Document:

Exhibit 10.2

Exhibit 10.2

Execution Version

AMENDED AND RESTATED SERVICING AGREEMENT

THIS AMENDED AND RESTATED SERVICING AGREEMENT (this “Servicing Agreement”) dated as of this
18th day of June 2010, by and between AARON’S, INC., a Georgia corporation (“Sponsor”), and
SUNTRUST BANK, a Georgia banking corporation (the “Servicer”).

PREAMBLE

WHEREAS, the Sponsor and the Servicer are parties to that certain Servicing Agreement dated as
of May 28, 2004, as amended or modified prior to the date hereof (the “Existing Servicing
Agreement”);

WHEREAS, the Sponsor and the Servicer are entering into the Second Amended and Restated Loan
Facility Agreement and Guaranty, dated as of the date hereof (as hereafter amended or modified, the
“Loan Facility Agreement”), by and among Sponsor, Servicer and the other financial institutions
from time to time party thereto (together with SunTrust, the “Participants”), and in connection
with the Loan Facility Agreement, the Sponsor has requested that the Servicer make certain
modifications to the Existing Servicing Agreement, which the Servicer is willing to do subject to
the terms and conditions hereof;

WHEREAS, the Sponsor and the Servicer wish to enter into this Agreement to set forth their
understandings regarding such matters, all as more particularly set forth below;

NOW, THEREFORE, upon the terms and conditions hereinafter stated, and in consideration of the
mutual premises set forth above and other adequate consideration, the receipt and sufficiency of
which is hereby acknowledged, the parties, intending to be legally bound, hereby agree the Existing
Servicing Agreement is amended and restated as follows:

1. DEFINITIONS

In addition to the other terms defined herein, the following terms used herein shall have the
meanings herein specified (such meanings to be equally applicable to both the singular and plural
forms of the terms defined):

“Aaron’s Proprietary System” means Sponsor’s proprietary point of sale software
system, as modified from time to time, used by Sponsor and the Borrowers.

“ACH Authorization” means an authorization from a Borrower to automatically
debit Loan payments from a deposit account of such Borrower, substantially in the form of
Exhibit A.

“Agreement” means this Servicing Agreement, either as originally executed or as
it may hereafter be amended, restated, modified or supplemented from time to time.

“Approved Invoice” means an invoice for the aggregate purchase price of
Merchandise purchased by a Borrower with a purchase order approved by the Sponsor as
provided in this Agreement.

“Asset Disposition Invoice” shall have the meaning set forth in Section
2.5.

 

 

 

“Authorized Signatory” means an officer of the Sponsor named in the most recent
Certificate Regarding Authorized Signatories delivered to Servicer.

“Calculation Period” means, initially, the period commencing on June 18th, 2010
and ending on June 30, 2010 and thereafter, the period commencing on the last day of the
preceding Calculation Period and ending on the third Payment Date or Canadian Payment Date
(as applicable) thereafter.

“Canadian Payment Date” means the last day of each calendar month;
provided, however, if such day is not a Canadian Business Day, the next
succeeding Canadian Business Day which is also a Business Day.

“Commitment Letter” means a letter from Servicer to a potential Borrower named
in a Funding Approval Notice, substantially in the form of Exhibit C, whereby
Servicer agrees to establish a Loan Commitment in favor of such Franchisee upon the terms
and conditions set forth therein and in the Operative Documents.

“Corporate Authorization” means, with respect to any Borrower which is a
corporation, certifications as to authorized signatories and corporate action with respect
to the Loan in the form attached hereto as Exhibit D.

“Debt” means (i) indebtedness for borrowed money or for the deferred purchase
price of property or services (other than trade accounts payable on customary terms in the
ordinary course of business), (ii) financial obligations evidenced by bonds, debentures,
notes or other similar instruments, (iii) financial obligations as lessee under leases which
shall have been or should be, in accordance with GAAP, recorded as capital leases, and (iv)
obligations under direct or indirect guaranties in respect of, and obligations (contingent
or otherwise) to purchase or otherwise acquire, or otherwise to assure a creditor against
loss in respect of, indebtedness or financial obligations of others of the kinds referred to
in clauses (i) through (iii) above.

“Debt Service” means, for any particular Borrower and period, the aggregate
amount of all payments of principal (excluding any payments of principal required to be made
under this Servicing Agreement as a result of any Asset Disposition), interest and fees
required to be made by such Borrower with respect to its Debt (other than Debt of the
Borrower which is subordinated to the Loan Indebtedness owing to the Bank pursuant to a
subordination agreement in form and substance satisfactory to the Bank) during such period
to the extent that such Debt arises pursuant to such Borrower’s Loan Agreement or any other
financing arrangement with respect to Merchandise.

“Default Interest Rate” means the annual percentage interest rate applied to
any principal amount outstanding pursuant to a Loan Commitment not paid when due under the
terms of the applicable Loan Documents, which rate shall equal the sum of 2% per annum above
the Borrower Rate.

“Default Waiver Letter” means a waiver letter sent to any Borrower by Servicer
upon the request of Sponsor in the form attached hereto as Exhibit B.

“Financing Statement” means, with respect to a Loan, a document which among
other things, describes the Borrower and the Collateral, the proper filing of which perfects
a security

 

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interest in the Collateral described therein under the laws of the state or province in
which such document is filed.

“FCTA” means an account denominated in Canadian Dollars maintained on the books
of Servicer and subject to Servicer’s standard terms and conditions for such accounts.

“Funding Approval Notice” means a written notice to Servicer from Sponsor
setting forth the conditions of a proposed Loan Commitment, consistent with the requirements
therefor as set forth in this Agreement, and containing such information and in
substantially the form of Exhibit E.

“GAAP” shall mean generally accepted accounting principles in the United States
applied on a consistent basis when applied to US Borrowers and generally accepted accounting
principles in Canada applied on a consistent basis when applied to Canadian Borrowers.

“Legal Forms” shall have the meaning set forth in Section 2.2.

“Loan Account” means the internal bank loan account established by each
Borrower with the Servicer.

“Net Book Value” means, for any item of Merchandise, the cost of such
Merchandise less accumulated depreciation as calculated in accordance with the
Aaron’s Proprietary System.

“PAD authorization” means an authorization from a Borrower to automatically
debit Loan payments from a deposit account of such Borrower, held with a Canadian financial
institution, substantially in the form of Exhibit K.

“Payment Date” means shall mean, with respect to any US Loans, the last day of
each calendar month; provided, however, if such day is not a Business Day,
the next succeeding Business Day.

“Personal Guaranty” means any guaranty from a principal or member of a US
Borrower substantially in the form of Exhibit F or from a principal or member of a
Canadian Borrower substantially in the form of Exhibit L.

“Prime Rate” means the per annum rate of interest designated from time to time
by Servicer to be its prime rate, with any change in the rate of interest resulting from a
change in the Prime Rate to be effective as of the opening of business of Servicer on the
day of such change. The Prime Rate is a reference rate and does not necessarily represent
the lowest or best rate of interest that is being offered by Servicer to its borrowers.

“Servicing Fee” shall have the meaning set forth in Section 2.13.

“Sponsor’s Fee” shall have the meaning set forth in Section 2.13.

“Spousal Consent” shall mean any agreement provided by the spouse of any Person
executing a Personal Guaranty to the extent such spouse has not personally executed a
Personal Guaranty, to be substantially in the form provided by the Servicer.

“State” means any State of the United States of America and the District of
Columbia.

 

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“Store Opening Information Sheet” shall mean a document substantially in the
form of Exhibit G, completed by Sponsor with respect to a Borrower.

“Subordination Agreement” shall have the meaning set forth in Section
2.2(e).

“SWIFT” means Society for Worldwide Interbank Financial Telecommunication.

“Tangible Net Worth” means, with respect to any Borrower as of any date of
determination, the excess of the total assets of such Borrower over the Total Liabilities of
such Borrower, determined in accordance with GAAP consistently applied, excluding from the
calculation of total assets the notes receivables from shareholders of such Borrower and
including in such calculation of total assets the franchise fees, as shown on the balance
sheet of such Borrower as of such date.

“Territory” means any territory or province of Canada.

“Total Liabilities” means, with respect to any Borrower, as of any date of
determination, total liabilities determined in accordance with GAAP consistently applied,
but excluding therefrom, Debt of such Borrower which is subordinated to the Loan
Indebtedness owing to Servicer pursuant to a Subordination Agreement.

The above definitions apply equally to both the singular and the plural of the terms defined.
All terms used herein and not otherwise shall have the meaning ascribed to such terms in the Loan
Facility Agreement.

