Exhibit 10.14
Confidential Materials omitted
and filed separately with the
Securities and Exchange Commission. Asterisks denote
omissions.
AMENDED AND RESTATED NOTE
PURCHASE AGREEMENT
BANK OF AMERICA SCHOOL CHANNEL
LOAN PROGRAMS
This Amended and Restated Note
Purchase Agreement (this “Agreement”), by and between
BANK OF AMERICA, N.A. (“Program Lender”), a national
banking association organized under the laws of the United States
and having a place of business located at 600 Wilshire Blvd., Los
Angeles, California 90017, and THE FIRST MARBLEHEAD CORPORATION, a
Delaware corporation having a principal place of business at having
a principal place of business at 800 Boylston Street, 34
th Floor, Boston,
Massachusetts 02199-8157 (“FMC”), is made and
dated as of June 30, 2006;
W I T N E S S E T H:
WHEREAS, Program Lender is in the
business of making education loans under education lending
programs, including, without limitation, the Bank of America School
Channel Loan Programs (as hereinafter defined); and
WHEREAS, FMC exists to arrange
funding for education loans for the benefit of students at
Participating Institutions; and
WHEREAS, in order to facilitate
funding of Bank of America School Channel Conforming Loans, Program
Lender has agreed to sell, from time to time, pools containing Bank
of America School Channel Conforming Loans originated by Program
Lender to FMC or a Purchaser Trust (all as hereinafter
defined).
WHEREAS, the Bank of America School
Channel Loans are made by Program Lender and purchased by FMC on
the condition that they qualify for and in fact are covered by a
guaranty issued by The Education Resources Institute, Inc.
(“TERI”).
NOW, THEREFORE, in consideration of
these presents and the covenants contained herein, the parties
hereto hereby agree as follows:
I.
Definitions.
Capitalized terms used herein
without definition have the meanings set forth in the Program
Guidelines or the Umbrella Agreement, as applicable.
“Affiliate” shall mean,
as to any person, any other person which, directly or indirectly,
is in control of, is controlled by, or is under common control
with, such person. A person shall be deemed to control another
person if the controlling person possesses, directly or indirectly,
the power to direct or to cause the direction of the management and
policies of the other person, whether through the ownership of
voting securities, by contract or otherwise.
“Agent” means U.S. Bank
National Association, in its capacity as agent pursuant to the
Deposit and Security Agreement.
“Bank of America Private Loan
Programs” means the prepGATE Loan Program, the Bank of
America Private Undergraduate Loan Program and the Bank of America
Private Graduate Professional Loan Programs, each as more fully
described in the Program Guidelines as the same may be amended from
time to time.
1
“Bank of America School
Channel Loan Programs” or “Bank of America SC Loan
Programs” means the Bank of America Private Loan Programs and
the Bank of America TERI Loan Programs, each as more fully
described in the Program Guidelines as the same may be amended from
time to time.
“Bank of America SC Loan
Pool” or “Pool” shall mean and refer to a group
of Bank of America SC Notes purchased and pledged or intended to be
purchased and pledged as collateral in a particular Securitization
Transaction.
“Bank of America SC
Notes” or “Notes” shall mean notes or other forms
of consumer debt instruments, evidencing Bank of America SC
Conforming Loans.
“Bank of America TERI Loan
Programs” means the Bank of America TERI Alternative
Undergraduate Loan Program, the Bank of America TERI Alternative
Graduate Loan Program, the Bank of America TERI Alternative
Continuing Education Loan Program, the Bank of America TERI
Alternative Health Professions Loan Program (including the CVS Loan
Program), and the Bank of America TERI ISLP Programs, each as more
fully described in the Program Guidelines as the same may be
amended from time to time.
“Bank of America TERI ISLP
Loan Programs” means the Bank of America ISLP Undergraduate
Loan Program, the Bank of America ISLP Graduate Loan Program and
the Bank of America ISLP Medical Loan Program, each as more fully
described in the Program Guidelines as the same may be amended from
time to time. It does not include the Bank of America ISLP CanHelp
Program, which is not governed by this Agreement.
“Business Day” shall
mean any day other than: (a) a Saturday or Sunday, or
(b) a day on which banking institutions in the State of
California are required or authorized by law or executive order to
be closed.
“Co-Lender Indemnification
Agreement” means the form of Agreement attached hereto as
Exhibit A .
