2 - and related Loan documentation. “Loan” means an unsecured, closed-end consumer loan facilitated by Client and sold to Investors as a fractional loan. Loans under this Agreement before the Appointment Effective Date shall only include those...
[***] Confidential Treatment Requested Exhibit 10.2
Execution Version
FRACTIONAL LOANS BACKUP SERVICING AGREEMENT
This FRACTIONAL LOANS BACKUP SERVICING AGREEMENT (this “Agreement”), dated
as of July 27, 2017 (the “Effective Date”), is entered into by and between LendingClub Corporation, a
Delaware corporation (“Client”), Millennium Trust Company, LLC, an Illinois limited liability company
(“MTC”) and First Associates Loan Servicing, LLC, a Delaware limited liability company (“First
Associates”). Each of MTC and First Associates shall be referred to herein as a “Backup Servicer” and
collectively referred to as “Backup Servicers”).
WHEREAS, Client is in the business of facilitating loans through its online marketplace and
servicing such loans in its ordinary course of business;
WHEREAS, First Associates is engaged in the business of providing backup loan servicing;
WHEREAS, MTC is engaged in the business of providing certain asset custody solutions;
WHEREAS, Client wishes to engage Backup Servicers to perform certain backup servicing
duties on Loans in Client’s fractional loan channel program in accordance with the terms of this
Agreement, and assume the role of Successor Servicer (as defined below and as applicable to each of MTC
and First Associates) under the circumstances set forth in this Agreement; and
WHEREAS, Backup Servicers are willing to cooperate with each other as set forth herein,
perform their respective backup servicing duties specified herein and to assume the role of Successor
Servicer (as defined below and as applicable to each of MTC and First Associates) pursuant to the
conditions described herein.
NOW, THEREFORE, in consideration of the mutual agreements hereinafter set forth, and for
other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged,
Client hereby agree as follows:
1. Definitions. All capitalized terms not otherwise defined herein shall have the meanings set forth in the
applicable Servicing Agreement.
“Bankruptcy Event” shall mean the voluntary commencement by Client of liquidation
proceedings under 11 U.S. Code Chapter 7, as evidenced by a formal filing by Client in a United States
federal bankruptcy court.
“Business Day” means any day other than: (a) a Saturday or Sunday; (b) a legal or federal
holiday; and (c) a day on which banking and savings and loan institutions in San Francisco, California,
New York, New York, or the State of Utah are required or authorized by law or Regulatory Authority to
be closed for business.
“Collateral Package Items” shall mean, with respect to each Loan, the related Note Receivable and
each of the other items listed in Exhibit B attached hereto, which are maintained by Client as transferable
electronic records.
“Document Management Platform” shall mean eOriginal, Inc., or any other third party document
management platform holding Obligor Loan documentation.
“Investor” shall mean a purchaser and beneficial owner of a Loan, evidenced by promissory notes
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and related Loan documentation.
“Loan” means an unsecured, closed-end consumer loan facilitated by Client and sold to Investors
as a fractional loan. Loans under this Agreement before the Appointment Effective Date shall only
include those fractional consumer loans allocated, in Client’s sole discretion, to Backup Servicers as
platform backups, and identified in each respective Monthly Backup Servicing File provided by Client to
Backup Servicers, such Loan evidenced by a Note Receivable and identified by Client in the Collateral
Package Items. Loans under this Agreement on and after the Appointment Effective Date shall include all
fractional consumer loans in the last Monthly Backup Servicing File before the Appointment Effective
Date or all fractional consumer loans for which Client intends for Backup Servicers to become Successor
Servicers for, as evidenced by Client providing or making available to Backup Servicers the Collateral
Package Items concerning such fractional consumer loans on or after the Appointment Effective Date.
Any loans that have been sold by Client as part of a securitization shall not be considered a Loan for
purposes of this Agreement.
“Note Receivable” shall mean a promissory note executed electronically by an Obligor with respect
to a Loan and maintained as an electronic record by Client.
“Obligor” shall mean an obligor with respect to a Loan.
“Servicing Agreement” means Client’s applicable standard master loan servicing agreement, as
amended from time to time and filed as part of Client’s public securities filings. In the event that Backup
Servicers are appointed to become Successor Servicers and Client is no longer publicly filing its standard
master loan servicing agreement, the Servicing Agreement shall be the last publicly filed standard master
loan servicing agreement.
2. Obligations as Backup Servicers. From and after the date hereof until the Appointment Effective Date
(as defined below), Backup Servicers agree to perform the functions as set forth in this Section 2 with
respect to the Loans.
(a)
(i) Client shall deliver to First Associates, and First Associates shall accept, the following information
on a monthly basis for Loans that are to be allocated to Backup Servicers for a particular calendar
month: (A) the status of each Loan and its outstanding principal balance; (B) transaction information
posted to each Loan; and (C) current information regarding ownership of each Loan, payment
processing information including all information reasonably required to initiate ACH transfers from
Obligors’ bank accounts, and Obligor contact and account information with respect to each Loan
(collectively, the “FA Backup Servicing Information”).
(ii) Client shall deliver to MTC, and MTC shall accept, the following information on a monthly basis
for Loans that are to be allocated to Backup Servicers for a particular calendar month: (A) the status
of each Loan and its outstanding principal balance; (B) transaction information posted to each Loan;
and (C) current information regarding ownership of each Loan, including Investor contact and
account information with respect to each Loan, all information reasonably required to initiate ACH
transfers to Investors’ bank accounts, and information reasonably required to perform tax withholding
and reporting with respect to the Investors (collectively, the “MTC Backup Servicing Information”
and together with the FA Backup Servicing Information, the “Backup Servicing Information”).
(iii)The format and substance of the Backup Servicing Information and the means of providing the
Backup Servicing Information shall be mutually agreed to between Client and Backup Servicers.
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(b)
(i) Within five (5) Business Days of receipt of the FA Backup Servicing Information for any calendar
month, First Associates shall store the FA Backup Servicing Information via secure file transfer
protocol (SFTP) and send written confirmation of receipt and storage to Client. First Associates will
provide Client with a certificate stating that the complete set of FA Backup Servicing Information has
been received for such month (the “FA Monthly Backup Servicing File”), and that First Associates is
able to begin servicing of the Loans within thirty (30) days of receipt of such FA Monthly Backup
Servicing File.
(ii) Within five (5) Business Days of receipt of the MTC Backup Servicing Information for any
calendar month, MTC shall store the MTC Backup Servicing Information via secure file transfer
protocol (SFTP) and send written confirmation of receipt and storage to Client. MTC will provide
Client with a certificate stating that the complete set of MTC Backup Servicing Information has been
received for such month (the “MTC Monthly Backup Servicing File”), and that MTC is able to begin
servicing of the Investors within thirty (30) days of receipt of such MTC Monthly Backup Servicing
File.
(c) Backup Servicers shall, upon the execution of this Agreement, perform the one-time setup
activities set forth on Exhibit C.
(d) Backup Servicers shall, on an ongoing basis during the Term and after the Appointment Effective
Date and until this Agreement is terminated in accordance with the terms of herein, perform the
activities set forth on Exhibit D.
3. Appointment and Obligations as Successor Servicers.
(a) During the Term, upon written notice from an authorized representative of Client or a party
designated by Client pursuant to the form attached hereto as Exhibit E to each of First Associates and
MTC, First Associates and MTC shall be appointed to act as successor servicers (the “Successor
Servicers”) of the Loans and Investors, respectively. Client or an authorized representative of Client
shall give written notices of such appointment in the form attached hereto as Exhibit F upon one of
the following events (each, a “Triggering Event”): (i) Client’s inability to pay its debts and obligations
as they become due, as determined by Client in its sole discretion, (ii) any event rendering Client
unable to perform its loan servicing activities with respect to the Loans, as determined by Client in its
sole discretion, or (iii) a Bankruptcy Event. Upon the occurrence of a Triggering Event, Client shall
promptly give such written notice. Within three (3) business days of giving such written notice,
Client shall provide or make available for retrieval or download, to the extent not already done so, the
information necessary to enable First Associates to initiate automated clearing house (ACH) transfers
from Obligor bank accounts for all Loans and shall provide or make available for retrieval, to the
extent not already done so, all Collateral Package Items and Backup Servicing Information. Within
twenty (20) business days of Backup Servicers’ receipt of the foregoing documentation, Backup
Servicers shall assume their respective obligations and duties as set forth in the Servicing Agreement
and as set forth in this Agreement. The date on which Backup Servicers assume these obligations and
duties shall be the “Appointment Effective Date.” For the avoidance of doubt and notwithstanding
anything to the contrary herein, Backup Servicers shall have no duty to assume the obligations and
duties as set forth in the Servicing Agreement and as Successor Servicers under this Agreement until
Backup Servicers have received the documentation as set forth above. If requested by Client in
writing, Backup Servicers shall deliver at such time such written instruments of acceptance of
appointment as Successor Servicers. On and after the Appointment Effective Date, Backup Servicers
shall serve as Successor Servicers pursuant to the terms of this Agreement and the Servicing
Agreement.
