Document:

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                                                                    EXHIBIT 10.2

                           BACKUP SERVICING AGREEMENT

                                     BETWEEN

                           ONYX ACCEPTANCE CORPORATION

                      ONYX ACCEPTANCE FINANCIAL CORPORATION

                               JPMORGAN CHASE BANK

                            XL CAPITAL ASSURANCE INC.

                       ONYX ACCEPTANCE OWNER TRUST 2004-C

                                       AND

                      SYSTEMS & SERVICES TECHNOLOGIES, INC.
                               AS BACKUP SERVICER

                           ---------------------------

                           DATED AS OF AUGUST 26, 2004

                           ---------------------------
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         THIS BACKUP SERVICING AGREEMENT, dated as of August 26, 2004 (this
"Agreement"), is between ONYX ACCEPTANCE CORPORATION ("Onyx" or, in its capacity
as servicer, the "Servicer"), a Delaware corporation, ONYX ACCEPTANCE FINANCIAL
CORPORATION ("Finco"), a Delaware corporation, JPMORGAN CHASE BANK (the
"Indenture Trustee"), a New York banking corporation, XL CAPITAL ASSURANCE INC.
("XLCA"), a New York stock insurance corporation, ONYX ACCEPTANCE OWNER TRUST
2004-C (the "Issuer"), a Delaware statutory trust, and SYSTEMS & SERVICES
TECHNOLOGIES, INC., a Delaware corporation, as Backup Servicer (the "Backup
Servicer" or "SST").

                                   WITNESSETH:

         WHEREAS, the Servicer, the Indenture Trustee, Finco and the Issuer are
party to that certain Sale and Servicing Agreement dated as of August 1, 2004
(the "Sale and Servicing Agreement");

         WHEREAS, the terms of the Sale and Servicing Agreement require that the
parties thereto enter into an agreement with a backup servicer to (i) perform
certain backup servicing duties more definitively described on Schedule I hereto
and (ii) become Successor Servicer upon the occurrence of certain specified
events;

         WHEREAS, SST is willing to perform the backup servicing duties and act
as Successor Servicer as specified herein pursuant to the conditions and for the
consideration described herein;

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

                                    ARTICLE I

                                   DEFINITIONS

         SECTION 1.1 Definitions. Unless otherwise specified herein, all
capitalized terms shall have the meaning assigned to such terms in the Sale and
Servicing Agreement. Whenever capitalized and used in this Agreement, the
following words and phrases, unless the context otherwise requires, shall have
the following meanings:

         Agreement: This Backup Servicing Agreement, together with all
amendments and supplements hereto and all exhibits and schedules to any of the
foregoing.

         Authorized Officer: With respect to the Backup Servicer, the President,
any Vice President, Assistant Vice President, Secretary or Assistant Secretary
of the Backup Servicer and also, with respect to a particular matter, any other
officer of the Backup Servicer to whom such matter is referred because of such
officer's knowledge and familiarity with the particular subject.

         Backup Servicer or SST: Systems & Services Technologies, Inc., a
Delaware corporation, in its capacities as backup servicer and, upon the
expiration of the Transfer Period, as Successor Servicer, together with its
successors in interest and permitted assigns.

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         Backup Servicer Expenses: The meaning ascribed to such term in Section
2.4(a)(i) of this Agreement.

         Backup Servicer Fees: The meaning ascribed to such term in Section
2.4(a)(i) of this Agreement.

         Business Day: Any day other than a Saturday, a Sunday or other day on
which commercial banking institutions or savings associations located in St.
Joseph, Missouri, Los Angeles, California, Wilmington, Delaware or New York, New
York are authorized or obligated by law, regulation, executive order or
governmental decree to be closed.

         Contract: Each retail installment sales contract and security agreement
or installment loan agreement and security agreement and all proceeds thereof
and payments thereunder, which contract or agreement has been executed by an
obligor and pursuant to which such obligor purchased or financed the vehicle
described therein, agreed to pay the deferred purchase price (i.e., the purchase
price net of any down payment) or amount borrowed, together with interest, as
therein provided in connection with such purchase or loan, granted a security
interest in such vehicle, and undertook to perform certain other obligations as
specified in such contract or agreement and which is being serviced by the
Servicer in connection with the Sale and Servicing Agreement.

         Controlling Party: (i) XLCA, so long as no Insurer Default shall have
occurred and be continuing and (ii) the Indenture Trustee, so long as an Insurer
Default shall have occurred and be continuing; provided that the Indenture
Trustee shall notify the Backup Servicer promptly after the occurrence of any
Insurer Default that the Indenture Trustee has become the Controlling Party.

         Distribution Date: The 15th day of each month or if such date shall not
be a Business Day, the following Business Day commencing September 15, 2004.

         Finco: Onyx Acceptance Financial Corporation, a Delaware corporation.

         Indenture: That certain Indenture dated as of August 1, 2004, between
the Issuer and the Indenture Trustee, as the same may be amended, modified or
restated from time to time.

         Indenture Trustee: JPMorgan Chase Bank, a New York banking corporation,
not in its individual capacity but solely as Indenture Trustee under the
Indenture, its successors in interest and any successor Indenture Trustee under
the Indenture.

         Information Package: The meaning ascribed to such term in Section
2.1(a) of this Agreement.

         Issuer: Onyx Acceptance Owner Trust 2004-C, a Delaware statutory trust.

         Notes: The Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes
and the Class A-4 Notes issued pursuant to the Indenture.

         Onyx: Onyx Acceptance Corporation, a Delaware corporation.

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         Person: Any legal person, including any individual, corporation,
partnership, joint venture, estate, association, joint stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof, or any other entity.

         Rating Agencies: Moody's Investors Service, Inc. and its successors in
interest and Standard & Poor's Ratings Services, a division of The McGraw-Hill
Companies, Inc., and its successors in interest.

         Sale and Servicing Agreement: That certain Sale and Servicing Agreement
dated as of August 1, 2004, between the Issuer, the Servicer, Finco and JPMorgan
Chase Bank, as Indenture Trustee and Trust Agent, as the same may be amended,
modified or restated from time to time.

         Servicer: Onyx Acceptance Corporation in its capacity as servicer under
the Sale and Servicing Agreement, its successors in interest and any Successor
Servicer, other than the Backup Servicer, under the Sale and Servicing
Agreement.

         SST: See the definition of "Backup Servicer" in this Section 1.1.

         Successor Servicer: The Person appointed to succeed a resigning or
terminated servicer pursuant to Section 7.02 of the Sale and Servicing Agreement
and, in the case of SST, in accordance with the terms hereunder.

         Termination Event: An event described in Section 4.1.

         Transfer Notice: Written notice from the Indenture Trustee to the
Backup Servicer advising the Backup Servicer of the transfer of active servicing
duties to the Backup Servicer as Successor Servicer under the Sale and Servicing
Agreement.

         Transfer Period: The period following the Backup Servicer's receipt of
a Transfer Notice, which period shall end on the earlier of thirty (30) days
after receipt by the Backup Servicer of the Transfer Notice and the date upon
which the Backup Servicer begins acting as Successor Servicer under the Sale and
Servicing Agreement.

         Verification and Confirmation Duties: The duties defined as such in
Section 2.1(a).

         XLCA: XL Capital Assurance, Inc., a New York stock insurance
corporation.

         SECTION 1.2 Usage of Terms. With respect to all terms used 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 terms "include"
or "including" mean "include without limitation" or "including without
limitation."

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         SECTION 1.3 Section References. All references to Articles, Sections,
paragraphs, subsections, exhibits and schedules shall be to such portions of
this Agreement unless otherwise specified.

                                   ARTICLE II

                   ADMINISTRATION AND SERVICING OF RECEIVABLES

         SECTION 2.1 Duties of the Backup Servicer.

         (a)      Verification and Confirmation Duties. Prior to its appointment
as Successor Servicer, the Backup Servicer shall perform all of the duties of
the Backup Servicer as identified on Schedule I hereto (collectively, the
"Verification and Confirmation Duties") in accordance with the terms of this
Agreement. No later than the Servicer Report Date, the Servicer shall deliver to
the Backup Servicer the Distribution Date Statement and a computer tape in a
format acceptable to the Backup Servicer containing the information with respect
to the Contracts for the preceding Collection Period necessary for the
preparation of the Distribution Date Statement and the performance of the
Verification and Confirmation Duties relating to such Collection Period
(collectively, the "Information Package").

