Common use of Realization Upon Defaulted Receivables Clause in Contracts

Realization Upon Defaulted Receivables. (a) In the event that a Receivable becomes and continues to be a Defaulted Receivable, the Servicer shall take all reasonable and lawful steps necessary for Repossession; provided however, that the Servicer shall not be obligated to institute any action for Repossession through judicial proceedings unless it determines in its good faith judgment, which determination will be conclusive and binding, that Liquidation Proceeds that would be realized in connection therewith or amounts payable pursuant to the last sentence of this Section 4.8 would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement. In connection with such Repossession, the Servicer shall follow such practices and procedures required by Section 4.1 and make advances of its own funds for any out-of-pocket expenses incurred. The Servicer shall be reimbursed for Liquidation Expenses (including advances) by retention of the required reimbursement from the first Liquidation Proceeds received with respect to such Defaulted Receivable. The Servicer shall be entitled to receive the following amounts with respect to any Receivable the Obligor of which has filed bankruptcy or against whom a petition for involuntary bankruptcy has been filed: a one time fee of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of the Servicer. (b) In the event the Servicer delivers any Repossessed Financed Vehicle for sale to a Dealer, it agrees that prior to such delivery, it shall make such filings and effect such notices as are necessary under Section 9-114(1) of the New York UCC (or comparable section of the UCC of any applicable state) to preserve its ownership interest (or security interest, as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35.

Realization Upon Defaulted Receivables. (a) In the event that a Receivable becomes and continues to be a Defaulted Receivable, the Servicer shall take all reasonable and lawful steps necessary for Repossession; provided however, that the Servicer shall not be obligated to institute any action for Repossession through judicial proceedings unless it determines in its good faith judgment, which determination will be conclusive and binding, that Insurance Proceeds or Liquidation Proceeds that would be realized in connection therewith or amounts payable pursuant to the last sentence of this Section 4.8 would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement. In connection with such Repossession, the Servicer shall follow such practices and procedures required by Section 4.1 and make advances of its own funds for any out-of-pocket expenses incurred. The Servicer shall be reimbursed for Liquidation Expenses (including advances) by retention of the required reimbursement from the first Liquidation Proceeds or Insurance Proceeds received with respect to such Defaulted Receivable. The Servicer shall be entitled to receive the following amounts with respect to any Receivable the Obligor of which has filed bankruptcy or against whom a petition for involuntary bankruptcy has been filed: a one time fee of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of the Servicer. (b) In the event the Servicer delivers any Repossessed Financed Vehicle for sale to a Dealer, it agrees that prior to such delivery, it shall make such filings and effect such notices as are necessary under Section 9-114(1) of the New York UCC (or comparable section of the UCC of any applicable state) to preserve its ownership interest (or security interest, as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35.

Realization Upon Defaulted Receivables. (a) In Consistent with the event that a Receivable becomes standards, policies and continues to be a Defaulted Receivableprocedures required by this Agreement, the Servicer shall take all use its best efforts to repossess (or otherwise comparably convert the ownership of) and liquidate any Financed Vehicle securing a Receivable with respect to which the Servicer has determined that payments thereunder are not likely to be resumed, promptly after default on such Receivable. The Servicer is authorized to follow such customary practices and procedures as it shall deem necessary or advisable, consistent with the standard of care required by Section 3.1, which practices and procedures may include reasonable efforts to realize upon any recourse to Dealers, selling the related Financed Vehicle at public or private sale, the submission of claims under an Insurance Policy and lawful steps necessary for Repossession; provided howeverother actions by the Servicer in order to realize upon such a Receivable. The foregoing is subject to the provision that, that in any case in which the Financed Vehicle shall have suffered damage, the Servicer shall not be obligated to institute expend funds in connection with any action for Repossession through judicial proceedings repair or towards the repossession of such Financed Vehicle unless it determines shall determine in its good faith judgmentdiscretion that such repair and/or repossession shall increase the proceeds of liquidation of the related Receivable by an amount greater than the amount of such expenses. All Recoveries and liquidation proceeds received upon liquidation of a Financed Vehicle shall be remitted directly by the Servicer, which determination will be conclusive and binding, that Liquidation Proceeds that would be realized in connection therewith or amounts payable pursuant to a servicing account of the Servicer for transfer to the last sentence of this Section 4.8 would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement. In connection with such Repossession, the Servicer shall follow such practices and procedures required by Section 4.1 and make advances of its own funds for any out-of-pocket expenses incurredCollection Account. The Servicer shall be reimbursed for Liquidation Expenses (including advances) by retention pay on behalf of the required Trust any personal property taxes assessed on repossessed Financed Vehicles; the Servicer shall be entitled to reimbursement of any such tax from the first Liquidation Proceeds received Recoveries with respect to such Defaulted Receivable. The Servicer shall be entitled to receive the following amounts with respect not lease any repossessed Financed Vehicle to any Receivable party. In selling or otherwise disposing of any repossessed Financed Vehicle, the Obligor Servicer shall do so as expeditiously as possible and in a manner such that such activities shall not rise to the level of which has filed bankruptcy a trade or against whom a petition for involuntary bankruptcy has been filed: a one time fee business of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of the Servicerselling or otherwise transferring such repossessed Financed Vehicles. (b) In the event If the Servicer delivers elects to commence a legal proceeding to enforce a Dealer Agreement or Dealer Assignment, the act of commencement shall be deemed to be an automatic assignment from the Trustee to the Servicer of the rights under such Dealer Agreement and Dealer Assignment but only to the extent needed for purposes of collection thereunder. If, however, in any Repossessed Financed Vehicle for sale to a Dealerenforcement suit or legal proceeding, it agrees is held that prior the Servicer may not enforce a Dealer Agreement or Dealer Assignment on the grounds that it is not a real party in interest or a Person entitled to enforce the Dealer Agreement or Dealer Assignment, the Trustee, at the Seller's expense, shall take such deliverysteps as the Servicer deems necessary to enforce the Dealer Agreement or Dealer Assignment, it shall make such filings and effect such notices as are necessary under Section 9-114(1) including bringing suit in its name or the name of the New York UCC (Seller or comparable section of the UCC Trustee for the benefit of any applicable state) to preserve its ownership interest (or security interestthe Certificateholders. All amounts recovered shall be remitted directly by the Servicer into the Collection Account, as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35applicable.

