Document:

enva-ex1037_266.htm

Exhibit 10.37 

LOAN AND SECURITY AGREEMENT

 

THIS LOAN AND SECURITY AGREEMENT (as amended, modified or restated from time to time, this “Agreement”) dated as of DECEMBER 1, 2016 (the “Effective Date”) sets forth the terms of the Credit Facility (as defined below) by and between REDPOINT CAPITAL ASSET FUNDING, LLC, a Texas limited liability company (together with its successors and assigns, “Lender”) and EFR 2016-2, LLC, a Delaware limited liability company (“Debtor”).

 

RECITALS

WHEREAS, Debtor has requested that Lender extend the Credit Facility to Debtor on the terms set forth in this Agreement; and

WHEREAS, Lender is willing to make the Credit Facility available to Debtor upon and subject to the provisions, terms and conditions set forth in the Loan Documents;

NOW THEREFORE, the parties hereto, intending to be legally bound, agree as follows:

1. Definitions.  As used in this Agreement, all exhibits, appendices and schedules hereto, and in any other Loan Documents made or delivered pursuant to this Agreement, the terms set forth in Part I of Appendix A hereto shall have the meanings given such terms in Appendix A or in the provisions, sections or recitals herein.  The rules of construction set forth in Part II of Appendix A shall be applicable to this Agreement.

2. Credit Facility.

(a)Advancing Term Loan.  Subject to the terms and conditions set forth in this Agreement and the other Loan Documents, Lender hereby agrees to lend to Debtor an outstanding principal amount of up to TWENTY MILLION DOLLARS ($20,000,000.00) (the “Credit Facility”), which may be advanced in one or more Advances from the Effective Date until the earliest of: (i) the SIX (6) month anniversary of the Effective Date, (ii) the occurrence and during the continuance of an Amortization Event or (iii) the acceleration of the Indebtedness pursuant to the terms of this Agreement. Prior to the Maturity Date, Lender may approve in its sole discretion (and upon such terms as may be mutually agreed by Lender and Debtor) an increase in the Credit Facility to an amount not to exceed FORTY MILLION DOLLARS ($40,000,000.00) upon the written request of Debtor and as accepted in writing by Lender.  

(b)Funding.  Following the initial Advance, Debtor shall provide Lender with not less than FIVE (5) Business Days prior written notice of a requested Advance, which notice period may be reduced or waived by Lender in its Permitted Discretion, by submitting a Request for Advance in the form attached hereto as Exhibit D, specifying the amount of such Advance together with the documentation required by such Request for Advance.  No amounts advanced under the Credit Facility may be repaid to the Lender and re-borrowed.  Each Advance under the Credit Facility shall be made available to Debtor by depositing the same, in immediately available funds, to the Collateral Deposit Account.

(c)Use of Proceeds.  The proceeds of each Advance under the Credit Facility shall be used by Debtor to purchase Eligible Consumer Loans from Seller.

(d)Fees.  Debtor agrees to pay an origination fee to Lender in an amount equal to ONE HALF OF ONE PERCENT (0.50%) of the amount of the Credit Facility for the establishment of the Credit Facility. The origination fee shall be due and payable on an Advance as made and shall be deemed fully earned as of the date of such Advance.  The origination fee shall compensate Lender for its costs and expenses in the structuring of the Credit Facility and (to the maximum extent permitted by applicable law) shall not be deemed interest.

(e)Customer Information.  To the extent Lender receives any information from Debtor, Master Servicer or any Asset Servicer that would be “Nonpublic Personal Information” (as defined under the Gramm-Leach-Bliley Act of 1999, “Customer NPPI”), Lender understands and agrees that Customer NPPI is subject to Title V of the Gramm-Leach-Bliley Act of 1999, 15 U.S.C. §§ 6801 et seq., the FTC’s 

 

 

 

Rule regarding the Privacy of Consumer Financial Information, 16 CFR Part 313, the FTC’s Standards for Safeguarding Customer Information, 16 CFR Part 314, and any other applicable laws regarding the privacy or security of Customer NPPI and that Lender shall comply with all such applicable laws regarding such Customer NPPI.

3. Note, Rate and Computation of Interest.  

(a)Note; Interest Rate.  The Credit Facility shall be evidenced by a Note duly executed by Debtor and payable to the order of Lender.  Interest on the Note shall accrue at the rate set forth therein (the “Interest Rate”); provided, that upon the occurrence and during the continuation of a Trigger Event, the Interest Rate shall be increased by the amount specified in Section 8(w)(i), but in no event shall the Interest Rate exceed the maximum amount of interest allowable by law; provided, further, that if such Trigger Event is cured as specified in Section 8(w)(i), the Interest Rate shall revert to the Interest Rate stated in the Note.  The principal of and interest on the Note shall be due and payable in accordance with the terms and conditions set forth in the Note and in this Agreement.  

(b)Prepayment.  No voluntary prepayment of the principal balance of the Note may be made prior to the earliest of (i) the date that is TWENTY-TWO (22) months after the Effective Date, (ii) the occurrence of a Regulatory Trigger Event or (iii) the occurrence of a Trigger Event.  From and after such date, prepayments of the outstanding principal balance of the Note may be made in whole or in part at any time, without premium or penalty; provided that if such prepayment is a result of a Trigger Event, the amount of such prepayment may not be greater than the amount necessary to cause such Trigger Event to cease to occur.

4. Collateral.

(a)Grant of Security Interest.  As collateral security for the prompt payment in full when due (whether at stated maturity, by acceleration or otherwise) of the Indebtedness, Debtor hereby pledges to and grants Lender, a security interest in, all of Debtor’s right, title and interest in the Collateral, whether now owned by Debtor or hereafter acquired and whether now existing or hereafter coming into existence.

(b)Additional Documents.  TO SECURE FULL AND COMPLETE PAYMENT AND PERFORMANCE OF THE INDEBTEDNESS, DEBTOR SHALL EXECUTE AND DELIVER OR CAUSE TO BE EXECUTED AND DELIVERED ALL OF THE LOAN DOCUMENTS REASONABLY REQUIRED BY LENDER COVERING THE COLLATERAL.  DEBTOR SHALL EXECUTE AND CAUSE TO BE EXECUTED SUCH FURTHER DOCUMENTS AND INSTRUMENTS THAT ARE CONSISTENT WITH THIS AGREEMENT, AS LENDER, IN ITS PERMITTED DISCRETION, DEEMS NECESSARY OR DESIRABLE TO CREATE, EVIDENCE, PRESERVE AND PERFECT ITS LIENS AND SECURITY INTERESTS IN THE COLLATERAL.  IN ADDITION, DEBTOR SHALL NOTIFY LENDER OF ANY MATERIAL NON-COMPLIANCE IN RESPECT OF THE REPRESENTATIONS, WARRANTIES AND COVENANTS CONTAINED IN THIS AGREEMENT PROMPTLY UPON ITS KNOWLEDGE THEREOF.

(c)Debtor Remains Liable.  Notwithstanding anything to the contrary contained herein, (i) Debtor shall remain liable under the contracts and agreements included in the Collateral to the extent set forth therein to perform all of Debtor’s respective duties and obligations thereunder; (ii) the exercise by Lender of any of its rights hereunder shall not release Debtor from any of its duties or obligations under this Agreement; and (iii) Lender shall not have any obligation or liability under any of the contracts and agreements included in the Collateral by reason of this Agreement, nor shall Lender be obligated to perform any of the obligations or duties of Debtor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

(d)Satisfaction of Indebtedness.  Until the Indebtedness has been Indefeasibly Paid and fully satisfied (other than contingent indemnification obligations to the extent no unsatisfied claim has been asserted) and the Credit Facility have been terminated, Lender shall be entitled to retain the security 

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interests in the Collateral granted under this Agreement and the ability to exercise all rights and remedies available to Lender under the Loan Documents and applicable laws.

5. Conditions Precedent.

(a)Initial Advance.  The obligation of Lender to make the initial Advance with respect to the Loan under the Credit Facility is subject to the condition precedent that Lender shall have received on or before the day of such Advance all of the following, each dated (unless otherwise indicated) as of the Effective Date, in form and substance satisfactory to Lender:

(i)Resolutions.  Resolutions of the governing body of Debtor and of Enova certified by a Responsible Officer of Debtor and Enova, as applicable, which authorize the execution, delivery and performance of the Loan Documents;

(ii)Incumbency Certificate.  A certificate of incumbency certified by a Responsible Officer of Debtor and Enova certifying the names of the individuals or other Persons authorized to sign the Loan Documents (including the certificates contemplated herein) on behalf of Debtor and Enova to the extent Debtor or Enova executes such documents, together with specimen signatures of such Persons;

(iii)Constituent Documents.  The Constituent Documents of Debtor and Enova certified as being true and correct as of the date of this Agreement;

(iv)Governmental Certificates.  Certificates of the appropriate government officials of the State of organization of Debtor and Enova as to the existence, qualification and good standing of Debtor and Enova, respectively, dated within TEN (10) days of the date of this Agreement;

(v)Loan Documents.  The Loan Documents (other than the Backup Servicing Agreement) executed by Debtor, the Master Servicer, any Asset Servicer and Enova, as applicable;

(vi)Financing Statements.  Code financing statements covering the Collateral (1)
naming Debtor as debtor and Lender as secured party, and (2) naming Seller as seller and Debtor as buyer, shall have been filed with the Secretary of State of the State of Delaware;

(vii)Fees and Expenses.  Evidence that the costs and expenses invoiced by Lender (including reasonable out-of-pocket attorneys’ fees) and all fees owing to Lender, have been paid in full by Debtor;

(viii)Certain Agreements.  Copies of the Sale Agreement and the Servicing Agreement, in form and content satisfactory to Lender, as in effect on the Effective Date, certified as true and correct copies by a Responsible Officer on behalf of Debtor, together with a certificate of such Responsible Officer stating that such agreements remain in full force and effect and that Debtor has not breached or defaulted on any of its obligations under such agreements;

(ix)Opinion of Counsel.  An Opinion of Counsel as to (1) the existence and due organization of Debtor and Enova; (2) the due authorization and execution of the Loan Documents; (3) the enforceability of the Loan Documents; (4) the perfection of Lender’s security interest in the Collateral; and (5) such other matters as may be reasonably requested by Lender and its counsel; and

(x)Other Matters.  Such other documents and agreements as may be required by Lender in its Permitted Discretion.

(b)All Advances.  The obligation of Lender to make any Advance with respect to the Loan under the Credit Facility shall be subject to the following additional conditions precedent:

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(i)Request for Advance.  Lender shall have received a request for a Loan in the form attached hereto as Exhibit D, dated as of the date required by Section 2(b) and executed by a Responsible Officer of Debtor.

(ii)No Default, Etc.  No Default or Event of Default shall have occurred and be continuing, or would result from or after giving effect to such Advance; and

(iii)Representations and Warranties.  All of the representations and warranties contained in the Loan Documents shall be true and correct in material respects on and as of the date of such Advance with the same force and effect as if such representations and warranties had been made on and as of such date.

6. Representations and Warranties.  Upon each Advance hereunder, Debtor hereby represents and warrants to Lender as follows:  

(a)Existence.  Debtor (i) is duly organized, validly existing, and in good standing under the laws of the State of Delaware; (ii) has all requisite power and authority to own its assets and carry on its business as now being or as proposed to be conducted; and (iii) is qualified to do business in all jurisdictions in which the nature of its business makes such qualification necessary and where failure to so qualify would have a Material Adverse Effect. Debtor has the power and authority to execute, deliver, and perform its obligations under the Loan Documents to which it is or may become a party.  The legal name, federal tax identification number and State organizational number for Debtor is set forth below:

			
	
Legal Name
	
Federal Tax Identification Number
	
State Filing Number

	
EFR 2016-2, LLC
	
81-3944969
	
6152399

 

(b)Binding Obligations.  The execution, delivery and performance of the Loan Documents by Debtor has been duly authorized by all necessary action by Debtor and the Loan Documents to which it is a party constitute legal, valid and binding obligations of Debtor, enforceable in accordance with their respective terms, except as limited by bankruptcy, insolvency or similar laws of general application relating to the enforcement of creditors’ rights and except to the extent specific remedies may generally be limited by equitable principles.

(c)No Consent.  The execution, delivery and performance of the Loan Documents, and the consummation of the transactions contemplated thereby, do not (i) conflict with, result in a violation of, or constitute a default under (1) any provision of the Constituent Documents or other instrument binding upon Debtor, (2) any law, governmental regulation, court decree or order applicable to Debtor, or (3) any contractual obligation, agreement, judgment, license, order or permit applicable to or binding upon Debtor, (ii) require the consent, approval or authorization of any third party, or (iii) result in or require the creation of any Lien, charge or encumbrance upon any property of Debtor except as may be expressly contemplated in the Loan Documents.  No consent is required for the exercise by Lender of the rights provided for in the Loan Documents or the remedies in respect of the Collateral pursuant to the Loan Documents.

(d)Financial Condition.  Each Weekly Consumer Loan Value Certificate and Monthly Servicing Report supplied to Lender is accurate in all material respects.

(e)Operation of Business.  Debtor possesses all contracts, licenses, permits and franchises, or rights thereto, necessary to conduct its businesses substantially as now conducted and as presently proposed to be conducted, and Debtor is not in violation of any valid rights of others with respect to any of the foregoing, except any violations that could not reasonably be expected to have a Material Adverse Effect.

(f)Litigation and Judgments.  There is no action, suit, investigation or proceeding before or by any Governmental Authority or arbitrator pending, or to the knowledge of Debtor, threatened against 

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or affecting Debtor that would, if adversely determined, have a Material Adverse Effect.  There are no outstanding judgments against Debtor for which adequate reserves have not been made.

(g)Rights in Collateral; Liens.  Debtor has good and indefeasible title to the Collateral, and none of the Collateral is subject to any Lien, except Permitted Encumbrances.

(h)Debt.  Debtor has no Debt other than Permitted Indebtedness or which is otherwise related to Permitted Encumbrances.

(i)Disclosure.  No statement, information, report, representation or warranty made by Debtor in the Loan Documents or furnished to Lender in connection with the Loan Documents or any of the transactions contemplated hereby contains any untrue statement of a material fact or omits to state any material fact necessary to make the statements herein or therein not misleading.  There is no fact known to Debtor which could reasonably be expected to have a Material Adverse Effect that has not been disclosed in writing to Lender.

(j)Agreements.  Debtor is not a party to any indenture, loan or credit agreement, or to any lease or other agreement or instrument, or subject to any charter or corporate or other organizational restriction which could reasonably be expected to have a Material Adverse Effect.  Debtor is not in default in any material respect in the performance, observance or fulfillment of any of the obligations, covenants, or conditions contained in any agreement or instrument material to its business.  The Sale Agreement is in full force and effect and no material default in the performance of any agreement or obligation thereunder by any party thereto has occurred and is continuing.

(k)Compliance with Laws.  Debtor is not in violation of any law, rule, regulation, order or decree of any Governmental Authority or arbitrator, the violation of which could reasonably be expected to have a Material Adverse Effect.  

(l)Taxes; Governmental Charges.  Debtor has filed all federal, State and local tax reports and returns required by any law or regulation to be filed by it and has either duly paid all taxes, duties and charges indicated due on the basis of such returns and reports, or made adequate provision for the payment thereof, and the assessment of any material amount of additional taxes in excess of those paid and reported is not reasonably expected.  Debtor has no knowledge of any pending investigation of Debtor, Enova or Seller by any taxing authority or any pending but unassessed tax liability. 

(m)Security Interest.  Debtor has and will have at all times full right, power and authority to grant a security interest in the Collateral to Lender in the manner provided herein, free and clear of any Lien, security interest or other charge or encumbrance other than Permitted Encumbrances.

(n)Location.  Debtor’s chief executive office and the office where the records concerning the Collateral are kept are at its address set forth on the signature page hereof.

(o)Use of Proceeds; Margin Securities.  Debtor is not engaged principally, or as one of its important activities, in the business of extending credit for the purpose of purchasing or carrying margin stock (within the meaning of regulations of the Board of Governors of the Federal Reserve System), and no part of the proceeds of any Advance will be used to purchase or carry any margin stock or to extend credit to others for the purpose of purchasing or carrying margin stock.

(p)Regulated Entities.  Debtor is not (i) an “investment company” or a company “controlled” by an “investment company” within the meaning of the Investment Company Act of 1940 or (ii) subject to regulation under the Federal Power Act, the Interstate Commerce Act, any State public utilities code, or any other federal or State statute, rule or regulation limiting its ability to incur Debt, pledge its assets or perform its obligations under the Loan Documents.

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(q)Foreign Assets Control Regulations and Anti-Money Laundering.  Debtor shall not (a) be or become a Person whose property or interests in property are blocked or subject to blocking pursuant to Section 1 of Executive Order 13224 of September 23, 2001 Blocking Property and Prohibiting Transactions With Persons Who Commit, Threaten to Commit or Support Terrorism (66 Fed. Reg. 49079 (2001)), (b) engage in any dealings or transactions prohibited by Section 2 of such executive order, or otherwise be associated with any such Person in any manner violative of Section 2 of such executive order, or (c) otherwise become a Person on the list of Specially Designated Nationals and Blocked Persons in violation of the any applicable limitations or prohibitions under any other United States Treasury Department’s Office of Foreign Assets Control (“OFAC”) regulation or executive order.

