Document:

exv10w2

 

Exhibit 10.2

Execution Copy

INDEMNIFICATION AGREEMENT

among

FINANCIAL SECURITY ASSURANCE INC.,

AFS FUNDING TRUST

and

CREDIT SUISSE FIRST BOSTON LLC

Dated as of October 26, 2004

$145,000,000 Class A-1 2.08% Asset Backed Notes, Series 2004-D-F

$236,000,000 Class A-2 2.53% Asset Backed Notes, Series 2004-D-F

$197,000,000 Class A-3 2.98% Asset Backed Notes, Series 2004-D-F

$172,000,000 Class A-4 3.43% Asset Backed Notes, Series 2004-D-F

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page

	Section 1.  Definitions

	 	 	1	 
	Section 2. Representations, Warranties and Agreements of Financial Security

	 	 	3	 
	Section 3. Representations, Warranties and Agreements of the Underwriters

	 	 	5	 
	Section 4. Indemnification

	 	 	6	 
	Section 5. Indemnification Procedures

	 	 	6	 
	Section 6. Contribution

	 	 	7	 
	Section 7. Miscellaneous

	 	 	8	 

EXHIBIT A — Opinion of Assistant General Counsel

 

 

INDEMNIFICATION AGREEMENT

     INDEMNIFICATION AGREEMENT dated as of October 26, 2004, among FINANCIAL
SECURITY ASSURANCE INC. (“Financial Security”), AFS FUNDING TRUST, (the
“Seller”) and CREDIT SUISSE FIRST BOSTON LLC, as the Representative (as defined
below):

     Section 1. Definitions. For purposes of this Agreement, the following
terms shall have the meanings provided below:

     “Agreement” means this Indemnification Agreement, as amended from time to
time.

     “Closing Date” means November 9, 2004.

     “Federal Securities Laws” means the Securities Act, the Securities
Exchange Act of 1934, the Trust Indenture Act of 1939, the Investment Company
Act of 1940, the Investment Advisers Act of 1940 and the Public Utility Holding
Company Act of 1935, each as amended from time to time, and the rules and
regulations in effect from time to time under such Acts.

     “Financial Security Agreements” means this Agreement, the Spread Account
Agreement, the Spread Account Agreement Supplement and the Insurance Agreement.

     “Financial Security Information” has the meaning provided in Section 2(g)
hereof.

     “Financial Security Party” means any of Financial Security, its parent,
subsidiaries and affiliates, and any shareholder, director, officer, employee,
agent or “controlling person” (as such term is used in the Securities Act) of
any of the foregoing.

     “Indemnified Party” means any party entitled to any indemnification
pursuant to Section 4 hereof.

     “Indemnifying Party” means any party required to provide indemnification
pursuant to Section 4 hereof.

     “Insurance Agreement” means the Insurance and Indemnity Agreement, dated
as of October 26, 2004 among Financial Security, the Trust, AmeriCredit
Financial Services, Inc., AmeriCredit Corp. and AFS Funding Trust.

     “Losses” means (a) any actual out-of-pocket damages incurred by the party
entitled to indemnification or contribution hereunder, (b) any actual
out-of-pocket costs or expenses incurred by such party, including reasonable
fees or expenses of its counsel and other expenses incurred in connection with
investigating or defending any claim, action or other proceeding which entitle
such party to be indemnified hereunder (subject to the limitations set forth in
Section 5 hereof), to the extent not paid, satisfied or reimbursed from funds
provided by any other Person other than an affiliate of such party (provided
that the foregoing shall not create or imply any obligation to pursue recourse
against any such other Person), plus (c) interest on the amount paid by the
party entitled to indemnification or contribution from the date of such

 

 

payment to the date of payment by the party who is obligated to indemnify
or contribute hereunder at the statutory rate applicable to judgments for
breach of contract.

     “Offering Document” means the Prospectus and any other material or
documents delivered by the Underwriters to any Person in connection with the
offer or sale of the Securities.

     “Person” means any individual, partnership, joint venture, corporation,
trust, unincorporated organization or other organization or entity (whether
governmental or private).

     “Policy” means the financial guaranty insurance policy delivered by
Financial Security with respect to the Securities.

     “Prospectus” means, collectively, the Prospectus relating to the
Securities dated July 10, 2003 and the Prospectus Supplement dated October 25,
2004 (the “Prospectus Supplement”) relating to the Securities.

     “Representative” means Credit Suisse First Boston LLC., as representative
of the Underwriters.

     “Securities” means the Trust’s $145,000,000 Class A-1 2.08% Asset Backed
Notes, $236,000,000 Class A-2 2.53% Asset Backed Notes, $197,000,000 Class A-3
2.98% Asset Backed Notes and $172,000,000 Class A-4 3.43% Asset Backed Notes
issued pursuant to the Series 2004-D-F Indenture.

     “Securities Act” means the Securities Act of 1933, as amended from time to
time.

     “Seller Party” means any of the Seller, its parent, subsidiaries and
affiliates and any employee, agent or “controlling person” (as such term is
used in the Securities Act) of any of the foregoing.

     “Spread Account Agreement” means the Spread Account Agreement, as amended
and restated, dated as of May 11, 1998, and as further amended as of September
10, 2003, among Financial Security, AFS Funding Trust, the collateral agent
named therein and the trustees specified therein, as the same may be amended,
supplemented or otherwise modified in accordance with the terms thereof.

     “Spread Account Agreement Supplement” means the Series 2004-D-F Supplement
to Spread Account Agreement, dated as of October 26, 2004, among Financial
Security, AFS Funding Trust, the collateral agent named therein and the
trustees specified therein.

     “Trust” means AmeriCredit Automobile Receivables Trust 2004-D-F.

     “Underwriter Information” has the meaning provided in Section 3(c) hereof.

     “Underwriter Party” means any of the Underwriters, its respective parent,
subsidiaries and affiliates and any shareholder, director, officer, employee,
agent or “controlling person” (as such item is used in the Securities Act) of
any of the foregoing.

2

 

     “Underwriters” means Credit Suisse First Boston LLC., UBS Securities LLC,
Barclays Capital Inc., Lehman Brothers Inc. and Morgan Stanley & Co.
Incorporated, as underwriters.

     “Underwriting Agreement” means the Underwriting Agreement, dated as of
October 25, 2004 among the Seller, AmeriCredit Financial Services, Inc. and the
Representative.

     Section 2. Representations, Warranties and Agreements of Financial
Security. Financial Security represents, warrants and agrees as follows:

     (a) Organization, Etc. Financial Security is a stock insurance
company duly organized, validly existing and authorized to transact
financial guaranty insurance business under the laws of the State of New
York.

     (b) Authorization, Etc. The Policy and the Financial Security
Agreements have been duly authorized, executed and delivered by Financial
Security.

     (c) Validity, Etc. The Policy and the Financial Security Agreements
constitute valid and binding obligations of Financial Security,
enforceable against Financial Security in accordance with their terms,
subject, as to the enforcement of remedies, to bankruptcy, insolvency,
reorganization, rehabilitation, moratorium and other similar laws
affecting the enforceability of creditors’ rights generally applicable in
the event of the bankruptcy or insolvency of Financial Security and to
the application of general principles of equity and subject, in the case
of this Agreement, to principles of public policy limiting the right to
enforce the indemnification provisions contained herein.

     (d) Exemption From Registration. The Policy is exempt from
registration under the Securities Act.

     (e) No Conflicts. Neither the execution or delivery by Financial
Security of the Policy or the Financial Security Agreements, nor the
performance by Financial Security of its obligations thereunder, will
conflict with any provision of the certificate of incorporation or the
bylaws of Financial Security nor result in a breach of, or constitute a
default under, any material agreement or other instrument to which
Financial Security is a party or by which any of its property is bound
nor violate any judgment, order or decree applicable to Financial
Security of any governmental or regulatory body, administrative agency,
court or arbitrator having jurisdiction over Financial Security (except
that, in the published opinion of the Securities and Exchange Commission,
the indemnification provisions of this Agreement, insofar as they relate
to indemnification for liabilities arising under the Securities Act, are
against public policy as expressed in the Securities Act and are
therefore unenforceable).

     (f) Financial Information. The consolidated balance sheets of
Financial Security as of December 31, 2003 and December 31, 2002 and the
related consolidated statements of income, changes in shareholder’s
equity and cash flows for each of the three years in the period ended
December 31, 2003, and the interim consolidated balance sheets of
Financial Security as of March 31, 2004 (and March 31, 2003) and June 30,
2004 (and June 30, 2003) (unaudited), and the related statements of
income, changes in shareholder equity and cash flows for the interim
period then ended, which are incorporated by

3

 

reference in the Prospectus, fairly present in all material respects
the financial condition of Financial Security as of such dates and for
such periods in accordance with generally accepted accounting principles
consistently applied (subject as to interim statements to normal year-end
adjustments) and since the date of the most current interim consolidated
balance sheet referred to above there has been no change in the financial
condition of Financial Security which would materially and adversely
affect its ability to perform its obligations under the Policy.

     (g) Financial Security Information. The information in the
Prospectus Supplement set forth or incorporated by reference under the
caption “The Insurer” (as revised from time to time in accordance with
the provisions hereof, the “Financial Security Information”) is limited
and does not purport to provide the scope of disclosure required to be
included in a prospectus with respect to a registrant in connection with
the offer and sale of securities of such registrant registered under the
Securities Act. Within such limited scope of disclosure, however, as of
the date of the Prospectus Supplement and as of the Closing Date, the
Financial Security Information does not contain any untrue statement of a
material fact, or omit to state a material fact necessary to make the
statements contained therein, in the light of the circumstances under
which they were made, not misleading.

     (h) Additional Information. Financial Security will furnish to the
Underwriters or the Seller, upon request of the Underwriters or the
Seller, as the case may be, copies of Financial Security’s most recent
financial statements (annual or interim, as the case may be) which fairly
present in all material respects the financial condition of Financial
Security as of the dates and for the periods indicated, in accordance
with generally accepted accounting principles consistently applied except
as noted therein (subject, as to interim statements, to normal year-end
adjustments). In addition, if the delivery of a Prospectus relating to
the Securities is required at any time prior to the expiration of nine
months after the time of issue of the Prospectus in connection with the
offering or sale of the Securities, the Seller or the Underwriters will
notify Financial Security of such requirement to deliver a Prospectus and
Financial Security will promptly provide the Underwriters and the Seller
with any revisions to the Financial Security Information that are in the
judgment of Financial Security necessary to prepare an amended Prospectus
or a supplement to the Prospectus.

     (i) Opinion of Counsel. Financial Security will furnish to the
Underwriters and the Seller on the closing date for the sale of the
Securities an opinion of its Assistant General Counsel, to the effect set
forth in Exhibit A attached hereto, dated such closing date and addressed
to the Seller and the Underwriters.

     (j) Consents and Reports of Independent Accountants. Financial
Security will furnish to the Underwriters and the Seller, upon request,
as comfort from its independent accountants in respect of its financial
condition, (i) at the expense of the Person specified in the Insurance
Agreement, a copy of the Prospectus, including either a manually signed
consent or a manually signed report of Financial Security’s independent
accountants and (ii) the quarterly review letter by Financial Security’s
independent accountants in respect of the most recent interim financial
statements of Financial Security.

4

 

Nothing in this Agreement shall be construed as a representation or warranty by
Financial Security concerning the rating of its insurance financial strength by
Fitch Ratings, Moody’s Investors Service, Inc., Standard & Poor’s and Rating
and Investment Information, Inc. or any other rating assigned by a rating
agency (collectively, the “Rating Agencies”). The Rating Agencies, in
assigning such ratings, take into account facts and assumptions not described
in the Prospectus and the facts and assumptions which are considered by the
Rating Agencies, and the ratings issued thereby, are subject to change over
time.

     Section 3. Representations, Warranties and Agreements of the Underwriters.
Each of the Underwriters represents, warrants and agrees as follows:

     (a) Compliance With Laws. Such Underwriter will comply in all
material respects with all legal requirements in connection with offers
and sales of the Securities and make such offers and sales in the manner
provided in the Prospectus.

     (b) Offering Document. Such Underwriter will not use, or distribute
to other broker-dealers for use, any Offering Document in connection with
the offer and sale of the Securities unless such Offering Document
includes such information as has been furnished by Financial Security for
inclusion therein and the information therein concerning Financial
Security has been approved by Financial Security in writing. Financial
Security hereby consents to the information in respect of Financial
Security included in the Prospectus. Each Offering Document which
described the Policy will include the following statement:

“The Policy is not covered by the Property/Casualty
Insurance Security Fund specified in Article 76 of the
New York Insurance Law”.

Each Offering Document including financial statements with respect to
Financial Security prepared in accordance with generally accepted
accounting principles (but excluding any Offering Document in which such
financial statements are incorporated by reference) will include the
following statement immediately preceding such financial statements:

“The New York State Insurance Department recognizes
only statutory accounting practices for determining
and reporting the financial condition and results of
operations of an insurance company, for determining
its solvency under the New York Insurance Law, and for
determining whether its financial condition warrants
the payment of a dividend to its stockholders. No
consideration is given by the New York State Insurance
Department to financial statements prepared in
accordance with generally accepted accounting
principles in making such determinations.”

     (c) Underwriter Information. All material provided by the
Underwriters for inclusion in the Prospectus (as revised from time to
time, the “Underwriter Information”),

5

 

insofar as such information relates to the Underwriters, is true and
correct in all material respects. In respect of the Prospectus
Supplement, the Underwriter Information is limited to the information set
forth (i) on the cover page of the Prospectus Supplement, the information
in the table under the headings entitled “Price to Public”, “Underwriting
Discounts” and “Proceeds to Seller” and (ii) in the body of the
Prospectus Supplement and within the Underwriting section, (a) the
paragraph immediately following the Class A-4 Notes Underwriter
commitment table, (b) the two paragraphs immediately following the
paragraph containing three bulleted sub-paragraphs and (c) the third-to-
last paragraph and the final paragraph of the section.

     Section 4. Indemnification.

     (a) Financial Security agrees, upon the terms and subject to the
conditions provided herein, to indemnify, defend and hold harmless each
Seller Party and each Underwriter Party against (i) any and all Losses
incurred by them with respect to the offer and sale of the Securities and
resulting from Financial Security’s breach of any of its representations,
warranties or agreements set forth in Section 2 hereof and (ii) any and
all Losses to which any Seller Party or Underwriter Party may become
subject, under the Securities Act or otherwise, insofar as such Losses
arise out of or result from an untrue statement of a material fact
contained in any Offering Document or the omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or omission was made in the
Financial Security Information included therein in accordance with the
provisions hereof.

     (b) Each of the Underwriters, agrees, severally but not jointly,
upon the terms and subject to the conditions provided herein, to
indemnify, defend and hold harmless each Financial Security Party against
(i) any and all Losses incurred by them with respect to the offer and
sale of the Securities and resulting from the Underwriters’ breach of any
of its representations, warranties or agreements set forth in Section 3
hereof and (ii) any and all Losses to which any Financial Security Party
may become subject, under the Securities Act or otherwise, insofar as
such Losses arise out of or result from an untrue statement of a material
fact contained in any Offering Document or the omission to state therein
a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only
to the extent, that such untrue statement or omission was made in the
Underwriter Information of the Underwriter included therein.

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

     Section 5. Indemnification Procedures. Except as provided below in
Section 6 with respect to contribution, the indemnification provided herein by
an Indemnifying Party shall be the exclusive remedy of any and all Indemnified
Parties for the breach of a representation, warranty or agreement hereunder by
an Indemnifying Party; provided, however, that each

6

 

Indemnified Party shall be entitled to pursue any other remedy at law or
in equity for any such breach so long as the damages sought to be recovered
shall not exceed the Losses incurred thereby resulting from such breach. In
the event that any action or regulatory proceeding shall be commenced or claim
asserted which may entitle an Indemnified Party to be indemnified under this
Agreement, such party shall give the Indemnifying Party written or telegraphic
notice of such action or claim reasonably promptly after receipt of written
notice thereof. The Indemnifying Party shall be entitled to participate in
and, upon notice to the Indemnified Party, assume the defense of any such
action or claim in reasonable cooperation with, and with the reasonable
cooperation of, the Indemnified Party. The Indemnified Party will have the
right to employ its own counsel in any such action in addition to the counsel
of the Indemnifying Party, but the fees and expenses of such counsel will be at
the expense of such Indemnified Party, unless (a) the employment of counsel by
the Indemnified Party at its expense has been authorized in writing by the
Indemnifying Party, (b) the Indemnifying Party has not in fact employed counsel
to assume the defense of such action within a reasonable time after receiving
notice of the commencement of the action, or (c) the named parties to any such
action or proceeding (including any impleaded parties) include both the
Indemnifying Party and one or more Indemnified Parties, and the Indemnified
Parties shall have been advised by counsel that (A) there may be one or more
legal defenses available to them which are different from or additional to
those available to the Indemnifying Party and (B) the representation of the
Indemnifying Party and such Indemnified Parties by the same counsel would be
inappropriate or contrary to prudent practice (in which case, if such
Indemnified Parties notify the Indemnifying Party in writing that they elect to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense of such
action or proceeding on behalf of such Indemnified Parties, it being
understood, however, that the Indemnifying Party shall not, in connection with
any one such action or proceeding or separate but substantially similar or
related actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the reasonable fees and
expenses of more than one separate firm of attorneys at any time for all Seller
Parties, one such firm for all Underwriter Parties and one such firm for all
Financial Security Parties, as the case may be, which firm shall be designated
in writing by the Seller in respect of the Seller Parties, by the Underwriters
in respect of the Underwriter Parties and by Financial Security in respect of
the Financial Security Parties), in each of which cases the fees and expenses
of counsel will be at the expense of the Indemnifying Party and all such fees
and expenses will be reimbursed promptly as they are incurred. The
Indemnifying Party shall not be liable for any settlement of any such claim or
action unless the Indemnifying Party shall have consented thereto or be in
default in its obligations hereunder. Any failure by an Indemnified Party to
comply with the provisions of this Section shall relieve the Indemnifying Party
of liability only if such failure is prejudicial to the position of the
Indemnifying Party and then only to the extent of such prejudice.

     Section 6. Contribution.

     (a) To provide for just and equitable contribution if the
indemnification provided by any Indemnifying Party is determined to be
unavailable or insufficient for any Indemnified Party (other than due to
application of this Section), each Indemnifying Party (severally and not
jointly in the case of the Underwriters) shall contribute to the Losses
arising from any breach of any of its representations, warranties or
agreements contained in this Agreement on the basis of the relative fault
of each of the parties as set

7

 

forth in Section 6(b) below; provided, however, that an Indemnifying
Party shall in no event be required to contribute to all Indemnified
Parties an aggregate amount in excess of the Losses incurred by such
Indemnified Parties resulting from the breach of representations,
warranties or agreements contained in this Agreement.

     (b) The relative fault of each Indemnifying Party, on the one hand,
and of each Indemnified Party, on the other, shall be determined by
reference to, among other things, whether the breach of, or alleged
breach of, any representations, warranties or agreements contained in
this Agreement relates to information supplied by, or action within the
control of, the Indemnifying Party or the Indemnified Party and the
parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such breach.

     (c) The parties agree that Financial Security shall be solely
responsible for the Financial Security Information and the Underwriters
shall be solely responsible for the Underwriter Information and that the
balance of each Offering Document shall be the responsibility of the
Seller.

     (d) Notwithstanding anything in this Section 6 to the contrary, the
Underwriters shall not be required to contribute an amount in excess of
the amount by which the total price of the Securities underwritten by the
Underwriters exceeds the amount of any damages that the Underwriters have
otherwise been required to pay in respect of such untrue statement or
omission.

