--------------------------------------------------------------------------------

Exhibit 10.6

EXECUTION VERSION
 
CONFIDENTIAL TREATMENT REQUESTED
 
WEBBANK
 
and
 
PROSPER MARKETPLACE, INC.
 
SECOND AMENDED AND RESTATED
LOAN ACCOUNT PROGRAM AGREEMENT
 
Dated as of January 25, 2013
 
 
 

--------------------------------------------------------------------------------

 
 
SCHEDULES AND EXHIBITS
 

 
SCHEDULE 1
Definitions
       
SCHEDULE 7(b)(4)
Litigation
       
EXHIBIT A
The Program Website
       
EXHIBIT B
Credit Policy
       
EXHIBIT C
Form of Application
       
EXHIBIT D
Loan Account Documentation
       
EXHIBIT E
Sample Funding Statement
       
EXHIBIT F
Insurance Requirements
       
EXHIBIT G
Program Compliance Manual
       
EXHIBIT H
Third-Party Service Contractors
       
EXHIBIT I
Bank Secrecy Act Policy

 
 

--------------------------------------------------------------------------------

 
 
This SECOND AMENDED AND RESTATED LOAN ACCOUNT PROGRAM AGREEMENT (this
“Agreement”), dated as of January 25, 2013 (“Effective Date”), is made by and
between WEBBANK, a Utah-chartered industrial bank having its principal location
in Salt Lake City, Utah (“Bank”), and PROSPER MARKETPLACE, INC., a Delaware
corporation, having its principal location in San Francisco, California
(“Company”).
 
WHEREAS, Company is in the business of providing certain services necessary for
the origination of consumer installment loans;
 
WHEREAS, Bank is in the business of originating various types of consumer loans,
including installment loans;
 
WHEREAS, Bank and Company have entered into an Amended and Restated Loan Account
Program Agreement, dated as of September 14, 2010,  pursuant to which Bank
originates installment loans for qualifying consumers identified by Company, and
Company markets and provides an online interface and certain other operational
services in support of such loan program (the “Existing Program Agreement”); and
 
WHEREAS, effective as of the Effective Date, the Parties desire to amend and
restate the terms of the Existing Program Agreement on the terms and conditions
set forth herein.
 
NOW, THEREFORE, in consideration of the foregoing and the terms, conditions and
mutual covenants and agreements herein contained, and for good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
Bank and Company mutually agree as follows:
 
1.
Definitions; Effectiveness.

 
 
(a)
The terms used in this Agreement shall be defined as set forth in Schedule 1,
and the rules of construction set forth in Schedule 1 shall apply to this
Agreement.

 
 
(b)
This Agreement shall be effective as of the Effective Date and, as of the
Effective Date, shall supersede and replace the Existing Program
Agreement.  This Agreement shall apply to all Loan Accounts originated by Bank
during the term of this Agreement, beginning on the Effective Date.  Loans
originated on or after the Effective Date shall not be subject to the Existing
Program Agreement.

 
 
(c)
All Loan Accounts originated by Bank prior to the Effective Date shall be
governed by the terms of the Existing Program Agreement as in effect at the time
that such Loan Accounts were originated, and shall not be subject to the terms
of this Agreement.

 
 
(d)
This Agreement shall not operate so as to render invalid or improper any action
heretofore taken under the Existing Program Agreement.

 
2.
Program Marketing and Services.

 
 
(a)
Bank hereby retains Company to serve as Bank’s marketing and operations vendor
for the Program.  As such, Company shall perform the following services for Bank
and the Program:

 
 
1

--------------------------------------------------------------------------------

 
 
 
(1)
Company shall promote and otherwise market the Program and the Loan Accounts at
Company’s own cost.  In performing such promotion and other marketing services,
(A) Company may devote such monetary and other resources as it deems appropriate
in its sole discretion; and (B) Company may use any form of media, provided that
Company shall discontinue the use of any specific form of media or media channel
if directed to do so by Bank.  Company’s promotion and marketing efforts shall
not be required to produce any minimum number of Loan Accounts or other benefits
to the Program during the Term of this Agreement or any year, month, or other
period under this Agreement.  Company may refer to Bank and the Program in
promotional and marketing materials, including marketing scripts, upon the
condition that any references to Bank and/or the Program in any such materials
(and any changes in such materials) must receive the prior written approval of
Bank; provided, however, that Bank’s prior written approval shall not be
required with respect to lender- oriented communications by Company to its
existing customers unless such communications also contain any information
(i) directed towards, or about, Borrowers or Applicants, or (ii) describing or
otherwise about the application process, in which case Bank’s prior written
approval of such communications shall be required.  Bank may require a change in
such materials upon written notice provided to Company to the extent that such
change is required by Applicable Laws, or to the extent that Bank determines
such change is necessitated by safety and soundness concerns.  Company shall
ensure that all promotional and marketing materials shall be accurate and not
misleading in all material respects.  Company shall ensure that all promotional
and marketing materials and strategies comply with Applicable Laws.

 
 
(2)
Company shall host and maintain the Program Website and provide customer
support, regulatory compliance, administrative, and other operational services
to support Bank’s origination of Loan Accounts and the Program
generally.  Company shall provide such services in a manner consistent with
Company’s obligations specified in this Agreement and as the Parties may
mutually agree in writing from time to time.

 
 
(b)
Bank acknowledges and agrees that (i) pursuant to Section 12 of this Agreement,
Company is licensing to Bank valuable Proprietary Material of Company for use in
the marketing and operation of the Program, which includes but is not limited to
use of the Program Website; (ii) because the value of such Proprietary Material
may be affected by Bank’s lending activities under the Program, Company requires
Bank to perform and Bank hereby agrees to perform Bank’s lending activities
under the Program with due regard to Company’s interests in such Proprietary
Material and in close coordination with Company as specified hereafter in this
Agreement; and (iii) the compensation to be paid by Bank to Company under this
Agreement is in consideration of Company’s licensing of such Proprietary
Material to Bank as well as Company’s marketing and operational services to Bank
and the Program under this Agreement.

 
3.
Extension of Credit.  Company acknowledges that approval of an Application
creates a creditor-borrower relationship between Bank and Borrower which
involves, among other things, the disbursement of Loan Proceeds.  Nothing in
this Agreement shall obligate Bank to extend credit to an Applicant or disburse
Loan Proceeds if Bank determines that doing so would be an unsafe or unsound
banking practice or that such extension of credit would be in violation of the
Credit Policy.  Bank shall use reasonable commercial efforts to provide Company
prior notice of a decision not to extend credit to an Applicant or disburse Loan
Proceeds in reliance on the preceding sentence and, in all instances where Bank
does not provide such prior notice, Bank shall provide Company prompt notice
after making a decision not to extend credit to an Applicant or disburse Loan
Proceeds in reliance on the preceding sentence.