“Collateral” has the
meaning set forth in the Deposit and Security Agreement.
“Conforming Loans” shall
mean loans (a) conforming to the requirements of the Program
Guidelines at the time the loans were made, (b) serviced by
the Servicer in accordance with the Program Guidelines, and
(c) covered by and subject to all the benefits of the Guaranty
Agreement.
“Deposit and Security
Agreement” means the agreement of that name among Program
Lender, TERI, FMC, and State Street Bank & Trust Company,
dated as of April 30, 2001.
“First Marblehead” or
“FMC” shall mean The First Marblehead Corporation, a
Delaware corporation.
“Guaranty Agreement”
means the Amended and Restated Guaranty Agreement between Program
Lender and TERI, dated as of June 30, 2006.
“Loan Origination
Agreement” refers to (a) the Amended and Restated Loan
Origination Agreement entered into between TERI and Program Lender
with respect to origination of prepGATE Conforming Loans and Bank
of America TERI Loans that are Conforming Loans, as amended from
time to time, and (b) any subsequent agreement relating to
origination services provided to Program Lender with respect to
Bank of America SC Loan Notes purchased under this
Agreement.
“Minimum Purchase Price”
has the meaning set forth in Section 2.04.
“Option Period” means,
with respect to any particular Bank of America SC Conforming Loan,
the period beginning on the first May 1 when such loan first
becomes a Seasoned Loan and ending [**] days thereafter.
2
“Origination Records”
means and refers to the original Bank of America SC Loan
Application and Note, a form of cosigner notice when required under
16 C.F.R. § 444, and any other standardized documentation
specified from time to time in the Program Guidelines as required
to be received by the Servicer from the Program Lender in order to
service Bank of America SC Conforming Loans adequately and
accurately.
“Participating
Institution” means an institution approved by TERI for
participation in the Bank of America SC Loan Programs.
“Program” shall mean,
collectively, the Bank of America Private Loan Programs and the
Bank of America TERI Loan Programs.
“Program Guidelines” has
the meaning set forth in the Umbrella Agreement.
“Purchase Date” shall
mean the date of consummation of a Securitization Transaction with
respect to a particular Pool including Bank of America SC
Conforming Loans originated by Program Lender, which date:
(a) shall be set by written notice from FMC to Program Lender,
given to Program Lender not less than five (5) Business Days
in advance of the specified date, and (b) shall occur [**] for
each loan in the Pool in question.
“Purchaser Trust” shall
mean and refer to a trust or other SPE formed for the purpose of
purchasing Bank of America SC Conforming Loans by FMC or by any
Affiliate of FMC. Any action required or permitted to be taken by
FMC hereunder may be taken by a Purchaser Trust with respect to a
particular Pool.
“Rating Agencies” shall
mean and refer to Standard and Poor’s Corporation and/or
Moody’s Investors Service, Inc., and/or Duff &
Phelps, and/or Fitch Investors Services.
“Seasoned Loan” means a
Bank of America SC Conforming Loan made by Program Lender that
becomes “seasoned” in accordance with the following
criteria:
(a)
The following Bank of America SC
Conforming Loans will be deemed to be “Seasoned Loans”
immediately upon final disbursement:
(i)
prepGATE Loans (as defined in the
Program Guidelines);
(b)
The following Bank of America SC
Conforming Loans will be deemed to be “Seasoned Loans”
twenty-four (24) months following final disbursement:
(i)
Bank of America Private
Undergraduate Education Loans, Bank of America TERI Alternative
Undergraduate Loans, and Bank of America ISLP Undergraduate Loans
(each as defined in the Program Guidelines) made to Borrowers in
their first (1 st
), second (2 nd ) or
third (3d) academic year; and,
(ii)
Bank of America TERI Alternative
Continuing Education Loans (as defined in the Program
Guidelines).
(c)
The following Bank of America SC
Conforming Loans will be deemed to be “Seasoned Loans”
upon the scheduled graduation date (i.e., at the beginning of the
grace period before scheduled repayment begins):
(i)
Bank of America Private
Undergraduate Education Loans, Bank of America TERI Alternative
Undergraduate Loans, and Bank of America ISLP Undergraduate Loans
made to Borrowers in their fourth (4th) or later academic
year;
3
(ii)
Bank of America Private Graduate
Professional Education Loans and Bank of America TERI Alternative
Graduate Loans, Bank of America ISLP Graduate Loans and Bank of
America ISLP Medical Loans (each as defined in the Program
Guidelines); and,
(iii) Bank of America TERI Alternative Health
Professions Loans (as defined in the Program
Guidelines).
