EXECUTION VERSION 753507386 23738694 SALE AND SERVICING AGREEMENT by and among ACM AUTO TRUST 2023 - 2, as Issuer ACM FUNDING, LLC, as Seller AMERICA’S CAR MART, INC., as Servicer and WILMINGTON TRUST, NATIONAL ASSOCIATION, as Indenture Trustee,...
Exhibit 10.2
EXECUTION VERSION 753507386 23738694 SALE AND SERVICING AGREEMENT by and among ACM AUTO TRUST 2023 - 2, as Issuer ACM FUNDING, LLC, as Seller AMERICA’S CAR MART, INC., as Servicer and WILMINGTON TRUST, NATIONAL ASSOCIATION, as Indenture Trustee, Backup Servicer, Calculation Agent and Paying Agent Dated as of July 6, 2023
753507386 23738694 i Sale and Servicing Agreement (ACMAT 2023 - 2) TABLE OF CONTENTS Page ARTICLE I DEFINITIONS AND USAGE .................................................................................. 1 SECTION 1.1 SECTION 1.2 Definitions............................................................................................ 1 Other Interpretive Provisions ............................................................... 1 ARTICLE II CONVEYANCE OF TRANSFERRED ASSETS ................................................... 2 SECTION 2.1 SECTION 2.2 Conveyance of Transferred Assets ...................................................... 2 Custody of Receivable Files. ............................................................... 2 ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES AND TRUST PROPERTY ....................................................................................... 4 SECTION 3.1 SECTION 3.2 SECTION 3.3 Duties of Servicer ................................................................................ 4 Collection of Receivable Payments. .................................................... 6 Repossession of Financed Vehicles; Sales of Deficiency Balances ............................................................................................... 7 Maintenance of Security Interests in Financed Vehicles ..................... 8 Covenants of Servicer .......................................................................... 8 Purchase of Receivables Upon Breach ................................................ 8 Servicing Fee ....................................................................................... 9 Monthly Data File ................................................................................ 9 Annual Officer’s Certificate; Notice of Servicer Replacement Event. ................................................................................................... 9 Servicer Expenses .............................................................................. 10 Exchange Act Filings ......................................................................... 10 Calculation Agent .............................................................................. 10 SECTION 3.4 SECTION 3.5 SECTION 3.6 SECTION 3.7 SECTION 3.8 SECTION 3.9 SECTION 3.10 SECTION 3.11 SECTION 3.12 ARTICLE IV DISTRIBUTIONS; ACCOUNTS STATEMENTS TO THE CERTIFICATEHOLDERS AND THE NOTEHOLDERS ........................... 10 SECTION 4.1 SECTION 4.2 SECTION 4.3 SECTION 4.4 SECTION 4.5 SECTION 4.6 SECTION 4.7 Establishment of Accounts. ............................................................... 10 Remittances........................................................................................ 14 Additional Deposits and Payments. ................................................... 14 Distributions....................................................................................... 15 Net Deposits....................................................................................... 16 Statements to Noteholders and Certificateholders ............................. 16 No Duty to Confirm ........................................................................... 18 ARTICLE V THE SELLER ........................................................................................................ 18 SECTION 5.1 SECTION 5.2 SECTION 5.3 Representations and Warranties of Seller .......................................... 18 Liability of Seller; Indemnities .......................................................... 20 Merger or Consolidation of, or Assumption of the Obligations of, Seller ............................................................................................. 21 Limitation on Liability of Seller and Others...................................... 21 Seller May Own Notes....................................................................... 22 Compliance with Organizational Documents .................................... 22 SECTION 5.4 SECTION 5.5 SECTION 5.6
753507386 23738694 ii Sale and Servicing Agreement (ACMAT 2023 - 2) TABLE OF CONTENTS (continued) Page ARTICLE VI THE SERVICER .................................................................................................. 22 SECTION 6.1 SECTION 6.2 SECTION 6.3 Representations of Servicer ............................................................... 22 Indemnities of Servicer ...................................................................... 23 Merger or Consolidation of, or Assumption of the Obligations of, Servicer ......................................................................................... 25 Limitation on Liability of Servicer and Others.................................. 25 Delegation of Duties .......................................................................... 26 America’s Car Mart Servicing Not to Resign as Servicer ................. 26 Servicer May Own Notes................................................................... 26 SECTION 6.4 SECTION 6.5 SECTION 6.6 SECTION 6.7 ARTICLE VII TERMINATION OF SERVICER ....................................................................... 26 SECTION 7.1 SECTION 7.2 SECTION 7.3 SECTION 7.4 SECTION 7.5 Termination and Replacement of Servicer. ....................................... 26 Notification to Noteholders................................................................ 28 Limitation of Liability of Successor Servicer .................................... 28 Reliance on Work Product ................................................................. 29 Initial Servicer’s Agent ...................................................................... 30 ARTICLE VIII CLEAN - UP CALL............................................................................................. 30 SECTION 8.1 Clean - Up Call by Servicer ................................................................. 30 ARTICLE IX MISCELLANEOUS PROVISIONS..................................................................... 31 SECTION 9.1 SECTION 9.2 SECTION 9.3 SECTION 9.4 SECTION 9.5 SECTION 9.6 SECTION 9.7 SECTION 9.8 SECTION 9.9 SECTION 9.10 SECTION 9.11 SECTION 9.12 SECTION 9.13 SECTION 9.14 SECTION 9.15 SECTION 9.16 SECTION 9.17 SECTION 9.18 SECTION 9.19 SECTION 9.20 Amendment........................................................................................ 31 Protection of Title. ............................................................................. 32 Other Liens or Interests...................................................................... 33 Transfers Intended as Sale; Security Interest..................................... 34 Information Requests ......................................................................... 34 Notices, Etc ........................................................................................ 35 Choice of Law.................................................................................... 35 Headings ............................................................................................ 35 Counterparts and Electronic Signature .............................................. 35 Waivers .............................................................................................. 36 Entire Agreement ............................................................................... 36 Severability of Provisions .................................................................. 36 Binding Effect .................................................................................... 36 Acknowledgment and Agreement...................................................... 36 Cumulative Remedies ........................................................................ 36 Nonpetition Covenant ........................................................................ 36 Submission to Jurisdiction; Waiver of Jury Trial .............................. 37 Limitation of Liability........................................................................ 37 Third - Party Beneficiaries................................................................... 38 Information to Be Provided by the Indenture Trustee ....................... 38
753507386 23738694 iii Sale and Servicing Agreement (ACMAT 2023 - 2) TABLE OF CONTENTS (continued) Page Schedule I Notice Addresses .................................................................................................. I - 1 Exhibit A Form of Assignment pursuant to Sale and Servicing Agreement....................... A - 1 Exhibit B Perfection Representations, Warranties and Covenants ......................................B - 1 Exhibit C Monthly Data File ................................................................................................C - 1 Appendix A Definitions
753507386 23738694 Sale and Servicing Agreement (ACMAT 2023 - 2) SALE AND SERVICING AGREEMENT, is made and entered into as of July 6, 2023 (as amended, restated, supplemented or otherwise modified and in effect from time to time, this “ Agreement ”), by and among ACM AUTO TRUST 2023 - 2, a Delaware statutory trust (the “ Issuer ”), ACM FUNDING, LLC, a Delaware limited liability company, as seller (the “ Seller ”), AMERICA’S CAR MART, INC., an Arkansas corporation (“ America’s Car Mart ”), as servicer (in such capacity, the “ Servicer ”) and WILMINGTON TRUST, NATIONAL ASSOCIATION, a national banking association, as indenture trustee (in such capacity, the “ Indenture Trustee ”), as backup servicer (in such capacity, the “ Backup Servicer ”), as paying agent (in such capacity, the “ Paying Agent ”) and as calculation agent (in such capacity, the “ Calculation Agent ”). WHEREAS, the Issuer desires to purchase from the Seller a portfolio of motor vehicle receivables, including motor vehicle retail installment sales contracts that are secured by used automobiles, light - duty trucks, SUVs and vans ; WHEREAS, the Seller is willing to sell such portfolio of motor vehicle receivables and related property to the Issuer ; and WHEREAS, America’s Car Mart is willing to service such motor vehicle receivables and related property on behalf of the Issuer; NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto, intending to be legally bound, agree as follows: ARTICLE I DEFINITIONS AND USAGE SECTION 1.1 Definitions . Except as otherwise defined herein or as the context may otherwise require, capitalized terms used but not otherwise defined herein are defined in Appendix A hereto, which also contains rules as to usage that are applicable herein. Other Interpretive Provisions . For purposes of this Agreement, unless the context otherwise requires: (a) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under GAAP (provided that, to the extent that the definitions in this Agreement and GAAP conflict, the definitions in this Agreement shall control); (b) terms defined in Article 9 of the UCC as in effect in the relevant jurisdiction and not otherwise defined in this Agreement are used as defined in that Article; (c) the words “hereof,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole and not to any particular provision of this Agreement; (d) references to any Article, Section, Schedule, Appendix or Exhibit are references to Articles, Sections, Schedules, Appendices and Exhibits in or to this Agreement and references to any paragraph, subsection, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (e) the term “including” and all variations thereof means “including without limitation”; (f) except as otherwise expressly provided herein, references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (g) references to any Person include that Person’s successors and assigns; and (h) headings are for
753507386 23738694 2 Sale and Servicing Agreement (ACMAT 2023 - 2) purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. ARTICLE II CONVEYANCE OF TRANSFERRED ASSETS SECTION 2.1 Conveyance of Transferred Assets . In consideration of the Issuer’s sale and delivery to, or upon the order of, the Seller of all of the Notes and the Certificate on the Closing Date, the Seller does hereby irrevocably sell, transfer, assign, contribute and otherwise convey to the Issuer without recourse (subject to the obligations herein) all right, title and interest of the Seller, whether now owned or hereafter acquired, in, to and under the Transferred Assets, as evidenced by an assignment substantially in the form of Exhibit A delivered on the Closing Date. The sale, transfer, assignment and conveyance made hereunder does not constitute and is not intended to result in an assumption by the Issuer of any obligation of the Seller or the Originators to the Obligors, insurers or any other Person in connection with the Receivables or the other assets and properties conveyed hereunder or any agreement, document or instrument related thereto. SECTION 2.2 Custody of Receivable Files . (a) Custody . The Issuer and the Indenture Trustee, not in its individual capacity but solely as Indenture Trustee, upon the execution and delivery of this Agreement, hereby revocably appoint the Servicer, and the Servicer hereby accepts such appointment, to act as the agent of the Issuer and the Indenture Trustee as custodian of the Receivable Files, which are hereby or will hereby be constructively delivered to the Indenture Trustee (or its agent or designee), as pledgee of the Issuer pursuant to the Indenture. “ Receivable File ” means, with respect to each Receivable, the following documents or instruments (but only to the extent applicable to such Receivable), which may be held in tangible paper form or electronic form: (i) the fully executed original related to such Receivable, including any written amendments or extensions thereto; (ii) the original Certificate of Title or, if not yet received, evidence that an application therefor has been submitted with the appropriate authority or the applicable document (electronic or otherwise, as used in the applicable jurisdiction) that the Servicer keeps on file, in accordance with its Customary Servicing Practices, evidencing the security interest of the Originator in the Financed Vehicle; and (iii) any and all other documents that the applicable Originator, the Servicer or the Seller keeps on file, in accordance with its Customary Servicing Practices, relating to a Receivable, an Obligor or a Financed Vehicle. (b) Safekeeping . The Servicer, in its capacity as custodian, shall hold the Receivable Files for the benefit of the Issuer and the Indenture Trustee, as pledgee of the Issuer. In performing its duties as custodian, the Servicer shall act in accordance with its Customary Servicing Practices. The Servicer will promptly report to the Issuer and the Indenture Trustee
753507386 23738694 3 Sale and Servicing Agreement (ACMAT 2023 - 2) any failure on its part to hold a material portion of the Receivable Files or to maintain its accounts, records, and computer systems as herein provided and shall promptly take appropriate action to remedy any such failure. Nothing herein will be deemed to require an initial review or any periodic review by the Issuer or the Indenture Trustee of the Receivable Files. The Servicer may, in accordance with its Customary Servicing Practices: (i) maintain all or a portion of the Receivable Files in electronic form and (ii) maintain custody of all or any portion of the Receivable Files with one or more of its agents or designees. (c) Maintenance of and Access to Records . The Servicer will maintain each Receivable File in the United States (it being understood that the Receivable Files, or any part thereof, may be maintained at the offices of any Person to whom the Servicer has delegated responsibilities in accordance with Section 6.5 ). The Servicer will make available to the Issuer and the Indenture Trustee or their duly authorized representatives, attorneys or auditors a list of locations of the Receivable Files upon request. The Servicer will provide access to the Receivable Files, and the related accounts records, and computer systems maintained by the Servicer at such times as the Issuer or the Indenture Trustee direct, but only upon reasonable notice and during the normal business hours at the respective offices of the Servicer. (d) Release of Documents . Upon written instructions from the Indenture Trustee, the Servicer will release or cause to be released any document in the Receivable Files to the Indenture Trustee, the Indenture Trustee’s agent or the Indenture Trustee’s designee, as the case may be, at such place or places as the Indenture Trustee may designate, as soon thereafter as is practicable. Any document so released will be handled by the Indenture Trustee, its agent or designee, as the case may be, with reasonable care and returned to the Servicer for safekeeping as soon as the Indenture Trustee or its agent or designee, as the case may be, has no further need therefor. (e) Instructions ; Authority to Act . All instructions from the Indenture Trustee will be in writing and signed by an Authorized Officer of the Indenture Trustee, and the Servicer will be deemed to have received proper instructions with respect to the Receivable Files upon its receipt of such written instructions . (f) Custodian’s Indemnification . Subject to Section 6.2 , the Servicer as custodian will indemnify the Issuer, the Owner Trustee and the Indenture Trustee for any and all liabilities, obligations, losses, compensatory damages, payments, costs, or expenses (including reasonable attorneys’ fees and expenses and court costs and any losses incurred in connection with a successful defense, in whole or part, of any claim that the Indenture Trustee or the Owner Trustee breached its standard of care and legal fees and expenses incurred in actions against the indemnifying party) of any kind whatsoever that may be imposed on, incurred by or asserted against the Issuer, the Owner Trustee or the Indenture Trustee as the result of any improper act or omission in any way relating to the maintenance and custody by the Servicer as custodian of the Receivable Files or the enforcement of the Issuer’s, the Owner Trustee’s or the Indenture Trustee’s rights (including indemnification rights) under the Transaction Documents; provided , however , that the Servicer as custodian will not be liable (i) to the Indenture Trustee, the Owner Trustee or the Issuer for any portion of any such amount resulting from the willful misconduct, bad faith or gross negligence of the Indenture Trustee, the Owner Trustee or the Issuer, respectively, or (ii) to the Indenture Trustee for any portion of any such amount resulting from