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(b) Upon the appointment of Backup Servicers as Successor Servicers, Client shall:
(i) provide or make available for retrieval or download copies of all authentic Obligor Loan
documentation in its possession to First Associates;
(ii) use commercially reasonable efforts to assign at First Associate’s request, unless
otherwise prohibited by applicable law or contract, all collections services agreements
with third parties with respect to the Loans to First Associates in its capacity as Successor
Servicer.
(iii) direct Obligors and Investors to First Associates and MTC, as applicable, for servicing of
the Loans and Investors.
(c) Upon the appointment of Backup Servicers as Successor Servicers, First Associates and MTC
will perform the following activities:
(i) First Associates, in its role as a Successor Servicer, shall be ready, willing and able to
assume, and shall assume, all obligations and duties required of “Servicer” under the
Servicing Agreement, as such obligations and duties pertain to the collections of Obligor
payments, and conduct such activities as Successor Servicer under this Agreement and
“Servicer” under the Servicing Agreement using a standard of care and diligence
customary in the consumer loan servicing industry. Such obligations of First Associates
as Successor Servicer, include but are not limited to: (a) maintaining one bank account
which it will instruct Obligors to send payments due under the terms of each Loan; (b)
attempting to collect Obligor payments from the address listed in the applicable Obligor
Loan documentation; (c) maintaining a toll free number (staffed between normal business
hours during its regular business days) for Obligors and Investors to call with inquiries
with respect to the Loans, and responding to such inquiries; (d) responding to inquiries by
regulatory authorities with respect to the Loans; (e) investigating and maintaining
collection procedures for delinquencies; (f) processing payments provided by Obligors on
the Loans; (g) remitting payments made by Obligors on the Loans to MTC for final
disbursement to Investors in the Loans.
(ii) MTC, in its role as a Successor Servicer, shall be ready, willing and able to assume, and
shall assume, all obligations and duties required of “Servicer” under the Servicing
Agreement, as such obligations and duties pertain to the disbursement of Obligor
payments to Investors in the Loans, and shall exercise diligence, prudence and reasonable
care in carrying out its duties and obligations under this Agreement. Such obligations of
MTC as Successor Servicer, include but are not limited to: (a) setting up accounts for
each Investor holding a Loan being serviced by Successor Servicers hereunder; (b)
receiving remittances of Obligor payments from First Associates; (c) disbursing Obligor
payments, including principal, interest, liquidation proceeds and any other collections
from Loans required to be deposited to the applicable Investor accounts or transferred to
Investors pursuant to the Servicing Agreement; (d) maintaining a toll free number (staffed
between normal business hours during its regular business days) for Obligors and
Investors to call with inquiries with respect to the Loans, and responding to such
inquiries; (e) responding to inquiries by regulatory authorities with respect to the Loans
and (f) implementing tax reporting capabilities for Investors in accordance with
applicable law.
(iii) First Associates will remit funds from payments made by Obligors to MTC on a daily
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basis. Such remittances will be accompanied by a daily file identifying which Loans the
funds apply to. MTC shall identify which Investors funds should be ultimately disbursed
to.
(iv) First Associates and MTC shall cooperate and communicate with one another as
reasonably necessary in carrying out their obligations under clauses (i)-(iii) above. Each
of First Associates and MTC will use its reasonable best efforts to fulfill its obligations as
a Successor Servicer, as respectively described in clauses (i) and (ii) above. Each of First
Associates and MTC will use its reasonable best efforts to direct Obligors and Investors
to one another as is appropriate.
(d) Additional Obligations.
(i) Upon becoming Successor Servicer, First Associates shall enter into and maintain such
NACHA agreements and other arrangements necessary to ensure that First Associates
may initiate ACH transfers from Obligor bank accounts. First Associates shall maintain
one bank account which it will use for all ACH payments from Obligors. First Associates
hereby acknowledges that it has reviewed the form ACH authorization attached hereto as
Exhibit H and agrees that such ACH authorizations provided by Client to First Associates
are transferable to First Associates and would be valid upon such transfer or upon a
transfer in connection with an Annual Test in accordance with Section 7 of this
Agreement.
(ii) In the execution of its duties hereunder, Backup Servicers shall obtain and maintain all
appropriate licenses to conduct their business in compliance with all applicable legal and
regulatory requirements. Except as provided herein, however: (a) Backup Servicers shall
have no obligation to supervise, verify, monitor or administer the performance of Client
and shall have no liability for any action taken or omitted by Client and (b) Backup
Servicers shall have no liability for any losses incurred as a result of incomplete or
inaccurate data provided to Backup Servicers by Client or any other prior servicer, any
matter resulting from and relating to the origination of the Loans, errors made by prior
vendors or servicers, or ACH authorizations executed by Client or other parties. All
references to a “Purchaser Online Account” in the Servicing Agreement shall be
eliminated and Backup Servicers shall have no obligations with respect to any “Purchaser
Online Account.” Such elimination shall have no bearing on Backup Servicers’
responsibility to properly remit funds to purchasers or Investors of any Loans. Backup
Servicers acknowledge that the Servicing Agreement may be subject to change by Client
from time to time. Client shall promptly notify Backup Servicers of such changes.
(iii) First Associates and MTC each agree to maintain at their sole expense the following
insurance coverage during the term of this Agreement: (a) all insurance required by
federal, state, or local law and statute, including worker’s compensation insurance; (b)
employer’s general liability insurance of $2,000,000 per claim and in the aggregate; and
(c) errors & omissions insurance of $2,000,000 per claim and in the aggregate.
(iv) Client shall use commercially reasonable efforts to consult fully with MTC and First
Associates as may be necessary from time to time for MTC and First Associates to
perform or carry out its obligations hereunder, unless otherwise prohibited by law or
contract.
(v) Client hereby represents, warrants and covenants to Backup Service Providers that Client:
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A. is in compliance in all material respects with applicable provisions of the USA
PATRIOT Act, including: maintaining an anti-money laundering compliance
program (an “AML Program”) designed to detect and deter money-laundering
activities; maintaining and implementing policies and procedures designed to
screen and monitor Obligors and Investors against applicable regulatory and/or
governmental agency control lists (i.e. Office of Foreign Asset Control); and
obtaining an appropriate audit at least annually with respect to the AML Program
and such policies and procedures;
B. Client will not knowingly submit payment directions for any person or entity
identified in any list of known or suspected terrorists published by any United
States government agency (collectively, as such lists may be amended or
supplemented from time to time, the “Blocked Persons Lists”) including, without
limitation (a) the annex to Executive Order 13224 issued on September 23, 2001,
and (b) the Specially Designated Nationals List published by the Office of Foreign
Assets control;
C. upon the reasonable request of a Backup Servicer, which request shall be made no
more frequently than annually, Client shall provide a certificate, in a form
mutually agreeable to Client and such Backup Servicer (provided that a third party
attestation pertaining to such certificate will not be required), with respect to
compliance with the AML Program and such policies and procedures;
D. Client will cooperate with MTC with respect to any governmental inquiry or
investigation relating to MTC’s services provided pursuant to this Agreement; and
E. upon MTC’s determination that any Investor appears to match a person or entity
on the Blocked Persons Lists (a “Potential Match”), Client acknowledges and
agrees that MTC will not send payments to a Potential Match unless or until MTC
is able to confirm that the Potential Match is not on the Blocked Persons Lists.
4. Backup Servicer’s Fees. Fees to be paid to First Associates shall be as set forth in the attached Exhibit
A1. Fees to be paid to MTC shall be as set forth in the attached Exhibit A2.
5. Access to Records.
(a) Each of the Backup Servicers shall afford to Client and its employees, agents, accountants,
representatives, counsel and advisors, reasonable access during normal business hours to the books,
records, documents and other information concerning the Loans and the conduct and performance of
the Backup Servicers of their obligations hereunder.