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

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

     Section 7. Miscellaneous.

     (a) Notices. All notices and other communications provided for
under this Agreement shall be delivered to the address set forth below or
to such other address as shall be designated by the recipient in a
written notice to the other party or parties hereto.

8

 

	 	 	 	 	 
	If to Financial Security:	 	Financial Security Assurance Inc.
	 	 	350 Park Avenue
	 	 	New York, NY 10022
	 	 	Attention: Senior Vice President — Transaction Oversight
	 	 	Department (with a copy to the attention of the General Counsel)
	 	 	Re: AmeriCredit Automobile Receivables Trust 2004-D-F
	 	 	Policy No. 51589-N
	

	 	Confirmation:
	 	(212) 826-0100
	

	 	Telecopy Nos.:
	 	(212) 339-3518,
	

	 	 	 	(212) 339-3529

	 	 	 
	If to the Seller:

	 	AFS Funding Trust
	

	 	c/o Deutsche Bank Trust Company Delaware
	

	 	(f/k/a Bankers Trust (Delaware))
	

	 	E.A. Delle Donne Corporate Center
	

	 	Montgomery Building
	

	 	1011 Centre Road
	

	 	Wilmington, DE 19805-1266
	

	 	Attention: Corporate Trust Administration
	

	 	Confirmation: (302) 636-3305
	 
	 	 
	With a copy to:

	 	AmeriCredit Financial Services, Inc.
	

	 	Administrator of AFS Funding Trust
	

	 	801 Cherry Street, Suite 3900
	

	 	Fort Worth, TX 76102
	

	 	Attn: Chief Financial Officer
	

	 	Confirmation: (817) 302-7000
	

	 	Telecopy No.: (817) 302-7942
	 
	 	 
	If to the Underwriters:

	 	Credit Suisse First Boston LLC, as Representative
	

	 	11 Madison Avenue,
	

	 	New York, New York 10010
	

	 	Attention: Asset Finance
	

	 	Telecopy No.: (212) 797-2030

     (b) Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH, AND THIS AGREEMENT AND ALL MATTERS ARISING OUT OF OR RELATING IN
ANY WAY TO THIS AGREEMENT SHALL BE GOVERNED BY, THE LAW OF THE STATE OF
NEW YORK.

     (c) Assignments. This Agreement may not be assigned by any party
without the express written consent of each other party. Any assignment
made in violation of this Agreement shall be null and void.

9

 

     (d) Amendments. Amendments of this Agreement shall be in writing
signed by each party hereto.

     (e) Survival, Etc. The indemnity and contribution agreements
contained in this Agreement shall remain operative and in full force and
effect, regardless of (i) any investigation made by or on behalf of any
Indemnifying Party, (ii) the issuance of the Securities or (iii) any
termination of this Agreement or the Policy. The indemnification
provided in this Agreement will be in addition to any liability which the
parties may otherwise have and shall in no way limit any obligations of
the Seller under the Underwriting Agreement or the Insurance Agreement.

     (f) Counterparts. This Agreement may be executed in counterparts by
the parties hereto, and all such counterparts shall constitute one and
the same instrument.

[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

10

 

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

	 	 	 	 	 
	 	 	FINANCIAL SECURITY ASSURANCE INC.
	 	 	
By:
	 	/s/ Ravi Gandhi

Name: Ravi Gandhi

Title: Authorized Officer
	 	 	AFS FUNDING TRUST
	 	 	By: AmeriCredit Financial Services, Inc., as Administrator
	 	 	
By:
	 	/s/ J. Michael May

Name: J. Michael May

Title: Senior Vice President
	 	 	CREDIT SUISSE FIRST BOSTON LLC
	 	 	
By:
	 	/s/ John McWilliams

Name: John McWilliams

Title: Managing Director

[INDEMNITY AGREEMENT SIG. PAGE]

 

 

EXHIBIT A

OPINION OF ASSOCIATE GENERAL COUNSEL

     Based upon the foregoing, I am of the opinion that:

     1. Financial Security is a stock insurance company duly organized, validly
existing and authorized to transact financial guaranty insurance business under
the laws of the State of New York.

     2. The Policy and the Financial Security Agreements have been duly
authorized, executed and delivered by Financial Security.

     3. The Policy and the Financial Security Agreements constitute valid and
binding obligations of Financial Security, enforceable against Financial
Security in accordance with their terms, subject, as to the enforcement of
remedies, to bankruptcy, insolvency, reorganization, rehabilitation, moratorium
and other similar laws affecting the enforceability of creditors’ rights
generally applicable in the event of the bankruptcy or insolvency of Financial
Security and to the application of general principles of equity and subject, in
the case of the Indemnification Agreement, to principles of public policy
limiting the right to enforce the indemnification provisions contained therein
insofar as they relate to indemnification for liabilities arising under
applicable securities laws.

     4. The Policy is exempt from registration under the Securities Act of
1933, as amended (the “Act”).

     5. Neither the execution or delivery by Financial Security of the Policy
or the Financial Security Agreements, nor the performance by Financial Security
of its obligations thereunder, will conflict with any provision of the
certificate of incorporation or the bylaws of Financial Security or violate any
law or regulation, which violation would impair the binding effect or
enforceability of the Policy or any of the Agreements or, to the best of my
knowledge, result in a breach of, or constitute a default under, any agreement
or other instrument to which Financial Security is a party or by which it or
any of its property is bound or, to the best of my knowledge, violate any
judgment, order or decree applicable to Financial Security of any governmental
or regulatory body, administrative agency, court or arbitrator having
jurisdiction over Financial Security (except that in the published opinion of
the Securities and Exchange Commission the indemnification provisions of the
Indemnification Agreement, insofar as they relate to indemnification for
liabilities arising under the Act, are against public policy as expressed in
the Act and are therefore unenforceable).

     In addition, please be advised that I have reviewed the description of
Financial Security under the caption “The Insurer” in the Prospectus (the
“Offering Document”) of the Seller with respect to the Securities. The
information provided in the Offering Document with respect to Financial
Security is limited and does not purport to provide the scope of disclosure
required to be included in a prospectus with respect to a registrant under the
Act in connection with the public offer and sale of securities of such
registrant. Within such limited scope of disclosure,

A-1

 

     however, there has not come to my attention any information which would
cause me to believe that the description of Financial Security referred to
above, as of the date of the Offering Document or as of the date of this
opinion, contained or contains any untrue statement of a material fact or
omitted or omits to state a material fact necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading (except that I express no opinion with respect to any financial
statements or other financial information contained or referred to therein).

A-2exv10w3

 

Exhibit 10.3

Execution Copy

INSURANCE AND INDEMNITY AGREEMENT

among

FINANCIAL SECURITY ASSURANCE INC.,

AMERICREDIT AUTOMOBILE RECEIVABLES TRUST 2004-D-F,

AMERICREDIT FINANCIAL SERVICES, INC.,

AFS FUNDING TRUST

and

AMERICREDIT CORP.

Dated as of October 26, 2004

$145,000,000 Class A-1 2.08% Asset Backed Notes, Series 2004-D-F

$236,000,000 Class A-2 2.53% Asset Backed Notes, Series 2004-D-F

$197,000,000 Class A-3 2.98% Asset Backed Notes, Series 2004-D-F

$172,000,000 Class A-4 3.43% Asset Backed Notes, Series 2004-D-F

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page

	ARTICLE I DEFINITIONS
	 	 	1	 
	Section 1.1 Definitions
	 	 	1	 
	ARTICLE II REPRESENTATIONS, WARRANTIES AND COVENANTS
	 	 	2	 
	Section 2.1 Representations and Warranties of the Trust
	 	 	2	 
	Section 2.2 Affirmative Covenants of the Trust
	 	 	5	 
	Section 2.3 Negative Covenants of the Depositor on Behalf of the Trust
	 	 	9	 
	Section 2.4 [Reserved]
	 	 	11	 
	Section 2.5 [Reserved]
	 	 	11	 
	Section 2.6 [Reserved]
	 	 	12	 
	Section 2.7 Representations and Warranties with Respect to Funding
Trust and the Company
	 	 	12	 
	Section 2.8 Affirmative Covenants with Respect to the Company and
Funding Trust
	 	 	16	 
	Section 2.9 Negative Covenants with Respect to Funding Trust and the
Company
	 	 	20	 
	Section 2.10 Representations and Warranties of AmeriCredit
	 	 	22	 
	Section 2.11 Affirmative Covenants of AmeriCredit
	 	 	25	 
	Section 2.12 Negative Covenants of AmeriCredit
	 	 	28	 
	ARTICLE III THE POLICIES; REIMBURSEMENT; INDEMNIFICATION
	 	 	29	 
	Section 3.1 Issuance of the Policy
	 	 	29	 
	Section 3.2 Payment of Fees and Premium
	 	 	29	 
	Section 3.3 Reimbursement and Additional Payment Obligation
	 	 	30	 
	Section 3.4 Certain Obligations Not Recourse to AmeriCredit
	 	 	31	 
	Section 3.5 Indemnification
	 	 	31	 
	Section 3.6 Subrogation
	 	 	33	 
	ARTICLE IV FURTHER AGREEMENTS
	 	 	33	 
	Section 4.1 Effective Date; Term of Agreement
	 	 	33	 
	Section 4.2 Obligations Absolute
	 	 	33	 
	Section 4.3 Assignments; Reinsurance; Third-Party Rights
	 	 	34	 
	Section 4.4 Liability of Financial Security
	 	 	35	 
	Section 4.5 [Reserved]
	 	 	35	 
	Section 4.6 [Reserved]
	 	 	35	 
	ARTICLE V EVENTS OF DEFAULT; REMEDIES
	 	 	35	 
	Section 5.1 Events of Default
	 	 	35	 
	Section 5.2 Remedies; Waivers
	 	 	39	 

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TABLE OF CONTENTS

(continued)

	 	 	 	 	 
	 	 	Page

	ARTICLE VI MISCELLANEOUS
	 	 	40	 
	Section 6.1 Amendments, Etc.
	 	 	40	 
	Section 6.2 Notices
	 	 	40	 
	Section 6.3 Payment Procedure
	 	 	42	 
	Section 6.4 Severability
	 	 	42	 
	Section 6.5 Governing Law
	 	 	42	 
	Section 6.6 Consent to Jurisdiction
	 	 	43	 
	Section 6.7 Consent of Financial Security
	 	 	43	 
	Section 6.8 Counterparts
	 	 	44	 
	Section 6.9 Trial by Jury Waived
	 	 	44	 
	Section 6.10 Limited Liability
	 	 	44	 
	Section 6.11 Entire Agreement
	 	 	45	 

	 	 	 
	Appendix I

Annex I

Appendix A

	 	Definitions

Form of Note Policy

Conditions Precedent to Issuance of the Policy

 ii 

 

 

INSURANCE AND INDEMNITY AGREEMENT

     INSURANCE AND INDEMNITY AGREEMENT dated as of October 26, 2004 among
FINANCIAL SECURITY ASSURANCE INC. (“Financial Security”), AMERICREDIT
AUTOMOBILE RECEIVABLES TRUST 2004-D-F (the “Trust”), a Delaware statutory
trust, AFS FUNDING TRUST, a Delaware statutory trust (when referred to
individually hereunder, “Funding Trust,” when referred to as the seller under
the Sale and Servicing Agreement referred to below, the “Seller”), and
AMERICREDIT FINANCIAL SERVICES, INC. (the “Company”), a Delaware corporation
and AMERICREDIT CORP., a Texas corporation (“AmeriCredit”).

INTRODUCTORY STATEMENTS

     Funding Trust proposes to acquire the Receivables from the Company and
simultaneously to sell to the Trust all of its right, title and interest in and
to the Receivables and certain other property pursuant to the Sale and
Servicing Agreement. The Trust will issue the Certificate pursuant to the
Trust Agreement and Notes pursuant to the Indenture.

     Each Note will be secured by the Collateral. The Trust has requested that
Financial Security issue a financial guaranty insurance policy guarantying
certain distributions of interest and principal on the Notes on each Insured
Distribution Date (including any such distributions subsequently avoided as a
preference under applicable bankruptcy law) upon the terms, and subject to the
conditions, provided herein.

     The parties hereto desire to specify the conditions precedent to the
issuance of the Policy by Financial Security, the payment of premium in respect
of the Policy, the indemnity and reimbursement to be provided to Financial
Security in respect of amounts paid by Financial Security under the Policy or
otherwise and certain other matters.

     In consideration of the premises and of the agreements herein contained,
Financial Security, the Trust, the Company, Funding Trust and AmeriCredit
hereby agree as follows:

ARTICLE I

DEFINITIONS

     Section 1.1 Definitions. Capitalized terms used herein shall have the
meanings provided in Appendix I hereto or the meanings given such terms in the
AmeriCredit 2004-D-F Letter Agreement, the Sale and Servicing Agreement or the
Spread Account Agreement, unless the context otherwise requires.

 

 

ARTICLE II

REPRESENTATIONS, WARRANTIES AND COVENANTS

     Section 2.1 Representations and Warranties of the Trust. The Trust
represents and warrants, as of the date hereof and as of the Date of Issuance
(except as expressly provided herein), as follows:

     (a) Due Organization and Qualification. The Trust is duly formed and
validly existing as a Delaware statutory trust and is in good standing under
the laws of the State of Delaware. The Trust is duly qualified to do business,
is in good standing and has obtained all necessary licenses, permits, charters,
registrations and approvals (together, “approvals”) necessary for the conduct
of its business as currently conducted and as described in the Offering
Document and the performance of its obligations under the Transaction
Documents, in each jurisdiction in which the failure to be so qualified or to
obtain such approvals would render any Receivable or Transaction Document
unenforceable in any material respect or would otherwise have a material
adverse effect upon the Transaction.

     (b) Power and Authority. The Trust has all necessary trust power and
authority to conduct its business as currently conducted and as described in
the Offering Document, to execute, deliver and perform its obligations under
the Transaction Documents and has full power and authority to sell and assign
the Receivables as contemplated by the Transaction Documents and to consummate
the Transaction.

     (c) Due Authorization. The execution, delivery and performance of the
Transaction Documents by the Trust have been duly authorized by all necessary
trust action and do not require any additional approvals or consents or other
action by, or any notice to or filing with, any Person, including, without
limitation, any governmental entity.

     (d) Noncontravention. None of the execution and delivery of the
Transaction Documents by the Trust, the consummation of the transactions
contemplated thereby nor the satisfaction of the terms and conditions of the
Transaction Documents,

     (i) conflicts with, or results in any breach or violation of, any
provision of the Certificate of Trust or the Trust Agreement, or any law,
rule, regulation, order, writ, judgment, injunction, decree,
determination or award currently in effect having applicability to the
Trust or its property, including regulations issued by an administrative
agency or other governmental authority having supervisory powers over the
Trust,

     (ii) constitutes, or will constitute, a default by the Trust under,
or a breach of, any provision of any loan agreement, mortgage, indenture
or other agreement or instrument to which the Trust is a party or by
which it or any of its property is or may be bound or affected, or

2

 

     (iii) results in or requires the creation of any Lien upon or in
respect of any of the assets of the Trust, except as otherwise expressly
contemplated by the Transaction Documents.

     (e) Legal Proceedings. There is no action, proceeding, suit or
investigation by or before any court, governmental or administrative agency or
arbitrator against or affecting the Trust, or any properties or rights of the
Trust, pending or, to the knowledge of the Trust, threatened, which, in any
case, if decided adversely, would result in a Material Adverse Change with
respect to the Trust, the Certificate or the Notes.

     (f) Valid and Binding Obligations. Each of the Transaction Documents to
which the Trust is a party when executed by the Owner Trustee on behalf of the
Trust, will constitute the legal, valid and binding obligations of the Trust
enforceable against the Trust in accordance with their respective terms, except
as limited by applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting the enforcement of creditors’ rights generally or
general equitable principles (whether in a proceeding at law or in equity) and
except to the extent that rights to indemnity and contribution may be limited
by public policy. The Certificate, when executed, authenticated and delivered
in accordance with the Trust Agreement, will be validly issued and outstanding
and entitled to the benefits of the Trust Agreement and will evidence the
entire beneficial ownership interest in the Trust. The Notes when executed,
authenticated and delivered in accordance with the Indenture, will be entitled
to the benefits of the Indenture and will constitute legal, valid and binding
obligations of the Trust, enforceable in accordance with their terms, except as
limited by applicable bankruptcy, insolvency, reorganization, moratorium and
similar laws affecting the enforcement of creditors’ rights generally or
general equitable principles (whether in a proceeding at law or in equity) and
except to the extent that rights to indemnity and contribution may be limited
by public policy.

     (g) Accuracy of Information. None of the Transaction Documents, nor any
of the Provided Documents, contain any statement of a material fact with
respect to the Trust or the Transaction that was untrue or misleading in any
material respect when made. Since the furnishing of the Provided Documents,
there has been no change, nor any development or event involving a prospective
change known to the Trust, that would render any of the Provided Documents
untrue or misleading in any material respect. There is no fact known to the
Trust which has a material possibility of causing a Material Adverse Change
with respect to the Trust or which has a material possibility of impairing the
value or marketability of the Receivables, taken as a whole, or decreasing the
possibility that amounts due in respect of the Receivables will be collected as
due.

     (h) Compliance With Securities Laws. The offer and sale of the Notes
comply in all material respects with all requirements of law, including all
registration requirements of applicable securities laws. Without limitation of
the foregoing, the Offering Document did not, as of its date, and does not, as
of the date hereof, contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances under which they were
made, not misleading.

3

 

     (i) Transaction Documents. Each of the representations and warranties of
the Trust contained in the Transaction Documents is true and correct in all
material respects and the Trust hereby makes each such representation and
warranty made by it to, and for the benefit of, Financial Security as if the
same were set forth in full herein.

     (j) No Consents. No consent, license, authorization or approval from, or
registration or other action by, and no notice to or filing or declaration
with, any governmental entity or regulatory body, is required for the due
execution, delivery and performance by the Trust of the Transaction Documents
or any other material document or instrument to be delivered thereunder, except
(in each case) such as have been obtained or the failure of which to be
obtained would not be reasonably likely to have a material adverse effect on
the Transaction.

     (k) Compliance With Law, Etc. No practice, procedure or policy employed
or proposed to be employed by the Trust in the conduct of its business violates
any law, regulation, judgment, agreement, order or decree applicable to it
which, if enforced, would result in a Material Adverse Change with respect to
the financial condition of such Person.

     (l) Special Purpose Entity.

     (i) The capital of the Trust is adequate for the business and
undertakings of the Trust.

     (ii) Except as contemplated by the Transaction Documents, the Trust
is not engaged in any business transactions with any AmeriCredit Party,
AFS Funding or any Affiliate of any of them.

     (iii) The Trust’s funds and assets are not, and will not be,
commingled with the funds of any other Person.

     (m) Solvency; Fraudulent Conveyance. The Trust is solvent and will not be
rendered insolvent by the Transaction and, after giving effect to such
Transaction, the Trust will not be left with an unreasonably small amount of
capital with which to engage in its business. The Trust does not intend to
incur, or believe that it has incurred, debts beyond its ability to pay such
debts as they mature. The Trust does not contemplate the commencement of
insolvency, bankruptcy, liquidation or consolidation proceedings or the
appointment of a receiver, liquidator, conservator, trustee or similar official
in respect of the Trust or any of its assets.