753507386 23738694 4 Sale and Servicing Agreement (ACMAT 2023 - 2) the failure of the Indenture Trustee, the Indenture Trustee’s agent or the Indenture Trustee’s designee to handle with reasonable care any Certificate of Title or other document released to the Indenture Trustee, the Indenture Trustee’s agent or the Indenture Trustee’s designee pursuant to Section 2.2(d) . The provisions of this Section 2.2(f) shall survive the termination or assignment of this Agreement and the resignation or removal of the Indenture Trustee or the Servicer, in its capacity as custodian. The Servicer shall not be responsible for any loss occasioned by the failure of the Indenture Trustee or its agent or designee to return any documents or any delay in doing so. (g) Effective Period and Termination . The Servicer’s appointment as custodian will become effective as of the Cut - Off Date and will continue in full force and effect until terminated pursuant to this Section. If America’s Car Mart resigns as Servicer in accordance with the provisions of this Agreement or if all of the rights and obligations of the Servicer have been terminated under Section 7.1 , the appointment of the Servicer as custodian hereunder may be terminated by the Indenture Trustee (acting at the direction of the Noteholders representing at least a majority of the Note Balance of the Controlling Class), or by the Noteholders of Notes evidencing not less than a majority of the Note Balance of the Controlling Class (or, if the Notes are no longer Outstanding, by the Majority Certificateholders), in the same manner as the Indenture Trustee or such Noteholders (or Certificateholders) may terminate the rights and obligations of the Servicer under Section 7.1 . As soon as practicable after any termination of such appointment, the Servicer will deliver to the Successor Servicer the Receivable Files and the related accounts and records maintained by the Servicer at such place or places as the Indenture Trustee may reasonably designate. (h) Liability of Indenture Trustee . The Indenture Trustee shall not be liable for the acts or omissions of the Servicer, in its capacity as custodian of the Receivable Files. ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES AND TRUST PROPERTY SECTION 3.1 Duties of Servicer . (a) Subject to the limitations set forth in Article VII with respect to any Successor Servicer, the Servicer is hereby appointed by the Issuer and authorized to act as agent for the Issuer and in such capacity shall manage, service, administer and make collections on the Receivables, and perform the other actions required by the Servicer under this Agreement. The Servicer agrees that its servicing of the Receivables will be carried out in accordance with its Customary Servicing Practices, using the degree of skill and attention that the Servicer exercises with respect to all comparable motor vehicle receivables that it services for itself or others. The Servicer’s duties will include collection and posting of all payments, responding to inquiries of Obligors on such Receivables, investigating delinquencies, providing invoices or payment coupons (which may be in electronic form) to Obligors, reporting any required tax information to Obligors, accounting for Collections and furnishing monthly and annual statements to the Calculation Agent with respect to collections and performing the other duties specified herein. The Servicer is not required under the Transaction Documents to make any disbursements via
753507386 23738694 5 Sale and Servicing Agreement (ACMAT 2023 - 2) wire transfer or otherwise on behalf of an Obligor. There are no requirements under the Receivables or the Transaction Documents for funds to be, and funds shall not be, held in trust for an Obligor. There are no requirements under the Receivables or the Transaction Documents for payments or disbursements to be made by the Servicer on behalf of the Obligor. The Servicer hereby accepts such appointment and authorization and agrees to perform the duties of Servicer with respect to the Receivables set forth herein. Notwithstanding anything to the contrary in this Agreement or any other Transaction Document, the Servicer shall not be liable for any failure or delay in the performance of its obligations or the taking of any action hereunder or under any other Transaction Document (and such failure or delay shall not constitute a breach of any Transaction Document or a Servicer Replacement Event) if such failure or delay arises from compliance by the Servicer with any law or court order, the direction of a regulatory authority or regulatory guidance. (b) Subject to the provisions of Section 3.2 and any other provisions in this Agreement restricting the Servicer or specifying obligations different from the Customary Servicing Practices, the Servicer will follow its Customary Servicing Practices and will have full power and authority to do any and all things in connection with such managing, servicing, administration and collection that it may deem necessary or desirable. Without limiting the generality of the foregoing, the Servicer is hereby authorized and empowered to execute and deliver, on behalf of itself, the Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders, the Certificateholders, or any of them, any and all instruments of satisfaction or cancellation, or partial or full release or discharge, and all other comparable instruments, with respect to the Receivables or to the Financed Vehicles securing such Receivables. The Servicer is hereby authorized to commence, in its own name or in the name of the Issuer, a Proceeding to enforce a Receivable or an Insurance Policy or to commence or participate in any other Proceeding (including a bankruptcy proceeding) relating to or involving a Receivable, an Obligor, a Financed Vehicle or an Insurance Policy. If the Servicer commences a Proceeding to enforce a Receivable or an Insurance Policy, the Issuer will thereupon be deemed to have automatically assigned such Receivable or its rights under such Insurance Policy to the Servicer solely for purposes of commencing or participating in any such Proceeding as a party or claimant, and the Servicer is authorized and empowered by the Issuer to execute and deliver in the Servicer’s name any notices, demands, claims, complaints, responses, affidavits or other documents or instruments in connection with any such Proceeding. If in any enforcement suit or Proceeding it is held that the Servicer may not enforce a Receivable or Insurance Policy on the ground that it is not a real party in interest or a holder entitled to enforce the Receivable or Insurance Policy, the Issuer will, at the Servicer’s expense and direction, take steps to enforce the Receivable or Insurance Policy, including bringing suit in its name. The Issuer will furnish the Servicer with any powers of attorney and other documents reasonably necessary or appropriate to enable the Servicer to carry out its servicing and administrative duties hereunder. The Servicer, at its expense, will obtain on behalf of the Issuer all licenses, if any, required by the laws of any jurisdiction to be held by the Issuer in connection with ownership of the Receivables, and will make all filings and pay all fees as may be required in connection therewith during the term hereof. Notwithstanding the foregoing, if the initial Servicer has been replaced by a Successor Servicer, any expenses or fees payable by the Servicer pursuant to this clause (b) shall be reimbursable by the Issuer in accordance with Section 4.4(a) of this Agreement or Section 5.4(b) of the Indenture, as applicable.
753507386 23738694 6 Sale and Servicing Agreement (ACMAT 2023 - 2) (c) The Servicer hereby agrees to perform its obligations under the Backup Servicing Agreement and agrees that upon its resignation and the appointment of a successor Servicer hereunder, the Servicer will terminate its activities as Servicer hereunder in accordance with Section 7.1 , and, in any case, in a manner which will facilitate the transition of the performance of such activities to such successor Servicer, and the Servicer shall cooperate with and assist such successor Servicer. (d) The Servicer shall not be required to monitor whether Obligors maintain an Insurance Policy on the Financed Vehicles. SECTION 3.2 Collection of Receivable Payments . (a) The Servicer will make reasonable efforts to collect all payments called for under the terms and provisions of the Receivables as and when the same become due in accordance with its Customary Servicing Practices. The Servicer may grant extensions, rebates, deferrals, amendments, modifications or adjustments with respect to any Receivable in accordance with its Customary Servicing Practices. Notwithstanding the foregoing, if the Servicer (i) extends the date for final payment by the Obligor of any Receivable beyond the last day of the Collection Period immediately preceding the latest Final Scheduled Payment Date of any Class of Notes issued under the Indenture or (ii) reduces the Contract Rate or Principal Balance with respect to any Receivable other than (A) as required by applicable law or court order, (B) in connection with a modification, adjustment or settlement in the event the Receivable becomes a Defaulted Receivable, (C) in connection with a Cram Down Loss relating to such Receivable, (D) in connection with the application by the Servicer of payments received from either of the Originators and applied to reduce the Principal Balance of such Receivable, (E) at the direction of a regulatory authority or in accordance with regulatory guidance or (F) if the related Obligor is a servicemember in military service or is the spouse of a dependent of a servicemember, it will either correct such action or promptly purchase such Receivable in the manner provided in, and subject to the conditions set forth in, Section 3.6 . The Servicer may in its discretion waive any late payment charge or any other fees that may be collected in the ordinary course of servicing a Receivable. The Servicer shall not be required to make any advances of funds or guarantees regarding collections, cash flows or distributions. Payments on the Receivables, including payoffs, made in accordance with the related documentation for such Receivables, shall be posted to the Servicer’s Obligor records in accordance with the Servicer’s Customary Servicing Practices. Such payments shall be allocated to principal, interest or other items in accordance with the related documentation for such Receivables. (b) Subject to the third sentence of Section 3.2(a) , the Servicer and its Affiliates may engage in any marketing practice or promotion or any sale of any products, goods or services to Obligors with respect to the related Receivables so long as such practices, promotions or sales are offered to obligors of comparable motor vehicle receivables serviced by the Servicer for itself and others, whether or not such practices, promotions or sales might result in a decrease in the aggregate amount of payments on the Receivables, prepayments or faster or slower timing of the payment of the Receivables. (c) Notwithstanding anything in this Agreement to the contrary, the Servicer may refinance any Receivable and deposit the full outstanding Principal Balance of such Receivable
753507386 23738694 11 Sale and Servicing Agreement (ACMAT 2023 - 2) payment in full of the principal of and interest on the Notes, for the benefit of the Certificateholders, in the name of the Issuer, a non - interest bearing Eligible Account, bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Certificateholders, which Eligible Account shall be established by and maintained with the Paying Agent or its designee (the “ Collection Account ”). No checks shall be issued, printed or honored with respect to the Collection Account. (ii) For the benefit of the Noteholders and the Issuer, in the name of the Indenture Trustee, a non - interest bearing Eligible Account (the “ Reserve Account ”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Noteholders and the Issuer, which Eligible Account shall be established by and maintained with the Indenture Trustee or its designee. No checks shall be issued, printed or honored with respect to the Reserve Account. (b) Funds on deposit in the Collection Account and the Reserve Account (collectively, the “ Trust Accounts ”), if any, shall be invested by the Indenture Trustee in Eligible Investments selected in writing by the Servicer and of which the Servicer provides notification (pursuant to standing instructions or otherwise); provided that it is understood and agreed that neither the Servicer, the Indenture Trustee (subject to Section 6.1(c) of the Indenture) nor the Issuer shall be liable for any loss arising from such investment in Eligible Investments. Absent such instructions or standing instructions, the funds shall remain uninvested. All such Eligible Investments shall be held by or on behalf of the Indenture Trustee as secured party for the benefit of the Noteholders and the Issuer (or if there are no Noteholders, for the Certificateholders); provided , that on each Payment Date, pursuant to written instructions from the Servicer (which may include standing instructions), all interest and other investment income (net of losses and investment expenses) on funds on deposit in the Trust Accounts shall be distributed to the Servicer and shall not be available to pay the distributions provided for in Section 4.4 . Except to the extent that the Rating Agency Condition is satisfied, all investments of funds on deposit in the Trust Accounts shall mature so that such funds will be available on the Business Day immediately preceding the immediately following Payment Date. No Eligible Investment shall be sold or otherwise disposed of prior to its scheduled maturity unless a default occurs with respect to such Eligible Investment and the Servicer directs the Indenture Trustee in writing to dispose of such Eligible Investment. The Servicer acknowledges that upon its written request and at no additional cost, it has the right to receive notification after the completion of each purchase and sale of permitted investments or the Indenture Trustee’s receipt of a broker’s confirmation. The Servicer agrees that such notifications shall not be provided by the Indenture Trustee hereunder, and the Indenture Trustee shall make available, upon request and in lieu of notifications, periodic account statements that reflect such investment activity. (c) The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Trust Accounts and in all proceeds thereof and all such funds, investments and proceeds shall be part of the Trust Estate. Except as otherwise provided herein, the Trust Accounts shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Noteholders (or if there are no Noteholders, for the Certificateholders). If, at any time, any Trust Account ceases to be an Eligible Account, the Servicer shall promptly notify the
753507386 23738694 12 Sale and Servicing Agreement (ACMAT 2023 - 2) Indenture Trustee in writing (unless such Trust Account is an account with the Indenture Trustee) and within thirty (30) days (or any longer period if the Rating Agency Condition is satisfied with respect to such longer period) after becoming aware of the fact, establish a new Trust Account as an Eligible Account and shall direct the Indenture Trustee in writing to transfer any cash and/or any investments to such new Trust Account. (d) With respect to the Trust Account Property, the parties hereto agree that: (i) any Trust Account Property that consists of uninvested funds shall be held solely in Eligible Accounts and, except as otherwise provided herein, each such Eligible Account shall be subject to the exclusive custody and control of the Indenture Trustee, and, except as otherwise provided in the Transaction Documents, the Indenture Trustee or its designee shall have sole signature authority with respect thereto; (ii) any Trust Account Property that constitutes Physical Property shall be delivered to the Indenture Trustee or its designee, in accordance with paragraph (a) of the definition of “Delivery” and shall be held, pending maturity or disposition, solely by the Indenture Trustee or any such designee; (iii) any Trust Account Property that is an “uncertificated security” under Article 8 of the UCC and that is not governed by clause (iv) below shall be delivered to the Indenture Trustee or its designee in accordance with paragraph (c) of the definition of “Delivery” and shall be maintained by the Indenture Trustee or such designee, pending maturity or disposition, through continued registration of the Indenture Trustee’s (or its designee’s) ownership of such security on the books of the issuer thereof; (iv) any Trust Account Property that is an uncertificated security that is a “book - entry security” (as such term is defined in Federal Reserve Bank Operating Circular No. 7) held in a securities account at a Federal Reserve Bank and eligible for transfer through the Fedwire ® Securities Service operated by the Federal Reserve System pursuant to Federal book - entry regulations shall be delivered in accordance with paragraph (b) of the definition of “Delivery” and shall be maintained by the Indenture Trustee or its designee or a securities intermediary (as such term is defined in Section 8 - 102(a)(14) of the UCC) acting solely for the Indenture Trustee or such designee, pending maturity or disposition, through continued book - entry registration of such Trust Account Property as described in such paragraph; and (v) to the extent any Trust Account Property is credited to a securities account, the account agreement establishing such securities account shall provide that the account agreement is governed solely by the law of the State of New York and that the law of the State of New York shall govern all issues specified in Article 2(1) of the Hague Securities Convention;
753507386 23738694 13 Sale and Servicing Agreement (ACMAT 2023 - 2) such institution acting as securities intermediary shall have at the time of entry of the account agreement and shall continue to have at all relevant times one or more offices (within the meaning of the Hague Securities Convention) in the United States of America which satisfies the criteria provided in Article 4(1)(a) or (b) of the Hague Securities Convention; the jurisdiction of such institution acting as securities intermediary with respect to such securities account shall be the State of New York; and (if the Indenture Trustee is not the securities intermediary with respect to such securities account) the Indenture Trustee, the Issuer and such securities intermediary shall agree in writing that such securities intermediary will comply with entitlement orders originated by the Indenture Trustee with respect to such securities account without further consent of the Issuer. (e) The Indenture Trustee, to the extent it is acting in the capacity of securities intermediary with respect to the Trust Account Property, represents, warrants and covenants that: (i) it is a “securities intermediary,” as such term is defined in Section 8 - 102(a)(14)(ii) of the relevant UCC, that in the ordinary course of its business maintains “securities accounts” for others, as such term is used in Section 8 - 501 of the relevant UCC, and an “intermediary” as defined in the Hague Securities Convention; (ii) pursuant to Section 8 - 110(e)(1) of the relevant UCC for purposes of the relevant UCC, the jurisdiction of the Indenture Trustee as securities intermediary is the State of New York. Further, the law of the State of New York shall govern all issues specified in Article 2(1) of the Hague Securities Convention; and (iii) the Indenture Trustee has and shall continue to have at all relevant times one or more offices (within the meaning of the Hague Securities Convention) in the United States of America engaged in a business or other regular activity of maintaining securities accounts. (f) To the extent that there are any other agreements with the Indenture Trustee governing the Trust Accounts, the parties agree that each and every such agreement is hereby amended to provide that, with respect to the Trust Accounts, the law applicable to all issues specified in Article 2(1) of the Hague Securities Convention shall be the laws of the State of New York. (g) Except for the Collection Account and the Reserve Account, there are no accounts required to be maintained under the Transaction Documents.