6. Representations and Warranties. Each of the Backup Servicers hereby, separately and
individually, make the following representations and warranties as of the date hereof:
(a) Organization and Good Standing. First Associates is a limited liability company duly organized,
validly existing and in good standing under the laws of the state of Delaware. MTC is a limited
liability company duly organized, validly existing and in good standing under the laws of the state of
Illinois.
(b) Due Qualification. It is, and during the term of this Agreement shall be, duly qualified to do
business and, where necessary, in good standing as a foreign limited liability company (or is exempt
from such requirements)., and First Associates has obtained and will maintain all necessary licenses
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and approvals in each jurisdiction in which the servicing of the Loans requires such qualification
except where the failure to so qualify or obtain such licenses and approvals would not have a material
adverse effect on its ability to perform its obligations under this Agreement.
(c) Due Authorization. It has duly authorized, by all necessary action on its part, the execution and
delivery of this Agreement and the consummation of the transactions provided for or contemplated by
this Agreement.
(d) No Conflict. Its execution and delivery of this Agreement, its performance of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof applicable to it will not conflict
with, result in any breach of any of the material terms and provisions of, or constitute (with or without
notice or lapse of time or both) a material default under, any material indenture, contract, agreement,
mortgage, deed of trust or other instrument to which it is a party or by which it or its properties are
bound.
(e) No Violation. Its execution and delivery of this Agreement, its performance of the transactions
contemplated by this Agreement and its fulfillment of the terms hereof applicable to it will not conflict
with or violate any law applicable to it.
(f) No Proceedings. There are no proceedings pending or, to the best of its knowledge, threatened or
investigations pending or threatened against it before or by any governmental authority (i)
asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement, (iii) seeking any determination or ruling that would
reasonably be expected to materially and adversely affect its performance of its obligations under this
Agreement or (iv) seeking any determination or ruling that would materially and adversely affect the
validity or enforceability of this Agreement. If such a proceeding is initiated against Backup Servicer
during the Term, Backup Servicer shall promptly notify Client of such proceeding.
(g) All Consents Required. All material authorizations, consents, orders, approvals, licenses or other
actions of any governmental authority required to be obtained or effected by it in connection with its
execution and delivery of this Agreement, its performance of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof applicable to it have been duly obtained or effected
and are in full force and effect.
(h) Enforceability. This Agreement constitutes its legal, valid and binding obligation, enforceable
against it in accordance with the terms hereof, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereinafter in effect
affecting the enforcement of creditors’ rights and except as such enforceability may be limited by
general principles of equity (whether considered in a proceeding at law or in equity).
(i) Preservation of Security Interests. First Associates will defend the Loans against all persons,
claims, and demands whatsoever. First Associates shall not assign, sell, pledge, or exchange, or in any
way encumber or otherwise dispose of the Loans, except as expressly permitted under this Agreement.
(j) No Ownership Interest. Except as set forth in this Agreement, it does not have any ownership or
other interest in the underlying assets, payment streams, equipment, legal documents, or other
tangible or intangible assets of the Loans.
(k) Compliance with Laws. It has complied, and at all times during the term of this Agreement shall
comply, with all applicable federal, state and local laws, regulations and rules (“Applicable Law”). It is
responsible for (i) monitoring, interpreting and complying with Applicable Law, (ii) determining the
particular actions, disclosures, notices, formulas, calculations, and procedures required to ensure the
services provided under this Agreement are provided in compliance with Applicable Law, and (iii)
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maintaining an ongoing program for compliance with Applicable Law.
(l) FCPA. It is aware of and familiar with the provisions of the Foreign Corrupt Practices Act of 1977,
as amended (the “FCPA”) and will act in compliance with and take no action and make no payment in
violation of, or which might cause it or Servicer and each of their respective directors, officers,
employees, or agents to be in violation of the FCPA.
(m) Audit Report and Audit Rights. During the term of this Agreement, each of the Backup Servicers
shall have an audit conducted by a reputable third-party accounting firm regularly servicing the books
and records of such party or nationally-recognized independent third-party audit firm, that describes
such party’s security and control policies and procedures and is in the form as described in the then-
current Statement on Standards for Attestation Engagements 16 Report (the “SSAE 16 Report”),
which audit report shall at all times be no more than one (1) year old and shall certify that such party
is in compliance with the minimum servicing standards as described in the SSAE 16 Report. A copy
of such audit report has been delivered by each of the Backup Servicers to Client. Each of the Backup
Servicers shall deliver an updated SSAE 16 Report to Client on an annual basis. Each of the Backup
Servicers further agree that during the Term, upon Client's written request and at Client’s expense,
Client or Client's authorized representative shall be permitted to inspect and make copies of any and
all records relating to each Backup Servicer’s performance of its duties hereunder; provided that any
such inspection shall take place during regular business hours and Client provides Backup Servicers
with reasonable advance written notice.
7. Annual Testing. Once per calendar year in the month of August, Client shall have the right to conduct
a test (an “Annual Test”) of Backup Servicers’ abilities to assume their responsibilities as Successor
Servicers. The Annual Test will consist of (i) a temporary test transfer of Obligor loan documentation
for a sample of one hundred (100) Loans to Backup Servicers and (ii) a demonstration by each of
Backup Servicers of their ability to successfully load such sample of Loans onto their systems. Client
and each of the Backup Servicers shall agree on the date of the Annual Test no fewer than thirty (30)
days prior to conducting an Annual Test and any testing activities shall take place during regular
business hours. The parties shall work together to ensure that the Annual Test is conducted in a
reasonable, efficient and timely manner. Upon the conclusion of the Annual Test, each of the Backup
Servicers shall permanently delete or transfer back to Client all Obligor Loan documentation that was
transferred for purposes of the Annual Test.
8. Online Capabilities for Borrowers. Within sixty (60) days of becoming and assuming the
responsibilities of Successor Servicer, First Associates shall allow Obligors with outstanding Loans to
securely log in to a website maintained by First Associates to view, at a minimum, their outstanding
loan balances, Obligor Loan statements, interest rate, current amount due or overdue and date due.
Such website will also allow Obligors the ability to securely make payments to their loans online.
9. Online Capabilities for Investors. Within sixty (60) days of becoming and assuming the
responsibilities of Successor Servicer, MTC shall allow Investors in Loans to securely log into a
website maintained by MTC to view, at a minimum, their current investments in Loans and details on
each of their investments including interest rates, due dates and outstanding loan balances. Such
website will also allow Investors the ability to change their bank accounts information for
disbursements and address.
10. Background Checks and Verifications. Prior to any of Backup Servicers’ employees, agents,
representatives, or consultants (“Backup Servicer Personnel”) performing Backup Servicers’
obligations and duties under this Agreement, each of the Backup Servicers shall provide Client with
copies of its policies and procedures for the performance of criminal background checks on Backup
Servicer Personnel and compliance with all applicable immigration and employment laws. Each of
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the Backup Servicers hereby represents, warrants and covenants to Client that it is in material
compliance with such policies and procedures.
11. Business Continuity Plans and Disaster Recovery Plans. Each of the Backup Servicers agree to
maintain a written business continuity plan and a written disaster recovery plan. Each of the Backup
Servicers will update the business continuity plan and disaster recovery plan at least annually. Upon
request by Client, each of the Backup Servicers will provide Client with a description of such party’s
business continuity plan and disaster recovery plan procedures as they relate to the recovery and
resumption of its performance of its obligations under this Agreement.
12. Initial and Ongoing Due Diligence. The existence and terms of this Agreement and any information
shared among the parties hereto in connection with this Agreement shall be considered Confidential
Information (as defined in Exhibit G hereto) of each party, provided that Client may (i) in accordance
with its risk management policies and procedures, furnish a copy of this Agreement to WebBank (and
any successor party thereto or other originating bank); (ii) furnish a copy of this Agreement to the
holder of an accountholder’s debt following a written request by such holder and (iii) include this
Agreement in its public filings, provided that any terms concerning pricing and fees will be redacted.
13. Ownership and Use of Client Information. Backup Servicers agree that Client is, and shall be the sole
and exclusive owner of all right, title and interest in and to any information, documents, work product
and materials (including, but not limited to Backup Servicing Information and Collateral Package
Items) provided by Client to Backup Servicers pursuant to this Agreement, including all intellectual
property rights therein.