 
 
2

--------------------------------------------------------------------------------

 
 
4.
Consumer Documents and Credit Policy.  The following documents, terms and
procedures (“Consumer Finance Materials”) that have been approved by Bank and
that will be used by Bank initially with respect to the Loan Accounts are
attached to this Agreement:  (i) the Program Website (screen shots of each page
of the Program Website) as Exhibit A; (ii) Credit Policy as Exhibit B;
(iii) form of Application, including disclosures required by Applicable Laws, as
Exhibit C; and (iv) form of Loan Account Agreement, privacy policy and privacy
notices, and all other Applicant and Borrower communications as Exhibit D.  The
Consumer Finance Materials shall not be changed without the prior written
consent of both Parties, which consent shall not be unreasonably withheld or
delayed; provided, however, that Bank may change the Consumer Finance Materials
upon written notice provided to Company but without Company’s prior written
consent, to the extent that such change is required by Applicable Laws or
necessitated by safety and soundness concerns.  The Parties acknowledge that
each Loan Account Agreement and all other documents referring to the creditor
for the Program shall identify Bank as the creditor for the Loan
Accounts.  Company shall ensure that the Consumer Finance Materials comply with
Applicable Laws.

 
5.
Loan Account Processing and Origination.

 
 
(a)
On behalf of Bank, Company shall process Applications received from Applicants
via the Program Website (including retrieving credit reports) to determine
whether the Applicant meets the eligibility criteria set forth in the Credit
Policy and Bank’s “Know Your Customer” and anti-money laundering criteria
(collectively, the “Bank Secrecy Act Policy”), which is attached hereto as
Exhibit I, and which may be updated by Bank from time to time and such updates
shall be effective upon notice to Company as set forth herein.  Company shall
respond to all inquiries from Applicants regarding the application process.

 
 
(b)
Company shall forward to Bank mutually agreed information including name,
address, social security number and date of birth, regarding Applicants who meet
the eligibility criteria set forth in the Credit Policy.  Company shall have no
discretion to override the Credit Policy with respect to any Applications.

 
 
(c)
Subject to the terms of this Agreement, Bank shall establish Loan Accounts with
respect to Applicants who meet the eligibility criteria set forth in the Credit
Policy.

 
 
(d)
Pursuant to procedures mutually agreed to by the Parties, Company shall deliver
adverse action notices to Applicants who do not meet Credit Policy criteria or
are otherwise denied by Bank.

 
 
(e)
Company shall deliver Program privacy notices and Loan Account Agreements to
Borrowers.

 
 
(f)
Company shall hold and maintain, as custodian for Bank, all documents of Bank
pertaining to Loan Accounts.  Company shall periodically provide to Bank copies
of records required to be maintained under the Bank Secrecy Act Policy and such
other documents regarding Loan Accounts as requested by Bank, at intervals
mutually agreed to by the Parties, but no less frequently than monthly.

 
 
3

--------------------------------------------------------------------------------

 
 
 
(g)
Company shall perform the obligations described in this Section 5 and deliver
any customer communications to Applicants and Borrowers as necessary to carry on
the Program, all at Company’s own cost and in accordance with Applicable Laws.

 
 
(h)
Company shall service the Loan Accounts during the period that the Loan Accounts
are owned by Bank, in compliance with Applicable Law and in accordance with
banking industry standards customary for loans and notes of the same general
type and character.

 
 
(i)
Pursuant to Section 16, as Bank reasonably requires and upon reasonable advance
written notice to Company, Bank will periodically audit Company for compliance
with the terms of this Section 5 and the Agreement as a whole, including
compliance with the standards set forth herein for Loan Account origination.

 
6.
Funding Loans.

 
 
(a)
Company shall provide a Funding Statement to Bank by e-mail or as otherwise
mutually agreed by the Parties by [*].  Each Funding Statement shall (i)
identify those Applicants whose Applications satisfy the requirements of the
Credit Policy and with respect to whom Company requests that Bank establish Loan
Accounts, and (ii) provide the Funding Amount to be disbursed by Bank on such
Funding Date, including instructions for the disbursement of Loan Proceeds to
each Borrower.  The Funding Statement shall be in the form of Exhibit E.

 
 
(b)
Subject to timely receipt of the Funding Statement, and receipt from Company of
instructions for the disbursement of Loan Proceeds to each Borrower, Bank shall
initiate the disbursement of Loan Proceeds to Borrowers in accordance with the
procedures determined by the Parties, by no later than [*].

 
 
(c)
Subject to timely receipt of the Funding Statement, Bank shall transfer by wire
transfer, or initiate a transfer by ACH, to an account designated by Company by
no later than [*] the aggregate amount of Origination Fees set forth on the
Funding Statement, as a Program servicing fee.

 
 
(d)
To the extent that the aggregate principal balance of Loan Accounts held by Bank
(or its Affiliates) would exceed the Program Threshold Amount following the
funding of any Loan Account, Bank may elect not to fund such Loan Account.

 
 
(e)
In addition to any other rights or remedies available to Bank under this
Agreement or by law, Bank shall have the right to suspend payments of the
Funding Amounts during the period commencing with the occurrence of any monetary
default by Company or PFL, as applicable, under the Program Documents and ending
when such condition has been cured, subject to the following:  (1) if the
monetary default is not material, Bank shall notify Company of such default, and
Bank shall not suspend payments of Funding Amounts unless Company or PFL, as
applicable, fails to cure such default within two (2) Business Days of receipt
of such notice from Bank; and (2) if the monetary default is material, Bank may
suspend payments of the Funding Amounts without giving Company or PFL, as
applicable, an opportunity to cure.  For purposes of the foregoing, the failure
by Company or PFL, as applicable, to purchase any Loan Accounts under the Loan
Sale Agreement, or Company’s or PFL’s breach of its indemnification obligations
under the Program Documents, or Company’s or PFL’s failure to timely deposit
money as required by Section 2(b) of the Loan Sale Agreement, shall be deemed a
material default of the Program Documents.  Notwithstanding Bank’s suspension
rights under this Section, Bank may also exercise any right to terminate this
Agreement as permitted herein.

 

--------------------------------------------------------------------------------

* Confidential Treatment Requested
 
 
4

--------------------------------------------------------------------------------

 
 
7.
Representations and Warranties.

 
 
(a)
Bank hereby represents and warrants, as of the Effective Date, or covenants, as
applicable, to Company that:

 
 
(1)
Bank is an FDIC-insured Utah-chartered industrial bank, duly organized, validly
existing under the laws of the State of Utah and has full corporate power and
authority to execute, deliver, and perform its obligations under this Agreement;
the execution, delivery and performance of this Agreement have been duly
authorized, and are not in conflict with and do not violate the terms of the
charter or bylaws of Bank and will not result in a material breach of or
constitute a default under, or require any consent under, any indenture, loan or
agreement to which Bank is a party;

 
 
(2)
All approvals, authorizations, licenses, registrations, consents, and other
actions by, notices to, and filings with, any Person that may be required in
connection with the execution, delivery, and performance of this Agreement by
Bank, have been obtained (other than those required to be made to or received
from Borrowers and Applicants);

 
 