753507386 23738694 17 Sale and Servicing Agreement (ACMAT 2023 - 2) (b) the Class A Note Balance and the Class B Note Balance, with respect to each Class of Notes, in each case after giving effect to payments on such Payment Date; (c) the First Allocation of Principal, the Second Allocation of Principal and the Regular Allocation of Principal for such Payment Date; (d) (i) the amount on deposit in the Reserve Account and the Specified Reserve Account Balance, each as of the beginning and end of the related Collection Period, (ii) the amount to be deposited in the Reserve Account in respect of such Payment Date, if any, (iii) the Reserve Account Draw Amount, if any, to be withdrawn from the Reserve Account on such Payment Date and (iv) the balance on deposit in the Reserve Account on such Payment Date after giving effect to withdrawals therefrom and deposits thereto in respect of such Payment Date; (e) the Pool Balance, the Pool Factor and the Note Factor as of the close of business on the last day of the preceding Collection Period; (f) the amount of the Servicing Fee to be paid to the Servicer with respect to the related Collection Period and the amount of any unpaid Servicing Fees and the change in such amount from the prior Payment Date; (g) the amount of fees to be paid to the Indenture Trustee, the Paying Agent, the Backup Servicer, the Owner Trustee, the Certificate Registrar and the Calculation Agent with respect to the related Payment Date and the amount of any unpaid fees to such parties and any changes in such amount from the prior Payment Date; (h) the amount of the Class A Noteholders’ Interest Carryover Shortfall and the Class B Noteholders’ Interest Carryover Shortfall, if any, on such Payment Date; (i) the aggregate Repurchase Price with respect to Repurchased Receivables paid by the Servicer or America’s Car Mart with respect to the related Collection Period; (j) the number, dollar amount and percentage of Receivables that are 31 - 60, 61 - 90 and over 90 days delinquent as of the end of the related Collection Period; provided , however , that the Servicer may, in its sole discretion, provide the information set forth in this clause (j) in 30 - day increments beginning with 30 - 59 days delinquent in lieu of the foregoing increments.; and (k) the dollar amount and percentage of Receivables that are subject to deferrals and extensions as of the end of the related Collection Period . Each amount set forth pursuant to clause (a) or (h) above relating to the Notes shall be expressed as a dollar amount per $1,000 of the aggregate principal amount of the Notes (or Class thereof). No disbursements shall be made directly by the Servicer to a Noteholder, and the Servicer shall not be required to maintain any investor record relating to the posting of disbursements or otherwise.
753507386 23738694 24 Sale and Servicing Agreement (ACMAT 2023 - 2) indemnifying party), losses, damages, claims and liabilities, arising out of or resulting from the use, ownership or operation by the Servicer or any Affiliate thereof or any sub - contractor hired by the Initial Servicer or such Affiliate of a Financed Vehicle . (b) The Issuer, the Backup Servicer (including in its capacity as Successor Servicer), the Owner Trustee (including in its individual capacity), the Paying Agent (including in its individual capacity) and the Indenture Trustee (including in its individual capacity) shall be indemnified, defended and held harmless from and against any taxes that may at any time be asserted against any such Person with respect to the transactions contemplated herein or in the other Transaction Documents, if any, including, without limitation, any sales, gross receipts, general corporation, tangible personal property, privilege, or license taxes (but, in the case of the Issuer, not including any taxes asserted with respect to, and as of the date of, the conveyance of the Receivables to the Issuer or the issuance and original sales of the Notes, or asserted with respect to ownership of the Receivables, or federal or other Applicable Tax State income taxes arising out of the transactions contemplated by this Agreement and the other Transaction Documents) and costs and expenses in defending against the same. For the avoidance of doubt, the Initial Servicer will not indemnify for any costs, expenses, losses, claims, damages or liabilities due to the credit risk of the Obligors and for which reimbursement would constitute recourse for uncollectible Receivables. Amounts payable pursuant to this Section 6.2(b) shall be payable (i) to the Indenture Trustee, the Backup Servicer, the Paying Agent and the Owner Trustee pursuant to Section 4.4(a) hereof or Section 5.4(b) of the Indenture, as applicable (to the extent of Available Funds available therefor), and, to the extent not paid thereunder, by the Servicer, and (ii) to the Issuer by the Servicer. (c) The Initial Servicer will indemnify, defend and hold harmless the Issuer, the Backup Servicer (including in its capacity as Successor Servicer), the Paying Agent (including in its individual capacity), the Owner Trustee (including in its individual capacity), the Indenture Trustee (including in its individual capacity) and the Seller from and against any and all costs, expenses, losses, claims, damages, and liabilities to the extent that such cost, expense, loss, claim, damage, or liability arose out of, or was imposed upon any such Person through, the negligence, willful misfeasance, or bad faith (other than errors in judgment) of the Servicer in the performance of its duties under this Agreement or any other Transaction Document to which it is a party, or by reason of its failure to perform its obligations or of reckless disregard of its obligations and duties under this Agreement or any other Transaction Document to which it is a party; provided , however , that the Servicer will not indemnify for any costs, expenses, losses, claims, damages or liabilities arising from its breach of any covenant for which the purchase of the affected Receivables is specified as the sole remedy pursuant to Section 3.6 . (d) The Issuer or, if applicable, the Initial Servicer will compensate and indemnify the Backup Servicer (including in its capacity as Successor Servicer), the Calculation Agent (including in its individual capacity), the Paying Agent (including in its individual capacity), the Indenture Trustee (including in its individual capacity) and the Owner Trustee (including in its individual capacity) to the extent and subject to the conditions set forth in Section 6.7 of the Indenture and Section 8.2 of the Trust Agreement, as applicable, except, with respect to the Backup Servicer, to the extent that any cost, expense, loss, claim, damage or liability arises out of or is incurred in connection with the performance by the Backup Servicer of the duties of a successor Servicer hereunder.
753507386 23738694 25 Sale and Servicing Agreement (ACMAT 2023 - 2) (e) Indemnification under this Section 6.2 by America’s Car Mart (or any successor thereto pursuant to Section 7.1 ) as Servicer, with respect to the period such Person was the Servicer, will survive the termination or assignment of such Person as Servicer or a resignation by such Person as Servicer as well as the termination or assignment of this Agreement or the resignation or removal of the Owner Trustee, the Backup Servicer, the Paying Agent or the Indenture Trustee and will include reasonable fees and expenses of counsel and expenses of litigation. If either the Issuer or the Servicer has made any indemnity payments pursuant to this Section 6.2 and the Person to or on behalf of whom such payments are made thereafter collects any of such amounts from others, such Person will promptly repay such amounts to such party, without interest. SECTION 6.3 Merger or Consolidation of, or Assumption of the Obligations of, Servicer . Any entity (i) into which the Servicer may be merged or converted or with which it may be consolidated, to which it may sell or transfer its business and assets as a whole or substantially as a whole or any entity resulting from any merger, sale, transfer, conversion, conveyance or consolidation to which the Servicer shall be a party, or any entity succeeding to the business of the Servicer or (ii) of which more than 50% of the voting stock or voting power and 50% or more of the economic equity is owned directly or indirectly by America’s Car - Mart, Inc. and which executes an agreement of assumption to perform every obligation of the Servicer under this Agreement, shall be the successor to the Servicer under this Agreement, in each case, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding. Limitation on Liability of Servicer and Others .Neither the Servicer nor any of the directors or officers or employees or agents of the Servicer will be under any liability to the Issuer, the Indenture Trustee, the Owner Trustee, the Noteholders or the Certificateholders, except as provided under this Agreement or the other Transaction Documents, for any action taken or for refraining from the taking of any action pursuant to this Agreement or for errors in judgment; provided, however, that this provision will not protect the Servicer or any such Person against any liability that would otherwise be imposed by reason of willful misfeasance or bad faith in the performance of duties or by reason of its failure to perform its obligations or of reckless disregard of obligations and duties under this Agreement, or by reason of negligence in the performance of its duties under this Agreement (except for errors in judgment). The Servicer and any director, officer or employee or agent of the Servicer may rely in good faith on any Opinion of Counsel or on any Officer’s Certificate of the Seller or certificate of auditors believed to be genuine and to have been signed by the proper party in respect of any matters arising under this Agreement.Except as provided in this Agreement, the Servicer will not be under any obligation to appear in, prosecute, or defend any legal action that is not incidental to its duties to service the Receivables in accordance with this Agreement, and that in its opinion may involve it in any expense or liability; provided , however , that the Servicer may undertake any reasonable action that it may deem necessary or desirable in respect of this Agreement and the rights and duties of the parties to this Agreement and the interests of the Noteholders and the Certificateholders under this Agreement. In such event, the legal expenses and costs of such action and any liability resulting therefrom will be expenses, costs and liabilities of the Servicer. Notwithstanding the foregoing, if the Initial Servicer has been replaced as Servicer hereunder, any expenses or fees payable by the Servicer pursuant to this clause (b) shall be reimbursable by the Issuer in accordance with Section 4.4(a) of this Agreement or Section 5.4(b) of the Indenture, as applicable.
753507386 23738694 27 Sale and Servicing Agreement (ACMAT 2023 - 2) Servicer with respect to servicing the Receivables, the Indenture Trustee shall notify the Backup Servicer of such event and the Backup Servicer shall appoint a Successor Servicer pursuant to the Backup Serving Agreement. The Backup Servicer may appoint a Successor Servicer in accordance with the Backup Servicing Agreement or delegate any or all of its duties to any subcontractor or subservicer, in each case, without the consent of the Noteholders or any other party. Subject to Section 7.1(d) of this Agreement, upon the Servicer’s receipt of notice of termination, such Servicer will continue to perform its functions as Servicer under this Agreement only until the date specified in such termination notice or, if no such date is specified in such termination notice, until receipt of such notice. (b) Noteholders holding not less than a majority of the Note Balance of the Controlling Class (or, if no Notes are Outstanding, the Majority Certificateholders) may waive any Servicer Replacement Event. Upon any such waiver, such Servicer Replacement Event shall cease to exist and be deemed not to have occurred, and any Servicer Replacement Event arising therefrom shall be deemed not to have occurred for every purpose of this Agreement, but no such waiver shall extend to any prior, subsequent or other Servicer Replacement Event or impair any right consequent thereto. (c) If replaced, the Servicer agrees that it will comply with its obligations under the Backup Servicing Agreement with respect to the transition of servicing. (d) Upon the effectiveness of the assumption by the Person appointed by the Backup Servicer of its duties pursuant to this Section 7.1 and in accordance with the Backup Servicing Agreement, such Person shall be the successor in all respects to the Servicer in its capacity as Servicer under this Agreement with respect to the Receivables, and shall be subject to all the responsibilities, duties and liabilities relating thereto and subject to the limitations set forth in the Backup Servicing Agreement and this Agreement, except with respect to the obligations of the predecessor Servicer that survive its termination as Servicer, including indemnification obligations as set forth in Section 6.2(e) . In such event, the Indenture Trustee and the Owner Trustee are hereby authorized and empowered to execute and deliver, on behalf of the predecessor Servicer, as attorney - in - fact or otherwise, any and all documents and other instruments, and to do or accomplish all other acts or things necessary or appropriate to effect the purposes of such termination and replacement of the Servicer, whether to complete the transfer and endorsement of the Receivables and related documents, or otherwise. No Servicer shall resign or be relieved of its duties under this Agreement, as Servicer of the Receivables, until a newly appointed Servicer for the Receivables shall have assumed the responsibilities and obligations of the resigning or terminated Servicer under this Agreement. The Indenture Trustee, subject to the prior consent of the Noteholders holding not less than a majority of the Note Balance of the Outstanding Notes, voting together as a single Class, by Act of such Holders delivered to the Issuer and Indenture Trustee, shall have the right to agree to compensation of a successor servicer in excess of that permitted under the Transaction Documents. Notwithstanding anything else herein to the contrary, in no event shall the Indenture Trustee be liable for any Servicing Fee or for any differential in the amount of the Servicing Fee paid hereunder and the amount necessary to induce the Backup Servicer or any other successor Servicer to act as successor Servicer under this Agreement and the transactions set forth or provided for herein.