14. Restrictions on Use of Client Information. Backup Servicers agree to not use any information,
documents, work product and materials (including, but not limited to Backup Servicing Information
and Collateral Package Items) provided by Client to Backup Servicers under this Agreement for any
purpose outside the scope of this Agreement.
15. Indemnity by Client. Client agrees to defend, indemnify and hold Backup Servicers and their
respective affiliates, officers, directors, managers, members, employees or agents harmless against
any and all claims, losses, penalties, fines, forfeitures, legal fees and related costs, judgments, and any
other costs, fees, and expenses (collectively, “Losses”) incurred by Backup Servicers and arising as
a result of (i) the breach of this Agreement by Client, (ii) Client’s failure to comply in all material
respects with requirements of applicable federal, state and local laws and regulations, in performing
its obligations hereunder or in connection with the Loans or the Investors, (iii) the gross negligence or
willful misconduct of, or action taken in bad faith by, Client or (iv) any failure of the representations
and warranties made by Client hereunder or in connection herewith to be true and correct in all
material respects when made. The indemnities in this Section 15 shall survive the termination of this
Agreement or the removal or resignation of either Backup Servicer.
16. Limitation of Liability and Indemnification by Backup Servicers.
(a) In conjunction with Backup Servicers’ obligations hereunder, Backup Servicers are authorized to
accept and rely on all the accounting, records and work of Client. The degree of examination of such
accounting, records, and work which Backup Servicers reasonably deem necessary to complete any
conversion and portfolio transfer in connection with Backup Servicers becoming Successor Servicers
shall not be construed as a representation by Backup Servicers of the accuracy of such accounting,
records, and work.
(b) Each of Backup Servicers shall defend, indemnify and hold Client and its affiliates, beneficiaries,
trustees, members, managers, officers, employees, representatives, directors and agents harmless
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against any and all Losses incurred by Client and arising as a direct result of (i) the gross negligence
or willful misconduct of, or action taken in bad faith by, such Backup Servicer, (ii) such Backup
Servicer’s failure to comply in all material respects with requirements of applicable federal, state and
local laws and regulations, in performing its obligations hereunder, (iii) the breach of this Agreement
by such Backup Servicer, or (iv) any failure of the representations and warranties made by such
Backup Servicer hereunder or in connection herewith to be true and correct when made. Each
Backup Servicer and any of its members, managers, officers, employees or agents may rely in good
faith on any document of any kind prima facie properly executed and submitted by any person
respecting any matters arising hereunder. Neither party will be under any obligation to appear in,
prosecute or defend any legal action which is not incidental to its responsibilities hereunder and that in
its reasonable opinion may involve it in any expense or liability to be incurred under this Agreement.
The indemnities in this Section 16(b) shall survive the removal or resignation of either Backup
Servicer.
(c) Except for the obligations undertaken by Backup Servicers in this Agreement, Backup Servicers
will have no obligation to take any action, or to perform any of the duties of Client until such time as
Backup Servicer has become a Successor Servicer.
(d) Backup Servicers offer no representations concerning, and shall have no liability hereunder with
respect to, the collectability, enforceability or other characteristics of the Loans. The parties shall have
no responsibility and shall not be in default hereunder nor incur any liability for any failure, error,
malfunction or any delay in carrying out any of its duties under this Agreement if any such failure or
delay results from acts of God, war or terrorism, insurrection, strikes, stoppages of labor, power or
equipment failure or malfunction (including that of any common carrier or transmission line), loss or
malfunction of communications or computer (hardware or software) services, emergency conditions,
tornado, flood, fire, earthquake or similar event, adverse weather conditions or any other any cause or
circumstances, directly or indirectly, beyond Backup Servicers’ control or for information prepared or
supplied by any party other than the Backup Servicers as contemplated hereunder or the failure of any
such person to prepare or provide such information.
(e) EXCEPT AS EXPRESSLY SET FORTH IN SECTION 6 OF THIS AGREEMENT,
THERE ARE NO WARRANTIES MADE BY ANY BACKUP SERVICER HEREUNDER.
NOTWITHSTANDING ANYTHING IN THIS AGREEMENT TO THE CONTRARY, IN NO
EVENT SHALL BACKUP SERVICER OR CLIENT BE LIABLE TO THE OTHER FOR
ANY CONSEQUENTIAL, PUNITIVE, INCIDENTAL OR SPECIAL DAMAGES
INCLUDING, BUT NOT LIMITED TO DAMAGES FOR LOSS OF CURRENCY, FUNDS,
DATA, PROFITS OR GOODWILL, REGARDLESS OF WHETHER ANY BACKUP
SERVICER OR CLIENT HAS BEEN ADVISED OF THE LIKELIHOOD OF SUCH LOSS
OR DAMAGE AND REGARDLESS OF THE FORM OF ACTION.
17. Term. This Agreement shall commence as of the Effective Date and will continue for a period of two
(2) years after the Effective Date (the “Initial Term”). The Initial Term may be extended for one (1)
additional year upon mutual written agreement between the parties (the “Term Extension”). Upon
expiration of the Term Extension, this Agreement shall be automatically renewed and shall continue in
full force and effect until terminated as provided in Section 18. Notwithstanding the foregoing, this
Agreement shall not expire pursuant to the terms of this Section 17 after the Appointment Effective
Date and Backup Servicer has assumed its duties as Successor Servicer. After the Appointment
Effective Date, this Agreement shall only terminate once all Loans are fully paid and distributed in
accordance with this Agreement and the Servicing Agreement, fully charged off or otherwise
completely liquidated.
18. Termination.
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(a) Before the Appointment Effective Date, the parties may terminate this Agreement as follows:
(i) Client may terminate this Agreement (i) upon written notice to Backup Servicers if either
Backup Servicer commits a material breach of this Agreement, which breach has not been cured
within thirty (30) days of written notice of said breach being sent to such Backup Servicer, (ii)
upon the occurrence of the gross negligence or willful misconduct of either Backup Servicer, or
(iii) at any other time, with or without cause, upon ninety (90) days advance written notice to
Backup Servicers.
(ii) Client may terminate this Agreement for convenience during the Initial Term or the
Term Extension, if applicable, by providing Backup Servicers with thirty (30) calendar days’ prior
written notice of its intention to terminate this Agreement. Backup Servicers shall continue to
provide the services and shall be compensated per the terms of this Agreement during such thirty
(30) day period.
(iii) Following the expiration of the Initial Term or the Term Extension, if applicable, Client
may terminate this Agreement for convenience by providing Backup Servicers with sixty (60)
calendar days’ prior written notice of its intention to terminate this Agreement. Backup Servicers
shall continue to provide the services and shall be compensated per the terms of this Agreement
during such sixty (60) day period.
(iv) Following the expiration of the Initial Term or the Term Extension, if applicable, either
Backup Servicer may terminate this Agreement for convenience by providing the other parties
with one hundred twenty (120) calendar days’ prior written notice of its intention to terminate this
Agreement. Backup Servicers shall continue to provide the services and shall be compensated
per the terms of this agreement during such one hundred twenty (120) day period.
(b) Before the Appointment Effective Date, either Backup Servicer may terminate this Agreement,
by written notice to the other parties hereto, if it does not receive any payment required by a previously
submitted invoice, to be made to it by Client under the terms of this Agreement, which failure continues
unremedied for a period of thirty (30) days after written notice of such failure shall have been given to
Client.
(c) This Agreement will be automatically and immediately terminated upon the occurrence of any of
the following conditions:
(i) the entry with respect to either Backup Servicer of a decree or order for relief by a court or
agency or supervisory authority having jurisdiction under any present or future federal or state
bankruptcy, insolvency or similar law;
(ii) a conservator, receiver or liquidator is appointed with respect to either Backup Servicer in
any bankruptcy, insolvency, readjustment of debt, marshaling of assets and liabilities or similar
proceedings; or
(iii) Either Backup Servicer is unable to pay its debts generally as they become due, or files a
petition to take advantage of any applicable bankruptcy, insolvency or reorganization statute.
19. Backup Servicer Not to Resign. Backup Servicers shall not resign from the obligations and duties
hereby imposed on it except by mutual written consent of both Backup Servicers and Client or upon
the determination that its duties hereunder are no longer permissible under Applicable Law. Any such
determination permitting the resignation of a Backup Servicer must be in the reasonable
determination of such Backup Servicer and must be accompanied by a certificate of an authorized
officer of such Backup Servicer and an opinion of outside counsel to such Backup Servicer
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reasonably acceptable to Client certifying as to the basis of such impermissibility under Applicable
Law.