2. PRE-FUNDING MATTERS; CLOSING OF LOANS

	 	2.1	 	Approval Process.

(a) In the event that Sponsor desires that Servicer establish a Loan
Commitment under the Operative Documents, Sponsor shall forward to Servicer an
appropriate Funding Approval Notice no later than thirty (30) days prior to the
anticipated Closing Date of such Loan Commitment. Such Funding Approval Notice
shall indicate whether the requested Loan Commitment is a Line of Credit
Commitment, a Revolving Commitment or a Term Loan Commitment and shall contain the
following information:

(i) the Franchisee’s legal name and State or Territory of organization (or
whether such Franchisee is organized under Canadian federal law);

(ii) the amount of the Loan Commitment;

(iii) the applicable interest rate for such Loan;

(iv) the amount of the applicable commitment fee for such Loan Commitment,
which shall not exceed 100 basis points per annum;

(v) a copy of the Franchisee’s executed franchise application authorizing
release of all information set forth therein or delivered in connection therewith
to

 

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Servicer;

(vi) the Franchisee’s federal tax identification number, if applicable;

(vii) the legal address(es) of the Franchisee’s residence or principal place
of business, each store location, and the site(s) where any Collateral to be
pledged as security for the Loan is stored, together with any other corporate names
or tradenames used by the Franchisee in the last five (5) years for Franchisees
organized in the United States or all predecessor corporate names or tradenames
used by the Franchisee since the initial incorporation of the oldest predecessor
corporation for Franchisees organized in Canada;

(viii) if the Franchisee is a corporation, copies of the Franchisee’s
articles or certificate of incorporation (or equivalent), certified by the
Secretary of State (or equivalent) of its jurisdiction of organization (or, if the
Secretary of State (or equivalent) does not generally provide such copies,
certified by the corporate secretary of the Borrower), copies of the Franchisee’s
by-laws and current incumbency certificate, if the Franchisee is a partnership, a
copy of the current partnership agreement, if the Franchisee is a limited liability
company, a copy of the current operating or limited liability company agreement and
if the Franchisee is a sole proprietor, a Statement of Sole Proprietorship (or
equivalent) in the form provided by Servicer;

(ix) good standing certificate (or equivalent) from the Secretary of State (or
equivalent) of the state or territory in which the Franchisee is organized or
formed;

(x) for any Revolving Commitment, US Term Loan Commitment or Canadian Term
Loan Commitment, a detailed description of the financial covenants to be included
in the Loan Agreement, including any defined terms used in such financial covenants

(xi) for any US Term Loan Commitment or Canadian Term Loan Commitment, the
date on which payments of principal should begin; and

(xii) such other information as Servicer shall reasonably request, including,
without limitation, a listing of all Subsidiaries of the Franchisee, a listing of
all Guarantors and a listing of all Permitted Liens.

The Funding Approval Notice shall contain a statement that Sponsor has approved the
Franchisee for a franchise license and for participation in the Franchisee Loan Program and
shall also state that the Sponsor consents to the liens in favor of Servicer provided for
therein.

(b) Upon receipt of the Funding Approval Notice, Servicer shall, as soon as practicable,
notify Sponsor if the Funding Approval Notice fails to contain any of the items described in the
preceding Section, or if Servicer has any questions relating to such Funding Approval Notice or the
information submitted therewith; and

(c) Sponsor shall forward to Servicer a completed Store Opening Information Sheet (i)
contemporaneously with the Funding Approval Notice if the Franchisee is already a Borrower and (ii)
at least ten (10) Business Days prior to the anticipated Closing Date if the Franchisee is not
presently a Borrower, in each case together with a duly executed landlord’s waiver for each leased
location listed on

 

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the Store Opening Information Sheet where the financed Merchandise is located, substantially
in the form of Exhibit H.

If Sponsor fails to deliver any of the foregoing items to the Servicer, the Servicer shall have no
obligation to maintain such items in its files or to notify Sponsor that such items have not been
received by Servicer.

	 	2.2	 	Loan Documentation; Collateral.

Upon receipt of a completed Store Opening Information Sheet, Servicer shall proceed to
document the Loan and shall forward such documentation to the applicable Franchisee for
signature within ten (10) Business Days after receipt of the Store Opening Information.
Each Loan made pursuant to this Agreement shall be evidenced by the following documentation
in such form as is set forth in the Exhibits to the Operative Documents for the applicable
Facility (the “Legal Forms”), with such modifications as Sponsor and Servicer may agree upon
from time to time in accordance with the terms hereof:

(a) the Loan Agreement and, if applicable, a security agreement;

(b) the Master Note;

(c) a Personal Guaranty of each Person specified as a Guarantor in the Funding Approval
Notice for such Loan, and, if requested by Sponsor and to the extent not prohibited by law,
the spouse of such Person; provided, however, that if such spouse is not
providing a Personal Guaranty, a Spousal Consent will be part of the Legal Forms;

(d) a Subordination Agreement from each other debtholder of the Franchisee
substantially in the form of Exhibit I (each, a “Subordination Agreement”);

(e) suitable Financing Statements to enable Servicer to perfect the security interest
granted to it in the personal property of the Franchisee under the Loan Agreement;

(f) a Corporate Authorization; and

(g) an ACH Authorization or a PAD Authorization, as applicable.

To the extent that any of the foregoing items (other than the Loan Agreement or Master Note)
have been provided by the relevant Franchisee in connection with a prior Loan, Sponsor may
waive the requirement that such documents be prepared by the Servicer or executed by the
Franchisee. At the request of the Sponsor set forth in the Funding Approval Notice, the
Servicer will prepare a Commitment Letter and forward such Commitment Letter with the Legal
Forms to the Franchisee.

In addition, Servicer shall engage a nationally recognized service to perform lien searches
in the jurisdictions listed by the Sponsor in the Funding Approval Notice. Prior to the
Closing Date, Servicer shall prepare appropriate Financing Statements to be filed in
connection with the Loan and forward the same to the Franchisee for execution to the extent
required by applicable law. The Franchisee shall, to the extent required by applicable law,
promptly execute and return such financing statements to Servicer for filing. Upon receipt
from Franchisee, the Servicer shall promptly file all such financing statements in the
appropriate filing office.

 

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Servicer shall prepare and shall execute the Loan Documents where required and forward
copies of the executed documents to the Franchisee and, if requested by the Sponsor (whether
at the time of closing or at a later date), to the Sponsor. Franchisee shall execute and
deliver the Loan Documents to the Servicer prior to the funding of the initial Advance to
such Borrower. In addition, Sponsor shall cause the Borrower to forward or to have
forwarded to Servicer a Certificate of Insurance evidencing the Borrower’s ownership of
liability insurance and of property and casualty insurance in an amount not less than the
greater of (i) the Loan Commitment, or (ii) the full replacement cost of the Collateral,
which certificate shall name Servicer as sole loss payee and additional insured and shall
also provide that Servicer shall receive thirty (30) days’ prior written notice at

Aaron’s Program Manager

SunTrust Bank

Program Lending

303 Peachtree Street, N.E., 2nd Floor

Mail Code 1802

Atlanta, Georgia 30308

of any lapse, termination or cancellation of the insurance policies referenced on such
certificate. The Servicer shall have no obligation to obtain such Certificate of Insurance
or to notify Sponsor of any Borrower’s failure to deliver such Certificate of Insurance or
to notify Sponsor of the contents thereof.

	 	2.3	 	Interest on Loans; Terms of Loan Agreements.

(a) Each of the Loans shall bear interest at the Borrower Rate specified by the Sponsor
in the applicable Funding Approval Notice and interest on the Loans shall be calculated
based upon the actual number of days elapsed in a 360-day year.

(b) Each of the Loan Agreements shall require that the applicable Borrower
thereunder comply with the following financial covenant[s]:

[(i) Rental Revenue to Debt Service. Commencing on the first day of
the calendar quarter in which the 25th month following the Opening Date of the
first store location of the Borrower occurs and measured as of the last day of the
calendar quarter in which such 25th month occurs and on the last day of each
calendar quarter thereafter, the ratio of the Borrower’s Rental Revenue to Debt
Service for such quarter shall not be less than 2.2:1.0;]
1

(ii) Debt to Rental Revenue. [Commencing on the first day of the
calendar quarter in which the first day of the 19th month following the Opening
Date of the first store location of Borrower occurs and measured as of the last day
of the calendar quarter in which such 19th month occurs and on the last day of each
calendar quarter thereafter,][On the last day of each calendar quarter] the ratio
of Borrower’s Debt to Borrower’s Rental Revenue, shall not exceed [_____]:1.0.
2

 

	 	 	 
	1	 	Note: This covenant will not apply in the case of any
Borrowers who have Revolving Loans, US Term Loans or Canadian Term Loans.