         (b)      Active Servicing Duties. In the event that the Servicer is
terminated, resigns or otherwise ceases to function as Servicer under the Sale
and Servicing Agreement, the Indenture Trustee shall (unless otherwise directed
by XLCA, if then the Controlling Party) deliver a Transfer Notice to the Backup
Servicer appointing the Backup Servicer as Successor Servicer. Upon the
expiration of the Transfer Period, the Backup Servicer shall assume the duties,
liabilities and obligations of the Servicer under the Sale and Servicing
Agreement, as modified in accordance with Schedule III, and under Section
2.04(b)(ii)(A) and Sections 4.01(b) and (e) of the Insurance Agreement.

         (c)      Term. The provisions of this Agreement and the duties and
obligations of the Backup Servicer hereunder shall commence on the date hereof
and shall continue in full force and effect until either (i) if SST is not then
the Successor Servicer, the Notes have been repaid in their entirety or (ii) the
Pool Balance equals zero, unless earlier terminated pursuant to the terms of
this Agreement. Upon the termination of the Policy, all rights, liabilities,
duties and obligations of XL hereunder shall terminate other than any such
liability that accrued to or was incurred by XL prior to such repayment.

         (d)      Scope of Duties. The Backup Servicer undertakes to perform
only such duties and obligations as are specifically set forth in this
Agreement, it being expressly understood by all parties hereto that there are no
implied duties or obligations of the Backup Servicer hereunder. Without limiting
the generality of the foregoing, the Backup Servicer, except as expressly set
forth herein, shall have no obligation to supervise, verify, monitor or
administer the performance of the Servicer. The Backup Servicer may act through
its agents, attorneys and custodians in performing any of its duties hereunder,
it being understood by the parties hereto that the Backup Servicer will be
responsible for any willful misconduct or negligence on the part of such agents,
attorneys or custodians acting for and on behalf of the Backup Servicer.
Notwithstanding anything to the contrary in the Basic Documents, the Backup
Servicer shall have no liability for any actions taken or omitted by the
Servicer or its agents or the inaccuracy of any data provided, produced or
supplied by the Servicer or its agents, except to the extent provided in Section
3.1(d) of this Agreement.

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Notwithstanding anything herein or in the Basic Documents to the contrary, SST
will not be obligated to undertake the duties of the Administrator under the
Administration Agreement.

         SECTION 2.2 Representations, and Warranties of Backup Servicer. By its
execution and delivery of this Agreement, the Backup Servicer makes the
following representations and warranties as of the date of this Agreement:

         (a)      Organization and Good Standing. The Backup Servicer has been
duly organized and is validly existing and in good standing under the laws of
its jurisdiction of organization, 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, including the servicing of Contracts;

         (b)      Due qualification. The Backup Servicer is duly qualified to do
business as a foreign 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 and has made all filings and registrations necessary to
perform its obligations under this 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 (A) asserting the invalidity of this Agreement, (B)
seeking to prevent the consummation of any of the transactions contemplated by
this Agreement, or (C) seeking

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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; and

         (g)      No Consents. 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.

         SECTION 2.3 Backup Servicer Termination and Resignation.

         (a)      Prior to the time the Backup Servicer receives a Transfer
Notice, the Controlling Party may terminate this Agreement for any reason in its
sole judgment and discretion upon delivery of thirty (30) days advance written
notice to the other parties hereto of such termination; provided that the Rating
Agency Condition is satisfied with respect thereto. Reasonable expenses incurred
by the Backup Servicer in respect of the foregoing sentence shall be reimbursed
by the Servicer in accordance with Section 2.4 hereunder.

         (b)      Prior to the time the Backup Servicer receives a Transfer
Notice, the Backup Servicer may resign from its obligations and duties under
this Agreement for any reason in its sole judgment and discretion upon delivery
of thirty (30) days advance written notice to the other parties hereto and the
Rating Agencies of such resignation. No such resignation shall become effective
until a successor Backup Servicer appointed by the Servicer shall have assumed
the Backup Servicer's duties, obligations and liabilities hereunder. Any such
successor Backup Servicer must be an established servicer of motor vehicle loans
reasonably acceptable to the Issuer, the Indenture Trustee, XLCA and the Rating
Agencies. In the event a successor Backup Servicer is not appointed within
thirty (30) days, the resigning Backup Servicer may petition a court of
competent jurisdiction for appointment of a successor. Upon the resignation of
the Backup Servicer, the Backup Servicer shall cooperate with the transitioning
to a new backup servicer or successor servicer.

         SECTION 2.4 Compensation; Payment of Expenses by Backup Servicer.

         (a)      (i) On each Distribution Date prior to its appointment as
Successor Servicer, the Backup Servicer shall be entitled to receive from the
Servicer the fees (the "Backup Servicer Fees") set forth in Item I.A. on the
attached Schedule II for its performance of the Verification and Confirmation
Duties. Additionally, on each Distribution Date prior to its appointment as
Successor Servicer, the Backup Servicer shall be entitled to receive from the
Servicer the reimbursable expenses set forth in Item II.A. on the attached
Schedule II (the "Backup Servicer Expenses") and amounts it is entitled in
respect of indemnification from the Servicer pursuant to this Agreement.

                  (ii)     To the extent the Servicer does not remit payment in
full to the Backup Servicer on any Distribution Date the Backup Servicer Fees
and Backup Servicer Expenses, the Backup Servicer shall, upon five (5) days
prior written notice to the Indenture Trustee and XLCA, be entitled to such
Backup Servicer Fees and Backup Servicer Expenses from funds distributed
pursuant to the Sale and Servicing Agreement or Indenture, as applicable, if so
directed by XLCA, on the Distribution Date immediately succeeding the date of
delivery of such notice; provided, that, such Backup Servicer Expenses shall be
paid to the Backup Servicer solely from amounts distributed

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pursuant to Section 4.03(xii) of the Sale and Servicing Agreement and Section
5.06(a) of the Indenture.

         (b)      As compensation for its performance as Successor Servicer, on
each Distribution Date following its appointment as Successor Servicer, the
Backup Servicer shall be entitled to receive the Servicing Fee as provided in
the Sale and Servicing Agreement, as modified by Schedule III hereto.

                                   ARTICLE III

                               THE BACKUP SERVICER

         SECTION 3.1 Liability of Backup Servicer; Indemnities.

         (a)      The Backup Servicer shall be liable hereunder only to the
extent of the obligations in this Agreement specifically undertaken by the
Backup Servicer and the representations and warranties made by the Backup
Servicer hereunder.

         (b)      The Backup Servicer shall indemnify, defend and hold harmless
the other parties hereto and their 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 such party through the Backup
Servicer's breach of this Agreement (other than a breach caused by the
negligence, willful misfeasance or bad faith of any other party hereto), the
negligence (excluding errors in judgment), willful misfeasance or bad faith 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, claim, damage or
liability arose out of, or was imposed upon the Backup Servicer through the
Servicer's breach of this Agreement or the negligence, willful misfeasance or
bad faith of the Servicer in the performance of its duties under this Agreement
or by reason of reckless disregard of the Servicer's obligations and duties
under this Agreement.

         XLCA 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, claim, damage or liability arose out of, or was
imposed upon the Backup Servicer through XLCA's breach of the Insurance
Agreement, the negligence, willful misfeasance or bad faith of XLCA in the
performance of its duties as Controlling Party (excluding errors in judgment) or
by reason of reckless disregard of XLCA's obligations and duties as Controlling
Party.