20. Confidential Information. Backup Servicers will preserve the confidentiality of any non-public
information obtained by it in connection with its performance of its responsibilities hereunder;
provided, however, that nothing herein shall prevent a Backup Servicer from disclosing such
information to (a) such Backup Servicer’s managers, officers, members, employees, agents,
subservicers and professional consultants in connection with such Backup Servicer’s obligations
under this Agreement, provided that such persons are informed of the confidential nature of such
information and instructed to keep such information confidential (provided that, in any event, such
Backup Servicer shall be responsible for any breach of this Agreement by such parties), (b) any
federal or state regulatory agency having jurisdiction over such Backup Servicer, (c) any federal or
state regulatory agency or governmental authority to which such disclosure is required (1) to effect
compliance with any law, rule, regulation or order applicable to such Backup Servicer, (2) in response
to any subpoena or legal process, (3) in connection with any litigation or adversary proceedings to
which such Backup Servicer or any other party hereto is a party, or (4) as required to execute and
administer this Agreement, (d) to the extent such information becomes public through no act or fault of
such Backup Servicer or (e) to each other to allow each Backup Servicer to carry out their duties
under this Agreement. In the case of any disclosure permitted by clause (b) or (c), such Backup
Servicer shall use commercially reasonable efforts to (x) provide Client with advance notice of any
such disclosure and (y) cooperate with Client in Client’s efforts to limit the extent or effect of any
such disclosure. To the extent that any information provided to either Backup Servicer in connection
with this Agreement meets the definition of “non-public personal information” as that term is defined
in Title V of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act, 15 U.S.C. Section 6801 et seq. (the “GLB Act”) and/or is
subject to protection under any federal or state statute, rule, regulation or guideline relating to privacy
(including, but not limited to, the GLB Act and each federal or state rule, regulation or guideline
implementing requirements of that statute) (“NPI Rules”), Backup Servicers shall treat such
information as confidential and in accordance with the terms of the GLB Act and the NPI Rules,
regulations and guidelines implementing requirements thereof and the exchange, transfer and storage
of such information shall be subject to the terms of Exhibit G attached hereto. This Section 20 shall
survive the termination of this Agreement or the removal or resignation of either Backup Servicer.
21. Counterparts. This Agreement may be executed simultaneously in any number of counterparts. Each
counterpart shall be deemed to be an original, and all such counterparts shall constitute one and the
same instrument. The parties agree that this Agreement and signature pages may be transmitted
between them by facsimile or by electronic mail and that faxed and PDF signatures may constitute
original signatures and that a faxed or PDF signature page containing the signature (faxed, PDF or
original) is binding upon the parties.
22. Subcontracting. If either Backup Servicer outsources any activities in the delivery of services under
this Agreement to any suppliers (subcontractors), such Backup Servicer shall remain fully liable and
responsible for the work to be performed by its subcontractors and shall be responsible for compliance
and management by such subcontractors with this Agreement. Notwithstanding the foregoing, Backup
Servicers each agree that all of Client’s data (including, but not limited to Confidential Information and
Obligor Loan documentation) shall reside in the United States.
23. Governing Law; Jurisdiction.
(a) THIS AGREEMENT SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND
ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF CALIFORNIA
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THEREOF.
(b) EACH PARTY IRREVOCABLY AND UNCONDITIONALLY SUBMITS, FOR ITSELF AND
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ITS PROPERTY, TO THE FOLLOWING PROVISIONS OF THIS SECTION 23(b):
(i) EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS,
FOR ITSELF AND ITS PROPERTY, TO THE EXCLUSIVE JURISDICTION OF ANY
CALIFORNIA STATE COURT OR FEDERAL COURT OF THE UNITED STATES
OF AMERICA SITTING IN THE STATE OF CALIFORNIA, AND ANY APPELLATE
COURT THEREOF, IN ANY ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT, OR FOR RECOGNITION OR ENFORCEMENT
OF ANY JUDGMENT, AND EACH OF THE PARTIES HEREBY IRREVOCABLY
AND UNCONDITIONALLY AGREES THAT, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, ALL CLAIMS IN RESPECT OF ANY SUCH ACTION OR
PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH STATE OR, TO
THE EXTENT PERMITTED BY LAW, IN SUCH FEDERAL COURT. EACH OF THE
PARTIES HERETO AGREES THAT A FINAL JUDGMENT IN ANY SUCH ACTION
OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER
MANNER PROVIDED BY LAW.
(ii) EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO
THE FULLEST EXTENT IT MAY LEGALLY AND EFFECTIVELY DO SO, ANY
OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR
RELATING TO THIS AGREEMENT IN ANY STATE OR FEDERAL COURT
SITTING IN THE STATE OF CALIFORNIA. EACH OF THE PARTIES HERETO
HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY
LAW, THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE
OF SUCH ACTION OR PROCEEDING IN ANY SUCH COURT.
(iii) EACH PARTY HEREBY IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY
JURY IN ANY ACTION OR PROCEEDING (I) TO ENFORCE OR DEFEND ANY
RIGHTS UNDER OR IN CONNECTION WITH THIS AGREEMENT, OR (II)
ARISING FROM ANY DISPUTE OR CONTROVERSY IN CONNECTION WITH OR
RELATED TO THIS AGREEMENT AND AGREES THAT ANY SUCH ACTION OR
COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A
JURY. THIS PROVISION IS A MATERIAL INDUCEMENT FOR CLIENT
ENTERING IN TO THIS AGREEMENT.
(iv) EACH PARTY HERETO IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO IT AT
ITS ADDRESS SET FORTH IN SECTION 25 HEREOF.
24. Waiver. No term or provision of this Agreement may be waived except by a formal written instrument
signed (and not by an email or series of emails) by duly authorized officers of the party against whom
such waiver is sought. The failure by Client to insist at any time upon strict compliance with this
agreement or with any of the terms of the agreement or any continued course of such conduct on its
part will not constitute or be considered a waiver by Client, as applicable, of any of its rights or
privileges. A waiver or consent, express or implied, of or to any breach or default by any party in the
performance by that party of its obligations with respect to the agreement is not a waiver or consent of
or to any other breach or default in the performance by that party of the same or any other obligations
of that party.
25. Notices. (a) Subject to Section 25(c) below, all notices and other communications provided for herein
shall be in writing and shall be delivered either by hand, by overnight courier service, by certified or
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registered mail, by telefacsimile or by email (in portable document format (“pdf”) or tagged image file
format (“TIFF”)) as follows:
(i) in the case of Client:
LendingClub Corporation
▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Legal Department
(ii) in the case of First Associates:
First Associates Loan Servicing, LLC
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Executive Vice President
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(iii) in the case of MTC:
Millennium Trust Company, LLC
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: General Counsel
Facsimile No.: (▇▇▇) ▇▇▇-▇▇▇▇
Email: ▇▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇▇▇.▇▇▇
(b) Any party hereto may change its address, facsimile number or email address for notices and other
communications hereunder by notice to all of the other parties hereto in accordance with Section 25(a)
above.
(c) All notices and other communications given to any party hereto in accordance with the provisions
of this Agreement shall be deemed to have been given (i) in the case of notices and other
communications delivered by hand or overnight courier service, upon actual receipt thereof, (ii) in the
case of notices and other communications delivered by certified or registered mail, upon the earlier of
actual delivery and the third Business Day after the date deposited in the U.S. mail with postage prepaid
and properly addressed, provided, that no notice or communication to either party shall be effective
until actually received by either party, (iii) in the case of notices and other communications delivered
by telefacsimile, upon receipt by the sender of an acknowledgment or transmission report generated by
the machine from which the telefacsimile was sent indicating that the telefacsimile was sent in its
entirety to the recipient’s telefacsimile number and (iv) in the case of notices and other communications
delivered by email, upon receipt by the sender of an acknowledgement from the intended recipient
(such as by the “return receipt requested” function, a return email or other written acknowledgement),
provided, that no notice or communication to either party shall be effective until receipt by the sender
of written confirmation of receipt affirmatively initiated by either party; provided, however, that in
each case, if a notice or other communication would be deemed to have been given in accordance with
the foregoing at any time other than during the recipient’s normal business hours on a Business Day for
such recipient, such notice or other communication shall be deemed given on the next succeeding
Business Day for such recipient; and provided, further, that no notice to either party shall be effective
until delivered by at least two, not one, of the methods described in clauses (i) through (iv) above.
