations with respect to the
Loan Agreement, all as set forth herein, and the Backup Servicer has agreed to perform such
functions and assume such obligations; and

          WHEREAS, for its services hereunder and with respect to the Loan Agreement, the Backup
Servicer will receive a fee payable as described herein;

          NOW THEREFORE, in consideration for the mutual agreements contained herein and for other good
and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties
hereto agree as follows:

ARTICLE 1

DEFINITIONS

     SECTION 1.1. Definitions. All capitalized terms not otherwise defined herein shall
have the meanings specified in, or incorporated by reference to, the Loan Agreement. The following
terms shall have the meanings specified below:

          “Aggregate Basis” means verification of only such aggregated amounts as are stated in
the Monthly Report, and not as to any amount related to any Dealer Loan or Contract.

          “Assumption Date” has the meaning specified in Section 2.3(a).

          “Backup Servicer Event of Default” has the meaning specified in Section 4.1.

          “Backup Servicer’s Certificate” has the meaning specified in Section 2.10.

 

 

          “Backup Servicing Fee” means, as to each Payment Date, $4,000; provided,
however, that if the Backup Servicer becomes the successor Servicer, such fee shall no
longer be paid.

          “Continued Errors” has the meaning specified in Section 2.2(c)(iii).

          “Errors” has the meaning specified in Section 2.2(c)(iii).

          “Liability” has the meaning specified in Section 2.2(c)(i).

          “Live Data Files” has the meaning specified in Section 2.6(a).

          “Material Adverse Change” means any circumstance or event which in the reasonable
judgment of the Deal Agent: (a) may be reasonably expected to cause a material adverse change to
the validity or enforceability of this Agreement or the Loan Agreement; or (b) may be reasonably
expected to materially impair the ability of the Backup Servicer to fulfill its obligations under
this Agreement or the Loan Agreement.

          “Servicer’s Data File” has the meaning specified in Section 2.1(a).

          “Service-Related Activities” means the services and service-related activities and the
servicer-related responsibilities of the Servicer provided for under the Loan Agreement as modified
or eliminated herein with respect to the Backup Servicer.

          “Servicing Fee” has the meaning given such term in Section 1.1 of the Loan
Agreement.

          “Successor Backup Servicer” has the meaning specified in Section 2.4(b).

          “Third Party” has the meaning specified in Section 2.9(d).

     SECTION 1.2. Usage of Terms. With respect to all terms in this Agreement, the
singular includes the plural and the plural the singular; words importing any gender include the
other gender; references to “writing” include printing, typing, lithography, and other means of
reproducing words in a visible form; references to agreements and other contractual instruments
include all subsequent amendments thereto or changes therein entered into in accordance with their
respective terms and not prohibited by this Agreement; references to Persons include their
permitted successors and assigns; and the term “including” means “including without limitation.”

     SECTION 1.3. Section References. All section references shall be to Sections in this
Agreement (unless otherwise provided).

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ARTICLE 2

ADMINISTRATION AND COLLECTION

     SECTION 2.1. Reconciliation of Monthly Reports.

          (a) No later than 9:00 A.M. New York City time on the third Business Day following the end of
each Collection Period, the Servicer shall send to the Backup Servicer an electronic file,
detailing the Collections received during the prior Collection Period and all other information in
its possession relating to the Dealer Loans and the Contracts as may be necessary for the complete
and correct completion of each Monthly Report (the “Servicer’s Data File”) (to the extent
of the information required to be provided by the Servicer). Such electronic file shall be in the
form and have the specifications as may be agreed to between the Servicer and the Backup Servicer
from time to time. The Backup Servicer shall, within one (1) day of the receipt thereof, load the
Servicer’s Data File and confirm that it is in readable form. If the Backup Servicer determines
that the Servicer’s Data File is not in readable form, the Backup Servicer shall immediately upon
discovery thereof notify the Servicer and the Deal Agent by telephone, and upon such notification,
the Servicer shall prepare and send a replacement Servicer’s Data File to the Backup Servicer
satisfying the Backup Servicer’s specifications, for receipt by the Backup Servicer on the next
Business Day.

          (b) No later than the end of the second Business Day prior to each Determination Date, the
Servicer shall furnish to the Backup Servicer the Monthly Report related to the prior Collection
Period together with all other information necessary for preparation of such Monthly Report and
necessary to determine the application of Collections as provided in the Loan Agreement. The
Backup Servicer shall review the information contained in the Monthly Report against the
information on the Servicer’s Data File, on an Aggregate Basis. No later than three (3) Business
Days after the Backup Servicer’s receipt of each Monthly Report, the Backup Servicer shall notify
the Servicer and the Deal Agent of any inconsistencies between the Monthly Report and the
information contained in the Servicer’s Data File; provided, however, in the
absence of a reconciliation, the Monthly Report shall control for the purpose of calculations and
distributions with respect to the related Distribution Date. If the Backup Servicer and the
Servicer are unable to reconcile discrepancies with respect to a Monthly Report prior to the
related Distribution Date, the Servicer shall cause a firm of independent accountants, at the
Servicer’s expense, to audit the Monthly Report and, prior to the third Business Day, but in no
event later than the fifth calendar day, of the following month, reconcile the discrepancies. The
effect, if any, of such reconciliation shall be reflected in the Monthly Report for such next
Distribution Date. The Backup Servicer shall only review the information provided by the Servicer
in the Monthly Report and in the Servicer’s Data File and its obligation to report any
inconsistencies shall be limited to those determinable from such information.

          (c) The Backup Servicer and the Servicer shall attempt to reconcile any such inconsistencies
and/or to furnish any omitted information and the Servicer shall amend the Monthly Report to
reflect the results of the reconciliation or to include any omitted information.

          (d) The Servicer shall provide monthly, or as otherwise requested, to the Backup Servicer, or
its agent, information on the Dealer Loans and related Contracts sufficient to

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enable the Backup Servicer to assume the responsibilities as successor servicer under the Loan
Agreement and service and collect the Dealer Loans and related Contracts.

          (e) The Servicer shall provide the Backup Servicer with any and all updates to the master file
data layout and copy book information necessary due to system changes or modifications, which may
require changes to the Backup Servicer’s applications necessary to read the Servicer’s Data File.

     SECTION 2.2. Review and Verification.

          (a) Notwithstanding anything in Section 2.1 to the contrary, on or before the end of
the second Business Day prior to each Determination Date, the Servicer shall provide sufficient
data to the Backup Servicer to allow the Backup Servicer to review and to verify the mathematical
accuracy of the Monthly Report on an Aggregate Basis related thereto and determine the following:

     (i) that such Monthly Report is complete on its face;

     (ii) that the amounts credited to and withdrawn from the Collection Account and
the balance of such account, as set forth in the records of the Collateral Agent and
Servicer are the same as the amount set forth in the Monthly Report; and

     (iii) that the amounts credited to and withdrawn from the Reserve Account and
the balance of such account, as set forth in the records of the Collateral Agent and
Servicer are the same as the amount set forth in the Monthly Report.

          (b) The Backup Servicer shall, on or before the Determination Date with respect to any
Collection Period, verify the mathematical accuracy of the Monthly Report in its entirety, which
shall include but not be limited to the following:

     (i) the amount of the related distribution allocable to principal;

     (ii) the amount of the related distribution allocable to interest;

     (iii) the amount of the related distribution payable out of the Reserve
Account;

     (iv) the Aggregate Outstanding Eligible Loan Net Balance, the Aggregate
Outstanding Eligible Loan Balance and the aggregate Outstanding Balance of all
Eligible Contracts as of the close of business on the last day of the preceding
Collection Period;

     (v) the outstanding Capital;

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     (vi) the amount of the Servicing Fee paid to the Servicer with respect to the
related Collection Period and/or due but unpaid with respect to such Collection
Period or prior Collection Periods, as the case may be;

     (vii) the Required Reserve Account Amount;

     (viii) the total amount of Collections for the related Collection Period; and

     (ix) in the aggregate, the Release Price, Retransfer Amount and/or
Nonconforming Contract Payment Amount, if any, that was paid in such period pursuant
to Section 4.5(a), Section 4.5(b) and/or Section 6.2 of the
Loan Agreement, as applicable.

          (c) The Backup Servicer shall provide written notice to the Deal Agent with respect to whether
there are any inconsistencies or deficiencies with respect to its review and verification set forth
in paragraphs (a) and (b) above and, if any, shall provide a description thereof as set forth in
Section 2.10 hereof. In the event of any discrepancy between the information set forth in
subparagraphs (a) and (b) above, as calculated by the Servicer, from that determined or calculated
by the Backup Servicer, the Backup Servicer shall promptly notify the Servicer and, if within three
(3) days of such notice being provided to the Servicer, the Backup Servicer and the Servicer are
unable to resolve such discrepancy, the Backup Servicer shall promptly (but in any event within
three Business Days) notify the Deal Agent of such discrepancy.

     (i) Other than as specifically set forth elsewhere 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 duty, responsibility, obligation,
or liability (collectively “Liability”) for any action taken or omitted by
the Servicer.

     (ii) The Backup Servicer shall consult with the Servicer as may be necessary
from time to time to perform or carry out the Backup Servicer’s obligations
hereunder, including the obligation, if requested in writing by the Deal Agent, to
succeed within thirty (30) days to the duties and obligations of the Servicer
pursuant to Section 2.3.

     (iii) Except as otherwise provided in this Agreement, the Backup Servicer may
accept and reasonably rely on all accounting, records and work of the Servicer
without audit, and the Backup Servicer shall have no Liability for the acts or
omissions of the Servicer or for the inaccuracy of any data provided, produced or
supplied by the Servicer. If any error, inaccuracy or omission (collectively,
“Errors”) exists in any information received from the Servicer, and such
Errors should cause or materially contribute to the Backup Servicer making or
continuing any Errors (collectively, “Continued Errors”), the Backup
Servicer shall have no Liability for such Continued Errors; provided,
however, that this

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provision shall not protect the Backup Servicer against
any Liability which would otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in discovering or correcting any Error or in the performance of its
duties hereunder or under the Loan Agreement. In the event the Backup Servicer
becomes aware of Errors or Continued Errors which, in the opinion of the Backup
Servicer impairs its ability to perform its services hereunder, the Backup Servicer
may, with the prior consent of the Deal Agent, undertake to reconstruct and
reconcile such data as it deems appropriate to correct such Errors and Continued
Errors and prevent future Continued Errors. The Backup Servicer shall be entitled
to recover its costs thereby expended from the Servicer.

     (iv) The Backup Servicer and its officers, directors, employees and agents
shall be indemnified by the Servicer and the Borrower from and against all claims,
damages, losses or expenses reasonably incurred by the Backup Servicer (including
reasonable attorney’s fees and expenses) arising out of claims asserted against the
Backup Servicer on any matter arising out of this Agreement to the extent the act or
omission giving rise to the claim accrues before the Assumption Date, except for any
claims, damages, losses or expenses arising from the Backup Servicer’s own willful
misfeasance, bad faith or gross negligence; provided, however, that
any obligation or liability of the Borrower hereunder shall be limited to any
amounts payable by the Borrower pursuant to Section 2.7 of the Loan
Agreement. The obligations of the Servicer and the Borrower under this Section
shall survive the termination of this Agreement and the earlier resignation or
removal of the Backup Servicer.

     (v) To the extent the Backup Servicer requires any information supplementing
reports or data that is to be provided to it pursuant to the Transaction Documents
in order to complete its verification duties, the Backup Servicer’s verification
duties are conditioned upon timely receipt by the Backup Servicer of such
information.

     SECTION 2.3. Assumption of Servicer’s Obligations.

