Document:

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                                                                    Exhibit 10.3

                                                                  EXECUTION COPY

                          PLEDGE AND SECURITY AGREEMENT
                          -----------------------------

         This PLEDGE AND SECURITY AGREEMENT is dated as of November 15, 2004 and
made by ABFS Warehouse Trust 2004-2, a Delaware statutory trust (the "Grantor"),
in favor of THE PATRIOT GROUP, LLC, a Delaware limited liability company (the
"Secured Party").

                                    Recitals
                                    --------

         The Secured Party has entered into a Commitment Letter, dated as of
October 27, 2004 (as modified pursuant to the terms of that certain letter
agreement dated November 15, 2004 between the Secured Party and American
Business Financial Services, Inc. ("ABFS"), the "Commitment Letter"), with ABFS.

         It is a condition precedent to providing the Facility contemplated by
the Commitment Letter that the Grantor shall have executed and delivered this
Agreement.

                                    Agreement
                                    ---------

         NOW, THEREFORE, in order to induce the Secured Party to provide the
Facility and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Grantor hereby represents,
warrants, covenants, agrees, assigns and grants as follows:

                  SECTION 1. Definitions. Terms defined in the Commitment Letter
         and not otherwise defined herein have the same respective meanings when
         used herein. Unless the context otherwise requires, terms defined in
         the Uniform Commercial Code of the State of New York (the "Uniform
         Commercial Code") and not otherwise defined in this Agreement or in the
         Commitment Letter shall have the meanings defined for those terms in
         the Uniform Commercial Code. In addition, the following terms shall
         have the meanings respectively set forth after each:

         "Collateral": all present and future right, title and interest of the
Grantor in or to the following personal property:

                  (a) Grantor's 100% ownership interest in the issued and
outstanding capital stock of ABFS 2003-2, Inc.;

                  (b) All rights, remedies, powers and/or privileges of the
Grantor with respect to the foregoing; and

                  (c) Any and all proceeds and products of the foregoing,
including all money, accounts, general intangibles, Deposit Accounts, documents,
instruments, letter-of-credit rights, investment property, chattel paper, goods,
insurance proceeds and any other tangible or intangible property received upon
the sale or disposition of the foregoing;

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         "Commitment Letter Event of Default": as defined in Section 11(a)
hereof.

         "Financing Documents": the Commitment Letter, the Repurchase Agreement
and any related documents.

         "Governmental Authority": any nation or government, any state or other
political subdivision, agency or instrumentality thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government and any court or arbitrator having jurisdiction over
the Grantor or any of its properties.

         "Repurchase Agreement": the Master Repurchase Agreement dated as of
November 15, 2004, by and among the Secured Party, the Grantor, ABFS, American
Business Credit, Inc. and ABFS Consolidated Holdings, Inc.

         "Secured Party": The Patriot Group, LLC and its affiliates, successors
and assigns.

                  SECTION 2. Creation of Security Interest. The Grantor hereby
         assigns and pledges to the Secured Party, and grants to the Secured
         Party, a security interest in and to, all right, title and interest of
         the Grantor in and to all presently existing and hereafter acquired
         Collateral.

                  SECTION 3. Security for Obligations. This Agreement and the
         assignments and pledges made, and security interests granted herein,
         secure the prompt payment, in full in cash, of all obligations owed to
         the Secured Party under the Program Documents (collectively, the
         "Obligations").

                  SECTION 4. Further Assurances. (a) At any time and from time
         to time at the request of the Secured Party, the Grantor shall execute
         and deliver to the Secured Party, at the Grantor's expense, all such
         financing statements and other instruments, certificates and documents
         in form and substance reasonably satisfactory to the Secured Party, and
         perform all such other acts as shall be necessary or reasonably
         desirable to fully perfect or protect or maintain, when filed,
         recorded, delivered or performed, the Secured Party's security
         interests granted pursuant to this Agreement or to enable the Secured
         Party to exercise and enforce its rights and remedies hereunder with
         respect to any Collateral. Without limiting the generality of the
         foregoing, the Grantor: hereby authorizes the filing of such financing
         or continuation statements, or amendments thereto, and such other
         instruments or notices, as may be necessary or reasonably desirable, or
         as the Secured Party may reasonably request, in order to perfect and
         preserve, with the required priority, the security interests granted,
         or purported to be granted hereby.

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                  (b) The Grantor shall furnish to the Secured Party from time
to time statements and schedules further identifying and describing the
Collateral and such other reports in connection with the Collateral as the
Secured Party may reasonably request.

                  (c) Upon the occurrence of an Event of Default or in the event
of a Margin Deficit as defined in the Repurchase Agreement, the Secured Party
may direct any third party obligors to remit funds otherwise payable to either
ABFS 2003-2, Inc. or Grantor to Patriot.

                  SECTION 5. Restrictions on Future Agreements. The Grantor
         agrees that until all the Obligations shall have been satisfied in
         full, the Grantor will not, without the Secured Party's prior written
         consent, take any action, or permit any action to be taken by any other
         Persons to the extent that such Persons are subject to its control, or
         fail to take any action, which would affect the validity, priority,
         perfection or enforcement of the rights granted to the Secured Party
         under this Agreement, and any such agreement or action if it shall take
         place shall be null and void and of no effect whatsoever.

                  SECTION 6. Grantor's Representations and Warranties. The
         Grantor represents and warrants as follows:

                  (a) as of the date of this Agreement, the Grantor has
exclusive possession and control of the Collateral;

                  (b) The Grantor is the legal and beneficial owner of the
Collateral free and clear of all Liens. The Grantor has the power, authority and
legal right to pledge the Collateral purported to be pledged hereby, and to
execute, deliver and perform this Agreement. The pledge of the Collateral
pursuant to this Agreement creates a valid security interest in the Collateral.

                  (c) No authorization, approval or other action by, and no
notice to or filing with, any Governmental Authority (other than such
authorizations, approvals and other actions as have already been taken and are
in full force and effect) are required (i) for the pledge of the Collateral
hereby or for the execution, delivery or performance of this Agreement by the
Grantor, or (ii) for the exercise by the Secured Party of the rights or remedies
in respect of the Collateral hereunder.

                  (d) So long as any Obligations remain outstanding, the Grantor
will not execute any document or instrument covering the Collateral except as
otherwise contemplated or permitted hereby.

                  SECTION 7. Grantor's Covenants. In addition to the other
         covenants and agreements set forth herein and in the other Financing
         Documents, the Grantor covenants and agrees as follows:

                  (a) The Grantor will pay, prior to delinquency, all taxes,
governmental charges, Liens and assessments against the Collateral owned by it,
except those with respect to which the amount or validity is being contested in
good faith by appropriate proceedings and with respect to which reserves in
conformity with GAAP have been provided on the books of the Grantor.