(r)Solvency.  Debtor is, and after giving effect to any Advance will be, solvent.

(s)Single Purpose Entity.  Debtor hereby represents, warrants and covenants that Debtor has complied, and shall comply until payment in full of the Indebtedness, with its Constituent Documents, and Debtor shall engage in no other business other than consumer finance and business related to the ownership of the Consumer Loans.  

7. Representations and Warranties Concerning the Collateral.  Upon each Advance hereunder, Debtor hereby represents and warrants to Lender:

(a)Collateral.  With respect to the Collateral at the time the Collateral becomes subject to the Lien in favor of Lender: (i) Debtor is the sole owner, free and clear of all Liens (except for Permitted Encumbrances), and shall be fully authorized to sell, transfer, pledge or grant a security interest in such Collateral; (ii) Debtor has maintained books and records pertaining to the Collateral in such detail, form and scope as is required by this Agreement; (iii) Lender has a perfected Lien on the Collateral (subject only to Permitted Encumbrances) and (iv) to the best of Debtor’s knowledge, the representations and warranties of Seller in the Sale Agreement are true and correct.

(b)No Adverse Selection.  The Consumer Loans sold or transferred to Debtor by Seller have not been selected with the intention to select Consumer Loans that would be adverse to Debtor or Lender compared to comparable Consumer Loans originated by Seller.

(c)No Financing Statements or Control Agreements.  Other than the financing statements and control agreements set forth in this Agreement, there are no other financing statements or control agreements covering any Collateral.

(d)Eligible Consumer Loan.  To the knowledge of Debtor, at the time of sale, each Consumer Loan included in the Consumer Loan Value is an Eligible Consumer Loan.

8. Covenants.  Until all Indebtedness of Debtor under the Loan Documents is Indefeasibly Paid or performed, and Lender has no further commitment to make Advances under the Credit Facility, Debtor agrees and covenants as follows:

(a)Reporting Requirements.  Debtor shall furnish or caused to be furnished to Lender:

(i)As soon as available, and in any event within FORTY-FIVE (45) days after the end of each fiscal quarter of Enova, commencing with the FIRST (1st) fiscal quarter that is not a fiscal year of Debtor ending after the Effective Date, unaudited financial statements of Enova and its consolidated subsidiaries as of the end of such quarter; provided, that no such statements shall be separately delivered to the extent such statements have been publicly filed on Form 10-Q with the SEC;

(ii)As soon as available, and in any event within ONE HUNDRED TWENTY (120) days after the end of each fiscal year of Enova, commencing with the FIRST (1st) fiscal year of Debtor ending after the Effective Date, unaudited financial statements of Enova and its 

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consolidated subsidiaries as of the end of such fiscal year; provided, that no such statements shall be separately delivered to the extent such statements have been publicly filed on Form 10-K with the SEC;

(iii)Simultaneously with the delivery of the financial statements of Enova by clauses (i) and (ii) of this Section 8(a), a certificate of a Responsible Officer on behalf of Debtor in the form of Exhibit C stating that such Responsible Officer has reviewed the provisions of this Agreement and the other Loan Documents and has made or caused to be made under his or her supervision a review of the condition and operations of Debtor during the period covered by such financial statements with a view to determining whether Debtor was in compliance with all of the provisions of this Agreement and such Loan Documents at the times such compliance is required hereby and thereby, and that such review has not disclosed, and such Responsible Officer has no knowledge of, the existence or continuance during such period of an Event of Default or, if an Event of Default exists and is continuing, describing the nature and period of existence thereof and the action which Debtor proposes to take or have taken with respect thereto;

(iv)As soon as available and in any event on the SECOND (2nd) Business Day of each week commencing with the FIRST (1st) week ending after the date of the first Advance, a Weekly Consumer Loan Value Certificate in the form attached hereto as Exhibit A and the weekly reconciliation and summaries received by Debtor from the Master Servicer with respect to the Consumer Loans, which shall each be current as of the Friday of the immediately preceding week.  In connection with such reconciliation and summary, Debtor shall deliver to Lender a weekly report identifying those Consumer Loans which constitute Collateral for Lender as of the end of the immediately preceding week;

(v)As soon as available and in any event on the TENTH (10th) Business Day of each month commencing with the FIRST (1st) month ending after the date of the first Advance, a Monthly Servicing Report from the Master Servicer, and the collateral data tape provided as Schedule A thereto, which shall each be current as of the end of the related Collection Period;

(vi)Promptly after submission to any Governmental Authority, unless such request is confidential, all documents and information furnished to a Governmental Authority in connection with any investigation of Debtor with respect to a Consumer Loan owned by Debtor other than routine inquiries by such Governmental Authority;

(vii)As soon as possible, and in any event within THREE (3) Business Days after the occurrence of an Event of Default or a Default, a written statement of a Responsible Officer on behalf of Debtor setting forth the details of such Event of Default or Default and the action which Debtor proposes to take with respect thereto;

(viii)Promptly after the commencement thereof but in any event not later than THREE (3) Business Days after service of process with respect thereto on, or the obtaining of knowledge thereof by, Debtor, notice of each action, suit or proceeding before any court, arbitrator or other Governmental Authority or other regulatory body which, if adversely determined, could reasonably be expected to have a Material Adverse Effect;

(ix)As soon as possible and in any event within THREE (3) Business Days after execution, receipt or delivery thereof, copies of any material notices that Debtor receives in connection with the Sale Agreement;

(x)Prompt notice of the occurrence of a default by Seller in the performance of any material obligations with respect to the Sale Agreement; and

(xi)Prompt notice of any and all claims made against Debtor that could have a Material Adverse Effect.

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(b)Compliance with Laws.  Debtor shall comply in all material respects with applicable Consumer Financial Services Laws imposed by any Governmental Authority upon Debtor and its businesses, operations and properties where the failure to perform or comply could have a Material Adverse Effect.

(c)Payment of Obligations.  Debtor shall pay its obligations, including tax liabilities, that, if not paid, could become a Lien on any of the Collateral, before the same shall become delinquent or in default, except where such Lien would be a Permitted Encumbrance.

(d)Maintenance and Conduct of Business.  Debtor shall (i) keep, maintain and preserve all property and assets material to the conduct of its business, and (ii) shall cause to be done all things necessary to preserve, renew and keep in full force and effect its legal existence and the rights, licenses, permits, privileges, agreements and franchises material to the conduct of its business.  Debtor shall cause the Sale Agreement and the Servicing Agreement to remain in full force and effect and cause Seller to perform all of its obligations thereunder with respect to the Consumer Loans.

(e)Books and Records; Inspection Rights.  Debtor shall keep proper books of record and account in which full, true and correct entries in all material respects are made of all transactions related to the Consumer Loans.  Debtor shall, and shall cause each Originator to, permit any representatives designated by Lender, upon reasonable prior notice, to visit and inspect its properties, to examine and make extracts from its (or such Originator’s) books and records, and to discuss its  (or such Originator’s) affairs, finances and condition with its  (or such Originator’s) officers and independent accountants, all at such reasonable times and as often as reasonably requested, but in no event more than once per quarter; provided, that upon the occurrence and during the continuation of an Event of Default, no such limit shall be applicable.  In connection with such inspection, Debtor shall provide Lender and any designee of Lender with full access to data and information generated by the applicable system of record in order to view, monitor, reconcile and reproduce the credit and legal files demonstrating the existence of the Consumer Loans and Debtor’s exclusive ownership thereof, including all disbursement and payment activity in connection therewith.  Lender shall comply with all applicable laws relating to viewing personal information relating to Consumer Loans.

(f)Compliance with Agreements.  Debtor shall comply, in all material respects, with the Loan Documents to which it is a party and all material agreements, contracts and instruments binding on it or affecting the Collateral or its business. 

(g)Ownership and Liens.  Debtor shall maintain good title to the Collateral free and clear of all Liens, security interests, encumbrances or adverse claims, except for Permitted Encumbrances. Debtor shall defend at its expense Lender’s security interest in the Collateral against the claims of any third party.

(h)Notice of Pledge.  Debtor shall, after the occurrence and during the continuation of an Event of Default, upon written request from Lender, cause each Consumer Loan Note evidencing a Consumer Loan to have conspicuously printed thereon a notation providing notice that such Consumer Loan Note has been pledged by Debtor to Lender.

(i)Collateral Deposit Account.  Debtor shall cause Master Servicer and each Asset Servicer to deposit all payments relating to each Consumer Loan into the Collateral Deposit Account and shall cause Master Servicer and each Asset Servicer to hold all payments received in connection with each Consumer Loan in trust for Lender pending deposit into the Collateral Deposit Account.

(j)Fundamental Change.  Debtor shall not (i) make any material change in the nature of its business as carried on as of the date hereof, (ii) liquidate, merge or consolidate with or into any other Person, or (iii) make a change in organizational structure or the jurisdiction in which it is organized.

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(k)Indebtedness.  Debtor (without the prior written consent of Lender not to be unreasonably withheld or delayed) shall not create, incur, assume or permit to exist any Debt except for the following (“Permitted Indebtedness”):

(i)The Indebtedness created hereunder; and

(ii)Unsecured Debt incurred in the ordinary course of business not to exceed FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00).

(l)Transactions With Affiliates.  Debtor shall not enter into any transaction, including the purchase, sale or exchange of property or the rendering of any service, with any Affiliate of Debtor, except in the ordinary course of and pursuant to the reasonable requirements of Debtor’s business and upon fair and reasonable terms no less favorable to Debtor than would be obtained in a comparable arm’s‐length transaction with a Person or entity not an Affiliate of Debtor.

(m)Dividends or Distribution.  If an Event of Default shall have occurred and be continuing or if a Default shall have occurred and be continuing (each, a “Blockage Event”), Debtor shall not (i) declare or make any distribution, on account of any equity interest of Debtor, now or hereafter outstanding, or (ii) return any equity interest to any equity holders of Debtor, or make any other distribution of property, assets, obligations or securities thereto as such.

(n)Transfer or Encumbrance.  Except as otherwise provided herein, Debtor shall not (i) sell, assign (by operation of law or otherwise), transfer, exchange, lease or otherwise dispose of any of the Collateral, (ii) grant a Lien or security interest in or execute, file or record any financing statement or other security instrument with respect to the Collateral, or (iii) deliver actual or constructive possession of any of the Collateral to any party other than Lender, Seller, Master Servicer or any Asset Servicer who is acting in its capacity as Seller pursuant to the Sale Agreement or Master Servicer or Asset Servicer pursuant to the Servicing Agreement; provided, however, that Debtor shall be entitled to sell, transfer or dispose of any Charged-Off Consumer Loan without the consent of Lender, and such Charged-Off Consumer Loan and any Collateral related thereto shall be automatically released from the Lien created by this Agreement without any further action by any Person. Lender shall execute and deliver such releases, termination statements and other instruments (in recordable form, where appropriate) as Debtor, as applicable, may reasonably request evidencing the termination of the Lien on such Charged-Off Consumer Loans created by this Agreement.

(o)Impairment of Security Interest.  Debtor shall not take any action that would in any manner impair the enforceability of Lender’s security interest in any Collateral.

(p)Compromise of Collateral.  Debtor shall not adjust, settle, compromise, amend or modify any Collateral, except for Permitted Modifications; provided, however, that Lender may provide instructions that are inconsistent with such requirements but are in accordance with applicable laws upon the occurrence and during the continuation of an Event of Default.  Debtor shall provide to Lender such information received from an Asset Servicer concerning (i) any adjustment, settlement, compromise, amendment or modification of any Collateral, and (ii) any claim asserted by any account debtor for credit, allowance, adjustment, dispute, setoff or counterclaim, as Lender may reasonably request from time to time.

(q)Certain Agreements.  Debtor shall not agree to any amendment or any material change to or material waiver of any of its rights under the Sale Agreement, the Servicing Agreement or any other material contract relating to the Collateral.

(r)Limitations on Credit and Collection Policies.  Debtor shall not permit Master Servicer to make any material change in the Servicing Standards, which change would, based upon the facts and circumstances in existence at such time, reasonably be expected to materially adversely affect the collectability, credit quality or characteristics of the Eligible Consumer Loans, taken as a whole, or the 

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ability of Debtor to perform its obligations or the ability of Lender to exercise any of its rights and remedies, hereunder or under any other Loan Document.

(s)Loan Purchases.  Debtor shall not purchase any Consumer Loans with the funds in the Collateral Deposit Account on or after the date that an Amortization Event or Trigger Event has occurred or is continuing.

(t)Electronic Storage.  Debtor shall cause the Custodian to maintain possession, custody and control of all electronic records, documents and any instruments evidencing the Consumer Loans on behalf of Lender in accordance with the Servicing Agreement and this Agreement.  Debtor shall identify (or shall cause Seller or the Custodian to identify) on the related electronic record the pledge of the Consumer Loans by Debtor to Lender.

(u)Back-Up Servicing.  No later than THIRTY (30) days after the Effective Date, Debtor shall retain a third party backup servicer and enter into a backup servicing agreement as approved by Lender with respect to the Consumer Loans.  After the occurrence of and during the continuation of an Event of Default, Lender may require that Backup Servicer have the sole right to manage all Collections with respect to the Consumer Loans.  The backup servicing agreement shall provide for the priority payment of the backup servicing fees, will contain customary representations, warranties and indemnities and be in form and substance reasonably acceptable to Debtor and Lender.  

(v)Payments.  Prior to the occurrence of a Default or an Event of Default, on the FIFTEENTH (15th) day (or the next succeeding Business Day if the 15th is not a Business Day) of each calendar month (each such date to be a “Payment Date”), Debtor shall distribute the balance on deposit in the Collateral Deposit Account in the following order of priority:

(i)First, to the payment of any accrued and unpaid interest and fees due and owing to Lender since the preceding Payment Date;

(ii)Second, to the financial institutions holding the Collateral Deposit Account or any other collection accounts or third party custodians for any accrued and unpaid fees, costs, indemnities and expenses relating to the Collateral Deposit Account, collection account or custodial account as are due and owing; 

(iii)Third, to pay Master Servicer any earned but unpaid servicing fees that are due and to pay to Backup Servicer any required fees with respect to the Consumer Loans as may be permitted hereunder and as are due and owing; 

(iv)Fourth, to pay any accrued and unpaid auditing costs incurred under Section 8(e) and other expenses agreed by the parties in writing to be paid from proceeds; 

(v)Fifth, upon and during the continuance of an Amortization Event, to the Lenders, the amount necessary to pay the Indebtedness in full;

(vi)Sixth, to the Lenders, the amount of any Optional Prepayment;

(vii)Seventh, to the Collateral Deposit Account, an amount equal to the positive excess, if any, of (A)(x) the Eligible Consumer Loan Pool times (y) the Target LTV minus (B) the outstanding amount of the Indebtedness after giving effect to the distributions set forth in clauses (i) through (vi) above;

(viii)Eighth, upon and during the continuance of a Trigger Event but prior to the occurrence of an Amortization Event, to the Collateral Deposit Account, any remaining amounts;

(ix) Ninth, to or at the direction of Debtor, any remaining amounts.

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(w)Trigger Event.  Upon the occurrence of an initial Trigger Event:

(i)Following the occurrence of a Trigger Event up to and including THIRTY (30) Business Days, Debtor shall immediately cease purchasing Consumer Loans.  During the first THIRTY (30) Business Day period following the occurrence of a Trigger Event, Debtor may (x) repay the Indebtedness so that no Trigger Event shall exist (any restriction of the pre-payment of the Indebtedness contained in the Loan Documents being waived with respect to such required payment), (y) cause additional funds to be deposited to the Collateral Deposit Account so that no Trigger Event shall exist, or (z) cause additional Eligible Consumer Loans to be pledged to increase the Consumer Loan Value so that no Trigger Event shall exist.  In addition, if after FIVE (5) Business Days from the occurrence of the Trigger Event the Debtor has not cured the Trigger Event, then during this period the interest rate under the Note shall increase by an additional 2% (in no event to exceed the maximum amount of interest allowable by law).  If the Trigger Event is cured after FIVE (5) Business Days but within THIRTY (30) Business Days, then the interest rate shall return to the interest rate stated in the Note.

(ii)If the Trigger Event continues for a period of THIRTY ONE (31) Business Days (an “Amortization Trigger Event”), in addition to the provisions in (i) above, Debtor shall repay the Indebtedness in accordance with Section 8(v).

(iii) If the Trigger Event continues for a period of FORTY-FIVE (45) days or more (a “Default Trigger Event”), the continuation of such Trigger Event shall constitute an Event of Default under Section 10(j) and the Lender may, in its sole discretion, exercise any of the remedies available under Section 11 of this Agreement.

(x)Replacement of Ineligible Consumer Loans.  If it is determined that a Consumer Loan was not, at the time of purchase by Debtor, an Eligible Consumer Loan (an “Ineligible Consumer Loan”), Debtor shall cause Seller to either repurchase such Ineligible Consumer Loan and replace such Ineligible Consumer Loan with an Eligible Consumer Loan with an outstanding principal balance equal to or greater than the outstanding principal balance of such Ineligible Consumer Loan.