          (a) The Backup Servicer agrees that within 30 days of receipt of a written notice from the
Deal Agent of the termination of the rights and obligations of Credit Acceptance as Servicer
pursuant to the Loan Agreement, and without further notice, the Backup Servicer shall, subject to
the exclusions stated herein, assume the Service-Related Activities of Credit Acceptance under the
Loan Agreement (the “Assumption Date”) and further agrees that it shall assume all such
Service-Related Activities in accordance with the requirements, terms and conditions set forth in
the Loan Agreement and this Agreement. In the event of a conflict between any provision of the
Loan Agreement and this Agreement, this Agreement shall be controlling.

          (b) In the event of an assumption by the Backup Servicer of the Servicer-Related Activities of
Credit Acceptance under the Loan Agreement, the Backup Servicer shall be obligated to perform the
obligations imposed on the Servicer under the Loan Agreement.

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          (c) Following the Assumption Date, the Deal Agent, in its sole and absolute discretion, may
terminate all of the Backup Servicer’s management, administrative, servicing and collection rights
and obligations with respect to the Dealer Loans and Contracts upon ninety (90) days prior written
notice (such notice, a “Discretionary Termination Notice”) of such termination to the
Backup Servicer (any such termination of servicing, a “Discretionary Termination”). A
Termination Fee equal to the product of three (3) times the Servicing Fee for the month in which
the Discretionary Termination Notice is received shall be payable by the Borrower with respect to
any such Discretionary Termination.

     SECTION 2.4. Servicing and Retention of Servicer.

          (a) Subject to early termination of the Backup Servicer due to the occurrence of a Backup
Servicer Event of Default, or pursuant to Article 4, or as otherwise provided in this Section
2.4, on and after the Assumption Date, the Backup Servicer shall be responsible for the
servicing, administering, managing and collection of the Dealer Loans and Contracts in accordance
herewith and the Loan Agreement.

          (b) In the event of a Backup Servicer Event of Default, the Deal Agent shall have the right to
terminate the Backup Servicer as successor Servicer and Backup Servicer hereunder. Upon the
termination or resignation of the Backup Servicer hereunder, the Deal Agent shall have the right to
appoint a successor Backup Servicer (the “Successor Backup Servicer”) and enter into a
backup servicing agreement with such Successor Backup Servicer at such time and exercise all of its
rights under the Loan Agreement; provided, however, that if such termination or
resignation of the Backup Servicer occurs prior to the Assumption Date, the appointment of the
Successor Backup Servicer shall be mutually acceptable to Credit Acceptance and the Deal Agent.
Such backup servicing agreement shall specify the duties and obligations of the Successor Backup
Servicer, and all references herein and in the Loan Agreement to the Backup Servicer shall be
deemed to refer to such Successor Backup Servicer.

          (c) The Backup Servicer shall not resign from the obligations and duties imposed on it by this
Agreement or the Loan Agreement, as successor servicer or as Backup Servicer, as applicable, except
upon a determination that by reason of a change in legal requirements, the performance of its
duties hereunder or under the Loan Agreement would cause it to be in violation of such legal
requirements in a manner which would have a material adverse effect on the Backup Servicer, and the
Deal Agent does not elect to waive the obligations of the Backup Servicer to perform the duties
which render it legally unable to act or to delegate those duties to another Person. Any such
determination permitting the resignation of the Backup Servicer pursuant to this Section
2.4(c) shall be evidenced by an opinion of counsel to such effect delivered and acceptable to
the Deal Agent. No resignation of the Backup Servicer shall become effective until an entity
reasonably acceptable to the Deal Agent shall have assumed the responsibilities and obligations of
the Backup Servicer.

          (d) Any Person: (i) into which the Backup Servicer may be merged or consolidated; (ii)
resulting from any merger or consolidation to which the Backup Servicer shall be a party; (iii)
which acquires by conveyance, transfer or lease substantially all of the assets of the Backup
Servicer; or (iv) succeeding to the business of the Backup Servicer, in any of the

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foregoing cases
shall execute an agreement of assumption to perform every obligation of the
Backup Servicer under this Agreement and the Loan Agreement, whether or not such assumption
agreement is executed, shall be the successor to the Backup Servicer under this Agreement and the
Loan Agreement without the execution or filing of any paper or any further act on the part of any
of the parties to this Agreement or the Loan Agreement, anything herein or therein to the contrary
notwithstanding; provided, however, that nothing contained herein or therein shall
be deemed to release the Backup Servicer from any obligation hereunder or under the Loan Agreement.

          (e) Following the Assumption Date, the Backup Servicer shall be required to deliver to the
Deal Agent on or before one hundred twenty (120) days after the end of the Backup Servicer’s fiscal
year, with respect to such fiscal year, a copy of its annual SAS-70 and its audited financial
statements for such fiscal year.

          (f) Concurrently with the delivery of the financial reports delivered under (e) above, a
report in substantially the form attached to this Agreement as Exhibit I and certified by the chief
financial officer of the Backup Servicer, certifying that no Backup Servicer Event of Default and
no event which, with the giving of notice or the passage of time, would become a Backup Servicer
Event of Default has occurred and is continuing or, if any such Backup Servicer Event of Default or
other event has occurred and is continuing, such a Backup Servicer Event of Default has occurred
and is continuing, the action which the Backup Servicer has taken or proposes to take with respect
thereto, shall be delivered to the Deal Agent.

     SECTION 2.5. Servicing Duties of the Backup Servicer. On and after the Assumption
Date:

          (a) The Backup Servicer shall take or cause to be taken all such action as may be necessary or
advisable to collect all amounts due under the Dealer Loans and Contracts from time to time, all in
accordance with applicable laws, rules and regulations, with reasonable care and diligence, and in
accordance with the Collection Guidelines. There shall be no recourse to the Backup Servicer with
regard to the Dealer Loans and Contracts. The Backup Servicer shall hold in trust for the
Collateral Agent all records which evidence or relate to all or any part of the Collateral. In the
event that a Successor Backup Servicer is appointed, the outgoing Backup Servicer shall deliver to
the Successor Backup Servicer and the Successor Backup Servicer shall hold in trust for the
Collateral Agent all records which evidence or relate to all or any part of the Collateral.

          (b) The Backup Servicer shall as soon as practicable upon demand, deliver to the Servicer all
records in its possession which evidence or relate to indebtedness of an Obligor which is not a
Dealer Loan or Contract.

          (c) The Backup Servicer shall remit to the Collection Account within two (2) Business Days of
receipt, all Collections.

          (d) In addition to the obligations of the Backup Servicer under this Agreement, the Backup
Servicer shall perform all of the obligations of the Servicer as servicer

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under the Loan Agreement,
except as set forth in Section 2.3(b) hereof. Without limiting the foregoing and anything
provided for herein, the Backup Servicer shall perform the following in
substantially the same manner and level at which Credit Acceptance performs such on the date
hereof: (a) customer service inquiries/responsibilities; (b) collections on delinquent and
charged-off contracts; (c) insurance monitoring and the making of claims with respect thereto; (d)
creating the Monthly Reports; (e) repossession and other legal actions; (f) statements to
performing contracts and other correspondence; (g) reconciliation of dealer holdback payments; (h)
inventory management; (i) maintenance of lock-box accounts; (j) electronic skip tracing; and (k)
document storage and title maintenance.

     SECTION 2.6. Other Obligations of the Backup Servicer and Servicer.

          (a) No later than the 10th day of each calendar month until the earlier of the
Assumption Date or the termination of this Agreement, Credit Acceptance shall provide a Live Data
File (as defined below) transmission to the Backup Servicer, which shall include the Dealer Loan
and Contract master file, the transaction history file and all other files necessary to carry out
the Service-Related Activities received in connection herewith (the “Live Data Files”).
The Backup Servicer shall convert the Live Data Files to its internal systems, and no later than
five (5) Business Days after the receipt thereof, shall confirm in writing to Credit Acceptance and
the Deal Agent the accuracy and completeness of the conversion; provided, however,
that such confirmation shall not be deemed to apply to the accuracy of the Live Data Files as
provided by Credit Acceptance, but shall be deemed only to apply to the accuracy of the conversion
of the Live Data Files to the Backup Servicer’s internal systems. In the event of any changes in
format with respect to either Credit Acceptance or the Backup Servicer, Credit Acceptance and the
Backup Servicer shall coordinate with each other for the replacement of the data files with files
in the correct format, modified accordingly. To verify that Live Data Files have been accurately
converted to the Backup Servicer’s internal servicing system, the Backup Servicer will provide
Credit Acceptance and the Deal Agent with such reports as are mutually agreed upon by Credit
Acceptance and the Backup Servicer from time to time. Credit Acceptance reserves the right to
review converted data on the Backup Servicer’s system either by performing an onsite review of the
Backup Servicer’s systems or, at Credit Acceptance’s sole expense, by having remote access to the
Backup Servicer’s systems.

          (b) In connection with the Backup Servicer assuming the obligations of Servicer hereunder and
under the Loan Agreement, Credit Acceptance agrees that it shall: (i) promptly make available to
the Backup Servicer access to all records and information in the possession of Credit Acceptance
related to the Dealer Loans and the Contracts as may be necessary or reasonably requested by the
Backup Servicer in connection with the performance of the Backup Servicer’s obligations hereunder
and thereunder; and (ii) cooperate in good faith with the Backup Servicer and the Deal Agent in
connection with any transition of the servicing of the Dealer Loans and Contracts to the Backup
Servicer.

     SECTION 2.7. Servicing Compensation. As compensation for the performance of its
obligations under this Agreement and with respect to the Loan Agreement, the Backup Servicer is
entitled to: (i) prior to the Assumption Date, the Backup Servicing Fee and (ii) after the

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Assumption Date, the sum of: (A) the Servicing Fee, (B) any Repossession Expenses, (C) any
Reliening Expenses and (D) any Transition Expenses.

     SECTION 2.8. Collateral Agent’s Rights. At any time following the Assumption Date:

          (a) The Collateral Agent or the Backup Servicer may direct that payment of all amounts payable
under any Dealer Loans or Contracts be made directly to the Backup Servicer, the Collateral Agent
or its designee.

          (b) The Servicer shall, (unless otherwise directed by the Deal Agent) (i) assemble all of the
records relating to the Collateral and shall make the same available to the Backup Servicer (or the
Collateral Agent if so directed by the Deal Agent) at a place selected by the Backup Servicer or
the Collateral Agent, as applicable; provided, however, that the Servicer will be
entitled to retain copies of all records provided pursuant to this Section 2.8(b), and (ii)
segregate all cash, checks and other instruments received by it from time to time constituting
Collections in a manner acceptable to the Deal Agent and shall, promptly upon receipt but no later
than one (1) Business Day after receipt, remit all such cash, checks and instruments, duly endorsed
or with duly executed instruments of transfer, as directed by the Deal Agent or the Backup
Servicer.

          (c) Credit Acceptance hereby authorizes the Collateral Agent and the Backup Servicer to take
any and all steps in Credit Acceptance’s name and on behalf of Credit Acceptance necessary or
desirable, in the determination of the Backup Servicer or the Collateral Agent acting in “good
faith” (as such term is defined in Article 9 of the UCC), to collect all amounts due under any and
all of the Dealer Loans, including, without limitation, endorsing Credit Acceptance’s name on
checks and other instruments representing Collections and enforcing the Dealer Loans and Contracts;
provided, however, that the Collateral Agent shall not have an affirmative
obligation to carry out such duties.

     SECTION 2.9. Liability of the Backup Servicer; Standard of Care.