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                  (b) The Collateral will not be used in violation of any law,
regulation or ordinance applicable to the Grantor, nor used in any way that will
void or impair any insurance required to be carried in connection therewith.

                  (c) The Grantor will deal with the Collateral in all such ways
as are considered customary practice by owners of like property.

                  (d) The Grantor will take all reasonable steps to preserve and
protect the Collateral.

                  SECTION 8. Secured Party's Rights Regarding Collateral. The
         Grantor shall keep proper books and records and accounts in which full,
         true and correct entries in conformity with GAAP and all applicable
         laws, rules and regulations shall be made of all material dealings and
         transactions pertaining to the Collateral. The Secured Party shall at
         all reasonable times on reasonable notice have full access to and the
         right to audit any and all of the Grantor's books and records
         pertaining to the Collateral, and to confirm and verify the value of
         the Collateral. The Secured Party shall not be under any duty or
         obligation whatsoever to take any action to preserve any rights of or
         against any prior or other parties in connection with the Collateral,
         to exercise any voting rights or managerial rights with respect to any
         Collateral or to make or give any presentments for payment, demands for
         performance, notices of non-performance, protests, notices of protest,
         notices of dishonor or notices of any other nature whatsoever in
         connection with the Collateral or the Obligations. Subject to the
         Secured Party's obligation to exercise reasonable care with respect to
         any Collateral in its possession, custody or control as set forth in
         Section 8 hereof, the Secured Party shall not be under any duty or
         obligation whatsoever to take any action to protect or preserve the
         Collateral or any rights of the Grantor therein, or to make collections
         or enforce payment thereon, or to participate in any foreclosure or
         other proceeding in connection therewith. Nothing contained herein or
         in any consent by the Secured Party shall constitute an assumption by
         the Secured Party of any obligations of the Grantor under the contracts
         assigned hereunder unless the Secured Party shall have given written
         notice to the counterparty to such assigned contract of the Secured
         Party's intention to assume such contract. The Grantor shall continue
         to be liable for performance of its obligations under such contracts.

                  SECTION 9. Collections on Collateral. The Grantor shall have
         the right to receive dividends and other proceeds from the Collateral
         in the ordinary course of business so long as the Obligations are being
         paid to the Secured Party in accordance with the Program Documents. If
         any of the Obligations are not paid in accordance with the Program
         Documents, at the option of the Secured Party, the Grantor's right to
         receive dividends and other proceeds of the Collateral and to use or
         dispose of such proceeds shall terminate, and any and all dividends and
         proceeds then held or thereafter received on or on account of the
         Collateral will be held or received by the Grantor in trust for the
         Secured Party and immediately delivered in kind to the Secured Party
         (duly endorsed to the Secured Party, if required), to be applied to the
         Obligations or held as Collateral, as the Secured Party shall elect.
         Upon such an occurrence, the Secured Party shall have the right at all
         times to receive, receipt for, endorse, assign, deposit and deliver, in
         the name of the Secured Party or in the name of the Grantor, any and
         all checks, notes, drafts and other instruments for the payment of

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         money constituting proceeds of or otherwise relating to the Collateral;
         and the Grantor hereby authorizes the Secured Party to affix, by
         facsimile signature or otherwise, the general or special endorsement of
         the Grantor, in such manner as the Secured Party shall deem advisable,
         to any such instrument in the event the same has been delivered to or
         obtained by the Secured Party without appropriate endorsement, and the
         Secured Party and any collecting bank are hereby authorized to consider
         such endorsement to be a sufficient, valid and effective endorsement by
         the Grantor, to the same extent as though it were manually executed by
         the duly authorized representative of the Grantor, regardless of by
         whom or under what circumstances or by what authority such endorsement
         actually is affixed, without duty of inquiry or responsibility as to
         such matters, and the Grantor hereby expressly waives demand,
         presentment, protest and notice of protest or dishonor and all other
         notices of every kind and nature with respect to any such instrument.

                  SECTION 10. Possession of Collateral by the Secured Party. All
         the Collateral now, heretofore or hereafter delivered to the Secured
         Party shall be held by the Secured Party in its possession, custody and
         control. Any or all of the Collateral delivered to the Secured Party
         constituting cash or cash equivalents shall, as long as the Obligations
         are being paid in accordance with the Commitment Letter, be held in an
         interest-bearing account with the Secured Party, and shall be, upon
         request of the Grantor, invested in investments authorized by the
         Secured Party. Nothing herein shall obligate the Secured Party to
         obtain any particular return thereon. In any Obligation is not paid in
         accordance with the Program Documents, then the Secured Party may use
         and consume the Collateral, whether for the purpose of preserving
         and/or protecting the Collateral, or for the purpose of performing any
         of the Grantor's Obligations with respect thereto, or otherwise, and
         any or all of the Collateral delivered to the Secured Party
         constituting cash or cash equivalents shall be applied by the Secured
         Party to payment of the Obligations or otherwise held as Collateral as
         the Secured Party shall elect. The Secured Party may at any time
         deliver or redeliver the Collateral or any part thereof to the Grantor,
         and the receipt of any of the same by the Grantor shall be complete and
         full acquittance for the Collateral so delivered, and the Secured Party
         thereafter shall be discharged from any liability or responsibility
         arising after such delivery to the Grantor. So long as the Secured
         Party exercises reasonable care with respect to any Collateral in its
         possession, custody or control, the Secured Party shall not have any
         liability for any loss of or damage to any Collateral, and in no event
         shall the Secured Party have liability for any diminution in value of
         Collateral occasioned by economic or market conditions or events,
         absent the gross negligence or willful misconduct of the Secured Party.
         The Secured Party shall be deemed to have exercised reasonable care
         within the meaning of the preceding sentence if the Collateral in the
         possession, custody or control of the Secured Party is accorded
         treatment substantially equal to that which the Secured Party accords
         similar property for its own account, it being understood that the
         Secured Party shall not have any responsibility for (i) ascertaining or
         taking action with respect to calls, conversions, exchanges,
         maturities, tenders or other matters relating to any Collateral,
         whether or not the Secured Party has or is deemed to have knowledge of
         such matters, or (ii) taking any necessary steps to preserve rights
         against any Person with respect to any Collateral.

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                  SECTION 11. Remedies.