9. Rights of Lender.  Lender shall have the rights contained in this Section 9 at all times until the Indebtedness has been Indefeasibly Paid.  

(a)Financing Statements.  Debtor hereby authorizes Lender to file, without the signature of Debtor, one or more financing or continuation statements, and amendments thereto, relating to the Collateral.

(b)Power of Attorney.  So long as the Indebtedness is outstanding, Debtor hereby irrevocably appoints Lender as Debtor’s attorney‐in‐fact, such power of attorney being coupled with an interest, with full authority in the place and stead of Debtor and in the name of Debtor or otherwise, from time to time following the occurrence and during the continuation of an Event of Default in Lender’s Permitted Discretion, to take any action and to execute any instrument which Lender may deem necessary or appropriate to accomplish the purposes of this Agreement.  All acts of said attorney or designee are hereby ratified and approved, and said attorney or designee shall not be liable for any acts of omission or commission (other than acts of omission or commission constituting gross negligence or willful misconduct as determined by a final judgment of a court of competent jurisdiction), or for any error of judgment or mistake of fact or law; this power being coupled with an interest is irrevocable until the Loan and other Indebtedness under the Loan Documents are paid in full and all of the Loan Documents are terminated.

(c)Performance by Lender.  If Debtor fails to perform any agreement or obligation provided for in any Loan Document, Lender may itself perform, or cause performance of, such agreement or obligation, and the expenses of Lender incurred in connection therewith shall be a part of the Indebtedness, secured by the Collateral and payable by Debtor on demand.

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(d)Collection of Consumer Loans; Management of Collateral.  Nothing herein contained shall be construed to constitute Lender as agent of Debtor for any purpose whatsoever, and Lender shall not be responsible or liable for any shortage, discrepancy, damage, loss or destruction of any part of the Collateral wherever the same may be located and regardless of the cause thereof (other than from acts of omission or commission constituting gross negligence or willful misconduct as determined by a final judgment of a court of competent jurisdiction).  Lender shall not, under any circumstance or in any event whatsoever, have any liability for any error or omission or delay of any kind occurring in the settlement, collection or payment of any of the Consumer Loans or any instrument received in payment thereof or for any damage resulting therefrom (other than acts of omission or commission constituting gross negligence or willful misconduct as determined by a final judgment of a court of competent jurisdiction).  Lender, by any provision herein or in any assignment or otherwise, does not assume any of the obligations under any contract or agreement assigned to Lender and shall not be responsible in any way for the performance by Debtor of any of the terms and conditions thereof.

10.Events of Default.  Each of the following shall constitute an “Event of Default” under this Agreement:  

(a)Payment Default.  The failure, refusal or neglect of Debtor to pay when due any part of the principal of, or interest on, the Indebtedness owing to Lender by Debtor from time to time, on or before the date that is TWO (2) Business Days after the date such payment is due.  

(b)Performance or Warranty Default.  The failure of Debtor to timely and properly observe, keep or perform any covenant, agreement, warranty or condition required herein or in any of the other Loan Documents, other than with respect to a payment default as set forth in Section 10(a) and a default Trigger Event as set forth in Section 10(j), which is not cured within THIRTY (30) Business Days following written notice from Lender to Debtor; provided, that (i) if such default cannot be cured within THIRTY (30) Business Days, (ii) Debtor has, within such period, taken such actions as are reasonably necessary and appropriate to cure such default, and (iii) Debtor shall continue to diligently pursue such actions, such cure period shall be extended for a period of thirty (30) days following written notice from Lender to Debtor.

(c)Representations.  Any representation contained herein or in any of the other Loan Documents made by Debtor is false or misleading in any material respect and remains unremedied for a period of THIRTY (30) Business Days from the discovery by Debtor or receipt of notice thereof from Lender.

(d)Default Under Other Indebtedness.  The occurrence of any event which results in the acceleration of the maturity of any indebtedness for borrowed money in an aggregate principal amount in excess of ONE HUNDRED THOUSAND AND NO/100 DOLLARS ($100,000.00) owing by Debtor to any third party under any agreement or understanding.

(e)Insolvency.  If Debtor (i) becomes insolvent, or makes a transfer in fraud of creditors, or makes an assignment for the benefit of creditors, or admits in writing its inability to pay its debts as they become due; (ii) generally is not paying its debts as such debts become due; (iii) has a receiver, trustee or custodian appointed for, or take possession of, all or substantially all of its assets, either in a proceeding brought by it or in a proceeding brought against it and such appointment is not discharged or such possession is not terminated within NINETY (90) days after the effective date thereof or it consents to or acquiesces in such appointment or possession; (iv) files a petition for relief under the United States Bankruptcy Code or any other present or future federal or State insolvency, bankruptcy or similar laws (all of the foregoing hereinafter collectively called “Applicable Bankruptcy Law”) or an involuntary petition for relief is filed against it under any Applicable Bankruptcy Law and such involuntary petition is not dismissed within NINEty (90) days after the filing thereof, or an order for relief naming it is entered under any Applicable Bankruptcy Law, or any composition, rearrangement, extension, reorganization or other relief of debtors now or hereafter existing is requested or consented to by it; or (v) fails to have 

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discharged within a period of NINETY (90) days any attachment, sequestration or similar writ levied upon any property of it.

(f)Judgment.  The entry of any judgment against Debtor or the issuance or entry of any attachments or other Liens (other than Permitted Encumbrances) against any of the property of Debtor for an amount in excess of FIFTY THOUSAND AND NO/100 DOLLARS ($50,000.00) (individually or in the aggregate) if uninsured, undischarged, unbonded or undismissed on the date on which such judgment could be executed upon.

(g)Action of Lien Holder.  The holder of any Lien or security interest on any of the Collateral (without hereby implying the consent of Lender to the existence or creation of any such Lien or security interest on the Collateral) declares a default thereunder or institutes foreclosure or other proceedings for the enforcement of its remedies thereunder and is not being contested in good faith by Debtor.

(h)Material Adverse Effect.  Any event shall have occurred or is continuing which shall have had a Material Adverse Effect.

(i)Seller Default.  Seller shall default in the performance of any material obligation to Debtor with respect to any Consumer Loan which is not cured within THIRTY (30) Business Days following written notice from Lender to Debtor; provided, that (i) if such default cannot be cured within THIRTY (30) Business Days, (ii) Seller has, within such period, taken such actions as are reasonably necessary and appropriate to cure such default, and (iii) Seller shall continue to diligently pursue such actions, such cure period shall be extended for a period of thirty (30) days.

(j)Default Trigger Event.  A Default Trigger Event shall have occurred or a second Trigger Event shall have occurred after an initial Trigger Event has been cured; provided, that the occurrence of a second Trigger Event shall not be an Event of Default hereunder if such Trigger Event is cured within FIVE (5) Business Days.

(k)Loan Documents.  (i) The Loan Documents shall at any time after their execution and delivery and for any reason cease (1) to create a valid and perfected FIRST (1st) priority security interest in and to the Collateral; or (2) to be in full force and effect or shall be declared null and void, or (ii) the validity or enforceability of this Agreement shall be contested by Debtor or any other Person party hereto.

11.Remedies and Related Rights.  If an Event of Default shall have occurred, Lender may exercise one or more of the rights and remedies provided in this Section 11, without limiting any other rights and remedies provided herein, under any of the Loan Documents or otherwise available to Lender,. 

(a)Remedies.  Upon the occurrence of any one or more Events of Default, the entire unpaid principal balance of the Note, together with all accrued but unpaid interest thereon, and all other Indebtedness owing to Lender by Debtor at such time shall, at the option of Lender, become immediately due and payable without further notice, demand, presentation, notice of dishonor, notice of intent to accelerate, notice of acceleration, protest or notice of protest of any kind, all of which are expressly waived by Debtor; provided, however, concurrently and automatically with the occurrence of an Event of Default under Section 10(e), further Advances under the Loan Documents shall automatically cease, the Indebtedness at such time shall, without any action by Lender, become due and payable, without further notice, demand, presentation, notice of dishonor, notice of acceleration, notice of intent to accelerate, protest or notice of protest of any kind, all of which are expressly waived by Debtor.

(b)Other Remedies.  Upon the occurrence of and during the continuance of an Event of Default, Lender may from time to time at its Permitted Discretion, without limitation and without notice except as expressly provided in any of the Loan Documents:

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(i)Exercise in respect of the Collateral all the rights and remedies of a secured party under the Code (whether or not the Code applies to the affected Collateral);

(ii)Require Debtor to, and Debtor hereby agrees that it will at its expense and upon request of Lender, assemble the Collateral as directed by Lender and make it available to Lender at a place to be designated by Lender which is reasonably convenient to both parties;

(iii)Reduce its claim to judgment or foreclose or otherwise enforce, in whole or in part, the security interest granted hereunder by any available judicial procedure;

(iv)Sell or otherwise dispose of, at its office, on the premises of Debtor or elsewhere, the Collateral, as a unit or in parcels, by public or private proceedings, and by way of one or more contracts (it being agreed that the sale or other disposition of any part of the Collateral shall not exhaust Lender’s power of sale, but sales or other dispositions may be made from time to time until all of the Collateral has been sold or disposed of or until the Indebtedness has been paid and performed in full), and at any such sale or other disposition it shall not be necessary to exhibit any of the Collateral;

(v)Buy the Collateral, or any portion thereof, at any public sale;

(vi)Buy the Collateral, or any portion thereof, at any private sale if the Collateral is of a type customarily sold in a recognized market or is of a type which is the subject of widely distributed standard price quotations;

(vii)Apply for the appointment of a receiver for the Collateral, and Debtor hereby consents to any such appointment; and

(viii)At its option, retain the Collateral in satisfaction of the Indebtedness whenever the circumstances are such that Lender is entitled to do so under the Code or otherwise.

Debtor agrees that in the event Debtor is entitled to receive any notice under the Code, as it exists in the State governing any such notice, of the sale or other disposition of any Collateral, reasonable notice shall be deemed given when such notice is deposited in a depository receptacle under the care and custody of the United States Postal Service, postage prepaid, at Debtor’s address set forth on the signature page hereof, ten (10) days prior to the date of any public sale, or after which a private sale, of any of such Collateral is to be held.  Lender shall not be obligated to make any sale of Collateral regardless of notice of sale having been given.  Lender may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.

(c)Application of Proceeds.  If any Event of Default shall have occurred, Lender may at its Permitted Discretion apply or use any cash held by Lender as Collateral, and any cash proceeds received by Lender in respect of any sale or other disposition of, collection from, or other realization upon, all or any part of the Collateral in the following order of priority:

(i)First, to the repayment or reimbursement of the reasonable costs and expenses (including reasonable attorneys’ fees and expenses) incurred by Lender in connection with (1) the administration of the Loan Documents, (2) the custody, preservation, use or operation of, or the sale of, collection from, or other realization upon, the Collateral, and (3) the exercise or enforcement of any of the rights and remedies of Lender hereunder;

(ii)Second, to the payment or other satisfaction of any Liens and other encumbrances upon the Collateral;

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(iii)Third, to the satisfaction of the Indebtedness, including payment of any accrued but unpaid fees and expenses due to the Servicer, Backup Servicer, the financial institutions holding the Collateral Deposit Account, any third party custodians and any parties in connection with in audit;

(iv)Fourth, to the payment of any other amounts required by applicable law; and

(v)Fifth, by delivery to Debtor or any other party lawfully entitled to receive such cash or proceeds, whether by direction of a court of competent jurisdiction or otherwise.  

(d)License.  Following the occurrence and during the continuance of an Event of Default, Lender is hereby granted a license or other right to use, without charge, Debtor’s name or any property of a similar nature as it pertains to the Collateral.

(e)Deficiency.  In the event that the proceeds of any sale of, collection from, or other realization upon, all or any part of the Collateral by Lender are insufficient to pay all amounts to which Lender is legally entitled, Debtor (unless otherwise provided) shall be liable for the deficiency, together with interest thereon as provided in the Loan Documents.

(f)Non‐Judicial Remedies.  In granting to Lender the power to enforce its rights hereunder without prior judicial process or judicial hearing, Debtor expressly waives, renounces and knowingly relinquishes any legal right which might otherwise require Lender to enforce its rights by judicial process.  Nothing herein is intended to prevent Lender or Debtor from resorting to judicial process at either party’s option.

(g)Other Recourse.  Debtor authorizes Lender, without notice or demand and without any reservation of rights against Debtor and without affecting Debtor’s liability hereunder or on the Indebtedness, to take or hold any other property of any type from any third party as security for the Indebtedness, and exchange, enforce, waive and release any or all of such other property.

(h)Waiver of Default; Cumulative Remedies.  No failure on the part of Lender to exercise, no delay in exercising and no course of dealing with respect to, any right, power or privilege under this Agreement shall operate as a waiver thereof, nor shall any single or partial exercise of any right, power, or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, power, or privilege. The rights and remedies provided for in this Agreement and the other Loan Documents are cumulative and not exclusive of any rights and remedies provided by law.

(i)Equitable Relief.  Debtor recognizes that in the event Debtor fails to pay, perform, observe or discharge any or all of the Indebtedness, any remedy at law may prove to be inadequate relief to Lender.  Debtor therefore agrees that Lender, if Lender so requests, shall be entitled to temporary and permanent injunctive relief in any such case without the necessity of proving actual damages.

12.Indemnity.  Debtor hereby indemnifies and agrees to hold harmless Lender, and its officers, directors, employees, agents and representatives (each an “Indemnified Person”) from and against any and all liabilities, obligations, claims, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind or nature (other than consequential damages and loss of anticipated profits or earnings) (collectively, the “Claims”) which may be imposed on, incurred by, or asserted against, any Indemnified Person arising in connection with the Loan Documents, the Indebtedness or the Collateral (including the enforcement of the Loan Documents and the defense of any Indemnified Person’s actions or inactions in connection with the Loan Documents).  WITHOUT LIMITATION, THE FOREGOING INDEMNITIES SHALL APPLY TO EACH INDEMNIFIED PERSON WITH RESPECT TO ANY CLAIMS WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT OF THE NEGLIGENCE OF SUCH PERSON OR ANY OTHER INDEMNIFIED PERSON, EXCEPT TO THE LIMITED EXTENT THE CLAIMS AGAINST AN INDEMNIFIED PERSON ARE CAUSED BY SUCH INDEMNIFIED PERSON’S GROSS NEGLIGENCE, BAD FAITH OR WILLFUL MISCONDUCT.  The indemnification provided for in this Section 12 shall survive the termination of this Agreement and shall extend and continue to benefit each individual or entity that is or has at any time been an Indemnified Person hereunder.

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13.Limitation of Liability.  Notwithstanding anything in this Agreement or the other Loan Documents to the contrary (including Section 12 of this Agreement), in no event shall Debtor be liable to Lender or any of its Affiliates for any indirect, consequential, incidental, punitive, exemplary or special damages or expenses.

14.No Duty.  All attorneys, accountants, appraisers and other professional Persons and consultants retained by Lender shall have the right to act exclusively in the interest of Lender and shall have no duty of disclosure, duty of loyalty, duty of care or other duty or obligation of any type or nature whatsoever to Debtor or any of Debtor’s equity holders or any other Person.  Documents in connection with the transactions contemplated hereunder have been prepared by GARDERE WYNNE SEWELL LLP (“Lender’s Counsel”).  Debtor acknowledges and understands that Lender’s Counsel is acting solely as counsel to Lender in connection with the transaction contemplated herein, is not representing Debtor in connection therewith, and has not, in any manner, undertaken to assist or render legal advice to Debtor with respect to this transaction.  Debtor has been advised to seek other legal counsel to represent its interests in connection with the transactions contemplated herein. 

15.Assignment; Successors; Lender Participations.  

(a) Assignment; Successors. This Agreement shall be binding upon and inure to the benefit of Lender and Debtor, and their respective successors and assigns, provided, however, that neither Debtor nor Lender may, without the prior written consent of the other party, assign any rights, powers, duties or obligations under this Agreement or any of the other Loan Documents; provided further that any assignment to an Affiliate of Lender upon notice to Debtor shall be permitted without Debtor’s consent. No such assignment made without the prior consent of the other party to the extent required shall relieve Debtor or Lender, as applicable, of any of its obligations hereunder, and no assignment permitted hereunder shall relieve Debtor or Lender, as applicable, from any obligations arising hereunder prior to such assignment (including obligations with respect to breaches of representations and warranties made herein).

(b) Lender Participations.  Lender may sell participations in or to all or a portion of its rights and obligations under this Agreement (including in the Loan), the Note and the other Loan Documents to one or more parties that is not a competitor of Seller (each, a “Participant”) without the consent of Debtor.  Notwithstanding Lender’s sale of a participation interest, Lender’s obligations hereunder shall remain unchanged.  Debtor shall continue to deal solely and directly with Lender, which shall remain the holder of the Indebtedness.  Lender shall maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each Participant’s interest in the Loans or other obligations under the Loan Documents (the “Participant Register”).  The entries in the Participant Register shall be conclusive absent manifest error, and Lender shall treat each Person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.  