	 
	2	 	Note: This covenant will apply and be tested on last day
of each calendar quarter and not be tied to any Opening Date of store locations
in the case of any Borrowers who have Revolving Loans, US Term Loans or
Canadian Term Loans. Covenant levels for this covenant will be established by
Sponsor in the applicable Loan Agreement for each Borrower.

 

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To the extent any of the financial covenants set forth above in this Section
2.3(b) are calculated based upon the Opening Date of a store location, the
financial information from store locations that have not reached the Opening Date
anniversary incorporated into such covenants shall be excluded from such
calculations. Debt Service and Debt attributable to such locations and deducted
from the final calculations shall be deducted on a pro rata basis calculated by
dividing such stores’ aggregate Net Book Value of Merchandise by the Net Book Value
of Merchandise for all store locations. The financial covenants shall otherwise be
calculated on a consolidated basis as to all store locations.

(c) Reserved.

(d) Each of the Loan Agreements shall also provide that the applicable Borrower, to the
extent such Borrower has a Line of Credit Loan, will submit to Sponsor on a quarterly basis
a Compliance Certificate, in the form attached as Exhibit C to the Loan Agreement,
presenting the calculation of the financial covenants set forth above, together with
monthly, quarterly and annual financial statements, and personal financial statements of all
Guarantors.

(e) The Sponsor shall deliver to the Servicer (x) a quarterly inventory reconciliation
report showing the amount of Inventory of each Borrower by store as of the last day of each
calendar quarter and (y) a quarterly revenue report showing the monthly and quarterly
revenues of each Borrower by store during each calendar quarter.

	 	2.4	 	Use of Loan Proceeds; Mechanics of Loan Program for Line of Credit
Loans.

(a) No later than fifteen (15) days after Servicer’s receipt of the executed
Loan Documents, Servicer shall (i) establish a DDA Account and a Loan Account for
any US Franchisee and (ii) establish a FCTA and a Loan Account for any Canadian
Franchisee.

(b) Upon establishment of the above-referenced accounts and receipt of the
above-referenced Loan Documents, duly executed by the Borrower and each Guarantor,
and if requested by Sponsor in writing, confirmation by Servicer of its
first-priority security interest in the Collateral, Servicer shall notify the
Borrower and Sponsor that the Borrower may request Advances pursuant to the Line of
Credit Commitment; provided, however, that the minimum amount of
each Advance shall be $500. Each Advance shall be made by Servicer for the sole
purpose of (i) honoring requests from US Borrowers, made through the Aaron’s
Proprietary System, for ACH transfers to suppliers of Merchandise in payment of
Approved Invoices, for payment of state sales and use taxes and for payment of
freight charges to the extent Sponsor consents thereto or (ii) honoring requests
from Canadian Borrowers, made through the Sponsor by fax, email or other electronic
forms of notification to the Servicer by 12:00 Noon on the last Business Day
immediately prior to the 10th or 25th day of each month, for SWIFT transfers to
suppliers of Merchandise in payment of Approved Invoices and to the extent
permitted by Sponsor, to pay sales and use taxes and freight charges. The
Borrowers shall not be authorized to use the DDA Account or FTCA for any other
purpose.

 

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(c) Each Borrower will submit purchase order requests for Merchandise to
Sponsor. In the event that the purchase order is authorized pursuant to the
Franchise Agreement, Sponsor will prepare the purchase order and submit the same to
the appropriate supplier requested by the Borrower. The supplier will be
instructed to ship all Merchandise directly to the Borrower and the Borrower will
be responsible for inspecting all Merchandise and resolving all disputes regarding
the Merchandise with such supplier. The supplier will invoice the Borrower for
such Merchandise in accordance with normal industry practice. When the Borrower
wishes to pay such invoice, the Borrower, subject to availability of its Loan
Commitment and the minimum borrowing threshold, shall pay such invoice by directing
Servicer, through the Aaron’s Proprietary System, to pay such invoice by means of
an ACH transfer from its DDA Account if such Borrower is a US Borrower or by
requesting that Sponsor, through fax, email or other electronic forms of
notification by 12:00 Noon on the last Business Day immediately prior to the 10th
or 25th day of each month, direct the Servicer to pay such invoice by means of a
SWIFT transfer from its FCTA if such Borrower is a Canadian Borrower. Any
directions for ACH transfers inputted by the US Borrowers into the Aaron’s
Proprietary System prior to 12:00 Midnight (Atlanta, Georgia time) on any Business
Day, shall be forwarded to Servicer pursuant to Sponsor’s existing ACH access by
3:30 p.m. (Atlanta, Georgia time) on the next Business Day and, if properly
forwarded to Servicer by Sponsor shall be paid by Servicer no later than the second
Business Day thereafter, unless Sponsor is otherwise notified by Servicer. Any
directions for SWIFT transfers transmitted by the Sponsor on behalf of the Canadian
Borrowers prior to 12:00 noon (Atlanta, Georgia time) on the last Business Day
immediately prior to the 10th or 25th day of each month shall be paid by Servicer
no later than the next Business Day thereafter, unless Sponsor is otherwise
notified by Servicer.

(d) Sponsor hereby acknowledges and agrees that Servicer has no ability to
halt an ACH transfer upon the inputting of such transfer request by Sponsor from
the Aaron’s Proprietary System into the ACH system (other than the ability to
retrieve ACH transfers which are sent to the wrong party or otherwise manifestly
erroneous as provided in the ACH Agreement with Sponsor) and Sponsor accepts full
responsibility for any overadvance created by such inputting of information. Upon
receipt of the request for an ACH transfer or SWIFT Transfer, as applicable,
Servicer shall honor such request by making an Advance pursuant to the Loan
Commitment in the amount of such request into the Borrower’s DDA Account or FTCA,
as applicable, and automatically forwarding such amount to the supplier by means of
an ACH transfer or SWIFT transfer, as applicable in accordance with the
instructions of the Borrower passed onto Servicer by Sponsor.

(e) Nothing set forth herein shall be deemed to vary the terms and conditions of the
MicroACH Service Agreement by and between Servicer and Sponsor.

	 	2.5	 	Tracking of Collateral for Borrowers; Asset Dispositions of Borrowers with
Lines of Credit.

All Merchandise financed by Servicer must be serialized via the Aaron’s Proprietary System
for appropriate reconciliation of Advances and receipt of Merchandise and for purposes of
tracking Asset Dispositions. Each Borrower shall be obligated to furnish serial numbers for
all

 

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Merchandise purchased directly to Sponsor on a weekly basis (and, if available, on a daily
basis) by transmittal of Borrower’s receiving report (containing Aaron’s Proprietary System
numbers) directly to Sponsor on the Aaron’s Proprietary System. As set forth more fully
below, Sponsor will maintain and track such information as agent for Servicer, and Servicer
shall at all times have access to such information.

Any Borrower with a Line of Credit shall immediately report any Asset Disposition to Sponsor
by means of the Aaron’s Proprietary System, such information to include the Aaron’s
Proprietary System numbers, and if assigned, the serial numbers of the Merchandise subject
to the Asset Disposition, the Net Book Value of such Merchandise and the proceeds received
by the Borrower therefrom. Sponsor on a monthly basis shall transmit all such information
to Servicer in summary form to be received by Servicer no later than the twelfth Business
Day of each month. Based solely on such information provided by Sponsor to Servicer,
Servicer shall prepare and forward to each US Borrower, on a monthly basis, an invoice for
payment of the aggregate outstanding amount of the Line of Credit Loan in an amount equal to
the Net Book Value of the Asset Dispositions during the preceding month not applied to
Advances made during such month (the “Asset Disposition Invoice”), unless Sponsor
notifies the Servicer in writing that it wishes to waive the payment reflected in the Asset
Disposition Invoice, which notice must be received by the Servicer at least twelve (12)
Business Days prior to the date that the Asset Disposition Invoice is sent. Based solely
on such information provided by Sponsor to Servicer, Servicer shall include Net Book Value
of the Asset Dispositions during the preceding month not applied to Advances made during
such month in the monthly invoice for Canadian Borrowers. If the Servicer receives such
notice in writing from Sponsor at least twelve (12) Business Days prior to the date that the
Asset Disposition Invoice is otherwise to be sent, the Servicer agrees to notify the
applicable Borrower that the “Asset Disposition Prepayment” required under its Loan
Agreement is waived. Otherwise, the Asset Disposition Invoice shall be forwarded to the
Borrower by Servicer by the 15th day of each calendar month for US Borrowers and the
Business Day next succeeding the 25th day of each calendar month for Canadian
Borrowers and payment thereof shall be due on the next succeeding Payment Date or Canadian
Payment Date (as applicable).