         The Servicer and the Issuer shall (solely, in the case of the Issuer,
from amounts paid pursuant to, as applicable, (I) Section 5.06(a), sixth, of the
Indenture, (II) Sections 4.03(x) and 4.03(xii) of the Sale and Servicing
Agreement and (III) prior to the Backup Servicer's appointment as Successor
Servicer, Section 4.04(b) of the Sale and Servicing Agreement) jointly and
severally indemnify, defend and hold harmless the Backup Servicer and its
officers, directors, employees, representatives and agents, from and against,
and reimburse the Backup Servicer for, any and all claims, expenses,

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obligations, liabilities, losses, damages, injuries (to person, property, or
natural resources), penalties, stamp or other similar taxes, actions, suits,
judgments, reasonable costs and expenses (including reasonable attorney's and
agent's fees and expenses) of whatever kind or nature regardless of their merit,
incurred by the Backup Servicer directly or indirectly relating to, or arising
from, claims against the Backup Servicer by reason of its participation in the
transaction contemplated hereby, including without limitation all reasonable
costs associated with claims for damages to persons or property, and reasonable
attorneys' and consultants' fees and expenses and court costs except to the
extent caused by the Backup Servicer's negligence, willful misfeasance or bad
faith 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 Contracts (collectively, "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 harmless 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 willful misconduct of any third party with respect to the
Contracts. The Backup Servicer shall have no duty, responsibility, obligation or
liability (collectively, "liability") for the acts or omissions of any such
third party. If any error, inaccuracy or omission (collectively, "error") exists
in any information provided to the Backup Servicer and such errors cause or
materially contribute to the Backup Servicer making or continuing any error
(collectively, "continuing errors"), the Backup Servicer shall have no liability
for such continuing errors; provided, however, that this provision shall not
protect the Backup Servicer against any liability which would otherwise be
imposed by reason of willful misconduct, bad faith or negligence in discovering
or correcting any error or in the performance of its duties contemplated herein.

         The Backup Servicer shall have no responsibility and shall not be in
default hereunder or incur any liability for any failure, error, malfunction or
any delay in carrying out any of its duties under this Agreement if such failure
or delay in carrying out any of its duties under this Agreement results from the
Backup Servicer acting in accordance with information prepared or supplied by a
Person other than the Backup Servicer (or contractual agents) or the failure of
any such other Person to prepare or provide such information. The Backup
Servicer shall have no responsibility, shall not be in default and shall incur
no liability for (i) any act or failure to act of any third party (other than
its contractual agents), including the Servicer or XLCA, (ii) any inaccuracy or
omission in a notice or communication received by the Backup Servicer from any
third party (other than its contractual agents), (iii) the invalidity or
unenforceability of any Contract under applicable law, (iv) the breach or
inaccuracy of any representation or warranty made with respect to any Contract
or Financed Vehicle, or (v) the acts or omissions of any successor Backup
Servicer.

         The Servicer and the Issuer shall (solely, in the case of the Issuer,
from amounts paid pursuant to, as applicable, (I) Section 5.06(a), sixth, of the
Indenture, (II) Sections 4.03(x) and 4.03(xii) of the Sale and Servicing
Agreement and (III) prior to the Backup Servicer's appointment as Successor
Servicer, Section 4.04(b) of the Sale and Servicing Agreement) jointly and
severally indemnify (subject to the limitation provided in subsection (e) below)
and hold harmless the Backup Servicer, its

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respective officers, employees and agents harmless 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 (i) the negligence or misconduct of any third party, other
than contractual agents of the Backup Servicer, with respect to the Contracts or
Financed Vehicles, and (ii) the performance of the Backup Servicer's duties
hereunder and under the Sale and Servicing Agreement other than if the loss,
liability or expense was incurred by the Backup Servicer as a result of the
Backup Servicer's willful misfeasance, negligence or bad faith.

         In the event the Backup Servicer becomes aware of errors and/or
continuing errors which, in the opinion of the Backup Servicer, impair its
ability to perform its services hereunder, the Backup Servicer shall promptly
notify the other parties hereto of such errors and/or continuing errors. With
the prior consent of the Controlling Party, the Backup Servicer may undertake to
reconstruct any data or records appropriate to correct such errors and/or
continuing errors and to prevent future continuing errors. The Backup Servicer
shall be entitled to recover its costs thereby expended.

         (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, without interest.

         When the Backup Servicer incurs expenses after the occurrence of a
Servicer Default, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or any other applicable
federal or state bankruptcy, insolvency or similar law.

         (f)      The provisions of this Section 3.1 shall survive the
termination of this Agreement.

         SECTION 3.2 Limitation on Liability of Backup Servicer and Others.
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 other parties
hereto or any party to the Sale and Servicing 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 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 rely in good
faith on the advice of counsel or on any document of any kind prima facie
properly executed and submitted by any Person respecting any matters arising
under this Agreement.

         SECTION 3.3 Corporate Existence. The Backup Servicer shall maintain its
existence and rights as a corporation under the laws of the jurisdiction of its
incorporation and preserve its qualification to do business as a foreign
corporation in each jurisdiction in which the failure to so qualify would have a
material adverse effect on the validity or enforceability of any Contract, this
Agreement or on the ability of the Backup Servicer to perform its duties under
this Agreement.

         SECTION 3.4 Insurance. The Backup Servicer shall maintain adequate
insurance in amounts and with terms customarily subscribed by companies in the
same industry performing similar

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functions to those of the Backup Servicer in its role as Backup Servicer or
Successor Servicer, as applicable.

         SECTION 3.5 Compliance with Laws. The Backup Servicer covenants with
the parties hereto that, upon the expiration of the Transfer Period, the
practices used or to be used by the Backup Servicer to monitor collections with
respect to the Contracts and repossess and dispose of the Financed Vehicles
related to the Contracts will be, in all material respects, legal, proper and in
conformity with the requirements of all applicable federal and state laws, rules
and regulations. Upon the expiration of the Transfer Period, the Backup Servicer
will be in possession of all state and local licenses (including all debt
collection licenses) required for it to perform its services hereunder, and none
of such licenses shall have been suspended, revoked or terminated.

                                   ARTICLE IV

                       BACKUP SERVICER TERMINATION EVENTS

         SECTION 4.1 Termination Event. For purposes of this Agreement, each of
the following shall constitute a Termination Event (subsections (a) through (d)
shall further 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 written notice of such failure, requiring the
same to be remedied, shall have been given to the Backup Servicer by the
Controlling Party; or

         (b)      (i) The commencement of an involuntary case under the federal
bankruptcy laws, as now or hereinafter in effect, or another present or future
federal or state bankruptcy, insolvency or similar law and such case is not
dismissed within 60 days; or (ii) the entry of a decree or order for relief by a
court or regulatory authority having jurisdiction in respect of the Backup
Servicer in an involuntary case under the federal bankruptcy laws, as now or
hereafter in effect, or another present or future, federal or state, bankruptcy,
insolvency or similar law, or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Backup
Servicer or of any substantial part of its property or ordering the winding up
or liquidation of the affairs of the Backup Servicer; or

         (c)      The commencement by the Backup Servicer of a voluntary case
under the federal bankruptcy laws, as now or hereafter in effect, or any other
present or future, federal or state, bankruptcy, insolvency or similar law, or
the consent by the Backup Servicer to the appointment of or taking possession by
a receiver, liquidator, assignee, trustee, custodian, sequestrator or other
similar official of the Backup Servicer or of any substantial part of its
property or the making by the Backup Servicer of an assignment for the benefit
of creditors or the failure by the Backup Servicer generally to pay its debts as
such debts become due or the taking of corporate action by the Backup Servicer
in furtherance of any of the foregoing; or

                                       11

<PAGE>

         (d)      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 thirty (30) days after written notice thereof shall have been given to
the Backup Servicer by the Controlling Party, the circumstances or condition in
respect of which such representation, warranty or statement was incorrect shall
not have been eliminated or otherwise cured; or

         (e)      Non-payment of amounts due and owing to the Backup Servicer
pursuant to Section 2.4(a)(ii) or Section 2.4(b), as applicable, which
non-payment shall not be cured by the second succeeding Distribution Date after
the date on which written notice of such non-payment shall have been received by
the Indenture Trustee and XLCA.

         SECTION 4.2 Consequences of a Termination Event.