753507386 23738694 29 Sale and Servicing Agreement (ACMAT 2023 - 2) such engagement and dissemination of any such report of any accountants appointed by it (except to the extent that any such claims, liabilities or expenses are caused by such Successor Servicer’s gross negligence or willful misconduct) pursuant to the provisions of any Transaction Document, and the dissemination of such report shall, if applicable, be subject to the consent of such accountants, and (iii) such Successor Servicer shall have no obligation to provide investment direction pursuant to any Transaction Document requiring investment direction from the Xxxxxxxx.Xx Successor Servicer will be responsible for delays attributable to any predecessor Servicer’s failure to deliver information, defects in the information supplied by such predecessor Servicer or other circumstances beyond the reasonable control of such Successor Servicer. In addition, a Successor Servicer shall have no responsibility and shall not be in default hereunder or incur any liability for any act or omission, failure, error, malfunction or any delay in carrying out any of its duties under this Agreement for: (A) any such failure or delay which results from such Successor Servicer acting in accordance with information prepared or supplied by a Person other than the Successor Servicer or the failure of any such other Person (including without limitation the parties hereto) or any other Transaction Document to prepare or provide such information or other circumstances beyond the reasonable control of such Successor Servicer; (B) any act or failure to act by any third party, including without limitation the parties hereto or any other Transaction Document; (C) any inaccuracy or omission in a notice or communication received by such Successor Servicer from any third parties; (D) the invalidity or unenforceability of any Receivable and the Receivable Files under applicable law; (E) the breach or inaccuracy of any representation or warranty made by America’s Car - Mart or any predecessor Servicer with respect to the Receivables and the Receivable Files; or (F) the acts or omissions of any predecessor Servicer.The Servicer shall perform all of its duties as Servicer as specifically enumerated herein and shall make deposits of Collections into the Collection Account pursuant to Section 8.2(a) of the Indenture. Additionally, the initial Servicer (i) shall provide written instruction to the Indenture Trustee regarding financing statements and file (or cause to be filed) financing statements pursuant to Sections 3.5 and 3.7 of the Indenture, (ii) shall exercise the powers necessary to cause the Issuer to engage in the activities listed in Section 2.3 of the Amended and Restated Trust Agreement, (iii) may, but shall not be obligated to, give investment directions to the Indenture Trustee pursuant to Section 8.3 of the Indenture, (iv) shall perform the duties of the Servicer as enumerated in the Custody Agreement and (v) shall perform the duties of the Servicer as enumerated in the Electronic Collateral Control Agreement; provided, however, that no Successor Servicer shall have any duty or obligation with respect the performance of the duties and obligations listed in this sentence. Reliance on Work Product . Notwithstanding anything contained in the Agreement to the contrary, any Successor Servicer is authorized to accept and rely on all of the accounting, records (including computer records) and work of the prior Servicer (collectively, the “Predecessor Servicer Work Product”) without any audit or other examination thereof, and such Successor Servicer shall have no duty, responsibility, obligation or liability for the acts and omissions of the prior Servicer. If any error, inaccuracy, omission or incorrect or non - standard practice or procedure (collectively, “Errors”) exist in any Predecessor Servicer Work Product and such Errors make it materially more difficult to service or should cause or materially contribute to the Successor Servicer making or continuing any Errors (collectively, “Continued Errors”), the Successor Servicer shall have no duty, responsibility, obligation or liability for such Continued Errors; provided, however, that the Successor Servicer agrees to use its best efforts to prevent further Continued Errors. In the event that the Successor Servicer becomes aware of Errors or Continued Errors, it shall, with the prior
753507386 23738694 30 Sale and Servicing Agreement (ACMAT 2023 - 2) consent of the Noteholders representing 66 2/3% of the Outstanding Notes, use its best efforts to reconstruct and reconcile such data as is commercially reasonable to correct such Errors and Continued Errors and to prevent future Continued Errors. The Successor Servicer shall be entitled to recover its costs thereby expended in accordance with Section 4.4 hereof. Initial Servicer’s Agent . The initial Servicer shall appoint any Successor Servicer as the initial Servicer’s agent to execute, file, prepare, or record documents and otherwise perform on the initial Servicer’s behalf and in the initial Servicer’s name all actions reasonably necessary for the Successor Servicer to perform its duties defined herein. The initial Servicer shall appoint the Successor Servicer as the initial Servicer’s attorney - in - fact to act in the name of the initial Servicer to perform the duties of Servicer. Upon such Successor Servicer’s request, the initial Servicer shall execute and deliver to the Successor Servicer a revocable and limited power of attorney to further authorize the Successor Servicer to perform its duties. CLEAN - UP CALL SECTION 8.1 Clean - Up Call by Servicer . The Servicer shall have the right at its option (the “ Clean - Up Call ”) to purchase (and/or to designate one or more other persons to purchase) the Receivables, the Receivable Files and the Related Security (other than the Reserve Account) from the Issuer on any Payment Date if both of the following conditions are satisfied: (i) as of the last day of the related Collection Period, the Note Balance has declined to 10% or less of the Note Balance as of the Closing Date, and (ii) the sum of the Optional Purchase Price and the Available Funds for such Payment Date would be sufficient to pay the sum of (A) the Servicing Fee for such Payment Date and all unpaid Servicing Fees with respect to prior periods, (B) all fees, expenses and indemnities owed to the Indenture Trustee, the Backup Servicer, the Calculation Agent, the Certificate Registrar and the Owner Trustee and not previously paid (without giving effect to any caps), (C) interest then due on the Outstanding Notes and (D) the aggregate unpaid Note Balance of all of the Outstanding Notes. To exercise the Clean - Up Call, the Servicer (or its designee) shall deposit the Optional Purchase Price into the Collection Account on the Redemption Date. To avoid insufficient funds being available to make all payments as set forth in Section 4.4(a) in full, the Indenture Trustee shall, upon written directions from the Servicer (or its designee), withdraw any remaining amount on deposit in the Reserve Account and deposit such amounts into the Collection Account no later than 12:00 noon, New York City time, on the Business Day prior to the date of the Clean - Up Call. The Servicer shall furnish written notice of its election to exercise the Optional Purchase to the Indenture Trustee and the Owner Trustee not later than ten days prior to the date of the Optional Purchase. If the Servicer (or its designee) exercises the Optional Purchase, all Outstanding Notes shall be due and payable under the Indenture and the Notes shall be redeemed and in each case in whole but not in part on the related Payment Date for the Redemption Price. Following any such Optional Purchase, any funds remaining in the Reserve Account will be distributed to or at the direction of the Servicer.
753507386 23738694 39 Sale and Servicing Agreement (ACMAT 2023 - 2) written request of either Car - Mart Party, at any time such Car - Mart Party reasonably feels necessary, provide notification to the Car - Mart Parties with respect to any actions taken by the Indenture Trustee as soon as practicable and in any event within five Business Days of receipt of such request. [SIGNATURES FOLLOW]
ACM AUTO TRUST 2023 - 2 , as Issuer By: BNY Mellon Trust of Delaware, not in its individual capacity but solely as Owner Trustee By: Name: Title: Xxxx Plows Agent 753507386 23738694 S - 2 Sale and Servicing Agreement (ACMAT 2023 - 2)
CAR MART, INC., as Servicer 753507386 23738694 S - 3 Sale and Servicing Agreement (ACMAT 2023 - 2) xxxxxx X. Xxxxxxxx President
WILMINGTON TRUST, NATIONAL ASSOCIATION , not in its individual capacity but solely as Indenture Trustee, Backup Servicer, Paying Agent and Calculation Agent By: Name: Xxxxx Xxxxx Title: Vice President 753507386 23738694 S - 4 Sale and Servicing Agreement (ACMAT 2023 - 2)
Sale and Servicing Agreement 753507386 23738694 I - 1 Schedule I to SCHEDULE I NOTICE ADDRESSES If to the Issuer : ACM Auto Trust 2023 - 2 c/o BNY Mellon Trust of Delaware 000 Xxxxxxxx Xxxxxxx, 0xx Xxxxx Xxxxxxxxxx, Xxxxxxxx 00000 Attention: Corporate Trust Administration with copies to the Administrator and the Indenture Trustee If to the Sponsor, the Servicer or the Administrator : America’s Car Mart, Inc. 0000 X 0xx Xx, Xxxxx 000 Xxxxxx, Xxxxxxxx 00000 Telephone: (479) 464 - 9444 Attention: Xxxxx Xxxxxxx If to the Seller or the Depositor : ACM Funding, LLC 0000 X 0xx Xx, Xxxxx 000 Xxxxxx, Xxxxxxxx 00000 Telephone: (479) 464 - 9444 Attention: Xxxxx Xxxxxxx If to Colonial : Colonial Auto Finance, Inc. 0000 X 0xx Xx, Xxxxx 000 Xxxxxx, Xxxxxxxx 00000 Telephone: (479) 464 - 9444 Attention: Xxxxx Xxxxxxx If to the Indenture Trustee, Backup Servicer, Paying Agent, Calculation Agent or Certificate Registrar : Wilmington Trust, National Association Xxxxxx Square North 0000 Xxxxx Xxxxxx Xxxxxx Xxxxxxxxxx, Xxxxxxxx 00000 - 0000 Attention: Corporate Trust Administration – ACMAT 2023 - 2
Sale and Servicing Agreement 753507386 23738694 I - 2 Schedule I to If to the Owner Trustee : BNY Mellon Trust of Delaware 000 Xxxxxxxx Xxxxxxx, 0xx Xxxxx Xxxxxxxxxx, Xxxxxxxx 00000 Attention: Corporate Trust Administration If to S&P : S&P Global Ratings 00 Xxxxx Xxxxxx Xxx Xxxx, Xxx Xxxx 00000 Attention: Asset Backed Surveillance Department
753507386 23738694 A - 1 Exhibit A to Sale and Servicing Agreement EXHIBIT A FORM OF ASSIGNMENT PURSUANT TO SALE AND SERVICING AGREEMENT [ ], 2023 For value received, in accordance with the Sale and Servicing Agreement (the “ Agreement ”), dated as of July 6 , 2023 , by and between ACM Auto Trust 2023 - 2 , a Delaware statutory trust (the “ Issuer ”), ACM Funding, LLC, a Delaware limited liability company (the “ Seller ”), America’s Car Mart, Inc . , an Arkansas corporation (“ America’s Car Mart ”) and Wilmington Trust, National Association, a national banking association, as indenture trustee, as backup servicer, as paying agent and as calculation agent, on the terms and subject to the conditions set forth in the Agreement, the Seller does hereby irrevocably sell, transfer, assign, contribute and otherwise convey to the Issuer on the Closing Date, without recourse (subject to the obligations in the Agreement) all right, title and interest of the Seller, whether now owned or hereafter acquired, in, to and under the Receivables set forth on the schedule of Receivables delivered by the Seller to the Issuer on the date hereof, the Collections after the Cut - Off Date, the Receivable Files and the Related Security relating thereto, together with all of the Seller’s rights under the Purchase Agreement and all proceeds of the foregoing, which sale shall be effective as of the Cut - Off Date . The foregoing sale does not constitute and is not intended to result in an assumption by the Issuer of any obligation of the Seller to the Obligors, the Originators, insurers or any other Person in connection with the Receivables or the other assets and properties conveyed hereunder or any agreement, document or instrument related thereto . This assignment is made pursuant to and upon the representations, warranties and agreements on the part of the undersigned contained in the Agreement and is governed by the Agreement . Capitalized terms used herein and not otherwise defined shall have the meaning assigned to them in the Agreement . [Remainder of page intentionally left blank.]
753507386 23738694 A - 2 Exhibit A to Sale and Servicing Agreement IN WITNESS HEREOF, the undersigned has caused this assignment to be duly executed as of the date first above written. ACM FUNDING, LLC By: Name: Title:
753507386 23738694 B - 1 Exhibit B to Sale and Servicing Agreement EXHIBIT B PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS In addition to the representations, warranties and covenants contained in this Agreement, the Seller hereby represents, warrants and covenants to the Issuer and the Indenture Trustee as follows on the Closing Date: General 1. This Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables and the other Transferred Assets in favor of the Issuer, which security interest is prior to all other Liens, and is enforceable as such as against creditors of and purchasers from the Seller. 2. The Receivables constitute “tangible chattel paper,” “accounts,” “instruments” or “general intangibles,” within the meaning of the UCC. 3. Each Receivable is secured by a first priority validly perfected security interest in the related Financed Vehicle in favor of the Originator (or its assignee), as secured party, or all necessary actions with respect to such Receivable have been taken or will be taken to perfect a first priority security interest in the related Financed Vehicle in favor of the Originator (or its assignee), as secured party. Creation 4. Immediately prior to the sale, transfer, assignment and conveyance of a Receivable by the Seller to the Issuer, the Seller owned and had good and marketable title to such Receivable free and clear of any Lien created by Colonial (except any Lien which will be released prior to assignment of such Receivable under this Agreement), and immediately after the sale, transfer, assignment and conveyance of such Receivable to the Issuer, the Issuer will have good and marketable title to such Receivable free and clear of any Lien created by Colonial (other than Permitted Liens). 5. The Seller has received all consents and approvals to the sale of the Receivables hereunder to the Issuer required by the terms of the Receivables that constitute instruments. Perfection 6. The Seller has caused or will have caused, within ten days after the effective date of this Agreement, the filing of all appropriate financing statements in the proper filing office in the appropriate jurisdictions under applicable law in order to perfect the sale of the Receivables from the Seller to the Issuer, and the security interest in the Receivables granted to the Issuer hereunder; and the Servicer, in its capacity as custodian, has in its possession the original copies of such instruments or tangible chattel paper that constitute or evidence the Receivables, and all financing statements referred to in this paragraph contain a statement that: “A purchase of or
753507386 23738694 B - 2 Exhibit B to Sale and Servicing Agreement security interest in any collateral described in this financing statement will violate the rights of the Secured Party/Purchaser”. 7. With respect to Receivables that constitute instruments or tangible chattel paper, either: (i) All original executed copies of each such instrument or tangible chattel paper have been delivered to the Indenture Trustee, as pledgee of the Issuer; or (ii) Such instruments or tangible chattel paper are in the possession of the Servicer and the Indenture Trustee has received a written acknowledgment from the Servicer that the Servicer, in its capacity as custodian, is holding such instruments or tangible chattel paper solely on behalf and for the benefit of the Indenture Trustee, as pledgee of the Issuer; or (iii) The Servicer received possession of such instruments or tangible chattel paper after the Indenture Trustee received a written acknowledgment from the Servicer that the Servicer is acting solely as agent of the Indenture Trustee, not in its individual capacity but solely as Indenture Trustee, as pledgee of the Issuer. Priority 8. Neither the Seller nor Colonial has authorized the filing of, or is aware of any financing statements against either the Seller or Colonial that include a description of collateral covering the Receivables other than any financing statement (i) relating to the conveyance of the Receivables by Colonial to the Seller under the Purchase Agreement, (ii) relating to the conveyance of the Receivables by the Seller to the Issuer under the Sale and Servicing Agreement, (iii) relating to the security interest granted by the Issuer to the Indenture Trustee under the Indenture or (iv) that has been terminated. 9. Neither the Seller nor Colonial is aware of any material judgment, ERISA or tax lien filings against either the Seller or Colonial. 10. None of the instruments or tangible chattel paper that constitute or evidence the Receivables has any marks or notations indicating that they have been pledged, assigned or otherwise conveyed to any Person other than the Seller, the Issuer or the Indenture Trustee. Survival of Perfection Representations 11. Notwithstanding any other provision of this Agreement or any other Transaction Document, the perfection representations, warranties and covenants contained in this Exhibit B shall be continuing, and remain in full force and effect until such time as all obligations under the Transaction Documents and the Notes have been finally and fully paid and performed.