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(d) Each party acknowledges and agrees that the use of electronic transmission in general, and email in
particular, is not necessarily secure and that there are risks associated with the use thereof, including
risks of interception, disclosure and abuse, and each indicates it assumes and accepts such risks by
hereby authorizing the use of electronic transmission.
26. Successors and Assigns. This Agreement shall inure to the benefit of the respective successors and
permitted assigns of each party and their respective permitted successors and assigns and the
obligations and liabilities assumed in this agreement by the parties hereto shall be binding upon their
respective successors and permitted assignees. This Agreement shall not be assigned, pledged or
hypothecated by any party without the prior written consent of the other parties, and any such
assignment, pledge or hypothecation shall be void without such prior written consent.
27. Further Assurances. The parties hereto agree to do and perform, from time to time, any and all acts
and to execute any and all further instruments required or reasonably requested by the other parties
hereto in order to effect more fully the purposes of this Agreement.
28. Integration. This Agreement contains the entire agreement of the parties with respect to the
engagement of the Backup Servicers with respect to the Loans and supersedes all prior negotiations,
agreements and understandings with respect thereto, both written and oral. This Agreement may not
be contradicted or supplemented by evidence of prior, contemporaneous or subsequent oral
agreements of the parties. There are no unwritten or oral agreements between the parties.
29. Independent Contractor. No Joint Venture or Partnership. Each of Backup Servicers are independent
contractors and shall perform the services called for under this Agreement as such, and not as the
agent, employee or servant of any other party hereto. Each party (including any of its respective
permitted successors and assigns) acknowledges and agrees that such party will not hold itself out as
an agent, partner or joint venture of any other party, and that this Agreement and the transactions
contemplated hereby are not intended and do not give rise now or in the future to an agency,
partnership, joint venture or other type of relationship between the parties.
30. Severability. All provisions of this Agreement are severable, and the unenforceability or invalidity of
any of the provisions of this Agreement shall not affect the validity or enforceability of the remaining
provisions of this Agreement. Should any part of this Agreement be held invalid or unenforceable in
any jurisdiction, the invalid or unenforceable portion or portions shall be removed (and no more) only
in that jurisdiction, and the remainder shall be enforced as fully as possible (removing the minimum
amount possible) in that jurisdiction. In lieu of such invalid or unenforceable provision, the parties
hereto will negotiate in good faith to add automatically as a part of this Agreement a legal, valid and
enforceable provision as similar in terms to such invalid or unenforceable provision as may be possible.
31. Survival. Sections 15, 16, 20, 23 and 25 through 33 shall survive the expiration, cancellation, or other
termination of this Agreement.
32. No Publicity. Except as set forth in Section 12 of this Agreement, Neither party shall issue or release
any announcement, statement, press release or other publicity or marketing materials relating to the
terms of this Agreement without the prior written consent of the other party.
33. Amendment. No modification, amendment, or waiver of any provision of, or consent required by, this
Agreement, nor any consent to any departure herefrom, shall be effective unless it is in writing and
signed by authorized officers of each of the parties hereto. Such modification, amendment, waiver or
consent shall be effective only in the specific instance and for the purpose for which given.
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(Signature page follows)
IN WITNESS WHEREOF, each of the parties has duly executed this Fractional Loans Backup
Servicing Agreement as of the date first written above.
FIRST ASSOCIATES: CLIENT:
First Associates Loan Servicing, LLC
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: CEO
LendingClub Corporation
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇
Title: COO
MTC:
Millennium Trust Company, LLC
By: /s/ ▇▇▇ ▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇
Title: Sr. Vice President
Signature Page to Fractional Loans Back-Up Servicing Agreement
Exhibit A1
First Associates Fees
Up and until the Appointment Effective Date, the following fees shall be payable by Client to First
Associates as follows:
For an outstanding Loan portfolio value of up to $[***] in principal balance, the ongoing
monthly fee to First Associates shall be $[***]. If the outstanding portfolio value for the
Loans exceeds $[***], the parties will negotiate pricing in good faith for such Loans in
excess of $[***].
After the Appointment Effective Date:
First Associates will charge an ongoing servicing fee of $[***] to be paid by the respective
Investors of each Loan, provided, that if First Associates is unable to charge the foregoing
respective amounts, First Associates shall not be required to perform the servicing activities
set forth in this Agreement with respect to such Loan. In such a circumstance, Client shall
not be held responsible and First Associates shall not be entitled to terminate or claim a
breach of this Agreement by Client on such basis.
The fees set forth herein are stated in U.S. Dollars, and all invoicing by First Associates and Client
payments hereunder shall also be in U.S. Dollars. First Associates shall submit an invoice to Client
for the following month’s fees, and Client shall pay outstanding invoices within thirty (30) days of
receipt or incur interest charges of [***] on any outstanding balance owed. In the event of a
servicing transfer and once First Associates assumes Successor Servicer duties, any applicable fees
hereunder will no longer accrue.
The terms of this Exhibit A1 shall be considered Client’s Confidential Information, as defined in
Exhibit G of the Agreement, and First Associates shall not be permitted to disclose any portion of
this Exhibit A1 to any third party (including but not limited to MTC).
Exhibit A2
MTC Fees
Up and until the Appointment Effective Date, the following fees shall be payable by Client to MTC
as follows:
For an outstanding Loan portfolio value of up to $[***] in principal balance, the ongoing
monthly fee to MTC shall be $[***]. If the outstanding portfolio value for the Loans
exceeds $[***], the parties will negotiate pricing in good faith for such Loans in excess of
$[***].
After the Appointment Effective Date:
MTC will charge an ongoing servicing fee of $[***] to be paid by the respective Investors
of each Loan, provided, that if MTC is unable to charge the foregoing respective amounts,
MTC shall not be required to perform the servicing activities set forth in this Agreement
with respect to such Loan. In such a circumstance, Client shall not be held responsible and
MTC shall not be entitled to terminate or claim a breach of this Agreement by Client on
such basis.
The fees set forth herein are stated in U.S. Dollars, and all invoicing by MTC and Client payments
hereunder shall also be in U.S. Dollars. MTC shall submit an invoice to Client for the following
month’s fees, and Client shall pay outstanding invoices within thirty (30) days of receipt or incur
interest charges of [***] on any outstanding balance owed. In the event of a servicing transfer and
once MTC assumes Successor Servicer duties, any applicable fees hereunder will no longer accrue.
The terms of this Exhibit A2 shall be considered Client’s Confidential Information, as defined in
Exhibit G of the Agreement, and MTC shall not be permitted to disclose any portion of this Exhibit
A2 to any third party (including but not limited to First Associates).
Exhibit B
Collateral Package Items
1. Loan Documents
• Borrower Agreement
• Credit Score Notice
2. Truth in Lending Disclosures (Estimated and Final)
3. Client Terms of Use and Consent to Electronic Transactions and Disclosures
4. Obligor Bank Account Verification & Debit Authorization
5. Promissory Note
6. Privacy Notice
7. Loan Agreement
EXHIBIT C
ONE TIME SETUP ACTIVITIES
First Associates shall perform the following one-time setup activities within a reasonable
time of execution of this Agreement:
Onsite review of Client’s loan servicing processes and procedures.
Review of Client’s loan servicing functions, including procedures for payment processing,
collections, cash management and information systems.
Work with Client to define electronic CSV data transfer files for comprehensive daily data
transfer.
Receive and archive all borrower ACH information and authorizations from Client as set
forth in the Agreement.
Receive from Client and onboard the initial comprehensive daily data transfer.
MTC shall perform the following one-time setup activities within a reasonable time of
execution of this Agreement:
Work with Client to define electronic CSV data transfer files for comprehensive daily data
transfer.
Receive from Client and onboard the initial comprehensive daily data transfer.
EXHIBIT D
BACKUP SERVICER ONGOING ACTIVITIES
Receive and onboard to data system comprehensive daily data transfer via CSV file.
Receive monthly servicer report from Client.
Reconcile and certify the monthly servicer report received from Client within five business
days of the receipt of the month-end data file and the monthly servicer reports.
In the event of any discrepancy between the month-end file provided by Client and the
related servicer report, promptly notify Client of such discrepancy.
Annual management meeting with Client to discuss items including, but not limited to
servicing practices, policies, changes to platform.
Direct any of Client’s Investors requesting verification of Obligor Loan documents to the
Document Management Platform, as applicable.