         (a)      If a Backup Servicer Event of Default (as defined in Section
4.1 above) shall occur and be continuing, the Controlling Party may (or shall,
at the direction of Holders evidencing not less than 25% of the outstanding
principal amount of the Notes, if the Indenture Trustee is the Controlling
Party), by notice given in writing to the Backup Servicer with a copy of such
writing to the other parties hereto and the Rating Agencies, 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 other parties hereto in effecting the termination of the
responsibilities and rights of the terminated Backup Servicer under this
Agreement.

         (b)      In the event of a Termination Event pursuant to Section
4.1(e), this Agreement shall terminate upon expiration of the given cure period
and the Backup Servicer shall then have no duties or obligations under this
Agreement except as otherwise provided herein.

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

         SECTION 5.1 Waiver; Amendment. Neither this Agreement nor any provision
hereof may be waived, amended or modified orally, but only by an instrument in
writing signed by the parties hereto; provided that any such amendment shall not
materially and adversely affect the interests of any Noteholder; provided,
further, that any such amendment shall be deemed not to materially and adversely
affect the interests of any Noteholder if the Rating Agency Condition is
satisfied.

         SECTION 5.2 GOVERNING LAW AND WAIVER OF JURY TRIAL. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK WITHOUT REGARD TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF (OTHER
THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW) AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS AGREEMENT SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS. EACH PARTY HERETO HEREBY IRREVOCABLY
WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS

                                       12

<PAGE>

AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY OR BY THE SALE AND SERVICING
AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.

         SECTION 5.3 CONSENT TO JURISDICTION. EACH PARTY TO THIS AGREEMENT (I)
AGREES THAT ANY SUIT, ACTION OR OTHER LEGAL PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT SHALL BE BROUGHT IN A COURT OF RECORD IN THE CITY AND
STATE OF NEW YORK OR IN THE COURTS OF THE UNITED STATES OF AMERICA LOCATED IN
THE SOUTHERN DISTRICT OF NEW YORK, (II) CONSENTS TO THE JURISDICTION OF EACH
SUCH COURT IN ANY SUCH SUIT, ACTION OR PROCEEDING, AND (III) WAIVES ANY
OBJECTION WHICH THEY MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH SUIT, ACTION,
OR PROCEEDING IN ANY OF SUCH COURTS AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING HAS BEEN BROUGHT IN AN INCONVENIENT FORUM.

         SECTION 5.4 Rating Agencies. The Backup Servicer will provide any
Rating Agency with such reasonable assistance as is necessary to evaluate such
Rating Agency's rating of the Notes.

         SECTION 5.5 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall be for any
reason whatsoever held invalid, then such covenants, agreements, provisions or
terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement.

         SECTION 5.6 Assignment. Notwithstanding anything to the contrary
contained in this Agreement, this Agreement may not be assigned by the Backup
Servicer without the prior consent of the Controlling Party and the Rating
Agencies.

         SECTION 5.7 Binding Effect; No 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. Nothing in this
Agreement, express or implied, shall give to any Person, other than the parties
hereto and their successors hereunder, any benefit or any legal or equitable
right, remedy or claim under this Agreement.

         SECTION 5.8 Counterparts. For the purpose of facilitating its execution
and for other purposes, this Agreement may be executed simultaneously in any
number of counterparts, each of which counterparts shall be deemed to be an
original, and all of which counterparts shall constitute but one and the same
instrument.

         SECTION 5.9 Notices. All demands, notices and communications under this
Agreement shall be in writing, personally delivered or mailed by certified
mail-return receipt requested, or by facsimile transmission, and shall be deemed
to have been duly given upon receipt:

         (a)      in the case of the Backup Servicer, at the following address:
4315 Pickett Road, St. Joseph, Missouri 64503, Attention: John J. Chappell and
Joseph D. Booz, facsimile (816) 671-2029;

                                       13

<PAGE>

         (b)      in the case of the Servicer, at the following address: 27051
Towne Centre Drive, Suite 100, Foothill Ranch, CA 92610, Attention: Don P.
Duffy, Executive Vice President, facsimile (949) 465-3992;

         (c)      in the case of the Issuer, at the following address: c/o
Wilmington Trust Company, Rodney Square North, 1100 North Market Street,
Wilmington, Delaware 19890-1600, facsimile 302-636-4140;

         (d)      in the case of XLCA, at the following address: 1221 Avenue of
the Americas, New York, New York 10020, Attention: Surveillance, (212) 478-3587,
confirmation (212) 478-3400; and

         (e)      in the case of the Indenture Trustee, at the following
address: 4 New York Plaza, 6th Floor, New York, New York 10004, Attention:
Institutional Trust Services - Onyx Acceptance Owner Trust 2004-C, facsimile
(212) 623-5933;

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

         SECTION 5.10 Confidentiality.

         (a)      Unless otherwise consented to by the Servicer, each of the
parties hereto hereby agrees that it will not disclose the contents of this
Agreement, or any other confidential or proprietary information furnished in
connection with the matters contemplated by this Agreement by the Servicer to
any Person other than its affiliates (which affiliates shall have agreed to be
bound by this Section 5.10), auditors and attorneys or as required by applicable
law or the Sale and Servicing Agreement.

         (b)      The Backup Servicer, whether in its performance of the
Verification and Confirmation Duties or in its capacity as Successor Servicer,
represents and warrants to the Servicer that it presently maintains safeguards
designed to protect the security and confidentiality of "Customer Information"
that the Servicer may allow the Backup Servicer to access in order to perform
its duties under this Agreement and the Sale and Servicing Agreement. "Customer
Information" is non-public personal information in the possession of the
Servicer about obligors under the Contracts, including, without limitation, any
disclosure that an obligor is a party to a Contract. The Backup Servicer agrees
that "Customer Information" will be held in strict confidence and accessed only
for the purpose of carrying out its duties under this Agreement and the Sale and
Servicing Agreement. The Backup Servicer agrees to protect this "Customer
Information" according to commercially reasonable standards and no less
rigorously than it protects its own customers' confidential information.

         SECTION 5.11 Non-Petition Covenant.

         (a)      With respect to the Issuer, prior to the date that is one year
and one day after the payment in full of all amounts owing under the Notes, the
Backup Servicer will not institute against the Issuer or join any other Person
in instituting against the Issuer any bankruptcy, reorganization, arrangement,
insolvency or liquidation proceedings or other similar proceedings under the
laws of the United States of America or any state of the United States.

         (b)      With respect to Finco, the Backup Servicer will not institute
against Finco or join any other Person in instituting against Finco any
bankruptcy, reorganization, arrangement, insolvency or

                                       14

<PAGE>

liquidation proceedings or other similar proceedings under the laws of the
United States of America or any state of the United States.

         (c)      The provisions of this Section 5.11 shall survive the
termination of this Agreement.

         SECTION 5.12 Limitation of Liability of Owner Trustee and Indenture
Trustee.

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

         (b)      Notwithstanding anything contained herein to the contrary,
this Agreement has been countersigned by JPMorgan Chase Bank not in its
individual capacity but solely as Indenture Trustee and in no event shall
JPMorgan Chase Bank have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer.

                                       15

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Backup
Servicing Agreement to be duly executed by their respective officers as of the
day and year first above written.

                                     ONYX ACCEPTANCE CORPORATION

                                     By: _______________________________________
                                     Name: _____________________________________
                                     Title: ____________________________________

                                     XL CAPITAL ASSURANCE INC.

                                     By: _______________________________________
                                     Name: _____________________________________
                                     Title: ____________________________________

                                     JPMORGAN CHASE BANK, not in its individual
                                     capacity, but solely as Indenture Trustee

                                     By: _______________________________________
                                     Name: _____________________________________
                                     Title: ____________________________________

                                     ONYX ACCEPTANCE OWNER TRUST 2004-C

                                     By: Wilmington Trust Company,
                                         not in its individual capacity,
                                         but solely as Owner Trustee

                                         By: ___________________________________
                                         Name: _________________________________
                                         Title: ________________________________

                                     SYSTEMS & SERVICES TECHNOLOGIES, INC.