     (n) Perfection of Liens and Security Interest. On the Date of Issuance,
the Lien and security interest in favor of the Trust Collateral Agent with
respect to the Collateral will be perfected by the filing of financing
statements on Form UCC-1 in each jurisdiction where such recording or filing is
necessary for the perfection thereof, the delivery of the Receivables Files to
the Custodian, and the establishment of the Collection Account and the Note
Distribution Account in accordance with the provisions of the Transaction
Documents, and no other filings in any jurisdiction or any other

4

 

actions (except as expressly provided herein) are necessary to perfect the
Trust Collateral Agent’s Lien on and security interest in the Collateral as
against any third parties.

     (o) Investment Company Act. The Trust is not an “investment company,” or
an “affiliated person” of, or “promoter” or “principal underwriter” for, an
“investment company,” as such terms are defined in the Investment Company Act.

     (p) Collateral. On the Date of Issuance the Trust will have good and
marketable title to each item of other Trust Property conveyed on such date and
will own each such item free and clear of any Lien (other than Liens
contemplated under the Indenture) or any equity or participation interest of
any other Person.

     (q) Security Interest in Funds and Investments. Assuming the retention of
funds in the Accounts, such funds will be subject to a valid and perfected,
first priority security interest in favor of the Trust Collateral Agent on
behalf of the Indenture Trustee (on behalf of the Noteholders), the
Certificateholder and Financial Security.

     (r) [Reserved].

     (s) [Reserved].

     Section 2.2 Affirmative Covenants of the Trust. The Trust hereby agrees
(to the extent set forth in this Section 2.2) that during the Term of this
Agreement, unless Financial Security shall otherwise expressly consent in
writing:

     (a) Compliance With Agreements and Applicable Laws. The Trust shall
perform each of its obligations under the Transaction Documents and shall
comply with all material requirements of, and the Notes shall be offered and
sold in accordance with, any law, rule, regulation or order applicable to it or
thereto, or that are required in connection with its performance under any of
the Transaction Documents. The Trust will not cause or permit to become
effective any amendment to or modification of any of the Transaction Documents
to which it is a party unless Financial Security shall have previously approved
in writing the substance of such amendment or modification. The Trust shall
not take any action or fail to take any action that would interfere with the
enforcement of any rights under the Transaction Documents.

     (b) Certain Information. The Trust shall keep, or cause to be kept, in
reasonable detail books and records of account of its assets and business,
which shall be furnished to Financial Security upon request. The Trust shall
furnish to Financial Security, simultaneously with the delivery of such
documents to the Indenture Trustee, the Noteholders or the Certificateholder,
as the case may be, copies of all reports, certificates, statements, financial
statements or notices furnished to the Indenture Trustee, the Noteholders or
the Certificateholder, as the case may be, pursuant to the Transaction
Documents (including, but not limited to, copies of any reports submitted to
the Trust by its independent accountants in connection with any examination of
the financial statements of the Trust).

5

 

     (i) Certain Information. Not less than ten days prior to the date
of filing with the IRS of any tax return or amendment thereto, copies of
the proposed form of such return or amendment and, promptly after the
filing or sending thereof, (A) copies of each tax return and amendment
thereto that the Trust files with the IRS and (B) copies of all financial
statements, reports, and registration statements which the Trust files
with, or delivers to, any federal government agency, authority or body
which supervises the issuance of securities by the Trust.

     (ii) Other Information. Promptly upon the request of Financial
Security, copies of all schedules, financial statements or other similar
reports delivered to or by the Trust pursuant to the terms of this
Agreement and the other Transaction Documents and such other data as
Financial Security may reasonably request.

     (iii) a review of the Trust’s performance under the Transaction
Documents during such period has been made under such officer’s
supervision; and

     (iv) to the best of such individual’s knowledge following reasonable
inquiry, no Default or Event of Default has occurred, or if a Default or
Event of Default has occurred, specifying the nature thereof and, if the
Trust has or had a right to cure pursuant to Section 5.1, stating in
reasonable detail the steps, if any, taken or being taken by the Trust to
cure such Default or Event of Default or to otherwise comply with the
terms of the Transaction Document to which such default or Event of
Default relates.

     (c) Access to Records; Discussions with Officers. The Trust shall, upon
the request of Financial Security, permit Financial Security, or its authorized
agent, at the expense of Financial Security, at reasonable times and upon
reasonable prior written notice:

     (i) to inspect such books and records of the Trust as may relate to
the Notes, the Certificate, the Receivables and the other Trust Property,
the obligations of the Trust under the Transaction Documents, the
business of the Trust and the transactions consummated in connection
therewith; and

     (ii) to discuss the affairs, finances and accounts of the Trust with
an appropriate officer of the Trust.

     Such inspections and discussions shall be conducted during normal business
hours and shall not unreasonably disrupt the business of the Trust.

     (d) Notice of Material Events. The Trust shall promptly inform Financial
Security in writing of the occurrence of any of the following:

     (i) the submission of any claim or the initiation of any legal
process, litigation or administrative or judicial investigation against
the Trust in any federal, state or local court or before any arbitration
board, or any such

6

 

proceeding threatened by any governmental agency, which, if
adversely determined, would have a material adverse effect on the
Receivables as a whole, or which, if adversely determined, would have a
material adverse effect upon the ability of the Trust to perform its
obligations under any Transaction Document;

     (ii) any change in the location of the Trust’s principal office or
any change in the location of the books and records of the Trust;

     (iii) the occurrence of any Default or Special Event; or

     (iv) any other event, circumstance or condition that has resulted,
or which is reasonably likely to result, in a Material Adverse Change in
respect of the Trust.

     (e) Further Assurances. The Trust will file all necessary financing
statements, assignments or other instruments, and any amendments or
continuation statements relating thereto, necessary to be kept and filed in
such manner and in such places as may be required by law to preserve and
protect fully the Lien on and security interest in, and all rights of the Trust
Collateral Agent with respect to the Collateral under the Indenture. In
addition, the Trust shall, upon the request of Financial Security, from time to
time, execute, acknowledge and deliver, or cause to be executed, acknowledged
and delivered, within thirty (30) days of such request, such amendments hereto
and such further instruments and take such further action as may be reasonably
necessary to effectuate the intention, performance and provisions of the
Transaction Documents or to protect the interest of the Trust Collateral Agent
in the Collateral under the Indenture. In addition, the Trust agrees to
cooperate with S&P, Fitch and Moody’s in connection with any review of the
Transaction which may be undertaken by S&P, Fitch and Moody’s after the date
hereof.

     (f) Retirement of Notes. The Trust shall, upon retirement of the Notes,
furnish to Financial Security a notice of such retirement, and, upon such
retirement and the expiration of the Term Of The Policy, surrender the Policy
to Financial Security for cancellation.

     (g) Third-Party Beneficiary. The Trust agrees that Financial Security
shall have all rights of a third-party beneficiary in respect of the Sale and
Servicing Agreement and hereby incorporates and restates its representations,
warranties and covenants as set forth therein for the benefit of Financial
Security.

     (h) Preservation of Existence. The Trust shall observe in all material
respects all procedures required by its Certificate of Trust and Trust
Agreement and preserve and maintain its existence as a trust and its rights,
franchises and privileges in the jurisdiction of its organization, and shall
qualify and remain qualified in good standing in each jurisdiction where the
nature of its business requires it to do so except where the failure to be so
qualified, in good standing and to maintain its rights, franchises and
privileges would not have a material adverse effect on the financial condition
of the Trust, or its

7

 

ability to perform its obligations under this Agreement or under any other
Transaction Document to which it is party.

     (i) Disclosure Document. Each Offering Document delivered with respect to
the Notes shall clearly disclose that the Policy is not covered by the
property/casualty insurance security fund specified in Article 76 of the New
York Insurance Law. In addition, each Offering Document delivered with respect
to the Notes which includes financial statements of Financial Security prepared
in accordance with generally accepted accounting principles (but excluding any
Offering Document in which such financial statements are incorporated by
reference) shall include the following statement immediately preceding such
financial statements:

The New York State Insurance Department recognizes
only statutory accounting practices for determining and
reporting the financial condition and results of
operations of an insurance company, for determining its
solvency under the New York Insurance Law, and for
determining where its financial condition warrants the
payment of a dividend to its stockholders. No
consideration is given by the New York State Insurance
Department to financial statements prepared in accordance
with generally accepted accounting principles in making
such determinations.

     (j) Special Purpose Entity.

     (i) The Trust shall conduct its business solely in its own name
through its duly authorized officers or agents so as not to mislead
others as to the identity of the entity with which those others are
concerned, and particularly will use its best efforts to avoid the
appearance of conducting business on behalf of AmeriCredit, the Company,
AFS Funding, Funding Trust or any other Affiliates thereof or that the
assets of the Trust are available to pay the creditors of AmeriCredit,
the Company, AFS Funding, Funding Trust or any other Affiliates thereof.
Without limiting the generality of the foregoing, all oral and written
communications, including, without limitation, letters, invoices,
purchase orders, contracts, statements and loan applications, will be
made solely in the name of the Trust.

     (ii) The Trust shall maintain trust records and books of account
separate from those of AmeriCredit, the Company, AFS Funding, Funding
Trust and Affiliates of any of them.

     (iii) The Trust shall obtain proper authorization from its equity
owners of all trust action requiring such authorization, and copies of
each such authorization and the minutes or other written summary of each
such meeting shall be delivered to Financial Security within two weeks of
such authorization or meeting as the case may be.

8

 

     (iv) Although the organizational expenses of the Trust have been
paid by AmeriCredit, operating expenses and liabilities of the Trust
shall be paid from its own funds or by AmeriCredit.

     (v) The annual financial statements of the Trust shall disclose the
effects of the Trust’s transactions in accordance with generally accepted
accounting principles and shall disclose that the assets of the Trust are
not available to pay creditors of AmeriCredit, the Company, AFS Funding,
Funding Trust or any Affiliate of any of them.

     (vi) The resolutions, agreements and other instruments of the Trust
underlying the transactions described in this Agreement and in the other
Transaction Documents shall be continuously maintained by the Trust as
official records of the Trust separately identified and held apart from
the records of AmeriCredit, the Company, AFS Funding, Funding Trust and
each Affiliate of any of them.

     (vii) The Trust shall maintain an arm’s-length relationship with
AmeriCredit, the Company, AFS Funding, Funding Trust and each Affiliate
of any of them and will not hold itself out as being liable for the debts
of any such Person.

     (viii) The Trust shall keep its assets and its liabilities wholly
separate from those of all other entities, including, but not limited to,
the Representative, the Company, AFS Funding, Funding Trust and each
Affiliate of any of them except, in each case, as contemplated by the
Transaction Documents.

     (k) Tax Matters. The Trust will take, or refrain from taking, as the case
may be, all actions necessary to ensure that for federal and state income tax
purposes the Trust is not taxable as an association (or publicly traded
partnership) taxable as a corporation.

     (l) Securities Laws. The Trust shall comply in all material respects with
all applicable provisions of state and federal securities laws, including blue
sky laws and the Securities Act, the Exchange Act and the Investment Company
Act and all rules and regulations promulgated thereunder for which
non-compliance would result in a Material Adverse Change with respect to the
Trust.

     (m) Incorporation of Covenants. The Trust shall comply with each of the
Trust’s covenants set forth in the Transaction Documents and hereby
incorporates such covenants by reference as if each were set forth herein.

     Section 2.3 Negative Covenants of the Depositor on Behalf of the Trust.
Funding Trust as Depositor, on behalf of the Trust, hereby agrees (to the
extent set forth in this Section 2.3), that during the Term of the Agreement,
unless Financial Security shall otherwise expressly consent in writing:

     (a) Restrictions on Liens. The Trust shall not, except as contemplated by
the Transaction Documents, (i) create, incur or suffer to exist, or agree to
create, incur or

9

 

suffer to exist, or consent to cause or permit in the future (upon the
happening of a contingency or otherwise) the creation, incurrence or existence
of any Lien or Restriction on Transferability of the Receivables, or (ii) sign
or file under the Uniform Commercial Code of any jurisdiction any financing
statement which names the Trust as a debtor, or sign any security agreement
authorizing any secured party thereunder to file such financing statement, with
respect to the Receivables.

     (b) Impairment of Rights. The Trust shall not take any action, or fail to
take any action, if such action or failure to take action would be reasonably
likely to (i) interfere with the enforcement of any rights under the
Transaction Documents that are material to the rights, benefits or obligations
of the Indenture Trustee, the Certificateholder, the Noteholders or Financial
Security, (ii) result in a Material Adverse Change in respect of the
Receivables, or (iii) impair the ability of the Trust to perform its
obligations under the Transaction Documents.

     (c) Waiver, Amendments, Etc. The Trust shall not waive, modify or amend,
or consent to any waiver, modification or amendment of, any of the provisions
of any of the Transaction Documents.

     (d) Successors. The Trust shall not terminate or designate, or consent to
the termination or designation of, the Servicer, Back-up Servicer, the
Collateral Agent, the Owner Trustee or any successor thereto without the prior
approval of Financial Security.

     (e) Creation of Indebtedness; Guarantees. Other than the Transaction
Documents, the Trust shall not create, incur, assume or suffer to exist any
indebtedness other than indebtedness guaranteed or approved in writing by
Financial Security. Without the prior written consent in writing of Financial
Security, the Trust shall not assume, guarantee, endorse or otherwise be or
become directly or contingently liable for the obligations of any Person by,
among other things, agreeing to purchase any obligation of another Person,
agreeing to advance funds to such Person or causing or assisting such Person to
maintain any amount of capital.

     (f) Subsidiaries. The Trust shall not form, or cause to be formed, any
Subsidiaries.

     (g) No Mergers. The Trust shall not consolidate with or merge into any
Person or transfer all or any material amount of its assets to any Person,
liquidate or dissolve except as permitted by the Trust Agreement and as
contemplated by the Transaction Documents.

     (h) Other Activities. The Trust shall not:

     (i) sell, pledge, transfer, exchange or otherwise dispose of any of
its assets except as permitted under the Transaction Documents; or

     (ii) engage in any business or activity except as contemplated by
the Transaction Documents and as permitted by the Trust Agreement.

10

 

     (i) Insolvency. The Trust shall not commence any case, proceeding or
other action (A) under any existing or future law of any jurisdiction, domestic
or foreign, relating to the bankruptcy, insolvency, reorganization or relief of
debtors, seeking to have an order for relief entered with respect to it, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, corporation or other relief or (B) seeking appointment of a
receiver, trustee, custodian or other similar official for it or for all or any
substantial part of its assets or make a general assignment for the benefit of
its creditors. The Trust shall not take any action in furtherance of, or
indicating the consent to, approval of, or acquiescence in, any of the acts set
forth above. The Trust shall not admit in writing its inability to pay its
debts.

     (j) [Reserved].

     (k) [Reserved].

     Section 2.4 [Reserved].

     (a) [Reserved].

     (b) [Reserved].

     (c) [Reserved].

     (d) [Reserved].

     (e) [Reserved].

     (f) [Reserved].

     (g) [Reserved].

     (h) [Reserved].

     (i) [Reserved].

     (j) [Reserved].

     Section 2.5 [Reserved].

     (a) [Reserved].

     (b) [Reserved].

     (c) [Reserved].

     (d) [Reserved].

11

 

     (e) [Reserved].

     (f) [Reserved].

     (g) [Reserved].

     (h) [Reserved].

     Section 2.6 [Reserved].

     Section 2.7 Representations and Warranties with Respect to Funding Trust
and the Company. Each AmeriCredit Party represents, warrants and covenants, as
of the Date of Issuance, with respect to Funding Trust and the Company, as
follows:

     (a) Due Organization and Qualification. Funding Trust is duly formed and
validly existing as a Delaware statutory trust and is in good standing under
the laws of the State of Delaware and the Company is a corporation, duly
organized, validly existing and in good standing under the laws of Delaware.
Each of Funding Trust and the Company is duly qualified to do business, is in
good standing and has obtained all necessary licenses, permits, charters,
registrations and approvals (together, “approvals”) necessary for the conduct
of its business as currently conducted and as described in the Offering
Document and the performance of its obligations under the Transaction
Documents, in each jurisdiction in which the failure to be so qualified or to
obtain such approvals would render any Receivable unenforceable in any respect
or would otherwise have a material adverse effect upon the Transaction.

     (b) Power and Authority. Each of Funding Trust and the Company has all
necessary trust power and corporate power, respectively and authority to
conduct its business as currently conducted and as described in the Offering
Document, to execute, deliver and perform its obligations under the Transaction
Documents and has full power and authority to sell and assign the Receivables
as contemplated by the Transaction Documents and to consummate the Transaction.

     (c) Due Authorization. The execution, delivery and performance of the
Transaction Documents by each of Funding Trust and the Company have been duly
authorized by all necessary trust action and corporate action, respectively and
do not require any additional approvals or consents or other action by, or any
notice to, or filing with, any Person, including, without limitation, any
governmental entity or the Company’s stockholder.

     (d) Noncontravention. None of the execution and delivery of the
Transaction Documents by the Company or by Funding Trust, the consummation of
the transactions contemplated thereby nor the satisfaction of the terms and
conditions of the Transaction Documents,

     (i) conflicts with or results in any breach or violation of any
provision of the Certificate of Incorporation or Bylaws of the Company or
the Certificate of Trust or the Funding Trust Agreement of Funding Trust,
as the case may be, or

12

 

any law, rule, regulation, order, writ, judgment, injunction,
decree, determination or award currently in effect having applicability
to the Company or Funding Trust, as the case may be, or any of their
respective properties, including regulations issued by an administrative
agency or other governmental authority having supervisory powers over the
Company or Funding Trust, as the case may be,

     (ii) constitutes or will constitute a default by the Company or
Funding Trust, as the case may be, under or a breach of any provision of
any loan agreement, mortgage, indenture or other agreement or instrument
to which the Company or Funding Trust is a party or by which it, or any
of its or their properties is, or may be, bound or affected, or

     (iii) results in or requires the creation of any Lien upon or in
respect of any of the assets of the Company or Funding Trust except as
otherwise expressly contemplated by the Transaction Documents.

     (e) Legal Proceedings. There is no action, proceeding or investigation
pending, or to the best knowledge of the Company or Funding Trust after
reasonable inquiry, threatened by or before any court, regulatory body,
governmental or administrative agency or arbitrator against or affecting the
Company or Funding Trust, or any properties or rights of the Company or Funding
Trust, including without limitation, the Receivables, which might result in a
Material Adverse Change with respect to the Company, Funding Trust or the
Certificate.

     (f) Valid and Binding Obligations. Each of the Transaction Documents to
which either the Company or Funding Trust is a party when executed and
delivered by the Company or Funding Trust, as the case may be, will constitute
the legal, valid and binding obligations of such Person, enforceable in
accordance with their respective terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors’ rights generally and general equitable principles.
The Certificate, when executed, authenticated and delivered in accordance with
the Trust Agreement, will be validly issued and outstanding and entitled to the
benefits of the Trust Agreement and will evidence the entire beneficial
ownership interest in the Trust. The Notes when executed, authenticated and
delivered in accordance with the Indenture, will be entitled to the benefits of
the Indenture and will constitute legal, valid and binding obligations of the
Trust, enforceable in accordance with their terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting the enforcement of creditors’ rights generally or general equitable
principles (whether in a proceeding at law or in equity) and except to the
extent that rights to indemnity and contribution may be limited by public
policy.

     (g) ERISA. Each of Funding Trust and the Company is in compliance with
ERISA and has not incurred and does not reasonably expect to incur, any
liabilities to the PBGC under ERISA in connection with any Plan or
Multiemployer Plan.