Receive and load Client’s Backup Servicing Information into Backup Servicers’ data
systems pursuant to Section 2(b) of the Agreement.
EXHIBIT E
NOTICE OF DESIGNATION
____________, 20__
[Address]
Dear [_________________]:
Reference is made to that certain Fractional Loans Backup Servicing Agreement, dated as
of [_____________], 2017 (the “Agreement”), entered into by and between LendingClub
Corporation, a Delaware corporation (“Client”), Millennium Trust Company, LLC, an Illinois
limited liability company (“MTC”) and First Associates Loan Servicing, LLC, a Delaware limited
liability company (“First Associates”). Capitalized terms used but not defined herein shall have the
meanings set forth in the Agreement.
Client hereby gives notice to [_____________] that [______________________]
(“Designee”) is designated to appoint [_________] as Successor Servicer of the Loans. Designee
may send the notice of appointment attached as Exhibit F to the Agreement. Client may revoke this
notice of designation solely by written notice to [_________] as specified in the Agreement,
received by [___________] prior to [____________]’s receipt of a notice of appointment attached
as Exhibit F to the Agreement sent by Designee.
Client has duly authorized, by all necessary action on its part, the execution and delivery of
this notice of designation, and the signatory on behalf of Client represents and warrants that such
signatory has been duly authorized to execute this notice of designation.
Please contact ____________________ to discuss.
Sincerely,
LendingClub Corporation
By:
Name:
Title:
Acknowledged:
DESIGNEE:
By:
Name:
Title:
EXHIBIT F
NOTICE OF APPOINTMENT
____________, 20__
[Address]
Dear [___________________]:
Reference is made to that certain Fractional Loans Backup Servicing Agreement, dated as
of [_____________], 2017 (the “Agreement”), entered into by and between LendingClub
Corporation, a Delaware corporation (“Client”), Millennium Trust Company, LLC, an Illinois
limited liability company (“MTC”) and First Associates Loan Servicing, LLC, a Delaware limited
liability company (“First Associates”). Capitalized terms used but not defined herein shall have the
meanings set forth in the Agreement.
Client hereby gives notice to [__________] that [___________] is appointed to act as
Successor Servicer of the Loans. Pursuant to the terms of Section 3(a) of the Agreement,
[_________] shall assume the obligations and duties as set forth in the Agreement and the Servicing
Agreement.
Client has duly authorized, by all necessary action on its part, the execution and delivery of
this notice of appointment, and the signatory on behalf of Client represents and warrants that such
signatory has been duly authorized to execute this notice of appointment.
Please contact ____________________ to discuss.
Sincerely,
LendingClub Corporation
By:
Name:
Title: _____________
EXHIBIT G
1. Definitions. For purposes of this Exhibit G:
“Authorized Employees” means Backup Servicer employees.
“Authorized Persons” means (i) Authorized Employees; and/or (ii) Backup Servicer’s contractors,
agents, outsourcers and auditors who have access to Confidential Information or Highly
Confidential Information, and who are bound in writing by confidentiality obligations sufficient to
protect Confidential Information or Highly Confidential Information in accordance with the terms
and conditions of this Agreement.
"Confidential Information" means all non-public or proprietary information treated as confidential
by a party that is not Highly Confidential Information, including but not limited to all information
concerning a party’s past, present and future business affairs including finances, products, services,
organizational structure, internal practices, forecasts and sales, corporate or departmental
organizational charts, internal policies and procedures, information contained in intranet web pages,
internal newsletters, training materials, business resumption plans, short-term business plans,
security plans and policies, non-public corporate financial reports, internal audit reports, vendor
contracts and bidding information. Confidential Information also includes all information that
would be considered “Material Nonpublic Information” under the Securities Act of 1934 and the
rules and regulations promulgated thereunder, (c) long-term business or marketing strategies or
plans, (d) information with respect to proposed acquisitions, divestitures or joint ventures, (e)
reports concerning significant exposures or risks, (f) security investigations or analyses, (g)
documents labeled “Privileged” and/or “Confidential”, (h) non-public legal opinions or work
product, (i) regulatory reports, (j) trade secrets, and (k) information with respect to a party’s
workforce such as salaries, bonuses, performance reviews and contact or identification information
"Disclosing Party" means a party that discloses Protected Information under this Agreement.
“Highly Confidential Information” means all information with respect to a party’s customers
(which, for the avoidance of doubt, with respect to Client, includes both borrowers and investors) or
prospective customers meeting the definition of “Nonpublic personal information” under the
▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and the rules and regulations promulgated thereunder (including, without
limitation, name, address, e-mail address, passwords, account numbers, personal financial
information, personal preferences, demographic data, marketing data, other identification data,
information that reflects use of or interaction with a party’s service including its websites and any
data otherwise submitted in the process of registering for a party’s services).
“Protected Information” means, collectively, Confidential Information and Highly Confidential
Information. Protected Information shall not include information that: (a) is already known to the
Receiving Party without restriction on use or disclosure prior to receipt of such information from
the Disclosing Party; (b) is or becomes generally known by the public other than by breach of this
Agreement by the Receiving Party; (c) is developed by the Receiving Party independently of, and
without reference to, any Protected Information of the Disclosing Party; or (d) is received by the
Receiving Party from a third party who is not under any obligation to the Disclosing Party to
maintain the confidentiality of such information.
"Receiving Party" means a party that receives or acquires Protected Information directly or
indirectly under this Agreement.
“Security Breach” means (i) any unauthorized access to or disclosure or use of Highly
Confidential Information under Backup Servicer’s control or in the possession of its Authorized
Employees that requires notification under any applicable law; or (ii) any audit that indicates that
the physical, technical, administrative or organizational safeguards put in place by Backup Servicer
(or any Authorized Employees) that relate to the protection of the security, confidentiality or
integrity of Highly Confidential Information are inadequate.
2. Standard of Care.
(a) Backup Servicer acknowledges and agrees that, in the course of its engagement by Client,
Backup Servicer may receive or have access to Highly Confidential Information. Backup Servicer
shall comply with the terms and conditions set forth in this Agreement in its collection, receipt,
access, transmission, storage, disposal, use and disclosure of such Highly Confidential Information
and be responsible for the unauthorized collection, receipt, transmission, access, storage, disposal,
use and disclosure of Highly Confidential Information under its control or in its possession by all
Authorized Employees. Backup Servicer shall be responsible for, and remain liable to, Client for
the actions and omissions of all Authorized Persons concerning the treatment of Highly
Confidential Information as if they were Backup Servicer’s own actions and omissions. Backup
Servicer shall require all its contractors, agents, outsourcers and auditors who have access to
Confidential Information or Highly Confidential Information to execute a written agreement
agreeing to comply with the terms and conditions of this Agreement relating to the treatment of
Highly Confidential Information.
(b) In the event of a conflict or inconsistency between this Section and the confidentiality sections
of this Agreement, the terms and conditions set forth in this Section shall govern and control.
(c) In recognition of the foregoing, Backup Servicer agrees and covenants that it shall: (i) keep and
maintain all Highly Confidential Information in strict confidence, using such degree of care as is
appropriate to avoid unauthorized access, use or disclosure; (ii) use and disclose Highly
Confidential Information solely and exclusively for the purposes for which the Highly Confidential
Information, or access to it, is provided pursuant to the terms and conditions of this Agreement, and
not use, sell, rent, transfer, distribute, or otherwise disclose or make available Highly Confidential
Information for Backup Servicer’s own purposes or for the benefit of anyone other than Client, in
each case, without Client’s prior written consent; and (iii) not directly disclose Highly Confidential
Information to any person other than its Authorized Persons with a need to access Highly
Confidential Information for the purposes of enabling Backup Servicer to perform its obligations
under this Agreement (each person other than an Authorized Person with a need to access Highly
Confidential Information, an “Unauthorized Third Party”), without express written consent from
Client unless and to the extent required by government authorities or as otherwise, to the extent
expressly required, by applicable law, in which case, Backup Servicer shall (A) notify Client before
such disclosure or as soon thereafter as reasonably possible; and (B) be responsible for and remain
liable to Client for the actions and omissions of such Unauthorized Third Party concerning the
treatment of such Highly Confidential Information as if they were Backup Servicer’s own actions
and omissions; and (C) require the Unauthorized Third Party to whom Backup Servicer grants
access to Highly Confidential Information to execute a written agreement agreeing to comply with
the terms and conditions of this Agreement relating to the treatment of Highly Confidential
Information.