                  (a) Rights Regarding the Collateral. Upon the failure by the
Grantor to pay any Obligation in accordance with the Program Documents (an
"Event of Default"), the Grantor shall be in default hereunder and the Secured
Party shall have, in any jurisdiction where enforcement is sought, in addition
to all other rights and remedies that the Secured Party may have under this
Agreement and under applicable laws or in equity, all rights and remedies of a
secured party under the Uniform Commercial Code as enacted in any such
jurisdiction in effect at that time, and in addition the following rights and
remedies, all of which may be exercised with or without further notice to the
Grantor except such notice as may be specifically required by applicable law:
(i) to foreclose the Liens and security interests created hereunder or under any
other Financing Document by any available judicial procedure or without judicial
process; (ii) to sell, assign, lease or otherwise dispose of any Collateral or
any part thereof, either at public or private sale or at any broker's board, in
lot or in bulk, for cash, on credit or otherwise, with or without
representations or warranties and upon such terms as shall be commercially
reasonable; (iii) to collect by legal proceedings or otherwise all dividends,
distributions, or other sums now or hereafter payable upon or on account of the
Collateral; (vi) to enter into any extension, reorganization, disposition,
merger or consolidation agreement, or any other agreement relating to or
affecting the Collateral, and in connection therewith the Secured Party may
deposit or surrender control of the Collateral and/or accept other property in
exchange for the Collateral as the Secured Party reasonably deems appropriate
and is commercially reasonable; (iv) to take or bring, in the name of the
Secured Party or in the name of the Grantor, any and all steps, actions, suits
or proceedings deemed necessary or reasonably desirable by the Secured Party to
realize upon the Collateral, including any judicial or nonjudicial foreclosure
thereof or thereon, and the Grantor waives, to the extent permitted by
applicable law, any right to receive notice of any public or private judicial or
nonjudicial sale or foreclosure of any security or any of the Collateral, and
any money or other property received by the Secured Party in exchange for or on
account of the Collateral, whether representing collections or proceeds of
Collateral, and whether resulting from voluntary payments or foreclosure
proceedings or other legal action taken by the Secured Party or the Grantor may
be applied by the Secured Party, without notice to the Grantor, to the
Obligations in such order and manner as the Secured Party in its sole discretion
shall determine; (v) to insure, protect and preserve the Collateral; and (vi) to
exercise all rights, remedies, powers or privileges provided under any of the
Financing Documents.

                  (b) Sale of Collateral. Any public or private sale or other
disposition of the Collateral may be held at any office of the Secured Party or
at any other place permitted by applicable law.. The Secured Party may direct
the manner of sale of the Collateral as it in its sole and absolute discretion
may determine provided such sale is commercially reasonable, and the Grantor
expressly waives, to the extent permitted by applicable law, any right to direct
the manner of sale of any Collateral. The Secured Party or any Person acting on
the Secured Party's behalf may bid and purchase at any such sale or other
disposition.

                  (c) Notice of Sale. The Secured Party will give the Grantor
reasonable notice of the time and place of any public sale thereof or of the
time on or after which any private sale thereof is to be made. The requirement
of reasonable notice conclusively shall be met if such notice is mailed,
certified mail, postage prepaid, to the Grantor at its address set forth on the
signature pages hereto or delivered or otherwise sent to the Grantor, at least
ten (10) Business Days before the date of the sale. The Grantor expressly

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waives, to the fullest extent permitted by applicable law, any right to receive
notice of any public or private sale of any Collateral or other security for the
Obligations except as expressly provided for in this paragraph. The Secured
Party shall not be obligated to make any sale of the Collateral if it shall
determine not to do so regardless of the fact that notice of sale of the
Collateral may have been given. The Secured Party may, without notice or
publication, except as required by applicable law, adjourn the sale from time to
time by announcement at the time and place fixed for sale; and such sale may,
without further notice (except as required by applicable law), be made at the
time and place to which the same was so adjourned.

                  (d) Title of Purchasers. Upon consummation of any sale of
Collateral hereunder, the Secured Party shall have the right to assign, transfer
and deliver to the purchaser(s) thereof the Collateral so sold. Such
purchaser(s) shall hold the Collateral so sold absolutely free from any claim or
right upon the part of the Grantor or any other Person claiming through the
Grantor, and the Grantor hereby waives (to the extent permitted by applicable
laws) all rights of redemption, stay and appraisal which it now has or may at
any time in the future have under any rule of law or statute now existing or
hereafter enacted. If the sale of all or any part of the Collateral is made on
credit or for future delivery, the Secured Party shall not be required to apply
any portion of the sale price to the Obligations until such amount actually is
received by the Secured Party, and any Collateral so sold may be retained by the
Secured Party until the sale price is paid in full by the purchaser or
purchasers thereof. The Secured Party shall not incur any liability in case any
such purchaser or purchasers shall fail to pay for the Collateral so sold, and,
in case of any such failure, the Collateral may be sold again.

                  (e) Disposition of Proceeds of Sale. The proceeds resulting
from the sale or other disposition of the Collateral shall be applied, first, to
the reasonable costs and expenses (including reasonable attorneys' fees) of
preparing for sale and selling the Collateral; second, to the satisfaction of
all outstanding Obligations; and, third, any surplus remaining after the
satisfaction of all outstanding Obligations to be paid over to the Grantor or to
whomsoever may be lawfully entitled to receive such surplus.

                  (f) Certain Waivers. To the extent permitted by applicable
law, the Grantor waives all claims, damages and demands against the Secured
Party arising out of the repossession, retention or sale of the Collateral, or
any part or parts thereof, except to the extent any such claims, damages and
awards arise out of the gross negligence or willful misconduct of the Agents or
the Secured Party.

                  (g) Remedies Cumulative. The rights and remedies provided
under this Agreement are cumulative and may be exercised singly or concurrently,
and are not exclusive of any other rights and remedies provided by law or
equity.

                  SECTION 12. Secured Party Appointed Attorney-in-Fact. The
         Grantor hereby irrevocably appoints the Secured Party as the Grantor's
         attorney-in-fact, effective upon and during the continuance of an Event
         of Default, with full authority in the place and stead of the Grantor,
         and in the name of the Grantor, or otherwise, from time to time, in the
         Secured Party's sole and absolute discretion to do any of the following
         acts or things: (a) to do all acts and things and to execute all
         documents necessary or reasonably desirable to perfect and continue

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         perfected the pledge and security interest created by this Agreement
         and to preserve, maintain and protect the Collateral; (b) to do any and
         every act which the Grantor is obligated to do under this Agreement;
         (c) to prepare, sign, file and record, in the Grantor's name, any
         financing statement covering the Collateral; and (d) to endorse and
         transfer the Collateral upon foreclosure by the Secured Party;
         provided, however, that the Secured Party shall be under no obligation
         whatsoever to take any of the foregoing actions, and the Secured Party
         shall not have any liability or responsibility for any act or omission
         (other than the Secured Party's own gross negligence or willful
         misconduct) taken with respect thereto.