13

 

     (h) Accuracy of Information. None of the Transaction Documents nor any of
the Provided Documents contain any statement of a material fact with respect to
the Company or Funding Trust or the Transaction that was untrue or misleading
in any material respect when made. Since the furnishing of the Provided
Documents, there has been no change, nor any development or event involving a
prospective change known to the Company or to Funding Trust, that would render
any of the Provided Documents untrue or misleading in any material respect.
There is no fact known to the Company or Funding Trust which has a material
possibility of causing a Material Adverse Change with respect to either of the
Company or Funding Trust, or which has a material possibility of impairing the
value or marketability of the Receivables, taken as a whole, or decreasing the
possibility that amounts due in respect of the Receivables will be collected as
due.

     (i) Compliance With Securities Laws. The offer and sale of the Securities
comply in all material respects with all requirements of law, including all
registration requirements of applicable securities laws. Without limitation of
the foregoing, the Offering Document does not contain any untrue statement of a
material fact and does not omit to state a material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances under which they were made, not misleading.

     (j) Transaction Documents. Each of the representations and warranties of
Funding Trust and the Company contained in the Transaction Documents is true
and correct in all material respects and each of Funding Trust and the Company
hereby makes each such representation and warranty made by it to, and for the
benefit of, Financial Security as if the same were set forth in full herein.

     (k) No Consents. No consent, license, approval or authorization from, or
registration, filing or declaration with, any regulatory body, administrative
agency, or other governmental instrumentality, nor any consent, approval,
waiver or notification of any creditor, lessor or other nongovernmental person,
is required in connection with the execution, delivery and performance by the
Company or Funding Trust of this Agreement or of any other Transaction Document
to which such Person is a party, except (in each case) such as have been
obtained and are in full force and effect.

     (l) Compliance With Law, Etc. No practice, procedure or policy employed
or proposed to be employed by the Company or Funding Trust in the conduct of
their respective businesses violates any law, regulation, judgment, agreement,
order or decree applicable to it which, if enforced, would result in a Material
Adverse Change with respect to such Person.

     (m) Special Purpose Entity.

     (i) The capital of Funding Trust is adequate for the business and
undertakings of Funding Trust.

14

 

     (ii) Other than with respect to the purchase by the Company of the
stock of AFS Funding, which owns all the stock of Funding Trust, with
respect to matters covered in the Administration Agreement and as
provided in this Agreement, the Transaction Documents and documents
entered into with respect to the Other Transactions, Funding Trust is not
engaged in any business transactions with the Company.

     (iii) [Reserved].

     (iv) The funds and assets of Funding Trust are not, and will not be,
commingled with the funds of any other person.

     (v) [Reserved].

     (n) Solvency; Fraudulent Conveyance. Each of Funding Trust and the
Company is solvent and will not be rendered insolvent by the Transaction and,
after giving effect to such Transaction, neither the Company nor Funding Trust
will be left with an unreasonably small amount of capital with which to engage
in its business. Neither the Company nor Funding Trust intends to incur, or
believes that it has incurred, debts beyond its ability to pay such debts as
they mature. Neither the Company nor Funding Trust contemplates the
commencement of insolvency, bankruptcy, liquidation or consolidation
proceedings or the appointment of a receiver, liquidator, conservator, trustee
or similar official in respect of the Company or Funding Trust, as the case may
be, or any of their respective assets. The amount of consideration being
received by the Seller upon the sale of the Receivables to the Trust
constitutes reasonably equivalent value and fair consideration for the
Receivables. The Seller is not selling the Receivables to the Trust, as
provided in the Transaction Documents, with any intent to hinder, deal or
defraud any of the Company’s creditors.

     (o) Good Title; Valid Transfer; Absence of Liens; Security Interest.

     (i) Immediately prior to the pledge of the Collateral to the Trust
Collateral Agent pursuant to the Indenture, the Trust was the owner of,
and had good and marketable title to, such property free and clear of all
Liens and Restrictions on Transferability, and had or will have had full
right, power and lawful authority to assign, transfer and pledge such
Receivables. The Indenture constitutes a valid pledge of the Collateral
to the Trust Collateral Agent and the Trust Collateral Agent shall have a
valid and perfected first priority security interest in the Collateral,
free and clear of all Liens and Restrictions on Transferability.

     (ii) Immediately prior to the transfer of any Receivables to the
Trust pursuant to the Sale and Servicing Agreement, Funding Trust was or
will have been the owner of, and had good and marketable title to, such
property free and clear of all Liens and Restrictions on Transferability,
and had or will have had full right, corporate power and lawful authority
to assign, transfer and pledge such Receivables. In the event that a
transfer of the Receivables by Funding Trust to

15

 

the Trust is characterized as other than a sale, such transfer shall
be characterized as a secured financing, and the Trustee shall have a
valid and perfected first priority security interest in such Receivables
free and clear of all Liens and Restrictions on Transferability.

     (iii) Immediately prior to the sale of the Receivables to Funding
Trust pursuant to the Purchase Agreement, the Company was or will have
been the owner of, and had good and marketable title to, the Receivables
being transferred by such party free and clear of all Liens and
Restrictions on Transferability, and had or will have had full right,
corporate power and lawful authority to assign, transfer and pledge such
Receivables. In the event that a transfer of the Receivables by the
Company to Funding Trust is characterized as other than a sale, such
transfer shall be characterized as a secured financing, and Funding Trust
shall have a valid and perfected first priority security interest in such
Receivables free and clear of all Liens and Restrictions on
Transferability.

     (p) [Reserved].

     (q) Taxes. The Company has filed all federal and state tax returns which
are required to be filed and paid all taxes, including any assessments received
by the Company, to the extent that such taxes have become due. Any taxes, fees
and other governmental charges payable by the Company or Funding Trust in
connection with the Transaction, the execution and delivery of the Transaction
Documents and the issuance of the Securities have been paid or shall have been
paid at or prior to the Date of Issuance.

     (r) Security Interest in Funds and Investments in the Spread Account.
Assuming the retention of funds in the Spread Account, such funds will be
subject to a valid and perfected, first priority security interest in favor of
the Collateral Agent on behalf of the Indenture Trustee (on behalf of the
Noteholders), the Certificateholder and Financial Security.

     (s) [Reserved].

     (t) [Reserved].

     Section 2.8 Affirmative Covenants with Respect to the Company and Funding
Trust. Each AmeriCredit Party hereby agrees with respect to the Company and
with respect to Funding Trust that during the Term of this Agreement, unless
Financial Security shall otherwise expressly consent in writing:

     (a) Compliance With Agreements and Applicable Laws. Each of Funding Trust
and the Company shall perform each of its respective obligations under the
Transaction Documents and shall comply with all material requirements of any
law, rule or regulation applicable to it, or that are required in connection
with its performance under any of the Transaction Documents. Neither the
Company nor Funding Trust will cause or permit to become effective any
amendment to or modification of any of the Transaction Documents to which it is
a party unless Financial Security shall have

16

 

previously approved in writing the form of such amendment or modification.
Neither the Company nor Funding Trust shall take any action or fail to take
any action that would interfere with the enforcement of any rights under the
Transaction Documents.

     (b) Reports; Other Information. Each of Funding Trust and the Company
shall keep or cause to be kept in reasonable detail books and records of
account of their respective assets and business. Each of Funding Trust and the
Company shall furnish or caused to be furnished to Financial Security:

     (i) Promptly upon receipt thereof, copies of all reports,
statements, certifications, schedules, or other similar items delivered
to or by the Company or Funding Trust pursuant to the terms of the
Transaction Documents and, promptly upon request, such other data as
Financial Security may reasonably request; provided, however, that
neither the Company nor Funding Trust shall be required to deliver any
such items if provision by some other party to Financial Security is
required under the Transaction Documents unless such other party
wrongfully fails to deliver such item. The Company and Funding Trust
shall, upon the request of Financial Security, permit Financial Security
or its authorized agents (A) to inspect its books and records as they may
relate to the Securities, the Receivables, the Certificate, the
obligations of Funding Trust and the Company under the Transaction
Documents, the Transaction and, but only following the occurrence of a
Special Event, Funding Trust’s business; (B) to discuss the affairs,
finances and accounts of Funding Trust and the Company with an officer of
each upon Financial Security’s reasonable request; and (C) upon the
occurrence of a Special Event, to discuss the affairs, finances and
accounts of Funding Trust and the Company with its independent
accountants, provided that an officer of such Person shall have the right
to be present during such discussions. Such inspections and discussions
shall be conducted during normal business hours and shall not
unreasonably disrupt the business of such Person. The fees and expenses
of Financial Security or any such authorized agents shall be for the
account of AmeriCredit.

     (ii) The Company shall provide or cause to be provided to Financial
Security an executed original copy of each document executed in
connection with the transaction within 30 days after the date of closing.

     (c) Notice of Material Events. The Company and Funding Trust shall
promptly inform Financial Security in writing of the occurrence of any of the
following:

     (i) the submission of any claim or the initiation of any legal
process, litigation or administrative or judicial investigation (A)
against the Company or Funding Trust pertaining to the Receivables in
general, (B) with respect to a material portion of the Receivables, or
(C) in which a request has been made for certification as a class action
(or equivalent relief) that would involve a material portion of the
Receivables;

17

 

     (ii) any change in the location of the principal office of either of
the Company or Funding Trust or any change in the location of the books
and records of the Company or Funding Trust;

     (iii) the occurrence of any Default or Special Event; or

     (iv) any other event, circumstance or condition that has resulted,
or which the Company or Funding Trust, as the case may be, reasonably
believes might result, in a Material Adverse Change in respect of the
Company or Funding Trust.

     (d) Further Assurances. Each of Funding Trust and the Company will file
all necessary financing statements, assignments or other instruments, and any
amendments or continuation statements relating thereto, necessary to be kept
and filed in such manner and in such places as may be required by law to
preserve and protect fully the Lien on and security interest in, and all rights
of the Trust Collateral Agent, for the benefit of the Trust Collateral Agent
(for the Certificateholder and Financial Security), with respect to the
Receivables, the Collection Account and the Spread Account. In addition, each
of Funding Trust and the Company shall, upon the request of Financial Security,
from time to time, execute, acknowledge and deliver, or cause to be executed,
acknowledged and delivered, within thirty (30) days of such request, such
amendments hereto and such further instruments and take such further action as
may be reasonably necessary to effectuate the intention, performance and
provisions of the Transaction Documents or to protect the interest of the
Trust, the Owner Trustee, the Indenture Trustee and Financial Security, in the
Receivables, the Collection Account and the Spread Account, free and clear of
all Liens and Restrictions on Transferability except as contemplated by the
Transaction Documents. In addition, each of Funding Trust and the Company
agrees to cooperate with S&P, Fitch and Moody’s in connection with any review
of the Transaction which may be undertaken by S&P, Fitch and Moody’s after the
date hereof.

     (e) Third-Party Beneficiary. Each of Funding Trust and the Company agrees
that Financial Security shall have all rights of a third-party beneficiary in
respect of the Sale and Servicing Agreement and hereby incorporates and
restates its representations, warranties and covenants as set forth therein for
the benefit of Financial Security.

     (f) Existence. Funding Trust shall maintain its existence and the Company
shall maintain its corporate existence and shall at all times continue to be
duly organized under the laws of Delaware, and duly qualified and duly
authorized (as described in Sections 2.7(a), (b) and (c) hereof) and shall
conduct its business in accordance with the terms of its Certificate of Trust
and its Funding Trust Agreement (with respect to Funding Trust) or its
Certificate of Incorporation and Bylaws (with respect to the Company).

     (g) Disclosure Document. Each Offering Document delivered with respect to
the Securities shall clearly disclose that the Policy is not covered by the
property/casualty insurance security fund specified in Article 76 of the New
York Insurance Law. In addition, each Offering Document delivered with respect
to the Securities which includes financial statements of Financial Security
prepared in accordance with generally accepted

18

 

accounting principles (but excluding any Offering Document in which such
financial statements are incorporated by reference) shall include the following
statement immediately preceding such financial statements:

The New York State Insurance Department recognizes
only statutory accounting practices for determining and
reporting the financial condition and results of
operations of an insurance company, for determining its
solvency under the New York Insurance Law, and for
determining where its financial condition warrants the
payment of a dividend to its stockholders. No
consideration is given by the New York State Insurance
Department to financial statements prepared in accordance
with generally accepted accounting principles in making
such determinations.

     (h) Special Purpose Entity.

     (i) Funding Trust shall conduct its business solely in its own name
through its duly authorized agents (including but not limited to the
Administrator) so as not to mislead others as to the identity of the
entity with which those others are concerned, and particularly will use
its best efforts to avoid the appearance of conducting business on behalf
of any affiliate thereof or that the assets of Funding Trust are
available to pay the creditors of the Company, AFS Funding or AmeriCredit
or any affiliate thereof. Without limiting the generality of the
foregoing, all oral and written communications, including, without
limitation, letters, invoices, purchase orders, contracts, statements and
loan applications, will be made solely in the name of Funding Trust.

     (ii) Funding Trust shall maintain trust records and books of account
separate from those of the Company, AFS Funding, the Trust and
AmeriCredit, and the affiliates thereof.

     (iii) Funding Trust shall obtain proper authorization from its
equity owners of all trust action requiring such authorization, and
copies of each such authorization and the minutes or other written
summary of each such meeting shall be delivered to Financial Security
within two weeks of such authorization or meeting as the case may be.

     (iv) [Reserved].

     (v) Although the organizational expenses of Funding Trust have been
paid by AmeriCredit, Funding Trust shall pay its own operating expenses
and liabilities from its own funds.

     (vi) The annual financial statements of Funding Trust shall disclose
the effects of Funding Trust’s transactions in accordance with generally
accepted accounting principles and shall disclose that the assets of
Funding Trust are not

19

 

available to pay creditors of AmeriCredit, AFS Funding, the Trust or
the Company or any Affiliate thereof.

     (vii) The agreements and other instruments of Funding Trust
underlying the transactions described in this Agreement and in the other
Transaction Documents shall be continuously maintained by Funding Trust
as official records of Funding Trust, separately identified and held
apart from the records of AmeriCredit, AFS Funding, the Trust and the
Company and each Affiliate thereof.

     (viii) Funding Trust shall maintain an arm’s-length relationship
with AmeriCredit, AFS Funding, the Trust and the Company and the
affiliates thereof, and will not hold itself out as being liable for the
debts of AmeriCredit or the Company or any affiliate thereof.

     (ix) Funding Trust shall keep its assets and liabilities wholly
separate from those of all other entities, including, but not limited to,
the Representative, AFS Funding, AmeriCredit, the Trust and the Company
and each Affiliate of them except, in each case, as contemplated by the
Transaction Documents.

     (x) [Reserved].

     (i) Maintenance of Licenses. Each of Funding Trust and the Company shall
maintain all licenses, permits, charters and registrations which are material
to the performance by it of its obligations under this Agreement and each other
Transaction Document to which it is a party or by which it is bound.

     (j) Release of Liens. The Company shall duly file on behalf of JPMorgan
Chase Bank no later than the first Business Day immediately following the
Closing Date, the amendments to, and/or terminations of, UCC financing
statements evidencing the Release of Security Interests.

     Section 2.9 Negative Covenants with Respect to Funding Trust and the
Company. Each AmeriCredit Party hereby agrees with respect to Funding Trust
and with respect to the Company that during the Term of this Agreement, unless
Financial Security shall otherwise expressly consent in writing:

     (a) Restrictions on Liens. Neither Funding Trust nor the Company shall,
except as contemplated by the Transaction Documents, (i) create, incur or
suffer to exist, or agree to create, incur or suffer to exist, or consent to
cause or permit in the future (upon the happening of a contingency or
otherwise) the creation, incurrence or existence of any Lien or Restriction on
Transferability of the Receivables, or (ii) sign or file under the Uniform
Commercial Code of any jurisdiction any financing statement which names the
Company or Funding Trust as a debtor, or sign any security agreement
authorizing any secured party thereunder to file such financing statement, with
respect to the Receivables.

20

 

     (b) Impairment of Rights. Neither Funding Trust nor the Company shall
take any action, or fail to take any action, if such action or failure to take
action may (i) interfere with the enforcement of any rights under the
Transaction Documents that are material to the rights, benefits or obligations
of the Indenture Trustee, the Certificateholder, the Noteholders or Financial
Security, (ii) result in a Material Adverse Change in respect of the
Receivables, or (iii) impair the ability of the Company or Funding Trust to
perform their respective obligations under the Transaction Documents, including
any consolidation, merger with any Person or any transfer of all or any
material amount of the assets of the Company or Funding Trust to any other
Person if such consolidation, merger or transfer would materially impair the
net worth of the Company or Funding Trust or any successor Person obligated,
after such event, to perform such Person’s obligations under the Transaction
Documents.

     (c) Waiver, Amendments, Etc. Neither Funding Trust nor the Company shall
waive, modify or amend, or consent to any waiver, modification or amendment of,
any of the provisions of any of the Transaction Documents.

     (d) Successors. Neither Funding Trust nor the Company shall terminate or
designate, or consent to the termination or designation of, the Servicer,
Back-up Servicer, Collateral Agent, the Owner Trustee or any successor thereto
without the prior approval of Financial Security.

     (e) Creation of Indebtedness; Guarantees. Funding Trust shall not create,
incur, assume or suffer to exist any indebtedness other than indebtedness
guaranteed or approved in writing by Financial Security other than the
Transaction Documents. Without the prior written consent of Financial
Security, the Trustee and Funding Trust shall not assume, guarantee, endorse or
otherwise be or become directly or contingently liable for the obligations of
any Person by, among other things, agreeing to purchase any obligation of
another Person, agreeing to advance funds to such Person or causing or
assisting such Person to maintain any amount of capital.

     (f) Subsidiaries. Funding Trust shall not form, or cause to be formed,
any Subsidiaries.

     (g) [Reserved].

     (h) No Mergers. Funding Trust shall not consolidate with or merge into
any Person or transfer all or any material amount of its assets to any Person
or liquidate or dissolve except as permitted by the Funding Trust Agreement and
as contemplated by the Transaction Documents.

     (i) Other Activities. Funding Trust shall not:

     (i) sell, pledge, transfer, exchange or otherwise dispose of any of
its assets except as permitted under the Transaction Documents; or

21

 

     (ii) engage in any business or activity other than in connection
with the Transaction Documents, documents entered into with respect to
the Other Transactions and as permitted by its certificate of
incorporation.

     (j) Insolvency. No AmeriCredit Party shall commence with respect to the
Company or Funding Trust, as the case may be, any case, proceeding or other
action (A) under any existing or future law of any jurisdiction, domestic or
foreign, relating to the bankruptcy, insolvency, reorganization or relief of
debtors, seeking to have an order for relief entered with respect to it, or
seeking reorganization, arrangement, adjustment, winding-up, liquidation,
dissolution, corporation or other relief with respect to it or (B) seeking
appointment of a receiver, trustee, custodian or other similar official for it
or for all or any substantial part of its assets, or make a general assignment
for the benefit of its creditors. No AmeriCredit Party shall take any action
in furtherance of, or indicating the consent to, approval of, or acquiescence
in any of the acts set forth above. Neither Funding Trust nor the Company
shall admit in writing its inability to pay its debts.

     Section 2.10 Representations and Warranties of AmeriCredit. AmeriCredit
represents, warrants and covenants, as of the date hereof and as of the Date of
Issuance, as follows:

     (a) Due Organization and Qualification. AmeriCredit is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Texas, with power and authority to own its properties and conduct its business.
AmeriCredit is duly qualified to do business, is in good standing and has
obtained all necessary licenses, permits, charters, registrations and approvals
(together, “approvals”) necessary for the conduct of its business as currently
conducted and the performance of its obligations under the Transaction
Documents, in each jurisdiction in which the failure to be so qualified or to
obtain such approvals would render any Transaction Document unenforceable in
any respect or would otherwise have a material adverse effect upon the
Transaction.