3. Information Security.
(a) Backup Servicer represents and warrants that its collection, access, use, transmission, storage,
disposal and disclosure of Highly Confidential Information does and will comply with all
applicable federal, state, and relevant foreign privacy and data protection laws, as well as all other
applicable regulations and directives.
(b) Without limiting Backup Servicer’s obligations under Section 3(a), Backup Servicer shall
implement administrative, physical and technical safeguards to protect Highly Confidential
Information that are no less rigorous than accepted industry practices and shall ensure that all such
safeguards, including the manner in which Highly Confidential Information is collected, accessed,
used, transmitted, stored, processed, disposed of and disclosed, comply with applicable data
protection and privacy laws, as well as the terms and conditions of this Agreement.
(c) At a minimum, Backup Servicer’s safeguards for the protection of Highly Confidential
Information shall include: (i) limiting access of Highly Confidential Information to Authorized
Persons with a business need to know; (ii) securing business facilities, data centers, paper files,
servers, back-up systems and computing equipment, including, but not limited to, all company
owned mobile devices and other equipment with information storage capability; (iii) implementing
network, device, application, database and platform security controls consistent with industry
standards (e.g. SANS Information Security Policy Templates); (iv) securing information collection,
access, use, transmission, storage and disposal of Highly Confidential Information; (v)
implementing authentication and access controls to all systems containing Highly Confidential
Information; (vi) encrypting Highly Confidential Information stored on any company owned mobile
media including laptops, smartphones and tablets; (vii) encrypting Highly Confidential Information
transmitted over public or wireless networks; (viii) strictly segregating Highly Confidential
Information from information of Backup Servicer or its other customers so that Highly Confidential
Information is not commingled with any other types of information; (ix) implementing appropriate
personnel security and integrity procedures and practices, including, but not limited to, conducting
background checks consistent with applicable law; (x) providing appropriate privacy and
information security training to all Authorized Persons; (xi) maintaining comprehensive and
updated malware detection capabilities including anti-virus software; (xii) maintaining an incident
response program capable of detecting, responding and remediating security incidents upon
discovery; and (xiii) ensuring that test environments are not exposed to production data.
(d) During the term of each Authorized Person’s employment and/or engagement by Backup
Servicer, Backup Servicer shall at all times cause such Authorized Persons to abide strictly by
Backup Servicer’s obligations under this Agreement. Backup Servicer further agrees that it shall
maintain a disciplinary process in line with Backup Servicer’s company policies and procedures to
address any unauthorized access, use or disclosure of Highly Confidential Information by any of
Backup Servicer’s officers, partners, principals, employees, agents or contractors. Upon Client’s
written request, Backup Servicer shall promptly identify for Client in writing all Authorized
Persons as of the date of such request.
4. Security Breach Procedures.
(a) Backup Servicer shall: (i) provide Client with the name and contact information for an
employee of Backup Servicer who shall serve as Client’s primary security contact and shall be
available to assist Client 24 hours per day, 7 days per week as a contact in resolving obligations
associated with a Security Breach; (ii) notify Client of a Security Breach as soon as practicable, but
no later than 48 hours after Backup Servicer becomes aware of it; and (iii) notify Client of any
Security Breaches by e-mailing Client with a read receipt at ▇▇▇▇▇▇▇▇@▇▇▇▇▇▇▇▇▇▇▇.▇▇▇ and with a
copy by e-mail to Backup Servicer’s primary business contact within Client.
(b) Immediately following Backup Servicer’s notification to Client of a Security Breach, the parties
shall coordinate with each other to investigate the Security Breach. Backup Servicer agrees to fully
cooperate with Client in Client’s handling of the matter, including, without limitation: (i) assisting
with any investigation; (ii) providing Client with physical access to the facilities and operations
affected; (iii) facilitating interviews with Backup Servicer’s employees and others involved in the
matter; and (iv) making available all relevant records, logs, files, data reporting and other materials
required to comply with applicable law, regulation, industry standards or as otherwise reasonably
required by Client.
(c) Backup Servicer shall use best efforts to immediately remedy any Security Breach and prevent
any further Security Breach at Backup Servicer’s expense in accordance with applicable privacy
rights, laws, regulations and standards. Backup Servicer shall (i) reimburse Client for actual out of
pocket costs incurred by Client in responding to, and mitigating damages directly caused by, any
Security Breach, including all costs of notice and/or remediation pursuant to Section 4(d) and (ii)
upon Client’s request, provide to Client information on measures taken to prevent any further
Security Breach.
(d) Backup Servicer agrees to fully cooperate at its own expense with Client in any litigation or
other formal action deemed necessary by Client to protect its rights relating to the use, disclosure,
protection and maintenance of Highly Confidential Information in Backup Servicer’s control or
possession.
5. Oversight of Security Compliance. At least once per year, Backup Servicer shall conduct site
audits of the information technology and information security controls for all facilities used in
complying with its obligations under this Agreement. Upon Client’s request, to confirm Backup
Servicer’s compliance with this Agreement, as well as any applicable laws, regulations and industry
standards, Backup Servicer grants Client or, upon Client’s election, a third party on Client’s behalf,
permission to perform an assessment, audit, examination or review of all controls in Backup
Servicer’s physical and/or technical environment in relation to all Highly Confidential Information
being handled and/or services being provided to Client pursuant to this Agreement. Backup
Servicer shall fully cooperate with such assessment by providing access to knowledgeable
personnel, physical premises, documentation, infrastructure and application software that processes,
stores or transports Highly Confidential Information for Client pursuant to this Agreement. Upon
Client’s written request, Backup Servicer shall make available to Client for review all of the
following, as applicable: Backup Servicer’s latest Payment Card Industry (PCI) Certification
Report; SOC2 Report on Controls at a Service Organization Relevant to Security, Availability,
Processing Integrity, Confidentiality or Privacy; and any reports relating to its ISO/ICE 27001
certification. Client shall treat such audit reports as Backup Servicer’s Confidential Information
under this Agreement. Any exceptions noted on the SSAE report or other audit reports relating to
Highly Confidential Information will be promptly addressed with the development and
implementation of a corrective action plan by Backup Servicer’s management.
6. Return or Destruction of Confidential Information. At any time during the term of this
Agreement at the Client’s request or upon the termination or expiration of this Agreement for any
reason, Backup Servicer shall, and shall instruct all Authorized Persons to, promptly destroy all
copies, whether in written, electronic or other form or media, of Highly Confidential Information in
its possession or the possession of such Authorized Persons, or securely dispose of all such copies,
and certify in writing to the Client that such Highly Confidential Information has been returned to
Client or disposed of securely, except for information retained pursuant to Backup Servicer’s
document retention policies, which shall be retained subject to this Agreement. Backup Servicer
shall comply with all commercially reasonable directions provided by Client with respect to the
return or disposal of Highly Confidential Information.
EXHIBIT H
Making Loan Payments / Authorization for Automatic Payments
If your loan is funded, you hereby authorize LendingClub Corporation ("Lending Club"), as the
loan servicer on your loan from WebBank, and its successors and assigns, to initiate electronic
funds transfers from your designated account provided to Lending Club on the date of this
agreement for monthly repayments on your loan. EACH MONTH, THE DEBIT AMOUNT MAY
BE A RANGE OF PAYMENTS, WHICH WOULD INCLUDE YOUR MONTHLY PRINCIPAL
AND INTEREST, AND FEES, IF ANY. ANY FEES AUTHORIZED TO BE CHARGED ON
YOUR LOAN MAY BE COLLECTED USING ELECTRONIC FUNDS TRANSFERS
INITIATED BY US FROM YOUR DESIGNATED ACCOUNT.
With regard to payments made by automatic withdrawal, you have the right to receive notice of all
transfers that will vary in amount from one month to the next. Lending Club will provide electronic
notice of the upcoming transfer amount ten (10) calendar days ahead of the scheduled transfer. You
may stop payment of automatic withdrawals or revoke your prior authorization for automatic
withdrawals by notifying us at least three (3) banking days before the scheduled date of transfer. All
payments are to be applied first to the payment of all fees, expenses and other amounts due
(excluding principal and interest), then to accrued interest, and the balance on the account of
outstanding principal; provided, however, that after an Event of Default, payments will be applied
to your obligations as we determine in our sole discretion. You understand this authorization will
remain in effect until your loan is paid in full or you notify us or your financial institution of its
termination, taking into consideration the necessary time required by Lending Club and your
financial institution to implement the change.