          (a) The Backup Servicer shall not be liable for its actions or omissions hereunder except (i)
for its negligence, willful misconduct or breach of this Agreement not caused by another party to
this Agreement, or (ii) for any recitals, statements, representations or warranties made expressly
by the Backup Servicer.

          (b) The Backup Servicer shall indemnify, defend and hold harmless the Servicer and its
respective officers, directors, agents and employees from and against any and all costs, expenses,
losses, claims, damages and liabilities to the extent that such cost, expense, loss, claim, damage
or liability arose out of, or was imposed upon the Servicer through the Backup Servicer’s breach of
this Agreement, the willful misfeasance, bad faith or negligence of the Backup Servicer in the
performance of its duties under this Agreement or by reason of reckless disregard of its
obligations and duties under this Agreement.

          (c) The Servicer shall indemnify, defend and hold harmless the Backup Servicer and its
respective officers, directors, agents and employees from and against any and all costs, expenses,
losses, claims, damages and liabilities to the extent that such cost, expense, loss,

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claim, damage
or liability arose out of, or was imposed upon the Backup Servicer through the Servicer’s breach of
this Agreement, the willful misfeasance, bad faith or negligence of the Servicer in the performance
of its duties under this Agreement or by reason of reckless disregard of its obligations and duties
under this Agreement.

          (d) The Backup Servicer may accept and reasonably rely on all accounting and servicing records
and other documentation provided to the Backup Servicer by or at the direction of the Servicer,
including documents prepared or maintained by any originator, or previous servicer, or any party
providing services related to the Dealer Loans or Contracts (collectively, the “Third
Party”). The Servicer agrees to indemnify (subject to the limitation provided in subsection
(e) below) and hold harmless the Backup Servicer, its respective officers, employees and agents
against any and all claims, losses, penalties, fines, forfeitures, legal fees and related costs,
judgments, and any other costs, fees and expenses that the Backup Servicer may sustain in any way
related to the negligence or misconduct of any Third Party with respect to the Dealer Loans or
Contracts. The Backup Servicer shall have no Liability for the acts or omissions of any such Third
Party or for the inaccuracy of any data provided, produced or supplied by such Third Party. If any
Error exists in any information provided to the Backup Servicer and such Errors cause or materially
contribute to the Backup Servicer making a Continuing Error, the Backup Servicer shall have no
liability for such Continued Errors; provided, however, that this provision shall
not protect the Backup Servicer against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in discovering or correcting any error or in the
performance of its duties contemplated herein.

          In the event the Backup Servicer becomes aware of Errors and/or Continued Errors which, in the
opinion of the Backup Servicer, impair its ability to perform its services hereunder, the Backup
Servicer shall promptly notify the Servicer and the Deal Agent of such Errors and/or Continued
Errors. With the prior consent of the Servicer and the Deal Agent, the Backup Servicer may
undertake to reconstruct any data or records appropriate to correct such Errors and/or Continued
Errors and to prevent future Continued Errors. The Backup Servicer shall be entitled to recover
its costs thereby expended from the Servicer.

          (e) Indemnification under this Article shall include, without limitation, reasonable fees and
expenses of counsel and expenses of litigation. If the indemnifying party has made any indemnity
payments pursuant to this Article and the recipient thereafter collects any of such amounts from
others, the recipient shall promptly repay such amounts collected to the indemnifying party,
together with any interest earned thereon.

          (f) In performing the Service-Related Activities contemplated by this Agreement, the Backup
Servicer agrees to comply in all respects with the applicable state and federal laws and will carry
out such activities with the same degree of care as that provided for the Servicer under the Loan
Agreement. The Backup Servicer shall maintain all state and federal licenses and franchises
necessary for it to perform Service-Related Activities. The Backup Servicer shall not have any
Liability for any Error or Continued Error by the Servicer, or for any error, inaccuracy or
omission of the Servicer before the Backup Servicer assumes the Service-Related Activities.

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          (g) Neither the Backup Servicer nor any of the directors or officers or employees or agents of
the Backup Servicer shall be under any liability to the Servicer or any party to this Agreement or
the Loan Agreement except as provided in this Agreement, for any action taken or for refraining
from the taking of any action in good faith pursuant to this Agreement; provided,
however, that this provision shall not protect the Backup Servicer or any
such person against any liability that would otherwise be imposed by reason of a breach of
this Agreement or willful misfeasance, bad faith or gross negligence (excluding errors in judgment)
in the performance of duties, by reason of reckless disregard of obligations and duties under this
Agreement or any violation of law by the Backup Servicer or such person, as the case may be. The
Backup Servicer and any director, officer, employee or agent of the Backup Servicer may
conclusively rely and shall be fully protected in acting or refraining from acting upon any
document, certificate, instrument, opinion, notice, statement, consent, resolution, entitlement
order, approval or conversation believed by it to be genuine and made by the proper person and upon
the advice or opinion of counsel or other experts selected by it. The Backup Servicer shall not be
liable for an error of judgment made in good faith by a Responsible Officer of the Backup Servicer,
unless it shall be proven that the Backup Servicer was negligent in ascertaining the pertinent
facts.

          (h) The Backup Servicer shall maintain its existence and rights as a corporation under the
laws of the jurisdiction of its incorporation, and will obtain and preserve its qualification to do
business as a foreign corporation in each jurisdiction in which the failure to so qualify would
have an adverse effect on the validity or enforceability of any Contract, Dealer Agreement, this
Agreement or on the ability of the Backup Servicer to perform its duties under this Agreement or
the Loan Agreement.

          (i) The provisions of this Section shall survive the termination of this Agreement.

          (j) The Backup Servicer shall not be bound to make any investigation into the facts or matters
stated in any resolution, certificate, statement, instrument, opinion, report, notice, request,
consent, entitlement order, approval or other paper or document.

          (k) The Backup Servicer may execute any of the trusts or powers hereunder or perform any
duties hereunder either directly or by or through agents, attorneys, custodians or nominees
appointed with due care.

          (l) To the extent that the Backup Servicer is not indemnified by the Servicer pursuant to
Section 2.2 hereunder and under the Loan Agreement, such amounts shall be reimbursable by
the Borrower pursuant to the extent of amounts available therefor and in accordance with the
priorities for payment set forth in Section 2.7(a) of the Loan Agreement.

          (m) Notwithstanding anything to the contrary contained herein, in no event shall the Backup
Servicer be liable for special, indirect, or consequential damages of any kind whatsoever,
including but not limited to lost profits, even if the Backup Servicer has been advised of the
likelihood of such loss or damage and regardless of the form of action.

12

 

     SECTION 2.10. Backup Monthly Report. Prior to the Assumption Date, on or before
12:00 noon (New York City time) on the Business Day preceding each Distribution Date, the Backup
Servicer shall deliver or cause to be delivered to the Deal Agent a report (the “Backup
Servicer’s Monthly Report”), in form and substance satisfactory to Deal Agent, signed by an
officer of the Backup Servicer, stating that: (i) the Backup Servicer has loaded the Servicer’s
Data File as described in Section 2.1(a) on its hardware; (ii) a review of the Monthly
Report for
the related Distribution Date has been made under such officer’s supervision; (iii) the Backup
Servicer has received the Live Data File described in Section 2.6(a); and (iv) to such
officer’s knowledge: (x) the electronic media is in readable form; (y) with respect to the review
and verification set forth in Section 2.2(a) and 2.2(b), the data on the Servicer’s
Data File tie to the related Monthly Report resulting in no discrepancies between them; and (z) the
Monthly Report does not contain any errors in accordance with the review criteria set forth in
Section 2.2(a) hereunder. If the preceding statements cannot be made in the affirmative,
the applicable officer shall state the nature of any and all anomalies, discrepancies and errors,
and indicate all actions it is currently taking with the Servicer to reconcile and/or correct the
same. Each Backup Servicer’s Monthly Report shall be dated as of the related Determination Date.
Upon the request of the Deal Agent, a Backup Servicer’s Monthly Report shall be accompanied by
copies of any third party reports relied on or obtained in connection with the Backup Servicer’s
duties hereunder. The Backup Servicer, with respect to the Backup Servicer’s Monthly Report, shall
not be responsible for delays attributable to the failure of the Servicer or any other Person to
deliver information, defects in the information supplied by the Servicer or any other Person or
other circumstances beyond the control of the Backup Servicer. After the Assumption Date, the
Backup Servicer shall deliver the Monthly Report in accordance with the Loan Agreement.

     SECTION 2.11. Backup Servicer’s Expenses. The Backup Servicer shall be required to
pay all expenses incurred by it in connection with its activities hereunder, including fees and
disbursements of independent accountants, taxes imposed on the Backup Servicer and expenses
incurred in connection with distributions and reports to the Servicer and the Deal Agent. When the
Backup Servicer incurs expenses after the occurrence of a Servicer Termination Event or Termination
Event, in either case, under the Loan Agreement, the parties hereto intend that such expenses
constitute expenses of administration under the Bankruptcy Code or any other applicable Federal or
State bankruptcy, insolvency or similar law.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES

     SECTION 3.1. Representations and Warranties of the Backup Servicer. The Backup
Servicer represents, warrants and covenants as of the date of execution and delivery of this
Agreement:

          (a) Organization and Good Standing. The Backup Servicer has been duly organized and
is validly existing as a corporation in good standing under the laws of Delaware, with power,
authority and legal right to own its properties and to conduct its business as such properties are
currently owned and such business is currently conducted, and had at all relevant times, and now
has, power, authority and legal right to enter into and perform its obligations under this
Agreement or the Loan Agreement.

13

 

          (b) Due qualification. The Backup Servicer is duly qualified to do business as a
corporation in good standing, and has obtained all necessary licenses and approvals, in all
jurisdictions where the failure to do so would materially and adversely affect the performance of
its obligations under this Agreement or the Loan Agreement.

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

          (d) Binding Obligation. This Agreement shall constitute the legal, valid and binding
obligation of the Backup Servicer enforceable in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization or other similar laws
affecting the enforcement of creditors’ rights generally and by equitable limitations on the
availability of specific remedies, regardless of whether such enforceability is considered in a
proceeding in equity or at law.

          (e) No Violation. The execution and delivery of this Agreement, the consummation of
the transactions contemplated by this Agreement, and the fulfillment of the terms hereof, shall not
conflict with, result in any breach of any of the terms and provisions of, or constitute (with or
without notice or lapse of time, or both) a default under, the certificate of incorporation or
bylaws of the Backup Servicer, or any indenture, agreement, mortgage, deed of trust or other
instrument to which the Backup Servicer is a party or by which it is bound, or result in the
creation or imposition of any lien upon any of its properties pursuant to the terms of any such
indenture, agreement, mortgage, deed of trust or other instrument, other than this Agreement, or
violate any law, order, rule or regulation applicable to the Backup Servicer of any court or of any
federal or state regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Backup Servicer or any of its properties.

          (f) No Proceedings. There are no proceedings or investigations pending or, to the
Backup Servicer’s knowledge, threatened against the Backup Servicer, before any court, regulatory
body, administrative agency or other tribunal or governmental instrumentality having jurisdiction
over the Backup Servicer or its properties: (i) asserting the invalidity of this Agreement, (ii)
seeking to prevent the consummation of any of the transactions contemplated by this Agreement, or
(iii) seeking any determination or ruling that might materially and adversely affect the
performance by the Backup Servicer of its obligations under, or the validity or enforceability of,
this Agreement.

          (g) The Backup Servicer is not required to obtain the consent of any other party or any
consent, license, approval or authorization, or registration or declaration with, any governmental
authority, bureau or agency in connection with the execution, delivery, performance, validity or
enforceability of this Agreement.