     (b) Power and Authority. AmeriCredit has all necessary corporate power
and authority to conduct its business as currently conducted, to execute,
deliver and perform its obligations under this Agreement and each other
Transaction Document to which it is a party and to carry out the terms of each
such Document and has full power and authority to consummate the Transaction.

     (c) Due Authorization. The execution, delivery and performance by
AmeriCredit of this Agreement and each other Transaction Document to which it
is a party have been duly authorized by all necessary corporate action and do
not require any additional approvals or consents or other action by or any
notice to or filing with any Person, including, without limitation, any
governmental entity or the stockholders of such Person.

     (d) Noncontravention. Neither the execution nor delivery of this
Agreement and each other Transaction Document to which AmeriCredit is a party,
nor the

22

 

consummation of the Transaction nor the satisfaction of the terms and
conditions of this Agreement and each other Transaction Document to which
AmeriCredit is a party,

     (i) conflicts with or results, or will conflict with or result, in
any breach or violation of any provision of the Certificate of
Incorporation or Bylaws of AmeriCredit or any law, rule, regulation,
order, writ, judgment, injunction, decree, determination or award
currently in effect having applicability to AmeriCredit, or any of its
properties, including regulations issued by an administrative agency or
other governmental authority having supervisory powers over AmeriCredit,

     (ii) constitutes or will constitute a default by AmeriCredit under,
or a breach of any provision of, any loan agreement, mortgage, indenture
or other agreement or instrument to which AmeriCredit or any of its
Subsidiaries is a party or by which it or any of its or their properties
is or may be bound or affected, or

     (iii) results in or requires, or will result in or require, the
creation of any Lien upon, or in respect of, any of the assets of
AmeriCredit or any of its Subsidiaries except as otherwise expressly
contemplated by the Transaction Documents.

     (e) Legal Proceedings. There is no action, proceeding or investigation
pending, or to the best knowledge of AmeriCredit after reasonable inquiry,
threatened by or before any court, regulatory body, governmental or
administrative agency or arbitrator against or affecting AmeriCredit, or any
properties or rights of AmeriCredit which is likely to result in a Material
Adverse Change with respect to AmeriCredit, or which might adversely affect the
federal or state tax attributes of the Securities.

     (f) Valid and Binding Obligations. Each of the Transaction Documents to
which AmeriCredit is a party, when executed and delivered by it, and assuming
due authorization, execution and delivery by the other parties thereto, will
constitute the legal, valid and binding obligations of AmeriCredit, enforceable
in accordance with its terms, except as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors’ rights generally and general equitable principles. The
Certificate, when executed, authenticated and delivered in accordance with the
Trust Agreement, will be validly issued and outstanding and entitled to the
benefits of the Trust Agreement and will evidence the entire beneficial
ownership interest in the Trust. The Notes when executed, authenticated and
delivered in accordance with the Indenture, will be entitled to the benefits of
the Indenture and will constitute legal, valid and binding obligations of the
Trust, enforceable in accordance with their terms, except as limited by
applicable bankruptcy, insolvency, reorganization, moratorium and similar laws
affecting the enforcement of creditors’ rights generally or general equitable
principles (whether in a proceeding at law or in equity) and except to the
extent that rights to indemnity and contribution may be limited by public
policy.

     (g) Financial Statements. The Financial Statements of AmeriCredit, copies
of which have been furnished to Financial Security, (i) are, as of the dates
and for the

23

 

periods referred to therein, complete and correct in all material
respects, (ii) present fairly the financial condition and results of operations
of AmeriCredit as of the dates and for the periods indicated, and (iii) have
been prepared in accordance with generally accepted accounting principles
consistently applied, except as noted therein (subject as to interim statements
to normal year-end adjustments). Since the date of the most recent Financial
Statements, there has been no material adverse change in such financial
condition or results of operations. Except as disclosed in the Financial
Statements, AmeriCredit is not subject to any contingent liabilities or
commitments that, individually or in the aggregate, have a material possibility
of causing a Material Adverse Change in respect of AmeriCredit.

     (h) ERISA. AmeriCredit is in compliance with ERISA and has not incurred
and does not reasonably expect to incur any liabilities to the PBGC under ERISA
in connection with any Plan or Multiemployer Plan.

     (i) Accuracy of Information. None of the Provided Documents contain any
statement of a material fact with respect to AmeriCredit or the Transaction
that was untrue or misleading in any material respect when made (except insofar
as any such Document was connected to, or superseded by, a subsequent Provided
Document). Since the furnishing of the Provided Documents, there has been no
change, or any development or event involving a prospective change known to
AmeriCredit that would render any representation or warranty or other statement
made by it in any of the Provided Documents untrue or misleading in any
material respect. There is no fact known to AmeriCredit which has a material
possibility of causing a Material Adverse Change with respect to it (for
purposes of the foregoing representation and warranty, Material Adverse Change
shall be determined only with respect to AmeriCredit, but not any of its
Subsidiaries individually) or which has a material possibility of impairing the
value or marketability of the Receivables, taken as a whole, or decreasing the
possibility that amounts due in respect of the Receivables will be collected as
due.

     (j) Compliance With Securities Laws. Neither the Trust nor AmeriCredit is
required to be registered as an “investment company” under the Investment
Company Act and the Trust is not subject to the information reporting
requirements of the Securities Exchange Act.

     (k) Transaction Documents. Each of the representations and warranties of
AmeriCredit contained in the Transaction Documents is true and correct in all
material respects and AmeriCredit hereby makes each such representation and
warranty made by it to, and for the benefit of, Financial Security as if the
same were set forth in full herein.

     (l) No Consents. No consent, license, approval or authorization from, or
registration, filing or declaration with, any regulatory body, administrative
agency, or other governmental instrumentality, nor any consent, approval,
waiver or notification of any creditor, lessor or other non-governmental
person, is required in connection with the execution, delivery and performance
by AmeriCredit of this Agreement or of any other Transaction Document to which
it is a party, except (in each case) such as have been obtained and are in full
force and effect.

24

 

     (m) Compliance With Law, Etc. No practice, procedure or policy employed
or proposed to be employed by AmeriCredit in the conduct of its business
violates any law, regulation, judgment, agreement, order or decree applicable
to it which, if enforced, would result in a Material Adverse Change with
respect to AmeriCredit.

     (n) Solvency; Fraudulent Conveyance. AmeriCredit is solvent and will not
be rendered insolvent by the Transaction and, after giving effect to the
Transaction, AmeriCredit will not be left with an unreasonably small amount of
capital with which to engage in its business. AmeriCredit does not intend to
incur, or believe that it has incurred, debts beyond its ability to pay such
debts as they mature. AmeriCredit does not contemplate the commencement of
insolvency, bankruptcy, liquidation or consolidation proceedings or the
appointment of a receiver, liquidator, conservator, trustee or similar official
in respect of AmeriCredit or any of its assets. AmeriCredit is not entering
into the Transaction Documents or consummating the transactions contemplated
thereby with any intent to hinder, delay or defraud any of AmeriCredit’s
creditors.

     (o) Taxes. AmeriCredit has filed all federal and state tax returns which
are required to be filed and paid all taxes, in each case with respect to the
includible group of which AmeriCredit is a member, including any assessments
received by it, to the extent that such taxes have become due other than taxes
that it shall currently be contesting the validity thereof in good faith by
appropriate proceedings and shall have set aside on its books adequate reserves
with respect thereto. Any taxes, fees and other governmental charges payable
by AmeriCredit in connection with the Transaction and the execution and
delivery of the Transaction Documents have been paid or shall have been paid at
or prior to the Date of Issuance.

     (p) [Reserved].

     (q) [Reserved].

     (r) Compliance with Anti-Money Laundering Laws. No practice, procedure or
policy employed or proposed to be employed by AmeriCredit in the conduct of its
business constitutes a material violation of any anti-money laundering law or
regulation (including without limitation, the USA PATRIOT Act, Public Law No.
107-56 (2001), and regulations promulgated thereunder) applicable to
AmeriCredit.

     Section 2.11 Affirmative Covenants of AmeriCredit. AmeriCredit hereby
agrees, during the Term of this Agreement, unless Financial Security shall
otherwise expressly consent in writing, as follows:

     (a) Compliance With Agreements and Applicable Laws. AmeriCredit shall
perform each of its respective obligations under the Transaction Documents and
shall comply with all material requirements of any law, rule or regulation
applicable to it or thereto, or that are required in connection with its
performance under any of the Transaction Documents. AmeriCredit will not cause
or permit to become effective any amendment to or modification of any of the
Transaction Documents to which it is a party

25

 

unless Financial Security shall have previously approved in writing the
form of such amendment or modification. AmeriCredit shall not take any action
or fail to take any action that would interfere with the enforcement of any
rights under the Transaction Documents.

     (b) Financial Statements; Accountants’ Reports; Other Information.
AmeriCredit shall keep, or cause to be kept, in reasonable detail books and
records of account of its assets and business, and shall clearly reflect
therein the transfer of the Receivables to the Trust and the sale of the
Securities to the Underwriters as a sale of Funding Trust’s interest in the
Receivables evidenced by the Securities. AmeriCredit shall deliver to
Financial Security, simultaneously with the delivery of such documents to the
relevant federal or state department or agency copies of all Annual Reports on
Form 10-K, Quarterly Reports on Form 10-Q, and periodic reports on Form 8-K
required to be filed by AmeriCredit with the Commission. AmeriCredit shall
also furnish or cause to be furnished to Financial Security:

     (i) Annual Financial Statements. As soon as available, and in any
event within 120 days after the close of each fiscal year of AmeriCredit,
the audited balance sheets of AmeriCredit as of the end of such fiscal
year and the audited statements of income, shareholders’ equity and cash
flows of AmeriCredit for such fiscal year, all in reasonable detail and
stating in comparative form the respective figures for the corresponding
date and period in the preceding fiscal year, prepared in accordance with
generally accepted accounting principles, consistently applied, and
accompanied by the certificate of independent accountants (which shall be
a nationally recognized firm or otherwise acceptable to Financial
Security) for AmeriCredit and by the certificate specified in Section
2.11(c) hereof.

     (ii) Quarterly Financial Statements. As soon as available, and in
any event within 45 days after the close of the first three quarters of
each fiscal year of AmeriCredit, the unaudited balance sheets of
AmeriCredit as of the end of each such quarter and the unaudited
statements of income and cash flows of AmeriCredit for the portion of the
fiscal year then ended, all in reasonable detail and stating in
comparative form the respective figures for the corresponding date and
period in the preceding fiscal year, prepared in accordance with
generally accepted accounting principles, consistently applied (subject
to normal year-end adjustments), and accompanied by the certificate
specified in Section 2.11(c) hereof if such certificate is required to be
provided pursuant to such Section.

     (iii) Accountants’ Reports. If a Special Event has occurred, upon
the request of Financial Security, the balance sheets of AmeriCredit as
of the end of AmeriCredit’s most recent fiscal year (and the most recent
fiscal half) and the statements of income, shareholders’ equity and cash
flows of AmeriCredit for such fiscal year (and for such half), all in
reasonable detail and stating in comparative form the respective figures
for the corresponding date and period in the preceding fiscal year,
prepared in accordance with generally accepted accounting principles,
consistently applied, and, in the case of financial

26

 

statements as of the end of a fiscal year, audited and accompanied
by the certificate of independent accountants (which shall be a
nationally recognized firm or otherwise acceptable to Financial Security)
for AmeriCredit.

     (iv) Other Information. Promptly upon receipt thereof, copies of
all reports, statements, certifications, schedules, or other similar
items delivered to or by AmeriCredit pursuant to the terms of the
Transaction Documents and, promptly upon request, such other data as
Financial Security may reasonably request; provided, however, that
AmeriCredit shall not be required to deliver any such items if provision
by some other party to Financial Security is required under the
Transaction Documents unless such other party wrongfully fails to deliver
such item. AmeriCredit shall, upon the request of Financial Security,
permit Financial Security or its authorized agents to inspect its books
and records as they may relate to the Securities, the Receivables, the
obligations of AmeriCredit under the Transaction Documents or the
Transaction. Such inspections and discussions shall be conducted during
normal business hours and shall not unreasonably disrupt the business of
AmeriCredit. The fees and expenses of Financial Security or any such
authorized agents shall be for the account of AmeriCredit. In addition,
AmeriCredit shall promptly (but in no case more than 30 days following
issuance or receipt by a Commonly Controlled Entity) provide to Financial
Security a copy of all correspondence between a Commonly Controlled
Entity and the PBGC, IRS, Department of Labor or the administrators of a
Multiemployer Plan relating to any Reportable Event or the underfunded
status, termination or possible termination of a Plan or a Multiemployer
Plan. The books and records of AmeriCredit will be maintained at the
address for it designated herein for receipt of notices, unless it shall
otherwise advise the parties hereto in writing.

     (v) AmeriCredit shall provide, or cause to be provided, to Financial
Security an executed original copy of each document executed in
connection with the Transaction within 30 days after the date of closing.

     (c) Compliance Certificate. AmeriCredit shall deliver to Financial
Security concurrently with the delivery of the financial statements required
pursuant to Section 2.11(b)(i) hereof (and concurrently with the delivery of
the financial statements required pursuant to Section 2.11(b)(ii) hereof, if a
Special Event has occurred), a certificate signed by an officer of AmeriCredit
stating that the attached financial reports submitted in accordance with
Section 2.11(b)(i) or (ii) hereof, as applicable, are complete and correct in
all material respects and present fairly the financial condition and results of
operations of AmeriCredit as of the dates and for the periods indicated, in
accordance with generally accepted accounting principles consistently applied
(subject as to interim statements to normal year-end adjustments).

     (d) Notice of Material Events. AmeriCredit shall promptly inform
Financial Security in writing of the occurrence of any of the following:

27

 

     (i) the submission of any claim or the initiation of any legal
process, litigation or administrative or judicial investigation (A)
against AmeriCredit pertaining to the Receivables in general, (B) with
respect to a material portion of the Receivables, or (C) in which a
request has been made for certification as a class action (or equivalent
relief) that would involve a material portion of the Receivables;

     (ii) any change in the location of AmeriCredit’s principal office or
any change in the location of the books and records of AmeriCredit;

     (iii) the occurrence of any Default or Special Event; or

     (iv) any other event, circumstance or condition that has resulted,
or which AmeriCredit reasonably believes is likely to result, in a
Material Adverse Change in respect of AmeriCredit (for purposes of the
foregoing representation and warranty, Material Adverse Change shall be
determined only with respect to AmeriCredit, but not any of its
Subsidiaries individually).

     (e) Further Assurances. AmeriCredit shall, upon the request of Financial
Security, from time to time, execute, acknowledge and deliver, or cause to be
executed, acknowledged and delivered, within thirty (30) days of such request,
such amendments hereto and such further instruments and take such further
action as may be reasonably necessary to effectuate the intention, performance
and provisions of the Transaction Documents. In addition, AmeriCredit agrees
to cooperate with S&P, Fitch and Moody’s in connection with any review of the
Transaction which may be undertaken by S&P, Fitch and Moody’s after the date
hereof.

     (f) Corporate Existence. AmeriCredit shall maintain its corporate
existence and shall at all times continue to be duly organized under the laws
of the State of Texas and duly qualified and duly authorized (as described in
Sections 2.10(a), (b) and (c) hereof) and shall conduct its business in
accordance with the terms of its Certificate of Incorporation and Bylaws.

     (g) Maintenance of Licenses. AmeriCredit shall maintain all licenses,
permits, charters and registrations which are material to the performance by it
of its obligations under this Agreement and each other Transaction Document to
which is a party or by which it is bound.

     (h) Notice of Merger or Consolidation of Trust. AmeriCredit (i) shall
promptly inform Financial Security in writing of the occurrence of (a) the
Trust consolidating or merging with or into any other Person or (b) the Trust
conveying or transferring all or substantially all of its properties or assets,
including those included in the Trust Estate, to any Person, as set forth in
Section 3.10 of the Indenture; and (ii) shall obtain the necessary consents of
Financial Security to effect such actions.

     (i) For so long as AmeriCredit has any securitization transactions
(including warehouse facilities) outstanding as to which Financial Security has
provided credit enhancements and any of the securitized receivables remain on
AmeriCredit’s

28

 

consolidated balance sheet, AmeriCredit shall include disclosure with
respect to such on-balance sheet securitizations, in (i) any financial
statement provided to a creditor of AmeriCredit and (ii) all financial
statements included as part of its Form 10-Qs and Form 10-Ks subsequently filed
by AmeriCredit with the Commission, in a form substantially as follows:
“AmeriCredit structures its securitization transactions and its warehouse
facilities as secured financings that do not meet the accounting criteria for
sale of finance receivables. Accordingly, following a securitization or the
pledging of receivables to a warehouse facility, the finance receivables are
transferred to special purpose finance subsidiaries of the AmeriCredit and the
related securitization notes payable or warehouse credit, issued by special
purpose finance subsidiaries, remain on the consolidated balance sheet. While
these subsidiaries are included in AmeriCredit ‘s consolidated financial
statements, these subsidiaries are separate legal entities and the finance
receivables and other assets held by them are legally owned by these
subsidiaries, are available to satisfy the related securitization notes payable
or the warehouse credit issued and are not available to creditors of
AmeriCredit or its other subsidiaries.”

     Section 2.12 Negative Covenants of AmeriCredit. AmeriCredit hereby
agrees, during the Term of this Agreement, unless Financial Security shall
otherwise expressly consent in writing, as follows:

     (a) Impairment of Rights. AmeriCredit shall not take any action, or fail
to take any action, if such action or failure to take action may (i) interfere
with the enforcement of any rights under the Transaction Documents that are
material to the rights, benefits or obligations of the Trustee, the
Certificateholder or Financial Security, (ii) result in a Material Adverse
Change in respect of the Receivables or (iii) impair the ability of AmeriCredit
to perform its respective obligations under the Transaction Documents,
including any consolidation, merger with any Person or any transfer of all or
any material amount of the assets of AmeriCredit to any other Person if such
consolidation, merger or transfer would materially impair the net worth of
AmeriCredit or any successor Person obligated, after such event, to perform
such Person’s obligations under the Transaction Documents.

     (b) Waiver, Amendments, Etc. AmeriCredit shall not waive, modify or
amend, or consent to any waiver, modification or amendment of, any of the
provisions of any of the Transaction Documents.

     (c) Insolvency. AmeriCredit shall not commence with respect to the
Company, Funding Trust or AFS Funding, any case, proceeding or other action (i)
under any existing or future law of any jurisdiction, domestic or foreign,
relating to the bankruptcy, insolvency, reorganization or relief of debtors,
seeking to have an order for relief entered with respect to any of the Company,
the Trust, Funding Trust or AFS Funding, as the case may be, or seeking
reorganization, arrangement, adjustment, winding-up, liquidation, dissolution,
corporation or other relief with respect to any of the Company, the Trust,
Funding Trust or AFS Funding, as the case may be, or (ii) seeking appointment
of a receiver, trustee, custodian or other similar official for any of the
Trust, the Company, the Trust or AFS Funding, as the case may be, or for all or
any substantial part of their respective assets, or make a general assignment
for the benefit of their

29

 

respective creditors. AmeriCredit shall not take any action in
furtherance of, or indicating the consent to, approval of, or acquiescence in
any of the acts set forth above.

     (d) Compliance with Anti-Money Laundering Laws. AmeriCredit will not
employ any practice, procedure or policy in the conduct of its business that
would constitutes a material violation of any anti-money laundering law or
regulation (including without limitation, the USA PATRIOT Act, Public Law No.
107-56 (2001), and regulations promulgated thereunder) applicable to
AmeriCredit.