16.Notices.  All notices, requests, demands or other communications required or permitted to be given pursuant to this Agreement shall be in writing and given by (a) electronic or facsimile transmission, (b) personal delivery, (c) expedited delivery service with proof of delivery or (d) United States mail, postage prepaid, registered or certified mail, return receipt requested, sent to the intended addressee at the address set forth on the signature page hereof and shall be deemed to have been received either, in the case of personal delivery, as of the time of personal delivery, in the case of expedited delivery service, as of the time of the expedited delivery and in the manner provided herein, or in the case of mail, upon the third day after deposit in a depository receptacle under the care and custody of the United States Postal Service.  Any party shall have the right to change its address for notice hereunder to any other location within the continental United States by notice to the other party of such new address.

17.GOVERNING LAW; Venue; Service of Process.  This Agreement shall be governed by and construed in accordance with the laws of the State of New York, EXCEPT SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Any action or proceeding against Debtor under or in connection with THIS AGREEMENT 

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shall be brought in any State or federal court within THE CITY of new york and borough of manhattan (the “Venue Site”).  Debtor hereby irrevocably (a) submits to the nonexclusive jurisdiction of such courts, and (b) waives any objection it may now or hereafter have as to the venue of any such action or proceeding brought in any such court or that any such court is an inconvenient forum.  Debtor agrees that service of process upon it may be made by certified or registered mail, return receipt requested, at its address specified or determined in accordance with the provisions in this Agreement.  Nothing in any of the other Loan Documents shall affect the right of Lender to serve process in any other manner permitted by law. 

18.Invalid Provisions.  If any provision of this Agreement is held to be illegal, invalid or unenforceable under present or future laws, such provision shall be fully severable and the remaining provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance.

19.Conflicts.  Except as otherwise expressly provided in the Note, in the event any term or provision of this Agreement is inconsistent with or conflicts with any provision of the other Loan Documents, the terms and provisions contained in this Agreement shall be controlling.  

20.Captions; Counterparts; Facsimile Signatures. The captions in the Loan Documents are intended for convenience and reference only and shall not affect the meaning or interpretation of the Loan Documents.  This Agreement and any waiver or amendment hereto may be executed in counterparts and by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all of which shall together constitute one and the same instrument.  This Agreement and each of the other Loan Documents may be executed and delivered by telecopier or other facsimile transmission all with the same force and effect as if the same was a fully executed and delivered original manual counterpart.  Delivery of an executed signature page of this Agreement and each of the other Loan Documents by facsimile transmission or e-mail shall be as effective as delivery of a manually executed counterpart hereof.

21.Survival.  All representations and warranties made in this Agreement or in any document, statement, or certificate furnished in connection with this Agreement shall survive the execution and delivery of this Agreement, and no investigation by Lender or any closing shall affect the representations and warranties or the right of Lender to rely upon them. 

22.Waiver of Right to Trial by Jury.  THE PARTIES HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, PROCEEDING, OR COUNTERCLAIM THAT RELATES TO OR ARISES OUT OF THIS AGREEMENT OR THE ACTS OR FAILURE TO ACT OF OR BY LENDER IN THE ENFORCEMENT OF ANY OF THE TERMS OR PROVISIONS OF THIS AGREEMENT.

23.PATRIOT Act Notice.  Lender hereby notifies Debtor that pursuant to the requirements of Section 326 of the USA PATRIOT Act of 2001, 31 U.S.C. §5318 (the “PATRIOT Act”), that Lender is required to obtain, verify and record information that identifies Debtor, which information includes the name and address of Debtor and other information that will allow such Lender to identify Debtor in accordance with the PATRIOT Act.

24.Independence of Covenants.  All covenants hereunder shall be given independent effect so that if a particular action or condition is not permitted by any of such covenants, the fact that it would be permitted by an exception to, or be otherwise within the limitations of, another covenant shall not affect any such other covenant.

25.Relationship of Debtor and Seller.  Lender acknowledges that Debtor does not own any equity in Seller, does not control any of the voting equity of Seller and does not otherwise manage Seller. Accordingly, to the extent that this Agreement provides that Debtor will cause Seller to take or not take any actions, the provisions in the Sale Agreement shall control any such actions

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26.Amendments and Waivers. No amendment or waiver of any provision of this Agreement, or consent to any departure therefrom by Lender and Debtor, shall in any event be effective unless the same shall be in writing and signed by Lender and Debtor and then such amendment, waiver or consent shall be effective only in the specific instance and for the specific purpose for which given

27.Termination. This Agreement shall continue in full force and effect until the earlier of (a) the Maturity Date or (b) the date on which Lender accelerates the Loan following the occurrence and during the continuance of an Event of Default.  Notwithstanding any provision of any other Loan Document, no termination of this Agreement shall affect Lender’s rights or any of the Indebtedness existing as of the effective date of such termination, and the provisions of the Loan Documents shall continue to be fully operative until the Indebtedness (other than indemnity obligations of Debtor under the Loan Documents that are not then due and payable or for which any events or claims that would give rise thereto are not then pending) have been fully performed and Indefeasibly Paid.  Except for the release of Liens for any Consumer Loans as provided hereunder, the Liens granted to Lender under this Agreement, the financing statements filed pursuant hereto and the rights and powers of Lender shall continue in full force and effect until all of the Indebtedness (other than indemnity obligations of Debtor under the Loan Documents that are not then due and payable or for which any events or claims that would give rise thereto are not then pending) have been fully performed and Indefeasibly Paid.

NOTICE OF ENTIRE AGREEMENT

 

THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE ENTIRE AGREEMENT BETWEEN THE PARTIES, AND SUPERSEDES ALL PRIOR OR CONTEMPORANEOUS ORAL AGREEMENTS BETWEEN THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.

 

 

 

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AGREED as of the Effective Date.

 

				
	
LENDER:
	
ADDRESS:

	
REDPOINT CAPITAL ASSET FUNDING, LLC
	
8214 Westchester Drive, Suite 910

	
 
	
 
	
 
	
Dallas, TX 75225 

	
By:
	
/s/ J. Andrew Thomas
	
 
	
 

	
Name:
	
J. Andrew Thomas
	
 
	
 

	
Title:
	
Manager
	
 
	
 

 

 

				
	
WITH COPIES OF NOTICES 

TO:
	
 

	
 
	
Gardere Wynne Sewell LLP

	
 
	
 
	
 
	
2021 McKinney Ave., Suite 1600

	
 
	
 
	
 
	
Dallas, TX  75201

	
 
	
 
	
 
	
Attention:Steven S. Camp

 

 

				
	
DEBTOR:
	
ADDRESS:

	
EFR 2016-2, LLC
	
175 W. Jackson Blvd.

	
 
	
 
	
 
	
Suite 1000

	
By:
	
/s/ David A. Fisher 
	
 
	
Chicago, IL 60604

	
Name:
	
David A. Fisher
	
 
	
 

	
Title:
	
President
	
 
	
 

 

 

 

 

Documents Prepared By:

 

Steven S. Camp

Gardere Wynne Sewell LLP

1601 Elm Street, Suite 3000

Dallas, TX  75201

214-999-4354

LOAN AND SECURITY AGREEMENT – SIGNATURE PAGE

REDPOINT CAPITAL ASSET FUNDING, LLC – EFR 2016-2, LLC 

 

 

 

EXHIBIT A

 

FORM OF WEEKLY CONSUMER LOAN VALUE CERTIFICATE

 

Pursuant to that certain LOAN AND SECURITY AGREEMENT (as amended, modified or restated from time to time, the “Loan Agreement”) dated as of December 1, 2016, by and between REDPOINT CAPITAL ASSET FUNDING, LLC, a Texas limited liability company (together with its successors and assigns, “Lender”), and EFR 2016-2, LLC, a Delaware limited liability company (“Debtor”), Debtor has reviewed its activities for the week ending on _____________, and hereby represents and warrants to Lender that the information set forth below is true and correct as of that date (capitalized terms below have the meanings assigned in the Loan Agreement):

 

1.Consumer Loan Value and LTV.  Debtor represents to Lender that the following information regarding the Consumer Loan Value and LTV is true and correct:

 

 

			
	
A
	
Eligible Consumer Loan Pool
	
$

	
B
	
Eligible Consumer Loan Pool times Advance Rate (80%) (Consumer Loan Value)
	
$

	
C
	
Balance of Collateral Deposit Account
	
$

	
D
	
LTV
	
%

 

2.Certification.  The undersigned Responsible Officer hereby certifies on behalf of Debtor that (a) Debtor is in compliance with all covenants of the Loan Agreement, and (b) as of the date of this compliance certificate and the date received by Lender, no Event of Default or Default, has occurred.  The Note and Loan Agreement are acknowledged, ratified, confirmed, and agreed by Debtor to be valid, subsisting, and binding obligations.  Debtor agrees that there is no right to set-off or defense to payment of the Indebtedness.

 

EXECUTED as of the date first written above.

 

EFR 2016-2, LLC

 

 

By:

Name:

Title:

 

 

 

 

EXHIBIT B

 

FORM OF MONTHLY SERVICING REPORT

 

As set forth on Exhibit B to the Servicing Agreement

 

 

 

EXHIBIT C

FORM OF QUARTERLY CERTIFICATION

[________], 20[__]

 

Pursuant to that certain LOAN AND SECURITY AGREEMENT (as amended, modified or restated from time to time, the “Loan Agreement”) dated as of December 1, 2016, by and between REDPOINT CAPITAL ASSET FUNDING, LLC, a Texas limited liability company (together with its successors and assigns, “Lender”) and EFR 2016-2, LLC, a Delaware limited liability company (“Debtor”), the undersigned Responsible Officer hereby certifies on behalf of Debtor that such Responsible Officer has reviewed the provisions of the Loan Agreement and the other Loan Documents and has made or caused to be made under his or her supervision a review of the condition and operations of Debtor during the quarter ended [_________], 20[__] with a view to determining whether Debtor was in compliance with all of the provisions of the Loan Agreement and such Loan Documents at the times such compliance is required hereby and thereby, and that such review has not disclosed, and such Responsible Officer has no knowledge of, the existence or continuance during such period of an Event of Default or, if an Event of Default exists and is continuing, describing the nature and period of existence thereof and the action which Debtor proposes to take or have taken with respect thereto.  Defined terms used but not defined herein shall have the meanings given such terms in the Loan Agreement.

 

EXECUTED as of the date first written above.

 

EFR 2016-2, LLC

 

 

By:

Name:

Title:

 

 

 

 

EXHIBIT D

 

FORM OF REQUEST FOR ADVANCE

 

		
	
RedPoint Capital Asset Funding, LLC
	
Advance Request No. __________

	
8214 Westchester Drive, Suite 910
	
 

	
Dallas, TX 75225
	
 

 

Ladies and Gentlemen:

The undersigned (the “Debtor”) executes and delivers this request for Advance (the “Request”) as of  _________, 20__, in connection with the Loan and Security Agreement (as amended, restated or extended from time to time, the “Loan Agreement”), dated as of December 1, 2016 by and between REDPOINT CAPITAL ASSET FUNDING, LLC, a Texas limited liability company (together with its successors and assigns, “Lender”) and EFR 2016-2, LLC, a Delaware limited liability company (“Debtor”). All capitalized terms used but not defined in this Request shall have the meanings herein they are given in the Loan Agreement.

 

Pursuant to Section 2(b) of the Loan Agreement, Debtor hereby requests an Advance from Lender in the amount of $______________ on _________, 20__.

 

Debtor hereby requests that the Advance be wired to Debtor in immediately available funds on the funding date of ___________, 20__ to the Collateral Deposit Account.

 

Debtor hereby represents and certifies to Lender as follows:

1.As of the date of this Request, no Default or Event of Default exists and each of the conditions to the requested Advance set forth in the Loan Agreement, has been satisfied or otherwise waived by Lender.

2.Debtor’s representations and warranties set forth in the Loan Agreement and the other Loan Documents in favor of Lender are true and accurate in all material respects as of the date of this Request (except those representations and warranties made as of a specific date).

3.As of the funding date, (i) each Consumer Loan that will be purchased by Debtor from Seller, to the best of Debtor’s knowledge, will be an Eligible Consumer Loan and (ii) the Consumer Loan Value of the Eligible Consumer Loans to be purchased by Debtor with the proceeds of the Advance will be greater than or equal to the amount of the Advance.

4.In relation to each Consumer Loan identified in the attached Schedule A, all required Consumer Loan Documents have been or will be delivered to the Servicer prior to the date of the requested Advance in accordance with the Loan Agreement.

5.As of the date of this Request, the sum of the outstanding principal under the Loan (after giving effect to the Advance and pledge to be made on such date pursuant to this Request) plus the amount requested in any outstanding but unfunded requests for Advance does not violate Section 2(a) of the Loan Agreement.

 

[REMAINDER OF PAGE INTENTIONALLY BLANK; SIGNATURE PAGE FOLLOWS]

 

 

 

IN WITNESS WHEREOF, Debtor has duly executed this document as of the date first written above.

 

EFR 2016-2, LLC

 

By: ________________________________
      Name:
      Title: 

 

 

 

 

 

 

 

 

 

APPENDIX A

 

Part I

 

Definitions

 

“Advance” means any advance under the Credit Facility, which advance shall be part of the Loan.

“Advance Date” shall be any Business Day specified in the related Advance Request and shall be the date on which the Lender funds an Advance.

“Advance Date Consumer Loans Schedule” has the meaning set forth in Section 7.02(a) of the Servicing Agreement.

“Advance Rate” means EIGHTY PERCENT (80.00%).

“Affiliate” means, with respect to a specified Person, another Person that directly or indirectly through one or more intermediaries, Controls, is Controlled by or is under common Control with the Person specified.

“Amortization Event” means the occurrence of any of the following events: (i) an Amortization Trigger Event, (ii) an event of default (after giving effect to any cure periods) with respect to the secured indenture covenants of Enova, which event of default has not been cured or waived to Lender’s satisfaction in its Permitted Discretion, (iii) the occurrence of a default under any of the Loan Documents or (iv) the date that is FOUR (4) months prior to the Maturity Date.

“Amortization Trigger Event” means the occurrence of the date on which the number of days since an initial Trigger Event has been in effect exceeds THIRTY-ONE (31) Business Days. 

“Annual Percentage Rate” shall mean, with respect to a Consumer Loan, the interest rate stated in the Consumer Loan Note related to such Consumer Loan.

“Applicable Bankruptcy Law” has the meaning set forth in Section 10(e) of the Loan and Security Agreement.

“Asset Servicer” shall mean, at any time, each Person then appointed as such pursuant to Section 2.01 of the Servicing Agreement or by virtue of a Joinder Agreement, together with its successors and permitted assigns in such capacity.  The initial Asset Servicer shall be NetCredit Loan Services, LLC.

“Asset Servicer Default” shall have the meaning set forth in Section 6.02 of the Servicing Agreement. 

“Asset Servicer Termination Date” shall have the meaning set forth in Section 2.01(a) of the Servicing Agreement.

“Asset Servicer Termination Notice Date” shall have the meaning set forth in Section 6.04(b) of the Servicing Agreement.

“Audit” shall have the meaning set forth in Section 3.04(a) of the Servicing Agreement.

“Backup Servicer” means Carmel Solutions LLC.

“Bank Secrecy Act” shall mean the Currency and Foreign Transactions Reporting Act of 1970, 84 Stat. 1114-2.

 

 

“Blockage Event” has the meaning set forth in Section 8(m) of the Loan and Security Agreement.

“Business Day” means any day other than a Saturday, Sunday or any other day on which the Federal Reserve Bank of Dallas, Texas or banking institutions in New York, New York or Indianapolis, Indiana are closed.

“Charged-Off Consumer Loan” means any Consumer Loan which has been charged off or deemed uncollectible by an Asset Servicer in accordance with the section entitled “Charge-offs and Recoveries” in Exhibit D to the Servicing Agreement (including because of fraud).

“Claims” has the meaning set forth in Section 12 of the Loan and Security Agreement.

“CNU” shall mean CNU Online Holdings, LLC, a Delaware limited liability company.

“Code” means the Uniform Commercial Code as the same may, from time to time, be enacted and in effect in the State of New York; provided, that to the extent that the Code is used to define any term herein or in any Loan Document and such term is defined differently in different articles or divisions of the Code, the definition of such term contained in Article 9 shall govern; provided, further, that in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of, or remedies with respect to, Lender’s Lien on any Collateral is governed by the Uniform Commercial Code as enacted and in effect in a jurisdiction other than the State of New York, the term “Code” means the Uniform Commercial Code as enacted and in effect in such other jurisdiction solely for purposes of the provisions thereof relating to such attachment, perfection, priority or remedies and for purposes of definitions related to such provisions.