          (h) Facilities. The Backup Servicer has adequate facilities and employees in place to
handle the following, in accordance with its Collection Guidelines, including, but not limited to:
(i) customer service inquiries/responsibilities; (ii) collections on delinquent and

14

 

charged-off
contracts; (iii) insurance monitoring and the making of claims with respect thereto; (iv) creating
the Monthly Reports; (v) repossession and other legal actions; (vi) statements to performing
accounts and other correspondence; (vii) reconciliation of dealer holdback payments; (viii)
inventory management; (ix) maintenance of lock-box accounts; (x) electronic skip tracing; and (xi)
document storage and title maintenance.

          (i) The Backup Servicer shall take all actions it deems necessary to commence servicing within
30 days of receipt of written notice from the Deal Agent, including without limitation, hiring and
training new personnel and purchasing any necessary equipment.

          (j) The Backup Servicer will keep gateways, hardware, software, systems and the interface used
to fulfill its obligations hereunder up-to-date as necessary to ensure continuing compatibility
with Credit Acceptance’s systems, utilized by Credit Acceptance in its capacity as Servicer, and
otherwise maintain a technology platform that will enable the Backup Servicer to fulfill its
obligations at all times, provided that the Backup Servicer will not be responsible for ensuring
compatibility with systems changed or modified by Credit Acceptance unless Credit Acceptance
notifies the Backup Servicer of such changes or modifications.

          (k) The Backup Servicer and all of its employees performing the services described hereunder
will perform such services in accordance with industry standards applicable to the performance of
such services, and with the same degree of care as it applies to the performance of such services
for any assets which the Backup Servicer holds for its own account.

          (l) Upon a Backup Servicer Event of Default, the Backup Servicer shall promptly (but in any
event within two (2) business days) notify the Servicer and the Deal Agent of such Backup Servicer
Event of Default.

ARTICLE 4

TERMINATION

     SECTION 4.1. Backup Servicer Event of Default.

          For purposes of this Agreement, any of the following shall constitute a “Backup Servicer
Event of Default”:

          (a) Failure on the part of the Backup Servicer duly to observe or perform in any material
respect any covenant or agreement of the Backup Servicer set forth in this Agreement, which failure
continues unremedied for a period of 30 days after the date on which the Backup Servicer shall have
actual knowledge thereof or written notice of such failure, requiring the same to be remedied,
shall have been given to the Backup Servicer by the Deal Agent.

          (b) Any failure by the Backup Servicer (x) after the Assumption Date to deposit to the
Collection Account any amount required to be deposited by the Servicer and such failure shall
continue unremedied for a period of two (2) days or (y) to deliver to the Deal Agent,

15

 

any Backup
Servicer’s Monthly Report on the related Distribution Date that shall continue unremedied for a
period of one (1) Business Day.

          (c) The entry of a decree or order by a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator, receiver, or liquidator for the
Backup Servicer in any insolvency, readjustment of debt, marshalling of assets and liabilities, or
similar proceedings, or for the winding up or liquidation of its respective affairs, and the
continuance of any such decree or order unstayed and in effect for a period of 60
consecutive days or the entry of any decree or order for relief in respect of the Backup
Servicer under any bankruptcy, reorganization, compromise, arrangement, insolvency, readjustment of
debt, or similar law, whether now or hereafter in effect, which decree or order for relief
continues unstayed and in effect for a period of 60 consecutive days.

          (d) The consent by the Backup Servicer to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities, or
similar proceedings of or relating to the Backup Servicer or relating to substantially all of its
property; or the admission by the Backup Servicer in writing of its inability to pay its debts
generally as they become due, the filing by the Backup Servicer of a petition to take advantage of
any applicable insolvency or reorganization statute, the making by the Backup Servicer of an
assignment for the benefit of its creditors, or the voluntarily suspension by the Backup Servicer
of payment of its obligations.

          (e) Any representation, warranty or statement of the Backup Servicer made in this Agreement or
any certificate, report or other writing delivered by the Backup Servicer pursuant hereto shall
prove to be incorrect in any material respect as of the time when the same shall have been made
and, within 30 days after written notice thereof shall have been given to the Backup Servicer by
the Deal Agent, the circumstances or condition in respect of which such representation, warranty or
statement was incorrect shall not have been eliminated or otherwise cured.

     SECTION 4.2. Consequences of a Backup Servicer Event of Default.

          If a Backup Servicer Event of Default has occurred and is continuing, the Deal Agent may, by
notice given in writing to the Backup Servicer, terminate all of the rights and obligations of the
Backup Servicer under this Agreement. On or after the receipt by the Backup Servicer of such
written notice, all authority, power, obligations and responsibilities of the Backup Servicer under
this Agreement shall be terminated. The terminated Backup Servicer agrees to cooperate with the
Deal Agent in effecting the termination of the responsibilities and rights of the terminated Backup
Servicer under this Agreement.

     SECTION 4.3. Backup Servicing Termination.

          Prior to the time the Backup Servicer receives a notice from the Deal Agent that the Backup
Servicer will become the Servicer, the Backup Servicer may terminate this Agreement for any reason
in its sole judgment and discretion upon delivery of 90 days advance written notice to the Deal
Agent or the Collateral Agent of such termination.

16

 

     SECTION 4.4. Return of Confidential Information.

          Upon termination of this Agreement, the Backup Servicer shall, at the direction of the Deal
Agent, promptly return all written confidential information and any related electronic and written
files and correspondence in its possession as are related to this Agreement and the Service-Related
Activities contemplated hereunder. The Backup Servicer shall provide reasonable access to its
facilities and assistance to any successor servicer or other party assuming the servicing
responsibilities, provided, however, that such access shall not unreasonably
interfere with the Backup Servicer conducting its day to day operations.

ARTICLE 5

MISCELLANEOUS

     SECTION 5.1. Notices, Etc.

          (a) On and after the Assumption Date, Credit Acceptance hereby agrees to provide to the Backup
Servicer all notices required to be provided to the Servicer pursuant to the Loan Agreement and the
other Transaction Documents, as well as a hard copy sent by a nationally recognized courier service
with item tracking capability.

          (b) Except where telephonic instructions or notices are authorized herein to be given, all
notices, demands, instructions and other communications required or permitted to be given to or
made upon any party hereto shall be in writing and shall be sent electronically or by facsimile
transmission with a confirmation of the receipt thereof and shall be deemed to be given for
purposes of this Agreement on the day that the receipt of such facsimile transmission is confirmed
in accordance with the provisions of this Section 5.1. Unless otherwise specified in a
notice sent or delivered in accordance with the foregoing provisions of this Section, notices,
demands, instructions (including payment instructions) and other communications in writing shall be
given to or made upon the respective parties hereto at their respective addresses and accounts
indicated below, and, in the case of telephonic instructions or notices, by calling the telephone
number or numbers indicated for such party below:

	 	 	 
	If to the Borrower:
	 	 
	 

	 	CAC Warehouse Funding III, LLC
	 

	 	Silver Triangle Building
	 

	 	25505 West Twelve Mile Road
	 

	 	Southfield, Michigan 48034-8339
	 

	 	Attention: Wendy A. Rummler
	 

	 	Telephone: (248) 353-2700 (ext. 4217)
	 

	 	Telecopy: (866) 249-3138
	 
	 	 
	If to the Servicer:
	 	 
	 

	 	Credit Acceptance Corporation
	 

	 	Silver Triangle Building
	 

	 	25505 West Twelve Mile Road, Suite 3000
	 

	 	Southfield, Michigan 48034-8339

17

 

	 	 	 
	 

	 	Attention: Wendy A. Rummler
	 

	 	Telephone: (248) 353-2700 (ext. 4217)
	 

	 	Telecopy: (866) 249-3138
	 
	 	 
	If to the Collateral Agent:
	 
	 	 
	 

	 	Fifth Third Bank
	 

	 	38 Fountain Square Plaza
	 

	 	MD 109046
	 

	 	Cincinnati, Ohio 45263
	 

	 	Attention: Brian Gardner
	 

	 	Facsimile No.: (513) 534-0319
	 

	 	Confirmation No: (513) 534-7949
	 
	 	 
	If to the Deal Agent:
	 
	 	 
	 

	 	Fifth Third Bank
	 

	 	38 Fountain Square Plaza
	 

	 	MD 109046
	 

	 	Cincinnati, Ohio 45263
	 

	 	Attention: Brian Gardner
	 

	 	Facsimile No.: (513) 534-0319
	 

	 	Confirmation No: (513) 534-7949
	 
	 	 
	If to the Backup Servicer:
	 
	 	 
	 

	 	Systems & Services Technologies, Inc.
	 

	 	4315 Pickett Road
	 

	 	St. Joseph, MO 64503
	 

	 	Attention:      John Chappell, President,
	 

	 	                       Joseph Booz, EVP/General Counsel
	 

	 	Facsimile:       (816) 671-2029
	 

	 	Telephone:     (816) 671-2022; (816) 671-2028
	 
	 	 
	 

	 	with a copy to:
	 

	 	NCO Group, Inc.
	 

	 	507 Prudential Road
	 

	 	Horsham, Pennsylvania 19044
	 

	 	Attn: Joshua Gindin, EVP/General Counsel

     SECTION 5.2. Successors and Assigns. This Agreement shall be binding upon the Backup
Servicer, and shall inure to the benefit of the Collateral Agent, the Secured Parties and their
respective successors and permitted assigns.

     SECTION 5.3. No Bankruptcy Petition Against the Borrower. The parties hereto agree
that until one year and one day after the Collection Date, they shall not: (i) institute the filing
of a bankruptcy petition against the Borrower based upon any claim in its favor arising hereunder
or

18

 

under the Transaction Documents; (ii) file a petition or consent to a petition seeking relief on
behalf of the Borrower under the Bankruptcy Law; or (iii) consent to the appointment of a receiver,
liquidator, assignee, trustee, sequestrator (or similar official) of the Borrower or any portion of
the property of the Borrower. The parties hereto agree that all obligations of the Borrower are
non-recourse to the Borrower except as specifically set forth in the Transaction Documents.

     SECTION 5.4. [Intentionally Omitted]

     SECTION 5.5. Severability Clause. Any provisions of this Agreement which are
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, 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 5.6. Amendments. This Agreement and the rights and obligations of the parties
hereunder may not be changed orally but only by an instrument in writing signed by the parties
hereto.

     SECTION 5.7. GOVERNING LAW; SUBMISSION TO JURISDICTION. (a) THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING
EFFECT TO THE CONFLICTS OF LAW PRINCIPLES THEREOF.

     (b) EACH OF THE PARTIES HERETO HEREBY SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE UNITED
STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND OF ANY NEW YORK STATE COURT SITTING
IN THE CITY OF NEW YORK FOR PURPOSES OF ALL LEGAL PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO, ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT AND ANY CLAIM THAT
ANY SUCH PROCEEDING BROUGHT IN SUCH A COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING IN
THIS SECTION 5.7(b) SHALL AFFECT THE RIGHT OF ANY PARTY TO BRING ANY ACTION OR PROCEEDING AGAINST
ANY OTHER PARTY OR ITS RESPECTIVE PROPERTIES IN THE COURTS OF OTHER JURISDICTIONS.

     SECTION 5.8. No Petition. Each of the parties hereto (other than the Deal Agent and
each CP Entity) hereby agrees that it will not institute against, or join any other Person in
instituting against the Borrower any Insolvency Proceeding so long as there shall not have elapsed
one year and one day since the Collection Date. The agreements set forth in this Section
5.8 and the parties’ respective obligations under this Section 5.8 shall survive the
termination of this Agreement.

19

 

     SECTION 5.9. Counterparts. This Agreement may be executed in any number of copies,
and by the different parties hereto on the same or separate counterparts, each of which shall be
deemed to be an original instrument.