ARTICLE III

THE POLICIES; REIMBURSEMENT; INDEMNIFICATION

     Section 3.1 Issuance of the Policy. Financial Security agrees to issue
the Policy subject to satisfaction of the conditions precedent set forth in
Appendix A hereto.

     Section 3.2 Payment of Fees and Premium.

     (a) [Reserved].

     (b) Legal Fees. On the Date of Issuance, AmeriCredit shall pay or cause
to be paid legal fees and disbursements incurred by Financial Security in
connection with the issuance of the Policy up to an amount equal to $60,000.00,
plus disbursements, unless otherwise agreed between AmeriCredit and Financial
Security.

     (c) Rating Agency Fees. The initial fees of S&P, Moody’s and Fitch with
respect to the Securities and the transactions contemplated hereby shall be
paid by AmeriCredit in full on the Date of Issuance, or otherwise provided for
to the satisfaction of Financial Security. All periodic and subsequent fees of
S&P, Moody’s or Fitch with respect to, and directly allocable to, the
Securities shall be for the account of, and shall be billed to, AmeriCredit.
The fees for any other rating agency shall be paid by the party requesting such
other agency’s rating, unless such other agency is a substitute for S&P,
Moody’s or Fitch in the event that S&P, Moody’s or Fitch is no longer rating
the Securities, in which case the cost for such substitute agency shall be paid
by AmeriCredit.

     (d) Auditors’ Fees. In the event that Financial Security’s auditors are
required to provide information or any consent in connection with the Offering
Document prepared prior to the Date of Issuance, fees therefor not exceeding
$1,000 shall be paid by AmeriCredit. AmeriCredit shall pay on demand any
additional fees of Financial Security’s auditors payable in respect of any
Offering Document that are incurred after the Date of Issuance. It is
understood that Financial Security’s auditors shall not incur any additional
fees in respect of future Offering Documents except at the request of or with
the consent of AmeriCredit.

     (e) Premium. In consideration of the issuance by Financial Security of
the Policy, Financial Security shall be entitled to receive the Premium as and
when due in

30

 

accordance with the terms of the Premium Letter first (i) in accordance
with the provisions of Section 5.7(a) of the Sale and Servicing Agreement and
(ii) to the extent such amounts are insufficient, directly from AmeriCredit.
The Premium paid under the Sale and Servicing Agreement shall be nonrefundable
without regard to whether Financial Security makes any payment under the Policy
or any other circumstances relating to the Securities or provision being made
for payment of the Securities prior to maturity.

     Section 3.3 Reimbursement and Additional Payment Obligation. AmeriCredit
agrees to pay to Financial Security the following amounts as and when incurred:

     (a) a sum equal to the total of all amounts paid by Financial Security
under the Policy;

     (b) any and all out-of-pocket charges, fees, costs and expenses that
Financial Security or its affiliates may reasonably pay or incur, including,
but not limited to, attorneys’ and accountants’ fees and expenses, in
connection with (i) in the event of payments under the Policy, any accounts
established to facilitate payments under the Policy, to the extent Financial
Security has not been immediately reimbursed on the date that any amount is
paid by Financial Security under the Policy, or other administrative expenses
relating to such payments under the Policy, (ii) the prepayment of any
borrowings made or implementation or cancellation of any financial contracts
for limiting interest rate risk (including, without limitation, any interest
rate swaps and hedges) entered into in connection with, or (following an Event
of Default) in anticipation of, funding payments under the Policy, (iii) the
enforcement, defense or preservation of any rights in respect of any of the
Transaction Documents, including defending, monitoring or participating in any
litigation or proceeding (including any insolvency or bankruptcy proceeding in
respect of any Transaction participant or any affiliate thereof) relating to
any of the Transaction Documents, any party to any of the Transaction Documents
or the Transaction, (iv) any amendment, waiver or other action with respect to,
or related to, any Transaction Document whether or not executed or completed,
or (v) any review or investigation made by Financial Security in those
circumstances where its approval or consent is sought under any of the
Transaction Documents; costs and expenses shall include the reasonable fees and
expenses charged by Transaction Services Corporation, an affiliate of Financial
Security, spent in connection with the actions described in clause (iii) above;

     (c) interest on any and all amounts described in Section 3.3(a) or Section
3.2(b), or in connection with any Optional Deposit by Financial Security, from
the date due to Financial Security pursuant to the provisions hereof until
payment thereof in full, payable to Financial Security at the Late Payment Rate
per annum; and

     (d) any payments made by Financial Security on behalf of, or advanced to,
the Company, in its capacity as Servicer, or the Trustee, including, without
limitation, any amounts payable by the Company, in its capacity as Servicer, or
the Trustee pursuant to the Securities or any other Transaction Documents; and
any payments made by Financial Security as, or in lieu of, any servicing, management, trustee, custodial
or administrative

31

 

fees payable, in the sole discretion of Financial Security to
third parties in connection with the Transaction.

     All such amounts are to be immediately due and payable without demand, in
full, without any requirement on the part of Financial Security to seek
reimbursement of such amounts from any other source of reimbursement or
indemnity or to allocate such amount to any other transaction that may have
benefited from the expenditure of such amounts.

     Section 3.4 Certain Obligations Not Recourse to AmeriCredit.
Notwithstanding any provision of Section 3.3 to the contrary, the payment
obligations provided in Section 3.3(a), 3.3(b)(ii) and 3.3(d) (to the extent of
advances to the Trustee in respect of payments on the Securities), in each
case, to the extent that such payment obligations do not arise from any failure
or default in performance by an AmeriCredit Party of any of its obligations
under the Transaction Documents, and any interest on the foregoing in
accordance with Section 3.3(c), shall not be recourse to AmeriCredit, but shall
be payable in the manner and in accordance with priorities provided in the Sale
and Servicing Agreement.

     Section 3.5 Indemnification.

     (a) Indemnification by AmeriCredit. In addition to any and all rights of
reimbursement, indemnification, subrogation and any other rights pursuant
hereto or under law or in equity, each AmeriCredit Party agrees to pay, and to
protect, indemnify and save harmless, Financial Security and its officers,
directors, shareholders, employees, agents and each Person, if any, who
controls Financial Security within the meaning of either Section 15 of the
Securities Act or Section 20 of the Securities Exchange Act, from and against
any and all claims, losses, liabilities (including penalties), actions, suits,
judgments, demands, damages, costs or expenses (including, without limitation,
fees and expenses of attorneys, consultants and auditors and reasonable costs
of investigations) of any nature arising out of or relating to the transactions
contemplated by the Transaction Documents by reason of:

     (i) the negligence, bad faith, willful misconduct, misfeasance,
malfeasance or theft committed by any director, officer, employee or
agent of the Trust, AmeriCredit, the Company, or Funding Trust, as the
case may be;

     (ii) the breach by the Trust, AmeriCredit, the Company or Funding
Trust, as the case may be, of any representation, warranty or covenant
under any of the Transaction Documents or the occurrence, in respect of
the Trust, AmeriCredit, the Company or Funding Trust, as the case may be,
under any of the Transaction Documents of any “event of default” or any
event which, with the giving of notice or the lapse of time or both,
would constitute any “event of default”;

     (iii) any untrue statement or alleged untrue statement of a material
fact contained in any Offering Document or any omission or alleged
omission to state therein a material fact required to be stated therein or necessary
to make the

32

 

statements therein not misleading, except insofar as such
claims arise out of or are based upon any untrue statement or omission in
information included in an Offering Document and furnished by Financial
Security in writing expressly for use therein (all such information so
furnished being referred to herein as “Financial Security Information”),
it being understood that, in respect of the initial Offering Document,
the Financial Security Information is limited to the information included
under the caption “The Insurer” and the financial statements of Financial
Security appended thereto;

     (iv) the failure of AmeriCredit to notify the Secretary of State of
Maine pursuant to the Maine Statute Title 29-A §704 and §705; or

     (v) the failure of AmeriCredit to perfect any security interests
with respect to Receivables originated in Maine.

     (b) Conduct of Actions or Proceedings. If any action or proceeding
(including any governmental investigation) shall be brought or asserted against
Financial Security, any officer, director, shareholder, employee or agent of
Financial Security or any Person controlling Financial Security (individually,
an “Indemnified Party” and, collectively, the “Indemnified Parties”) in respect
of which indemnity may be sought from an AmeriCredit Party (the “Indemnifying
Party”) hereunder, Financial Security shall promptly notify the Indemnifying
Party in writing, and the Indemnifying Party shall assume the defense thereof,
including the employment of counsel satisfactory to Financial Security and the
payment of all expenses. An Indemnified Party shall have the right to employ
separate counsel in any such action and to participate in the defense thereof
at the expense of the Indemnified Party; provided, however, that the fees and
expenses of such separate counsel shall be at the expense of the Indemnifying
Party if (i) the Indemnifying Party has agreed to pay such fees and expenses,
(ii) the Indemnifying Party shall have failed to assume the defense of such
action or proceeding and employ counsel satisfactory to Financial Security in
any such action or proceeding or (iii) the named parties to any such action or
proceeding (including any impleaded parties) include both the Indemnified Party
and the Indemnifying Party, and the Indemnified Party shall have been advised
by counsel that (A) there may be one or more legal defenses available to it
which are different from or additional to those available to the Indemnifying
Party and (B) the representation of the Indemnifying Party and the Indemnified
Party by the same counsel would be inappropriate or contrary to prudent
practice (in which case, if the Indemnified Party notifies the Indemnifying
Party in writing that it elects to employ separate counsel at the expense of
the Indemnifying Party, the Indemnifying Party shall not have the right to
assume the defense of such action or proceeding on behalf of such Indemnified
Party, it being understood, however, that the Indemnifying Party shall not, in
connection with any one such action or proceeding or separate but substantially
similar or related actions or proceedings in the same jurisdiction arising out
of the same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys at any time for
the Indemnified Parties, which firm shall be designated in writing by Financial
Security). The Indemnifying Party shall not be liable for any settlement of
any such action or proceeding effected without its written consent to the extent that any
such settlement

33

 

shall be prejudicial to the Indemnifying Party, but, if settled
with its written consent, or if there be a final judgment for the plaintiff in
any such action or proceeding with respect to which the Indemnifying Party
shall have received notice in accordance with this subsection (b), the
Indemnifying Party agrees to indemnify and hold the Indemnified Parties
harmless from and against any loss or liability by reason of such settlement or
judgment.

     (c) Contribution. To provide for just and equitable contribution if the
indemnification provided by the Indemnifying Party is determined to be
unavailable for any Indemnified Party (other than due to application of this
Section), the Indemnifying Party shall contribute to the losses incurred by the
Indemnified Party on the basis of the relative fault of the Indemnifying Party,
on the one hand, and the Indemnified Party, on the other hand.

     Section 3.6 Subrogation. Subject only to the priority of payment
provisions of the Sale and Servicing Agreement, each of the Trust, AmeriCredit,
the Company and Funding Trust acknowledges that, to the extent of any payment
made by Financial Security pursuant to the Policy, Financial Security is to be
fully subrogated to the extent of such payment and any additional interest due
on any late payment, to the rights of the Noteholders to any moneys paid or
payable in respect of the Notes, under the Transaction Documents or otherwise.
Each of the Trust, AmeriCredit, the Company and Funding Trust agrees to such
subrogation and, further, agrees to execute such instruments and to take such
actions as, in the sole judgment of Financial Security, are necessary to
evidence such subrogation and to perfect the rights of Financial Security to
receive any moneys paid or payable in respect of the Securities under the
Transaction Documents or otherwise.

ARTICLE IV

FURTHER AGREEMENTS

     Section 4.1 Effective Date; Term of Agreement. This Agreement shall take
effect on the Date of Issuance and shall remain in effect until the later of
(a) such time as Financial Security is no longer subject to a claim under the
Policy and the Policy shall have been surrendered to Financial Security for
cancellation and (b) all amounts payable to Financial Security and the
Certificateholder under the Transaction Documents and under the Securities have
been paid in full; provided, however, that the provisions of Sections 3.2, 3.3
and 3.5 hereof shall survive any termination of this Agreement.

     Section 4.2 Obligations Absolute.

     (a) The payment obligations of AmeriCredit hereunder shall be absolute and
unconditional, and shall be paid strictly in accordance with this Agreement
under all circumstances irrespective of (i) any lack of validity or
enforceability of, or any amendment or other modifications of, or waiver with
respect to, any of the Transaction Documents, the Securities or the Policy;
(ii) any exchange or release of any other
obligations hereunder; (iii) the existence of any claim, setoff, defense,
reduction,

34

 

abatement or other right which any of the Trust, AmeriCredit, the
Company or Funding Trust may have at any time against Financial Security or any
other Person; (iv) any document presented in connection with the Policy proving
to be forged, fraudulent, invalid or insufficient in any respect, including any
failure to strictly comply with the terms of the Policy, or any statement
therein being untrue or inaccurate in any respect; (v) any failure of Funding
Trust to receive the proceeds from the sale of the Securities; (vii) any breach
by the Trust, AmeriCredit, the Company or Funding Trust of any representation,
warranty or covenant contained in any of the Transaction Documents; or (viii)
any other circumstances, other than payment in full, which might otherwise
constitute a defense available to, or discharge of, the Trust, AmeriCredit, the
Company or Funding Trust in respect of any Transaction Document.

     (b) Each of the Trust, AmeriCredit, the Company and Funding Trust and any
and all others who are now or may become liable for all or part of the
obligations of AmeriCredit, the Company and Funding Trust under this Agreement
agrees to be bound by this Agreement and (i) to the extent permitted by law,
waives and renounces any and all redemption and exemption rights and the
benefit of all valuation and appraisement privileges against the indebtedness,
if any, and obligations evidenced by any Transaction Document or by any
extension or renewal thereof; (ii) waives presentment and demand for payment,
notices of nonpayment and of dishonor, protest of dishonor and notice of
protest; (iii) waives all notices in connection with the delivery and
acceptance hereof and all other notices in connection with the performance,
default or enforcement of any payment hereunder except as required by the
Transaction Documents; (iv) waives all rights of abatement, diminution,
postponement or deduction, or to any defense other than payment, or to any
right of setoff or recoupment arising out of any breach under any of the
Transaction Documents, by any party thereto or any beneficiary thereof, or out
of any obligation at any time owing to AmeriCredit, the Company or Funding
Trust; (v) agrees that any consent, waiver or forbearance hereunder with
respect to an event shall operate only for such event and not for any
subsequent event; (vi) consents to any and all extensions of time that may be
granted by Financial Security with respect to any payment hereunder or other
provisions hereof and to the release of any security at any time given for any
payment hereunder, or any part thereof, with or without substitution, and to
the release of any Person or entity liable for any such payment; and (vii)
consents to the addition of any and all other makers, endorsers, guarantors and
other obligors for any payment hereunder, and to the acceptance of any and all
other security for any payment hereunder, and agrees that the addition of any
such obligors or security shall not affect the liability of the parties hereto
for any payment hereunder.

     (c) Nothing herein shall be construed as prohibiting the Trust,
AmeriCredit, the Company or Funding Trust from pursuing any rights or remedies
it may have against any Person other than Financial Security in a separate
legal proceeding.

     Section 4.3 Assignments; Reinsurance; Third-Party Rights.

     (a) This Agreement shall be a continuing obligation of the parties hereto
and shall be binding upon and inure to the benefit of the parties hereto and
their respective
successors and permitted assigns. None of the Trust, AmeriCredit, the
Company or

35

 

Funding Trust may assign its rights under this Agreement, or
delegate any of its duties hereunder, without the prior written consent of
Financial Security. Any assignment made in violation of this Agreement shall
be null and void.

     (b) Financial Security shall have the right to give participations in its
rights under this Agreement and to enter into contracts of reinsurance with
respect to the Policy upon such terms and conditions as Financial Security may
in its discretion determine; provided, however, that no such participation or
reinsurance agreement or arrangement shall relieve Financial Security of any of
its obligations hereunder or under the Policy.

     (c) In addition, Financial Security shall be entitled to assign or pledge
to any bank or other lender providing liquidity or credit with respect to the
Transaction or the obligations of Financial Security in connection therewith
any rights of Financial Security under the Transaction Documents or with
respect to any real or personal property or other interests pledged to
Financial Security, or in which Financial Security has a security interest, in
connection with the Transaction.

     (d) Except as provided herein with respect to participants and reinsurers,
nothing in this Agreement shall confer any right, remedy or claim, express or
implied, upon any Person, including, particularly, any Noteholder or the
Certificateholder, other than Financial Security, against the Trust,
AmeriCredit, the Company or Funding Trust, and all the terms, covenants,
conditions, promises and agreements contained herein shall be for the sole and
exclusive benefit of the parties hereto and their successors and permitted
assigns. None of the Indenture Trustee, the Owner Trustee nor any Noteholder
or the Certificateholder shall have any right to payment from any premiums paid
or payable hereunder or from any other amounts paid by AmeriCredit pursuant to
Section 3.2, 3.3 or 3.5 hereof.

     Section 4.4 Liability of Financial Security. Neither Financial Security
nor any of its officers, directors or employees shall be liable or responsible
for: (a) the use which may be made of the Policy by the Indenture Trustee or
the Owner Trustee or for any acts or omissions of the Indenture Trustee or the
Owner Trustee in connection therewith or (b) the validity, sufficiency,
accuracy or genuineness of documents delivered to Financial Security (or its
Fiscal Agent) in connection with any claim under the Policy, or of any
signatures thereon, even if such documents or signatures should in fact prove
to be in any or all respects invalid, insufficient, fraudulent or forged
(unless Financial Security had actual knowledge thereof). In furtherance and
not in limitation of the foregoing, Financial Security (or its Fiscal Agent)
may accept documents that appear on their face to be in order, without
responsibility for further investigation.

     Section 4.5 [Reserved].

     Section 4.6 [Reserved].