                                     By: _______________________________________
                                     Name: _____________________________________
                                     Title: ____________________________________

Backup Servicing Agreement (2004-C) - Signature Page

<PAGE>

                                     ONYX ACCEPTANCE FINANCIAL CORPORATION

                                     By: _______________________________________
                                     Name: _____________________________________
                                     Title: ____________________________________

Backup Servicing Agreement (2004-C) - Signature Page

<PAGE>

                                   SCHEDULE I

               DESCRIPTION OF VERIFICATION AND CONFIRMATION DUTIES

                               (BACKUP SERVICING)

         The Backup Servicer shall provide the following services related to
backup servicing in connection with the Contracts.

         (i)      The Backup Servicer will work with the Servicer's personnel to
obtain the necessary systems and data information from the servicing systems in
use by the Servicer. Using this information, the Backup Servicer will create a
set of conversion routines and database mapping programs, as necessary, that
will enable the Backup Servicer to receive data from the Servicer on a monthly
basis (at the time and in the manner specified in Section 2.1(a) of the Backup
Servicing Agreement) and to ensure that the data is readable.

         The monthly data shall include the following:

         -        Obligor information

         -        Loan financial information

         -        Collateral information

         -        Payment/Transaction history

         -        Information edits

         (ii)     On a monthly basis, the Backup Servicer shall (x) verify
receipt of the Information Package required to be delivered by the Servicer (at
the time and in the manner specified in Section 2.1(a) of the Backup Servicing
Agreement) and (y) verify that the records and data contained in the Information
Package are in a readable format.

         (iii)    No later than 3:00 p.m. New York City time on the third
Business Day after receipt of the Information Package from the Servicer, the
Backup Servicer shall provide the Servicer, the Indenture Trustee, the Trust
Agent (as defined in the Sale and Servicing Agreement) and XLCA a certificate
signed by an Authorized Officer, stating that (i) the Backup Servicer has
reviewed the Information Package for the related Collection Period, (ii) a
review of items (x), (xi) (with respect to "Net Collections" only), (xii), (xiv)
and (xv) in Section 3.09(a) of the Sale and Servicing Agreement as reflected on
the Distribution Date Statement for the related Servicer Report Date has been
made under such Authorized Officer's supervision and (iii) to the best of such
Authorized Officer's knowledge, the data in such Information Package ties to
such items on the Distribution Date Statement, resulting in no discrepancies
between them. If the preceding statement cannot be made in the affirmative, such
Authorized Officer shall, in lieu of the certificate described in the preceding
sentence, deliver a written statement indicating the nature of any and all
discrepancies. The Backup Servicer and the Servicer shall attempt to reconcile
all discrepancies with respect to such Distribution Date Statement prior to 3:00
p.m. New York City time on the Business Day preceding such Distribution Date,
and, at or prior to such time, the Servicer shall deliver (by telex, facsimile,
electronic transmission, first class mail, overnight courier or personal
delivery) to the Issuer, the Trust Agent, the Indenture Trustee, the Backup
Servicer, and XLCA (A) such Distribution Date Statement, if applicable, restated
to reflect all discrepancies that have up to that point been reconciled by the
Servicer and the Backup Servicer and (B) a written statement indicating the
remaining discrepancies,

                                       I-1

<PAGE>

if any. If the Servicer and the Backup Servicer are unable to reconcile all
discrepancies prior to the time set forth in the preceding sentence, the
Distribution Date Statement, as delivered in accordance with the preceding
sentence or the Sale and Servicing Agreement, as applicable, shall be deemed to
be the Distribution Date Statement for such Distribution Date and the related
Servicer Report Date. In the event the Backup Servicer and the Servicer are
unable to reconcile such remaining discrepancies by the end of business on the
fifth (5) Business Day after the related Distribution Date, the Servicer shall,
if so directed by the Controlling Party, cause a firm of nationally-recognized
independent certified public accountants acceptable to the Controlling Party, at
the Servicer's expense, to audit the reports prepared and delivered by the
Servicer and, prior to the next succeeding Servicer Report Date, reconcile the
discrepancies. The effect, if any, of such reconciliation shall be reflected in
the Distribution Date Statement for such next succeeding Servicer Report Date.

                                       I-2

<PAGE>

                                   SCHEDULE II

                         FEES, EXPENSES & DISTRIBUTIONS

                      SYSTEMS & SERVICES TECHNOLOGIES, INC.

                                  FEE SCHEDULE:
                       ONYX ACCEPTANCE OWNER TRUST 2004-C

<TABLE>
<S>      <C>                                                              <C>
I.       FEES

         A.       Verification and Confirmation Duties

                  1.       One-Time Setup Fee                             $4,500

                  2.       Monthly Fee (3)              the lesser of     1.25 bsp or
                                                                          $3,750 per month

         B.       Successor Servicing (1)

                  1.       One Time Transition Fee(2)   the greater of    $5.00 per Active Contract
                                                                          or
                                                                          $50,000

                  2.       Monthly Fee (3) (4)          the greatest of   100 bsp
                                                                          or
                                                                          $6.50 per Active Contract
                                                                          per month
                                                                          or
                                                                          $1,500 per month
</TABLE>

II.      EXPENSES

         A.       Verification and Confirmation Duties

         SST shall be reimbursed as described in Section 2.4(a) of the Agreement
         for all reasonable out-of-pocket costs and expenses incurred in
         connection with its performance of the Verification and Confirmation
         Duties, including travel and lodging expenses and outside legal
         expenses.

         B.       Successor Servicing Expenses (1)

         SST shall be reimbursed as part of the Servicing Fee for all reasonable
         out-of-pocket expenses associated with: asset recovery, liquidation,
         legal proceedings related to replevin actions or obligor bankruptcies,
         together with travel and lodging incidental thereto; global retitling

                                      II-1

<PAGE>

         efforts required by law: and, insurance tracking, if any. Any such out
         of pocket expenses associated with asset recovery and/or liquidation
         shall be reimbursed from Liquidation Proceeds in accordance with the
         provisions of the Sale and Servicing Agreement as modified by Schedule
         III of the Agreement. Additionally, SST shall be reimbursed for any
         mailing expenses (including postage) incurred by it associated with any
         "hello/goodbye" correspondence directed to obligors not to exceed $0.50
         per letter but only to the extent such expense has not otherwise been
         paid by or on behalf of Onyx as required by the Basic Documents. SST
         shall be reimbursed as part of the Servicing Fee for all other
         reasonable out-of-pocket expenses; provided that SST shall have
         incurred such expenses with the prior written consent of XLCA (which
         consent shall not be unreasonably withheld).

III.     MISCELLANEOUS (1)

         A.       Claim Filing Costs

         In the event SST files credit enhancement insurance claims (e.g.,
         Vendor Single Interest) in connection with any contract serviced by
         SST, SST shall receive $25.00 per filing.

         B.       Administrative Fees/Servicing Charges

         SST shall receive all administrative fees, including extension
         processing fees, NSF fees and late charges received by SST during any
         monthly collection period.

         C.       Deficiency Collections

         Under separate agreement, SST may provide deficiency collections
         services on a contingency fee basis.

--------------
(1)      These items shall only apply to SST's performance of successor
servicing duties and constitute the fees and reimbursable expenses due SST as
successor servicer as described in the definition of Servicing Fee as modified
by Schedule III, item 1 to the Backup Servicing Agreement.

(2)      This fee shall cover all transfer expenses and boarding fees related to
the physical and electronic transfer of the Contract Files and, if applicable,
Contract Documents.

(3)      Basis points are annualized (i.e., applicable basis points/12) and
shall be based on beginning of month outstanding principal balance of each
individual Active Contract, as defined below.

(4)      SST shall receive this fee for all "Active Contracts" for any full or
partial month where it functions as the Successor Servicer. Active Contract is
defined as any Contract other than: (i) prepaid, fully satisfied Contracts; (ii)
Contracts in which the Financed Vehicle has been liquidated and SST has posted
the Liquidation Proceeds or any other anticipated proceeds (e.g., credit
enhancement insurance); or (iii) Contracts in which SST has completed all work
in connection with processing and receiving insurance payoffs.