(3)
This Agreement constitutes a legal, valid, and binding obligation of Bank,
enforceable against Bank in accordance with its terms, except (i) as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, receivership, conservatorship or other similar laws
now or hereafter in effect, including the rights and obligations of receivers
and conservators under 12 U.S.C. §§ 1821 (d) and (e), which may affect the
enforcement of creditors’ rights in general, and (ii) as such enforceability may
be limited by general principles of equity (whether considered in a suit at law
or in equity);

 
 
(4)
There are no proceedings or investigations pending or, to the best knowledge of
Bank, threatened against Bank (i) asserting the invalidity of this Agreement,
(ii) seeking to prevent the consummation of any of the transactions contemplated
by Bank pursuant to this Agreement, (iii) seeking any determination or ruling
that, in the reasonable judgment of Bank, would materially and adversely affect
the performance by Bank of its obligations under this Agreement, (iv) seeking
any determination or ruling that would materially and adversely affect the
validity or enforceability of this Agreement or (v) would have a materially
adverse financial effect on Bank or its operations if resolved adversely to it;

 
 
(5)
Bank is not Insolvent;

 
 
5

--------------------------------------------------------------------------------

 
 
 
(6)
The execution, delivery and performance of this Agreement by Bank comply with
Utah and federal banking laws specifically applicable to Bank’s operations;
provided that Bank makes no representation or warranty regarding compliance with
Utah or federal banking laws relating to consumer protection, consumer lending,
usury, loan collections, anti-money laundering, data security or privacy as they
apply to the operation of the Program; and

 
 
(7)
The Proprietary Materials Bank licenses to Company pursuant to Section 12, and
their use as contemplated by this Agreement, do not violate or infringe upon, or
constitute an infringement or misappropriation of, any U.S. patent, copyright or
U.S. trademark, service mark, trade name or trade secret of any person or entity
and Bank has the right to grant the licenses set forth in Section 12 below.

 
 
(b)
Company hereby represents and warrants, as of the Effective Date, or covenants,
as applicable, to Bank that:

 
 
(1)
Company is a corporation, duly organized and validly existing in good standing
under the laws of the State of Delaware, and has full power and authority to
execute, deliver, and perform its obligations under this Agreement; the
execution, delivery, and performance of this Agreement have been duly
authorized, and are not in conflict with and do not violate the terms of the
articles or bylaws of Company and will not result in a material breach of or
constitute a default under or require any consent under any indenture, loan, or
agreement to which Company is a party;

 
 
(2)
All approvals, authorizations, consents, and other actions by, notices to, and
filings with any Person required to be obtained for the execution, delivery, and
performance of this Agreement by Company, have been obtained;

 
 
(3)
This Agreement constitutes a legal, valid, and binding obligation of Company,
enforceable against Company in accordance with its terms, except (i) as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, or other similar laws now or hereafter in effect,
which may affect the enforcement of creditors’ rights in general, and (ii) as
such enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);

 
 
(4)
There are no proceedings or investigations pending or, to the best knowledge of
Company, threatened against Company (i) asserting the invalidity of this
Agreement, (ii) seeking to prevent the consummation of any of the transactions
contemplated by Company pursuant to this Agreement, (iii) seeking any
determination or ruling that, in the reasonable judgment of Company, would
materially and adversely affect the performance by Company of its obligations
under this Agreement, (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of this
Agreement, or (v) except as set forth on Schedule 7(b)(4), that would have a
materially adverse financial effect on Company or its operations if resolved
adversely to it;

 
 
(5)
Company is not Insolvent;

 
 
(6)
The execution, delivery and performance of this Agreement by Company, the
Consumer Finance Materials and the promotional and marketing materials and
strategies shall all comply with Applicable Laws;

 
 
6

--------------------------------------------------------------------------------

 
 
 
(7)
The Proprietary Materials Company licenses to Bank pursuant to Section 12, and
their use as contemplated by this Agreement, do not violate or infringe upon, or
constitute an infringement or misappropriation of, any U.S. patent, copyright or
U.S. trademark, service mark, trade name or trade secret of any person or entity
and Company has the right to grant the license set forth in Section 12 below;
and

 
 
(8)
Company shall comply with Title V of the Gramm-Leach-Bliley Act and the
implementing regulations of the FDIC, including but not limited to applicable
limits on the use, disclosure, storage, safeguarding and destruction of
Applicant information, and shall maintain commercially reasonable data security
and disaster recovery protections that at the least are consistent with industry
standards for the consumer lending industry.

 
 
(c)
Company hereby represents and warrants to Bank as of each Funding Date that:

 
 
(1)
For each Loan Account and each disbursement of Loan Proceeds:  (i) to the best
of Company’s knowledge, all information in the related Application is true and
correct, provided, however, that Company’s representation and warranty in this
regard shall be subject to the following limitations: (A) Company does not
verify the self-reported income, employment and occupation or other information
provided by Applicants in listings, (B) each Applicant’s debt-to-income ratio is
determined by Company from a combination of the Applicant’s self-reported income
and information from the Applicant’s credit report and not otherwise verified by
Company, (C) credit data that appears in Applications is taken directly from a
credit report obtained on the Applicant from a credit reporting agency, without
any review or verification by Company, (D) Company does not verify any
statements by Applicants as to how Loan Proceeds are to be used and does not
confirm after loan disbursement how Loan Proceeds were used, and (E) Applicants’
home ownership status is not verified by Company but is derived from the
Applicant’s credit report, in that if the credit report reflects an active
mortgage loan the Applicant is presumed to be a homeowner; (ii) the Loan Account
is fully enforceable and all required disclosures to Borrowers have been
delivered in compliance with Applicable Laws; (iii) the Loan Account Agreement
and all other Loan Account documents are genuine and legally binding and
enforceable, conform to the requirements of the Program and were prepared in
conformity with the Program Compliance Manual; (iv) all necessary approvals
required to be obtained by Company have been obtained; (v) nothing exists that
would prohibit the sale of the Loan Accounts by Bank to Company or PFL, as
applicable, under the Loan Sale Agreement, provided that Bank has taken no
action (independent of action taken by Company on Bank’s behalf) that would
prohibit the sale of the Loan Accounts by Bank to Company or PFL, as applicable,
under the Loan Sale Agreement; and (vi) Bank is the sole owner of the Loan
Accounts prior to any such sale of the Loan Accounts to Company or PFL, as
applicable, provided that Bank has taken no action (independent of action taken
by Company on Bank’s behalf) that diminishes Bank’s ownership rights in the Loan
Accounts;

 
 
(2)
Each Borrower listed on a Funding Statement is eligible for a Loan Account under
the Credit Policy; and each Borrower has submitted an Application; and

 
 
7

--------------------------------------------------------------------------------

 
 
 
(3)
The information on each Funding Statement is true and correct in all respects.