	 	2.6	 	Amortization and Payment of Line of Credit Loans.

No more than twelve (12) Business Days after the last day of each Calendar Month, Sponsor
shall determine and report to Servicer the aggregate amount of (i) the eighteen (18) month
advances made to each Borrower, (ii) the twenty-four (24) month advances made to each
Borrower and (iii) the Asset Dispositions made by each Borrower during such month. Upon
receipt of the foregoing report, Servicer shall determine the aggregate amount of Advances
made to each Borrower during such month and shall subtract therefrom payments received by
Servicer from such Borrower with respect to Asset Dispositions made since the cut-off date
for the last monthly invoice to such Borrower. The remaining principal amount of Advances
made during such month shall be amortized (in accordance with a straight-line amortization
schedule) in twenty-four (24) equal payments of principal due and payable on the Canadian
Payment Dates for Advances under a Canadian Line of Credit Commitment and in eighteen (18)
or twenty-four (24) (as appropriate) equal payments of principal due and payable on the
Payment Dates for Advances under a US Line of Credit Commitment. On the fifteenth (15th)
day of each calendar month, Servicer shall mail to each US Borrower a detailed bill setting
forth the total amount of principal and interest due and summarizing all account activity
during the preceding month. On the Business Day next succeeding the twenty-fifth
(25th) day of each calendar month, Servicer shall mail, email or fax to each
Canadian Borrower a detailed bill setting forth the total amount of principal and interest
due and the Net Book Value of the Asset Dispositions during the preceding month not applied
to

 

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Advances made during such month and summarizing all account activity during the preceding
month. Payments of such principal and interest amount shall be due and payable on the
Payment Dates or Canadian Payment Dates (as applicable). Servicer shall have the exclusive
right to collect and receive all such payments on the Loans from the Borrowers which are due
and owing to Servicer. In the event that Sponsor receives any such payment with respect to
the Loans pursuant to the Franchisee Loan Program (other than with respect to Loans
purchased by Sponsor or where Sponsor has been subrogated to the rights of Servicer pursuant
to the terms of the Sponsor Guaranty), such payments shall be accepted by Sponsor as agent
for Servicer and Sponsor shall immediately endorse and forward the same to Servicer.

	 	2.7	 	Prepayment of Line of Credit Loans.

Each US Borrower shall have the right to prepay its Loan in whole or in part upon at least
two (2) Business Days’ prior notice to Servicer. Each Canadian Borrower shall have the
right to prepay its Loan in whole or in part on a Canadian Payment Date upon at least two
(2) Business Days’ prior notice to Servicer. Partial prepayments of any Loan (other than
proceeds of Asset Dispositions which shall be applied as set forth in Section 2.5)
shall be applied to reduce the current month’s Advance(s) to such Borrower with any excess
prepayment applied to unpaid principal payments of the Loan in inverse order of maturity.

	 	2.8	 	Use of Loan Proceeds; Mechanics of Loan Program for Revolving Loans and
Term Loans.

(a) Following the receipt of the executed Loan Documents with respect to a proposed
Borrower, but prior to the Closing Date of the proposed Loan Commitment, Servicer
shall (i) establish a DDA Account (unless the US Franchisee has only a Term loan)
and a Loan Account for any US Franchisee and (ii) establish a FCTA (unless the
Canadian Franchisee has only a Term Loan) and a Loan Account for any Canadian
Franchisee.

(b) Upon establishment of the above-referenced accounts and receipt of the
above-referenced Loan Documents, duly executed by the Borrower and each Guarantor,
and if requested by Sponsor, confirmation by Servicer of its first-priority
security interest in the Collateral, Servicer shall notify the relevant Borrower
and Sponsor that the Borrower may request Advances pursuant to the US Revolving
Commitment; provided, however, that the minimum amount of each
Advance shall be $500. Each Advance shall be made by Servicer for the sole
purposes of (i) honoring requests from any US Borrower, made through the Aaron’s
Proprietary System, for ACH transfers to suppliers of Merchandise in payment of
Approved Invoices, and (ii) honoring requests from any US Borrower for Advances
made via ACH transfers to an operating account or other location specified by such
Borrower (and granted a vendor identification number by Sponsor) for working
capital purpose. The Borrowers shall not be authorized to use the DDA Account or
FCTA for any other purpose. All Term Loans shall be disbursed in a single advance
on the date agreed to by the Borrower and the Servicer via a wire transfer or a
SWIFT transfer to an operating account or other location specified by such
Borrower.

 

11

 

(c) Each Borrower with a Revolving Commitment will submit purchase order requests
for Merchandise to Sponsor. In the event that the purchase order is authorized
pursuant to the Franchise Agreement, Sponsor will prepare the purchase order and
submit the same to the appropriate supplier requested by the Borrower. The
supplier will be instructed to ship all Merchandise directly to the Borrower and
the Borrower will be responsible for inspecting all Merchandise and resolving all
disputes regarding the Merchandise with such supplier. The supplier will invoice
the Borrower for such Merchandise in accordance with normal industry practice.
When the Borrower wishes to pay such invoice, the Borrower, subject to availability
of its Loan Commitment and the minimum borrowing threshold, shall pay such invoice
by directing Servicer, through the Aaron’s Proprietary System, to pay such invoice
by means of an ACH transfer from its DDA Account if such Borrower is a US Borrower
or by requesting that Sponsor, through fax, email or other electronic forms of
notification by 12:00 Noon on the last Business Day immediately prior to the 10th
or 25th day of each month, direct the Servicer to pay such invoice by means of a
SWIFT transfer from its FCTA if such Borrower is a Canadian Borrower. Any
directions for ACH transfers inputted by the US Borrowers into the Aaron’s
Proprietary System prior to 12:00 Midnight (Atlanta, Georgia time) on any Business
Day, shall be forwarded to Servicer pursuant to Sponsor’s existing ACH access by
3:30 p.m. (Atlanta, Georgia time) on the next Business Day and, if properly
forwarded to Servicer by Sponsor shall be paid by Servicer no later than the second
Business Day thereafter, unless Sponsor is otherwise notified by Servicer. Any
directions for SWIFT transfers faxed by the Canadian Borrowers prior to 12:00 Noon
(Atlanta, Georgia time) on the last Business Day immediately prior to the 10th or
25th day of each month shall be paid by Servicer no later than the next Business
Day thereafter, unless Sponsor is otherwise notified by Servicer.

(d) Sponsor hereby acknowledges and agrees that Servicer has no ability to halt an
ACH transfer upon the inputting of such transfer request by Sponsor from the
Aaron’s Proprietary System into the ACH system (other than the ability to retrieve
ACH transfers which are sent to the wrong party or otherwise manifestly erroneous
as provided in the ACH Agreement with Sponsor) and Sponsor accepts full
responsibility for any overadvance created by such inputting of information and has
agreed to indemnify Servicer and Participants therefore pursuant to the terms of
the Loan Facility Agreement. Upon receipt of the request for an ACH transfer or a
SWIFT transfer (as applicable), Servicer shall honor such request by making an
Advance pursuant to the Loan Commitment in the amount of such request into the
Borrower’s DDA Account or FTCA, as applicable, and automatically forwarding such
amount to the supplier by means of an ACH transfer or SWIFT transfer, as
applicable, in accordance with the instructions of the Borrower passed onto
Servicer by Sponsor.

(e) Nothing set forth herein shall be deemed to vary the terms and conditions of the
MicroACH Service Agreement by and between Servicer and Sponsor.