     SECTION 5.10. Headings. Section headings used in this Agreement are for convenience
of reference only and shall not affect the construction or interpretation of this Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

20

 

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

	 	 	 	 	 
	 	CREDIT ACCEPTANCE CORPORATION,

     as Servicer

 	 
	 	By:  	/s/ Douglas W. Busk
 	 
	 	 	Name:  	Douglas W. Busk 	 
	 	 	Title:  	Treasurer 	 
	 
	 	SYSTEM & SERVICES TECHNOLOGIES, INC.,

     as Backup Servicer

 	 
	 	By:  	/s/ Joshua Gindin
 	 
	 	 	Name:  	Joshua Gindin 	 
	 	 	Title:  	Secretary 	 
	 
	 	FIFTH THIRD BANK,

     as Collateral Agent and as Deal Agent

 	 
	 	By:  	/s/ Brian Gardner
 	 
	 	 	Name:  	Brian Gardner 	 
	 	 	Title:  	Vice President 	 
	 
	 	CAC WAREHOUSE FUNDING III, LLC,

     as Borrower

 	 
	 	By:  	/s/ Douglas W. Busk
 	 
	 	 	Name:  	Douglas W. Busk 	 
	 	 	Title:  	Treasurer 	 
	 

[Backup Servicing Agreement Signature Page]

 

 

Exhibit I

Backup Servicer Certification

iiexv4wxfyx111y

CONTRIBUTION AGREEMENT

     This CONTRIBUTION AGREEMENT, dated as of May 23, 2008 (the “Agreement”), is made
between CREDIT ACCEPTANCE CORPORATION, a Michigan corporation (“CAC”) and CAC WAREHOUSE
FUNDING III, LLC, a Delaware limited liability company (“Funding”).

     Funding desires to acquire from time to time certain Loans and related rights and collateral,
including, but not limited to, certain of CAC’s rights in any related Dealer Agreements and
Purchase Agreements, all of the related Contracts, and the Collections (other than Dealer
Collections) derived therefrom during the full term of this Agreement, and CAC desires to transfer,
convey and assign from time to time such Loans and related property to Funding upon the terms and
conditions hereinafter set forth. CAC has also agreed to service the Loans and related property to
be transferred, conveyed and assigned to Funding.

     In consideration of the premises and the mutual agreements set forth herein, it is hereby
agreed by and between CAC and Funding as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Definitions. All capitalized terms used herein shall have the respective
meanings specified herein or, if not so specified, the respective meanings specified in, or
incorporated by reference into the Loan and Security Agreement and shall include in the singular
number the plural and in the plural number the singular:

     “Contributed Property” means the Initial Contributed Property and the Subsequent
Contributed Property.

     “Initial Contributed Property” means (i) the Loans listed on Exhibit A hereto
delivered to the Servicer, the Collateral Agent and the Backup Servicer on the Initial Funding Date
and (ii) all Related Security with respect thereto.

     “Initial Funding Date” means date of the Initial Funding, May ___, 2008.

     “Loan and Security Agreement” shall mean the Loan and Security Agreement dated as of
May 23, 2008, among Funding, CAC, the Investors named therein, the CP Entities named therein, Fifth
Third Bank, Relationship Funding Company, LLC and Systems & Services Technologies, Inc., as
amended, supplemented and otherwise modified from time to time.

     “Related Security” With respect to any Loan all of CAC’s interest in:

          (i) the Dealer Agreements (other than Excluded Dealer Agreement Rights, but including, without
limitation, CAC’s rights to service the Loans and the related Contracts and receive the related
collection fee and receive reimbursement of certain repossession and recovery expenses, in accordance with the terms of the Dealer Agreements) and Contracts securing
payment of such Loan;

 

 

          (ii) all security interests or liens purporting to secure payment of such Loan, whether
pursuant to such Loan, the related Dealer Agreement or otherwise, together with all financing
statements signed by the related Obligor describing any collateral securing such Loan and all other
property obtained upon foreclosure of any security interest securing payment of such Loan or any
related Contract;

          (iii) all guarantees, insurance (including insurance insuring the priority of perfection of
any lien) or other agreements or arrangements of any kind from time to time supporting or securing
payment of each Contract whether pursuant to such Contract or otherwise; including any of the
foregoing relating to any Contract securing payment of such Loan;

          (iv) all of CAC’s interests in all Records, documents and writing evidencing or related to
such Loan;

          (v) all Collections (other than Dealer Collections), the Collection Account, the Reserve
Account, and all amounts on deposit therein and investments thereof; and

          (vi) the Proceeds of each of the foregoing.

For the avoidance of doubt, the term “Related Security” with respect to any Dealer Loan includes
all rights arising after the end of the Revolving Period under such Dealer Loan which rights are
attributable to advances made under such Dealer Loan as the result of Dealer Loan Contracts being
added after the last date of the last full Collection Period during the Revolving Period to the
identifiable group of Dealer Loan Contracts to which such Loan relates.

     “Subsequent Contributed Property” means, with respect to the date of any Incremental
Funding, (i) the Loans added to Exhibit A hereto as of the date of such Incremental Funding, and
(ii) all Related Security with respect thereto.

     Section 1.2 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, and not specifically
defined herein, are used herein as defined in such Article 9.

     Section 1.3 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 means “to but excluding.”

ARTICLE II

CONTRIBUTION AND SERVICING OF LOANS

     Section 2.1 Contribution and Sale of Loans.

     (a) In consideration of the payments described in Section 3.1, effective as of the Initial
Funding Date, CAC did and hereby does contribute, convey, assign, sell and transfer to

2

 

Funding
without recourse, except as set forth herein, to Funding all of its right, title and interest in
and to (whether now owned or hereafter acquired or arising and wherever located) the Initial
Contributed Property.

     (b) CAC hereby further agrees that on the date of each Incremental Funding, in consideration
of the payment described in Section 3.1 with respect to the date of such Incremental Funding, CAC
shall and CAC does hereby agree to, contribute, convey, assign, sell and transfer to Funding
without recourse, except as set forth in this Agreement, to Funding all of its right, title and
interest in and to (whether now owned or hereafter acquired or arising and wherever located) the
Subsequent Contributed Property on and as of the date of such Incremental Funding.

     (c) Except as specifically provided in this Agreement, the sale and purchase of Contributed
Property under this Agreement shall be without recourse to CAC; it being
understood that CAC shall be liable to Funding for all representations, warranties,
covenants and indemnities made by CAC pursuant to the terms of this Agreement, all of which
obligations are limited so as not to constitute recourse to CAC for the credit risk of the
Obligors.

     (d) CAC hereby further agrees that the above-described conveyances shall, without the need for
any further action on the part of CAC or Funding, include all rights arising after the end of the
Revolving Period under any Dealer Loan included in the Initial Contributed Property or Subsequent
Contributed Property which rights are attributable to advances made under such Dealer Loans as the
result of Contracts being added after the last day of the last full Collection Period during the
Revolving Period to the identifiable group of Contracts to which such Dealer Loan relates.

     (e) Each such contribution, sale, assignment, transfer and conveyance does not constitute an
assumption by Funding (or any of its assigns) or any other Secured Party under the Loan and
Security Agreement of any obligations of CAC or any other Person to Obligors or to any other Person
in connection with the Loans or under any Contract, Dealer Agreement, Purchase Agreement or other
agreement and instrument relating to the Loans.

     (f) In connection with any such foregoing conveyance, CAC agrees to record and file on or
prior to the Initial Funding Date, at its own expense, a financing statement or statements with
respect to the Contributed Property conveyed by CAC hereunder meeting the requirements of
applicable state law in such manner and in such jurisdictions as are necessary to perfect the
interests of Funding created hereby, and to deliver either the originals of such financing
statements or a file-stamped copy of such financing statements or other evidence of such filings to
Funding on or before the Initial Funding Date.

     (g) CAC agrees that from time to time, at its expense, it will promptly execute and deliver
all instruments and documents and take all actions as may be necessary or as Funding may reasonably
request in order to perfect or protect the interest of Funding in the Loans and other Contributed
Property purchased hereunder or to enable Funding to exercise or enforce any of its rights
hereunder. CAC shall, upon request of Funding, obtain such additional search

3

 

reports as Funding shall request. To the fullest extent permitted by applicable law, Funding
shall be and is hereby authorized and permitted to file continuation statements and amendments to
financing statements and assignments thereof to preserve and protect its right, title and interest
in, to and under the Contributed Property.

     (h) It is the express intent of CAC and Funding that the conveyance of the Loans and other
Contributed Property by CAC to Funding pursuant to this Agreement be construed as an absolute sale
and contribution of such Loans and other Contributed Property by CAC to Funding. Further, it is
not the intention of CAC and Funding that such conveyance be deemed a grant of a security interest
in the Loans and other Contributed Property by CAC to Funding in the nature of a consensual lien
securing an obligation. However, in the event that, notwithstanding the express intent of the
parties, the Loans and other Contributed Property are construed to constitute property of CAC, then
(i) this Agreement also shall be deemed to be, and hereby is, a security agreement within the
meaning of the UCC as enacted in the State of Michigan and any other applicable jurisdiction; and
(ii) the conveyance by CAC provided for in this Agreement shall be deemed to be, and CAC hereby
grants to Funding, a security interest in, to and under all of CAC’s right, title and interest in,
to and under the Contributed Property, to secure the rights of Funding set forth in this Agreement
or as may be determined in connection therewith by applicable law. CAC and Funding shall, to the
extent consistent with this Agreement, take such actions as may be necessary to ensure that, if
this Agreement were deemed to create such a security interest in the Loans and other Contributed
Property, such security interest would be a perfected security interest in favor of Funding under
applicable law and will be maintained as such throughout the term of this Agreement and until the
earlier of such time as Funding shall have received all Collections or CAC shall have purchased the
Loans and other Contributed Property pursuant to a Clean-up Call.

     (i) In connection with such conveyance, CAC agrees to deliver to Funding on the Initial
Funding Date, one or more computer files or microfiche lists containing true and complete lists of
all applicable Dealer Agreements and Loans conveyed to Funding on the Initial Funding Date, and all
Contracts securing all such Loans, identified by, as applicable, account number, dealer number and
pool number. Such file or list shall be marked as Exhibit A to this Agreement, shall be delivered
to Funding as confidential and proprietary, and is hereby incorporated into and made a part of this
Agreement. Such list and such Exhibit A shall be supplemented and updated by lists delivered by
CAC to Funding on the date of each Incremental Funding in the Revolving Period describing all
Contributed Property conveyed on the date of each such Incremental Funding so that, on each such
date, Funding will have an aggregate list and Exhibit A that describes all Loans conveyed by CAC to
Funding hereunder on or prior to said date of Incremental Funding, any related Dealer Agreements,
the related Purchase Agreements and all Contracts securing all such Loans.

     (j) CAC will reflect the transactions described in paragraph (a) of this Section 2.1 on its
internal non-consolidated financial statements and on its non-consolidated state tax returns as a
sale or other absolute transfer or contribution of the Loans from CAC to Funding, even though CAC
will reflect this transaction on its consolidated financial statements as an “on-balance sheet”
item in accordance with generally accepted accounting principles. CAC will present the data in

4

 

its
consolidated financial statements with an accompanying footnote describing Funding’s
separate existence and stating that such item is a financing secured by the Loans and is
non-recourse to CAC.

     (k) Each of CAC and Funding represents and warrants as to itself that each remittance of
amounts by CAC to Funding under this Agreement will have been (x) in payment of a debt incurred by
Funding in the ordinary course of business or financial affairs of Funding and CAC and (y) made in
the ordinary course of business or financial affairs of Funding and CAC.