(d)
Notwithstanding subparagraphs
(a) through (c), above:
(i)
any Bank of America SC Conforming
Loans will be deemed to be “Seasoned Loan” immediately
upon the occurrence of any of the following events:
(A)
the Bank of America SC Conforming
Loan enters repayment because the Borrower ceases to be enrolled at
the Participating Institution or in an approved residency period in
the case of a loan to a Borrower in a medical or dental degree
program, as and to the extent required by the Program Guidelines;
or
(B)
a “Guaranty Event” (as
defined in the Guaranty Agreement) occurs with respect to such Bank
of America SC Conforming Loan.
(ii)
any Bank of America Conforming Loan
that is a Bank of America Gate Undergraduate Loan, Bank of America
TERI Alternative Undergraduate Loan, or Bank of America ISLP
Undergraduate Loan and is made to Borrowers in their third
(3 rd ) academic year that has a scheduled graduation
date that occurs prior to twenty-four months following the final
disbursement date of the loan.
“Securitization Costs”
means the actual costs and expenses incurred by FMC, the Purchaser
Trust, and all others entitled to payment for expenses by the
Purchaser Trust or FMC, in connection with a Securitization
Transaction, including, without limitation, the
following:
(Structuring and Origination Fees;
Copy/Binding Costs)
(Underwriting Expenses)
(Rating Fee)
(Owner Trustee and Indenture Trustee Transaction and First Year
Fees; Expenses)
(Counsel for Indenture Trustee)
(Counsel for FMC)
(Servicer Audit)
(Bond Insurer)
“Securitization
Transaction” shall mean and refer to the purchase of a Pool
of Bank of America SC Conforming Loans by a Purchaser Trust funded
through the issuance and sale of commercial paper, certificates,
bonds or other securities or evidences of indebtedness, the
repayment of which is supported by payments on the Bank of America
SC Conforming Loans included in such Pool. A Securitization
Transaction may include, without limitation, a continuing series of
transactions occurring on a periodic basis in which Program Lender
makes a sale of then-outstanding Seasoned Loans to a Purchaser
Trust, which Purchaser Trust in turn either utilizes the Pool
directly as collateral for its own debt or resells the Pool (in
whole or in part) in further sales to a securitization conduit
providing financing to the Purchaser Trust.
“Servicer” shall mean
and refer to The Pennsylvania Higher Education Assistance Agency
(“PHEAA”), or such other servicer as may be retained by
the holder of Bank of America SC Conforming Loans in accordance
with the terms hereof and of the Umbrella Agreement.
“Servicing Agreement”
refers to: (a) the Servicing Agreement entered into between
Servicer and Program Lender with respect to servicing of Bank of
America SC Conforming Loans, as amended from
4
time to time, and (b) any
subsequent servicing agreement between Program Lender and the
Servicer governing servicing of Bank of America SC Conforming Loans
purchased under this Agreement.
“Servicing Assignment and
Servicer Consent Letter” means the form of assignment and
consent attached hereto as Exhibit B .
“SPE” means a special
purpose entity formed and operated for the sole purpose of acting
as purchaser and owner of Bank of America SC Conforming
Loans.
“Term” shall mean the
period commencing on the effective date hereof and ending upon
termination hereof, all as set forth in Article X.
“Trust Agreement” means,
with respect to any particular Securitization Transaction, the
agreement pursuant to which a Purchaser Trust is formed.
“Trust Indenture” means,
with respect to any particular Securitization Transaction, the
agreement pursuant to which FMC or a Purchaser Trust issues
evidences of indebtedness secured by the payments on the related
Bank of America SC Conforming Loans.
“Umbrella Agreement”
shall mean and refer to that certain Amended and Restated Umbrella
Agreement by and between Program Lender and First Marblehead, dated
as of June 30, 2006.
II.
Agreement for Purchase and
Sale of Notes.
2.01. Purchase and
Sale.
On each Purchase Date during the
Term of this Agreement and subject to the conditions set forth
herein, Program Lender shall sell to FMC or a designee Purchaser
Trust, and FMC or such Purchaser Trust shall purchase, every
Seasoned Loan owned by Program Lender on the Purchase
Date.