Realization Upon Defaulted Receivables. (a) The Servicer will use commercially reasonable efforts consistent with the Servicing Standard and Applicable Law in realizing upon each Defaulted Receivable and Related Security, and employ practices and procedures (including commercially reasonable efforts) to enforce all obligations of Obligors (which may include altering the payment and interest terms of any Defaulted Receivable with the prior written approval of the Borrower). Without limiting the generality of the foregoing, the Servicer may (a) unless the Administrative Agent has specifically given instruction to the contrary, (i) foreclose upon any property securing the Defaulted Receivable and cause the sale of any such property, or (ii) turn the Defaulted Receivable over to a collection agency for collection, or (b) with the consent of the Borrower (other than during the existence of any Event of Default), sell the Defaulted Receivable for its fair market value (as determined by the Servicer in good faith) to an independent third-party purchaser or alter the interest rate or other payment terms of the Defaulted Receivable (whether or not in accordance with the Collection Policy). The Servicer will remit to the Collection Account the Recoveries received in connection with the sale or disposition of a Defaulted Receivable. In addition, the Borrower, with the prior written consent of the Administrative Agent (which shall not be unreasonably withheld), may retain a third party servicer that has been approved in writing by the Administrative Agent to service all (but not less than all) of the Defaulted Receivables owned by the Borrower in the event that a Receivable becomes and continues to be a Defaulted Receivable, the Servicer shall take all reasonable and lawful steps necessary for Repossession; provided however, Borrower determines that the Servicer shall is not be obligated to institute any action for Repossession through judicial proceedings unless it determines servicing the Defaulted Receivables in its good faith judgment, which determination will be conclusive and binding, accordance with the Collection Policy or in a manner consistent with the Servicing Standard; provided that Liquidation Proceeds that would be realized in connection therewith or amounts payable pursuant to (x) the last sentence of this Section 4.8 would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement. In connection with such Repossession, the Servicer shall follow such practices and procedures required by Section 4.1 and make advances of its own funds for any out-of-pocket expenses incurred. The Servicer shall be reimbursed for Liquidation Expenses any reasonable expenses incurred in such a transition pursuant to Section 2.6(b) (such expenses to be limited to the actual cost and expenses incurred by the Servicer, including advancesthe cost of any internal employee utilized in connection with such transition (the cost of such employee not to exceed $125 per hour)) by and (y) any such retention of the required reimbursement from the first Liquidation Proceeds received with respect to such Defaulted Receivable. The Servicer a third party servicer shall be entitled subject to receive the following amounts with respect to any Receivable the Obligor of which has filed bankruptcy or against whom a petition for involuntary bankruptcy has been filed: a one time fee of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of an agreement between the Servicer, the Administrative Agent and CLST (or an Affiliate thereof) whereby CLST (or an Affiliate thereof) shall agree to deposit into the Collection Account an amount equal to the aggregate amounts distributed to the Servicer pursuant to the foregoing clause (x) directly as a result of such transition. (b) Beginning on September 20, 2010, the Servicer shall designate a specified employee whose employment duties shall be restricted solely to the realization upon Defaulted Receivables owned by the Borrower (e.g., the Servicer hereby covenants and agrees that such employee shall not be engaged in the servicing or collection practices for any Receivable not owned by the Borrower as of September 20, 2010). The Borrower may from time to time elect to discontinue the use of such a dedicated Servicer employee and/or to thereafter elect to recommence such use, in either case by providing 30 days prior written notice to the Servicer. The Borrower hereby agrees to reimburse the Servicer for the related costs of such employee on a monthly basis (by the 15th day of the following calendar month) as set forth on Schedule VI (as amended from time to time with the consent of the Servicer, the Borrower and the Administrative Agent), with such reimbursement to be paid by the Borrower out of funds otherwise available to the Borrower (and not from Available Funds); provided that no reimbursement obligations with respect to such an employee shall accrue from the date that is 30 calendar days following the date of any discontinuance notice furnished by the Borrower to the Servicer until such date, if any, as the Borrower elects to resume such arrangement and a dedicated employee is again hired or otherwise assigned on a full-time basis to the realization of Defaulted Receivables owned by the Borrower. For avoidance of doubt, the Borrower shall have no obligation whatsoever to provide benefits to such employee, and the Borrower’s sole liability related to such employee shall be limited to reimbursement of the Servicer of the amounts on Schedule VI. In the event any such employee is terminated or otherwise resigns from the employ of the Servicer, the Servicer delivers any Repossessed Financed Vehicle for sale shall use commercially reasonable efforts to a Dealer, it agrees that prior to fill such delivery, it shall make position unless the Borrower notifies the Servicer such filings and effect such notices as are necessary under position is no longer necessary. (q) Clause (n) in Section 9-114(1) 10.1 of the New York UCC (or comparable section of the UCC of any applicable state) to preserve Credit Agreement is hereby amended and restated in its ownership interest (or security interest, entirety as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35.follows:

Realization Upon Defaulted Receivables. (a) In the event that a Receivable becomes and continues to be a Defaulted Receivable, the The Master Servicer shall take all reasonable foreclose upon or otherwise comparably convert the ownership of the Mortgaged Properties securing such of the Mortgage Loan Receivables as come into and lawful steps necessary continue in default and as to which no satisfactory arrangements can be made for Repossession; provided however, that the Servicer shall not be obligated to institute any action for Repossession through judicial proceedings unless it determines in its good faith judgment, which determination will be conclusive and binding, that Liquidation Proceeds that would be realized in connection therewith or amounts payable collection of delinquent payments pursuant to the last sentence of this Section 4.8 would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement10.2. In connection with such Repossessionforeclosure or other conversion, the Master Servicer shall follow such practices and procedures as it shall deem necessary or advisable and as shall be normal and usual in its general mortgage servicing activities; provided that if the Master Servicer has actual knowledge or reasonably believes that any Mortgaged Property is affected by hazardous or toxic waste or substances, then the Master Servicer need not acquire title to such Mortgaged Property in a foreclosure or similar proceeding. The foregoing is subject to the proviso that the Master Servicer shall not be required by Section 4.1 and make advances of to expend its own funds for in connection with any out-of-pocket expenses incurred. The Servicer foreclosure or to restore any damaged property unless it shall be reimbursed for Liquidation Expenses (including advances) by retention of determine that such foreclosure or restoration will increase the required reimbursement from the first Liquidation Proceeds received with respect available to such Defaulted Receivable. The the Seller after reimbursement to the Master Servicer shall be entitled to receive the following amounts with respect to any Receivable the Obligor of which has filed bankruptcy or against whom a petition for involuntary bankruptcy has been filed: a one time fee of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of the Servicerits Liquidation Expenses. (b) In connection with the event foreclosure or liquidation of any Defaulted Receivable that is a Right to Use Receivable, the Master Servicer delivers any Repossessed Financed Vehicle for sale to a Dealer, it agrees that prior to shall follow such delivery, practices and procedures as it shall make deem necessary or advisable and as shall be normal and usual in its general servicing activities. The Master Servicer shall be required to expend its own funds in connection with the liquidation of any Defaulted Receivable that is a Right to Use Receivable, if it shall determine that such filings and effect such notices as are necessary under Section 9-114(1expenditures will increase the Liquidation Proceeds available to the Seller after reimbursement to the Master Servicer for its Liquidation Expenses. (c) Liquidation Expenses incurred by the Master Servicer can be repaid to the Master Servicer only from Liquidation Proceeds from sale or other disposition of the New York UCC (or comparable section of the UCC of any applicable state) to preserve its ownership interest (or security interest, as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35related Defaulted Receivables.

