--- title: "Tricolor Holdings — Tricolor Funding SPV 4: the warehouse structure and collateral rights" language: en canonical: https://dossiertwist.com/dossiers/tricolor-holdings/funding-spv-4/ as_of: 2026-10-13 keywords: ["Tricolor Holdings","auto loans","securitization","warehouse financing","Daniel Chu","Chapter 7","TAST","Origin Bank","Vervent"] --- # Tricolor Holdings — Tricolor Funding SPV 4: the warehouse structure and collateral rights - Jurisdiction: US (US) - LEI: 549300JSE351WUCUA498 (GLEIF) - Company register: 3687536 (Delaware identity in retained LEI record) **Question.** Who borrowed, serviced and held security under the SPV 4 facility? **Answer.** The 2020 agreement identifies a distinct borrower, owner, guarantor, agent, custodian and backup servicer. Its covenants and security language must be distinguished from actual collateral quality and later priority disputes. ## From vehicle inventory to warehouse loans and securitization - Analysis: Tricolor used three connected financing stages. Floorplan lenders financed vehicle inventory. Warehouse special-purpose companies bought originated auto loans and borrowed against the receivables and related collateral. Securitization trusts then issued notes to investors; sale proceeds bought the loan pools and repaid warehouse debt. Tricolor Auto Acceptance sold receivables to its wholly owned depositor, Tricolor Auto Receivables 2, which transferred them to the issuing trusts. The noteholders’ complaint describes the associated cash flow through the warehouse companies. These accounts describe different legs of the transaction rather than interchangeable borrower entities. [s-d5] [s-d9] [s-d32] [s-d63] [s-d72] [s-d83] [s-d84] [s-d111] [s-d114] - Qualification: The original SPV 4 facility began with a $100 million lender commitment. Later litigation describes a limit of $777 million and SPV 6’s $250 million limit. Limits, outstanding debt and collateral values are different measures. The indictment anonymizes lenders; named-company matches require independent support. A later stated 70–80% advance rate does not rewrite the original 2020 contract’s 40% credit enhancement, which ordinarily left a 60% advance against the eligible balance. The bankruptcy estate and the non-debtor warehouse companies also have different assets and obligations. ## The SPV 4 contract and competing collateral claims - Analysis: The 13 November 2020 SPV 4 agreement identifies Tricolor Funding SPV 4 LLC as borrower, Tricolor Auto Acceptance as its direct sole member and initial servicer, Holdings as performance guarantor, JPMorgan Chase Bank as administrative agent, Vervent as backup servicer, and Wilmington Trust National Association as collateral custodian and account bank. Wells Fargo is the master collection account bank. The contract names originator transfer agreements with Auto Group, California Auto Group and Flexi Compras Autos, followed by the receivables purchase arrangement with Auto Acceptance. It grants the agent security over receivables, related vehicle interests, collections and specified contractual rights. [s-d70] [s-d83] [s-d84] [s-d318] - Qualification: Contractual representations of clean title and required UCC filings are not proof that every receivable actually existed, was unencumbered or had a completed filing. The agreement’s minimum 51% Holdings-to-Auto-Acceptance control condition is a covenant, not a measured ownership percentage. A blank release form is not an executed release. The clause naming Chu as key person is a contractual trigger, not ownership by SPV 4 of Chu. The historical document does not establish that every term remained unchanged until collapse. - Response: In its October 2025 filing, JPMorgan as agent preserved the lenders’ ownership and lien claims, contested the estate’s description of cash and vehicles as estate assets, and supported only specified cash uses subject to protections. The agent acknowledged uncertainty over fictitious and double-pledged loans; an asserted first lien is not a judicial resolution of competing collateral claims. - Outcome: The agent’s account says Auto Acceptance’s SPV 4 servicing role ended on 5 September 2025 and Vervent succeeded it. It reports $612,748,356 principal outstanding on 15 August 2025. SPV 4 was not one of the jointly administered debtors. ## Contractual tests are not proof of compliance - Analysis: The original SPV 4 contract limits concentration in the eligible pool: Texas borrowers to 80%, California to 40%, a single dealership to 10%, loans above 140% loan-to-value to 32.5%, borrowers with no FICO score to 60%, and scores below 500 to 10%. It also sets credit-tier limits and a 10% Ganas Ya brand limit. Ordinary required credit enhancement was 40%, rising to 50% after an uncured step-up trigger and to 100% after termination. Group covenants included a tangible-net-worth formula, $3 million unrestricted cash and a 1.25 debt-service ratio. [s-d84] - Qualification: These are the 2020 instrument’s contractual tests, not observed portfolio percentages or proof of compliance. Other instruments or later periods may use different ratios; the SEC’s account of a 1.35 covenant does not replace this contract’s text. ## Sources - [s-d5] Company statement concerning Tricolor or the identified participant, U.S. Securities and Exchange Commission - [s-d9] Media source · s-d9 - [s-d32] Regulatory record concerning Tricolor or the identified participant, U.S. Department of Justice - [s-d63] Company statement source · s-d63 - [s-d72] Court record source · s-d72 - [s-d83] Company statement source · s-d83 - [s-d84] Company statement source · s-d84 - [s-d111] Other source · s-d111 - [s-d114] Media source · s-d114 - [s-d70] Other source · s-d70 - [s-d318] Corporate registry concerning Tricolor or the identified participant, Global Legal Entity Identifier Foundation