	 	2.9	 	Payments of Revolving Loans and US Term Loans and Canadian Term Loans;
Borrowing Base.

 

12

 

All outstanding Advances with respect to each Revolving Commitment, US Term Loan Commitment
or Canadian Term Loan Commitment shall be due and payable in full on the Maturity Date of
such Loan, if not sooner accelerated in accordance with the terms of the applicable Loan
Documents. In addition, the outstanding Advances pursuant to each Revolving Commitment
shall not exceed the Franchisee Borrowing Base for such Borrower, as determined by Sponsor
on the fifth Business Day of each month (as determined on the last day of the preceding
calendar month) and reported to Servicer on such date. Servicer shall be entitled to rely
upon the calculation of the Franchisee Borrowing Base for each Borrower submitted by Sponsor
for all purposes hereunder. Upon receipt of the Franchisee Borrowing Base, Servicer shall
input such information into Servicer’s loan records to be effective as of the date which is
two Business Days after receipt of such information. The statements prepared to be
delivered to each Borrower with respect to the next Payment Date shall be prepared requiring
a repayment of any Advances outstanding on the fifth Business Day of such month in excess of
the relevant Franchisee Borrowing Base as delivered to Servicer by Sponsor on such date. In
addition, however, Servicer, on the date which is two Business Days after receipt of such
calculation from Sponsor, shall notify the Borrowers in writing (including facsimile) of the
new Franchisee Borrowing Base for such Borrower and shall require that such Borrower repay
on the next Payment Date any additional Advances made since the date of the preparation of
the statement for such Payment Date if necessary to avoid any overadvance as of such date.
Upon the earlier of one (1) Business Day after notice from the Sponsor to the Servicer or
the next Payment Date, each Borrower shall prepay its outstanding Advances in excess of the
relevant Franchisee Borrowing Base.

	 	2.10	 	Prepayment of Revolving Loans, US Term Loans and Canadian Term Loans.

Each US Borrower shall have the right to prepay its Loan in whole or in part upon at
least two (2) Business Days’ prior notice to Servicer. Each Canadian Borrower shall have
the right to prepay its Loan in whole or in part on a Canadian Payment Date upon at least
two (2) Business Days’ prior notice to Servicer.

	 	2.11	 	Default Rate of Interest.

If any Borrower shall fail to pay on the due date therefor (subject to any applicable grace
period), whether by acceleration or otherwise, any principal owing by such Borrower under
any of the Loan Documents, then interest shall accrue on such unpaid principal from the due
date until and including the date on which such principal is paid in full at a rate of
interest equal to the Default Rate.

	 	2.12	 	Legal Expenses.

In the event that any requested Loan does not close, Servicer shall charge Sponsor for its
reasonable out-of-pocket expenses arising from its review or preparation of the initial
draft of the Loan Documents, Financing Statement filings and searches. In the event the
Loan closes, Servicer shall be entitled to charge the Borrower for its reasonable
out-of-pocket expenses incurred in connection with the closing of the Loan, including all
documentary stamp tax, filing fees, lien search costs and recording costs. In the event
that Servicer has not received payment from any Borrower for the expenses permitted in this
Section 2.12 after diligent collection efforts, Sponsor shall pay Servicer such
expenses, and Servicer shall assign to Sponsor any rights it may have against such Borrower
for the payment of such expenses.

 

13

 

	 	2.13	 	Servicing Fee and Sponsor’s Fee.

Servicer shall be entitled to a servicing fee for each Payment Period equal to the amount
specified in the Fee Letter (“Servicing Fee”), and Sponsor shall be entitled to the
amounts specified in the Fee Letter (the “US Sponsor’s Fee” and the “Canadian
Sponsor’s Fee” and collectively the “Sponsor’s Fee”) to the extent received by
Servicer.

3. SERVICING OF LOANS

	 	3.1	 	Notice of Loan
Defaults.

(a) Within fifteen (15) days after the occurrence of a Loan Payment Default, Servicer
shall send a notice of such Loan Payment Default to the applicable Borrower pursuant to
Section 3.3(f) and notice to Sponsor pursuant to Section 3.2(i).

(b) Following the sending of such notice of Loan Payment Default, Servicer shall as
soon as is practicable, provide Sponsor with such other information relating to the
Defaulted Borrower and the Defaulted Loan as Sponsor requests.

(c) Servicer shall not be required to take any remedial action against any Defaulted
Borrower under a Defaulted Loan and shall not be entitled to take any remedial action during
any applicable Response Period except as expressly provided in the Loan Facility Agreement
or hereunder.

(d) Sponsor shall have sole responsibility (and Servicer shall have no responsibility)
for monitoring the Borrowers for Loan Defaults other than Loan Payment Defaults, including
without limitation, reviewing the Compliance Certificates and financial statements to
determine compliance with the financial covenants. Sponsor shall have the right to waive
any Loan Default without the consent of Servicer; provided, however, that
(i) Sponsor may only waive Loan Payment Defaults if Sponsor simultaneously cures such Loan
Payment Defaults, (ii) Sponsor may not waive more than two consecutive Loan Payment Defaults
for any Loan or more than four Loan Payment Defaults for any one Loan during any four-year
period, (iii) Sponsor may not waive any Loan Default arising from the bankruptcy or
insolvency of a Borrower or any Guarantor of such Loan, or the appointment of a receiver,
trustee, custodian or similar fiduciary for such Borrower or Guarantor, or the assignment
for the benefit of creditors or the seeking of relief from creditors under applicable law by
such Borrower or Guarantor, or the offering of settlement or composition to the unsecured
creditors of such Borrower or Guarantor generally, (iv) Sponsor may not waive any Loan
Default arising from the termination (or non-renewal) of any Franchisee Agreement, of which
Sponsor agrees to give prompt notice to the Servicer, and (v) Sponsor may not waive a
default arising based upon the action or inaction of the Sponsor or any of its Subsidiaries.

	 	3.2	 	Servicing and
Administration of Loans.

Servicer shall service and administer the Loans in accordance with the terms of this
Agreement and its usual practices and procedures for loans of similar size and structure as
determined by Servicer in its sole and absolute discretion. Notwithstanding the foregoing,
so long as Sponsor is not in default hereunder and has a continuing obligation pursuant to
the Loan Facility Agreement

 

14

 

and this Agreement, Servicer shall be responsible for the following duties in connection
with the service and administration of the Loans:

(a) making of Advances pursuant to each Loan Commitment as set forth above;

(b) maintenance of files containing the Loan Documents forwarded to Servicer by Sponsor
or a Borrower; provided, however, that the Servicer shall have no
responsibility for maintaining any documents (including, without limitation, landlord
waivers, legal descriptions, leases or certificates of insurance) that are not actually
delivered to the Bank and shall have no obligation to notify the Sponsor that it has not
received any items other than the Loan Documents prepared by Servicer and sent to any
Franchisee;

(c) at the request of the Sponsor, review of the Loan files and give notice to Sponsor
of any missing Loan Documents;

(d) receipt of loan payments via check, ACH wire transfer, pre-authorized debits, or
SWIFT transfer from the Borrowers and maintenance of adequate records of such payments (with
the understanding that any ACH debit or pre-authorized debit for an Account of a Canadian
Borrower made by Servicer which is rejected will be reinitiated only once);

(e) notification to each US Borrower, by deposit into regular U.S. Mail, ten (10) days
prior to each Payment Date, of a notice that the installment is coming due on such Payment
Date, if any, and the amount of interest due on such date (or the amount that will be
debited in the case of a Borrower who has authorized ACH debits or SWIFT transfers);

(f) notification to each Canadian Borrower, by mail, email or fax, on the Business Day
next succeeding the twenty-fifth (25th) day of each calendar month, by means of a
detailed bill setting forth the total amount of principal and interest due and the Net Book
Value of the Asset Dispositions during the preceding month not applied to Advances made
during such month and summarizing all account activity during the preceding month (or the
amount that will be debited in the case of a Borrower who has executed a PAD authorization
or authorized SWIFT transfers).

(g) notification to such US Borrower, by deposit into regular U.S. Mail, ten (10) days
after the Payment Date with respect to any installment, of a reminder notice that
installment has not been received or notification to such Canadian Borrower, by email or
fax, ten (10) days after the Canadian Payment Date with respect to any installment, of a
reminder notice that installment has not been received

(h) within five (5) days from the date an installment is thirty (30) days delinquent,
notification to such Borrower, by mailing by registered U.S. Mail, of a letter demanding
immediate payment of the past due amount of principal and interest to avoid further
collection action, with a copy of such letter to be simultaneously delivered to Sponsor;

(i) on each Business Day on which an Advance is made, notification to Sponsor by
telecopy, of a report at the end of such Business Day summarizing the loan activity on such
day and setting forth the available balance of the relevant Loan Commitment;

(j) notification to Sponsor on weekly basis of all Defaulted Loans pursuant to a weekly
delinquency report in the form of Exhibit J, with such report to list all Loans
which are

 

15

 

fifteen (15) days or more past due and provide (1) the amount past due, (2) the total
principal outstanding, and (3) the number of days past due;

(k) delivery to the Borrowers with Revolving Commitments within two Business Days after
receipt of the calculation of the Franchisee Borrowing Base from Sponsor, of the amount of
such Franchisee Borrowing Base and any additional required payments by the Borrower on the
next Payment Date; and

(l) delivery to Sponsor of the “Quarterly Servicing Report” required by the Fee Letter
and delivery to the Sponsor and the Participants of the Monthly Servicing Report and the
Quarterly Servicing Report required by the Loan Facility Agreement.