                  SECTION 13. Costs and Expenses. The Grantor agrees to pay to
         the Secured Party all reasonable costs and out-of-pocket expenses
         (including reasonable attorneys' fees and disbursements) (a) of the
         Secured Party incurred thereby in the enforcement or attempted
         enforcement of this Agreement, whether or not an action is filed in
         connection therewith, and (b) of the Secured Party incurred thereby in
         connection with any waiver or amendment of any term or provision
         hereof. All reasonable advances, charges, costs and expenses, including
         reasonable attorneys' fees and disbursements, incurred or paid by the
         Secured Party in exercising any right, privilege, power or remedy
         conferred by this Agreement (including the right to perform any
         Obligation of the Grantor), or in the enforcement or attempted
         enforcement thereof, shall be secured hereby and shall become a part of
         the Obligations and shall be due and payable to the Secured Party, as
         applicable, by the Grantor on demand therefor.

                  SECTION 14. Transfers and Other Liens. The Grantor agrees that
         it will not (i) sell, assign, exchange, transfer or otherwise dispose
         of, or contract to sell, assign, exchange, transfer or otherwise
         dispose of, or grant any option with respect to, the Collateral, or
         (ii) create or permit to exist any Lien upon or with respect to the
         Collateral.

                  SECTION 15. Understandings with Respect to Waivers and
         Consents. The Grantor warrants and agrees that each of the waivers and
         consents set forth herein is made with full knowledge of its
         significance and consequences, with the understanding that events
         giving rise to any defense or right waived may diminish, destroy or
         otherwise adversely affect rights which the Grantor otherwise may have
         against the Secured Party or others, or against the Collateral. If any
         of the waivers or consents herein are determined to be unenforceable
         under applicable law, such waivers and consents shall be effective to
         the maximum extent permitted by law.

                  SECTION 16. Indemnity. The Grantor agrees to indemnify the
         Secured Party from and against any and all claims, losses and
         liabilities growing out of or resulting from this Agreement (including
         enforcement of this Agreement), except to the extent such claims,
         losses or liabilities result from the Secured Party's gross negligence
         or willful misconduct.

                  SECTION 17. Amendments, Etc. No amendment or waiver of any
         provision of this Agreement shall be effective unless the same shall be
         in writing, signed by both the Secured Party and the Grantor, and then
         such waiver or consent shall be effective only in the specific instance
         and for the specific purpose for which given.

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                  SECTION 18. Notices. All notices and other communications
         provided for hereunder shall be given in the manner, and to the
         respective addresses, set forth on the signature pages hereto.

                  SECTION 19. Continuing Security Interest; Successors and
         Assigns. This Agreement shall create a continuing security interest in
         the Collateral and shall (a) remain in full force and effect until
         indefeasible payment in full in cash of the Obligations, (b) be binding
         upon the Grantor and its successors and assigns, and (c) inure,
         together with the rights and remedies of the Secured Party hereunder,
         to the benefit of the Secured Party, any successor Secured Party. The
         Secured Party may assign or otherwise transfer any rights in Collateral
         held by it to any other Person, and such other Person shall thereupon
         become vested with all the benefits in respect thereof granted to the
         Secured Party herein or otherwise. The Grantor's successors and assigns
         shall include, without limitation, a receiver, trustee or
         debtor-in-possession thereof or therefor, provided that, none of the
         rights or obligations of the Grantor hereunder may be assigned or
         otherwise transferred without the prior written consent of the Secured
         Party.

                  SECTION 20. Release of Grantor. This Agreement and all
         obligations of the Grantor hereunder and all security interests granted
         hereby shall be released and terminated when all Obligations have been
         indefeasibly paid in full in cash. Upon such release and termination of
         all Obligations and the expiration or termination of the pledge and
         security interest hereunder, all rights in and to the Collateral
         pledged or assigned by the Grantor hereunder shall automatically revert
         to the Grantor, and the Secured Party shall return any pledged
         Collateral in its possession to the Grantor, or to the Person or
         Persons legally entitled thereto, and shall endorse, execute, deliver,
         record and file all instruments and documents, and do all other acts
         and things, reasonably required for the return of the Collateral to the
         Grantor, or to the Person or Persons legally entitled thereto, and to
         evidence or document the release of the interests of the Secured Party
         arising under this Agreement, all as reasonably requested by, and at
         the sole expense of, the Grantor.

                  SECTION 21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
         BY, AND CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE
         STATE OF NEW YORK, EXCEPT FOR THE CONFLICT OF LAWS RULES THEREOF (OTHER
         THAN NEW YORK GENERAL OBLIGATIONS LAW SECTIONS 5-1401 AND 5-1402).

                  SECTION 22. Copies of Certificates Etc. Whenever the Grantor
         is required to deliver notices, certificates, opinions, statements or
         other information hereunder to the Secured Party, it shall do so in
         such number of copies as the Secured Party shall reasonably specify.

                  SECTION 23. Limitation of Liability. It is expressly
         understood and agreed by the parties hereto that (a) this Agreement is
         executed and delivered by Wilmington Trust Company, not individually or
         personally, but solely as owner trustee (the "Owner Trustee"), in the
         exercise of the powers and authority conferred and vested in it, (b)
         each of the representations, undertakings and agreements herein made on
         the part of the Owner Trustee or the Grantor, as the case may be, is

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         made and intended not as personal representations, undertakings and
         agreements by Wilmington Trust Company, but is made and intended for
         the purpose of binding only the Grantor or the Owner Trustee, as the
         case may be, (c) nothing herein contained shall be construed as
         creating any liability on Wilmington Trust Company, individually or
         personally, to perform any covenant either expressed or implied
         contained herein, all such liability, if any, being expressly waived by
         the parties hereto and by any Person claiming by, through or under the
         parties hereto and (d) under no circumstances shall Wilmington Trust
         Company be personally liable for the payment of any indebtedness or
         expenses of the Grantor or the Owner Trustee, as the case may be, or be
         liable for the breach or failure of any obligation, representation,
         warranty or covenant made or undertaken by the Grantor or the Owner
         Trustee, as the case may be, under this Agreement or any other related
         documents.

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         IN WITNESS WHEREOF, the Grantor and the Secured Party have executed
this Agreement by their duly authorized representative as of the date first
written above.