 
 
(d)
The representations and warranties of Bank and Company contained in this Section
7, except those representations and warranties contained in subsections 7(a)(4)
and 7(b)(4), are made continuously throughout the term of this Agreement.  In
the event that any investigation or proceeding of the nature described in
subsections 7(a)(4) and 7(b)(4) is instituted or threatened against either
Party, such Party shall promptly notify the other Party of the pending or
threatened investigation or proceeding (unless prohibited from doing so by
Applicable Laws or the direction of a Regulatory Authority).

 
8.
Other Relationships with Borrowers.

 
 
(a)
Separate from the obligation to market Loan Accounts offered by Bank, and
subject to the Program privacy policy and Applicable Laws, Company shall have
the right, at its own expense, to solicit Applicants and/or Borrowers with
offerings of other goods and services from Company and parties other than Bank,
provided, however, that in the event that Company uses Bank’s name and/or
Proprietary Materials in connection with such offerings, Company shall obtain
Bank’s prior approval for such use.

 
 
(b)
Except as necessary to carry out its rights and responsibilities under this
Agreement and the Loan Sale Agreement, Bank shall not use Applicant and/or
Borrower information and shall not provide or disclose any Applicant and/or
Borrower information to any Person, except to the extent required to do so under
Applicable Laws or legal process.

 
 
(c)
Notwithstanding subsection 8(b), (i) Bank may make solicitations for goods and
services to the public, which may include one or more Applicants or Borrowers;
provided that Bank does not (A) target such solicitations to specific Applicants
and/or Borrowers, (B) use or permit a third party to use any list of Applicants
and/or Borrowers in connection with such solicitations or (C) refer to or
otherwise use the name of Company; and (ii) Bank shall not be obligated to
redact the names of Applicants and/or Borrowers from marketing lists acquired
from third parties (e.g., subscription lists) that Bank uses for solicitations.

 
 
(d)
The terms of this Section 8 shall survive the expiration or earlier termination
of this Agreement.

 
9.
Indemnification.

 
 
(a)
Company agrees to defend, indemnify, and hold harmless Bank and its Affiliates,
and the officers, directors, employees, representatives, shareholders, agents
and attorneys of such entities (the “Indemnified Parties”) from and against any
and all claims, actions, liability, judgments, damages, costs and expenses,
including reasonable attorneys’ fees (“Losses”) to the extent arising from
Bank’s participation in the Program as contemplated by this Agreement (including
Losses arising from a violation of Applicable Laws or a breach by Company or its
agents or representatives of any of Company’s representations, warranties,
obligations or undertakings under this Agreement), unless such Loss results from
(i) the gross negligence or willful misconduct of Bank, or (ii) Bank’s failure
to timely transfer the Funding Amount to the extent required under Section 6(b),
provided that Company and PFL are not in breach of any of their respective
obligations under the Program Documents, including, but not limited to, their
obligations with respect to the purchase of Loan Accounts under the Loan Sale
Agreement before or after, respectively, the Changeover Date (as defined
therein) or the Stand By Loan Purchase Agreement.

 
 
8

--------------------------------------------------------------------------------

 
 
 
(b)
To the extent permitted by Applicable Laws, any Indemnified Party
seeking  indemnification hereunder shall promptly notify Company, in writing, of
any notice of the assertion by any third party of any claim or of the
commencement by any third party of any legal or regulatory proceeding,
arbitration or action, or if the Indemnified Party determines the existence of
any such claim or the commencement by any third party of any such legal or
regulatory proceeding, arbitration or action, whether or not the same shall have
been asserted or initiated, in any case with respect to which Company is or may
be obligated to provide indemnification (an “Indemnifiable Claim”), specifying
in reasonable detail the nature of the Loss and, if known, the amount or an
estimate of the amount of the Loss; provided, that failure to promptly give such
notice shall only limit the liability of Company to the extent of the actual
prejudice, if any, suffered by Company as a result of such failure.  The
Indemnified Party shall provide to Company as promptly as practicable thereafter
information and documentation reasonably requested by Company to defend against
the Indemnifiable Claim.

 
 
(c)
Company shall have ten (10) days after receipt of any notification of an
Indemnifiable Claim (a “Claim Notice”) to notify the Indemnified Party of
Company’s election to assume the defense of the Indemnifiable Claim and, through
counsel of its own choosing, and at its own expense, to commence the settlement
or defense thereof, and the Indemnified Party shall cooperate with Company in
connection therewith if such cooperation is so requested and the request is
reasonable; provided that Company shall hold the Indemnified Party harmless from
all its reasonable out-of-pocket expenses, including reasonable attorneys’ fees,
incurred in connection with the Indemnified Party’s cooperation; provided,
further, that if the Indemnifiable Claim relates to a matter before a Regulatory
Authority, the Indemnified Party may elect, upon notice to Company, to assume
the defense of the Indemnifiable Claim at the cost of and with the cooperation
of Company.  If the Company assumes responsibility for the settlement or defense
of any such claim, (i) Company shall permit the Indemnified Party to participate
at the Indemnified Party’s expense in such settlement or defense through counsel
chosen by the Indemnified Party; provided that, in the event that both Company
and the Indemnified Party are defendants in the proceeding and the Indemnified
Party shall have reasonably determined and notified Company that representation
of both parties by the same counsel would be inappropriate due to the actual or
potential differing interests between them, then the fees and expenses of one
such counsel for all Indemnified Parties in the aggregate shall be borne by
Company; and (ii) Company shall not settle any Indemnifiable Claim without the
Indemnified Party’s consent.

 
 
(d)
If the Company does not notify the Indemnified Party within ten (10) days after
receipt of the Claim Notice that it elects to undertake the defense of the
Indemnifiable Claim described therein, or if Company fails to contest vigorously
any such Indemnifiable Claim, or if the Indemnified Party elects to control the
defense of an Indemnifiable Claim as permitted by Section 9(c), then, in each
case, the Indemnified Party shall have the right, upon notice to the Company, to
contest, settle or compromise the Indemnifiable Claim in the exercise of its
reasonable discretion; provided that the Indemnified Party shall notify Company
prior thereto of any compromise or settlement of any such Indemnifiable
Claim.  No action taken by the Indemnified Party pursuant to this paragraph (d)
shall deprive the Indemnified Party of its rights to indemnification pursuant to
this Section 9.

 
 
9

--------------------------------------------------------------------------------

 
 
 
(e)
All amounts due under this Section 9 shall be payable not later than ten (10)
days after written demand therefor.

 
 
(f)
The terms of this Section 9 shall survive the expiration or earlier termination
of this Agreement.

 
10.
Term and Termination.

 
 
(a)
This Agreement shall have an initial term beginning on the Effective Date and
ending thirty-six (36) months thereafter (the “Initial Term”) and shall renew
automatically for two (2) successive terms of one (1) year each (each a “Renewal
Term,” collectively, the Initial Term and Renewal Term(s) shall be referred to
as the “Term”), unless either Party provides notice of non-renewal to the other
Party at least ninety (90) days prior to the end of the Initial Term or any
Renewal Term or this Agreement is earlier terminated in accordance with the
provisions hereof.