“Collateral” means:

(a) all present and future (i) accounts (including all payment rights with respect to the Consumer Loans); (ii) chattel paper (including electronic chattel paper); (iii) contract rights (including all participation rights and interests relating to a Consumer Loan and all rights of Debtor in any collateral securing a Consumer Loan); (iv) the Consumer Loan Documents; (v) the Consumer Loans; (vi) deposit accounts (including the Collateral Deposit Account); (vii) documents, instruments or other agreements relating to the Consumer Loans (including the Consumer Loan Documents); (viii) general intangibles; (ix) instruments (including each Consumer Loan Note); (x) letters of credit; (xi) letter of credit rights; (xii) payment intangibles now or hereafter owned, held, or acquired relating to a Consumer Loan; (xiii) all right, title and interest of Debtor in and under the Sale Agreement; (xiv) all person property (if any) acquired in connection with the realization of any collateral for a Consumer Loan; (xv) any other property, cash  or other assets, real or personal, tangible or intangible, now existing or hereafter acquired, of Debtor that may at any time be or become subject to a security interest or Lien in favor of Lender as security for the Indebtedness; and (xvi) all supporting obligations, products and proceeds of all of the foregoing (including insurance payable by reason of loss or damage to the foregoing property) and any property, assets securities, guaranties or monies of Debtor which may at any time come into the possession of Lender; and

(b) all rights to retrieve data and other information pertaining to the Consumer Loans from third parties.

 “Collateral Deposit Account” means one or more deposit accounts of Debtor into which all payments relating to a Consumer Loan shall be deposited; which deposit accounts shall be subject to an account control agreement in favor of Lender.

“Collection Period” means, with respect to each Payment Date, the period from and including the first day of the calendar month immediately preceding such Payment Date to and including the last day of such calendar month; provided, however, that the initial Collection Period shall be from the Effective Date to and including the last day of the calendar month preceding the month in which the initial Payment Date occurs.

2

 

 

“Collections” means all collections received in respect of the Consumer Loans, including all Scheduled Consumer Loan Payments, all non-scheduled payments, all prepayments, all late fees, all other fees, all Net Liquidation Proceeds, investment earnings, residual proceeds, payments received under any personal guaranty with respect to such Consumer Loans and all other payments received with respect to such Consumer Loans.

“Constituent Documents” means (a) in the case of a corporation, its articles or certificate of incorporation and bylaws; (b) in the case of a general partnership, its partnership agreement; (c) in the case of a limited partnership, its certificate of limited partnership and partnership agreement; (d) in the case of a trust, its trust agreement; (e) in the case of a joint venture, its joint venture agreement; (f) in the case of a limited liability company, its articles of organization and operating agreement or regulations; and (g) in the case of any other entity, its organizational and governance documents and agreements.

“Consumer Financial Services Laws” means all federal, State, and municipal laws, rules, or regulations dealing with consumer financial services.  The term includes any and all laws dealing with registration, licensing, advertising, fair lending, language requirements, origination, pricing, credit practices, disclosures, rates, terms, servicing, debt collection practices, fair credit reporting, communications, privacy, data security, unfair acts or practices, deceptive acts or practices, abusive acts or practices, complaint procedures, and dispute resolution.  The term includes the following laws or standards as applicable:  Equal Credit Opportunity Act, 15 U.S.C. §1691 et seq., and Regulation B, 12 C.F.R. part 1002; Electronic Funds Transfer Act, 15 U.S.C. §1693 et seq., and Regulation E, 12 C.F.R. part 1005; Fair Debt Collection Practices Act, 15 U.S.C. §1692o, and Regulation F, 12 C.F.R. part 1006; Gramm-Leach-Bliley Privacy Act, 12 U.S.C. §6801 et seq., and Regulation P, 12 C.F.R. part 1016; Fair Credit Reporting, 15 U.S.C. §1681 et seq., Regulation V, 12 C.F.R. part 1022; Truth in Lending, 15 U.S.C. §1601 et seq., and Regulation Z, 12 C.F.R. part 1026; Regulations or standards of the Consumer Financial Protection Bureau with respect to unfair, deceptive or abusive acts or practices, 12 U.S.C. § 5531 and §5536; and Regulations or trade practice standards of the Federal Trade Commission with respect to unfair or deceptive acts or practices, 15 U.S.C. §5(a), and Title 16 of the Code of Federal Regulations. 

“Consumer Loan” means (a) an installment consumer loan originated or acquired by Seller or an Originator in a State related to an Obligor residing in such State at the time of such loan’s origination, sold by Seller to Debtor, (b) all rights, title and interest, including all rights of repayment, under the Consumer Loan Documents and all instruments and documents arising therefrom or relating thereto, and (c) all proceeds arising therefrom or relating thereto (including any personal property (if any) acquired by Debtor in connection with the exercise of any remedy relating to a Consumer Loan).

 “Consumer Loan Documents” means all instruments, documents and agreements entered into, evidencing or executed in connection with the application for or disclosure with respect to a Consumer Loan, including a Consumer Loan Note.

“Consumer Loan File” means, with respect to each Consumer Loan, the file (a) to be delivered to the Custodian pursuant to the Servicing Agreement, containing the following documents: (i) the Consumer Loan Documents, and (ii) original, fully executed copies of any modifications, amendments, supplements or addendums to the original Consumer Loan and all other agreements and documents-related to such Consumer Loan, and (b) maintained by the Custodian pursuant to Section 7.01 of the Servicing Agreement.

“Consumer Loan Modification” shall have the meaning set forth in Section 2.02(d) of the Servicing Agreement.

“Consumer Loan Note” means a promissory note and (if applicable) the TILA Disclosure executed by an Obligor in favor of Seller or an Originator in connection with a Consumer Loan.

“Consumer Loan Repurchase Price” shall mean, with respect to any Consumer Loan and any date of determination, an amount equal to the sum of (a) the Outstanding Consumer Loan Principal Balance of such Consumer Loan, plus (b) all accrued and unpaid interest on the Outstanding Consumer Loan Principal 

3

 

 

Balance of such Consumer Loan at the applicable Annual Percentage Rate related to such Consumer Loan through the date on which such Consumer Loan is repurchased.

“Consumer Loan Value” means, at any time, a sum equal to the outstanding principal balance of each Eligible Consumer Loan times the Advance Rate.  By way of example and without limitation:

			
	
ELIGIBLE CONSUMER LOAN
	
ADVANCE RATE
	
CONSUMER LOAN VALUE

	
$100.00
	
80.00%
	
$80.00

 

“Consumer Loans Assignment” means a Consumer Loans Assignment from Seller to Debtor with respect to the Consumer Loans and Other Conveyed Property to be conveyed by Seller to Debtor on any Purchase Date, in substantially the form of Exhibit A to the Sale Agreement.

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlled” has the meaning correlative thereto.

“Credit Facility” has the meaning set forth in Section 2 of the Loan and Security Agreement.

“Custodian” shall mean, at any time, the Person then appointed as such pursuant to Section 7.01 or Section 7.08 of the Servicing Agreement, which shall initially be NetCredit Loan Services, LLC. 

“Cutoff Date” means with respect to any Consumer Loan, the date specified as the “Cutoff Date” of such Consumer Loan in the applicable Consumer Loans Assignment.

“Debt” means as to any Person at any time (without duplication) all items of indebtedness, obligation or liability for borrowed money of a Person, whether mature or unmatured, liquidated or unliquidated, direct or indirect, absolute or contingent, joint or several, that should be classified as debt in accordance with GAAP.

“Debtor” means EFR 2016-2, LLC, a Delaware limited liability company, as debtor under the Loan and Security Agreement.

“Debtor Relief Laws” means (a) the United States Bankruptcy Code and (b) all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization, suspension of payments, readjustment of debt, marshalling of assets, assignment for the benefit of creditors and similar debtor relief laws from time to time in effect in any jurisdiction affecting the rights of creditors generally or the right of creditors of banks.

“Default” means any event which, with notice or the passage of time, would be an Event of Default.

“Default Trigger Event” means the occurrence of the date on which the number of days since an initial Trigger Event has been in effect exceeds FORTY-FIVE (45) Business Days. 

“Delinquent Consumer Loan” means any Consumer Loan which is 1 to 60 days past due on any portion of any Scheduled Consumer Loan Payment under the terms of the Consumer Loan Note and is not a Charged-Off Consumer Loan.

“Effective Date” means December 1, 2016.

“Eligibility Date” means, with respect to any Consumer Loan, each of (i) the date on which such Consumer Loan was initially transferred to Debtor and (ii) the Cutoff Date with respect to such Consumer Loan.

4

 

 

“Eligible Consumer Loan” means a Consumer Loan (whether secured or unsecured) made by Seller or an Originator which is, and at the time of purchase by Debtor was classified as, current on Enova’s financial statements under GAAP and meets the following standards.  In general, a Consumer Loan shall be eligible if: 

	
 
	
(a)
	
when made such Consumer Loan complies with the Underwriting Guidelines; 

	
 
	
(b)
	
such Consumer Loan is pledged to Lender and in respect of which Lender has a perfected FIRST (1st) priority Lien not subject to any other Liens or claims of any kind (other than Permitted Encumbrances); 

	
 
	
(c)
	
such Consumer Loan is not a Delinquent Consumer Loan at the time it is purchased by Debtor;

	
 
	
(d)
	
for any Consumer Loan acquired by Debtor (i) on the Effective Date, at least one Scheduled Consumer Loan Payment has been paid or (ii)(x) after the Effective Date and (y) after the Three-Month Rolling Average FPD Rate has at any time since the Effective Date exceeded the First Payment Default Trigger, the first two Scheduled Consumer Loan Payments have been paid;

	
 
	
(e)
	
no portion of any Scheduled Consumer Loan Payment for such Consumer Loan is more than 60 days past due;

	
 
	
(f)
	
such Consumer Loan is not a Charged-Off Consumer Loan;

	
 
	
(g)
	
such Consumer Loan is not electronic chattel paper;

	
 
	
(h)
	
such Consumer Loan is genuine and is the legal, valid, binding and enforceable obligation of the applicable Obligor;

	
 
	
(i)
	
to the knowledge of Debtor, the Obligor has not asserted any setoff, defense or counterclaim with respect to such Consumer Loan; 

	
 
	
(j)
	
there has not occurred any modification, amendment or extension on such Consumer Loan except for a Permitted Modification; 

	
 
	
(k)
	
such Consumer Loan is evidenced by a Consumer Loan Note and is unconditionally payable in U.S. Dollars; 

	
 
	
(l)
	
the annual percentage rate payable under the respective Consumer Loan Note for such Consumer Loan is greater than or equal to 90% but in no event shall it exceed the highest lawful rate permitted by applicable law; 

	
 
	
(m)
	
to the knowledge of Debtor, the Obligor has not filed a petition for bankruptcy or any other relief under the Bankruptcy Code or any other law relating to bankruptcy, insolvency, reorganization or relief of debtors, made an assignment for the benefit of creditors, or had filed against such person any petition or other application for relief under the Bankruptcy Code or any such other law; 

	
 
	
(n)
	
the Obligor is not an employee of Debtor or Seller, or any of their Affiliates; 

	
 
	
(o)
	
the Obligor has not died or been declared incompetent; 

5

 

 

	
 
	
(p)
	
the Obligor is a natural person who (i) is a U.S. citizen or permanent resident, (ii) at least eighteen (18) years old, (iii) has a valid e-mail account, (iv) has a social security number and (v) has an account at a U.S. financial institution with a routing transit number;

	
 
	
(q)
	
the Obligor is not bankrupt;

	
 
	
(r)
	
Seller, Debtor or their Affiliates have not accepted a settlement with the Obligor with respect to any other debt on which such Obligor was obligated; 

	
 
	
(s)
	
to the knowledge of Debtor, the Obligor was a resident of the State where such loan was made at the time of origination if required under applicable law; 

	
 
	
(t)
	
such Consumer Loan is subject to the Servicing Agreement; 

	
 
	
(u)
	
such Consumer Loan complies in all material respects with all applicable Consumer Financial Services Laws; 

	
 
	
(v)
	
the Consumer Loan Documents are in the possession of the Custodian; 

	
 
	
(w)
	
such Consumer Loan is serviced by an Asset Servicer in compliance with the Servicing Standards; 

	
 
	
(x)
	
an event of default under such Consumer Loan, except as permitted under the Underwriting Guidelines or Servicing Standards, has not occurred or is continuing; 

	
 
	
(y)
	
the Consumer Loan shall not have been written off or deemed uncollectable by an Asset Servicer at the time of the acquisition of the Consumer Loan by Debtor; and 

	
 
	
(z)
	
the Consumer Loan is not evidenced by judgment of a court or reduced to judgment.  

“Eligible Consumer Loan Pool” means ONE HUNDRED PERCENT (100.00%) of the outstanding principal balance of all of the Eligible Consumer Loans owned by Debtor.

“Enova” shall mean Enova International, Inc.

“Enova Party” shall mean each of Enova, CNU, NCLS, any Asset Servicer, the Debtor and each Originator.

“Event of Default” has the meaning set forth in Section 10 of the Loan and Security Agreement.

“Executive Orders” shall mean any legally binding orders given by the President of the United States, acting as the head of the executive branch thereof, to any United States federal administrative agencies.

“Fair Valuation” shall mean in respect of any entity, the value of the consolidated assets of such entity on the basis of the amount which may be realized by a willing seller within a reasonable time through collection or sale of such assets at market value on a going concern basis to an interested buyer who is willing to purchase under ordinary selling conditions in an arm’s-length transaction.

“First Payment Default Rate” means, as of any date of determination after the Effective Date, the aggregate Outstanding Consumer Loan Principal Balance of Consumer Loans sold by Seller to Debtor that experience a default in the first Scheduled Consumer Loan Payment divided by the aggregate Outstanding Consumer Loan Principal Balance of Consumer Loans sold by Seller to Debtor after the Effective Date.

“First Payment Default Trigger” means ELEVEN AND ONE HALF PERCENT (11.50)%.

6

 

 

“GAAP” means generally accepted accounting principles, applied on a consistent basis, as set forth in opinions of the Accounting Principles Board of the American Institute of Certified Public Accountants or in statements of the Financial Accounting Standards Board or their respective successors and which are applicable in the circumstances as of the date in question.  Accounting principles are applied on a “consistent basis” when the accounting principles applied in a current period are comparable in all material respects to those accounting principles applied in a preceding period.

“Governmental Authority” means the government of the United States of America, any other nation or any political subdivision thereof, whether State or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

“Governmental Rules” means any and all laws, statutes, codes, rules, regulations, guidelines, advisories, ordinances, orders, opinions, writs, decrees and injunctions of any Governmental Authority and any and all legally binding conditions, standards, prohibitions, requirements and judgments of any Governmental Authority.

“Immaterial Amendment” shall have the meaning set forth in Section 2.02(e) of the Servicing Agreement.

“Immaterial Underwriting Amendment” shall have the meaning set forth in Section 4.2(f) of the Sale Agreement.

“Indebtedness” means (a) all indebtedness, obligations and liabilities of Debtor to Lender of any kind or character, now existing or hereafter arising, whether direct, indirect, related, unrelated, fixed, contingent, liquidated, unliquidated, joint, several or joint and several, under the Note, this Agreement and the other Loan Documents, (b) all accrued but unpaid interest on any of the indebtedness described in (a) above, (c) all costs and expenses incurred by Lender in accordance with the Loan Documents in connection with the drafting and execution of the Loan Documents, the collection and administration of all or any part of the indebtedness and obligations described in (a) and (b) above or the protection or preservation of, or realization upon, the Collateral securing all or any part of such indebtedness and obligations, including all reasonable out of pocket attorneys’ fees, and (d) all renewals, extensions, modifications and rearrangements of the indebtedness and obligations described in (a), (b) and (c) above.

“Indefeasibly Paid” means (a) with respect to the making of any payment on or in respect of the Indebtedness, that such payment of such Indebtedness has been paid in full in cash (or that such payment of such Indebtedness has been otherwise satisfied in a manner acceptable to the holders of the Indebtedness in their sole discretion), and (b) that the commitments by Lender to make any Advance that would, if made or extended, have been irrevocably terminated.

“Indemnified Person” (a) with respect to the Servicing Agreement, shall have the meaning set forth in Section 5.01(b) of the Servicing Agreement, and (b) with respect to the Loan and Security Agreement, shall have the meaning set forth in Section 12 of the Loan and Security Agreement.  

“Ineligible Consumer Loan” has the meaning set forth in Section 8(x) of the Loan and Security Agreement.

 “Lender” means RedPoint Capital Asset Funding, LLC, a Texas limited liability company, as lender under the Loan and Security Agreement.

“Lien” means any lien, mortgage, security interest, tax lien, pledge, charge, hypothecation, assignment, preference, priority, or other encumbrance of any kind or nature whatsoever (including any conditional sale or title retention agreement), whether arising by contract, operation of law, or otherwise.

7

 

 

“Loan” means the aggregate sum of all Advances made from time to time under the Credit Facility.

“Loan and Security Agreement” means that certain Loan and Security Agreement (as amended, modified or supplemented), dated as of December 1, 2016, by and between Lender and Debtor.

“Loan Documents” means this Agreement, the Note, the Sale Agreement, the Servicing Agreement, the Transfer Agreement and the other agreements, instruments and documents evidencing, securing, governing, guaranteeing or pertaining to the Loan.

“LTV” means, as of any date of determination, a percentage equal to (a) the outstanding principal balance of the Loan, minus the amount on deposit in the Collateral Account, divided by (b) the Eligible Consumer Loan Pool.