	 	3.3	 	Waiver of Loan Defaults. Sponsor may waive any financial covenant Loan
Default of a Borrower by sending to the Servicer for execution a Default Waiver Letter,
which Servicer agrees to execute and mail to the appropriate Borrower if such Default
Waiver Letter is in form and substance satisfactory to the Servicer.

	 	3.4	 	Preservation of Lien Priorities; Assignment
of Rights.

Until the earlier of Servicer’s receipt of payment in full of a Loan and termination of the
applicable Loan Commitment or the purchase by Sponsor of a Loan pursuant to the terms of the
Loan Facility Agreement, Servicer shall, if the Loan is secured, (i) prepare amendments to
financing statements promptly upon receipt of written notice of change of name or address or
location of debtors or the Collateral thereunder and file such amendments or a new financing
statement, in the case of a change in the debtor’s location or the location of the
Collateral, in the appropriate location based on the information contained in such notice,
promptly upon return thereof by the debtor, (ii) timely file continuation statements
pertaining to such Financing Statements and (iii) take all other reasonable action requested
by Sponsor to protect the priority of liens or security interests with respect to the
Collateral securing each Loan, all at Sponsor’s expense. Upon the purchase by Sponsor of a
Loan pursuant to the terms of the Loan Facility Agreement, or in the event that Sponsor
reimburses Servicer or otherwise becomes obligated to Servicer for expenses (including
without limitation, funding losses) of Servicer incurred in connection with a proposed loan
which was never consummated that have not been reimbursed by the applicable Borrower,
Servicer shall be deemed to have assigned to Sponsor all rights and remedies that Servicer
may have had against the Borrower in accordance with and subject to the limitations of
Section 10.15 of the Loan Facility Agreement. In connection with such deemed assignment,
Servicer agrees to execute on a timely basis all such instruments and documents as are
reasonably requested in order to evidence Sponsor’s rights or to permit Sponsor to exercise
such rights, including without limitation, forms of assignments, all without recourse to, or
representation or warranty by, Servicer.

 

16

 

	 	3.5	 	Amendments to Loan
Documents; Further Documentation.

Except to correct an immaterial ambiguity or manifest error, Servicer shall not agree to any
amendment of the applicable Loan Documents after closing of any Loan without the prior
written approval of Sponsor unless a Credit Event has occurred and is continuing or the
Sponsor has no further obligations pursuant to its guaranty obligations with respect to such
Loan. Upon receipt of either such approval, or written instructions from Sponsor directing
Servicer to do so, Servicer shall timely prepare written amendments to the Loan Documents or
other documents relating to the Loan in accordance with such approval or instructions, and
shall use its reasonable efforts to obtain on a timely basis the signatures of the Borrower
and/or other appropriate signatories to such Loan Documents or other documents; provided
that, such amendments are not inconsistent with the terms of the Operative Documents (with
the express understanding that to the extent that Servicer has any questions regarding such
consistency, Servicer shall be entitled to refuse to prepare or execute such amendments
until receipt of approval from the Participants pursuant to the Loan Facility Agreement).
Within fifteen (15) days after obtaining such signatures, Servicer shall send Sponsor
photocopies of the original fully executed documents. Servicer shall be entitled to charge
Sponsor, or upon Sponsor’s written instructions, the applicable Borrower, reasonable
attorneys’ fees actually incurred and other expenses relating to the preparation of such
amendments or other documents.

	 	3.6	 	Actions by Servicer.

Unless a Credit Event has occurred and is continuing or the Sponsor has no further
obligation pursuant to its guaranty set forth in the Loan Facility Agreement, Servicer shall
at all times endeavor to comply with the requirements set forth in this Servicing Agreement
and the Loan Facility Agreement, provided that Servicer shall not be required to take any
action which it reasonably determines would expose Servicer to unreasonable risk of
liability or which is contrary to applicable law or which is contrary to the terms of the
Operative Documents.

4.
SPONSOR’S AUDIT AND REPORTING OBLIGATIONS WITH RESPECT TO LINE OF CREDIT
LOANS.

Each Loan Agreement for a Line of Credit shall authorize Servicer or representatives of
Servicer, including Sponsor, to conduct periodic field audits of each Borrower. Unless otherwise
instructed by Servicer, Sponsor hereby covenants and agrees with Servicer to audit each Borrower
with a Line of Credit Commitment no less than once per each six month period and more frequently at
the reasonable request of Servicer with respect to any such Borrower as to whom a Loan Default has
occurred (whether or not waived by Sponsor). In conducting the field audits of the Borrowers with
Line of Credit Commitments, Sponsor will examine the payment receipts, bank statements, loan
statements, Lease Contracts, inventory on hand, computer-generated reports of Asset Dispositions,
Rental Revenue and other financial data necessary to determine the accuracy and validity of the
reports, compliance certificates, financial reports and other information forwarded to either of
Servicer or Sponsor by such Borrowers in connection with the Franchisee Loans.

At the request of Servicer, within thirty (30) Business Days of the completion of each field
audit, Sponsor shall forward to Servicer a written audit report detailing the scope of Sponsor’s
audit, any discrepancies or other misstatements or misrepresentations of the relevant Borrower
discovered in the course of the audit and containing a clear concise statement as to whether or not
Sponsor believes that such Borrower is in compliance with the terms of the Loan Documents to which
it is a party and if not, the nature of any default known to Sponsor and the course of action
planned by the Borrower to remedy

 

17

 

such default. The delivery of each field audit to Servicer by Sponsor shall constitute a
representation and warranty by Sponsor that the information set forth therein is true and correct
in all material respects to the best of Sponsor’s knowledge and that Servicer shall be authorized
to rely on such information in continuing to make Advances to such Borrower.

Notwithstanding the foregoing, Servicer, in its sole discretion, may (at Servicer’s expense,
unless a Credit Event has occurred and is continuing and then at Sponsor’s expense) at any time and
from time to time, undertake to perform an independent field audit of any or all of the Borrowers
with Line of Credit Commitments (with such audit to be performed by officers or employees of
Servicer or other persons retained by Servicer for such purpose). Sponsor shall cooperate fully
with Servicer in connection with any such independent audit.

5. MISCELLANEOUS

	 	5.1	 	Communications.

Unless otherwise provided in the Loan Facility Agreement or under this Servicing Agreement,
all communications under this Servicing Agreement shall be sent in accordance with the
notice procedures set forth in Section 15.1 of the Loan Facility Agreement.

	 	5.2	 	Waivers.

No party hereto shall be deemed to have waived any of its rights under this Servicing
Agreement unless such waiver is in writing and signed by the party for whose benefit such
provision was intended. No delay or omission on the part of any party hereto in exercising
any right shall operate as a waiver of such right or any other right. A waiver on any one
occasion shall not be construed as a bar to or waiver of any right on any future occasion.

	 	5.3	 	Governing Law.

THIS SERVICING AGREEMENT SHALL BE CONSTRUED AND GOVERNED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF GEORGIA (WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PROVISIONS THEREOF).

	 	5.4	 	Successors and Assigns.

This Servicing Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and assigns. Neither party may assign its rights or
obligations hereunder without the prior written consent of the other party hereto.

	 	5.5	 	Amendments; Consents.

No amendment, modification, supplement, termination, or waiver of any provision of this
Servicing Agreement and no consent to any departure by Sponsor therefrom, may in any event
be effective unless in writing signed by Servicer, and then only in the specific instance
and for the specific purpose given.

	 	5.6	 	Indemnification by Servicer.

 

18

 

Without limiting any other rights which Sponsor may have under the Operative Documents or
under applicable law, and subject to the notice and other procedural requirements of Section
11.2 of the Loan Facility Agreement, Servicer hereby agrees to indemnify upon demand and
hold Sponsor harmless from and against all damages, losses, claims, liabilities and related
costs and expenses, including reasonable attorneys’ fees actually incurred and disbursements
as and when incurred, awarded against or incurred by Sponsor, which directly arise out of
Servicer’s gross negligence or willful misconduct in connection with its administration of
the Franchisee Loan Program.