2.02. Pre-Closing
Information; FMC [**].
(a)
Reporting.
Program Lender will cause Servicer
to inform FMC periodically of information reasonably requested by
FMC in anticipation of a Securitization Transaction, including,
without limitation, the number of Seasoned Loans ready for
purchase, principal and accrued interest with respect to each such
Loan, payment status (including defaulted loans presented for
guaranty payment), and the identity of Participating Institutions
affected by the Securitization. Program Lender shall also provide
summary data, monthly, of applications in process and approved
loans not yet originated (numbers, dollar amounts by program,
borrower expected repayment date and other agreed data). Program
Lender will provide summary data, monthly, of rejected applications
(numbers and dollar amounts by program). Program Lender shall also
cause Servicer to provide its MR50 Reports to FMC. FMC covenants
and agrees that it will use data in the MR50 Report solely for the
purpose of producing portfolio-level reports specific to
forecasting and structuring Securitization Transactions. After
production of such reports, FMC will return all data storage
devices containing MR50 data to PHEAA and will delete all MR50 data
(other than the portfolio-level reports) from its
system.
FMC will [**] specify a Purchase
Date and consummate a Securitization Transaction in which a
Purchaser Trust will purchase all of the Seasoned Loans, not less
than once each calendar year. FMC shall have the sole and exclusive
right to purchase all Bank of America SC Conforming Loans [**] for
each such loan, which right may be assigned to one or more
Purchaser Trusts. Program Lender agrees, in consideration of
FMC’s undertaking pursuant to this section, not to sell to
any third person any interest in any Bank of America SC Conforming
Loans originated by Program Lender [**]. Program Lender shall be
free to use Bank of America SC Conforming Loans as collateral for
loans to Program Lender and/or to sell participations in its
portfolio of Bank of America SC Conforming Loans; provided,
however , that Program
5
Lender must sell and deliver
Seasoned Loans free and clear of any such interests on any Purchase
Date. Program Lender shall be entitled at any time and from time to
time, in its sole discretion, to sell a Seasoned Loan to a third
party or to retain a Bank of America SC Conforming Loan, in whole
or in part, for its own account, in the event that FMC or its
designee is unable to or fails to acquire such Seasoned Loan [**].
In such event, the Program Lender may sell or retain such Seasoned
Loan to any purchaser, free and clear of any claim under this
Agreement.
2.03. Pool
Supplement.
Each purchase and sale of the
Seasoned Loans originated by Program Lender included in a Pool on a
Purchase Date shall be made pursuant to a Pool Supplement
substantially in the form of Exhibit C which shall:
(1) set forth the Minimum Purchase Price for the Seasoned
Loans originated by Program Lender included in the Pool,
(2) incorporate by reference the terms and conditions of this
Agreement applicable to sales of Seasoned Loans, and
(3) include a Schedule of Seasoned Loans setting forth the
details and characteristics of such Pool. Each Pool Supplement
shall be executed by an authorized agent of each Purchaser Trust
and the Program Lender and shall be delivered on the related
Purchase Date. The Purchaser Trust shall provide a preliminary
settlement sheet in the form of Schedule 1 to the Pool Supplement
not less than two (2) Business Days prior to the Purchase
Date.
2.04. Minimum
Purchase Price.
2.04.01 For Bank of
America TERI Programs (excluding Bank of America TERI ISLP
Programs)
On the Purchase Date, Program Lender
shall assign and convey all Seasoned Loans that are Bank of America
TERI Loans (other than Bank of America TERI ISLP Loans) originated
by Program Lender included in the Pool to FMC, or a Purchaser
Trust, in consideration of receipt of the Minimum Purchase Price
therefor. For purposes of this Agreement the term “Minimum
Purchase Price” shall mean the sum of the following amounts
with respect to each of the Seasoned Loans to be purchased that are
Bank of America TERI Loans (other than Bank of America TERI ISLP
Loans):
(a)
The unpaid principal amount of the
Seasoned Loans in question [**]; plus
(b)
All accrued and unpaid interest on
such Seasoned Loans, [**]; plus
(c)
[**], the amount of any guaranty fee
paid by the Program Lender to The Education Resources
Institute, Inc. (“TERI”). If the terms of the
Guaranty Agreement call for any Guaranty Fees to be paid to TERI
[**]; plus
(d)
All fees paid by Program Lender to
TERI with respect to such Seasoned Loans [**]; plus
(e)
A marketing fee and loan premium,
[**]:
1.