“Master Servicer” shall mean, at any time, the Person then appointed pursuant to Section 3.01 of the Servicing Agreement, together with its successors and permitted assigns in such capacity.  The initial Master Servicer shall be NetCredit Loan Services, LLC.

“Master Servicer Default” shall have the meaning set forth in Section 6.01 of the Servicing Agreement. 

“Master Servicer Termination Date” shall have the meaning set forth in Section 3.01 of the Servicing Agreement.

“Master Servicer Termination Notice Date” shall have the meaning set forth in Section 6.03(b) of the Servicing Agreement. 

“Material Adverse Effect” means a material adverse effect on any of (a) the operations, business, assets, properties or financial condition of Debtor or Seller, (b) the ability of Debtor to perform any of its material obligations under any Loan Document to which it is a party, (c) the legality, validity or enforceability of this Agreement or any other Loan Document, or (d) the rights and remedies of Lender under any Loan Document.

“Material Amendment” shall have the meaning set forth in Section 2.02(e) of the Servicing Agreement.

“Material Underwriting Amendment” shall have the meaning set forth in Section 4.2(f) of the Sale Agreement.

“Maturity Date” means the THIRD (3rd) anniversary of the Effective Date.

“Monthly Servicing Report” means a report provided by the Master Servicer setting forth the calculation of the payments made by Debtor from the Collateral Deposit Account, substantially in the form of Exhibit B to the Servicing Agreement.

 

“NCLS” means NetCredit Loan Services, LLC.

 

“Net Liquidation Proceeds” means the aggregate amount of recoveries on (or proceeds from sales of) Charged-Off Consumer Loans, net of any reasonable collection agency fees, legal fees, sales commissions and other reasonable costs related to the collection of recoveries.

“Nonpublic Personal Information” has the meaning set forth in Section 8.11(b) of the Servicing Agreement.

8

 

 

“Note” means the promissory note evidencing the Indebtedness (as any such Note may be amended, modified or restated from time to time).

“Obligor” means, with respect to each Consumer Loan, the borrower under the related Consumer Loan Documents or any other Person who owes or may be liable (whether primarily or secondarily) for payments under such Consumer Loan.

“Obligor Due Date” means, with respect to a Consumer Loan, each date in a calendar month on which an installment payment is due from the Obligor.  By way of example, if an Obligor’s installment payment is due on the 14th day of a month, then the 14th is the Obligor Due Date; if an installment payment is due on each of the 14th and the 28th of a month, then each of the 14th and 28th is an Obligor Due Date.

“OFAC” has the meaning set forth in Section 6(q) of the Loan and Security Agreement.

“Officer’s Certificate” means a certificate on behalf of any Person that is signed by any Responsible Officer or vice president or more senior officer of such Person and which states that the certifications set forth in such certificate are based upon the results of a due inquiry into the matters in question conducted by or under the supervision of the signing officer and that the facts stated in such certifications are true and correct to the best of the signing officer’s knowledge.

“Opinion of Counsel” shall mean a written opinion of counsel, who may be an employee of or counsel to the Seller or the Master Servicer. As to any factual matters relevant to such opinion, such counsel shall be permitted to rely upon an Officer’s Certificate to establish such factual matters, unless such counsel knew or in the exercise of reasonable care should have known, any of such factual matters are erroneous.

“Optional Prepayment” shall mean any voluntary prepayment made by debtor pursuant to Section 3(b) of the Loan and Security Agreement.

“Originator” means any Subsidiary of the Enova listed on Schedule 1 hereto who from time to time sells a Consumer Loan to Seller to sell to Debtor.

“Other Conveyed Property” shall mean, (a) with respect to the Transfer Agreement, shall have the meaning set forth in Section 1.1 of the Transfer Agreement, and (b) with respect to the Sale Agreement, shall have the meaning set forth in Section 2.1(b) of the Sale Agreement.

“Outstanding Consumer Loan Principal Balance” means, with respect to a Consumer Loan, the outstanding amount of principal owed by the Obligor on such Consumer Loan on such date.

“Participant” has the meaning set forth in Section 15(b) of the Loan and Security Agreement.

“Participant Register” has the meaning set forth in Section 15(b) of the Loan and Security Agreement.

“PATRIOT Act” has the meaning set forth in Section 23 of the Loan and Security Agreement.

“Payment Date” has the meaning set forth in Section 8(v) of the Loan and Security Agreement.

“Permitted Discretion” means, with respect to Lender, a determination made in the exercise of Lender’s commercially reasonable (from the perspective of a secured Lender) business judgment.

“Permitted Encumbrances” means:

	
 
	
(a)
	
Liens securing the Indebtedness;

9

 

 

(b)Liens for taxes, assessments and governmental charges not yet due or the payment of which is being contested in good faith and by appropriate proceedings and for which adequate reserves are maintained in accordance with GAAP;

(c)Liens imposed by law arising in the ordinary course of business and securing obligations (other than Debt for borrowed money) that are not overdue by more than SIXTY (60) days or are being contested in good faith and by appropriate proceedings promptly initiated and diligently conducted, and for which reserves are maintained in accordance with GAAP;

(d)judgment Liens not resulting in an Event of Default; and

(e)(i) Liens in favor of collecting banks arising under Section 4-210 of the Code or any similar law, and (ii) Liens arising solely by virtue of any contractual, statutory or common law provision relating to banker’s Liens, rights of set-off or similar rights and remedies and burdening only deposit accounts or other funds maintained in the ordinary course of business with such creditor depository institution; provided, that except as set forth in this Subsection (e), no such deposit account that is a dedicated cash collateral account shall serve as collateral to any Person other than Lender.

“Permitted Indebtedness” has the meaning set forth in Section 8(k) of the Loan and Security Agreement.

“Permitted Modification” shall have the meaning set forth in Section 2.02(d) of the Servicing Agreement.

“Person” means any individual, corporation, limited liability company, business trust, association, company, partnership, joint venture, Governmental Authority, or other entity, and shall include such Person’s heirs, administrators, personal representatives, executors, successors and assigns.

“Protected Party” has the meaning set forth in Section 8.11(a) of the Servicing Agreement.

“Purchase Date” means each Business Day on which Seller acquires Consumer Loans from an Originator pursuant to the terms of the Transfer Agreement or Debtor acquires Consumer Loans from Seller pursuant to the terms of the Sale Agreement, as applicable.

“Quarterly Certification” means a certificate signed by a Responsible Officer on behalf of Debtor substantially in the form of Exhibit C.

 

“Regulatory Trigger Event” shall occur if there is a change in Governmental Rules that prevents or prohibits the Originators from originating Eligible Consumer Loans, or any Governmental Authority asserts that the origination of Eligible Consumer Loans pursuant to Governmental Rules is not permitted.

 

“Related Consumer Loan” shall have the meaning set forth in Section 1.1 of the Transfer Agreement.

“Responsible Officer” means the Person designated by any Person to act on behalf of such Person.  Any document delivered hereunder that is signed by a Responsible Officer of such Person shall be conclusively presumed to have been authorized by all necessary corporate, limited liability company, partnership or other action on the part of Person and such Responsible Officer shall be conclusively presumed to have acted on behalf of such Person.

“Sale Agreement” means that certain SALE AGREEMENT (as amended, modified or supplemented) between Seller and Debtor relating to the sale and purchase of the Consumer Loans.

“Schedule of Serviced Consumer Loans” shall have the meaning set forth in Section 3.03(a) of the Servicing Agreement.

10

 

 

“Scheduled Consumer Loan Payment” means, for any Collection Period and for any Consumer Loan, the amount indicated in the Consumer Loan Documents as required to be paid by the Obligor in such Collection Period; provided that, if after the Effective Date the Obligor’s obligation under such Consumer Loan with respect to a Collection Period has been modified so as to differ from the amount specified in such Consumer Loan as a result of (a) the order of a court in a proceeding relating to Debtor Relief Laws as to which the Obligor is a debtor, (b) the application of the Servicemembers Civil Relief Act of 2003, or (c) a Permitted Modification, the Scheduled Consumer Loan Payment with respect to such Collection Period shall refer to the Obligor’s payment obligation with respect to such Collection Period as so modified.

“SEC” means the U.S. Securities and Exchange Commission.

“Seller” means Enova International, Inc., in its capacity as seller pursuant to the Sale Agreement, together with its successor and permitted assigns in such capacity.  

“Serviced Consumer Loan” shall mean each Consumer Loans set forth on the Schedule of Serviced Consumer Loans; provided, however, that upon the repurchase of such Consumer Loans in accordance with the terms of the Sale Agreement, the Servicing Agreement, or any other Loan Document, such repurchased Consumer Loan shall no longer constitute a Serviced Consumer Loan.

 “Servicing Agreement” means that certain SERVICING AGREEMENT (as amended, modified or supplemented) among Debtor, NetCredit Loan Services, LLC, as Master Servicer, Asset Servicer and Custodian, and the Asset Servicers from time to time party thereto relating to the servicing of, and collateral agency with respect to, the Consumer Loans.

“Servicing Fee” shall mean an amount, with respect to the Master Servicer and for each Payment Date, equal to the product of (i) the Servicing Fee Rate and (ii) the average aggregate Outstanding Consumer Loan Principal Balance for the month preceding such Payment Date.

“Servicing Fee Rate” shall mean 2.00%. 

“Servicing Policy” means, the collections policy and the payment plan policy of the Master Servicer, as such policies may be amended, modified or supplemented from time to time in compliance with the Servicing Agreement.

“Servicing Standards” shall have the meaning set forth in Section 2.01(b) of the Servicing Agreement.

“Solvent” shall mean, with respect to any Person, as of any date of determination, both (a)(i) the sum of such Person’s debt (including contingent liabilities) does not exceed the assets of such Person, at Fair Valuation, (ii) such Person’s capital is not unreasonably small in relation to its business as contemplated on the Effective Date, and (iii) such entity has not incurred and does not intend to incur, or believe (nor should it reasonably believe) that it will incur, debts beyond its ability to pay such debts as they become due (whether at maturity or otherwise), and (b) such Person is “solvent” within the meaning given that term and similar terms under applicable laws relating to fraudulent transfers and conveyances.  For purposes of this definition, the amount of any contingent liability at any time shall be computed as the amount that, in light of all of the facts and circumstances existing at such time, represents the amount that can reasonably be expected to become an actual or matured liability (irrespective of whether such contingent liabilities meet the criteria for accrual under Statement of Financial Accounting Standard No. 5).

“State” means any one of the 50 states of the United States of America or the District of Columbia.

“Subsidiary” means any entity (a) of which at least a majority of the ownership, equity or voting interest is at the time directly or indirectly owned or controlled by a Person, and (b) which is treated as a subsidiary in accordance with GAAP.

11

 

 

“Successor Asset Servicer” shall have the meaning set forth in Section 6.04(a) of the Servicing Agreement.

“Successor Asset Servicing Transfer Date” shall have the meaning set forth in Section 6.04(a) of the Servicing Agreement.  

“Successor Master Servicer” shall have the meaning set forth in Section 6.03(a) of the Servicing Agreement. 

“Successor Master Servicing Transfer Date” shall have the meaning set forth in Section 6.03(a) of the Servicing Agreement.  

“Target LTV” means SEVENTY PERCENT(70%).

“Three-Month Rolling Average FPD Rate” means, as of any date of determination, the percentage equivalent of a fraction, (i) the numerator of which is the sum of the First Payment Default Rates for the three most recent full Collection Periods (or if fewer than three full Collection Periods have elapsed since the Effective Date, the number of full Collection Periods that have elapsed since the Effective Date) and (ii) the denominator of which is THREE (3) (or if fewer than three full Collection Periods have elapsed since the Effective Date, the number of full Collection Periods that have elapsed since the Effective Date).

“TILA Disclosure” means the disclosure delivered to an Obligor in connection with a Consumer Loan pursuant to the Truth in Lending Act.

“Transfer Agreement” means that certain TRANSFER AGREEMENT by and among Seller and each of the Originators party thereto relating to the sale of the Consumer Loans.

“Trigger Event” shall occur if on a Payment Date, the LTV as of the end of the related Collection Period exceeds EIGHTY PERCENT (80%).

“Underwriting Guidelines” means the credit policies and underwriting guidelines of the Seller and the Originators, as such policies may be amended, modified or supplemented from time to time in compliance with the Sale Agreement.

“United States Bankruptcy Code” means Title 11 of the United States Code.

“Venue Site” has the meaning set forth in Section 17 of the Loan and Security Agreement.

“Weekly Consumer Loan Value Certificate” means a certificate provided by Debtor setting forth the calculation of the Consumer Loan Value in compliance with this Agreement, substantially in the form of Exhibit A.

12

 

 

Part II

 

Rules of Construction

 

All words and phrases used in the Loan Documents shall have the meaning specified in the Code, to the extent defined therein, except to the extent such meaning is inconsistent with the Loan Documents. All definitions contained in the Loan Documents are equally applicable to the singular and plural forms of the terms defined.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  The word “or” is not exclusive. The words “hereof,” “herein” and “hereunder” and words of similar import referring to the Loan Documents refer to the Loan Documents as a whole and not to any particular provision of the Loan Documents.  Any agreement, instrument or statute defined or referred to in the Loan Documents or in any instrument or certificate delivered in connection with the Loan Documents shall mean such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein. Any agreement, instrument or statute defined or referred to in the Loan Documents or in any instrument or certificate delivered in connection therewith shall mean such agreement, instrument or statute as from time to time amended, modified or supplemented and includes (in the case of agreements or instruments) references to all attachments thereto and instruments incorporated therein. Any accounting term used in the Loan Documents shall have, unless otherwise specifically provided therein, the meaning customarily given such term in accordance with GAAP, and all financial computations thereunder shall be computed, unless otherwise specifically provided therein, in accordance with GAAP consistently applied; provided, that all financial covenants and calculations in the Loan Documents shall be made in accordance with GAAP as in effect on the Effective Date unless Debtor and Lender shall otherwise specifically agree in writing.  That certain items or computations are explicitly modified by the phrase “in accordance with GAAP” shall in no way be construed to limit the foregoing.

 

13enva-ex1038_270.htm

Exhibit 10.38

 

SALE AGREEMENT 

dated as of December 1, 2016

between

ENOVA INTERNATIONAL, INC.,
as Seller,

and

EFR 2016-2, LLC,
as Debtor

 

 

Table of Contents

				
	
 
	
Page

	
 
	
 

	
 
	
 

	
ARTICLE I DEFINITIONS
	
1

	
 
	
Section 1.1
	
Definitions
	
1

	
 
	
 
	
 
	
 

	
ARTICLE II CONVEYANCE OF CONSUMER LOANS
	
1

	
 
	
Section 2.1
	
Conveyance of Consumer Loans
	
1

	
 
	
Section 2.2
	
Payment of Purchase Price and Acceptance by Debtor
	
3

	
 
	
Section 2.3
	
Transfers Intended as Sales
	
3

	
 
	
 
	
 
	
 

	
ARTICLE III THE CONSUMER LOANS
	
4

	
 
	
Section 3.1
	
Representations and Warranties of the Seller
	
4

	
 
	
Section 3.2
	
Repurchase Upon Breach
	
6

	
 
	
 
	
 
	
 

	
ARTICLE IV THE SELLER
	
6

	
 
	
Section 4.1
	
Representations of the Seller
	
6

	
 
	
Section 4.2
	
Additional Covenants
	
7

	
 
	
Section 4.3
	
Liability of the Seller; Indemnities
	
9

	
 
	
 
	
 
	
 

	
ARTICLE V MISCELLANEOUS
	
10

	
 
	
Section 5.1
	
Notices
	
10

	
 
	
Section 5.2
	
Prior Agreements Superseded
	
10

	
 
	
Section 5.3
	
Amendment
	
10

	
 
	
Section 5.4
	
Parties Bound
	
10

	
 
	
Section 5.5
	
Assignment
	
10

	
 
	
Section 5.6
	
Execution in Counterparts
	
11

	
 
	
Section 5.7
	
Severability of Provisions
	
11

	
 
	
Section 5.8
	
Further Instruments
	
11

	
 
	
Section 5.9
	
Governing Law
	
11

	
 
	
Section 5.10
	
Consent to Jurisdiction
	
11

	
 
	
Section 5.11
	
Waiver of Jury Trial
	
12

	
 
	
Section 5.12
	
Third-Party Beneficiaries
	
12

	
 
	
Section 5.13
	
Termination
	
13

 

EXHIBITS

			
	
Exhibit A
	
-
	
Form of Consumer Loans Assignment

	
 
	
 
	
 

 

 

i

 

This SALE AGREEMENT, is entered into as of December 1, 2016 (as it may be amended, amended and restated, supplemented or otherwise modified from time to time in accordance with the terms hereof, this “Agreement”), by and between Enova International, Inc., a Delaware corporation, as Seller (the “Seller”), and EFR 2016-2, LLC, a Delaware limited liability company, as Debtor (the “Debtor”).

RECITALS:

WHEREAS, the Seller is willing to sell Consumer Loans and Other Conveyed Property to the Debtor from time to time; and 

WHEREAS, the Debtor desires to purchase from the Seller, from time to time, such Consumer Loans and Other Conveyed Property.

NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows:

Article I

DEFINITIONS

Section 1.1Definitions.  Whenever used in this Agreement and unless the context requires a different meaning, capitalized terms used herein and not otherwise expressly defined herein shall have the meanings assigned to such terms in Part I of Appendix A to the Loan and Security Agreement, dated as of the date hereof (the “Loan and Security Agreement”), by and between the Debtor and RedPoint Capital Funding, LLC, a Texas limited liability company, as Lender (the “Lender”), which is incorporated by reference herein and made a part hereof.  The rules of construction set forth in Part II of Appendix A to the Loan and Security Agreement shall be applicable to this Agreement and be incorporated by reference herein and made a part hereof.

 

Article II

CONVEYANCE OF CONSUMER LOANS

Section 2.1Conveyance of Consumer Loans.

 

(a)In consideration of the Debtor’s delivery to, or as may be directed by, the Seller on any Purchase Date of the Purchase Price therefor, the Seller agrees to sell, transfer, assign, set over and otherwise convey to the Debtor, without recourse (except as otherwise provided herein) all right, title and interest of the Seller, whether now existing or hereafter arising, in, to and under:

(i)the Related Consumer Loans set forth in the .csv file delivered in connection with each Consumer Loans Assignment executed and delivered by the Seller on each Purchase Date and all monies received with respect to such Related Consumer Loans on and after the related Cutoff Date;

 

 

(ii)the Consumer Loan File related to each Related Consumer Loan and any and all other Instruments, including Promissory Notes (each as defined in the Code), if any, and other documents relating to the Related Consumer Loans and the related Obligors acquired by the Seller pursuant to the Transfer Agreement;

(iii)all right, title and interest of the Seller in, to and under the Transfer Agreement; 

(iv)all present and future claims, demands, causes and choses in action in respect of any of the foregoing, including the right for the Debtor or its assignee to bring any such claim, demand, cause or chose in action in the name of the Seller; and

(v)all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing, including all cash and non-cash proceeds, and other property consisting of, arising from or relating to all or any part of any of the foregoing.

(b)The Debtor shall purchase and the Seller shall transfer to the Debtor the Related Consumer Loans and the Other Conveyed Property described in paragraph (a) above only upon the satisfaction of each of the conditions set forth below on or prior to the related Purchase Date:

(i)the Seller shall have provided the Debtor, each Asset Servicer, the Backup Servicer and the Master Servicer with either access to an FTP website or a copy of a data tape or other electronic file that, in either case, contains information regarding the Related Consumer Loans and shall have provided any information reasonably requested by the Debtor, each Asset Servicer or the Master Servicer with respect to itself or the Related Consumer Loans, as applicable;

(ii)the Seller shall have deposited into the Collateral Deposit Account all Collections received (if any) on and after the Cutoff Date in respect of the Related Consumer Loans to be purchased by the Debtor on such Purchase Date;

(iii)as of each Purchase Date, (A) the Seller shall be Solvent and shall not fail to be Solvent as a result of the transfer of the Related Consumer Loans on such Purchase Date, (B) the Seller shall not intend to incur or believe that it shall incur debts that would be beyond its ability to pay as such debts mature, (C) such transfers shall not have been made with actual intent to hinder, delay or defraud any Person, and (D) the assets of the Seller shall not constitute unreasonably small capital to carry out its business as then conducted;

(iv)no Event of Default under the Loan and Security Agreement shall have occurred and be continuing;

(v)each of the representations and warranties made by the Seller pursuant to Section 3.1 with respect to the Related Consumer Loans to be purchased on such Purchase Date shall be true and correct as of the related Purchase Date and the Seller shall have performed all obligations required to be performed by it hereunder or in any Consumer Loans Assignment on or prior to such Purchase Date;

2

 

 

(vi)the Seller shall have taken all actions required to maintain the ownership interest of the Debtor in the Related Consumer Loans and Other Conveyed Property;

(vii)no selection procedures adverse to the interests of the Debtor or the Lender shall have been utilized in selecting the Related Consumer Loans to be sold on such Purchase Date;

(viii)no Asset Servicer Default or Master Servicer Default shall have occurred and be continuing; 

(ix)to the extent not already in possession of the Master Servicer, the Seller or its designee shall have delivered each related Consumer Loan File to the Master Servicer no later than two (2) Business Days prior to the requested Purchase Date; and

(x)the Seller shall have executed and delivered to the Debtor a Consumer Loans Assignment in the form of Exhibit A with respect to the Related Consumer Loans and Other Conveyed Property related thereto to be purchased on such Purchase Date. 

Section 2.2Payment of Purchase Price and Acceptance by Debtor.

 

(a)In consideration for the sale of the Related Consumer Loans and Other Conveyed Property described in Section 2.1(a) or the related Consumer Loans Assignment, the Debtor shall, on each Purchase Date on which Related Consumer Loans are transferred hereunder, pay to or upon the order of the Seller the Consumer Loan Value of the Related Consumer Loans (the “Purchase Price”).  The Debtor and the Seller agree that the Purchase Price paid with respect to any Consumer Loans shall represent fair and reasonably equivalent value for the Consumer Loans then sold and purchased.  A portion of the Purchase Price shall be paid to the Seller in immediately available funds and the balance of such purchase shall be paid through a deemed capital contribution from the Seller of the applicable amount to the equity of the Debtor (which, if the Debtor is owned directly by the Seller, shall be effected by a consecutive series of deemed contribution by each intermediate entity in the ownership chain to its subsidiary until such contribution is received by the Debtor).  The amount of the deemed capital contribution shall be duly recorded by the Seller and the Debtor.  The Debtor hereby accepts all consideration conveyed by the Seller pursuant to Section 2.1(a), and declares that the Debtor shall hold such consideration subject to the terms and conditions of the Loan and Security Agreement, this Agreement and the Consumer Loans Assignment.  The Debtor hereby agrees to and accepts the appointment and authorization of NetCredit Loan Services, LLC as Master Servicer under Section 2.01 of the Servicing Agreement.

(b)Immediately upon the conveyance to the Debtor by the Seller of the Related Consumer Loans and Other Conveyed Property pursuant to Section 2.1 and the related Consumer Loans Assignment, all right, title and interest of the Seller in and to such Related Consumer Loans and Other Conveyed Property shall terminate, and all such right, title and interest shall vest in the Debtor.

	
Section 2.3
	
Transfers Intended as Sales.  It is the intention of the Seller and the Debtor that each transfer and assignment contemplated by this Agreement and each Consumer Loans 

3

 

 

		
Assignment shall constitute an absolute and irrevocable sale of the Related Consumer Loans and Other Conveyed Property from the Seller to the Debtor (and not a loan or secured borrowing), free and clear of all liens and rights of others, and it is intended that the beneficial interest in and title to the Related Consumer Loans and Other Conveyed Property shall not be part of the Seller’s estate in the event of the filing of a petition by or against the Seller under any bankruptcy or insolvency law.  In the event that, notwithstanding the intent of the Seller and the Debtor, the transfer and assignment contemplated hereby or by any Consumer Loans Assignment is held not to be a sale, this Agreement and each Consumer Loans Assignment shall constitute a security agreement under applicable law and the Seller hereby grants to the Debtor a security interest in the Related Consumer Loans and Other Conveyed Property, which security interest has been ultimately assigned to the Lender pursuant to the Loan and Security Agreement.

Article III

THE CONSUMER LOANS

Section 3.1Representations and Warranties of the Seller.  The Seller makes the following representations and warranties to the Debtor as to the Related Consumer Loans conveyed to the Debtor pursuant to Section 2.1(a) above, on which the Debtor relies in acquiring the Related Consumer Loans on each Purchase Date, and on which the Lender will rely in making Advances under the Loan and Security Agreement.  All such representations and warranties shall survive the sale, transfer and assignment of the Related Consumer Loans to the Debtor and the pledge thereof to the Lender pursuant to the Loan and Security Agreement.

(a)Characteristics of Consumer Loans.  Each Related Consumer Loan is an Eligible Consumer Loan and no selection procedures adverse to any party hereto have been utilized in selecting the Related Consumer Loans to be sold hereunder.

(b)Schedule of Consumer Loans.  The information with respect to the Related Consumer Loans set forth in the .csv file delivered in connection with the related Consumer Loans Assignment is true and correct in all material respects as of the close of business on the related Cutoff Date.

(c)Title.  No Related Consumer Loan or Other Conveyed Property has been sold, transferred, assigned, or pledged by the Seller to any Person other than the Debtor.  Immediately prior to each transfer and assignment herein contemplated, the Seller had good and marketable title to each Related Consumer Loan and the Other Conveyed Property and the Seller was the sole owner thereof, free and clear of all liens, claims, encumbrances, security interests, and rights of others, and, immediately upon the transfer thereof to the Debtor, the Debtor shall have good and marketable title to the Consumer Loans and the Other Conveyed Property and shall be the sole owner thereof, free and clear of all Liens.

(d)Lawful Assignment; No Consent Required.  No Related Consumer Loan has been originated in, or is subject to the laws of, any jurisdiction the laws of which would make unlawful the sale, transfer and assignment of such Related Consumer Loan under this Agreement.  The Seller has not entered into any agreement that prohibits, restricts or conditions the assignment of any portion of the Related Consumer Loans.  No consent by any Person is 

4

 

 

required under any agreement or applicable law for the validity of such sales, transfers and assignments. 

(e)All Filings Made.  All filings (including Code filings or other actions) necessary in any jurisdiction to give the Debtor a first priority perfected ownership interest in the Related Consumer Loans and the Other Conveyed Property, including the proceeds of the Related Consumer Loans, shall have been made, given, taken or performed.

(f)No Impairment.  Neither the Seller nor the Debtor has done anything to convey any right to any Person that would result in such Person having a right to payments due under any Related Consumer Loan or otherwise to impair the rights of the Debtor or the Lender in any Related Consumer Loan or the proceeds thereof.

(g)Consumer Loans Not Assumable.  No Related Consumer Loan is assumable by another Person in a manner which would release the Obligor thereof from such Obligor’s obligations to the Debtor or the Seller with respect to such Related Consumer Loan.

(h)Creation of Security Interest.  This Agreement creates a valid and continuing security interest (as defined in the Code) in the Related Consumer Loans and the Other Conveyed Property in favor of the Debtor, which security interest is prior to all other Liens (other than Permitted Encumbrances) and is enforceable as such as against creditors of and purchasers from the Seller. 

(i)Perfection of Security Interest in Consumer Loans and Other Conveyed Property.  The Seller has caused the filing of all appropriate financing statements and amendments thereto in the proper filing office in the appropriate jurisdictions under applicable law, in order to perfect the first priority security interest in the Related Consumer Loans and the Other Conveyed Property granted to the Debtor hereunder pursuant to Section 2.3 and the related Consumer Loans Assignment.

(j)No Other Security Interests by the Seller.  Other than the security interest granted to the Debtor pursuant to Section 2.3 and the related Consumer Loans Assignment, the Seller has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed, any of the Related Consumer Loans or Other Conveyed Property, other than such security interests as are released at or before the conveyance thereof.  The Seller has not authorized the filing of and is not aware of any financing statements filed against the Seller that include a description of collateral covering any portion of the Related Consumer Loans and the Other Conveyed Property, other than any financing statement relating to the security interest granted to the Debtor hereunder, or that has been terminated or released as to the Related Consumer Loans and the Other Conveyed Property.  The Seller is not aware of any judgment or tax lien filings against the Seller.

(k)Records.  On or prior to each Purchase Date, the Seller shall have caused its records (including electronic ledgers) relating to each Related Consumer Loan to be conveyed by it on such Purchase Date to be clearly and unambiguously marked to reflect that such Related Consumer Loan was conveyed by it to the Debtor.

5

 

 

(l)Computer Information.  The electronic information made available by the Seller to the Debtor with respect to each Purchase Date is, as of the related Cutoff Date, complete and accurate and includes a description of the same Consumer Loans set forth in the .csv file delivered in connection with the related Consumer Loans Assignment.

(m)No Pre-existing Indebtedness.  The Seller is not transferring any Related Consumer Loan to the Debtor in connection with any pre-existing indebtedness.

	
Section 3.2
	
Repurchase Upon Breach.  The Seller shall inform the Debtor and the Lender promptly, in writing, upon the discovery of (or upon receiving notice from the Lender of) any breach of the representations and warranties made by the Seller in Section 3.1 of this Agreement.  Unless the breach shall have been cured within thirty (30) day following the notice to the Debtor and the Lender of such breach, the Seller shall, within ten (10) Business Days of the end of such thirty (30) day period, repurchase the applicable Related Consumer Loan.  In consideration of the repurchase of any Related Consumer Loan, the Seller shall remit to the Collateral Deposit Account the Consumer Loan Repurchase Price on the date of such repurchase.  Upon the deposit of the Consumer Loan Repurchase Price in respect of any such Consumer Loans into the Collateral Deposit Account, the Debtor shall cause the Master Servicer to release the related Consumer Loan File and the Debtor and the Lender shall execute and deliver (at the expense of the Seller) all reasonable instruments of transfer or assignment, without recourse, as are prepared by the Seller and delivered to the Debtor and the Lender and necessary to vest in the Seller title to such Consumer Loans.  The purchase obligations of the Seller under this Section 3.2 shall be continuing and shall survive the termination of the Servicing Agreement and any termination of the Master Servicer.  The sole remedies of the Debtor under this Agreement with respect to any Consumer Loans as to which a breach of representations and warranties pursuant to Section 3.1 of this Agreement has occurred shall be to enforce the Seller’s obligation to repurchase such Consumer Loans pursuant to this Section 3.2.

Article IV

THE SELLER

	
Section 4.1
	
Representations of the Seller.  The Seller makes the following representations and warranties to the Debtor as to itself, on which the Debtor and the Lender rely until the Loan and Security Agreement is terminated.  All such representations and warranties shall survive the sale, transfer and assignment of the Related Consumer Loans to the Debtor and the pledge thereof to the Lender pursuant to the Loan and Security Agreement.

(a)The Seller is an entity duly formed, validly existing and in good standing under the laws of the State of Delaware, is duly qualified to do business and is in good standing in all states where such qualification is required, except in those states where the failure to be so qualified has not had and could not be reasonably expected to have, a Material Adverse Effect, has all necessary corporate power and authority to enter into this Agreement and each other Loan Document to which it is a party and to perform all of its obligations hereunder and thereunder.

(b)The Seller has all requisite right and power and is duly authorized and empowered to enter into, execute, deliver and perform this Agreement and each other Loan Document to 

6

 

 

which it is a party and this Agreement and each other Loan Document to which the Seller is a party are the legal, valid and binding obligations of the Seller, and are enforceable against the Seller in accordance with their terms (subject, as to enforcement of remedies, to applicable bankruptcy, reorganization, insolvency, moratorium or other laws and legal principles affecting creditors’ rights generally from time to time in effect and to general equitable principles, whether applied in an action at law or in equity).

(c)The execution, delivery and performance by the Seller of this Agreement and each of the Loan Documents to which it is a party does not and shall not (i) violate any provision of any applicable law, order, writ, judgment, injunction, decree, determination or award presently in effect having applicability to the Seller, (ii) violate any provision of its articles of incorporation, by-laws or formation documents or (iii) result in a breach of or constitute a default under the terms of any indenture, loan, credit agreement or any other agreement, lease or instrument to which the Seller is a party or by which it or any of its assets or properties may be bound or affected; and the Seller is not in default of any such law, order, writ, judgment, injunction, decree, determination or award or any such indenture, agreement, lease or instrument.

(d)No consent, approval, license, exemption of or filing or registration with, giving of notice to, or other authorization of or by, any court, administrative agency or other Governmental Authority is or shall be required in connection with the execution, delivery or performance by the Seller of this Agreement and each other Loan Document for the valid consummation of the transactions contemplated hereby or thereby, other than the filing of financing statements.

(e)There is no action, suit, proceeding or investigation pending or threatened against or affecting the Seller before or by any court, administrative agency or other Governmental Authority that brings into question the validity of the transactions contemplated hereby, or that might result in any Material Adverse Effect.

(f)The Seller and each of its Subsidiaries are in compliance in all material respects with all United States economic sanctions laws, Executive Orders and implementing regulations as promulgated by OFAC, and all applicable anti-money laundering and counter-terrorism financing provisions of the Bank Secrecy Act and all regulations issued pursuant to it.

	
Section 4.2
	
Additional Covenants.

(a)Sale.  The Seller agrees to treat the conveyances hereunder as sales for all purposes (including legal and bankruptcy purposes) on all relevant books, records, tax returns, financial statements and other applicable documents, and from and after the Purchase Date relating to any Related Consumer Loans, the Seller shall not take any action inconsistent with the Debtor’s absolute ownership of the Related Consumer Loans and shall not claim any ownership interest in the Related Consumer Loans; provided, that the financial statements of the Debtor may be consolidated with those of the Seller in accordance with GAAP.  The Seller shall not make any transfer of Consumer Loans hereunder if the Seller or the Debtor is then insolvent or would be rendered insolvent thereby.