753507386 23738694 B - 3 Exhibit B to Sale and Servicing Agreement No Waiver 12. The Seller and the Servicer shall provide the Rating Agency with prompt written notice of any material breach of the perfection representations, warranties and covenants contained in this Exhibit B , and shall not, without satisfying the Rating Agency Condition, waive a breach of any of such perfection representations, warranties or covenants.
753507386 23738694 C - 1 Exhibit C to Sale and Servicing Agreement EXHIBIT C Monthly Data File Interest Collections, Recoveries, Fees Repurchase Prices Pool Balance Defaulted Receivables Repurchased Receivables Cram down losses and other principal adjustments Pool Factor Principal Collections Delinquencies (Current, 31 - 60 Days Delinquent, 61 - 90 Days Delinquent, over 90 Days Delinquent) Losses (Current Period Gross Charge - Off, Current Period Recoveries, Current Period Net Losses, Cumulative Gross Charge - Off, Cumulative Recoveries, Cumulative Net Losses, Cumulative Gross Charge Offs Percentage, Cumulative Net Loss Percentage) Current Period Deferrals and Extensions Current Period Deferrals and Extensions Percentage
EXECUTION VERSION APPENDIX A DEFINITIONS The following terms have the meanings set forth, or referred to, below: “ Accrued Class A Note Interest ” means, with respect to any Payment Date, the sum of the Class A Noteholders’ Monthly Accrued Interest for such Payment Date and the Class A Noteholders’ Interest Carryover Shortfall for such Payment Date. “ Accrued Class B Note Interest ” means, with respect to any Payment Date, the sum of the Class B Noteholders’ Monthly Accrued Interest for such Payment Date and the Class B Noteholders’ Interest Carryover Shortfall for such Payment Date. “ Act ” has the meaning set forth in Section 11.3(a) of the Indenture. “ Administration Agreement ” means the Administration Agreement, dated as of the Closing Date, between the Administrator, the Issuer and the Indenture Trustee, as the same may be amended, restated, modified or supplemented from time to time. “ Administrator ” means America’s Car Mart or any successor Administrator under the Administration Agreement. “ Affiliate ” means, for any specified Person, any other Person which, directly or indirectly, controls, is controlled by or is under common control with such specified Person, and “affiliated” has a meaning correlative to the foregoing. For purposes of this definition, “control” means the power, directly or indirectly, to cause the direction of the management and policies of a Person. “ America’s Car Mart ” means Americas Car Mart, Inc., an Arkansas corporation, and its successor - in - interest. “ Applicable Tax State ” means, as of any date, each of the following: (a) the State in which the Issuer is located and (b) the States of Texas and Arkansas. “ Authenticating Agent ” means any Person authorized by the Indenture Trustee to act on behalf of the Indenture Trustee to authenticate and deliver the Notes. “ Authorized Newspaper ” means a newspaper of general circulation in the City of New York, printed in the English language and customarily published on each Business Day, whether or not published on Saturdays, Sundays and holidays. “ Authorized Officer ” means (a) with respect to the Issuer, (i) any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer (including any agent of the Owner Trustee acting under a power of attorney) and who is identified on the list of Authorized Officers delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter), or (ii) so long as the Administration Agreement is in effect, any officer of the Administrator who is authorized to act for the Administrator in matters relating to the Issuer pursuant to the 753507398 23738694 Definitions (ACMAT 2023 - 2)
753507398 23738694 A - 2 Definitions (ACMAT 2023 - 2) Administration Agreement and who is identified on the list of Authorized Officers delivered by the Administrator to the Owner Trustee and the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter), and (b) with respect to the Owner Trustee, the Indenture Trustee, the Administrator, the Servicer and the Backup Servicer, any officer of the Owner Trustee, the Indenture Trustee, the Administrator, the Servicer or the Backup Servicer, as applicable, who is authorized to act for the Owner Trustee, the Indenture Trustee, the Administrator, the Servicer or the Backup Servicer, as applicable, in matters relating to the Transaction Documents and who is identified on the list of Authorized Officers delivered by each of the Owner Trustee, the Indenture Trustee, the Administrator, the Servicer and the Backup Servicer, as applicable, to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter). “ Available Funds ” means, for any Payment Date and the related Collection Period, an amount equal to the sum of the following amounts: (i) all Collections received by the Servicer during such Collection Period, (ii) the sum of the Repurchase Prices deposited into the Collection Account with respect to each Receivable that will be a Repurchased Receivable on such Payment Date, (iii) the Reserve Account Excess Amount for such Payment Date and (iv) the Optional Purchase Price deposited into the Collection Account in connection with the exercise of the Clean - Up Call. “ Available Funds Shortfall Amount ” means, as of any Payment Date, the amount, if any, by which the sum of the amounts required to be paid pursuant to clauses first through sixth of Section 4.4(a) of the Sale and Servicing Agreement exceeds the Available Funds for such Payment Date. “ Backup Servicer ” means Wilmington Trust, National Association, a national banking association, in its capacity as the backup servicer under the Backup Servicing Agreement. “ Backup Servicing Agreement ” means the Backup Servicing Agreement, dated as of the Closing Date, among the Servicer, the Issuer, the Indenture Trustee and the Backup Servicer. “ Backup Servicing Fee ” means, for any Payment Date, an amount equal to $4,250; provided , however , that if the Backup Servicer becomes the Successor Servicer, such fee shall no longer be paid. “ Bankruptcy Code ” means the United States Bankruptcy Code, 11 U.S.C. 101 et seq., as amended. “ Bankruptcy Event ” means, with respect to any Person, (i) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of such Person in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of such Person, or ordering the winding - up or liquidation of such Person’s affairs, and such decree or order shall remain unstayed and in effect for a period of 90 consecutive days or (ii) the commencement by such Person of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by such Person to the entry of an order for relief in an involuntary case under any
753507398 23738694 A - 3 Definitions (ACMAT 2023 - 2) such law, or the consent by such Person to the appointment or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official of such Person, or the making by such Person of any general assignment for the benefit of creditors, or the failure by such Person generally to pay its debts as such debts become due, or the taking of action by such Person in furtherance of any of the foregoing. “ Bankruptcy Remote Party ” means each of the Seller, the Issuer, any other trust created by the Seller or any limited liability company or corporation wholly - owned by the Seller. “ Benefit Plan ” means (i) any “employee benefit plan” as defined in Section 3(3) of ERISA, that is subject to Title I of ERISA, (ii) a “plan” as described by Section 4975 of the Code, that is subject to Section 4975 of the Code or (iii) any entity or account deemed to hold the “plan assets” of any of the foregoing. “ Book - Entry Notes ” means a beneficial interest in the Notes, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in Section 2 . 10 of the Indenture . “ Business Day ” means any day other than a Saturday, a Sunday or a day on which banking institutions in the States of Delaware, Arkansas, Texas or New York, or in the state in which the Corporate Trust Office of the Indenture Trustee or the Owner Trustee is located, are authorized or obligated by law, executive order or government decree to be closed; provided that, when used in the context of a Payment Date, Business Day means any day other than (i) a Saturday or Sunday or (ii) a day on which the Federal Reserve Bank of New York is closed. “ Calculation Agent ” means Wilmington Trust, National Association, in its capacity as calculation agent under the Sale and Servicing Agreement and its successors and permitted assigns in such capacity . “ Certificate ” means a certificate substantially in the form of Exhibit A to the Trust Agreement evidencing a beneficial ownership interest in the Issuer. For the avoidance of doubt, the references in the Transaction Documents to a “Certificate” or a “Certificateholder,” unless the context otherwise requires, shall be deemed to be references to “Certificates” or “Certificateholders” if more than one Certificate has been issued. “ Certificate of Title ” means, with respect to any Financed Vehicle, the certificate of title or other documentary evidence of ownership of such Financed Vehicle as issued by the department, agency or official of the jurisdiction (whether in paper or electronic form) in which such Financed Vehicle is titled and which is responsible for accepting applications for, and maintaining records regarding, certificates of title and liens thereon. “ Certificate Register ” has the meaning specified in Section 3.4 of the Trust Agreement. “ Certificate Registrar ” has the meaning specified in Section 3.4 of the Trust Agreement. “ Certificateholder ” means, as of any date, the Person in whose name a Certificate is registered on the Certificate Register on such date.
753507398 23738694 A - 4 Definitions (ACMAT 2023 - 2) “ Class ” means a group of Notes whose form is identical except for variation in denomination, principal amount or owner, and references to “each Class” thus mean each of the Class A Notes and the Class B Notes. “ Class A Final Scheduled Payment Date ” means the Payment Date occurring in June 2030. “ Class A Interest Rate ” means 7.97% per annum (computed on the basis of a 360 - day year consisting of twelve 30 - day months). “ Class A Note Balance ” means, at any time, the Initial Class A Note Balance reduced by all payments of principal made prior to such time on the Class A Notes. “ Class A Noteholder ” means the Person in whose name a Class A Note is registered on the Note Register. “ Class A Noteholders’ Interest Carryover Shortfall ” means, with respect to any Payment Date, the excess, if any, of (A) the sum of (i) the Class A Noteholders’ Monthly Accrued Interest for the preceding Payment Date and (ii) any Class A Noteholders’ Interest Carryover Shortfall on such preceding Payment Date, over (B) the amount in respect of interest that was actually paid to Noteholders of Class A Notes on such preceding Payment Date, plus interest on the amount of interest due but not paid to Noteholders of Class A Notes on such preceding Payment Date, to the extent permitted by law, at the Class A Interest Rate for the related Interest Period . “ Class A Noteholders’ Monthly Accrued Interest ” means, with respect to any Payment Date, the aggregate interest accrued for the related Interest Period on the Class A Notes at the Class A Interest Rate on the Class A Note Balance on the Closing Date, with respect to the first Payment Date, and on the immediately preceding Payment Date, after giving effect to all payments of principal to the Class A Noteholders on or prior to such preceding Payment Date, with respect to each subsequent Payment Date . “ Class A Notes ” means the Class of Auto Loan Asset Backed Notes designated as Class A Notes issued in accordance with the Indenture. “ Class B Final Scheduled Payment Date ” means the Payment Date occurring in June 2030. “ Class B Interest Rate ” means 9.85% per annum (computed on the basis of a 360 - day year consisting of twelve 30 - day months). “ Class B Note Balance ” means, at any time, the Initial Class B Note Balance reduced by all payments of principal made prior to such time on the Class B Notes. “ Class B Noteholder ” means the Person in whose name a Class B Note is registered on the Note Register. “ Class B Noteholders’ Interest Carryover Shortfall ” means, with respect to any Payment Date, the excess, if any, of (A) the sum of (i) the Class B Noteholders’ Monthly Accrued Interest
753507398 23738694 A - 5 Definitions (ACMAT 2023 - 2) for the preceding Payment Date and (ii) any Class B Noteholders’ Interest Carryover Shortfall on such preceding Payment Date, over (B) the amount in respect of interest that was actually paid to Noteholders of Class B Notes on such preceding Payment Date, plus interest on the amount of interest due but not paid to Noteholders of Class B Notes on such preceding Payment Date, to the extent permitted by law, at the Class B Interest Rate for the related Interest Period . “ Class B Noteholders’ Monthly Accrued Interest ” means, with respect to any Payment Date, the aggregate interest accrued for the related Interest Period on the Class B Notes at the Class B Interest Rate on the Class B Note Balance on the Closing Date, with respect to the first Payment Date, and on the immediately preceding Payment Date, after giving effect to all payments of principal to the Class B Noteholders on or prior to such preceding Payment Date, with respect to each subsequent Payment Date . “ Class B Notes ” means the Class of Auto Loan Asset Backed Notes designated as Class B Notes issued in accordance with the Indenture. “ Clean - Up Call ” has the meaning set forth in Section 8.1 of the Sale and Servicing Agreement. “ Clearing Agency ” means an organization registered as a “clearing agency” pursuant to Section 17A of the Exchange Act and shall initially be DTC. “ Clearing Agency Participant ” means a broker, dealer, bank or other financial institution, or other Person for which from time to time a Clearing Agency effects book - entry transfers and pledges of securities deposited with the Clearing Agency. “ Closing Date ” means July 6, 2023. “ Code ” means the Internal Revenue Code of 1986, as amended, modified or supplemented from time to time, and any successor law thereto, and the regulations promulgated and the rulings issued thereunder. “ Collateral ” has the meaning set forth in the Granting Clause of the Indenture. “ Collection Account ” means the trust account established and maintained pursuant to Section 4 . 1 of the Sale and Servicing Agreement . “ Collection Period ” means the period commencing on the first day of each calendar month and ending on the last day of such calendar month (or, in the case of the initial Collection Period, the period commencing on the close of business on the Cut - Off Date and ending on June 30, 2023). As used herein, the “related” Collection Period with respect to any date of determination or a Payment Date shall be deemed to be the Collection Period which immediately precedes such date of determination or Payment Date. “ Collections ” means, to the extent received by the Servicer after the Cut - Off Date, the sum of (A) with respect to any Receivable, (i) any monthly payment by or on behalf of the Obligor thereunder, (ii) any full or partial prepayment of such Receivable, and (iii) any other amounts received by or paid by the Servicer which, in accordance with the Customary Servicing
753507398 23738694 A - 6 Definitions (ACMAT 2023 - 2) Practices, would customarily be applied to the payment of accrued interest or to reduce the Principal Balance of the Receivable, including rebates of premiums with respect to the cancellation or termination of any Insurance Policy, extended warranty or service contract that was financed by such Receivable and (B) Net Liquidation Proceeds ; provided , however , that the term “Collections” in no event will include ( 1 ) for any Payment Date, any amounts in respect of any Receivable the Repurchase Price of which has been included in the Available Funds on a prior Payment Date, ( 2 ) any Supplemental Servicing Fees or ( 3 ) any Unrelated Amounts . “ Colonial ” means Colonial Auto Finance, Inc., an Arkansas corporation, or its successor - in - interest. “ Commission ” means the U.S. Securities and Exchange Commission. “ Contract ” means, with respect to any Receivable, the motor vehicle retail installment sale contract and/or note and security agreement, any amendments thereto and any related documentary draft, if applicable, evidencing such Receivable. “ Contract Rate ” means, with respect to a Receivable, the rate per annum at which interest accrues under the Contract evidencing such Receivable. Such rate may be less or more than the “Annual Percentage Rate” disclosed in the Receivable. “ Controlling Class ” means, with respect to any Notes Outstanding, the Class A Notes as long as any Class A Notes are Outstanding, and, thereafter, the Class B Notes as long as any Class B Notes are Outstanding. “ Controlling Party ” means an executive officer or senior manager or any other individual who regularly performs similar functions; including any individual who performs such function indirectly through a Person that beneficially owns or controls the Issuer or an agent of the Issuer, as applicable. “ Corporate Trust Office ” means: (a) as used with respect to the Indenture Trustee, the principal office of the Indenture Trustee at which at any particular time its corporate trust business shall be administered, which office at the date of the execution of the Indenture is located at Wilmington Trust, National Association, Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Administration – ACMAT 2023 - 2, or at such other address as the Indenture Trustee may designate from time to time by notice to the Noteholders, the Administrator, the Servicer, the Owner Trustee and the Issuer, or the principal corporate trust office of any successor Indenture Trustee (the address of which the successor Indenture Trustee will notify the Noteholders, the Administrator, the Servicer, the Owner Trustee and the Issuer); (b) as used with respect to the Owner Trustee, the corporate trust office of the Owner Trustee located at 000 Xxxxxxxx Xxxxxxx, 0xx Xxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Administration, or at such other address as the Owner Trustee may designate by notice to the Certificateholders and the Seller, or the principal corporate trust office of any successor Owner Trustee (the address of which the successor Owner Trustee will notify the Certificateholders and the Seller); and