     Section 2.2 Servicing of Loans. The servicing, administering and collection of the
Loans shall be conducted by the Servicer then authorized to act as such under the Loan and Security
Agreement.

ARTICLE III

CONSIDERATION AND PAYMENT

     Section 3.1 Consideration. The consideration for the Loans and other Contributed
Property conveyed on the Initial Funding Date to Funding by CAC under this Agreement shall be an
amount equal to (i) the net cash proceeds of each advance to Funding under the Loan and Security
Agreement used by Funding to purchase the Loans and other Contributed Property conveyed on the
Initial Funding Date, plus (ii) 100% of the sole membership interest in Funding.
Thereafter, on the date of each Incremental Funding in the Revolving Period, the consideration for
the Loans and other Contributed Property conveyed on the date of such Incremental Funding will be
cash in the amount of (i) the Aggregate Outstanding Eligible Loan Net Balance of such Loans,
plus (ii) 100% of the sole membership interest in Funding. The Contributed Property shall
be deemed to have a fair value equal to the aggregate principal amount of the Loans sold and
contributed by CAC to Funding.

     Section 3.2 Membership Interest. The membership interest of CAC in Funding shall
arise on the Initial Funding Date. Such membership interest may not be sold or otherwise
transferred by CAC except as otherwise permitted in the Loan and Security Agreement.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES

     Section 4.1 Representations and Warranties. CAC represents and warrants to Funding,
for the benefit of Funding and each of its successors and assigns, as of the Closing Date, the
Initial Funding Date and the date of each Incremental Funding, that:

     (a) Organization and Good Standing. CAC is duly organized and is validly existing as
a corporation in good standing under the laws of the State of Michigan, with power and authority to
own its properties and to conduct its business as such properties are currently owned and such
business is presently conducted, and has and had at all relevant times, full power, authority, and
legal right to acquire, own, sell, and service the Loans and the related Contracts, and to perform
its obligations under the Transaction Documents.

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     (b) Due Qualification. CAC is duly qualified to do business as a foreign corporation
in good standing, and has obtained all necessary licenses and approvals in all jurisdictions in
which the ownership or lease of property or the conduct of its business, including the
servicing of the Loans and the related Contracts as required by this Agreement, requires such
qualifications except where such failure will not have a Material Adverse Effect.

     (c) Power and Authority; Due Authorization. CAC (i) has all necessary power,
authority and legal right to: (A) execute and deliver this Agreement and the other Transaction
Documents to which it is a party, (B) carry out the terms of the Transaction Documents to which it
is a party, and (C) transfer and contribute each Loan and all other Related Security on the terms
and conditions herein provided and (ii) has duly authorized by all necessary action the execution,
delivery and performance of this Agreement and the other Transaction Documents to which it is a
party and the transfer and contribution of the Loans and all other Related Security on the terms
and conditions herein provided. This Agreement and each other Transaction Document to which it is
a party have been duly executed and delivered by it.

     (d) Valid Sale; Binding Obligations. This Agreement evidences a valid sale,
contribution, transfer, and assignment of the Contributed Property and this Agreement and the other
Transaction Documents to which CAC is a party constitute legal, valid and binding obligations of
CAC enforceable in accordance with their terms, subject to the effects of bankruptcy, insolvency,
reorganization, or other similar laws affecting the enforcement of creditors’ or secured creditors’
rights generally and to general principles of equity.

     (e) No Violation. The execution, delivery and consummation of the transactions
contemplated by this Agreement and the other Transaction Documents to which it is a party and the
fulfillment of the terms hereof and thereof do not conflict with, result in any breach of any of
the terms and provisions of, or constitute (with or without notice or lapse of time) a default
under, the Articles of Incorporation or by-laws of CAC, or any indenture, agreement, or other
instrument to which CAC is a party or by which it is or may be bound; nor result in the creation or
imposition of any Lien upon any of its properties pursuant to the terms of any such indenture,
agreement (other than this Agreement), or other instrument; or violate any law or, to the best of
CAC’s knowledge, any order, rule, or regulation applicable to CAC of any court or of any federal or
state regulatory body, administrative agency, or other governmental instrumentality having
jurisdiction over CAC or its properties.

     (f) No Proceedings. There are no proceedings or investigations pending, or to CAC’s
best knowledge threatened, before any court, regulatory body, administrative agency, or other
governmental instrumentality having jurisdiction over CAC or its properties: A) asserting the
invalidity of this Agreement or any other Transaction Document to which it is a party; B) seeking
to prevent the consummation of any of the transactions contemplated by this Agreement or any other
Transaction Document to which it is a party; or C) seeking any determination or ruling that might
materially and adversely affect the performance by CAC of its obligations under, or the validity or
enforceability of, this Agreement, or any other Transaction Document to which it is a party.

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     (g) Solvency; Fraudulent Conveyance. CAC is solvent, is able to pay its debts as they
become due and will not be rendered insolvent by the transactions contemplated by the Transaction
Documents and, after giving effect thereto, will not be left with an unreasonably small amount of
capital with which to engage in its business. CAC does not intend to incur, nor
does it believe that it has incurred, debts beyond its ability to pay such debts as they
mature. CAC does not contemplate the commencement of insolvency, bankruptcy, liquidation or
consolidation proceedings or the appointment of a receiver, liquidator, conservator, trustee or
similar official or any of its assets. The amount of consideration being received by CAC upon the
sale or other absolute transfer of the Contributed Property to Funding constitutes reasonably
equivalent value and fair consideration for the Contributed Property. CAC is not transfering the
Contributed Property to Funding with any intent to hinder, delay or defraud any of its creditors.

     (h) Bulk Sales. The execution, delivery and performance of this Agreement and the
transactions contemplated hereby do not require compliance with any “bulk sales” act or similar law
by CAC.

     (i) Security Interest. As of the Initial Funding Date, CAC has granted a security
interest (as defined in the UCC as enacted in the State of Michigan) to Funding in the Contributed
Property, which is enforceable in accordance with Applicable Law. Upon the filing of UCC-1
financing statements naming Funding as secured party and CAC as debtor, Funding shall have a first
priority perfected security interest in the Contributed Property. All filings (including, without
limitation, UCC filings) as are necessary in any jurisdiction to perfect the interest of Funding in
the Contributed Property have been made.

     (j) Contribution Agreement. This Contribution Agreement is the only agreement
pursuant to which Funding purchases and or otherwise acquires Loans from CAC.

     (k) Perfection. As of the Initial Funding Date, CAC will be the owner of all of the
Loans and the other Contributed Property, free and clear of all Liens. On or prior to the date of
each contribution of Loans and the other Contributed Property to Funding pursuant to this
Agreement, all financing statements and other documents required to be recorded or filed in order
to perfect and protect the ownership interest of Funding in and to the Loans and the other
Contributed Property against all creditors of and purchasers from CAC will have been duly filed in
each filing office necessary for such purpose and all filing fees and taxes, if any, payable in
connection with such filings shall have been paid in full.

     (l) Accuracy of Information. All information with respect to the Loans and other
Contributed Property (and the transactions contemplated hereby and thereby) provided to Funding
hereunder by CAC was true and correct in all material respects as of the date such information was
provided to Funding and did not omit to state any material facts necessary to make the statements
contained therein not misleading.

     (m) Taxes. CAC has filed on or before their respective due dates, all tax returns
which are required to be filed in any jurisdiction or has obtained extensions for filing such tax
returns and has paid all taxes, assessments, fees and other governmental charges against CAC or

7

 

any
of its properties, income or franchises, to the extent that such taxes have become due, other than
any taxes or assessments, the validity of which are being contested in good faith by appropriate
proceedings and with respect to which adequate provision has been made on the books of the Seller
as may be required by GAAP. To the best knowledge of CAC, all such tax returns were true and
correct in all material respects and CAC knows of no proposed material additional tax assessment
against it nor any basis therefor. Any taxes, assessments, fees and other
governmental charges payable by CAC in connection with the execution and delivery of the
Transaction Documents have been paid or shall have been paid at or prior to Closing Date.

     (n) Place of Business. The principal place of business and chief executive office
(and “location” for purposes of the applicable UCC) of CAC is in Southfield, Michigan, and the
office where CAC keeps all of its Records is at the address listed in Section 8.3, or such other
locations notified to Funding and the Deal Agent in accordance with this Agreement in jurisdictions
where all action required by the terms of this Agreement has been taken and completed.

     (o) Correct Legal Name. “Credit Acceptance Corporation” is the correct legal name of
CAC indicated on the public records of CAC’s jurisdiction of organization.

     (p) Accounting. CAC accounts for the transfers from it to Funding of Loans and
Related Security under the Contribution Agreement as sales or contributions to capital of such
Loans and Related Security in its internal non-consolidated financial statements and on its
non-consolidated state tax returns, although the financial statements of CAC and Funding are
consolidated in accordance with GAAP.

     (q) Good Title. Upon the contribution of the Loans and related property to Funding
pursuant to this Agreement, Funding shall acquire all of CAC’s ownership and other interest in each
Loan, and in the Related Security, Collections and proceeds with respect thereto, in each case free
and clear of any Lien.

     (r) Eligibility of Dealer Agreements. Each Dealer Agreement classified as an
“Eligible Dealer Agreement” (or included in any aggregation of balances of “Eligible Dealer
Agreements”) by CAC in any document or report delivered hereunder satisfied the requirements
contained in the definition of Eligible Dealer Agreement on the date so delivered.

     (s) Eligibility of Loans. Each Loan classified as an “Eligible Loan” (or included in
any aggregation of balances of “Eligible Loans”) by CAC in any document or report delivered
hereunder satisfied the requirements contained in the definition of Eligible Loan on the date so
delivered.

     (t) Eligibility of Contracts. Each Contract classified as an “Eligible Contract” (or
included in any aggregation of balances of “Eligible Contracts”) by CAC in any document or report
delivered hereunder satisfied the requirements contained in the definition of Eligible Contract on
the date so delivered.

     (u) Amount of Loans; Computer File. The Funding Notice shall provide (A) the
aggregate Outstanding Balance of the Contracts; (B) the Aggregate Outstanding Eligible Loan

8

 

Balance; and (C) the Aggregate Outstanding Eligible Loan Net Balance; each as of the Cut-off Date
and as reported in the Loan Servicing System. Exhibit A attached hereto is complete and acurately
reflects the information regarding the Loans, appliable Dealer Agreements and Contracts in all
material respects.

     (v) Material Adverse Change. Since March 31, 2008, no event or circumstance has
occurred that would have a Material Adverse Effect on (i) the business, condition (financial or
otherwise), operations, performance, properties or prospects of the Originator or the Servicer (ii)
the validity, enforceability or collectibility of this Agreement or any other Transaction
Document or the validity, enforceability or collectibility of the Loans, or (iii) the ability of
the Originator or of the Servicer to perfom its obligations under this Agreement or any Transaction
Document.

     (w) Not an Investment Company. CAC is not, and is not controlled by, an “investment
company” within the meaning of the Investment Company Act of 1940, as amended, or each is exempt
from all provisions of such Act.

     (x) ERISA. CAC is in compliance in all material respects with the Employee Retirement
Income Security Act of 1974, as amended.

     (y) Preference; Voidability. The transfer Contributed Property hereunder was not made
for or on account of an antecedent debt and such transfer is not voidable under any Section of the
Bankruptcy Code.

     (z) No Consents. With respect to each Loan and the other Contributed Property, all
consents, licenses, approvals or authorizations of or registrations or declarations with any
Governmental Authority required to be obtained, effected or given by CAC, in connection with the
pledge of such Contributed Property to Funding have been duly obtained, effected or given and are
in full force and effect.