                                     GRANTOR

                                     ABFS Warehouse Trust 2004-2

                                     By:  WILMINGTON TRUST COMPANY not in its
                                          individual capacity but solely as
                                          owner trustee of the Grantor

                                     By:   /s/  Joann A. Rozell
                                          -------------------------------------
                                     Name:      Joann A. Rozell
                                            -----------------------------------
                                     Title:     Assistant Vice President
                                             ----------------------------------

                                     Address for Notices:

                                     ABFS Warehouse Trust 2004-2
                                     c/o Wilmington Trust Company as owner
                                     trustee
                                     Rodney Square North
                                     1100 North Market Street
                                     Wilmington, DE 19890
                                     Attention: Corporate Trust Administration
                                     Telecopier No.: (302) 636-4140
                                     Telephone No: (302) 651-1000

                                     SECURED PARTY
                                     -------------

                                     THE PATRIOT GROUP, LLC

                                     By:   /s/   Jonathan T. Kane
                                          -------------------------------------
                                     Name:       Jonathan T. Kane
                                            -----------------------------------
                                     Title:      Senior Vice President
                                             ----------------------------------

                                     Address for Notices:

                                     28 Thorndal Circle
                                     Darien, Connecticut 06828

                          Pledge and Security Agreement

                                      D-1<PAGE>

                                                                    Exhibit 10.4

                                                                  EXECUTION COPY
                          PLEDGE AND SECURITY AGREEMENT

         This PLEDGE AND SECURITY AGREEMENT is dated as of November 15, 2004 and
made by AMERICAN BUSINESS FINANCIAL SERVICES, INC., a Delaware corporation (the
"Grantor"), in favor of THE PATRIOT GROUP, LLC, a Delaware limited liability
company (the "Secured Party").

                                    Recitals

         The Secured Party has entered into a Commitment Letter, dated as of
October 27, 2004 (as modified pursuant to the terms of that certain letter
agreement dated November 15, 2004 between the Secured Party and the Grantor, the
"Commitment Letter"), with the Grantor.

         It is a condition precedent to providing the Facility contemplated by
the Commitment Letter that the Grantor shall have executed and delivered this
Agreement.

                                    Agreement

         NOW, THEREFORE, in order to induce the Secured Party to provide the
Facility and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Grantor hereby represents,
warrants, covenants, agrees, assigns and grants as follows:

         SECTION 1. Definitions. Terms defined in the Commitment Letter and not
otherwise defined herein have the same respective meanings when used herein.
Unless the context otherwise requires, terms defined in the Uniform Commercial
Code of the State of New York (the "Uniform Commercial Code") and not otherwise
defined in this Agreement or in the Commitment Letter shall have the meanings
defined for those terms in the Uniform Commercial Code. In addition, the
following terms shall have the meanings respectively set forth after each:

         "Collateral": all present and future right, title and interest of the
Grantor in or to the following personal property:

         (a) Grantor's 100% ownership interest in the issued and outstanding
capital stock of Holdings;

         (b) All rights, remedies, powers and/or privileges of the Grantor with
respect to the foregoing; and

         (c) Any and all proceeds and products of the foregoing, including all
money, accounts, general intangibles, Deposit Accounts, documents, instruments,
letter-of-credit rights, investment property, chattel paper, goods, insurance
proceeds and any other tangible or intangible property received upon the sale or
disposition of the foregoing;

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<PAGE>

         "Commitment Letter Event of Default": as defined in Section 11(a)
hereof.

         "Financing Documents": the Commitment Letter, the Repurchase Agreement
and any related documents.

         "Governmental Authority": any nation or government, any state or other
political subdivision, agency or instrumentality thereof, any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government and any court or arbitrator having jurisdiction over
the Grantor or any of its properties.

         "Holdings": ABFS Consolidated Holdings, Inc., a Delaware corporation.

         "Repurchase Agreement": the Master Repurchase Agreement dated as of
November [5], 2004, by and among the Secured Party, ABFS Warehouse Trust 2004-2,
the Grantor and Holdings.

         "Secured Party": The Patriot Group, LLC and its affiliates, successors
and assigns.

         SECTION 2. Creation of Security Interest. The Grantor hereby assigns
and pledges to the Secured Party, and grants to the Secured Party, a security
interest in and to, all right, title and interest of the Grantor in and to all
presently existing and hereafter acquired Collateral.

         SECTION 3. Security for Obligations. This Agreement and the assignments
and pledges made, and security interests granted herein, secure the prompt
payment, in full in cash, of all obligations owed to the Secured Party under the
Program Documents (collectively, the "Obligations").

         SECTION 4. Further Assurances. (a) At any time and from time to time at
the request of the Secured Party, the Grantor shall execute and deliver to the
Secured Party, at the Grantor's expense, all such financing statements and other
instruments, certificates and documents in form and substance reasonably
satisfactory to the Secured Party, and perform all such other acts as shall be
necessary or reasonably desirable to fully perfect or protect or maintain, when
filed, recorded, delivered or performed, the Secured Party's security interests
granted pursuant to this Agreement or to enable the Secured Party to exercise
and enforce its rights and remedies hereunder with respect to any Collateral.
Without limiting the generality of the foregoing, the Grantor hereby authorizes
the filing of such financing or continuation statements, or amendments thereto,
and such other instruments or notices, as may be necessary or reasonably
desirable, or as the Secured Party may reasonably request, in order to perfect
and preserve, with the required priority, the security interests granted, or
purported to be granted hereby.

         (b) The Grantor shall furnish to the Secured Party from time to time
statements and schedules further identifying and describing the Collateral and
such other reports in connection with the Collateral as the Secured Party may
reasonably request.

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<PAGE>

         SECTION 5. Restrictions on Future Agreements. The Grantor agrees that
until all the Obligations shall have been satisfied in full, the Grantor will
not, without the Secured Party's prior written consent, take any action, or
permit any action to be taken by any other Persons to the extent that such
Persons are subject to its control, or fail to take any action, which would
affect the validity, priority, perfection or enforcement of the rights granted
to the Secured Party under this Agreement, and any such agreement or action if
it shall take place shall be null and void and of no effect whatsoever.

         SECTION 6. Grantor's Representations and Warranties. The Grantor
represents and warrants as follows:

         (a) as of the date of this Agreement, the Grantor has exclusive
possession and control of the Collateral;

         (b) The Grantor is the legal and beneficial owner of the Collateral
free and clear of all Liens. The Grantor has the power, authority and legal
right to pledge the Collateral purported to be pledged hereby, and to execute,
deliver and perform this Agreement. The pledge of the Collateral pursuant to
this Agreement creates a valid security interest in the Collateral.