36

 

ARTICLE V

EVENTS OF DEFAULT; REMEDIES

     Section 5.1 Events of Default. The occurrence of any of the following
events shall constitute an Event of Default hereunder:

     (a) any demand for payment shall be made under the Policy;

     (b) any representation, warranty or covenant made by any of the Trust,
AmeriCredit, the Company, Funding Trust or AFS Funding under any of the
Transaction Documents, or in any certificate or report furnished under any of
the Transaction Documents, shall prove to be untrue or incorrect in any
material respect; provided, however, that if the Trust, AmeriCredit, the
Company, Funding Trust or AFS Funding, as the case may be, effectively cures
any such defect in any representation or warranty under any Transaction
Document, or certificate or report furnished under any Transaction Document,
within the time period specified in the relevant Transaction Document as the
cure period therefor, such defect shall not in and of itself constitute an
Event of Default hereunder;

     (c) (i) any of the Trust, AmeriCredit, the Company or Funding Trust shall
fail to pay when due any amount payable under any of the Transaction Documents
unless such amounts are paid in full within any applicable cure period
explicitly provided for under the relevant Transaction Document; (ii) the
Trust, AmeriCredit, the Company, Funding Trust or AFS Funding shall have
asserted that any of the Transaction Documents to which it is a party is not
valid and binding on the parties thereto; or (iii) any court, governmental
authority or agency having jurisdiction over any of the parties to any of the
Transaction Documents or any property thereof shall find or rule that any
material provision of any of the Transaction Documents is not valid and binding
on the parties thereto;

     (d) any of the Trust, AmeriCredit, the Company, Funding Trust or AFS
Funding shall fail to perform or observe any other covenant or agreement
contained in any of the Transaction Documents (except for the obligations
described under clause (c)(i) above or clause (m) below) and such failure shall
continue for a period of 30 days after written notice given to the Trust or
Funding Trust by Financial Security (which notice shall be forwarded to
AmeriCredit and the Company by the Trust, Funding Trust or AFS Funding,
provided however, that, such forwarding shall not be a condition to the
occurrence of an Event of Default under this Section 5.1(d)), as the case may
be; provided, however, that, if such failure shall be of a nature that it
cannot be cured within 30 days, such failure shall not constitute an Event of
Default hereunder if within such 30-day period the Trust or Funding Trust, as
the case may be, shall have given notice to Financial Security of corrective
action it proposes to take, which corrective action is agreed in writing by
Financial Security to be satisfactory and the Trust or Funding Trust, as the
case may be, shall thereafter pursue such corrective action diligently until
such default is cured;

37

 

     (e) any of the Trust, AmeriCredit, the Company or Funding Trust shall fail
to pay its debts generally as they come due, or shall admit in writing its
inability to pay its debts generally, or shall make a general assignment for
the benefit of creditors, or shall institute any proceeding seeking to
adjudicate it insolvent or seeking a liquidation, or shall take advantage of
any insolvency act, or shall commence a case or other proceeding naming it as
debtor under the United States Bankruptcy Code or similar law, domestic or
foreign, or a case or other proceeding shall be commenced against any of the
Trust, AmeriCredit, the Company or Funding Trust under the United States
Bankruptcy Code or similar law, domestic or foreign, or any proceeding shall be
instituted against any of the Trust, AmeriCredit, the Company or Funding Trust
seeking liquidation of their respective assets and such Person shall fail to
take appropriate action resulting in the withdrawal or dismissal of such
proceeding within 30 days or there shall be appointed or any of the Trust,
AmeriCredit, the Company or Funding Trust shall consent to, or acquiesce in,
the appointment of a receiver, liquidator, conservator, trustee or similar
official in respect of such Person or the whole or any substantial part of its
respective properties or assets or such Person shall take any corporate action
in furtherance of any of the foregoing;

     (f) on any Insured Distribution Date, after taking into account the
application in accordance with Section 5.7(a) of the Sale and Servicing
Agreement on the related Distribution Date of the sum of Available Funds, any
Deficiency Claim Amount Deposits and any Accelerated Payment Amount Shortfall
Deposits with respect to such related Distribution Date and the amounts
available in the Series 2004-D-F Spread Account (prior to withdrawals therefrom
in accordance with the terms of the Spread Account Agreement and prior to any
deposits into such Spread Account from Spread Accounts related to any other
Series), any amounts payable on such related Distribution Date pursuant to
clauses (i), (ii), (iii) or (v) of Section 5.7(a) of the Sale and Servicing
Agreement have not been paid in full;

     (g) the occurrence of a Section 5.1(g) Delinquency Ratio Test Failure as
set forth in the AmeriCredit 2004-D-F Letter Agreement;

     (h) the occurrence of a Section 5.1(h) Cumulative Default Rate Test
Failure as set forth in the AmeriCredit 2004-D-F Letter Agreement;

     (i) the occurrence of a Section 5.1(i) Cumulative Net Loss Rate Test
Failure as set forth in the AmeriCredit 2004-D-F Letter Agreement;

     (j) the occurrence of a Servicer Termination Event under the Sale and
Servicing Agreement;

     (k) the Trust becomes taxable as an association (or publicly traded
partnership) taxable as a corporation for federal or state income tax purposes;

     (l) any default in the observance or performance of any covenant or
agreement of the Trust made in the Indenture (other than a default in the
payment of the interest or principal on any Note when due) or any
representation or warranty of the Trust made in the Indenture or in any
certificate or other writing delivered pursuant thereto or

38

 

in connection therewith proving to have been incorrect in any material
respect as of the time when the same shall have been made, and such default
shall continue or not be cured, or the circumstance or condition in respect of
which such misrepresentation or warranty was incorrect shall not have been
eliminated or otherwise cured, for a period of 30 days after there shall have
been given, by registered or certified mail, to the Trust and the Indenture
Trustee by Financial Security, a written notice specifying such default or
incorrect representation or warranty and requiring it to be remedied; and

     (m) the failure of the Company or Funding Trust to comply with Section
2.8(j) of this Insurance Agreement.

     Section 5.2 Remedies; Waivers.

     (a) Upon the occurrence of an Event of Default, Financial Security may
exercise any one or more of the rights and remedies set forth below:

     (i) exercise any rights and remedies available under the Transaction
Documents in its own capacity or in its capacity as the Person entitled
to exercise the rights of the Controlling Party under the Transaction
Documents, including, without limitation, its right to accelerate the
Notes or to terminate the Company and to appoint a successor Servicer; or

     (ii) take whatever action at law or in equity may appear necessary
or desirable in its judgment to enforce performance of any obligation of
the Trust, AmeriCredit, the Company or Funding Trust under the
Transaction Documents.

     (b) Unless otherwise expressly provided, no remedy herein conferred upon
or reserved is intended to be exclusive of any other available remedy, but each
remedy shall be cumulative and shall be in addition to other remedies given
under the Transaction Documents or existing at law or in equity. No delay or
failure to exercise any right or power accruing under any Transaction Document
upon the occurrence of any Event of Default or otherwise shall impair any such
right or power or shall be construed to be a waiver thereof, but any such right
and power may be exercised from time to time and as often as may be deemed
expedient. In order to entitle Financial Security to exercise any remedy
reserved to Financial Security in this Article, it shall not be necessary to
give any notice, other than such notice as may be expressly required in this
Article.

     (c) If any proceeding has been commenced to enforce any right or remedy
under this Agreement and such proceeding has been discontinued or abandoned for
any reason, or has been determined adversely to Financial Security, then and in
every such case the parties hereto shall, subject to any determination in such
proceeding, be restored to their respective former positions hereunder, and,
thereafter, all rights and remedies of Financial Security shall continue as
though no such proceeding had been instituted.

     (d) Financial Security shall have the right, to be exercised in its
complete discretion, to waive any covenant, Default or Event of Default or
collection of Premium Supplement by a writing setting forth the terms,
conditions and extent of such waiver signed by Financial Security and delivered
to the Trust, AmeriCredit, the Company or

39

 

Funding Trust, as the case may be. Any such waiver may only be effected
in writing duly executed by Financial Security, and no other course of conduct
shall constitute a waiver of any provision hereof. Unless such writing
expressly provides to the contrary, any waiver so granted shall extend only to
the specific event or occurrence so waived and not to any other similar event
or occurrence.

ARTICLE VI

MISCELLANEOUS

     Section 6.1 Amendments, Etc. This Agreement may be amended, modified or
terminated only by written instrument or written instruments signed by the
parties hereto, provided that the Rating Agencies shall be notified in writing
of any such amendment, modification or termination in accordance with the
notice provisions set forth in the Sale and Servicing Agreement. No act or
course of dealing shall be deemed to constitute an amendment, modification or
termination hereof.

     Section 6.2 Notices. All demands, notices and other communications to be
given hereunder shall be in writing (except as otherwise specifically provided
herein) and shall be mailed by registered mail or personally delivered or
telecopied to the recipient as follows:

	 	 	 	 	 	 	 
	(a)	 	To Financial Security:	 	Financial Security Assurance Inc.
	 	 	 	 	350 Park Avenue
	 	 	 	 	New York, NY 10022
	 	 	 	 	Attention: Transaction
Oversight Department
	 	 	 	 	Re: Americredit
Receivables –Backed Notes Series 2004-D-F
	 	 	 	 	Policy No. 51589-N
	

	 	 	 	Confirmation:
	 	(212) 826-0100
	

	 	 	 	Telecopy Nos.:
	 	(212) 339-3518,
	

	 	 	 	 	 	(212) 339-3529

	 	 	 
	 

	 	(in each case in which notice or other
communication to Financial Security refers to
an Event of Default, a claim on the Policy or
with respect to which failure on the part of
Financial Security to respond shall be deemed
to constitute consent or acceptance, then a
copy of such notice or other communication
should also be sent to the attention of each
of the General Counsel and the Head—Financial
Guaranty Group and shall be marked to indicate
“URGENT MATERIAL ENCLOSED.”)

40

 

	 	 	 	 	 
	(b)

	 	To AmeriCredit:
	 	AmeriCredit Corp.
	

	 	 	 	801 Cherry Street, Suite 3900
	

	 	 	 	Fort Worth, Texas 76102
	

	 	 	 	Attention: Chief Financial Officer
	 
	 	 	 	 
	(c)

	 	To the Company:
	 	AmeriCredit Financial Services, Inc.
	

	 	 	 	801 Cherry Street, Suite 3900
	

	 	 	 	Fort Worth, Texas 76102
	

	 	 	 	Attention: Chief Financial Officer
	 
	 	 	 	 
	(d)

	 	To Funding Trust:
	 	AFS Funding Trust
	

	 	 	 	c/o Deutsche Bank Trust Company Delaware
	

	 	 	 	E.A. Delle Donne Corporate Center
	

	 	 	 	Montgomery Building
	

	 	 	 	1011 Centre Road
	

	 	 	 	Wilmington, DE 19805-1266
	 
	 	 	 	 
	

	 	With a copy to:
	 	AmeriCredit Financial Services, Inc.
	

	 	 	 	801 Cherry Street, Suite 3900
	

	 	 	 	Fort Worth, TX 76102
	

	 	 	 	Attention: Chief Financial Officer
	 
	 	 	 	 
	(e)

	 	To the Trust:
	 	AmeriCredit Automobile Receivables Trust 2004-D-F
	

	 	 	 	c/o Wilmington Trust Company
	

	 	 	 	Rodney Square North
	

	 	 	 	1100 North Market Street
	

	 	 	 	Wilmington, DE 19890-0001

     A party may specify an additional or different address or addresses by
writing mailed or delivered to the other party as aforesaid. All such notices
and other communications shall be effective upon receipt.

     Section 6.3 Payment Procedure. In the event of any payment by Financial
Security for which it is entitled to be reimbursed or indemnified as provided
above, each of the Trust, AmeriCredit, the Company and Funding Trust agrees to
accept the voucher or other evidence of payment as prima facie evidence of the
propriety thereof and the liability therefor to Financial Security. All
payments to be made to Financial Security under this Agreement shall be made to
Financial Security in lawful currency of the United States of America in
immediately available funds to the account number provided in the Premium
Letter before 1:00 p.m. (New York, New York time) on the date when due or as
Financial Security shall otherwise direct by written notice to the Trust,
AmeriCredit, the Company and Funding Trust. In the event that the date of any
payment to Financial Security or the expiration of any time period hereunder
occurs on a day which is not a Business Day, then such payment or expiration of
time period shall be made or occur on the next succeeding Business Day with the
same force and effect as if

41

 

such payment was made or time period expired on the scheduled date of
payment or expiration date. Payments to be made to Financial Security under
this Agreement shall bear interest at the Late Payment Rate from the date due
to the date paid, and shall include interest on overdue interest, compounded
monthly.

     Section 6.4 Severability. In the event that any provision of this
Agreement shall be held invalid or unenforceable by any court of competent
jurisdiction, the parties hereto agree that such holding shall not invalidate
or render unenforceable any other provision hereof. The parties hereto further
agree that the holding by any court of competent jurisdiction that any remedy
pursued by any party hereto is unavailable or unenforceable shall not affect in
any way the ability of such party to pursue any other remedy available to it.

     Section 6.5 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH, AND THIS AGREEMENT AND ALL MATTERS ARISING OUT OF OR RELATING
IN ANY WAY TO THIS AGREEMENT SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NEW
YORK.

     Section 6.6 Consent to Jurisdiction.

     (a) THE PARTIES HERETO HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF
THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK AND ANY
COURT IN THE STATE OF NEW YORK LOCATED IN THE CITY AND COUNTY OF NEW YORK, AND
ANY APPELLATE COURT FROM ANY THEREOF, IN ANY ACTION, SUIT OR PROCEEDING BROUGHT
AGAINST IT AND TO OR IN CONNECTION WITH ANY OF THE TRANSACTION DOCUMENTS OR THE
TRANSACTIONS CONTEMPLATED THEREUNDER OR FOR RECOGNITION OR ENFORCEMENT OF ANY
JUDGMENT, AND THE PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY AGREE
THAT ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD OR
DETERMINED IN SUCH NEW YORK STATE COURT OR, TO THE EXTENT PERMITTED BY LAW, IN
SUCH FEDERAL COURT. THE PARTIES HERETO AGREE THAT A FINAL JUDGMENT IN ANY SUCH
ACTION, SUIT OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER
JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PROVIDED BY LAW.
TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HERETO HEREBY WAIVE AND
AGREE NOT TO ASSERT BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE IN ANY SUCH
SUIT, ACTION OR PROCEEDING, ANY CLAIM THAT IT IS NOT PERSONALLY SUBJECT TO THE
JURISDICTION OF SUCH COURTS, THAT THE SUIT, ACTION OR PROCEEDING IS BROUGHT IN
AN INCONVENIENT FORUM, THAT THE VENUE OF THE SUIT, ACTION OR PROCEEDING IS
IMPROPER OR THAT THE TRANSACTION DOCUMENTS OR THE SUBJECT MATTER THEREOF MAY
NOT BE LITIGATED IN OR BY SUCH COURTS.

42

 

     (b) To the extent permitted by applicable law, the parties hereto shall
not seek and hereby waive the right to any review of the judgment of any such
court by any court of any other nation or jurisdiction which may be called upon
to grant an enforcement of such judgment.

     (c) Each of AmeriCredit, the Company and Funding Trust hereby irrevocably
appoints and designates The Prentice-Hall Corporation System, Inc., whose
address is 15 Columbus Circle, New York, New York 10023-7773, as its true and
lawful attorney and duly authorized agent for acceptance of service of legal
process. Each of AmeriCredit, the Company, and Funding Trust agrees that
service of such process upon such Person shall constitute personal service of
such process upon it.

     (d) Nothing contained in the Agreement shall limit or affect Financial
Security’s right to serve process in any other manner permitted by law or to
start legal proceedings relating to any of the Transaction Documents against
AmeriCredit, the Company or Funding Trust or their property in the courts of
any jurisdiction.

     Section 6.7 Consent of Financial Security. In the event that Financial
Security’s consent is required under any of the Transaction Documents, the
determination whether to grant or withhold such consent shall be made by
Financial Security in its sole discretion without any implied duty towards any
other Person, except as otherwise expressly provided therein.

     Section 6.8 Counterparts. This Agreement may be executed in counterparts
by the parties hereto, and all such counterparts shall constitute one and the
same instrument.

     Section 6.9 Trial by Jury Waived. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY LAW, ANY RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY
LITIGATION ARISING DIRECTLY OR INDIRECTLY OUT OF, UNDER OR IN CONNECTION WITH
ANY OF THE TRANSACTION DOCUMENTS OR ANY OF THE TRANSACTIONS CONTEMPLATED
THEREUNDER. EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR
ATTORNEY OF ANY PARTY HERETO HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT IT
WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND
(B) ACKNOWLEDGES THAT IT HAS BEEN INDUCED TO ENTER INTO THE TRANSACTION
DOCUMENTS TO WHICH IT IS A PARTY BY, AMONG OTHER THINGS, THIS WAIVER.

     Section 6.10 Limited Liability. (a) No recourse under any Transaction
Document shall be had against, and no personal liability shall attach to, any
officer, employee, director, affiliate or shareholder of any party hereto, as
such, by the enforcement of any assessment or by any legal or equitable
proceeding, by virtue of any statute or otherwise in respect of any of the
Transaction Documents, the Securities or the Policy, it being expressly agreed
and understood that each Transaction Document is solely a corporate obligation
of each party hereto, and that any and all personal liability, either at common law or in equity, or by statute or constitution, of every
such officer,

43

 

employee, director, affiliate or shareholder for breaches by any
party hereto of any obligations under any Transaction Document is hereby
expressly waived as a condition of and in consideration for the execution and
delivery of this Agreement.

     (a) 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 trustee of the Trust, in the exercise
of the powers and authority conferred and vested in it under the Trust
Agreement, (b) each of the representations, undertakings and agreements herein
made on the part of the Trust is 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 Trust and (c) under no
circumstances shall Wilmington Trust Company be personally liable for the
payment of any indebtedness or expenses of the Trust or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Trust under this Agreement or the other Transaction
Documents.

     Section 6.11 Entire Agreement. This Agreement, the Premium Letter and the
Policy set forth the entire agreement between the parties with respect to the
subject matter thereof, and this Agreement supersedes and replaces any
agreement or understanding that may have existed between the parties prior to
the date hereof in respect of such subject matter.

44

 

     IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Insurance and Indemnity Agreement, all as of the day and year first above
written.

	 	 	 	 	 
	 	 	FINANCIAL SECURITY ASSURANCE INC.
	 	 	
By:
	 	/s/ Ravi Gandhi

Authorized Officer
	 	 	AMERICREDIT AUTOMOBILE RECEIVABLES TRUST 2004-D-F
	 	 	 	 	by WILMINGTON TRUST COMPANY, not in its

individual capacity but solely as Owner

Trustee
	 	 	
By:
	 	/s/ Janel R. Havrilla

Title: Financial Services Officer
	 	 	AMERICREDIT FINANCIAL SERVICES, INC.
	 	 	
By:
	 	/s/ Susan B. Sheffield

Title: Senior Vice President
	 	 	AMERICREDIT CORP.
	 	 	
By:
	 	/s/ J. Michael May

Title: Senior Vice President

[Insurance Agreement Signature Page]

 

 

	 	 	 	 	 
	 	 	AFS FUNDING TRUST
By: AMERICREDIT FINANCIAL SERVICES, INC., as Administrator
	 	 	
By:
	 	/s/ Susan B. Sheffield

Name: Susan B. Sheffield

Title: Senior Vice President

[Insurance Agreement Signature Page]

 

 

APPENDIX I

DEFINITIONS

     “1994-A Issuer Stock Pledge Agreement” means the Stock Pledge Agreement,
as defined in the Series 1994-A Sale and Servicing Agreement.

     “1995-A Issuer Stock Pledge Agreement” means the Stock Pledge Agreement,
as defined in the Series 1995-A Sale and Servicing Agreement.

     “Administration Agreement” means the Administration Agreement dated as of
August 15, 2002 between Funding Trust and the Company.

     “AmeriCredit” means AmeriCredit Corp., a Texas corporation.

     “AmeriCredit Parties” means each of AmeriCredit, the Company and Funding
Trust.

     “AmeriCredit 2004-D-F Letter Agreement” means that certain letter
agreement dated as of November 9, 2004 among Financial Security, Funding Trust,
the Trust, the Company, AmeriCredit and JPMorgan Chase Bank, as the same may be
amended, supplemented or otherwise modified in accordance with the terms
thereof.

     “AFS Funding” means AFS Funding Corp., a Nevada corporation.

     “Business Day” means any day other than a Saturday, Sunday, legal holiday
or other day on which commercial banking institutions in Fort Worth, Texas, New
York, New York or the principal place of business of any successor Servicer,
successor Indenture Trustee, successor Owner Trustee or successor Collateral
Agent, are authorized or obligated by law, executive order or governmental
decree to be closed.

     “Certificate” means the Certificate of Trust issued pursuant to the Trust
Agreement.

     “Certificateholder” means the registered holder of the Certificate.

     “Code” means the Internal Revenue Code of 1986, including, unless the
context otherwise requires, the rules and regulations thereunder, as amended
from time to time.

     “Commission” means the Securities and Exchange Commission.

     “Commonly Controlled Entity” means AmeriCredit and each entity, whether or
not incorporated, which is affiliated with AmeriCredit pursuant to Section
414(b), (c), (m) or (o) of the Code.