     (aa) Exhibit A. Upon delivery, Exhibit A to this Agreement and each supplement or
addendum thereto will be an accurate and complete listing of all Loans and the related Contracts or
any related Dealer Agreements and Purchase Agreements in all material respects on the date each
such Loan was sold to Funding hereunder, and the information contained therein is and will be true
and correct in all material respects as of such date.

     (bb) Adverse Selection. No selection procedure believed by CAC to be adverse to the
interests of Funding has been or will be used in selecting the Loans or any Dealer Agreements or
Purchase Agreements.

     (cc) Use of Proceeds. None of the transactions contemplated herein (including,
without limitation, the use of the proceeds from the pledge of the Collateral) will violate or
result in a violation of Section 7 of the Securities Exchange Act, or any regulations issued
pursuant thereto, including, without limitation, Regulations T, U and X of the Board of Governors
of the Federal Reserve System, 12 C.F.R., Chapter II. CAC does not own or intend to carry or
purchase,
and no proceeds from the pledge of the Collateral will be used to carry or purchase,

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any “margin stock” within the meaning of Regulation U or to extend “purchase credit” within the meaning
of Regulation U.

     (dd) Credit Score. With respect to the purchase by Funding of Loans and Related
Security on each Payment Date during the Revolving Period, on each such Payment Date, immediately
after giving effect thereto, the weighted average of the Final Scores of all Contracts that are or
remain transferred on such distribution Date is 665 or greater.

     (ee) Consolidated Returns. CAC, the Seller and the Issuer are members of an
affiliated group within the meaning of Section 1504 of the Internal Revenue Code which will file
a consolidated federal income tax return at all times until the termination of the Basic
Documents.

     (ff) Compliance with Laws. CAC has complied in all material respects with all
applicable, laws, rules, regulations, orders, writs, judgments, injunctions, decrees or awards to
which it may be subject.

     Section 4.2 Reaffirmation of Representations and Warranties by CAC; Notice of Breach.
The representations and warranties set forth in Section 4.1 shall survive the conveyance of the
Loans to Funding, and termination of the rights and obligations of Funding and CAC under this
Agreement. Upon discovery by Funding or CAC of a breach of any of the foregoing representations
and warranties, the party discovering such breach shall give prompt written notice to the other
within three Business Days of such discovery.

ARTICLE V

COVENANTS OF CAC

     Section 5.1 Affirmative Covenants. So long as this Agreement is in effect, and until
all Loans, which have been conveyed to Funding pursuant hereto, shall have been paid in full or
written-off as uncollectible, and all amounts owed by CAC pursuant to this Agreement have been paid
in full, unless Funding and the Agent otherwise consent in writing, CAC hereby covenants and agrees
as follows:

     (a) Preservation of Corporate Existence; Conduct of Business. CAC will preserve and
maintain its existence, rights, franchises and privileges in the jurisdiction of its formation, and
qualify and remain qualified in good standing as a foreign corporation in each jurisdiction where
the failure to preserve and maintain such existence, rights, franchises, privileges and
qualification has had, or could reasonably be expected to have, a material adverse effect on the
Contributed Property.

     (b) Compliance with Laws. CAC will comply in all material respects with all
Applicable Laws.

     (c) Furnishing of Information and Inspection of Records. CAC will furnish to Funding
(and its assigns) from time to time such information with respect to the Loans as Funding (and its
assigns) may reasonably request, including, without limitation, listings

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identifying the Obligor
and the Outstanding Balance for each Loan. CAC will at any time and from time to time during
regular business hours permit Funding, the Deal Agent, or their agents or representatives, (i) to
examine and make copies of and abstracts from all Records and (ii) to visit the offices and
properties of CAC for the purpose of examining such Records, and to discuss matters relating to
Loans or CAC’s performance hereunder with any of the officers, directors, employees or independent
public accountants of CAC having knowledge of such matters.

     (d) Keeping of Records and Books of Account. CAC will maintain and implement
administrative and operating procedures (including without limitation, an ability to recreate
records evidencing the Loans and the Contracts in the event of the destruction of the originals
thereof), and keep and maintain all documents, books, records and other information reasonably
necessary or advisable for the collection of all Loans.

     (e) Obligations and Compliance with Loans, Dealer Agreements and Purchase Agreements.
CAC will duly fulfill and comply with all obligations on the part of CAC to be fulfilled or
complied with under or in connection with each Loan, each Dealer Agreement, each Purchase Agreement
and the other Basic Transaction Documents will do nothing to impair the rights of Funding (or its
assigns) in, to and under the Contributed Property.

     (f) Collection Guidelines. As long as it is the Servicer or otherwise acting in
respect of a Loan or Contract, CAC will (A) comply in all material respects with the Collection
Guidelines in regard to each Loan and Contract, and (B) furnish to Funding prompt notice of any
material change in the Collection Guidelines and deliver a copy of such changes to Funding
quarterly.

     (g) Preservation of Security Interest. CAC will file such financing and continuation
statements and any other documents that may be required by any law or regulation of any
Governmental Authority to preserve and perfect the security interest of Funding in, to and under
the Contributed Property. CAC will maintain possession of the Dealer Agreements, Purchase
Agreements and the Contract Files and Records, as custodian for the Collateral Agent, as set forth
in Section 6.2(c) of the Loan and Security Agreement. CAC, as Servicer, will comply with its
covenants under Section 5.4(d) of the Loan and Security Agreement.

     (h) Separateness. CAC will take such actions that are required on its part to be
performed to cause (i) Funding to be in compliance, at all relevant times, with Section 5.2(o) of
the Loan and Security Agreement, and (ii) all factual assumptions set forth in the opinion letters
delivered by Dykema Gossett PLLC on the date hereof with respect to certain bankruptcy matters to
remain true at all relevant times.

     Section 5.2 Negative Covenants. During the term of this Agreement, unless Funding and
the Agent shall otherwise consent in writing:

     (a) No Sales, Liens, Etc. Except as otherwise provided herein, CAC will not sell,
assign (by operation of law or otherwise) or otherwise dispose of, or create or suffer to exist any

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Lien upon (or the filing of any financing statement) or with respect to (i) any of the Loans, the
Related Security, Collections or other Contributed Property, (ii) any goods (other than inventory),
the sale, which may give rise to any Loan, Related Security or Collections or other Contributed
Property or (iii) any account to which any Collections of any Loan are sent, or, in each case,
assign any right to receive income in respect thereof. CAC shall, and will cause each of its
Subsidiaries to, specifically exclude from the property subject to any Lien granted on inventory
any and all accounts receivable generated by sales of such inventory and the proceeds thereof and
shall provide, upon Funding’s request, evidence satisfactory to Funding that any such Lien (and
each related UCC financing statement or other related filing) expressly excludes any such accounts
receivable. CAC will provide Funding and the Deal Agent with a copy of any inventory financing
agreement at least three Business Days prior to the effectiveness thereof.

     (b) Credit Guidelines and Collection Guidelines. CAC will not amend, modify, restate
or replace, in whole or in part, the Credit Guidelines or Collection Guidelines, which change would
impair the collectibility of any Loan or Contract or otherwise adversely affect the interests or
the remedies of Funding under this Agreement or any other Transaction Document, unless such change
is permitted under the Loan and Security Agreement and unless CAC obtains the prior written consent
of Funding and the Deal Agent.

     (c) Change in Payment Instructions to Obligors. CAC will not make any change in its
instructions to Obligors regarding payments to be made directly or indirectly, unless such change
is permitted under the Loan and Security Agreement and Funding and CAC have each consented to such
change in writing and have received duly executed documentation related thereto.

     (d) Change of Name, Etc. CAC will not change its name, identity, jurisdiction of
organization or structure or location of its chief executive office, unless at least ten (10) days
prior to the effective date of any such change CAC delivers to Funding and the Deal Agent such
documents, instruments or agreements, including, without limitation, appropriate financing
statements under the UCC, executed by CAC, as are necessary to reflect such change and to continue
the perfection of Funding’s and any assignee’s interest in the Loans.

     (e) Separate Business. CAC will not: (i) fail to maintain separate books, financial
statements, accounting records and other corporate documents from those of Funding; (ii) commingle
any of its assets or the assets of any of its Affiliates with those of Funding; (iii) pay from its
own assets any obligation or indebtedness of any kind incurred by Funding; (iv) directly, or
through any of its Affiliates, borrow funds or accept credit or guaranties from Funding.

12

 

     Section 5.3 Indemnities by CAC.

     (a) Without limiting any other rights that any such Person may have hereunder or under
Applicable Law, CAC hereby agrees to indemnify Funding, or its assignee, and each of their
respective Affiliates and officers, directors, employees and agents thereof (collectively, the
“Indemnified Parties”), forthwith on demand, from and against any and all damages, losses,
claims, liabilities and related costs and expenses, including attorneys’ fees and disbursements
(all of the foregoing being collectively referred to as the “Indemnified Amounts”) awarded
against or incurred by such Indemnified Party or other non-monetary damages of any such Indemnified
Party arising out of or as a result of this Agreement or in respect of any Contributed Property,
excluding, however, (a) Indemnified Amounts to the extent resulting from gross
negligence or willful misconduct on the part of such Indemnified Party or (b) Indemnified Amounts
that arise as a result of non-payment of Loans due to credit problems of the Dealers or Obligors.
If CAC has made any indemnity payment pursuant to this Section 5.3 and such payment fully
indemnified the recipient thereof and the recipient thereafter collects any payments from others in
respect of such Indemnified Amounts then, the recipient shall repay to CAC an amount equal to the
amount it has collected from others in respect of such indemnified amounts. Without limiting the
foregoing, CAC shall indemnify each Indemnified Party for Indemnified Amounts relating to or
resulting from:

          (i) any Contract or Loan treated as or represented by CAC to be an Eligible Contract or
Eligible Loan that is not at the applicable time an Eligible Contract or Eligible Loan;

          (ii) any representation or warranty made or deemed made by CAC or any of its officers under or
in connection with this Agreement, which shall have been false or incorrect in any respect when
made or deemed made or delivered;

          (iii) the failure by CAC 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,
with respect to any Loan, Dealer Agreement, Purchase Agreement or Contract, or the nonconformity of
any Loan, Dealer Agreement Purchase Agreement or Contract with any such Applicable Law;

          (iv) the failure to vest and maintain vested in Funding, or its assignees, a first priority
perfected ownership in the Contributed Property, free and clear of any Lien;

          (v) 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 the Contributed Property, whether on the Initial Funding Date or at any subsequent time;

          (vi) any dispute, claim, offset or defense (other than the discharge in bankruptcy of the
Dealer or Obligor) of the relevant Dealer or Obligor to the payment of any Loan or Contract
(including, without limitation, a defense based on such Loan or Contract not

13

 

being a legal, valid and binding obligation of such Obligor enforceable against it in
accordance with its terms);

          (vii) any failure of CAC to perform its duties or obligations in accordance with the
provisions of this Agreement or any failure by CAC to perform its respective duties under the
Loans;

          (viii) the failure by CAC to pay when due any taxes for which CAC is liable, including without
limitation, sales, excise or personal property taxes payable in connection with the Contributed
Property;

          (ix) the commingling of Collections of the Loans and Contracts at any time with other funds;

          (x) any investigation, litigation or proceeding related to this Agreement or in respect of any
Loan or Contract;

          (xi) the failure of CAC, in its individual capacity, or any of its agents or representatives
to remit to the Servicer, the Deal Agent, or the Collateral Agent Collections of the Loans and
Contracts remitted to CAC, in its individual capacity, or any such agent or representative; and

          (xii) the failure of a Contract File to contain the relevant original Contract.