Sponsor expressly acknowledges and agrees that Servicer shall exercise with respect to the
Franchisee Loan Program the same standard of care and diligence in the performance of its
duties, responsibilities and obligations under the Operative Documents as it generally
exercises with respect to loans of a similar size and structure in Servicer’s sole and
absolute discretion. Notwithstanding the foregoing, neither Servicer nor any of its
directors, officers, agents or employees shall have any duty to ascertain, inquire into or
verify (i) any statement, warranty or representation made in connection with the Operative
Documents (other than any of the foregoing made by any of them), any Loan Document or any
borrowing hereunder or thereunder, (ii) the performance or observance of any of the
covenants or agreements of any Borrower; (iii) the satisfaction of any condition specified
in Article 4 of the Loan Agreements, except receipt of the Loan Documents; or (iv) the
validity, effectiveness or genuineness of the Operative Documents or any of the Loan
Documents or any other instrument or writing furnished in connection herewith or therewith,
provided, however, that in each case Servicer, its directors, officers,
agents and employees are acting in good faith and without actual knowledge of a defect in or
invalidity of any of the foregoing; or if Servicer, its directors, officers, agents or
employees do have knowledge of any such defect or invalidity, provided that Sponsor: (x)
has been promptly notified by Servicer of such defect or invalidity; and (y) has expressly
consented to any and all actions to be taken by Servicer, its directors, officers, agents or
employees as a result of, which is attributable to, or otherwise relates to, such defect or
invalidity. Servicer shall not incur any liability by acting in reliance upon any notice,
consent, certificate, statement or other writing (which may be a wire, telex or similar
writing) given in accordance with other provisions of this Agreement reasonably believed by
it to be genuine or is otherwise in accordance with the instructions of Sponsor.

	 	5.7	 	Entire Agreement.

This Servicing Agreement and the other Operative Documents executed and delivered
contemporaneously herewith, together with the exhibits and schedules attached hereto and
thereto, constitute the entire understanding of the parties with respect to the subject
matter hereof, and any other prior or contemporaneous agreements, whether written or oral,
with respect thereto are expressly superseded hereby. The execution of this Servicing
Agreement and the other Operative Documents by Sponsor was not based upon any facts or
materials provided by Servicer, nor was Sponsor induced to execute this Servicing Agreement
or any other related document by any representation, statement or analysis made by Servicer.

	 	5.8	 	Captions.

The captions in this Servicing Agreement are included for convenience only and shall not in
any way affect the interpretation or construction of any of the provisions hereof.

 

19

 

	 	5.9	 	Severability.

If any one or more parts, terms, provisions, paragraphs, or Sections of this Servicing
Agreement shall be held to be illegal or in conflict with state or federal law, the
remaining shall continue in full force and effect.

	 	5.10	 	Counterparts.

This Servicing Agreement may be signed in any number of counterparts, each of which shall be
an original, with the same effect as if the signatures thereto and hereto where upon the
same instrument.

	 	5.11	 	Effect of Amendment and Restatement.

This Agreement constitutes an amendment and restatement of the Existing Servicing Agreement
and is not, and is not intended by the parties to be, a novation of the Existing Servicing
Agreement. All rights and obligations of the parties shall continue in effect, except as
otherwise expressly set forth herein. All references in the Operative Documents to the
Servicing Agreement shall be deemed to refer to and mean this Amended and Restated Servicing
Agreement, as the same may be further amended, supplemented, and restated from time to time.

 

20

 

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

	 	 	 	 	 
	 	AARON’S, INC.

 	 
	 	By:  	/s/  Gilbert L. Danielson
 	 
	 	 	Gilbert L. Danielson 	 
	 	 	Executive Vice President and

Chief Financial Officer 	 
	 
	 	SUNTRUST BANK, as Servicer

 	 
	 	By:  	/s/  Sharon Lawrence
 	 
	 	 	Title:  Director 	 

 

21Exhibit 4.8

Exhibit 4.8

DeGolyer and MacNaughton

5001 Spring Valley Road

Suite 800 East

Dallas, Texas 75244

June 14, 2010

Petrobras Energia S.A.

Maipu 1, 21st Floor

(C1084ABA) Buenos Aires

Argentina

Gentlemen:

Pursuant to your request, we have conducted a reserves evaluation of the net proved crude oil,
natural gas liquids (NGL), and natural gas reserves, as of December 31, 2009, of certain selected
properties in Argentina and Ecuador owned by Petrobras Energia S.A. (PESA). PESA has represented
that these reserves account for approximately 70 percent on a net equivalent barrel basis of PESA’s
net proved reserves as of December 31, 2009. These reserves represent 100 percent of properties
operated by PESA. The net proved reserves estimates prepared by us have been prepared in
accordance with the reserves definitions of Rules 4-10(a) (1)-(32) of Regulation S-X of the
Securities and Exchange Commission (SEC) of the United States. The results of our reserves
evaluation, completed on January 15, 2010, for these South American properties are presented
herein.

Reserves included herein are expressed as net reserves. Gross reserves are defined as the
total estimated petroleum to be produced from these properties after December 31, 2009. Net
reserves are defined as that portion of the gross reserves attributable to the interests owned by
PESA after deducting all interests owned by others.

Estimates of oil, NGL, and natural gas should be regarded only as estimates that may change as
further production history and additional information become available. Not only are such reserves
estimates based on that information which is currently available, but such estimates are also
subject to the uncertainties inherent in the application of judgmental factors in interpreting such
information.

 

 

 

DeGolyer and MacNaughton

Information used in this audit/evaluation was obtained from reviews with PESA personnel, PESA
files, and from public sources. In the preparation of this report we have relied, without
independent verification, upon such information furnished by PESA with respect to property
interests, production from such properties, current costs of operation and development, current
prices for production, agreements relating to current and future operations and sale of production,
and various other information and data that were accepted as represented. A field examination of
the properties was not considered necessary for the purposes of this report.

Methodology and Procedures

Estimates of reserves were prepared by the use of standard geological and engineering methods
generally accepted by the petroleum industry. The method or combination of methods used in the
analysis of each reservoir was tempered by experience with similar reservoirs, stage of
development, quality and completeness of basic data, and production history. The assumptions, data,
methods, and procedures we have relied on and used are appropriate for the purpose served by this
report.

When applicable, the volumetric method was used to estimate the original oil in place (OOIP)
and the original gas in place (OGIP). Structure and isopach maps were constructed to estimate
reservoir volume. Electrical logs, radioactivity logs, core analyses, and other available data were
used to prepare these maps as well as to estimate representative values for porosity and water
saturation. When adequate data were available and when circumstances justified, material balance
and other engineering methods were used to estimate OOIP or OGIP.

Estimates of ultimate recovery were obtained after applying recovery factors to OOIP or OGIP.
These recovery factors were based on consideration of the type of energy inherent in the
reservoirs, analyses of the petroleum, the structural positions of the properties, and the
production histories. When applicable, material balance and other engineering methods were used to
estimate recovery factors. An analysis of reservoir performance, including production rate,
reservoir pressure, and gas-oil ratio behavior, was used in the estimation of reserves.

For depletion-type reservoirs or those whose performance disclosed a reliable decline in
producing-rate trends or other diagnostic characteristics, reserves were estimated by the
application of appropriate decline curves or other performance relationships. In the analyses of
production-decline curves, reserves were estimated only to the limits of economic production or to
the limit of the production licenses as appropriate.

 

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Definition of Reserves

Petroleum reserves estimated by us are classified by degree of proof as proved and are judged
to be economically producible in future years from known reservoirs under existing economic and
operating conditions and assuming continuation of current regulatory practices using conventional
production methods and equipment. In the analyses of production-decline curves, reserves were
estimated only to the limit of economic rates of production under existing economic and operating
conditions using prices and costs consistent with the effective date of this report, including
consideration of changes in existing prices provided only by contractual arrangements but not
including escalations based upon future conditions. Proved reserves classifications used by us in
this report are in accordance with the reserves definitions of Rules 4-10(a) (1)-(32) of Regulation
S-X of the SEC. The petroleum reserves are classified as follows:

Proved oil and gas reserves — Proved oil and gas reserves are those quantities of
oil and gas, which, by analysis of geoscience and engineering data, can be
estimated with reasonable certainty to be economically producible—from a given
date forward, from known reservoirs, and under existing economic conditions,
operating methods, and government regulations—prior to the time at which contracts
providing the right to operate expire, unless evidence indicates that renewal is
reasonably certain, regardless of whether deterministic or probabilistic methods
are used for the estimation. The project to extract the hydrocarbons must have
commenced or the operator must be reasonably certain that it will commence the
project within a reasonable time.