with respect to Bank of America TERI
School Channel Undergraduate Creditworthy Loans, [**]% [**];
plus
2.
with respect to Bank of America TERI
School Channel Graduate Creditworthy Loans, [**]% [**];
plus
3.
with respect to Bank of America TERI
School Channel Graduate Credit-ready Loans, [**]%; plus
4.
with respect to Bank of America TERI
School Channel Continuing Education Loans, [**]% [**];
plus
5.
with respect to Bank of America TERI
School Channel Creditworthy Health Professions Loans (excluding CVS
Program Loans eligible for purchase under the Umbrella Agreement),
[**]% [**]; plus
6
6.
with respect to Bank of America TERI
School Channel Credit-ready Health Professions Loans and CVS
Creditworthy and Credit-ready Health Professions Loans eligible for
purchase under the Umbrella Agreement, [**]%; plus
7.
with respect to Bank of America
prepGATE Loans, [**]%;
8.
with respect to School Channel
Undergraduate Creditworthy Expanded Tier Loans, [**]%
[**];
9.
with respect to School Channel
Graduate Creditworthy Expanded Tier Loans, [**]% [**];
10,
with respect to School Channel
Creditworthy Health Profession Expanded Tier Loans, [**]%
[**].
2.04.02 For Bank of
America TERI ISLP Programs
On the Purchase Date, Program Lender
shall assign and convey all Seasoned Loans that are Bank of America
TERI ISLP Loans included in the Pool to FMC, or a Purchaser Trust,
in consideration of receipt of the Minimum Purchase Price therefor.
For purposes of this Agreement the term “Minimum Purchase
Price” shall mean the sum of the following amounts with
respect to each of the Seasoned Loans to be purchased that are Bank
of America TERI ISLP Loans:
(a)
The unpaid principal amount ([**])
of the Seasoned Loans in the Pool; plus
(b)
All accrued and unpaid interest on
such Seasoned Loans, [**]; plus
(c)
All fees paid by Program Lender to
TERI with respect to such Seasoned Loans [**]; plus
(d)
A marketing fee and loan premium,
[**]:
1.
with respect to Bank of America Bank
School Channel ISLP Undergraduate Creditworthy Loans, [**]%
[**];
2.
with respect to Bank of America Bank
School Channel ISLP Graduate Creditworthy Loans, [**]%
[**];
3.
with respect to Bank of America Bank
School Channel ISLP Graduate Credit-ready Loans, [**]%;
4.
with respect to Bank of America Bank
School Channel ISLP Medical Creditworthy Loans, [**]%;
5.
with respect to Bank of America Bank
School Channel ISLP Medical Credit-ready Loans, [**]%;
6.
with respect to Bank of America Bank
School Channel ISLP Medical Creditworthy Residency Loans,
[**]%;
7.
with respect to Bank of America Bank
School Channel ISLP Medical Credit-ready Residency Loans,
[**]%.
2.04.03 Bank of
America Private Loan Programs
On the Purchase Date, Program Lender
shall assign and convey all Seasoned Loans that are Bank of America
Private Loans included in the Pool to FMC, or a Purchaser Trust, in
consideration of receipt of the Minimum Purchase Price therefor.
For purposes of this Agreement the term “Minimum Purchase
Price” shall mean the sum of the following amounts with
respect to each of the Seasoned Loans to be purchased that are Bank
of America Private Loans:
(a)
The unpaid principal amount of the
Seasoned Loans in question [**]; plus
7
(b)
All accrued and unpaid interest on
such Seasoned Loans, [**]; plus
(c)
With respect to [**], the amount of
any guaranty fee paid by the Program Lender to The Education
Resources Institute, Inc. (“TERI”) [**];
plus
(d)
A marketing fee and loan premium,
[**]:
1.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Creditworthy Undergraduate Loans, [**]%;
2.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Creditworthy Graduate Loans, [**]%;
3.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Creditworthy Law Loans, [**]%;
4.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Creditworthy Business Loans, [**]%;
5.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Creditworthy Medical Loans, [**]%;
6.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Creditworthy Dental Loans, [**]%;
7.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Graduate Loans, [**]%;
8.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Law Loans, [**]%;
9.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Business Loans, [**]%;
10.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Medical Loans, [**]%;
11.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Dental Loans, [**]%;
12.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Bar Loans, [**]%;
13.