                                      II-2

<PAGE>

                                  SCHEDULE III

                             ACTIVE SERVICING DUTIES

         Pursuant to Section 2.1(b) of the Backup Servicing Agreement, to which
this Schedule III is a part, SST has agreed that, in the event the Servicer is
terminated, resigns or otherwise ceases to function as Servicer under the Sale
and Servicing Agreement, and SST has received a Transfer Notice from the
Indenture Trustee, upon the expiration of the Transfer Period, SST will assume
the duties, liabilities and obligations of the Servicer under the Sale and
Servicing Agreement, as modified in accordance with this Schedule III.

         For purposes of determining SST's duties, liabilities and obligations,
as Successor Servicer under the Sale and Servicing Agreement, at such time as
SST becomes the Successor Servicer, the Sale and Servicing Agreement will be
deemed to be modified as follows; provided, that all parties hereto acknowledge
that the modifications of the Servicer's duties listed below, including but not
limited to the obligation to comply with SAS 70 as noted in Item 26, shall apply
only to SST as Servicer and specifically shall not apply to Onyx or to any
affiliate of Onyx:

         1.       Section 1.01: Clause (i) of the definition of "Servicing Fee"
shall not be applicable and clause (ii) of the definition of "Servicing Fee,"
related to that portion of the servicing fee due to the Backup Servicer, shall
be deemed to include fees and reimbursable expenses due to SST as the Successor
Servicer under the Backup Servicing Agreement as set forth on Schedule II
thereof and Liquidation Expenses for the related Collection Period up to the
amount of Liquidation Proceeds deposited into the Collection Account for such
Collection Period.

         2.       Section 1.01: The definition of "Liquidation Expenses" shall
be modified by replacing the parenthetical "(not to exceed Liquidation
Proceeds)" in the first sentence of such definition with "(including, without
limitation, expenses associated with Obligor bankruptcies)" and adding the
following proviso at the end of the first sentence:

         "provided, that if Net Liquidation Proceeds for any Collection Period
         are less than zero (without giving effect to the proviso in the
         definition of Net Liquidation Proceeds), aggregate Liquidation Expenses
         in excess of aggregate Liquidation Proceeds for such Collection Period
         shall be included in Liquidation Expenses for the next succeeding
         Collection Period."

         3.       Section 1.01: The definition of "Net Liquidation Proceeds"
shall be deleted in its entirety and replaced with the following:

         "Net Liquidation Proceeds" means the amount derived from subtracting
         from the Liquidation Proceeds of all Defaulted Contracts for the
         related Collection Period the Liquidation Expenses incurred by the
         Servicer for all Defaulted Contracts during such Collection Period;
         provided, that if Net Liquidation Proceeds for any Collection Period
         equals a number less than zero, Net Liquidation Proceeds shall be
         deemed to be zero for such Collection Period.

         4.       Section 1.01: The definition of "Net Collections" shall be
modified by deleting the term "Net Liquidation Proceeds" in subsection (i) and
replacing such term with "Liquidation Proceeds."

                                      III-1

<PAGE>

         5.       Section 2.01(f): Section 2.01(f) shall be deleted in its
entirety and replaced by the following:

         The Servicer shall file or cause to be filed, after receiving the prior
         written consent of the Insurer, between the dates of February 27, 2009
         and August 26, 2009, in the office of the Secretary of State of the
         State of Delaware appropriate UCC financing statement amendments
         continuing the effectiveness of (i) UCC-1 financing statement number
         42415026, originally filed on August 26, 2004, naming the Seller as
         debtor and the Trust as secured party and (ii) UCC-1 financing
         statement number 42415109, originally filed on August 26, 2004, naming
         the Trust as debtor and the Indenture Trustee as secured party, and
         shall take such other action as reasonably requested by the Indenture
         Trustee, with the prior written consent of the Insurer, or the Insurer
         to continue the perfection of the respective interests of the Trust and
         the Indenture Trustee in the Contracts. From time to time and with the
         prior written consent of the Insurer, the Servicer shall cause to be
         taken such actions as are necessary to continue the first priority
         security interest of the Indenture Trustee in the Financed Vehicles and
         their proceeds (other than, as to such priority, any statutory lien
         arising by operation of law after the Closing Date which is prior to
         such interest), including, without limitation, the filing of financing
         statements, amendments thereto or continuation statements and the
         making of notations on records or documents of title. SST may retain
         third party vendors in connection with its duties hereunder. Unless
         otherwise paid by the Insurer, SST shall be reimbursed as part of the
         Servicing Fee for all reasonable expenses necessary to perform the
         duties described in Section 2.01(f). The parties to the Backup
         Servicing Agreement agree to cooperate with SST in facilitating the
         performance of the duties described in Section 2.01(f).

         6.       Section 2.01(g): Unless otherwise paid by XLCA, SST shall be
reimbursed as part of the Servicing Fee for all reasonable expenses (i)
necessary to perform the duties described in Section 2.01(g), which shall be
performed only upon the prior written consent of XLCA, related to the
preservation and protection of the interests of the Trust, the Indenture
Trustee, the Noteholders and XLCA in the Contracts, the related Financed
Vehicles and the proceeds thereof and (ii) incurred in connection with causing
the preparation and delivery of each Opinion of Counsel delivered pursuant to
Section 2.01(g), which shall be prepared and delivered only upon the prior
written consent of XLCA. Upon any change in the name, identity or corporate
structure of the Seller or Onyx or the relocation of the state of organization
of either of them, SST may procure an Opinion of Counsel upon which it may rely
in its performance of the duties set forth in Section 2.01(g). The parties to
the Backup Servicing Agreement agree to cooperate with SST in facilitating the
performance of the duties described in Section 2.01(g). SST may retain third
party vendors in connection with its duties hereunder.

         7.       Section 2.01(i): SST shall be reimbursed as part of the
Servicing Fee for all reasonable expenses necessary to perform the duties
described in Section 2.01(i) (as modified by this Schedule III), which shall be
performed only upon the prior written consent of XLCA, related to the perfection
and the maintenance of perfection, as against all third parties, of the
Indenture Trustee's right, title and interest in and to the Contracts and the
maintenance of the first priority security interest in the Financed Vehicles and
the proceeds thereof.

         8.       Section 2.02: SST shall be deemed to have relied on the
representations and warranties made by the Seller in Section 2.02.

                                      III-2

<PAGE>

         9.       Section 2.03: The final sentence in Section 2.03 shall be
deemed to include references to SST, such that the sole remedy of SST, along
with the Issuer, the Indenture Trustee and the Noteholders, with respect to a
breach of the Seller's representations and warranties pursuant to Section 2.02
shall be to require the Seller to repurchase Contracts pursuant this Section;
provided, however, that the Seller shall indemnify SST, as well as the Owner
Trustee, the Trust Agent, the Indenture Trustee, XLCA, the Issuer and the
Noteholders, against all costs, expenses, losses, damages, claims and
liabilities, including reasonable fees and expenses of counsel, which may be
asserted against or incurred by any of them as a result of third-party claims
arising out of the events or facts giving rise to such breach.

         10.      Section 2.05(b): The last sentence of Section 2.05(b) shall be
deemed to be modified to provide that SST, as Successor Servicer, shall, upon
reasonable prior written notice, permit the Issuer, the Indenture Trustee and
XLCA or their respective duly authorized representatives, attorneys or auditors
to inspect the Contract Files and the related accounts, records and computer
systems maintained by the Servicer at such times as such Persons may request
during normal business hours at the office of SST in a manner that does not
cause undue disruption or interference with SST's business.

         11.      Section 2.05(d): Section 2.05(d) shall be deemed to be
modified by (i) deleting the term "Net Liquidation Proceeds" in subsection (iv)
thereof and replacing such term with "Liquidation Proceeds" and (ii) adding the
following sentence to the end of such section:

         Onyx shall assist SST in respect of the reporting requirements set
forth in this section.

         12.      Section 2.07: The penultimate sentence of Section 2.07,
related to indemnification by the Servicer with respect to certain taxes, shall
not apply to SST.

         13.      Section 2.08: The penultimate sentence of Section 2.08
regarding the Servicer's obligations to deliver Contract Files and Contract
Documents shall not apply to SST; provided, that, any such expenses incurred by
SST in connection with obtaining the Contract Files and, if applicable, the
Contract Documents in connection with its transition to Successor Servicer (and,
if applicable, Successor Custodian) shall be reimbursable to SST as set forth in
Schedule II of the Backup Servicing Agreement.