         (c) No authorization, approval or other action by, and no notice to or
filing with, any Governmental Authority (other than such authorizations,
approvals and other actions as have already been taken and are in full force and
effect) are required (i) for the pledge of the Collateral hereby or for the
execution, delivery or performance of this Agreement by the Grantor, or (ii) for
the exercise by the Secured Party of the rights or remedies in respect of the
Collateral hereunder.

         (d) So long as any Obligations remain outstanding, the Grantor will not
execute any document or instrument covering the Collateral except as otherwise
contemplated or permitted hereby.

         SECTION 7. Grantor's Covenants. In addition to the other covenants and
agreements set forth herein and in the other Financing Documents, the Grantor
covenants and agrees as follows:

         (a) The Grantor will pay, prior to delinquency, all taxes, governmental
charges, Liens and assessments against the Collateral owned by it, except those
with respect to which the amount or validity is being contested in good faith by
appropriate proceedings and with respect to which reserves in conformity with
GAAP have been provided on the books of the Grantor.

         (b) The Collateral will not be used in violation of any law, regulation
or ordinance applicable to the Grantor, nor used in any way that will void or
impair any insurance required to be carried in connection therewith.

         (c) The Grantor will deal with the Collateral in all such ways as are
considered customary practice by owners of like property.

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<PAGE>

         (d) The Grantor will take all reasonable steps to preserve and protect
the Collateral.

         SECTION 8. Secured Party's Rights Regarding Collateral. The Grantor
shall keep proper books and records and accounts in which full, true and correct
entries in conformity with GAAP and all applicable laws, rules and regulations
shall be made of all material dealings and transactions pertaining to the
Collateral. The Secured Party shall at all reasonable times on reasonable notice
have full access to and the right to audit any and all of the Grantor's books
and records pertaining to the Collateral, and to confirm and verify the value of
the Collateral. The Secured Party shall not be under any duty or obligation
whatsoever to take any action to preserve any rights of or against any prior or
other parties in connection with the Collateral, to exercise any voting rights
or managerial rights with respect to any Collateral or to make or give any
presentments for payment, demands for performance, notices of non-performance,
protests, notices of protest, notices of dishonor or notices of any other nature
whatsoever in connection with the Collateral or the Obligations. Subject to the
Secured Party's obligation to exercise reasonable care with respect to any
Collateral in its possession, custody or control as set forth in Section 8
hereof, the Secured Party shall not be under any duty or obligation whatsoever
to take any action to protect or preserve the Collateral or any rights of the
Grantor therein, or to make collections or enforce payment thereon, or to
participate in any foreclosure or other proceeding in connection therewith.
Nothing contained herein or in any consent by the Secured Party shall constitute
an assumption by the Secured Party of any obligations of the Grantor under the
contracts assigned hereunder unless the Secured Party shall have given written
notice to the counterparty to such assigned contract of the Secured Party's
intention to assume such contract. The Grantor shall continue to be liable for
performance of its obligations under such contracts.

         SECTION 9. Collections on Collateral. The Grantor shall have the right
to receive dividends and other proceeds from the Collateral in the ordinary
course of business so long as the Obligations are being paid to the Secured
Party in accordance with the Program Documents. If any of the Obligations are
not paid in accordance with the Program Documents, at the option of the Secured
Party, the Grantor's right to receive dividends and other proceeds of the
Collateral and to use or dispose of such proceeds shall terminate, and any and
all dividends and proceeds then held or thereafter received on or on account of
the Collateral will be held or received by the Grantor in trust for the Secured
Party and immediately delivered in kind to the Secured Party (duly endorsed to
the Secured Party, if required), to be applied to the Obligations or held as
Collateral, as the Secured Party shall elect. Upon such an occurrence, the
Secured Party shall have the right at all times to receive, receipt for,
endorse, assign, deposit and deliver, in the name of the Secured Party or in the
name of the Grantor, any and all checks, notes, drafts and other instruments for
the payment of money constituting proceeds of or otherwise relating to the
Collateral; and the Grantor hereby authorizes the Secured Party to affix, by
facsimile signature or otherwise, the general or special endorsement of the
Grantor, in such manner as the Secured Party shall deem advisable, to any such
instrument in the event the same has been delivered to or obtained by the
Secured Party without appropriate endorsement, and the Secured Party and any
collecting bank are hereby authorized to consider such endorsement to be a
sufficient, valid and effective endorsement by the Grantor, to the same extent
as though it were manually executed by the duly authorized representative of the
Grantor, regardless of by whom or under what circumstances or by what authority
such endorsement actually is affixed, without duty of inquiry or responsibility
as to such matters, and the Grantor hereby expressly waives demand, presentment,
protest and notice of protest or dishonor and all other notices of every kind
and nature with respect to any such instrument.

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<PAGE>

         SECTION 10. Possession of Collateral by the Secured Party. All the
Collateral now, heretofore or hereafter delivered to the Secured Party shall be
held by the Secured Party in its possession, custody and control. Any or all of
the Collateral delivered to the Secured Party constituting cash or cash
equivalents shall, as long as the Obligations are being paid in accordance with
the Commitment Letter, be held in an interest-bearing account with the Secured
Party, and shall be, upon request of the Grantor, invested in investments
authorized by the Secured Party. Nothing herein shall obligate the Secured Party
to obtain any particular return thereon. In any Obligation is not paid in
accordance with the Program Documents, then the Secured Party may use and
consume the Collateral, whether for the purpose of preserving and/or protecting
the Collateral, or for the purpose of performing any of the Grantor's
Obligations with respect thereto, or otherwise, and any or all of the Collateral
delivered to the Secured Party constituting cash or cash equivalents shall be
applied by the Secured Party to payment of the Obligations or otherwise held as
Collateral as the Secured Party shall elect. The Secured Party may at any time
deliver or redeliver the Collateral or any part thereof to the Grantor, and the
receipt of any of the same by the Grantor shall be complete and full acquittance
for the Collateral so delivered, and the Secured Party thereafter shall be
discharged from any liability or responsibility arising after such delivery to
the Grantor. So long as the Secured Party exercises reasonable care with respect
to any Collateral in its possession, custody or control, the Secured Party shall
not have any liability for any loss of or damage to any Collateral, and in no
event shall the Secured Party have liability for any diminution in value of
Collateral occasioned by economic or market conditions or events, absent the
gross negligence or willful misconduct of the Secured Party. The Secured Party
shall be deemed to have exercised reasonable care within the meaning of the
preceding sentence if the Collateral in the possession, custody or control of
the Secured Party is accorded treatment substantially equal to that which the
Secured Party accords similar property for its own account, it being understood
that the Secured Party shall not have any responsibility for (i) ascertaining or
taking action with respect to calls, conversions, exchanges, maturities, tenders
or other matters relating to any Collateral, whether or not the Secured Party
has or is deemed to have knowledge of such matters, or (ii) taking any necessary
steps to preserve rights against any Person with respect to any Collateral.