with respect to Bank of America
Private Loan Generic & Preferred School Channel
Credit-ready Relocation & Residency Loans,
[**]%;
14.
with respect to Bank of America
Private Loan [**] School Channel Creditworthy Graduate Loans,
[**]%;
15.
with respect to Bank of America
Private Loan [**]School Channel Creditworthy Law Loans,
[**]%;
16.
with respect to Bank of America
Private Loan [**] School Channel Credit-ready Graduate Loans,
[**]%;
17.
with respect to Bank of America
Private Loan [**] School Channel Credit-ready Law Loans, [**]%;
and
18.
with respect to Bank of America
Private Loan [**] School Channel Credit-ready Business Loans,
[**]%.
8
2.04.04
Administrative Costs
In addition, the Minimum Purchase
Price shall include reimbursement of any subsequent guaranty fees
due from Lender to TERI [**].
2.05. Failure of FMC
to Securitize.
In the event that: (a) FMC
fails to specify a Purchase Date and to consummate a Securitization
Transaction with respect to a Pool of Seasoned Loans [**], and
(b) Program Lender subsequently sells such a Pool in a
transaction that, if it had been conducted by a Purchaser Trust,
would constitute a Securitization Transaction, THEN FMC will
reimburse Program Lender for [**]. For purposes only of this
Section 2.05, the following terms have the following
meanings:
[**].
III.
Procedures and Conditions for
Transfer.
3.01. Conveyances of
Bank of America SC Conforming Loans; Conditions to
Purchase.
(a) On each Purchase
Date, upon execution and delivery of the related Pool Supplement,
Program Lender shall sell, transfer, assign, set over and otherwise
convey to FMC or the Purchaser Trust, without recourse, all right,
title and interest of Program Lender in and to:
(1)
The Seasoned Loans included in the
related Pool originated by Program Lender and all payments due or
to become due thereon;
(2)
Any proceeds with respect to the
Seasoned Loans originated by Program Lender included in such Pool
from recourse to TERI under the Loan Origination Agreement
regarding origination of Conforming Loans;
(3)
Any claims Program Lender may have
under the Servicing Agreement with respect to acts or omissions of
the Servicer affecting the Seasoned Loans being
purchased;
(4)
The proceeds of any and all of the
foregoing received after the Purchase Date or received prior
thereto and not credited against the Minimum Purchase Price as
computed on the Purchase Date (and, pursuant to Section 3.07,
the Purchaser Trust shall assume certain liabilities of Program
Lender thereunder);
(5)
All rights of Program Lender under
the Guaranty Agreement with respect to the loans in the
Pool.
(b) The obligation of
the Purchaser Trust to purchase the Seasoned Loans originated by
Program Lender on the related Purchase Date shall be subject to
satisfaction of the following conditions (each and all of which may
be waived by such Purchaser Trust, in whole or in part in its sole
discretion):
(1)
Program Lender shall have delivered
to the Purchaser Trust a duly authorized and executed Pool
Supplement;
(2)
Each of the representations and
warranties made by Program Lender pursuant to Section 5.02
with respect to the Seasoned Loans originated by Program Lender
included in such Pool shall be true and correct as of the related
Purchase Date;
(3)
The Loan Origination Agreement and
the Servicing Agreement shall be in full force and effect as of the
related Purchase Date and Program Lender and Servicer shall have
executed and delivered a Servicing Assignment and Servicer Consent
Letter;
9
(4)
Program Lender and TERI shall have
performed and observed the terms and conditions of this Agreement
and the Loan Origination Agreement and there shall not have
occurred a default under either the Loan Origination Agreement or
the Servicing Agreement;
(5)
Program Lender shall have complied
with the provisions of the Umbrella Agreement applicable to the
Seasoned Loans included in the Pool;
(6)
The loans to be purchased shall have
been originated and serviced in conformity with the Program
Guidelines and shall be covered by the Guaranty
Agreement;
(7)
The Agent pursuant to the Deposit
and Security Agreement, shall have transferred to the indenture
trustee in the Securitization Transaction the portion of the
Pledged Account and the Collateral specified in Section 4 of
the Deposit and Security Agreement;
(8)
If required by any other Lender
whose loans are included in the Securitization Transaction, the
Program Lender shall have executed and delivered a Co-Lender
Indemnification Agreement substantially in the form of
Exhibit A ;
(9)
Program Lender shall, at its own
expense, on or prior to the Purchase Date, indicate in computer
files relating to Seasoned Loans that the Seasoned Loans identified
in the related Pool Supplement have been sold to the Purchaser
Trust pursuant to this Agreement and such Pool
Supplement;
(10) Program Lender shall have executed and delivered
for filing a UCC-1 financing statement with respect to the Seasoned
Loans originated by Program Lender included in such Pool in the