         14.      Section 3.01: SST shall not be responsible for the preparation
of the U.S. Partnership Tax Returns (Form 1065) for the Owner Trustee referenced
in the first paragraph of Section 3.01. Additionally, SST shall not be
responsible for the duties of the Servicer set forth in the second, third and
fourth paragraphs of Section 3.01, related to delivery of documents on the
Closing Date and deposits of amounts in the Collection Account on the Closing
Date and on each Prefunding Transfer Date. Also, the final paragraph of Section
3.01, related to the payment of certain fees by the Servicer, shall not apply to
SST. Furthermore, the term "Net Liquidation Proceeds" in the second sentence of
the fifth paragraph of Section 3.01 shall be deleted and replaced with the term
"Liquidation Proceeds."

         15.      Section 3.03: The last sentence of Section 3.03, relating to
the remittance of Net Liquidation Proceeds and Net Insurance Proceeds to the
Collection Account, shall be modified by deleting the term "Net Liquidation
Proceeds" and replacing such term with "Liquidation Proceeds."

                                      III-3

<PAGE>

         16.      Section 3.04: Section 3.04, relating to maintenance of a
Blanket Insurance Policy by the Servicer, shall not apply to SST.

         17.      Section 3.05: Unless otherwise paid by XLCA, SST shall be
reimbursed as part of the Servicing Fee for all expenses necessary to perform
the duties described in Section 3.05, which shall be performed only upon the
prior written consent of XLCA, related to the maintenance of security interests
in Financed Vehicles. The parties to the Backup Servicing Agreement agree to
cooperate with SST in facilitating the performance of the duties described in
Section 3.05.

         18.      Section 3.06(a): SST shall be deemed to make the covenants
contained in Section 3.06(a) as of the end of the Transfer Period.

         19.      Section 3.06(b): Section 3.06(b), setting forth certain
representations and warranties of the Servicer, shall not apply to SST.

         20.      Section 3.07: Section 3.07, setting forth the Servicer's
obligation to repurchase Contracts under limited circumstances, shall not apply
to SST.

         21.      Section 3.08: Section 3.08, setting forth the compensation
payable to the Servicer, shall not apply to SST. SST will be entitled to
compensation as set forth in the Backup Servicing Agreement.

         22.      Section 3.09: Section 3.09 shall be deemed to be modified to
add the following sentence to the end of Section 3.09(a) and Section 3.09(b):

         Onyx shall assist SST in respect of the reporting requirements set
forth in this section.

         23.      Section 3.09(a): Subsection 3.09(a)(xii) shall be deleted in
its entirety and replaced with the following:

         The aggregate amount of Liquidation Proceeds received and Liquidation
Expenses incurred in respect of Defaulted Contracts.

         24.      Section 3.09(b): Subsection 3.09(b)(iii)(D), relating to the
Servicer's monthly report as to Liquidated Contracts, shall be modified by
deleting the term "Net Liquidation Proceeds" and replacing such term with
"Liquidation Proceeds and Liquidation Expenses."

         25.      Section 3.10: The annual statement as to compliance required
to be delivered by the Servicer related to the preceding fiscal year of the
Servicer shall be deemed to relate only to that portion of the fiscal year in
which SST acts as Servicer.

         26.      Section 3.11: Section 3.11 shall be deleted in its entirety
and replaced with the following:

         SST shall cause a firm of independent certified public accountants,
         which may also render other services to SST or its affiliates, to
         deliver to the Issuer, the Trust Agent, the Indenture Trustee and the
         Insurer, within 75 days after the end of the fiscal year ending
         December 31, 2004, and within 120 days after the end of each fiscal
         year thereafter, commencing with the fiscal year ending December 31,
         2005, (i) an opinion by a firm of nationally recognized independent
         certified public accountants on the financial position of SST at the
         end of the

                                      III-4

<PAGE>

         relevant fiscal year and the results of operations and changes in
         financial position of SST for such year then ended on the basis of an
         examination conducted in accordance with generally accepted auditing
         standards, and (ii) a report from such independent certified public
         accountants to the effect that based on an examination of certain
         specified documents and records relating to the servicing of SST's loan
         portfolio conducted substantially in compliance with SAS 70 (the
         "Applicable Accounting Standards"), such firm is of the opinion that
         such servicing has been conducted in compliance with the Applicable
         Accounting Standards except for (a) such exceptions as such firm shall
         believe to be immaterial and (b) such other exceptions as shall be set
         forth in such statement.

         27.      Section 3.12: Section 3.12 shall be deemed to be modified to
provide that the "reasonable access" that the Servicer must provide to the
Noteholders, the Issuer, the Owner Trustee, the Trust Agent, the Indenture
Trustee and XLCA shall be access upon reasonable prior written notice, during
normal business hours at the office of SST in a manner that does not cause undue
disruption or interference with SST's business.

         28.      Section 3.14: Section 3.14, related to indemnification by the
Servicer, shall not apply to SST.

         29.      Section 4.01(a): Section 4.01(a), related to the establishment
of certain Trust Accounts prior to the Closing Date, shall not apply to SST.

         30.      Section 4.01(b): The penultimate sentence of Section 4.01(b),
related to direction from the Servicer for investing funds in the Payahead
Account and payment of earnings on such funds to the Servicer, shall not apply
to SST.

         31.      Section 4.01(c): The portions of Section 4.01(c) related to
direction from the Servicer for investing funds in the Collection Account, the
Spread Account, the Prefunding Account and the Capitalized Interest Account, and
payment of earnings on such funds to the Servicer, shall not apply to SST.

         32.      Section 4.01(d): The portions of Section 4.01(d) related to
direction from the Servicer for investing funds in the Collection Account, the
Spread Account, the Prefunding Account and the Capitalized Interest Account,
shall not apply to SST.

         33.      Section 4.02(a): Section 4.02(a), relating to the remittance
of monies to the Collection Account shall be modified by deleting the term "Net
Liquidation Proceeds" in the first sentence and replacing such term with
"Liquidation Proceeds."

         34.      Section 4.04(c): The portions of Section 4.04(c) related to
direction from the Servicer for investing funds in the Spread Account shall not
apply to SST. At its option, XLCA may direct the investment of funds on deposit
in the Spread Account in accordance with Section 4.04(c).

         35.      Section 4.05: Section 4.05 shall be deemed to be modified to
add the following sentence to the end of Section 4.05(a) and Section 4.05(b):

         Onyx shall assist SST in respect of the reporting requirements set
forth in this section.

                                      III-5

<PAGE>

         36.      Section 4.05(a)(xii): Subsection 4.05(a)(xii) shall be deleted
in its entirety and replaced with the following:

         The aggregate amount of Liquidation Proceeds received and Liquidation
Expenses incurred in respect of Defaulted Contracts.

         37.      Section 4.06(a): Section 4.06(a), related to the establishment
of the Capitalized Interest Account, shall not apply to SST.

         38.      Section 4.07(a): Section 4.07(a), related to the establishment
of the Prefunding Account, shall not apply to SST.

         39.      Section 4.07(c): The portions of Section 4.07(c) related to
direction from the Servicer for investing funds in the Prefunding Account shall
not apply to SST.

         40.      Section 6.01(b): Section 6.01(b), related to certain
indemnifications by the Servicer, shall not apply to SST.

         41.      Section 6.01(d): Section 6.01(d), related to certain
indemnifications by the Servicer, shall not apply to SST.

         42.      Section 6.01(e): Section 6.01(e), related to certain
indemnifications by the Servicer, shall not apply to SST.

         43.      Section 6.02(a): Section 6.02(a) shall be deemed to reference
the Servicer's "state of incorporation" rather than the "State of Delaware" and
the clause "to protect the validity and enforceability of Contract Documents and
this Agreement" shall be deemed to be deleted from the end of this section and
replaced with the clause "under applicable law to perform its obligations under
the Backup Servicing Agreement and this Agreement."