753507398 23738694 A - 7 Definitions (ACMAT 2023 - 2) (c) as used with respect to the Certificate Registrar, the principal office of the Certificate Registrar at which at any particular time its corporate trust business shall be administered, which office at date of the execution of the Trust Agreement is located at Wilmington Trust, National Association, Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Administration – ACMAT 2023 - 2, or at such other address as the Certificate Registrar may designate from time to time by notice to the Certificateholders, the Indenture Trustee, the Owner Trustee and the Issuer, or the principal corporate trust office of any successor Certificate Registrar (the address of which the successor Certificate Registrar will notify the Certificateholders, the Indenture Trustee, the Owner Trustee and the Issuer). “ Cram Down Loss ” means, with respect to any Receivable (other than a Defaulted Receivable) as to which any court in any bankruptcy, insolvency or other similar Proceeding issues an order reducing the principal amount to be paid on such Receivable or otherwise modifies any payment terms with respect thereto, an amount equal to the amount of the principal reduction ordered by such court. A “Cram Down Loss” will be deemed to have occurred on the date of issuance of such court’s order. “ Customary Servicing Practices ” means the customary servicing practices of the Servicer, the Backup Servicer (as Successor Servicer) or any other Successor Servicer or any subservicer with respect to all comparable motor vehicle receivables that the Servicer, the Successor Servicer or such subservicer, as applicable, services for itself and others, as such customary servicing practices may be changed from time to time, it being understood that the Servicer, the Successor Servicer and the subservicers may not have the same “ Customary Servicing Practices. ” “ Cut - Off Date ” means May 31, 2023. “ Debt - For - Tax Opinion ” means an Opinion of Counsel, of nationally recognized tax counsel, delivered to the Depositor and the Indenture Trustee stating that the Notes specified therein will be debt for United States federal income tax purposes . “ Default ” means any occurrence that is, or with notice or lapse of time or both would become, an Event of Default. “ Defaulted Receivable ” means, with respect to any Collection Period, a Receivable as to which (a) a related monthly payment became 120 days past due during such Collection Period and the Servicer has not repossessed the related Financed Vehicle, (b) the Servicer has either repossessed and liquidated the related Financed Vehicle or repossessed and held the related Financed Vehicle in its repossession inventory for 90 days, whichever occurs first, or (c) the Servicer has charged - off in full the related Principal Balance or has determined that such Principal Balance should be charged - off in full on the servicing records of the Servicer in accordance with its Customary Servicing Practices. “ Deficiency Balance ” means, with respect to any Receivable, any deficiency balance, charged - off amount, Principal Balance, accrued interest and/or fees and any Related Security;
753507398 23738694 A - 8 Definitions (ACMAT 2023 - 2) provided, that such amounts and Related Security relate to a Receivable which is a Defaulted Receivable. “ Definitive Note ” means a definitive fully registered Note issued pursuant to Section 2.12 of the Indenture. “ Delivery ” when used with respect to Trust Account Property means: (a) with respect to (I) bankers’ acceptances, commercial paper, and negotiable certificates of deposit and other obligations that constitute “instruments” as defined in Section 9 - 102(a)(47) of the UCC and are susceptible of physical delivery, transfer of actual possession thereof to the Indenture Trustee or its nominee or custodian by physical delivery to the Indenture Trustee or its nominee or custodian endorsed to the Indenture Trustee or its nominee or custodian or endorsed in blank, and (II) with respect to a “certificated security” (as defined in Section 8 - 102(a)(4) of the UCC) transfer of actual possession thereof (i) by physical delivery of such certificated security to the Indenture Trustee or its nominee or custodian endorsed to, or registered in the name of, the Indenture Trustee or its nominee or custodian or endorsed in blank, or to another person, other than a “securities intermediary” (as defined in Section 8 - 102(a)(14) of the UCC), who acquires possession of the certificated security on behalf of the Indenture Trustee or its nominee or custodian or, having previously acquired possession of the certificate, acknowledges that it holds for the Indenture Trustee or its nominee or custodian or (ii) if such certificated security is in registered form, by delivery thereof to a “securities intermediary”, endorsed to or registered in the name of the Indenture Trustee or its nominee or custodian, and the making by such “securities intermediary” of entries on its books and records identifying such certificated securities as belonging to the Indenture Trustee or its nominee or custodian and the sending by such “securities intermediary” of a confirmation of the purchase of such certificated security by the Indenture Trustee or its nominee or custodian (all of the foregoing, “ Physical Property ”), and, in any event, any such Physical Property in registered form shall be in the name of the Indenture Trustee or its nominee or custodian; and such additional or alternative procedures as may hereafter become appropriate to effect the complete transfer of ownership of any such Trust Account Property to the Indenture Trustee or its nominee or custodian, consistent with changes in applicable law or regulations or the interpretation thereof; (b) with respect to any securities issued by the U.S. Treasury, the Federal Home Loan Mortgage Corporation, the Federal National Mortgage Association or the other government agencies, instrumentalities and establishments of the United States identified in Appendix A to Federal Reserve Bank Operating Circular No. 7 as in effect from time to time that is a “book - entry security” (as such term is defined in Federal Reserve Bank Operating Circular No. 7) held in a securities account and eligible for transfer through the Fedwire® Securities Service operated by the Federal Reserve System pursuant to Federal book - entry regulations, the following procedures, all in accordance with applicable law, including applicable Federal regulations and Articles 8 and 9 of the UCC: book - entry registration of such Trust Account Property to an appropriate securities account maintained with a Federal Reserve Bank by a “participant” (as such term is defined in Federal Reserve Bank Operating Circular No. 7) that is a “depository institution” (as defined in Section 19(b)(1)(A) of the Federal Reserve Act) pursuant to applicable Federal regulations, and issuance by such depository institution of a deposit notice or other written confirmation of such book - entry registration to the Indenture Trustee or its nominee or
753507398 23738694 A - 9 Definitions (ACMAT 2023 - 2) custodian of the purchase by the Indenture Trustee or its nominee or custodian of such book - entry securities; the making by such depository institution of entries in its books and records identifying such book entry security held through the Federal Reserve System pursuant to Federal book - entry regulations or a security entitlement thereto as belonging to the Indenture Trustee or its nominee or custodian and indicating that such depository institution holds such Trust Account Property solely as agent for the Indenture Trustee or its nominee or custodian; and such additional or alternative procedures as may hereafter become appropriate to effect complete transfer of ownership of any such Trust Account Property to the Indenture Trustee or its nominee or custodian, consistent with changes in applicable law or regulations or the interpretation thereof; and (c) with respect to any item of Trust Account Property that is an “uncertificated security” (as defined in Section 8 - 102(a)(18) of the UCC) and that is not governed by clause (b) above, (i) registration on the books and records of the issuer thereof in the name of the Indenture Trustee or its nominee or custodian, or (ii) registration on the books and records of the issuer thereof in the name of another person, other than a securities intermediary, who acknowledges that it holds such uncertificated security for the benefit of the Indenture Trustee or its nominee or custodian. “ Depositor ” means ACM Funding, LLC in its capacity as Depositor under the Trust Agreement. “ Depository Agreement ” means the agreement, dated as of the Closing Date, executed by the Issuer in favor of DTC, as initial Clearing Agency, relating to the Notes, as the same may be amended or supplemented from time to time . “ Determination Date ” means the fifth Business Day preceding the related Payment Date, beginning July 13 , 2023 . “ Dollar ” and “ $ ” mean lawful currency of the United States. “ Domestic Corporation ” means an entity that is treated as a corporation for United States federal income tax purposes and is a U . S . Tax Person . “ DTC ” means The Depository Trust Company and its successors. “ Electronic Means ” means the following communications methods: e - mail, facsimile transmission, secure electronic transmission containing applicable authorization codes, passwords and/or authentication keys issued by the Owner Trustee, or another method or system specified by the Owner Trustee as available for use in connection with its services under the Trust Agreement. “ Eligible Account ” means a segregated trust account with the corporate trust department of a depository institution whose deposits are insured by the FDIC acting in its fiduciary capacity organized under the laws of the United States or any one of the states thereof or the District of Columbia (or any domestic branch of a foreign bank) having corporate trust powers and acting as trustee for funds deposited in such account so long as the issuer credit rating of such depository institution shall have a credit rating from S&P of at least “BBB” and from any other NRSRO (if
753507398 23738694 A - 10 Definitions (ACMAT 2023 - 2) rated by another NRSRO) in one of its generic rating categories which signifies investment grade. Any such trust account may be maintained with the Owner Trustee, the Indenture Trustee or any of their respective Affiliates if such accounts meet the requirements of the preceding sentence. “ Eligible Investments ” means any one or more of the following types of investments: (a) direct obligations of, and obligations fully guaranteed as to timely payment by, the United States; (b) demand deposits, time deposits or certificates of deposit of any depository institution (including any Affiliate of the Seller, the Servicer, the Indenture Trustee, the Backup Servicer or the Owner Trustee) or trust company incorporated under the laws of the United States or any state thereof or the District of Columbia (or any domestic branch of a foreign bank) and subject to supervision and examination by Federal or state banking or depository institution authorities (including depository receipts issued by any such institution or trust company as custodian with respect to any obligation referred to in clause (a) above or a portion of such obligation for the benefit of the holders of such depository receipts), provided that , at the time of the investment or contractual commitment to invest therein (which shall be deemed to be made again each time funds are reinvested following each Payment Date), the commercial paper or other short - term senior unsecured debt obligations (other than such obligations the rating of which is based on the credit of a Person other than such depository institution or trust company) of such depository institution or trust company shall have a credit rating from S&P of at least “A - 1”; (c) commercial paper (including commercial paper of any Affiliate of the Seller, the Servicer, the Indenture Trustee, the Backup Servicer or the Owner Trustee) having, at the time of the investment or contractual commitment to invest therein, a credit rating from S&P of at least “A - 1”; (d) investments in money market funds (including funds for which the Seller, the Servicer, the Indenture Trustee or the Owner Trustee or any of their respective Affiliates is investment manager or advisor) having a credit rating in the highest rating category from S&P and from any other NRSRO (if rated by another NRSRO) then rating such money market funds; (e) bankers’ acceptances issued by any depository institution or trust company referred to in clause (b) above; (f) repurchase obligations with respect to any security that is a direct obligation of, or fully guaranteed by, the United States or any agency or instrumentality thereof, the obligations of which are backed by the full faith and credit of the United States, in either case entered into with a depository institution or trust company (acting as principal) referred to in clause (b) above ; and (g) any other investment as to which the Rating Agency Condition shall have been satisfied.
753507398 23738694 A - 11 Definitions (ACMAT 2023 - 2) Each of the Eligible Investments may be purchased from the Indenture Trustee or through an Affiliate of the Indenture Trustee. Each Eligible Investment must mature or be liquidated on the Business Day immediately preceding the next Payment Date. “ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended. “ Event of Default ” has the meaning set forth in Section 5.1 of the Indenture. “ Exchange Act ” means the Securities Exchange Act of 1934, as amended. “ FATCA ” means Sections 1471 through 1474 of the Code, any regulations or official interpretations thereunder or official interpretations thereof, and any current or future agreements entered into pursuant to Section 1471(b)(1) of the Code, any published intergovernmental agreement entered into in connection with the implementation of such sections of the Code, and any applicable fiscal or regulatory legislation, rules or official practices adopted pursuant to such published intergovernmental agreement. “ FATCA Withholding ” means any withholding or deduction required pursuant to FATCA. “ Final Scheduled Payment Date ” means, with respect to (i) the Class A Notes, the Class A Final Scheduled Payment Date and (ii) the Class B Notes, the Class B Final Scheduled Payment Date. “ Financed Vehicle ” means an automobile, light - duty truck, SUV or van, together with all accessions thereto, securing an Obligor’s indebtedness under the applicable Receivable. “ First Allocation of Principal ” means, with respect to any Payment Date, an amount equal to the excess, if any, of (a) the Class A Note Balance as of such Payment Date (before giving effect to any principal payments made on the Class A Notes on such Payment Date) over (b) the Pool Balance as of the end of the related Collection Period; provided , however , that the First Allocation of Principal for any Payment Date on and after the Final Scheduled Payment Date for the Class A Notes shall not be less than the amount that is necessary to reduce the Note Balance of the Class A Notes to zero. “ GAAP ” means generally accepted accounting principles in the USA applied on a materially consistent basis. “ Governmental Authority ” means any (a) Federal, state, municipal, foreign or other governmental entity, board, bureau, agency or instrumentality, (b) administrative or regulatory authority (including any central bank or similar authority) or (c) court or judicial authority. “ Grant ” means mortgage, pledge, bargain, sell, warrant, alienate, remise, release, convey, assign, transfer, create, xxxxx x xxxx upon and a security interest in and right of set - off against, deposit, set over and confirm pursuant to the Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the Granting party thereunder, including the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral
753507398 23738694 A - 12 Definitions (ACMAT 2023 - 2) and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring Proceedings in the name of the Granting party or otherwise, and generally to do and receive anything that the Granting party is or may be entitled to do or receive thereunder or with respect thereto. Other forms of the verb “to Grant” shall have correlative meanings. “ Hague Securities Convention ” means the Hague Convention on the Law Applicable to Certain Rights in Respect of Securities held with an Intermediary (concluded July 5 , 2006 ) . “ Holder ” means, as the context may require, the Certificateholder or a Noteholder or both. “ Indenture ” means the Indenture, dated as of the Closing Date, between the Issuer and the Indenture Trustee, as the same may be amended, restated, modified or supplemented from time to time . “ Indenture Trustee ” means Wilmington Trust, National Association, a national banking association, not in its individual capacity but as indenture trustee under the Indenture or any successor trustee under the Indenture. “ Independent ” means, when used with respect to any specified Person, that such Person (i) is in fact independent of the Issuer, any other obligor upon the Notes, the Administrator and any Affiliate of any of the foregoing Persons, (ii) does not have any direct financial interest or any material indirect financial interest in the Issuer, any such other obligor upon the Notes, the Administrator or any Affiliate of any of the foregoing Persons and (iii) is not connected with the Issuer, any such other obligor upon the Notes, the Administrator or any Affiliate of any of the foregoing Persons as an officer, employee, promoter, underwriter, trustee, partner, director or Person performing similar functions . “ Initial Certificate Transfer Opinion ” means an opinion rendered by nationally recognized tax counsel (i) upon the initial transfer by the Depositor of a Certificate that results in the Issuer being treated as a partnership for United States federal income tax purposes and (ii) while any Note retained by the Issuer or a Person that is considered the same Person as the Issuer for United States federal income tax purposes is outstanding that (x) such Note will be debt for United States federal income tax purposes or (y) the transfer by the Depositor of such Certificate will not cause the Issuer to be treated as an association or publicly traded partnership taxable as a corporation. “ Initial Class A Note Balance ” means $271,640,000. “ Initial Class B Note Balance ” means $88,700,000. “ Initial Purchasers ” means BMO Capital Markets Corp. and SMBC Nikko Securities America, Inc. “ Initial Reserve Account Deposit Amount ” means an amount equal to $ 11 , 087 , 384 . 86 .