Realization Upon Defaulted Receivables. (a) In the event that a Receivable becomes and continues to be a Defaulted Receivable, the The Master Servicer shall take all reasonable foreclose upon or otherwise comparably convert the ownership of the Mortgaged Properties securing such of the Mortgage Loan Receivable as come into and lawful steps necessary continue in default and as to which no satisfactory arrangements can be made for Repossession; provided however, that the Servicer shall not be obligated to institute any action for Repossession through judicial proceedings unless it determines in its good faith judgment, which determination will be conclusive and binding, that Liquidation Proceeds that would be realized in connection therewith or amounts payable collection of delinquent payments pursuant to the last sentence of this Section 4.8 would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement10.02. In connection with such Repossessionforeclosure or other conversion, the Master Servicer shall follow such practices and procedures as it shall deem necessary or advisable and as shall be normal and usual in its general mortgage servicing activities; provided that if the Master Servicer has actual knowledge or reasonably believes that any Mortgaged Property is affected by hazardous or toxic waste or substances, then the Master Servicer need not acquire title to such Mortgaged Property in a foreclosure or similar proceeding. The foregoing is subject to the proviso that the Master Servicer shall not be required by Section 4.1 and make advances of to expend its own funds for in connection with any out-of-pocket expenses incurred. The Servicer foreclosure or to restore any damaged property unless it shall be reimbursed for Liquidation Expenses (including advances) by retention of determine that such foreclosure or restoration will increase the required reimbursement from the first Liquidation Proceeds received with respect available to such Defaulted Receivable. The the Seller after reimbursement to the Master Servicer shall be entitled to receive the following amounts with respect to any Receivable the Obligor of which has filed bankruptcy or against whom a petition for involuntary bankruptcy has been filed: a one time fee of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of the Servicerits Liquidation Expenses. (b) In connection with the event foreclosure or liquidation of any Defaulted Receivable that is a Right to Use Receivable, the Master Servicer delivers any Repossessed Financed Vehicle for sale to a Dealer, it agrees that prior to shall follow such delivery, practices and procedures as it shall make deem necessary or advisable and as shall be normal and usual in its general servicing activities. The Master Servicer shall be required to expend its own funds in connection with the liquidation of any Defaulted Receivable that is a Right to Use Receivable, if it shall determine that such filings and effect such notices as are necessary under Section 9-114(1expenditures will increase the Liquidation Proceeds available to the Seller after reimbursement to the Master Servicer for its Liquidation Expenses. (c) Liquidation Expenses incurred by the Master Servicer can be repaid to the Master Servicer only from Liquidation Proceeds from sale or other disposition of the New York UCC (or comparable section of the UCC of any applicable state) to preserve its ownership interest (or security interest, as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35related Defaulted Receivables.

Realization Upon Defaulted Receivables. (a) In the event that a Receivable becomes and continues to be a Defaulted Receivable, the Servicer shall take all reasonable and lawful steps necessary for Repossession; provided however, that the Servicer shall not be obligated to institute any action for Repossession through judicial proceedings unless it determines in its good faith judgment, which determination will be conclusive and binding, that Liquidation Proceeds that would be realized in connection therewith or amounts payable pursuant to the last sentence of this Section 4.8 4.8(a) would be sufficient for the reimbursement in full of its out-of-pocket expenses pursuant to this Agreement. In connection with such Repossession, the Servicer shall follow such practices and procedures required by Section 4.1 and make advances of its own funds for any out-of-pocket expenses incurred. The Servicer shall be reimbursed for Liquidation Expenses (including advances) by retention of the required reimbursement from the first Liquidation Proceeds received with respect to such Defaulted Receivable. The Servicer shall be entitled to receive the following amounts with respect to any Receivable the Obligor of which has filed bankruptcy or against whom a petition for involuntary bankruptcy has been filed: a one time fee of $200 in respect of those Receivables not referred to outside legal counsel, or, in the case of those Receivables that are so referred, reimbursement of the reasonable fees and expenses of outside legal counsel, if their retention was necessary in the reasonable judgment of the Servicer. (b) In the event the Servicer delivers any Repossessed Financed Vehicle for sale to a Dealer, it agrees that prior to such delivery, it shall make such filings and effect such notices as are necessary under Section 9-114(1) of the New York UCC (or comparable section of the UCC of any applicable state) to preserve its ownership interest (or security interest, as the case may be) in any such Repossessed Financed Vehicle. The Servicer agrees that at any time after 45 days from the Closing Date the aggregate number of unliquidated Repossessed Financed Vehicles delivered for sale to all Dealers with respect to which the actions referred to in the prior sentence have not been effected shall not exceed the lesser of (i) 35 Repossessed Financed Vehicles or (ii) 20% of the aggregate number of unliquidated Repossessed Financed Vehicles. The Servicer further agrees that the number of unliquidated Repossessed Financed Vehicles delivered for sale to any individual Dealer shall at no time exceed 35.