 
 
(b)
This Agreement shall terminate immediately upon the expiration or earlier
termination of the Loan Sale Agreement or the Stand By Loan Purchase Agreement.

 
 
(c)
Bank shall have a right to terminate this Agreement in the event of a Change of
Control of Company.  Company shall provide written notice to Bank of any
expected or anticipated Change of Control of Company not later than thirty (30)
Business Days prior to the effective date of such Change of Control.

 
 
(d)
A Party shall have a right to terminate this Agreement immediately upon written
notice to the other Party in any of the following circumstances:

 
 
(1)
any representation or warranty made by the other Party in this Agreement shall
be incorrect in any material respect and shall not have been corrected within
thirty (30) Business Days after written notice thereof has been given to such
other Party;

 
 
(2)
the other Party shall default in the performance of any obligation or
undertaking under this Agreement and such default shall continue for thirty (30)
Business Days after written notice thereof has been given to such other Party;

 
 
(3)
the other Party shall commence a voluntary case or other proceeding seeking
liquidation, reorganization, or other relief with respect to itself or its debts
under any bankruptcy, insolvency, receivership, conservatorship or other similar
law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, conservator, custodian, or other similar official of it or
any substantial part of its property, or shall consent to any such relief or to
the appointment of a trustee, receiver, liquidator,  conservator, custodian, or
other similar official or to any involuntary case or other proceeding commenced
against it, or shall make a general assignment for the benefit of creditors, or
shall fail generally to pay its debts as they become due, or shall take any
corporate action to authorize any of the foregoing;

 
 
10

--------------------------------------------------------------------------------

 
 
 
(4)
an involuntary case or other proceeding, whether pursuant to banking regulations
or otherwise, shall be commenced against the other Party seeking liquidation,
reorganization, or other relief with respect to it or its debts under any
bankruptcy, insolvency, receivership, conservatorship or other similar law now
or hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, conservator, custodian, or other similar official of it or any
substantial part of its property; or an order for relief shall be entered
against either Party under the federal bankruptcy laws as now or hereafter in
effect; or

 
 
(5)
there is a materially adverse change in the financial condition of the other
Party.

 
 
(e)
Bank shall not be obligated to approve Applications or establish new Loan
Accounts after termination of this Agreement; provided, that Bank shall
originate Loan Accounts to Applicants to whom Bank has issued a lending
commitment prior to termination, unless this Agreement is terminated pursuant to
subsection 10(b) or by Bank pursuant to subsection 10(d).

 
 
(f)
The termination of this Agreement either in part or in whole shall not discharge
any Party from any obligation incurred prior to such termination.

 
 
(g)
Upon termination of this Agreement, Company shall purchase all Loan Accounts
established by Bank prior to and on the date of termination that have not
already been purchased by Company.  After termination, Company shall purchase
all Loan Accounts originated by Bank pursuant to subsection 10(e).

 
 
(h)
Company’s failure to obtain the approval of Bank as required by Sections
2(a)(1), 4 or 30, and Company’s failure to provide any notice required by
Section 32, shall each constitute a material breach of this Agreement.  In
addition to any other remedies permitted by Applicable Law or this Agreement and
without limiting Bank’s rights under Section 9, Bank may also invoice Company
for, and Company agrees to pay, liquidated damages in the amount of [*].  The
Parties agree that it would be difficult to determine the precise damages to
Bank in the event of such a breach by Company, and the Parties have therefore
agreed on the foregoing liquidated damages as a reasonable approximation of the
damages to Bank in the event of such a breach.

 
 
(i)
Bank may terminate this Agreement immediately upon written notice to Company if
Bank incurs any Loss that would have been subject to indemnification under
Section 9(a) but for the application of Applicable Laws that limit or restrict
Bank’s ability to seek such indemnification.

 
 
(j)
The terms of this Section 10 shall survive the expiration or earlier termination
of this Agreement.

 

--------------------------------------------------------------------------------

* Confidential Treatment Requested
 
 
11

--------------------------------------------------------------------------------

 
 
11.
Confidentiality.

 
 
(a)
Each Party agrees that Confidential Information of the other Party shall be
used by such Party solely in the performance of its obligations and exercise of
its rights pursuant to the Program Documents.  Except as required by Applicable
Laws or legal process, neither Party (the “Restricted Party”) shall disclose
Confidential Information of the other Party to third parties; provided, however,
that the Restricted Party may disclose Confidential Information of the other
Party (i) to the Restricted Party’s Affiliates, agents, representatives or
subcontractors for the sole purpose of fulfilling the Restricted Party’s
obligations under this Agreement (as long as the Restricted Party exercises
reasonable efforts to prohibit any further disclosure by its Affiliates, agents,
representatives or subcontractors), provided that in all events, the Restricted
Party shall be responsible for any breach of the confidentiality obligations
hereunder by any of its Affiliates, agents, representatives or subcontractors,
(ii) to the Restricted Party’s auditors, accountants and other professional
advisors, or to a Regulatory Authority or (iii) to any other third party as
mutually agreed by the Parties.

 
 
(b)
A Party’s Confidential Information shall not include information that:

 
 
(1)
is generally available to the public;

 
 
(2)
has become publicly known, without fault on the part of the Party who now seeks
to disclose such information (the “Disclosing Party”), subsequent to the
Disclosing Party acquiring the information;

 
 
(3)
was otherwise known by, or available to, the Disclosing Party prior to entering
into this Agreement; or

 
 
(4)
becomes available to the Disclosing Party on a non-confidential basis from a
Person, other than a Party to this Agreement, who is not known by the Disclosing
Party after reasonable inquiry to be bound by a confidentiality agreement with
the non-Disclosing Party or otherwise prohibited from transmitting the
information to the Disclosing Party.

 
 
(c)
Upon written request or upon the termination of this Agreement, each Party
shall, within thirty (30) days, return to the other Party all Confidential
Information of the other Party in its possession that is in written form,
including by way of example, but not limited to, reports, plans, and manuals;
provided, however, that either Party may maintain in its possession all such
Confidential Information of the other Party required to be maintained under
Applicable Laws relating to the retention of records for the period of time
required thereunder or stored on such Party’s network as part of standard
back-up procedures (provided that such information shall remain subject to the
confidentiality provisions of this Section 11).

 
 
(d)
In the event that a Restricted Party is requested or required (by oral
questions, interrogatories, requests for information or documents, subpoena,
civil investigative demand or similar process) to disclose any Confidential
Information of the other Party, the Restricted Party shall provide the other
Party with prompt notice of such request(s) so that the other Party may seek an
appropriate protective order or other appropriate remedy and/or waive the
Restricted Party’s compliance with the provisions of this Agreement.  In the
event that the other Party does not seek such a protective order or other
remedy, or such protective order or other remedy is not obtained, or the other
Party grants a waiver hereunder, the Restricted Party may furnish that portion
(and only that portion) of the Confidential Information of the other Party which
the Restricted Party is legally compelled to disclose and shall exercise such
efforts to obtain reasonable assurance that confidential treatment shall be
accorded any Confidential Information of the other Party so furnished as the
Restricted Party would exercise in assuring the confidentiality of any of its
own Confidential Information.