appropriate office of the jurisdiction in which the chief executive
office of the Program Lender is located (or, in the event of a
change of law, Program Lender shall have taken, but at no
additional cost or expense to the Program Lender, such action as
may be reasonably advised by the Purchaser Trust);
(11) As of such Purchase Date: (i) Program
Lender was not insolvent and will not become insolvent as a result
of the transfer of Seasoned Loans on such Purchase Date,
(ii) Program Lender did not intend to incur or believe that it
would incur debts that would be beyond Program Lender’s
ability to pay as such debts matured, (iii) such transfer was
not made with actual intent to hinder, delay or defraud any Person,
and (iv) Program Lender was “Well Capitalized,” as
such term is defined by the Office of the Comptroller of the
Currency on the Purchase Date; and
(12) Program Lender shall have executed and delivered
an Indemnification Agreement substantially in the form of
Exhibit D attached hereto, provided ,
however , that an Indemnification Agreement shall not be
required if FMC executes and delivers to Program Lender a
certificate which states that no Offering Materials (as defined in
Exhibit D attached hereto) were distributed or provided
to any securities purchaser or prospective purchaser in connection
with the Securitization Transaction in question.
(c) The obligation of
Program Lender to sell the Seasoned Loans originated by Program
Lender included in the Pool on a related Purchase Date are subject
to satisfaction of the following conditions (each and all of which
may be waived by Program Lender in whole or in part, in its sole
discretion):
(1)
Purchaser Trust shall have delivered
to Program Lender a duly authorized and executed Pool
Supplement;
(2)
Purchaser Trust shall have paid the
Minimum Purchase Price to Program Lender by wire transfer of
immediately available funds within twenty-four (24) hours after the
Purchase Date (such Minimum Purchase Price shall be based on the
best information available from
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the Servicer as of the Purchase
Date; no later than thirty (30) days following the Purchase Date,
the Purchaser Trust shall recalculate the Minimum Purchase Price to
reflect adjustments for transactions (including, without
limitation, additional accrued interest and payments received), and
whichever party is deemed to owe the other such adjustment shall
deliver such adjustment to such other party, by wire transfer of
immediately available funds);
(3)
FMC shall have complied with the
terms of the Umbrella Agreement applicable to the Seasoned Loans
included in the Pool and no default of FMC under the Umbrella
Agreement relating to any Seasoned Loans shall have materially
impaired the rights of the Program Lender in connection with the
purchase and sale of the Pool to be sold on the Purchase
Date;
(4)
FMC and Purchaser Trust shall have
executed and delivered an Indemnification Agreement substantially
in the form of Exhibit D attached hereto,
provided , however , that an Indemnification
Agreement shall not be required if FMC executes and delivers to
Program Lender a certificate which states that no Offering
Materials (as defined in Exhibit D attached hereto)
were distributed or provided to any securities purchaser or
prospective purchaser in connection with the Securitization
Transaction in question.
(5)
In the event the subject Pool
contains loans originated by persons and entities other than
Program Lender (to the extent permitted under the Umbrella
Agreement), each such person and entity shall have delivered to
Program Lender a Co-Lender Indemnification Agreement;
(6)
If the trustee or other fiduciary
under the related Trust Indenture is not U.S. Bank, N.A., Program
Lender shall have approved such trustee or fiduciary, with such
approval not to have been unreasonably withheld; and
(7)
Program Lender shall have received
an opinion of Thacher, Proffitt & Wood, or other
securities counsel to the Purchaser Trust and FMC, addressed to
Program Lender and satisfactory to Program Lender in form and
substance. Such opinion shall, with respect to any securities
issued by the Purchaser Trust, state that nothing has come to the
attention of such counsel that would lead it to believe that the
Offering Materials (as defined in the Indemnification Agreement
attached hereto as Exhibit D ) in connection with the
matters described therein contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading; provided , however , that Thacher,
Proffitt & Wood may except the
“BOA Information” (as defined in
Exhibit D attached hereto) from the scope of its
opinion, and further provided , however , that
such opinion shall not be required if FMC executes and delivers to
Program Lender a certificate which states that no Offering
Materials (as defined in Exhibit D attached hereto)
were distributed or provided to any securities purchaser or
prospective purchaser in connection with the Securitization
Transaction in question.