(i) The area of the reservoir considered as proved includes:

(A) The area identified by drilling and limited by fluid contacts, if any,
and (B) Adjacent undrilled portions of the reservoir that can, with
reasonable certainty, be judged to be continuous with it and to contain
economically producible oil or gas on the basis of available geoscience
and engineering data.

(ii) In the absence of data on fluid contacts, proved quantities in a
reservoir are limited by the lowest known hydrocarbons (LKH) as seen in a
well penetration unless geoscience, engineering, or performance data and
reliable technology establishes a lower contact with reasonable certainty.

 

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(iii) Where direct observation from well penetrations has defined a
highest known oil (HKO) elevation and the potential exists for an
associated gas cap, proved oil reserves may be assigned in the
structurally higher portions of the reservoir only if geoscience,
engineering, or performance data and reliable technology establish the
higher contact with reasonable certainty.

(iv) Reserves which can be produced economically through application of
improved recovery techniques (including, but not limited to, fluid
injection) are included in the proved classification when:

(A) Successful testing by a pilot project in an area of the reservoir with
properties no more favorable than in the reservoir as a whole, the
operation of an installed program in the reservoir or an analogous
reservoir, or other evidence using reliable technology establishes the
reasonable certainty of the engineering analysis on which the project or
program was based; and (B) The project has been approved for development
by all necessary parties and entities, including governmental entities.

(v) Existing economic conditions include prices and costs at which
economic producibility from a reservoir is to be determined. The price
shall be the average price during the 12-month period prior to the ending
date of the period covered by the report, determined as an unweighted
arithmetic average of the first-day-of-the-month price for each month within such period,
unless prices are defined by contractual arrangements, excluding
escalations based upon future conditions.

Developed oil and gas reserves — Developed oil and gas reserves are reserves of
any category that can be expected to be recovered:

(i) Through existing wells with existing equipment and operating methods
or in which the cost of the required equipment is relatively minor
compared to the cost of a new well; and

(ii) Through installed extraction equipment and infrastructure operational
at the time of the reserves estimate if the extraction is by means not
involving a well.

 

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DeGolyer and MacNaughton

Undeveloped reserves — Undeveloped oil and gas reserves are reserves of any
category that are expected to be recovered from new wells on undrilled acreage, or
from existing wells where a relatively major expenditure is required for
recompletion.

(i) Reserves on undrilled acreage shall be limited to those directly
offsetting development spacing areas that are reasonably certain of
production when drilled, unless evidence using reliable technology exists
that establishes reasonable certainty of economic producibility at greater
distances.

(ii) Undrilled locations can be classified as having undeveloped reserves
only if a development plan has been adopted indicating that they are
scheduled to be drilled within five years, unless the specific
circumstances, justify a longer time.

(iii) Under no circumstances shall estimates for undeveloped reserves be
attributable to any acreage for which an application of fluid injection or
other improved recovery technique is contemplated, unless such techniques
have been proved effective by actual projects in the same reservoir or an
analogous reservoir, as defined in [section 210.4-10 (a) Definitions], or
by other evidence using reliable technology establishing reasonable
certainty.

Primary Economic Assumptions

The following economic assumptions were used for estimating existing and future prices and
costs:

Oil and Condensate Prices

PESA has represented that the oil and condensate prices were based on a
12-month average price (reference price), calculated as the unweighted
arithmetic average of the first-day-of-the-month price for each month
within the 12-month period prior to the end of the reporting period,
unless prices are defined by contractual arrangements. PESA supplied
differentials by field to a Brent reference price and the prices were held
constant thereafter. No general escalation that might result from
inflation has been applied.

 

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DeGolyer and MacNaughton

Natural Gas Prices

PESA has represented that the natural gas prices were based on a reference
price, calculated as the unweighted arithmetic average of the
first-day-of-the-month price for each month within the 12-month period
prior to the end of the reporting period, unless prices are defined by
contractual arrangements based on specific market segments. No general
escalation that might result from inflation has been applied.

Operating Expenses and Capital Costs

Operating expenses and capital costs, based on information provided by
PESA, were used in estimating future costs required to operate the
properties. In certain cases, future costs, either higher or lower than
existing costs, may have been used because of anticipated changes in
operating conditions. These costs were not escalated for inflation.

While the oil and gas industry may be subject to regulatory changes from time to time that
could affect an industry participant’s ability to recover its oil and gas reserves, we are not
aware of any such governmental actions which would restrict the recovery of the December 31, 2009, estimated oil and gas volumes. The reserves
estimated in this report can be produced under current regulatory guidelines.

Our estimates of PESA’s net proved reserves attributable to the reviewed properties are based
on the definitions of proved reserves of the SEC and are as follows, expressed in millions of
barrels (MMbbl), millions of cubic feet (MMcf), and millions of barrels of oil equivalent (MMboe):

	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Net Proved Reserves	 
	 	 	as of	 
	 	 	December 31, 2009	 
	 	 	 	 	 	 	Natural	 	 	 	 
	 	 	Oil and NGL	 	 	Gas	 	 	Oil Equivalent	 
	 	 	(MMbbl)	 	 	(MMcf)	 	 	(MMboe)	 
	South America
	 	 	 	 	 	 	 	 	 	 	 	 
	Proved Developed
	 	 	52,765	 	 	 	420,110	 	 	 	122,783	 
	Proved Undeveloped
	 	 	11,672	 	 	 	412,488	 	 	 	80,420	 
	 
	 	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 
	Total Proved
	 	 	64,437	 	 	 	832,598	 	 	 	203,203	 

	 	 	 
	Notes:

	 
	1.	 	Gas is converted to oil equivalent using a factor of 6,000 cubic feet of gas per
1 barrel of oil equivalent.

 

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In our opinion, the information relating to estimated proved reserves of oil, condensate,
natural gas liquids, and gas contained in this report has been prepared in accordance with
Paragraphs 932-235-50-4, 932-235-50-6, 932-235-50-7, and 932-235-50-9 of the Accounting Standards
Update 932-235-50, Extractive Industries — Oil and Gas (Topic 932): Oil and Gas Reserve Estimation
and Disclosures (January 2010) of the Financial Accounting Standards Board and Rules 4-10(a)
(1)-(32) of Regulation S-X and Rules 302(b), 1201, 1202(a) (1), (2), (3), (4), (8)(i), (ii), and
(iv)-(x), and 1203(a) of Regulation S-K of the Securities and Exchange Commission.

To the extent the above-enumerated rules, regulations, and statements require determinations
of an accounting or legal nature, we are necessarily unable to express an opinion as to whether the
above-described information is in accordance therewith or sufficient therefor.

 

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DeGolyer and MacNaughton

DeGolyer and MacNaughton is an independent petroleum engineering consulting firm that has been
providing petroleum consulting services throughout the world for over 70 years. DeGolyer and
MacNaughton does not have any financial interest, including stock ownership, in PESA. Our fees were
not contingent on the results of our evaluation. This letter report has been prepared at the
request of PESA. DeGolyer and MacNaughton has used all procedures and methods that it considers
necessary to prepare this report.

Submitted,

DeGOLYER and MacNAUGHTON

Texas Registered Engineering Firm F-716

	 	 	 	 	 
	 	  	
 	 
	 	 	Thomas C. Pence, P.E. 	 
	 	 	Vice President

DeGolyer and MacNaughton 	 

 

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DeGolyer and MacNaughton

CERTIFICATE of QUALIFICATION

I, Thomas C. Pence, Petroleum Engineer with DeGolyer and MacNaughton, 5001 Spring Valley Road,
Suite 800 East, Dallas, Texas, 75244 U.S.A., hereby certify:

	 	1.	 	That I am a Vice President with DeGolyer and MacNaughton, which company did prepare
the report addressed to PESA dated January 15, 2010 and that I, as Vice President, was
responsible for the preparation of this letter.

	 	2.	 	That I attended Texas A&M University, and that I graduated with a degree in Petroleum
Engineering in the year 1982; that I am a Registered Professional Engineer in the State of
Texas; that I am a member of the International Society of Petroleum Engineers; and that I
have in excess of 28 years of experience in the oil and gas reservoir studies and reserves
evaluations.

SIGNED: June 14, 2010

	 	 	 	 	 
	 	  	
 	 
	 	 	Thomas C. Pence, P.E. 	 
	 	 	Vice President

DeGolyer and MacNaughton 	 

 

9

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