 
 
12

--------------------------------------------------------------------------------

 
 
 
(e)
The terms of this Section 11 shall survive the expiration or earlier termination
of this Agreement.

 
12.
Proprietary Material.

 
 
(a)
Each Party (“Licensing Party”) hereby provides the other Party (“Licensee”) with
a non-exclusive right and license to use and reproduce the Licensing Party’s
name, logo, registered or other trademarks and service marks (collectively,
“Marks”) on the Applications, Loan Account Agreements, and other Consumer
Finance Materials (including the Program Website), Program marketing materials,
and any other publicly distributed or available Program materials, and to
otherwise use the Marks and such copyrights, patents, and other intellectual
property as the Licensing Party may designate or otherwise make available from
time to time in the Licensing Party’s sole discretion (collectively with the
Marks, “Proprietary Material”) for the purposes of or otherwise in connection
with the fulfillment of Licensee’s obligations under this Agreement; provided,
however, that (i) the Licensee shall at all times comply with any and all
written instructions provided by the Licensing Party from time to time regarding
the use of the Licensing Party’s Proprietary Material, and (ii) each Licensee
acknowledges that, except for the license specifically provided in this
Agreement, it shall acquire no interest in the Licensing Party’s Proprietary
Material.  Upon termination of this Agreement, each such license will terminate,
and the Licensee shall cease using the Licensing Party’s Proprietary Material.
Neither Party may use the other Party’s Marks in any press release without the
prior written consent of the other Party.

 
 
(b)
Bank hereby acknowledges and agrees that, as between Bank and Company (i) as of
the Effective Date, Company is the sole and exclusive owner of all pre-existing
Marks, copyrights, patents, other intellectual property rights, software, other
technology, and other tangible and intangible property used on or in connection
with the Program Website, and its Company run predecessors;  and (ii) Company
shall be the sole and exclusive owner of any and all modifications to such
tangible and intangible property during the Term of this Agreement, including
but not limited to any and all trademark, service mark, copyright, patent, and
other intellectual property rights in and to such modifications, except as the
Parties may otherwise agree in writing.  For avoidance of doubt, Company shall
not obtain any rights in Bank’s Marks (other than the license described in
subsection 12(a)) by virtue of incorporation of Bank’s Marks into the Program
Website.

 
13.
Relationship of Parties.  The Parties agree that in performing their respective
responsibilities pursuant to this Agreement, they are in the position of
independent contractors.  This Agreement is not intended to create, nor does it
create and shall not be construed to create, a relationship of partner or joint
venturer or any association for profit between Bank and Company.

 
 
13

--------------------------------------------------------------------------------

 
 
14.
Expenses.

 
 
(a)
Except as set forth herein, each Party shall bear the costs and expenses of
performing its obligations under this Agreement.

 
 
(b)
Company shall pay all wire transfer and ACH costs for transfers by Bank under
the Program.  Company shall reimburse Bank for all third party fees incurred by
Bank in connection with the performance of the Program Documents.  Bank shall
provide Company with notice of third party fees to be incurred by Bank in
connection with performance of the Program Documents as soon as practicable
after Bank becomes aware of such fees.

 
 
(c)
Company shall pay all costs of any credit reports it obtains on Applicants or
Borrowers and any adverse action notices it delivers to Applicants or Borrowers
in accordance with Company’s Application processing and Loan Account servicing
responsibilities under this Agreement.

 
 
(d)
Each Party shall be responsible for payment of any federal, state, or local
taxes or assessments associated with the performance of its obligations under
this Agreement and for compliance with all filing, registration and other
requirements with regard thereto.

 
 
(e)
Company shall be responsible for (i) all of Bank’s out-of-pocket legal fees
directly related to the Program, including Bank’s attorneys’ fees and expenses
in connection with the preparation, negotiation, execution, and delivery of the
Program Documents; any amendment, modification, administration, collection and
enforcement of the Program Documents; any modification of the Consumer Finance
Materials or other documents or disclosures related to the Program; or any
dispute or litigation arising out of or related to the Program; and (ii) all of
Bank’s out-of-pocket costs and expenses for any other third-party professional
services related to the Program, including the services of any third-party
compliance specialists in connection with Bank’s preparation of policies and
procedures and Bank’s review of the Program.  To the extent that such fees are
expected to exceed [*], Bank will provide oral or email notification to the
extent reasonably practicable.  Company shall also pay for an annual audit of
the Program by a third-party firm.  Bank shall invoice Company for such
fees.  Company shall pay such invoice within thirty (30) days of receipt of such
invoice.

 
 
(f)
Company shall reimburse Bank for all reasonable costs associated with Bank’s
assignment to Company of Loan Accounts pursuant to Section 10.

 
15.
Examination.  Each Party agrees to submit to any examination that may be
required by a Regulatory Authority having jurisdiction over the other Party,
during regular business hours and upon reasonable prior notice, and to otherwise
provide reasonable cooperation to the other Party in responding to such
Regulatory Authority’s inquiries and requests related to the Program.

 

--------------------------------------------------------------------------------

* Confidential Treatment Requested
 
 
14

--------------------------------------------------------------------------------

 
 
16.
Inspection; Reports.  Each Party, upon reasonable prior notice from the other
Party, agrees to submit to an inspection of its books, records, accounts, and
facilities relevant to the Program, from time to time, during regular business
hours subject to the duty of confidentiality each Party owes to its customers
and banking secrecy and confidentiality requirements otherwise applicable to
each Party under Applicable Laws.  All expenses of inspection shall be borne by
the Party conducting the inspection.  Notwithstanding the obligation of each
Party to bear its own expenses of inspection, Company shall reimburse Bank for
reasonable out of pocket expenses incurred by Bank in the performance of
periodic on site reviews of Company’s financial condition, operations and
internal controls, not to exceed the maximum amount per visit of [*].  Company
shall store all documentation and electronic data related to its performance
under this Agreement and shall make such documentation and data available during
any inspection by Bank or its designee.  With such reasonable frequency and in
such reasonable manner as mutually agreed by the Parties, Company shall report
to Bank regarding the performance of its obligations.

 
17.
Governing Law; Waiver of Jury Trial.  This Agreement shall be interpreted and
construed in accordance with the laws of the State of Utah, without giving
effect to the rules, policies, or principles thereof with respect to conflicts
of laws.  THE PARTIES HEREBY EXPRESSLY WAIVE ANY RIGHT TO TRIAL BY JURY OF ANY
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION ARISING HEREUNDER. The terms of this
Section 17 shall survive the expiration or earlier termination of this
Agreement.

 
18.
Severability.  Any provision of this Agreement which is deemed invalid, illegal
or unenforceable in any jurisdiction, shall, as to that jurisdiction, be
ineffective to the extent of such invalidity, illegality or unenforceability,
without affecting in any way the remaining portions hereof in such jurisdiction
or rendering such provision or any other provision of this Agreement invalid,
illegal, or unenforceable in any other jurisdiction.