     Notwithstanding the foregoing, CAC shall have no indemnification obligation hereunder with
respect to (x) the purchase price, principal balance or value of any Loan or
Contract in respect of which CAC shall have paid the Release Price hereunder pursuant to Article VI
or under the Loan and Security Agreement after the date of such payment or (y) any indemnifiable
amount paid or payable by CAC as Servicer pursuant to the Loan and Security Agreement.

     (b) Any amounts subject to the indemnification provisions of this Section 5.3 shall be paid by
CAC to the Indemnified Party within five (5) Business Days following the the Indemnified Party’s
demand therefor.

     (c) The obligations of CAC under this Section 5.3 shall survive the termination of this
Agreement.

ARTICLE VI

REPURCHASE OBLIGATION

     Section 6.1 Mandatory Repurchase upon Breach of Warranty. If any Loan, which has been
sold, assigned and/or contributed to Funding by CAC hereunder and which has been reported by CAC to
be an Eligible Loan, shall fail to meet the conditions set forth in the definition of “Eligible
Loan”, as applicable, on the date of such report or for which any representation or warranty made
herein in respect of such Loan shall fail to be true on the date so made, then no later than the
earlier of (i) knowledge by CAC of such Loan not being an “Eligible

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Loan” or such representation or warranty failing to be true or (ii) receipt by CAC from
Funding, the Deal Agent, the Collateral Agent or the Servicer of written notice thereof, CAC shall
be deemed to have received on such day a Collection of such Loan in full and shall on such day pay
to Funding an amount equal to the Release Price of such Loan. If on any day any Contract, which
has been sold, assigned and/or contributed to Funding by CAC hereunder and which has been reported
by CAC to be an Eligible Contract, shall fail to meet the conditions set forth in the definition of
“Eligible Contract” or any report or for which any representation or warranty made, herein in
respect of such Contract shall fail to be true on the date so made, then no later than the earlier
of (i) knowledge by CAC of such Contract not being an “Eligible Contract” or such representation or
warranty failing to be true or (ii) receipt by CAC from Funding, the Deal Agent, the Collateral
Agent or the Servicer of written notice thereof, CAC shall be deemed to have received on such day a
Collection in the amount of the Release Price of such Contract and shall on such day pay to Funding
an amount equal to the Release Price of such Contract. For purposes of this Section 6.1, Release
Price shall be calculated as of the last day of the immediately preceding collection period. Upon
the request of CAC, Funding shall release its security interest on the Loans and the Contracts for
which payment has been made in accordance with this Section 6.1; provided, however,
that any Collections relating to any such Loans accrued through the date of the release of the
security interest in such Loans shall continue to be owned by Funding.

     Section 6.2 Retransfer of All of the Loans. In the event of a breach of any
representation or warranty set forth in Sections 4.1(q), 4.1(r) or 4.1(s), which breach could
reasonably be expected to have a Material Adverse Effect then, on or prior to the applicable
Release Date, CAC shall pay to Funding the Retransfer Amount due on the applicable Release Date.
On such Release Date, provided that the conditions precedent to the release have been satisfied,
the Loans and Related Security related thereto shall be transferred to CAC; and Funding shall, at
the sole expense of CAC, execute and deliver such instruments of transfer, in each case without
recourse, representation or warranty, as shall be prepared and reasonably requested by CAC to vest
in CAC, or its designee or assignee, all right, title and interest of Funding in, to and under the
Loans.

     Section 6.3 No Recourse. Except as otherwise provided in this Article VI, the
purchase and sale of the Loans under this Agreement shall be without recourse to CAC or the
Servicer.

ARTICLE VII

CONDITIONS PRECEDENT

     Section 7.1 Conditions to Funding’s Obligations Regarding Loans. Consummation of the
transactions contemplated hereby on the Closing Date, the Initial Funding Date and, where
applicable, on the date of each Incremental Funding, shall be subject to the satisfaction of the
following conditions:

     (a) All representations and warranties of CAC contained in this Agreement shall be true and
correct on the Closing Date, the Initial Funding Date and the date of each Incremental

15

 

Funding with the same effect as though such representations and warranties had been made on
such date and the date of each Incremental Funding;

     (b) With respect to those Loans contributed on the Initial Funding Date and the date of each
Incremental Funding, all information concerning such Loans provided to Funding shall be true and
correct in all material respects as of the Initial Funding Date and the date of each Incremental
Funding;

     (c) CAC shall have substantially performed all other obligations required to be performed by
the provisions of this Agreement;

     (d) CAC shall have filed or caused to be filed, or shall have delivered for filing, the
financing statement(s) required to be filed pursuant to Section 2.1(e);

     (e) All corporate and legal proceedings and all instruments in connection with the
transactions contemplated by this Agreement shall be satisfactory in form and substance to Funding,
and Funding shall have received from CAC copies of all documents (including, without limitation,
records of corporate proceedings) relevant to the transactions herein contemplated as Funding may
reasonably have requested; and

     (f) On the Initial Funding Date, CAC shall deliver to Funding and the Deal Agent a Monthly
Report as of the Initial Funding Date.

ARTICLE VIII

MISCELLANEOUS PROVISIONS

     Section 8.1 Amendment. This Agreement and the rights and obligations of the parties
hereunder may not be changed orally, but only by an instrument in writing signed by Funding and CAC
and consented to in writing by the Deal Agent.

     This Agreement shall be governed by and construed in accordance with the laws of the State of
Michigan.

     Section 8.2 Notices. Except where telephonic instructions or notices are authorized
herein to be given, all notices, demands, instructions and other communications required or
permitted to be given to or made upon any party hereto shall be in writing and shall be sent by
facsimile transmission with a confirmation of the receipt thereof and shall be deemed to be given
for purposes of this Agreement on the day that the receipt of such facsimile transmission is
confirmed in accordance with the provisions of this Section 8.3. Unless otherwise specified in a
notice sent or delivered in accordance with the foregoing provisions of this Section, notices,
demands, instructions (including payment instructions) and other communications in writing shall be
given to or made upon the respective parties hereto at their respective addresses and accounts
indicated below, and, in the case of telephonic instructions or notices, by calling the telephone
number or numbers indicated for such party below:

     (a) in the case of Funding:

16

 

CAC Warehouse Funding III, LLC

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention:   Douglas W. Busk

Telephone:   (248) 353-2700 (ext. 4432)

Telecopy:   (866) 249-3138

with a copy to:

Fifth Third Bank

38 Fountain Square Plaza

MD 109046

Cincinnati, Ohio 45263

Attention:   Brian Gardner

Facsimile:   (513) 534-0319

     (b) in the case of CAC and in the case of the Servicer (for so long as the Servicer is CAC):

Credit Acceptance Corporation

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention: Douglas W. Busk

Telephone: (248) 353-2700 (ext. 4432)

Telecopy: (866) 249-3138

or, as to each party, at such other address as shall be designated by such party in a written
notice to each other party.

     Section 8.3 Severability of Provisions. If any one or more of the covenants,
agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid,
then such covenants, agreements, provisions, or terms shall be deemed severable from the remaining
covenants, agreements, provisions, or terms of this Agreement and shall in no way affect the
validity or enforceability of the other provisions of this Agreement.

     Section 8.4 Assignment. This Agreement may not be assigned by the parties hereto,
except that Funding may assign its rights hereunder pursuant to the Loan and Security Agreement to
the Collateral Agent or the Deal Agent, for the benefit of RFC, the Secured Parties and any
Additional Entities and the Investors, and that RFC and any Additional Entities may assign any or
all of its rights to any Liquidity Bank. Funding hereby notifies CAC (and CAC hereby acknowledges)
that Funding, pursuant to the Loan and Security Agreement, has assigned

17

 

its rights hereunder to the Deal Agent. All rights of Funding hereunder may be exercised by
the Deal Agent or its assignees, to the extent of their respective rights pursuant to such
assignments.

     Section 8.5 Further Assurances. Funding, CAC and the Servicer agree to do and
perform, from time to time, any and all acts and to execute any and all further instruments
required or reasonably requested by the other parties in order to more fully effect the purposes of
this Agreement, including, without limitation, the execution of any financing statements or
continuation statements or equivalent documents relating to the Loans for filing under the
provisions of the UCC or other laws of any applicable jurisdiction.

     Section 8.6 No Waiver; Cumulative Remedies. No failure to exercise and no delay in
exercising, on the part of Funding, CAC or the Deal Agent, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the
exercise of any other right, remedy, power or privilege. The rights, remedies, powers and
privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and
privilege provided by law.

     Section 8.7 Counterparts. This Agreement may be executed in two or more counterparts
including telecopy transmission thereof (and by different parties on separate counterparts), each
of which shall be an original, but all of which together shall constitute one and the same
instrument.

     Section 8.8 Binding Effect; Third-Party Beneficiaries. This Agreement shall inure to
the benefit of and be binding upon the parties hereto and their respective successors and permitted
assigns. The Deal Agent, the Collateral Agent on behalf of RFC and the Investors, and any
Liquidity Bank are intended by the parties hereto to be third-party beneficiaries of this
Agreement.

     Section 8.9 Merger and Integration. Except as specifically stated otherwise herein,
this Agreement sets forth the entire understanding of the parties relating to the subject matter
hereof, and all prior understandings, written or oral, are superseded by this Agreement. This
Agreement may not be modified, amended, waived or supplemented except as provided herein.

     Section 8.10 Headings. The headings herein are for purposes of reference only and
shall not otherwise affect the meaning or interpretation of any provision hereof.

     Section 8.11 Exhibits. The schedules and exhibits referred to herein shall constitute
a part of this Agreement and are incorporated into this Agreement for all purposes.

     Section 8.12 Covenant Not to File a Bankruptcy Petition. CAC agrees that until one
year and one day after such time as the Loan and Security Agreement has been terminated and all
Obligations thereunder have been paid in full, it shall not (i) institute the filing of a
bankruptcy petition against Funding or the Issuer; (ii) file a petition or consent to a petition
seeking relief on behalf of Funding or the Issuer under the Bankruptcy Law; or (iii) consent to the
appointment of a receiver, liquidator, assignee, trustee, sequestrator (or similar official) of

18

 

Funding or any portion of the property of Funding. This Section 8.12 shall survive
termination of the Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

19

 

     IN WITNESS WHEREOF, Funding and CAC each have caused this Contribution Agreement to be duly
executed by their respective officers as of the day and year first above written.

	 	 	 	 	 	 	 
	FUNDING:	 	CAC WAREHOUSE FUNDING III, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Douglas W. Busk	 	 
	 

	 	Name:
	 	 

Douglas W. Busk
	 	 
	 

	 	Title:
	 	Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	CAC Warehouse Funding Corporation II

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention:   Douglas W. Busk

Telephone:   (248) 353-2700 (ext. 4432)

Telecopy:   (866) 249-3138	 	 
	 
	 	 	 	 	 	 
	CAC:	 	CREDIT ACCEPTANCE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Douglas W. Busk	 	 
	 

	 	Name:
	 	 

Douglas W. Busk
	 	 
	 

	 	Title:
	 	Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	CAC Warehouse Funding Corp.

Silver Triangle Building

25505 West Twelve Mile Road

Southfield, Michigan 48034-8339

Attention:   Douglas W. Busk

Telephone:   (248) 353-2700 (ext. 4432)

Telecopy:   (866) 249-3138	 	 

20

 

EXHIBIT A

to

Contribution Agreement

Dealer Agreements, Purchase Agreements, Loans and Contracts

Exhibit A-1

 

EXHIBIT B

to

Contribution Agreement

Assignment

Exhibit B-1

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00143-of-00352.parquet"}]]