         SECTION 11. Remedies.

         (a) Rights Regarding the Collateral. Upon the failure by the Grantor to
pay any Obligation in accordance with the Program Documents (an "Event of
Default"), the Grantor shall be in default hereunder and the Secured Party shall
have, in any jurisdiction where enforcement is sought, in addition to all other
rights and remedies that the Secured Party may have under this Agreement and
under applicable laws or in equity, all rights and remedies of a secured party
under the Uniform Commercial Code as enacted in any such jurisdiction in effect
at that time, and in addition the following rights and remedies, all of which
may be exercised with or without further notice to the Grantor except such
notice as may be specifically required by applicable law: (i) to foreclose the
Liens and security interests created hereunder or under any other Financing
Document by any available judicial procedure or without judicial process; (ii)
to sell, assign, lease or otherwise dispose of any Collateral or any part
thereof, either at public or private sale or at any broker's board, in lot or in
bulk, for cash, on credit or otherwise, with or without representations or
warranties and upon such terms as shall be commercially reasonable; (iii) to
collect by legal proceedings or otherwise all dividends, distributions, or other
sums now or hereafter payable upon or on account of the Collateral; (vi) to
enter into any extension, reorganization, disposition, merger or consolidation
agreement, or any other agreement relating to or affecting the Collateral, and
in connection therewith the Secured Party may deposit or surrender control of
the Collateral and/or accept other property in exchange for the Collateral as
the Secured Party reasonably deems appropriate and is commercially reasonable;
(iv) to take or bring, in the name of the Secured Party or in the name of the
Grantor, any and all steps, actions, suits or proceedings deemed necessary or
reasonably desirable by the Secured Party to realize upon the Collateral,
including any judicial or nonjudicial foreclosure thereof or thereon, and the
Grantor waives, to the extent permitted by applicable law, any right to receive
notice of any public or private judicial or nonjudicial sale or foreclosure of
any security or any of the Collateral, and any money or other property received
by the Secured Party in exchange for or on account of the Collateral, whether
representing collections or proceeds of Collateral, and whether resulting from
voluntary payments or foreclosure proceedings or other legal action taken by the
Secured Party or the Grantor may be applied by the Secured Party, without notice
to the Grantor, to the Obligations in such order and manner as the Secured Party
in its sole discretion shall determine; (v) to insure, protect and preserve the
Collateral; and (vi) to exercise all rights, remedies, powers or privileges
provided under any of the Financing Documents.

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<PAGE>

         (b) Sale of Collateral. Any public or private sale or other disposition
of the Collateral may be held at any office of the Secured Party or at any other
place permitted by applicable law.. The Secured Party may direct the manner of
sale of the Collateral as it in its sole and absolute discretion may determine
provided such sale is commercially reasonable, and the Grantor expressly waives,
to the extent permitted by applicable law, any right to direct the manner of
sale of any Collateral. The Secured Party or any Person acting on the Secured
Party's behalf may bid and purchase at any such sale or other disposition.

         (c) Notice of Sale. The Secured Party will give the Grantor reasonable
notice of the time and place of any public sale thereof or of the time on or
after which any private sale thereof is to be made. The requirement of
reasonable notice conclusively shall be met if such notice is mailed, certified
mail, postage prepaid, to the Grantor at its address set forth on the signature
pages hereto or delivered or otherwise sent to the Grantor, at least ten (10)
Business Days before the date of the sale. The Grantor expressly waives, to the
fullest extent permitted by applicable law, any right to receive notice of any
public or private sale of any Collateral or other security for the Obligations
except as expressly provided for in this paragraph. The Secured Party shall not
be obligated to make any sale of the Collateral if it shall determine not to do
so regardless of the fact that notice of sale of the Collateral may have been
given. The Secured Party may, without notice or publication, except as required
by applicable law, adjourn the sale from time to time by announcement at the
time and place fixed for sale; and such sale may, without further notice (except
as required by applicable law), be made at the time and place to which the same
was so adjourned.

         (d) Title of Purchasers. Upon consummation of any sale of Collateral
hereunder, the Secured Party shall have the right to assign, transfer and
deliver to the purchaser(s) thereof the Collateral so sold. Such purchaser(s)
shall hold the Collateral so sold absolutely free from any claim or right upon
the part of the Grantor or any other Person claiming through the Grantor, and
the Grantor hereby waives (to the extent permitted by applicable laws) all
rights of redemption, stay and appraisal which it now has or may at any time in
the future have under any rule of law or statute now existing or hereafter
enacted. If the sale of all or any part of the Collateral is made on credit or
for future delivery, the Secured Party shall not be required to apply any
portion of the sale price to the Obligations until such amount actually is
received by the Secured Party, and any Collateral so sold may be retained by the
Secured Party until the sale price is paid in full by the purchaser or
purchasers thereof. The Secured Party shall not incur any liability in case any
such purchaser or purchasers shall fail to pay for the Collateral so sold, and,
in case of any such failure, the Collateral may be sold again.

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         (e) Disposition of Proceeds of Sale. The proceeds resulting from the
sale or other disposition of the Collateral shall be applied, first, to the
reasonable costs and expenses (including reasonable attorneys' fees) of
preparing for sale and selling the Collateral; second, to the satisfaction of
all outstanding Obligations; and, third, any surplus remaining after the
satisfaction of all outstanding Obligations to be paid over to the Grantor or to
whomsoever may be lawfully entitled to receive such surplus.

         (f) Certain Waivers. To the extent permitted by applicable law, the
Grantor waives all claims, damages and demands against the Secured Party arising
out of the repossession, retention or sale of the Collateral, or any part or
parts thereof, except to the extent any such claims, damages and awards arise
out of the gross negligence or willful misconduct of the Agents or the Secured
Party.

         (g) Remedies Cumulative. The rights and remedies provided under this
Agreement are cumulative and may be exercised singly or concurrently, and are
not exclusive of any other rights and remedies provided by law or equity.