 
19.
Assignment.  This Agreement and the rights and obligations created under it
shall be binding upon and inure solely to the benefit of the Parties and their
respective successors, and permitted assigns.  Neither Party shall be entitled
to assign or transfer any interest under this Agreement (including by operation
of law) without the prior written consent of the other Party, which shall not be
unreasonable withheld or delayed.  No assignment made in conformity with this
Section 19 shall relieve a Party of its obligations under this
Agreement.  Company may use subcontractors in the performance of its obligations
under this Agreement, subject to Bank’s prior written approval of each such
subcontractor, which approval shall not be unreasonably withheld or delayed.  A
list of subcontractors already approved by Bank is attached in the form of
Exhibit H hereto.

 
20.
Third Party Beneficiaries.  Nothing contained herein shall be construed as
creating a third-party beneficiary relationship between either Party and any
other Person.

 
21.
Notices.  All notices and other communications that are required or may be given
in connection with this Agreement shall be in writing and shall be deemed
received (a) on the day delivered, if delivered by hand; (b) on the day
transmitted, if transmitted by facsimile or e-mail with receipt confirmed; or
(c)  three (3) business days after the date of mailing to the other Party, if
mailed first-class postage prepaid, at the following address, or such other
address as either Party shall specify in a notice to the other:

 

--------------------------------------------------------------------------------

* Confidential Treatment Requested
 
 
15

--------------------------------------------------------------------------------

 
 

 
To Bank:
WebBank
   
Attn: Senior Vice President –  Strategic Partners
   
215 S. State Street, Suite 800
   
Salt Lake City, UT  84111
   
Tel. (801) 456-8398
   
Fax:  (801) 456-8398
   
Email:  strategicpartnerships@webbank.com
         
With a copy to:
   
WebBank
   
Attn:  Compliance Officer
   
215 S. State Street, Suite 800
   
Salt Lake City, UT  84111
   
Tel. (801) 456-8363
   
Fax:  (801) 456-8363
   
Email:  complianceofficer@webbank.com
       
To Company:
Prosper Marketplace, Inc.
   
111 Sutter Street, 22nd Floor
   
San Francisco, CA  94104
   
Attn:  Kirk T. Inglis
   
E-mail Address: kirk@propser.com
   
Telephone: (415) 593-5432
   
Facsimile: (415) 362-7233

 
22.
Amendment and Waiver.  This Agreement may be amended only by a written
instrument signed by each of the Parties.  The failure of a Party to require the
performance of any term of this Agreement or the waiver by a Party of any
default under this Agreement shall not prevent a subsequent enforcement of such
term and shall not be deemed a waiver of any subsequent breach.  All waivers
must be in writing and signed by the Party against whom the waiver is to be
enforced.

 
23.
Entire Agreement.  The Program Documents, including this Agreement and its
schedules and exhibits (all of which schedules and exhibits are hereby
incorporated into this Agreement), constitute the entire agreement between the
Parties with respect to the subject matter hereof, and supersede any prior or
contemporaneous negotiations or oral or written agreements with regard to the
same subject matter.

 
24.
Counterparts.  This Agreement may be executed and delivered by the Parties in
any number of counterparts, and by different parties on separate counterparts,
each of which counterpart shall be deemed to be an original and all of which
counterparts, taken together, shall constitute but one and the same instrument.

 
25.
Interpretation.  The Parties acknowledge that each Party and its counsel have
reviewed and revised this Agreement and that the normal rule of construction to
the effect that any ambiguities are to be resolved against the drafting party
shall not be employed in the interpretation of this Agreement or any amendments
thereto, and the same shall be construed neither for nor against either Party,
but shall be given a reasonable interpretation in accordance with the plain
meaning of its terms and the intent of the Parties.

 
 
16

--------------------------------------------------------------------------------

 
 
26.
Agreement Subject to Applicable Laws.  If (a) either Party has been advised by
legal counsel of a change in Applicable Laws or any judicial decision of a court
having jurisdiction over such Party or any interpretation of a Regulatory
Authority that, in the view of such legal counsel, would have a materially
adverse effect on the rights or obligations of such Party under this Agreement
or the financial condition of such Party, (b) either Party receives a request of
any Regulatory Authority having jurisdiction over such Party, including any
letter or directive of any kind from any such Regulatory Authority, that
prohibits or restricts such Party from carrying out its obligations under this
Agreement, or (c) either Party has been advised by legal counsel that there is a
material risk that such Party’s or the other Party’s continued performance under
this Agreement would violate Applicable Laws, then the Parties shall meet and
consider in good faith any modifications, changes or additions to the Program or
the Program Documents that may be necessary to eliminate such
result.  Notwithstanding any other provision of the Program Documents, including
Section 10 hereof, if the Parties are unable to reach agreement regarding such
modifications, changes or additions to the Program or the Program Documents
within ten (10) Business Days after the Parties initially meet, either Party may
terminate this Agreement upon five (5) days’ prior written notice to the other
Party.  A Party may suspend performance of its obligations under this Agreement,
or require the other Party to suspend its performance of its obligations under
this Agreement, upon providing the other Party advance written notice, if any
event described in subsections 26(a), (b) or (c) above occurs.

 
27.
Force Majeure.  If any Party is unable to carry out the whole or any part of its
obligations under this Agreement by reason of a Force Majeure Event, then the
performance of the obligations under this Agreement of such Party as they are
affected by such cause shall be excused during the continuance of the inability
so caused, except that should such inability not be remedied within thirty (30)
days after the date of such cause, the Party not so affected may at any time
after the expiration of such thirty (30) day period, during the continuance of
such inability, terminate this Agreement on giving written notice to the other
Party and without payment of a termination fee or other penalty.  To the extent
that the Party not affected by a Force Majeure Event is unable to carry out the
whole or any part of its obligations under this Agreement because a prerequisite
obligation of the Party so affected has not been performed, the Party not
affected by a Force Majeure Event also is excused from such performance during
such period.  A “Force Majeure Event” as used in this Agreement shall mean an
unanticipated event that is not reasonably within the control of the affected
Party or its subcontractors (including, but not limited to, acts of God, acts of
governmental authorities, strikes, war, riot and any other causes of such
nature), and which by exercise of reasonable due diligence, such affected Party
or its subcontractors could not reasonably have been expected to avoid, overcome
or obtain, or cause to be obtained, a commercially reasonable substitute
therefore.  No Party shall be relieved of its obligations hereunder if its
failure of performance is due to removable or remediable causes which such Party
fails to remove or remedy using commercially reasonable efforts within a
reasonable time period.  Either Party rendered unable to fulfill any of its
obligations under this Agreement by reason of a Force Majeure Event shall give
prompt notice of such fact to the other Party, followed by written confirmation
of notice, and shall exercise due diligence to remove such inability with all
reasonable dispatch.