     “Company” means AmeriCredit Financial Services, Inc., a Delaware
corporation.

     “Date of Issuance” means the date on which the Policy is issued as
specified therein.

I-1

 

     “Default” means any event which results, or which with the giving of
notice or the lapse of time or both would result, in an Event of Default.

     “Depositor” means Funding Trust in its capacity as Depositor under the
Trust Agreement.

     “ERISA” means the Employee Retirement Income Security Act of 1974,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.

     “Event of Default” means any event of default specified in Section 5.1 of
the Insurance Agreement.

     “Expiration Date” means the final date of the Term Of The Policy, as
specified in the Policy.

     “Financial Security” means Financial Security Assurance Inc., a New York
stock insurance company, its successors and assigns.

     “Financial Statements” means with respect to AmeriCredit the consolidated
balance sheets as of June 30, 2004 and the statements of income, shareholder’s
equity and cash flows for the 12-month period then ended and the notes thereto
and the consolidated balance sheets as of each June 30, September 30, December
31 and March 31 thereafter, and the consolidated statements of income and cash
flows for the fiscal quarter then ended.

     “Fiscal Agent” means the Fiscal Agent, if any, designated pursuant to the
terms of the Policy.

     “Fitch” means Fitch Inc. and any successor thereto, and, if such
corporation shall for any reason no longer perform the functions of a
securities rating agency, “Fitch” shall be deemed to refer to any other
nationally recognized rating agency designated by Financial Security.

     “Funding Trust” means AFS Funding Trust, a Delaware statutory trust.

     “Funding Trust Agreement” means the Second Amended and Restated Trust
Agreement, dated as of August 15, 2002 between AFS Funding Corp. and Deutsche
Bank Trust Company Delaware (formerly known as Bankers Trust (Delaware)) as the
same may be amended from time to time.

     “Indemnification Agreement” means the Indemnification Agreement dated as
of the date hereof among Financial Security, Funding Trust and the
Representative, as the same may be amended from time to time.

     “Indenture” means the Indenture dated as of October 26, 2004 between the
Trust and JPMorgan Chase Bank, as Trustee and Trust Collateral Agent.

I-2

 

     “Indenture Trustee” means JPMorgan Chase Bank, as trustee under the
Indenture, and any successor thereto as trustee under the Indenture.

     “Insurance Agreement” means this Insurance and Indemnity Agreement dated
as of the date hereof, among Financial Security, the Trust, AmeriCredit, the
Company and Funding Trust, as the same may be amended from time to time.

     “Insurance Agreement Event of Default” means any Event of Default
specified in Section 5.1.

     “Insurance Agreement Indenture Cross Default” means an Event of Default
specified in clauses (a), (e), (f), (k), (l) or (m) of Section 5.1.

     “Investment Company Act” means the Investment Company Act of 1940,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.

     “IRS” means the Internal Revenue Service.

     “JPMorgan Chase Bank” means JPMorgan Chase Bank, a New York banking
corporation.

     “Late Payment Rate” means the lesser of (a) the greater of (i) the per
annum rate of interest, publicly announced from time to time by JPMorgan Chase
Bank principal office in the City of New York as its prime or base lending rate
(any change in such rate of interest to be effective on the date such change is
announced by JPMorgan Chase Bank plus 3%), and (ii) the then applicable highest
rate of interest on the Securities and (b) the maximum rate permissible under
applicable usury or similar laws limiting interest rates. The Late Payment
Rate shall be computed on the basis of the actual number of days elapsed over
the actual number of days in the current calendar year.

     “Lender” means the lender named in the MBIA IV Security Agreement.

     “Lien” means, as applied to the property or assets (or the income or
profits therefrom) of any Person, in each case whether the same is consensual
or nonconsensual or arises by contract, operation of law, legal process or
otherwise: (a) any mortgage, lien, pledge, attachment, charge, lease,
conditional sale or other title retention agreement, or other security interest
or encumbrance of any kind or (b) any arrangement, express or implied, under
which such property or assets are transferred, sequestered or otherwise
identified for the purpose of subjecting or making available the same for the
payment of debt or performance of any other obligation in priority to the
payment of the general, unsecured creditors of such Person.

     “Lockbox Agreement” means the Lockbox Agreement, as defined in the Sale
and Servicing Agreement.

     “Master Trust Indenture” means the Second Amended and Restated Indenture
dated as of November 5, 2003, by and among AmeriCredit Master Trust and

     JPMorgan

I-3

 

Chase, as successor in interest to, Bank One, as the same may be amended
from time to time.

     “Material Adverse Change” means, (a) in respect of any Person, a material
adverse change in (i) the business, financial condition, results of operations
or properties of such Person or any of its Subsidiaries or (ii) the ability of
such Person to perform its obligations under any of the Transaction Documents
to which it is a party and (b) in respect of the Receivables, a material
adverse change in (i) the value or marketability of the Receivables, taken as a
whole, or (ii) the probability that amounts now or hereafter due in respect of
a material portion of the Receivables will be collected on a timely basis.

     “MBIA” means MBIA Insurance Corporation.

     “MBIA IV Security Agreement” means the Security Agreement dated as of
October 1, 2004, by and among AmeriCredit MTN Receivables Trust IV, the
Company, AmeriCredit MTN Corp. IV and JPMorgan Chase, as the same may be
amended from time to time.

     “Moody’s” means Moody’s Investors Service, a Delaware corporation, and any
successor thereto, and, if such corporation shall for any reason no longer
perform the functions of a securities rating agency, “Moody’s” shall be deemed
to refer to any other nationally recognized rating agency designated by
Financial Security.

     “Multiemployer Plan” means a multiemployer plan (within the meaning of
Section 4001(a)(3) of ERISA) in respect of which a Commonly Controlled Entity
makes contributions or has liability.

     “Noteholders” means the registered holders of the Notes.

     “Notes” means the Trust’s $145,000,000 Class A-1 2.08% Asset Backed Notes,
$236,000,000 Class A-2 2.53% Asset Backed Notes, $197,000,000 Class A-3 2.98%
Asset Backed Notes and $172,000,000 Class A-4 3.43% Asset Backed Notes issued
pursuant to the Series 2004-D-F Indenture.

     “Notice of Claim” means a Notice of Claim and Certificate in the form
attached as Exhibit A to Endorsement No. 1 to the Policy.

     “Offering Document” means the Prospectus dated July 10, 2003, and the
Prospectus Supplement dated October 25, 2004 relating to the Securities and any
amendment or supplement thereto and any other offering document in respect of
the Securities that makes reference to the Policy.

     “Other Transactions” means the AmeriCredit Automobile Receivables Trust
2000-D transaction, the AmeriCredit Automobile Receivables Trust 2001-A
transaction, the AmeriCredit Automobile Receivables Trust 2001-B transaction,
the AmeriCredit Automobile Receivables Trust 2001-C transaction, the
AmeriCredit Automobile Receivables Trust 2001-D transaction and the AmeriCredit
Automobile Receivables Trust 2002-A transaction, the AmeriCredit Automobile
Receivables Trust 2002-B

I-4

 

transaction, the AmeriCredit Automobile Receivables Trust 2002-C
transaction, the AmeriCredit Automobile Receivables Trust 2002-D transaction,
the AmeriCredit Automobile Receivables Trust 2003-C-F transaction and the
AmeriCredit Automobile Receivables Trust 2004-A-F transaction.

     “Owner Trustee” means Wilmington Trust Company as owner trustee under the
Trust Agreement, and any successor thereto as owner trustee under the Trust
Agreement.

     “PBGC” means the Pension Benefit Guaranty Corporation or any successor
agency, corporation or instrumentality of the United States to which the duties
and powers of the Pension Benefit Guaranty Corporation are transferred.

     “Person” means an individual, joint stock company, trust, unincorporated
association, joint venture, corporation, business or owner trust, partnership
or other organization or entity (whether governmental or private).

     “Plan” means any pension plan (other than a Multiemployer Plan) covered by
Title IV of ERISA, which is maintained by a Commonly Controlled Entity or in
respect of which a Commonly Controlled Entity has liability.

     “Policy” means the financial guaranty insurance policy, including any
endorsements thereto, issued by Financial Security with respect to the
Securities substantially in the form attached as Annex I to the Insurance
Agreement.

     “Premium” means the premium payable in accordance with Section 3.2 of this
Agreement and the Premium Supplement, if any.

     “Premium Letter” means the side letter between Financial Security and
AmeriCredit dated the Date of Issuance in respect of the premium (including
Premium Supplement) payable by AmeriCredit in consideration of the issuance of
the Policy.

     “Premium Supplement” means a non-refundable premium, in addition to the
premium payable in accordance with Section 3.2 of this Agreement, accruing to
Financial Security in monthly installments commencing on the date of the
occurrence of an Event of Default whether or not an Event of Default shall have
been declared and on each monthly anniversary thereof in accordance with the
terms set forth in the Premium Letter.

     “Provided Documents” means the Transaction Documents and any documents,
agreements, instruments, schedules, certificates, statements, cash flow
schedules, number runs or other writings or data furnished to Financial
Security by or on behalf of AmeriCredit, the Company, AFS Funding or Funding
Trust with respect to itself, its respective Subsidiaries, the Receivables or
the Transaction.

     “Purchase Agreement” means the Purchase Agreement, dated as of October 26,
2004, by and between the Company and Funding Trust.

     “Receivable” has the meaning provided in the Sale and Servicing Agreement.

I-5

 

     “Release of Security Interests” means the Release of Security Interests,
dated as of November 9, 2004, by JPMorgan Chase Bank, on behalf of the Lender
is releasing the security interest in the Receivables identified on Exhibit A
thereto and authorizing the filing of UCC financing statements to be filed in
such locations as are required to evidence the release of the security interest
in such Receivables.

     “Reportable Event” means any of the events set forth in Section 4043(b) of
ERISA or the regulations thereunder.

     “Representative” means Credit Suisse First Boston LLC, as representative
of the Underwriters.

     “Restrictions on Transferability” means, as applied to the property or
assets (or the income or profits therefrom) of any Person, in each case whether
the same is consensual or non-consensual or arises by contract, operation of
law, legal process or otherwise, any material condition to, or restriction on,
the ability of such Person or any transferee therefrom to sell, assign,
transfer or otherwise liquidate such property or assets in a commercially
reasonable time and manner or which would otherwise materially deprive such
Person or any transferee therefrom of the benefits of ownership of such
property or assets.

     “Sale and Servicing Agreement” means the Sale and Servicing Agreement
dated as of October 26, 2004 among the Trust, AmeriCredit Financial Services,
Inc., as Servicer, Funding Trust, as Seller, System & Services Technologies,
Inc., as Backup Servicer and JP Morgan Chase Bank, as Trust Collateral Agent.

     “Securities” means the Notes.

     “Securities Act” means the Securities Act of 1933, including, unless the
context otherwise requires, the rules and regulations thereunder, as amended
from time to time.

     “Securities Exchange Act” means the Securities Exchange Act of 1934,
including, unless the context otherwise requires, the rules and regulations
thereunder, as amended from time to time.

     “Servicer” means the Servicer, in its capacity as Servicer under the Sale
and Servicing Agreement.

     “S&P” means Standard & Poor’s Ratings Service, a division of McGraw-Hill
Corporation, and any successor thereto, and, if such corporation shall for any
reason no longer perform the functions of a securities rating agency, “S&P”
shall be deemed to refer to any other nationally recognized rating agency
designated by Financial Security.

     “Special Event” means the occurrence of any one of the following: (a) an
Event of Default under this Agreement has occurred and is continuing, (b) a
Cumulative Default Test Failure, Delinquency Test Failure or Cumulative Net
Loss Test Failure (each as defined in the Spread Account Agreement) has
occurred and is continuing, (c) any legal proceeding or binding arbitration is
instituted with respect to the Transaction, (d) any

I-6

 

governmental or administrative investigation, action or proceeding is
instituted that would, if adversely decided, result in a Material Adverse
Change in respect of AmeriCredit, the Company, Funding Trust or the
Receivables, or (e) Financial Security pays a claim under the Policy.

     “Spread Account Agreement” means the Spread Account Agreement, as amended
and restated as of May 11, 1998, and as further amended and restated as of
September 10, 2003 among Financial Security, Funding Trust, the collateral
agents named therein and the trustees specified therein, as the same may be
amended, supplemented or otherwise modified in accordance with the terms
thereof.

     “Subsidiary” means, with respect to any Person, any corporation of which a
majority of the outstanding shares of capital stock having ordinary voting
power for the election of directors is at the time owned by such Person
directly or through one or more Subsidiaries.

     “Term of this Agreement” shall be determined as provided in Section 4.01
of this Agreement.

     “Term Of The Policy” has the meaning provided in the Policy.

     “Transaction” means the transactions contemplated by the Transaction
Documents, including the transactions described in the Offering Document.

     “Transaction Documents” means this Agreement, the AmeriCredit 2004-D-F
Letter Agreement, the Trust Agreement, the Indenture, the Sale and Servicing
Agreement, the Underwriting Agreement, the Indemnification Agreement, the
Purchase Agreement, any Custodian Agreement, the Premium Letter, the Lockbox
Agreement, the Spread Account Agreement, the Funding Trust Agreement, the
Administration Agreement.

     “Trust” means AmeriCredit Automobile Receivables Trust 2004-D-F created by
the Trust Agreement.

     “Trust Agreement” means the Trust Agreement dated as of October 5, 2004,
as amended as of October 26, 2004 between Funding Trust and Wilmington Trust
Company as Owner Trustee.

     “Trust Property” has the meaning under the Sale and Servicing Agreement.

     “Underfunded Plan” means any Plan that has an Underfunding.

     “Underfunding” means, with respect to any Plan, the excess, if any, of (a)
the present value of all benefits under the Plan (based on the assumptions used
to fund the Plan pursuant to Section 412 of the Code) as of the most recent
valuation date over (b) the fair market value of the assets of such Plan as of
such valuation date.

I-7

 

     “Underwriters” means Credit Suisse First Boston LLC., UBS Securities LLC,
Barclays Capital Inc., Lehman Brothers Inc. and Morgan Stanley & Co.
Incorporated as underwriters.

     “Underwriting Agreement” means the Underwriting Agreement, dated as of
October 25, 2004 between the Company, Funding Trust and the Representative.

I-8

 

ANNEX I

TO

INSURANCE AND INDEMNITY AGREEMENT

FORM OF NOTE POLICY

 

 

APPENDIX A

TO INSURANCE AND INDEMNITY AGREEMENT

CONDITIONS PRECEDENT TO ISSUANCE OF THE POLICY

     (a) Payment of Premium and Expenses; Premium Letter. Financial Security
shall have been paid, a nonrefundable Premium and shall have been reimbursed,
for other fees and expenses identified in Section 3.2 of this Agreement as
payable at closing and Financial Security shall have received a fully executed
copy of the Premium Letter.

     (b) Transaction Documents. Financial Security shall have received a copy
of each of the Transaction Documents, in form and substance satisfactory to
Financial Security, duly authorized, executed and delivered by each party
thereto. Without limiting the foregoing, the provisions of the Sale and
Servicing Agreement relating to the payment to Financial Security of Premium
due on the Policy and the reimbursement to Financial Security of amounts paid
under the Policy shall be in form and substance acceptable to Financial
Security in its sole discretion.

     (c) Certified Documents and Resolutions. Financial Security shall have
received a copy of (i) the certificate of incorporation and bylaws of each of
AmeriCredit, the Company, and AFS Funding and a copy of the Certificate of
Trust and the Funding Trust Agreement of Funding Trust and (ii) the resolutions
of the Board of Directors of each of AmeriCredit, the Company and AFS Funding
and the resolution of the equity owners of Funding Trust, authorizing the
issuance of the Securities and the execution, delivery and performance by
AmeriCredit, the Company, AFS Funding and Funding Trust of the Transaction
Documents and the transactions contemplated thereby, certified by the Secretary
or an Assistant Secretary of AmeriCredit, the Company, AFS Funding and Funding
Trust, as the case may be (which certificate shall state that such certificate
of incorporation, bylaws and resolutions are in full force and effect without
modification on the Date of Issuance).

     (d) Incumbency Certificate. Financial Security shall have received a
certificate of the Authorized Officer, Secretary or an Assistant Secretary, as
the case may be, of each of the Owner Trustee, AmeriCredit, the Company, the
Representative and Funding Trust certifying the name and signatures of the
officers of the Owner Trustee, AmeriCredit, the Company, the Representative and
Funding Trust, as the case may be, authorized to execute and deliver the
Transaction Documents and that shareholder consent to the execution and
delivery of such documents is not necessary.

     (e) Representations and Warranties; Certificate. The representations and
warranties of each of AmeriCredit, the Company and Funding Trust in this
Agreement shall be true and correct as of the Date of Issuance with respect to
such Person as if made on the Date of Issuance and Financial Security shall
have received a certificate of appropriate officers of the Owner Trustee,
AmeriCredit, the Company and Funding Trust, as the case may be, to that effect.

 

 

     (f) Opinions of Counsel. Financial Security shall have received opinions
of counsel addressed to Financial Security and S&P in respect of the Trust, the
Owner Trustee, AmeriCredit, the Company, Funding Trust, the other parties to
the Transaction Documents and the Transaction in form and substance
satisfactory to Financial Security, addressing such matters as Financial
Security may reasonably request, and the counsel providing each such opinion
shall have been instructed by its client to deliver such opinion to the
addressees thereof.

     (g) Approvals, Etc. Financial Security shall have received true and
correct copies of all approvals, licenses and consents, if any, including,
without limitation, the approval of the shareholders of AmeriCredit and the
Company and the approval of the equity owners of Funding Trust required in
connection with the Transaction.

     (h) No Litigation, Etc. No suit, action or other proceeding,
investigation, or injunction or final judgment relating thereto, shall be
pending or threatened before any court or governmental agency in which it is
sought to restrain or prohibit or to obtain damages or other relief in
connection with any of the Transaction Documents or the consummation of the
Transaction.

     (i) Legality. No statute, rule, regulation or order shall have been
enacted, entered or deemed applicable by any government or governmental or
administrative agency or court which would make the transactions contemplated
by any of the Transaction Documents illegal or otherwise prevent the
consummation thereof.

     (j) Satisfaction of Conditions of Underwriting Agreement. All conditions
in the Underwriting Agreement to the Underwriters’ obligation to purchase the
Securities shall have been satisfied.

     (k) Issuance of Ratings. Financial Security shall have received
confirmation that the risk secured by the Policy constitutes an investment
grade risk by S&P and an insurable risk by Moody’s and that the Securities,
when issued, will be rated “Aaa” by Moody’s and “AAA” by S&P and Fitch.

     (l) Maintenance of Receivable Files. Financial Security shall have
received evidence satisfactory to it that the Receivable Files are being
maintained by and held in the custody of the Company, as Custodian, pursuant to
Section 3.3 of the Sale and Servicing Agreement.

     (m) Financial Security shall have received an executed copy of the Release
of Security Interest, in form and substance satisfactory to Financial Security.

     (n) The Trustee shall have received for filing, any amendments to, and/or
terminations of, UCC financing statements to be filed in such locations as
required to evidence the release of any Liens of the Lenders on certain of the
Receivables and other property.

     (o) No Default. No Default or Event of Default shall have occurred.

2

 

     (p) Intentionally Omitted.

     (q) Additional Items. Financial Security shall have received such other
documents, instruments, approvals or opinions requested by Financial Security
as may be reasonably necessary to effect the Transaction, including but not
limited to evidence satisfactory to Financial Security that all conditions
precedent, if any, in the Transaction Documents have been satisfied.

3

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