753507398 23738694 A - 13 Definitions (ACMAT 2023 - 2) “ Initial Servicer ” means America’s Car Mart, Inc., an Arkansas corporation, the initial servicer under the Sale and Servicing Agreement. “ Insurance Policy ” means (i) any theft and physical damage insurance policy maintained by or on behalf of the Obligor under a Receivable providing coverage against loss or damage to or theft of the related Financed Vehicle and (ii) any credit life or credit disability insurance maintained by an Obligor in connection with any Receivable. “ Interest Period ” means, with respect to any Payment Date, from and including the 20 th day of the calendar month preceding such Payment Date (or from and including the Closing Date in the case of the first Payment Date) to but excluding the 20 th day of the month in which such Payment Date occurs. “ Interest Rate ” means, (a) with respect to the Class A Notes, the Class A Interest Rate, or (b) with respect to the Class B Notes, the Class B Interest Rate. “ Investment Company Act ” means the Investment Company Act of 1940, as amended. “ Investor Report ” has the meaning set forth in Section 4.6 of the Sale and Servicing Agreement. “ Investor Reporting Date ” means the second Business Day preceding the related Payment Date, beginning July 18, 2023. “ Issuer ” means ACM Auto Trust 2023 - 2, a Delaware statutory trust established pursuant to the Trust Agreement, until a successor replaces it and, thereafter, means the successor and, for purposes of any provision contained in the Transaction Documents, each other obligor on the Notes. “ Issuer Order ” and “ Issuer Request ” means a written order or request of the Issuer signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee. “ Lien ” means, for any asset or property of a Person, a lien, security interest, mortgage, pledge or encumbrance in, of or on such asset or property in favor of any other Person, except any Xxxxxxxxx Xxxx . “ Liquidation Expenses ” means, with respect to any Defaulted Receivable and any Receivable for which the related Financed Vehicle has been repossessed, any expenses (including, without limitation, any auction, painting, repair or refurbishment expenses in respect of the related Financed Vehicle) incurred by the Servicer in connection with the collection of such Receivable or the repossession or liquidation of the related Financed Vehicle . “ Liquidation Proceeds ” means, with respect to any Defaulted Receivable, (a) insurance proceeds received by the Servicer, (b) amounts received by the Servicer in connection with such Receivable pursuant to the exercise of rights under that Receivable and (c) the monies collected by the Servicer (from whatever source, including proceeds of a sale of a Financed Vehicle, a Deficiency Balance recovered from the Obligor after the charge - off of such Receivable or as a
753507398 23738694 A - 14 Definitions (ACMAT 2023 - 2) result of any recourse against an unrelated third - party, if any) on such Receivable other than any monthly payments by or on behalf of the Obligor thereunder or any full or partial prepayment of such Receivable, in the case of each of the foregoing clauses (a) through (c), net of any outstanding related Liquidation Expenses and any payments required by law to be remitted to the related Obligor ; provided , however , that the Repurchase Price for any Receivable shall not constitute “Liquidation Proceeds” . “ Majority Certificateholders ” means Certificateholders holding in the aggregate more than 50% of the Percentage Interests. “ Monthly Data File ” means the monthly data file delivered pursuant to Section 3.8 of the Sale and Servicing Agreement. “ Net Liquidation Proceeds ” means, for any Collection Period, the sum of all Liquidation Proceeds received during such Collection Period less all Liquidation Expenses incurred during such Collection Period. “ Note ” means a Class A Note or Class B Note, in each case substantially in the forms of Exhibit A to the Indenture. “ Note Balance ” means, with respect to any date of determination, for any Class, the Class A Note Balance or the Class B Note Balance, as applicable, or, with respect to the Notes generally, the sum of all of the foregoing. “ Note Factor ” means, for any Payment Date and each Class of Notes, a six - digit decimal figure equal to the Note Balance of such Class of Notes as of the end of the related Collection Period divided by the Note Balance of such Class of Notes as of the Closing Date. The Note Factor will be 1.000000 as of the Closing Date; thereafter, the Note Factor will decline to reflect reductions in the Note Balance of such Class of Notes. “ Note Owner ” means, with respect to a Book - Entry Note, the Person who is the beneficial owner of such Book - Entry Note, as reflected on the books of the Clearing Agency or a Person maintaining an account with such Clearing Agency (directly as a Clearing Agency Participant or as an indirect participant, in each case in accordance with the rules of such Clearing Agency). “ Note Purchase Agreement ” means the Note Purchase Agreement, dated as of June 28, 2023, between the Structuring Agent, the Initial Purchasers, the Sponsor, Colonial and the Depositor. “ Note Register ” and “ Note Registrar ” have the respective meanings set forth in Section 2.4 of the Indenture. “ Noteholder ” means, as of any date, the Person in whose name a Note is registered on the Note Register on such date. “ Notes ” means, collectively, the Class A Notes and the Class B Notes.
753507398 23738694 A - 15 Definitions (ACMAT 2023 - 2) “ NRSRO ” means the Rating Agency, or any other nationally recognized statistical rating organization. “ Obligor ” means, for any Receivable, each Person obligated to pay such Receivable. “ Offering Memorandum ” means the final offering memorandum dated June 28, 2023 relating to the Notes. “ Officer’s Certificate ” means (i) with respect to the Issuer, a certificate signed by any Authorized Officer of the Administrator on behalf of the Issuer, and (ii) with respect to the Seller, the Administrator or the Servicer, a certificate signed by the chairman of the board, the president, any executive vice president, any vice president, the treasurer, any assistant treasurer or the controller of the Seller, the Administrator or the Servicer, as applicable. “ Opinion of Counsel ” means one or more written opinions of counsel who may, except as otherwise expressly provided in the Indenture or any other applicable Transaction Document, be employees of or counsel to the Issuer, the Servicer, the Seller or the Administrator, and which opinion or opinions comply with any applicable requirements of the Transaction Documents and are in form and substance reasonably satisfactory to the recipient(s). Opinions of Counsel need address matters of law only and may be based upon stated assumptions as to relevant matters of fact. “ Optional Purchase Price ” means, on any Payment Date, the greater of (a) the aggregate Outstanding Note Balance plus accrued and unpaid interest thereon at the applicable Interest Rate up to but excluding that Payment Date (after giving effect to all distributions pursuant to Section 4.4(a) of the Sale and Servicing Agreement on such Payment Date) and (b) the Pool Balance. “ Originators ” means, collectively, America’s Car Mart, Inc. and Texas Car - Mart, Inc. “ Other Assets ” means any assets (or interests therein) conveyed or purported to be conveyed by the Seller to another Person or Persons other than the Issuer, whether by way of a sale, capital contribution or by virtue of the granting of a lien. “ Outstandin g” means, as of any date, all Notes (or all Notes of an applicable Class) theretofore authenticated and delivered under the Indenture except: (i) Notes (or Notes of an applicable Class) theretofore cancelled by the Note Registrar or delivered to the Note Registrar for cancellation; (ii) Notes (or Notes of an applicable Class) or portions thereof the payment for which money in the necessary amount has been theretofore deposited with the Indenture Trustee or any Paying Agent in trust for the related Noteholders ( provided , however , that if such Notes are to be redeemed, notice of such redemption has been duly given pursuant to the Indenture or provision therefor, satisfactory to the Indenture Trustee, has been made); and (iii) Notes (or Notes of an applicable Class) in exchange for or in lieu of other Notes (or Notes of such Class) that have been authenticated and delivered pursuant to the Indenture
753507398 23738694 A - 16 Definitions (ACMAT 2023 - 2) unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a bona fide purchaser; provided that in determining whether Noteholders holding the requisite Note Balance have given any request, demand, authorization, direction, notice, consent, vote or waiver hereunder or under any Transaction Document, Notes owned by the Issuer, the Seller, any Certificateholder, the Servicer, the Administrator or any of their respective Affiliates shall be disregarded and deemed not to be Outstanding unless all of the Notes are then owned by the Issuer, the Seller, any Certificateholder, the Servicer, the Administrator or any of their respective Affiliates, except that, in determining whether the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, vote or waiver, only Notes that a Responsible Officer of the Indenture Trustee knows to be so owned shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee thereof establishes to the satisfaction of the Indenture Trustee such pledgee’s right so to act with respect to such Notes and that such pledgee is not the Issuer, the Seller, any Certificateholder, the Servicer, the Administrator or any of their respective Affiliates. “ Owner Trustee ” means BNY Mellon Trust of Delaware, a Delaware banking corporation, not in its individual capacity but solely as owner trustee under the Trust Agreement, and any successor Owner Trustee thereunder. “ Paying Agent ” means the Indenture Trustee or any other Person that meets the eligibility standards for the Indenture Trustee set forth in Section 6 . 11 of the Indenture and is authorized by the Issuer to make the payments of principal of or interest on the Notes on behalf of the Issuer . “ Payment Date ” means the 20 th day of each calendar month; provided , however , whenever a Payment Date would otherwise be a day that is not a Business Day, the Payment Date shall be the next Business Day. The initial Payment Date will be July 20, 2023. As used herein, the “related” Payment Date with respect to a Collection Period shall be deemed to be the Payment Date which immediately follows such Collection Period. “ Payment Default ” has the meaning set forth in Section 5.4(a) of the Indenture. “ Percentage Interest ” means, with respect to a Certificate, the individual percentage interest of such Certificate, which shall be specified on the face thereof and which shall represent the percentage of certain distributions of the Issuer beneficially owned by such Certificateholder. The sum of the Percentage Interests for all of the Certificates shall be 100%. “ Permitted Liens ” means (a) any liens created by the Transaction Documents, (b) any liens for taxes not yet due and payable or the amount of which is being contested in good faith by appropriate Proceedings, (c) any liens of mechanics, suppliers, vendors, materialmen, laborers, employees, repairmen and other like liens securing obligations which are not due and payable or the amount or validity of which is being contested in good faith by appropriate Proceedings and (d) any liens created by the Obligor that are subordinate to the lien created by the Receivable. “ Person ” means any individual, corporation, limited liability company, estate, partnership, joint venture, association, joint stock company, trust (including any beneficiary
753507398 23738694 A - 17 Definitions (ACMAT 2023 - 2) thereof), unincorporated organization or government or any agency or political subdivision thereof. “ Physical Property ” has the meaning specified in the definition of “ Delivery ” above. “ Plan ” means an “employee benefit plan” as defined in Section 3(3) of ERISA whether or not subject to Title I of ERISA, a “plan” as defined in Section 4975 of the Code, or an entity or account deemed to hold plan assets of any of the foregoing. “ Pool Balance ” means, at any time, the aggregate outstanding Principal Balance of the Receivables (other than Defaulted Receivables) at such time. “ Pool Factor ” means, for any Payment Date, a six - digit decimal equal to the Pool Balance as of the end of the related Collection Period divided by the aggregate Principal Balance of the Receivables as of the Cut - Off Date . The Pool Factor will be 1 . 000000 as of the Closing Date ; thereafter, the Pool Factor will decline to reflect reductions in the Pool Balance . “ Predecessor Note ” means, with respect to any particular Note, every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; provided , however , for the purpose of this definition, any Note authenticated and delivered under Section 2.5 of the Indenture in lieu of a mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Note. “ Principal Balance ” means, as of any time, for any Receivable, the outstanding principal balance of such Receivable determined in accordance with the Customary Servicing Practices . “ Proceeding ” means any suit in equity, action at law or other judicial or administrative proceeding. “ Purchase Agreement ” means the Purchase Agreement, dated as of the Closing Date, between Colonial, as seller, and the Seller, as buyer, as amended, restated, modified or supplemented from time to time. “ Purchased Assets ” has the meaning set forth in Section 2.1 of the Purchase Agreement. “ Qualified Institutional Buyer ” has the meaning specified in Rule 144A. “ Rating Agency ” means S&P. “ Rating Agency Condition ” means, with respect to any event or circumstance and the Rating Agency, either (a) written confirmation (which may be in the form of a letter, a press release or other publication, or a change in the Rating Agency’s published ratings criteria to this effect) by the Rating Agency that the occurrence of such event or circumstance will not cause the Rating Agency to downgrade, qualify or withdraw its rating assigned to any of the Notes or (b) that the Rating Agency will have been given notice of that event or circumstance at least ten days prior to the occurrence of that event or circumstance (or, if ten days’ advance notice is impracticable, as much advance notice as is practicable and is acceptable to the Rating Agency) and the Rating Agency shall not have issued any written notice that the occurrence of that event
753507398 23738694 A - 18 Definitions (ACMAT 2023 - 2) or circumstance will itself cause the Rating Agency to downgrade, qualify or withdraw its rating assigned to any of the Notes. “ Receivable ” means any Contract with respect to a used automobile, light - duty truck, SUV or van which shall appear on the Schedule of Receivables and all Related Security in connection therewith which has not been released from the lien of the Indenture. “ Receivable File ” has the meaning set forth in Section 2.2(a) of the Sale and Servicing Agreement. “ Record Date ” means, unless otherwise specified in any Transaction Document, with respect to any Payment Date or Redemption Date, (i) for any Definitive Notes and for the Certificates, the close of business on the last Business Day of the calendar month immediately preceding the calendar month in which such Payment Date or Redemption Date occurs and (ii) for any Book - Entry Notes, the close of business on the Business Day immediately preceding such Payment Date or Redemption Date . “ Records ” means, for any Receivable, all contracts, books, records and other documents or information (including computer programs, tapes, disks, software and related property and rights, to the extent legally transferable) relating to such Receivable or the related Obligor . “ Redemption Date ” means, in the case of a redemption of the Notes pursuant to Section 10.1 of the Indenture, the Payment Date specified by the Administrator or the Issuer pursuant to Section 10.1 of the Indenture. “ Redemption Price ” means an amount equal to the sum of (a) the unpaid Note Balance of all Notes redeemed plus (b) accrued and unpaid interest thereon at the applicable Interest Rate for the Notes being so redeemed, up to but excluding the Redemption Date . “ Registered Holder ” means the Person in whose name a Note is registered on the Note Register on the related Record Date. “ Regular Allocation of Principal ” means, with respect to any Payment Date, an amount not less than zero equal to ( 1 ) the excess, if any, of (a) the Note Balance of the Notes as of such Payment Date (before giving effect to any principal payments made on the Notes on such Payment Date) over (b) (i) the Pool Balance as of the end of the related Collection Period less (ii) the Targeted Overcollateralization Amount minus ( 2 ) the sum of the First Allocation of Principal and the Second Allocation of Principal for such Payment Date . “ Related Security ” means, for any Receivable, (i) the security interest in the related Financed Vehicle, (ii) any rights to any proceeds from claims on any related Insurance Policy or refunds in connection with extended service agreements relating to such Receivable (if such Receivable became a Defaulted Receivable after the Cut - Off Date), (iii) any other property securing such Receivable and (iv) all proceeds of the foregoing. “ Repurchase Price ” means, with respect to any Repurchased Receivable, a price equal to the outstanding Principal Balance of such Receivable plus any unpaid accrued interest related to