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(b)Non-Petition.  The Seller covenants and agrees that, to the fullest extent permitted by applicable law, it shall not take any action to pursue any remedy against the Debtor that it may have hereunder, in law, in equity or otherwise, until one (1) year and one (1) day have passed since the date on which the Advances have been paid in full.  The Debtor and the Seller agree that damages shall not be an adequate remedy for breach of this covenant and that this covenant may be specifically enforced by the Debtor.

(c)Cooperation.  If an Event of Default shall have occurred and be continuing, the Seller and the Debtor shall cooperate with and provide all information and access reasonably requested by the Lender in connection with any actions taken in connection therewith pursuant to the Loan Documents.

(d)Accounts.  The Seller covenants and agrees it shall not direct any Person to deposit any Collections with respect to the Related Consumer Loans in any account other than the Collateral Deposit Account.

(e)Solvency.  The Seller shall not fail to be Solvent by the execution and delivery of this Agreement and the consummation of the transactions contemplated hereby, and the capital remaining in the Seller is not now and shall not foreseeably become unreasonably small to permit the Seller to carry on its business and transactions and all businesses and transactions in which it is about to engage.  The Seller does not intend to, nor does it reasonably believe it shall, incur debts beyond its ability to repay the same as they mature.

(f)Changes to the Underwriting Guidelines.  The Seller shall (i) deliver a written summary on or prior to the tenth calendar day of each month (or if the tenth calendar day of any given month is not a Business Day, the next following Business Day) of the immaterial changes or modifications that have been made to the Underwriting Guidelines (each, an “Immaterial Underwriting Amendment”) since delivery of the prior summary delivered pursuant to this Section 4.2(f)(i) (or in the case of the initial summary, since the Closing Date), to the Debtor and the Lender, and (ii) promptly furnish notice to the Debtor and the Lender of any material proposed change or modification to the Underwriting Guidelines (each, a “Material Underwriting Amendment”) and any such Material Underwriting Amendment may only be made with the prior consent of the Lender; provided, that if the Lender has not consented to such Material Underwriting Amendment within ten (10) Business Days of receipt of notice thereof, the Lender shall use commercially reasonable efforts to address such Material Underwriting Amendment in a mutually agreeable manner within thirty (30) Business Days of the Lender’s receipt of such notice; provided further that if the Lender does not consent to such Material Underwriting Amendment by the end of such thirty (30) Business Day period, such Material Underwriting Amendment may become effective solely with respect to Consumer Loans that are not Eligible Consumer Loans. If an item designated as an Immaterial Underwriting Amendment in the written summary described above in clause (i) is deemed a Material Underwriting Amendment by the Lender or if a Material Underwriting Amendment described above in clause (ii) is enacted without the prior consent of the Lender, then the Seller shall within five (5) Business Days of receiving any request to do so from the Lender repurchase in accordance with Section 3.2 any and all Consumer Loans (x) that were originated from the date of such Immaterial Underwriting Amendment or Material Underwriting Amendment, as applicable, was made effective and that 

8

 

 

were sold to the Debtor and (y) that but for such Immaterial Underwriting Amendment or Material Underwriting Amendment would not have otherwise been an Eligible Consumer Loan.

	
Section 4.3
	
Liability of the Seller; Indemnities.

(a)The Seller shall defend, indemnify and hold harmless the Debtor, the Lender and their Affiliates and their respective officers, directors, agents and employees for any liability as a result of the failure of a Consumer Loan conveyed to the Debtor pursuant to Section 2.1(a) above to be conveyed in compliance with all requirements of law (including any Governmental Rules) and for any breach of any of its representations, warranties, covenants or other agreements contained herein, including:

(i)any taxes that may at any time be asserted against any such Person with respect to the transactions contemplated in this Agreement and any of the Loan Documents, including any sales, gross receipts, general corporation, tangible personal property, privilege or license taxes (but, in the case of the Debtor, not including any taxes asserted with respect to federal or other income taxes arising out of payments on the Note) and costs and expenses in defending against the same;

(ii)any loss, liability or expense incurred by reason of the Seller’s willful misfeasance, bad faith or negligence in the performance of its duties under this Agreement, or by reason of reckless disregard of its obligations and duties under this Agreement;

(iii)any and all costs, expenses, losses, claims, damages and liabilities arising out of, or incurred in connection with the acceptance or performance of the trusts and duties set forth herein and in the Loan Documents, except to the extent that such cost, expense, loss, claim, damage or liability shall be due to the willful misfeasance, bad faith or negligence (except for errors in judgment) of such indemnified party; 

(iv)any and all costs, expenses, losses, claims, damages and liabilities arising out of or relating to the Seller’s representations and warranties, covenants or other agreements contained herein or in any other Loan Document to which the Seller is a party; or

(v)any and all costs, expenses, awards, penalties, fines, damages, levies, reasonable and documented attorneys’ fees, or monetary costs of any kind (other than discharges in proceedings under Debtor Relief Laws) arising out of or relating to any (a) Governmental Action pertaining in any way to the Consumer Loans, or (b) any claim, lawsuit, or arbitration of any kind asserted by a non-governmental party related to the Consumer Loans.

(b)Indemnification under this Section 4.3 shall survive the termination of this Agreement and the other Loan Documents and shall include reasonable and documented fees and expenses of counsel.  These indemnity obligations shall be in addition to any obligation that the Seller may otherwise have under applicable law, hereunder or under any other Loan Document.

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Notwithstanding any provision of this Section 4.3 or any other provision of this Agreement, nothing in this Agreement shall be construed as to require the Seller to provide any indemnification hereunder or under any other Loan Document for any costs, expenses, losses, claims, damages or liabilities arising out of, or incurred in connection with, credit losses on or the diminution in value of the Consumer Loans or Other Conveyed Property.

Article V
MISCELLANEOUS

	
Section 5.1
	
Notices.  Except when telephonic notice is expressly authorized by this Agreement, any notices, requests demands, directions, consents, waivers, authorizations or other communications to any party in connection with this Agreement shall be in writing and shall be sent by manual delivery, facsimile transmission, overnight courier, electronic mail or United States mail (postage prepaid) addressed to such party at the address specified in Section 16 of the Loan and Security Agreement.

	
Section 5.2
	
Prior Agreements Superseded.  This Agreement, together with the other Loan Documents, constitutes the sole and entire agreement of the parties hereto and supersedes any prior understandings or written or oral agreements between the parties respecting the subject matter of this Agreement and the other Loan Documents.

	
Section 5.3
	
Amendment.  The parties hereto may not amend, modify or waive any provision hereof without the prior consent of the Lender, except that, following the delivery by the Debtor and the Seller to the Lender of a description of such amendment and an Officer’s Certificate certifying that each of the Debtor and the Seller reasonably believes that such amendment will not have a Material Adverse Effect and is not reasonably expected to have a Material Adverse Effect at any time in the future, the Debtor and the Seller may amend this Agreement for any of the following purposes:

(a)to add to the covenants of the Debtor or the Seller, or to surrender any right or power herein conferred upon the Debtor or the Seller, in each case for the benefit of the Lender;

(b)to cure any ambiguity, or to correct or supplement any provision herein which may be inconsistent with any other provision herein; or

(c)to qualify for sale treatment of the transactions contemplated by this Agreement under GAAP.

	
Section 5.4
	
Parties Bound.  This Agreement shall be binding upon the parties hereto and their respective successors and assigns, and shall inure to the benefit of such parties and their respective successors and permitted assigns.

	
Section 5.5
	
Assignment.  Neither party hereto may assign or delegate its rights, duties or obligations hereunder or interest herein (i) to any entity which is not a Subsidiary of the Seller without (x) the prior consent of the Lender and (y) the assignee executing an agreement of assumption to perform every obligation of the assignor under this Agreement and the other Loan Documents, or (ii) to a Subsidiary of the Seller without (y) the assignor delivering an Officer’s Certificate to the Lender certifying that such assignment or delegation will not have a Material 

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Adverse Effect on the Lender and (x) the assignee executing an agreement of assumption to perform every obligation of the assignor under this Agreement and the other Loan Documents.  Any assignment or other transfer in violation of this provision shall be void.

	
Section 5.6
	
Execution in Counterparts.  This Agreement may be executed in any number of counterparts and by the parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original, and all of which taken together shall constitute but one and the same instrument.  The parties agree that the delivery of this Agreement may be effected by means of an exchange of facsimile or other electronic means (including PDF signatures).

	
Section 5.7
	
Severability of Provisions.  Any provision which is determined to be unconscionable, against public policy or any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction.

	
Section 5.8
	
Further Instruments.  Each party hereto shall from time to time authorize, execute or deliver, and shall cause each of its subsidiaries to authorize, execute or deliver, all such amendments, supplements and other modifications hereto and to the other Loan Documents and all such financing statements or continuation statements, instruments of further assurance and any other instruments, and shall take such other actions, as the Lender reasonably requests and deems necessary or advisable in furtherance of the agreements contained herein.

	
Section 5.9
	
Governing Law.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW) THEREOF.

	
Section 5.10
	
Consent to Jurisdiction.

(a)ALL JUDICIAL PROCEEDINGS BROUGHT AGAINST ANY PARTY HERETO ARISING OUT OF OR RELATING HERETO OR ANY OTHER LOAN DOCUMENT, OR THE NOTE, MAY BE BROUGHT IN ANY STATE OR FEDERAL COURT OF COMPETENT JURISDICTION IN THE STATE, COUNTY AND CITY OF NEW YORK AND THE BOROUGH OF MANHATTAN.  BY EXECUTING AND DELIVERING THIS AGREEMENT, EACH PARTY HERETO, FOR ITSELF AND IN CONNECTION WITH ITS PROPERTIES, IRREVOCABLY (i) ACCEPTS GENERALLY AND UNCONDITIONALLY THE NONEXCLUSIVE JURISDICTION AND VENUE OF SUCH COURTS, (ii) WAIVES ANY DEFENSE OF FORUM NON CONVENIENS, (iii) AGREES THAT SERVICE OF ALL PROCESS IN ANY SUCH PROCEEDING IN ANY SUCH COURT MAY BE MADE BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE APPLICABLE PARTY HERETO AT ITS ADDRESS PROVIDED IN ACCORDANCE WITH SECTION 16 OF THE LOAN AND SECURITY AGREEMENT AND TO ANY PROCESS AGENT SELECTED BY SUCH PARTY IS SUFFICIENT TO CONFER 

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PERSONAL JURISDICTION OVER EACH PARTY HERETO IN ANY SUCH PROCEEDING IN ANY SUCH COURT, AND OTHERWISE CONSTITUTES EFFECTIVE AND BINDING SERVICE IN EVERY RESPECT, AND (iv) AGREES THAT THE LENDER RETAINS THE RIGHT TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO BRING PROCEEDINGS AGAINST ANY PARTY HERETO IN THE COURTS OF ANY OTHER JURISDICTION.

(b)EACH OF THE DEBTOR AND THE SELLER HEREBY AGREES THAT PROCESS MAY BE SERVED ON IT BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, TO THE ADDRESS PERTAINING TO IT AS SPECIFIED IN SECTION 5.1.  ANY AND ALL SERVICE OF PROCESS AND ANY OTHER NOTICE IN ANY SUCH ACTION, SUIT OR PROCEEDING SHALL BE EFFECTIVE AGAINST THE DEBTOR OR THE SELLER IF GIVEN BY REGISTERED OR CERTIFIED MAIL, RETURN RECEIPT REQUESTED, OR BY ANY OTHER MEANS OR MAIL WHICH REQUIRES A SIGNED RECEIPT, POSTAGE PREPAID, MAILED AS PROVIDED ABOVE.  

	
Section 5.11
	
Waiver of Jury Trial.  EACH PARTY HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING HEREUNDER OR UNDER ANY OF THE OTHER LOAN DOCUMENTS OR ANY DEALINGS BETWEEN IT RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT.  THE SCOPE OF THIS WAIVER IS INTENDED TO ENCOMPASS ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  EACH PARTY HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT IT HAS ALREADY RELIED ON THIS WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT IT WILL CONTINUE TO RELY ON THIS WAIVER IN ITS RELATED FUTURE DEALINGS.  EACH PARTY HERETO FURTHER WARRANTS AND REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.  THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY REFERRING TO THIS SECTION 5.11 AND EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR MODIFICATIONS HERETO OR ANY OF THE OTHER LOAN DOCUMENTS OR TO ANY OTHER DOCUMENTS OR AGREEMENTS RELATING TO THE NOTE ISSUED UNDER THE LOAN AND SECURITY AGREEMENT.  IN THE EVENT OF LITIGATION, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE COURT.

	
Section 5.12
	
Third-Party Beneficiaries. The Seller acknowledges that the Debtor has pledged all of its rights, title and interest in and to this Agreement to the Lender. The Lender is an express third-party beneficiary of this Agreement and shall be entitled to enforce this Agreement as if it were a party hereto.

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Section 5.13
	
Termination.  This Agreement shall terminate and be of no further force or effect upon the termination of the Loan and Security Agreement.

 

 

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

				
	
 
	
EFR 2016-2, LLC,
as Debtor

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ David A. Fisher

	
 
	
 
	
Name:
	
David A. Fisher

	
 
	
 
	
Title:
	
President

 

 

 

				
	
 
	
ENOVA INTERNATIONAL, INC.,
as Seller

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
By:
	
/s/ David A. Fisher

	
 
	
 
	
Name:
	
David A. Fisher

	
 
	
 
	
Title:
	
President

 

[Signature Page to Sale Agreement]

 
 

 

EXHIBIT A

[FORM OF] CONSUMER LOANS ASSIGNMENT

For value received, in accordance with the Sale Agreement, dated as of December 1, 2016 (as the same may be amended, restated, supplemented or otherwise modified from time to time in accordance with the terms thereof, the “Sale Agreement”) between EFR 2016-2, LLC, as Debtor (the “Debtor”), and Enova International, Inc., as Seller (the “Seller”), the Seller does hereby sell, transfer, assign, set over and otherwise convey to the Debtor, without recourse (subject to the obligations set forth herein and in the Sale Agreement) all right, title and interest of the Seller in and to the following:

(a)the Related Consumer Loans set forth in the .csv file delivered in connection with this Assignment and all monies received with respect to such Related Consumer Loans on and after the related Cutoff Date;

(b)the Consumer Loan File related to each Related Consumer Loan and any and all other Instruments, including Promissory Notes (each as defined in the Code), if any, and other documents relating to the Related Consumer Loans and the related Obligors acquired by the Seller pursuant to the Transfer Agreement; 

(c)all right, title and interest of the Seller in, to and under the Transfer Agreement;

(d)all present and future claims, demands, causes and choses in action in respect of any of the foregoing, including the right for the Debtor or its assignee to bring any such claim, demand, cause or chose in action in the name of the Seller; and

(e)all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing, including all cash and non-cash proceeds, and other property consisting of, arising from or relating to all or any part of any of the foregoing.

1.Definitions.  All terms defined in the Sale Agreement (whether directly or by reference to other documents) and used herein shall have such defined meanings when used herein, unless otherwise defined herein.

“Cutoff Date” means, with respect to the Consumer Loans and the Other Conveyed Property being conveyed hereby, _____, 20__.

2.Transfer, Assignment and Sale of Consumer Loans.  The Seller hereby certifies that the Related Consumer Loans and Other Conveyed Property assigned to the Debtor hereunder are free and clear of all Liens and that the beneficial interest in and title to such Related Consumer Loans and Other Conveyed Property shall not be part of the Seller’s estate in the event of the filing of a bankruptcy petition by or against the Seller under any bankruptcy law.  In the event that, notwithstanding the intent of the Seller, the transfer and assignment contemplated hereby and under the Sale Agreement is held not to be a sale, the transfer and assignment of such Related Consumer Loans and Other Conveyed Property hereunder shall 

A-1

 

 

constitute a grant of a security interest by the Seller to the Debtor in the property referred to in Section 2 above, which security interest has been assigned to the Lender, and this Assignment and the Sale Agreement shall each constitute a security agreement under applicable law.

3.Further Encumbrance of Consumer Loans and Other Conveyed Property.

(a)Immediately upon the conveyance to the Debtor by the Seller of the Related Consumer Loans and any item of Other Conveyed Property hereto, all right, title and interest of the Seller in and to such Related Consumer Loans and Other Conveyed Property shall terminate and all such right, title and interest shall vest in the Debtor.

(b)Immediately upon the vesting of such Related Consumer Loans and Other Conveyed Property in the Debtor, the Debtor shall have assumed the sole right to pledge or otherwise encumber such Related Consumer Loans and Other Conveyed Property.

4.Governing Law.  THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 AND SECTION 5-1402 OF THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

A-2

 

 

IN WITNESS WHEREOF, the undersigned has caused this Assignment to be duly executed and delivered by a duly authorized officer on the day and year first above written.

 

				
	
 
	
ENOVA INTERNATIONAL, INC.,
as Seller

	
 
	
 
	
 
	
 

	
 
	
 
	
 
	
 

	
 
	
By:
	
 

	
 
	
 
	
Name:
	
 

	
 
	
 
	
Title:
	
 

 

A-3

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