3.02. Delivery of
Documents.
On the Purchase Date, Program Lender
shall deliver to the Servicer, as agent for the Purchaser Trust
and/or to the trustee of the Trust Indenture, each Bank of America
SC Note originated by Program Lender included in the Pool and the
related Origination Records. If a Co-Lender Indemnification
Agreement is required as a condition of Program Lender’s
obligations under Section 3.01(c)(4) hereof, Program
Lender shall execute and deliver a Co-Lender Indemnification
Agreement to each lender selling Bank of America SC Conforming
Loans in the Securitization Transaction.
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3.03. Confirmation
of Representations and Warranties.
In each Pool Supplement, Program
Lender shall confirm its representations and warranties contained
in Section 5.02 hereof.
3.04. Rights
Transferred.
The transfer of funds pursuant to
Section 2.04 hereof shall constitute, and the delivery to FMC,
or its designated Purchaser Trust of each Pool Supplement shall
evidence, a sale and assignment to FMC or the Purchaser Trust of
the related Seasoned Loans and of all of Program Lender’s
interest in such Seasoned Loans. As assignee of such Seasoned
Loans, FMC or the Purchaser Trust shall receive: (i) interest
on such Seasoned Loans from and after the Purchase Date, and
(ii) any and all other payments and recoveries received by the
Servicer or Program Lender from the borrowers and cosigners of such
Seasoned Loans, or others pursuant to, or in respect of, such
Seasoned Loans from and after the Purchase Date, and all proceeds
thereof.
3.05. Subsequent
Receipts.
In the event that Program Lender
shall receive, subsequent to any such assignment, any amounts
whatsoever in respect to the Bank of America SC Conforming Loans so
assigned in the nature of those described in Section 3.04
above, such amounts shall be held by Program Lender in trust for
FMC or the Purchaser Trust to which it has sold the Notes, and the
Program Lender shall promptly deliver such amounts to the trustee
under the Trust Indenture.
3.06. Assignment of
Origination Rights.
Program Lender shall insure that
Program Lender’s rights under the Servicing Agreement and the
Loan Origination Agreement with respect to the Seasoned Loans in
each Pool shall be transferred to FMC or the Purchaser Trust by
execution and delivery of a Servicing Assignment and Servicer
Consent Letter. Program Lender shall require TERI to complete any
loan origination services being performed for Program Lender under
the Loan Origination Agreement on the Purchase Date so that
complete Origination Records are ready for transfer to the
Purchaser Trust (or to Servicer on its behalf).
3.07. No Assumption
of Liability to Fund Bank of America SC Loan Notes.
By their purchase of Bank of America
SC Loan Notes, FMC, and all Purchaser Trusts, shall assume no
liability, responsibility or obligation with respect to any
payments which are due and owing, or which are, or may be alleged
to be due and owing, by Program Lender to any Participating
Institution or to any Bank of America SC Loan borrower by reason of
the Seasoned Loans originated by Program Lender included in the
Pool evidenced by the Bank of America SC Loan Notes. Program Lender
shall be solely responsible to fulfill its obligations under any
agreements it may have with Participating Institutions regarding
origination and funding of such Seasoned Loans. Notwithstanding the
foregoing, the Purchaser Trust shall assume from Program Lender any
liability to repurchase from TERI a defaulted Loan upon cure of the
default, with respect to any Loan that would be a Seasoned Loan but
for such default and purchase by TERI.
3.08 . Servicing and
Origination Costs.
Except as expressly set forth in the
definition of “Minimum Purchase Price,” Program Lender
shall be solely responsible for and shall pay all costs due to any
third party from Program Lender (including, without limitation,
amounts due to Servicer) with respect to origination of Bank of
America SC Conforming Loans and with respect to loan servicing of
Bank of America SC Conforming Loans incurred prior to purchase of a
Bank of America SC Conforming Loan hereunder. FMC shall be solely
responsible for and shall pay any obligations it has incurred in
connection with the Bank of America SC Conforming Loans.
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