         SECTION 12. Secured Party Appointed Attorney-in-Fact. The Grantor
hereby irrevocably appoints the Secured Party as the Grantor's attorney-in-fact,
effective upon and during the continuance of an Event of Default, with full
authority in the place and stead of the Grantor, and in the name of the Grantor,
or otherwise, from time to time, in the Secured Party's sole and absolute
discretion to do any of the following acts or things: (a) to do all acts and
things and to execute all documents necessary or reasonably desirable to perfect
and continue perfected the pledge and security interest created by this
Agreement and to preserve, maintain and protect the Collateral; (b) to do any
and every act which the Grantor is obligated to do under this Agreement; (c) to
prepare, sign, file and record, in the Grantor's name, any financing statement
covering the Collateral; and (d) to endorse and transfer the Collateral upon
foreclosure by the Secured Party; provided, however, that the Secured Party
shall be under no obligation whatsoever to take any of the foregoing actions,
and the Secured Party shall not have any liability or responsibility for any act
or omission (other than the Secured Party's own gross negligence or willful
misconduct) taken with respect thereto.

         SECTION 13. Costs and Expenses. The Grantor agrees to pay to the
Secured Party all reasonable costs and out-of-pocket expenses (including
reasonable attorneys' fees and disbursements) (a) of the Secured Party incurred
thereby in the enforcement or attempted enforcement of this Agreement, whether
or not an action is filed in connection therewith, and (b) of the Secured Party
incurred thereby in connection with any waiver or amendment of any term or
provision hereof. All reasonable advances, charges, costs and expenses,
including reasonable attorneys' fees and disbursements, incurred or paid by the
Secured Party in exercising any right, privilege, power or remedy conferred by
this Agreement (including the right to perform any Obligation of the Grantor),
or in the enforcement or attempted enforcement thereof, shall be secured hereby
and shall become a part of the Obligations and shall be due and payable to the
Secured Party, as applicable, by the Grantor on demand therefor.

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<PAGE>

         SECTION 14. Transfers and Other Liens. The Grantor agrees that it will
not (i) sell, assign, exchange, transfer or otherwise dispose of, or contract to
sell, assign, exchange, transfer or otherwise dispose of, or grant any option
with respect to, the Collateral, or (ii) create or permit to exist any Lien upon
or with respect to the Collateral.

         SECTION 15. Understandings with Respect to Waivers and Consents. The
Grantor warrants and agrees that each of the waivers and consents set forth
herein is made with full knowledge of its significance and consequences, with
the understanding that events giving rise to any defense or right waived may
diminish, destroy or otherwise adversely affect rights which the Grantor
otherwise may have against the Secured Party or others, or against the
Collateral. If any of the waivers or consents herein are determined to be
unenforceable under applicable law, such waivers and consents shall be effective
to the maximum extent permitted by law.

         SECTION 16. Indemnity. The Grantor agrees to indemnify the Secured
Party from and against any and all claims, losses and liabilities growing out of
or resulting from this Agreement (including enforcement of this Agreement),
except to the extent such claims, losses or liabilities result from the Secured
Party's gross negligence or willful misconduct.

         SECTION 17. Amendments, Etc. No amendment or waiver of any provision of
this Agreement shall be effective unless the same shall be in writing, signed by
both the Secured Party and the Grantor, and then such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which
given.

         SECTION 18. Notices. All notices and other communications provided for
hereunder shall be given in the manner, and to the respective addresses, set
forth on the signature pages hereto.

         SECTION 19. Continuing Security Interest; Successors and Assigns. This
Agreement shall create a continuing security interest in the Collateral and
shall (a) remain in full force and effect until indefeasible payment in full in
cash of the Obligations, (b) be binding upon the Grantor and its successors and
assigns, and (c) inure, together with the rights and remedies of the Secured
Party hereunder, to the benefit of the Secured Party, any successor Secured
Party. The Secured Party may assign or otherwise transfer any rights in
Collateral held by it to any other Person, and such other Person shall thereupon
become vested with all the benefits in respect thereof granted to the Secured
Party herein or otherwise. The Grantor's successors and assigns shall include,
without limitation, a receiver, trustee or debtor-in-possession thereof or
therefor, provided that, none of the rights or obligations of the Grantor
hereunder may be assigned or otherwise transferred without the prior written
consent of the Secured Party.

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<PAGE>

         SECTION 20. Release of Grantor. This Agreement and all obligations of
the Grantor hereunder and all security interests granted hereby shall be
released and terminated when all Obligations have been indefeasibly paid in full
in cash. Upon such release and termination of all Obligations and the expiration
or termination of the pledge and security interest hereunder, all rights in and
to the Collateral pledged or assigned by the Grantor hereunder shall
automatically revert to the Grantor, and the Secured Party shall return any
pledged Collateral in its possession to the Grantor, or to the Person or Persons
legally entitled thereto, and shall endorse, execute, deliver, record and file
all instruments and documents, and do all other acts and things, reasonably
required for the return of the Collateral to the Grantor, or to the Person or
Persons legally entitled thereto, and to evidence or document the release of the
interests of the Secured Party arising under this Agreement, all as reasonably
requested by, and at the sole expense of, the Grantor.

         SECTION 21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW YORK,
EXCEPT FOR THE CONFLICT OF LAWS RULES THEREOF (OTHER THAN NEW YORK GENERAL
OBLIGATIONS LAW SECTIONS 5-1401 AND 5-1402).

         SECTION 22. Copies of Certificates Etc. Whenever the Grantor is
required to deliver notices, certificates, opinions, statements or other
information hereunder to the Secured Party, it shall do so in such number of
copies as the Secured Party shall reasonably specify.

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<PAGE>
         IN WITNESS WHEREOF, the Grantor and the Secured Party have executed
this Agreement by their duly authorized representative as of the date first
written above.

                                       GRANTOR

                                       AMERICAN BUSINESS FINANCIAL
                                       SERVICES, INC.

                                       By:   /s/ Stephen M. Giroux
                                            ------------------------------------
                                       Name:     Stephen M. Giroux
                                              ----------------------------------
                                       Title:    Executive Vice President,
                                                 General Counsel and Secretary
                                               ---------------------------------

                                       Address for Notices:

                                       American Business Financial Services, Inc
                                       The Wanamaker Building
                                       100 Penn Square East, 8th Floor
                                       Philadelphia, PA 19109

                                       SECURED PARTY

                                       THE PATRIOT GROUP, LLC

                                       By:   /s/   Jonathan T. Kane
                                            ------------------------------------
                                       Name:       Jonathan T. Kane
                                              ----------------------------------
                                       Title:      Senior Vice President
                                               ---------------------------------

                                       Address for Notices:

                                       28 Thorndal Circle
                                       Darien, Connecticut  06828

                                      D-1

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