753507398 23738694 A - 19 Definitions (ACMAT 2023 - 2) such Receivable accrued to and including the end of the Collection Period preceding the date that such Repurchased Receivable was purchased by Colonial or the Servicer, as applicable. “ Repurchased Receivable ” means a Receivable purchased by Colonial pursuant to Section 3.4 of the Purchase Agreement or by the Servicer pursuant to Section 3.6 of the Sale and Servicing Agreement. “ Reserve Account ” means the account designated as such, established and maintained pursuant to Section 4.1 of the Sale and Servicing Agreement. “ Reserve Account Draw Amount ” means, for any Payment Date, an amount equal to the lesser of (a) the Available Funds Shortfall Amount, if any, for such Payment Date and (b) the amount of cash or other immediately available funds on deposit in the Reserve Account (excluding any net investment earnings) on such Payment Date ; provided , however , that if such Payment Date is the Redemption Date, the “Reserve Account Draw Amount” shall mean an amount equal to the amount of cash or other immediately available funds on deposit in the Reserve Account on the Redemption Date . “ Reserve Account Excess Amount ” means, with respect to any Payment Date, an amount equal to the excess, if any, of (a) the amount of cash or other immediately available funds in the Reserve Account (excluding any net investment earnings) on that Payment Date, after giving effect to all deposits to and withdrawals from the Reserve Account on such Payment Date, over (b) the Specified Reserve Account Balance with respect to such Payment Date . “ Responsible Officer ” means, (a) with respect to the Indenture Trustee, the Backup Servicer, the Paying Agent, the Calculation Agent, any officer within the corporate trust department of such Person, including any vice president, assistant vice president, assistant secretary, assistant treasurer, trust officer or any other officer of such Person who customarily performs functions similar to those performed by the persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of the Indenture, (b) with respect to the Owner Trustee or any officer within the Corporate Trust Office of the Owner Trustee including any vice president, assistant vice president, assistant treasurer, assistant secretary or any other officer customarily performing functions similar to those performed by any of the above designated officers and having direct responsibility for the administration of the Issuer, and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject and (c) with respect to the Servicer, the Administrator or Seller, any officer of such Person having direct responsibility for the transactions contemplated by the Transaction Documents, including the president, treasurer or secretary, or any vice president, assistant vice president, assistant treasurer, assistant secretary or any other officer customarily performing functions similar to those performed by any of the above designated officers and also, with respect to a particular matter, any other officer to whom such matter is referred because of such officer’s knowledge of and familiarity with the particular subject. “ Restricted Notes ” means any Note for which no Debt - For - Tax Opinion has been rendered on or after the later of (i) the Closing Date and (ii) the most recent date on which such
753507398 23738694 A - 20 Definitions (ACMAT 2023 - 2) Note was beneficially owned by the Issuer or the single beneficial owner of the Issuer for United States federal income tax purposes. “ Rule 144A ” means Rule 144A under the Securities Act and any successor rule thereto. “ Rule 144A Information ” means the information specified pursuant to Rule 144A(d)(4) of the Securities Act (or any successor provision thereto). “ S&P ” means S&P Global Ratings, or any successor that is a nationally recognized statistical rating organization. “ Sale and Servicing Agreement ” means the Sale and Servicing Agreement, dated as of the Closing Date, between the Issuer, the Seller, the Servicer, the Indenture Trustee, the Backup Servicer, the Calculation Agent and the Paying Agent, as the same may be amended, restated, modified or supplemented from time to time. “ Schedule of Receivables ” means the electronic data file of the Receivables transferred to the Issuer on the Closing Date on file with the Servicer. “ Second Allocation of Principal ” means, with respect to any Payment Date, an amount equal to (1) the excess, if any, of (a) the sum of the Class A Note Balance and the Class B Note Balance as of such Payment Date (before giving effect to any principal payments made on the Class A Notes and the Class B Notes on such Payment Date) over (b) the Pool Balance as of the end of the related Collection Period minus (2) the First Allocation of Principal for such Payment Date; provided , however , that the Second Allocation of Principal on and after the Final Scheduled Payment Date for the Class B Notes shall not be less than the amount that is necessary to reduce the Note Balance of the Class B Notes to zero (after the application of the First Allocation of Principal). “ Section 385 Controlled Partnership ” has the meaning set forth in Treasury Regulation Section 1.385 - 1(c)(1) for a “controlled partnership”. “ Section 385 Expanded Group ” has the meaning set forth in Treasury Regulation Section 1.385 - 1(c)(4) for an “expanded group.” “ Securities Act ” means the Securities Act of 1933, as amended. “ Seller ” means ACM Funding, LLC, a Delaware limited liability company, in its capacity as Seller under the Sale and Servicing Agreement. “ Servicer ” means, initially, America’s Car Mart, and any replacement Servicer appointed pursuant to the Sale and Servicing Agreement. “ Servicer Replacement Event ” means any one or more of the following that shall have occurred and be continuing: (a) any failure by the Servicer to deliver or cause to be delivered any required payment to the Indenture Trustee for distribution to the Noteholders, which failure continues
753507398 23738694 A - 21 Definitions (ACMAT 2023 - 2) unremedied for five (5) Business Days after discovery thereof by a Responsible Officer of the Servicer or receipt by the Servicer of written notice thereof from the Indenture Trustee or Noteholders evidencing at least 25% of the Note Balance, voting together as a single Class; (b) any failure by the Servicer to duly observe or perform in any respect any other of its covenants or agreements in the Sale and Servicing Agreement, which failure materially and adversely affects the rights of the Issuer or the Noteholders and which continues unremedied for 90 days after discovery thereof by a Responsible Officer of the Servicer or receipt by the Servicer of written notice thereof from the Indenture Trustee or Noteholders evidencing at least a majority of the aggregate Note Balance of all Outstanding Notes; provided , however , that no Servicer Replacement Event will result from the breach by the Servicer of any covenant for which the purchase of the affected Receivable is specified as the sole remedy pursuant to Section 3.6 of the Sale and Servicing Agreement; or (c) the Servicer suffers a Bankruptcy Event; provided , however , that (A) if any delay or failure of performance referred to in clause (a) above shall have been caused by force majeure or other similar occurrence, the five Business Day grace period referred to in such clause (a) shall be extended by an additional 60 calendar days and (B) if any delay or failure of performance referred to in clause (b) above shall have been caused by force majeure or other similar occurrence, the 90 day grace period referred to in such clause (b) shall be extended for an additional 60 calendar days. “ Servicing Centralization Expenses ” has the meaning set forth in Section 1.1 of the Backup Servicing Agreement. “ Servicing Fee ” means, for any Payment Date, the product of (A) one - twelfth, (B) the Servicing Fee Rate and (C) the Pool Balance as of the first day of the related Collection Period (or, in the case of the first Payment Date, as of the Cut - Off Date); provided , that in the case of the Successor Servicer, in no event will the Servicing Fee payable on any Payment Date be less than $5,000. “ Servicing Fee Rate ” means 4.00% per annum. “ Servicing Transition Costs ” has the meaning set forth in Section 1.1 of the Backup Servicing Agreement. “ Similar Law ” means any applicable law that is substantially similar to Title I of ERISA or Section 4975 of the Code. “ Simple Interest Method ” means the method of calculating interest due on a motor vehicle receivable on a daily basis based on the actual outstanding principal balance of the receivable on that date . “ Simple Interest Receivable ” means any motor vehicle receivable pursuant to which the payments due from the Obligors during any month are allocated between interest, principal and other charges based on the actual date on which a payment is received and for which interest is calculated using the Simple Interest Method .
753507398 23738694 A - 22 Definitions (ACMAT 2023 - 2) “ Specified Reserve Account Balance ” means, for any Payment Date, an amount equal to 2 . 00 % of the Pool Balance as of the Cut - Off Date ; provided , however , on any Payment Date after the Notes are no longer Outstanding following payment in full of the principal of and interest on the Notes, the “Specified Reserve Account Balance” shall be $ 0 . “ Sponsor ” means America’s Car Mart, Inc., an Arkansas corporation. “ Statutory Trust Statute ” means Chapter 38 of Title 12 of the Delaware Code, 12 Del. Code † 3801 et seq. “ Structuring Agent ” means ATLAS SP Securities, a division of Apollo Global Securities, LLC. “ Successor Servicer ” means, initially, the successor to America’s Car Mart under the terms of the Transaction Documents, and any replacement Servicer appointed thereafter pursuant to the Sale and Servicing Agreement. “ Supplemental Servicing Fees ” means any and all (i) late fees, (ii) extension fees, (iii) non - sufficient funds charges and (iv) any and all other administrative fees or similar charges allowed by applicable law with respect to any Receivable. “ Targeted Overcollateralization Amount ” means, for each Payment Date, 37.20% of the Pool Balance as of the Cut - Off Date. “ Tax Information ” means information and/or properly completed and signed tax certifications sufficient to eliminate the imposition of or to determine the amount of any withholding of tax, including FATCA Withholding, imposed on payments to the provider, and to allow the recipient to comply with any reporting or other obligations under any applicable tax law, including but not limited to Internal Revenue Service Form W - 9, W - 8BEN, W - 8BEN - E, W - 8ECI or W - 8IMY, as applicable, and any required supporting documentation. “ TIA ” or “ Trust Indenture Act ” means the Trust Indenture Act of 1939, as amended and as in force on the date hereof, unless otherwise specifically provided. “ Transaction Documents ” means the Indenture, the Notes, the Depository Agreement, the Sale and Servicing Agreement, the Purchase Agreement, the Administration Agreement, the Backup Servicing Agreement, the Trust Agreement and the Certificates, as the same may be amended or modified from time to time. “ Transferred Assets ” means (a) the Purchased Assets, (b) all of the Seller’s rights under the Purchase Agreement, including the rights to enforce the repurchase obligation of Colonial for breaches of the representations and warranties of Colonial set forth in Schedule II to the Purchase Agreement, and (c) all proceeds of the foregoing. “ Trust Account Property ” means the Trust Accounts, all amounts and investments held from time to time in any Trust Account (whether in the form of deposit accounts, Physical Property, book - entry securities, uncertificated securities or otherwise), and all proceeds of the foregoing.
753507398 23738694 A - 23 Definitions (ACMAT 2023 - 2) “ Trust Accounts ” means the Collection Account and the Reserve Account. “ Trust Agreement ” means the Amended and Restated Trust Agreement, dated as of the Closing Date, between the Depositor and the Owner Trustee, as the same may be amended, restated, modified or supplemented from time to time. “ Trust Estate ” means all money, accounts, chattel paper, general intangibles, goods, instruments, investment property and other property of the Issuer, including, without limitation, (i) the Receivables acquired by the Issuer under the Sale and Servicing Agreement, the Related Security relating thereto and Collections thereon after the Cut - Off Date, (ii) all Receivable Files, (iii) the rights of the Issuer to the funds on deposit from time to time in the Trust Accounts (including the Initial Reserve Account Deposit Amount) and any other account or accounts established pursuant to the Indenture or Sale and Servicing Agreement and all cash, investment property and other property from time to time credited thereto and all proceeds thereof (including investment earnings, net of losses and investment expenses, on amounts on deposit therein, other than as provided in Section 3.7 of the Sale and Servicing Agreement), (iv) the rights of the Seller, as buyer, under the Purchase Agreement, (v) the rights of the Issuer under the Sale and Servicing Agreement, the Backup Servicing Agreement and the Administration Agreement and (vi) all proceeds of the foregoing. “ UCC ” means, unless the context otherwise requires, the Uniform Commercial Code as in effect in the relevant jurisdiction, as amended from time to time. “ United States ” or “ USA ” means the United States of America (including all states, the District of Columbia, territories and political subdivisions thereof). “ Unrelated Amounts ” means (a) amounts deposited by the Servicer into the Collection Account but later determined by the Servicer to be mistaken or returned deposits or postings, (b) amounts deposited by the Servicer into the Collection Account as Collections but which were later determined by the Servicer to not constitute Collections with respect to the Receivables and (c) amounts received by the Servicer with respect to a Receivable that the Servicer is prohibited from depositing into the Collection Account or otherwise remitting to the Issuer by law or court order, the direction of a regulatory authority or regulatory guidance . “ U.S. Tax Person ” means a Person that is a “United States person” as defined in Section 7701(a)(30) of the Code, generally including: (a) a citizen or resident of the United States; (b) a corporation or partnership organized in or under the laws of the United States, any State or the District of Columbia; (c) an estate, the income of which is includible in gross income for United States tax purposes, regardless of its source; or (d) a trust if a U.S. court is able to exercise primary supervision over the administration of the trust and one or more U.S. Tax Persons have the authority to control all substantial decisions of the trust or a trust that has elected to be treated as a U.S. Tax Person.
753507398 23738694 A - 24 Definitions (ACMAT 2023 - 2) The foregoing definitions shall be equally applicable to both the singular and plural forms of the defined terms. Unless otherwise inconsistent with the terms of this Agreement, all accounting terms used herein shall be interpreted, and all accounting determinations hereunder shall be made, in accordance with GAAP. Amounts to be calculated hereunder shall be continuously recalculated at the time any information relevant to such calculation changes.