         44.      Section 6.02(b): Section 6.02(b) shall be deleted in its
entirety and replaced with the following:

         SST shall not consolidate with or merge into any other corporation or
         convey, transfer or lease all or substantially all of its assets as an
         entirety to any Person or engage in any corporate transaction pursuant
         to which the surviving or successor entity is not JPMorgan Chase Bank
         unless otherwise consented to in writing by XLCA.

         45.      Section 6.03(b): Section 6.03(b) shall be deemed to be
modified by deleting the words "or permit any action to be taken by others" in
that Section.

         46.      Section 6.04: The first sentence of Section 6.04, related to
the ability of the Servicer to resign, as applied to SST as Successor Servicer,
shall be deemed to be modified to state as follows:

         The Servicer shall not resign from the duties and obligations hereby
         imposed on it except upon determination that the continued performance
         by the Servicer of its duties hereunder would cause it to be in
         violation of legal requirements, said determination to be accompanied
         by an Opinion of Counsel, satisfactory to the Issuer, XLCA and the
         Indenture Trustee, to such effect.

                                      III-6

<PAGE>

         47.      Section 6.05: The first paragraph of Section 6.05, related to
the limitation of the Servicer's liability, shall be deemed to be modified to
state as follows:

         Neither the Servicer nor any of the directors, officers, employees or
         agents of the Servicer shall be under any liability to the Issuer, the
         Indenture Trustee, the Trust Agent or the Noteholders except as
         provided under this Agreement and the Backup Servicing Agreement, for
         any action taken or for refraining from the taking of any action
         pursuant to this Agreement or for errors in judgment; provided,
         however, that this provision shall not protect the Servicer or any such
         person against any liability that would otherwise be imposed by reason
         of willful misfeasance, bad faith or negligence (except errors in
         judgment) in the performance of duties or by reason of reckless
         disregard of obligations and duties under this Agreement. The Servicer
         and any director, officer, employee or agent of the Servicer may rely
         in good faith on any advice of counsel, Opinion of Counsel or on any
         Officer's Certificate or certificate of auditors or on any document of
         any kind prima facie properly executed and submitted by any person
         respecting any matters arising under this Agreement.

         48.      Section 7.01(h): Section 7.01(h) shall be amended such that
the occurrence of any Trigger Event described in Sections 6.01(a)(i) (only to
the extent that the Seller fails to comply therewith), (iv),(v), (vi) and (ix)
of the Insurance Agreement shall not be a Servicer Default.

         49.      Section 9.02(a): SST shall not be responsible for the initial
filing of any financing statement required by Section 9.02(a), and will be
reimbursed as part of the Servicing Fee for all reasonable expenses necessary to
perform the remainder of the duties described in Section 9.02(a), which shall be
performed only upon the prior written consent of XLCA, related to the continued
perfection of the interests of the Issuer, the Noteholders, the Indenture
Trustee, the Trust Agent and XLCA in the Contracts and in the proceeds thereof;
provided, that such obligations shall be deemed satisfied to the extent SST
shall perform in accordance with Section 2.01(f). SST may retain third party
vendors in connection with its duties hereunder. The parties to the Backup
Servicing Agreement agree to cooperate with SST in the performance of the
Servicer's duties described in Section 9.02(a).

         50.      Section 9.02(c): The final sentence of Section 9.02(c) shall
be deemed to be modified to add the qualifier "Unless otherwise agreed to in
writing by XLCA" to the beginning of the sentence. Furthermore, the Seller shall
be required to give 60 days' prior written notice to SST of any relocation of
the state of organization of the Seller under the circumstances described in the
first sentence of Section 9.02(c).

         51.      Section 9.02(g): Section 9.02(g) shall be deemed to be
modified to provide that the inspection rights granted to the Owner Trustee, the
Trust Agent, the Indenture Trustee and XLCA and their respective agents to the
Servicer's records are subject to reasonable prior written notice, during normal
business hours at the office of SST in a manner that does not cause undue
disruption or interference with SST's business.

         52.      Section 9.02(h): The "Upon request" language beginning Section
9.02(h) shall be deemed to read "Upon prior request."

                                      III-7

<PAGE>

         53.      Section 9.02(i)(i) and (ii): Unless otherwise paid by XLCA,
SST shall be reimbursed as part of the Servicing Fee for all reasonable expenses
incurred in connection with causing the preparation and delivery of each Opinion
of Counsel delivered pursuant to Section 9.02(i)(i) and (ii), which shall be
prepared and delivered only upon the prior written consent of XLCA.

                                      III-8Exhibit 10.1

 

Exhibit 10.1

FIRST AMENDMENT TO BUSINESS LOAN AGREEMENT

This First Amendment to Business Loan Agreement (the “Amendment”) is made as
of May 7, 2004, between Bank of America, N. A.(“Bank”), and Pacific Sunwear of
California, Inc., a California corporation (the “Borrower”).

RECITALS

     A. Borrower and Bank entered into that certain Business Loan Agreement
dated as of January 30, 2004 (the “Agreement”).

     B. Borrower and Bank desire to amend the Agreement as herein provided.

AGREEMENT

     1. Definitions. Capitalized terms used but not defined in this Amendment
shall have the meaning given to them in the Agreement.

     2. Amendments. The Agreement is hereby amended as follows:

          2.1 Section 3.1(a) of the Agreement is amended in its entirety to read as
follows:

     “(a) Unused Commitment Fee. The Borrower agrees to pay a fee
on any difference between the Commitment and the amount of credit
it actually uses, determined by the weighted average credit
outstanding during the specified period. The fee will be
calculated at (i) 0.20% per year, if consolidated EBITDA (as
defined in Section 7.3 hereof) is equal to or greater than
$100,000,000, or (ii) 0.25% per year, if consolidated EBITDA is
less than $100,000,000. The calculation of credit outstanding
shall include undrawn amounts of letters of credit and shipside
bonds. The fee will be payable quarterly in arrears until
expiration of the availability period.”

          2.2 In subsection (c) of Section 7.10 of the Agreement, the first sentence
is amended to read as follows:

     “(c) capital stock repurchases not in excess of (x) Fifty
Million Dollars ($50,000,000) in the aggregate from the date of
this Agreement through May 6, 2004, or (y) Twenty-Five Million
Dollars ($25,000,000) in the aggregate from May 7, 2004 through
the Expiration Date; provided that, after giving effect to such
stock repurchase (i) No Event of Default under this Agreement has
occurred and is continuing and (ii) Borrower has not less than
Fifty Million Dollars ($50,000,000) in Unencumbered Liquid Assets.
.. . . ”

     3. Representations and Warranties. Borrower hereby represents and
warrants to Bank that: (i) no default specified in the Agreement and no event
which with notice or

1

 

lapse of time or both would become such a default has occurred and is
continuing and has not been previously waived, (ii) the representations and
warranties of Borrower pursuant to the Agreement are true on and as of the date
hereof as if made on and as of said date, (iii) the making and performance by
Borrower of this Amendment have been duly authorized by all necessary action,
and (iv) no consent, approval, authorization, permit or license is required in
connection with the making or performance of the Agreement as amended hereby.

     4. Conditions. This Amendment will be effective when the Bank receives
the following items, in form and content acceptable to the Bank:

          4.1 This Amendment duly executed by all parties hereto.

          4.2 Payment of all out-of-pocket expenses, including attorneys’ fees,
incurred by the Bank in connection with the preparation of this Amendment.

     5. Effect of Amendment. Except as provided in this Amendment, the
Agreement shall remain in full force and effect and shall be performed by the
parties hereto according to its terms and provisions.

     IN WITNESS WHEREOF, this Amendment has been executed by the parties hereto
as of the date first above written.

	 	 	 	 	 
	 	 	BANK OF AMERICA, N.A.
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	

	 	Name:	 	 
	

	 	 	 	
 
	

	 	Title:	 	 
	

	 	 	 	
 
	 
	 	 	 	 
	 	 	PACIFIC SUNWEAR OF CALIFORNIA,
INC.
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	 	 	Name: Greg Weaver
	 	 	Title: Chairman and Chief Executive Officer
	 
	 	 	 	 
	

	 	By:	 	 
	

	 	 	 	
 
	 	 	Name: Carl Womack
	 	 	Title: Chief Financial Officer

2

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