Common use of Mandatory Repurchases Clause in Contracts

Mandatory Repurchases. (a) Upon discovery by a Responsible Officer of the Seller, the Purchaser (or the Collateral Manager on its behalf) or the Collateral Agent that a Loan was not an Eligible Loan on its Transfer Date (each such Loan, an “Ineligible Loan”) or that a Loan otherwise constitutes a Warranty Loan as a result of a breach of any representation or warranty of the Seller regarding such Loan, the party discovering the same shall give prompt written notice to the other party hereto or to the parties hereto (if the Collateral Agent is the party providing such notice), the Administrative Agent, the Collateral Agent and the Collateral Manager. Within ten (10) days of the earlier of its discovery or its receipt of notice of any such Ineligible Loan or Warranty Loan, the Seller shall (i) promptly cure such breach to the satisfaction of the Administrative Agent, (ii) repurchase the Loan by depositing in the Collection Account an amount equal to the Transfer Deposit Amount of such Loan or (iii) replace such Loan and substitute therefor one or more Loans in a Substitution satisfying the applicable provisions of Section 2.14 of the Loan Agreement. (b) The Seller shall bear all transaction costs incurred in connection with a repurchase or Substitution of Loans effected pursuant to this Agreement (including costs under the Loan Agreement).