 
28.
Jurisdiction; Venue.  The Parties consent to the personal jurisdiction and venue
of the federal and state courts in Salt Lake City, Utah for any court action or
proceeding.  The terms of this Section 28 shall survive the expiration or
earlier termination of this Agreement.

 
 
17

--------------------------------------------------------------------------------

 
 
29.
Insurance.  Company agrees to maintain insurance coverage on the terms and
conditions specified in Exhibit F at all times during the term of this Agreement
and to notify Bank promptly of any cancellation or lapse of any such insurance
coverage.

 
30.
Compliance with Applicable Laws; Program Compliance Manual.  Company shall
comply with Applicable Laws, the Bank Secrecy Act Policy and the Program
Compliance Manual in its performance of this Agreement, including Loan Account
solicitation, Application processing and preparation of Loan Account Agreements
and other Loan Account documents.  The Program Compliance Manual shall not be
changed without the prior written consent of both Parties, which consent shall
not be unreasonably withheld or delayed; provided, however, that Bank may change
the Program Compliance Manual upon written notice provided to Company but
without Company’s prior written consent, to the extent that such change is
required by Applicable Laws, or to the extent that Bank determines such change
is necessitated by safety and soundness concerns.  A copy of the Program
Compliance Manual is attached hereto as Exhibit G.  Without limiting the
foregoing, Company shall:

 
 
(a)
apply to all Applicants customer identification procedures that comply with
Section 326 of the USA PATRIOT Act of 2001 (“Patriot Act”) and the implementing
regulations applicable to Bank (31 C.F.R. § 103.121);

 
 
(b)
retain for five (5) years after a Loan Account is purchased from Bank, and
deliver to Bank upon request: (i) the Applicant’s name, address, social security
number, and date of birth obtained pursuant to such customer identification
procedures; (ii) a description of the methods and the results of any measures
undertaken to verify the identity of the Applicant; and (iii) a description of
the resolution of any substantive discrepancy discovered when verifying the
identifying information obtained;

 
 
(c)
screen all Applicants against the Office of Foreign Assets Control list of
Specially Designated Nationals and Blocked Persons, and reject any Applicant
whose name appears on such list and notify Bank thereof;

 
 
(d)
monitor, identify and report to Bank any suspicious activity that meets the
thresholds for submitting a Suspicious Activity Report under the Bank Secrecy
Act and the implementing regulations applicable to Bank (31 C.F.R. § 103.18);

 
 
(e)
implement an anti-money laundering program to assist Bank in its compliance with
Section 352 of the Patriot Act and the implementing regulations applicable to
Bank (31 C.F.R. § 103.120);

 
 
(f)
in addition to the information retained pursuant to subsection (b) above, retain
the account number identifying a Borrower’s Loan Account for at least one (1)
year after purchasing the Borrower’s Loan Account from Bank;

 
 
(g)
upon receipt of a government information request forwarded by Bank to Company,
(i) compare the names, addresses, and social security numbers on such government
list provided by Bank with the names, addresses, and social security numbers of
Borrowers for all Loan Accounts purchased from Bank within the prior twelve (12)
months, and (ii) within one (1) week of receipt of such an information request,
deliver to Bank a certification of completion of such a records search, which
shall indicate whether Company located a name, address, or social security
number match and, if so, provide for any such match: the name of the Borrower,
the account number identifying the Borrower’s Loan Account, and the Borrower’s
social security number, date of birth, address, or other similar identifying
information provided by the Borrower, to assist Bank in its compliance with
Section 314(a) of the Patriot Act and the implementing regulations applicable to
Bank (31 C.F.R. § 103.100);

 
 
18

--------------------------------------------------------------------------------

 
 

 
(h)
provide to Bank electronic copies of the information retained pursuant to
subsections (b) and (g) above as mutually agreed to by the Parties, immediately
upon request;

 
 
(i)
(i) maintain policies and procedures in a form approved by Bank (“Red Flags
Policy”) to (1) detect relevant red flags that may arise in the performance of
Company’s obligations, (2) take appropriate steps to address such red flags and
to prevent and mitigate the effect of identity theft, (3) report to Bank on such
policies and procedures on a regular basis, and (4) otherwise assist Bank in
complying with the provisions of § 605A of the Fair Credit Reporting Act, 15
U.S.C. § 1681c-1, and applicable implementing regulations; (ii) identify a
program administrator responsible for the Red Flags Policy; (iii) conduct annual
training regarding the Red Flags Policy; and (iv) provide a written report
regarding the Red Flags Policy no less frequently than annually, by the date
designated by the Bank, which report shall (1) address material matters related
to the program, (2) evaluate issues such as the effectiveness of the Red Flags
Policy in addressing the risk of identity theft in connection with the opening
of covered accounts and with respect to existing covered accounts, (3) identify
service provider arrangements, (4) identify significant incidents involving
identity theft and management's response, and (5) provide recommendations for
material changes to the Red Flags Policy;

 
 
(j)
develop and implement a compliance management system (“CMS”) to provide an
internal control process for the business functions and processes directed
towards Applicants and Borrowers, the elements of which CMS shall include (i) an
overall policy statement governing the CMS, (ii) specific procedures for
approvals of additions or changes to the CMS, including a description of items
subject to the CMS, a process for internal review and approval by Company and
its legal counsel, and a process for internal review and approval by Bank and
its legal counsel, and (iii) documentation of Company’s testing process,
including testing/review of Company’s website and user acceptance testing (UAT);
the scope of the CMS shall include, at a minimum, the Consumer Finance
Materials, all policy changes, new products, advertisements, press releases, and
the website(s) used in connection with the Program;

 
 
(k)
maintain a compliance training program for its officers, directors, employees,
and agents that is acceptable to Bank; as part of the program, Company shall,
subject in each case to the approval of Bank, (i) identify applicable Company
officers, directors, employees, and agents and assign appropriate training
courses to each and (ii) determine a schedule of each training course and when
each applicable officer, director, employee, and agent shall take each such
course; Company shall provide reports to Bank regarding the compliance training
program on a quarterly basis or, if requested by Bank, more frequently;

 
 
19

--------------------------------------------------------------------------------

 
 
 
(l)
designate a dedicated compliance officer for purposes of the Program, acceptable
to Bank, who shall oversee reviews of Company’s compliance with laws and
regulations that may be applicable, including, to the extent applicable, the
Fair Credit Reporting Act, the Equal Credit Opportunity Act, the Fair Debt
Collection Practices Act, the Truth-in-Lending Act and Regulation Z, the Federal
Trade Commission (FTC) Act, the Consumer Financial Protection Act, and laws
prohibiting unfair, deceptive, or abusive acts or practices; and, in the event
of the termination of the employment of the compliance officer, promptly employ
a replacement compliance officer acceptable to Bank;

 
 
(m)
cooperate with and bear the expenses of a compliance audit of the Program on an
annual basis, and such other audits as may be requested by Bank from time to
time in its reasonable discretion, in each case to be conducted by a third-party
audit firm that is selected by and reports to Bank; the scope of each audit
shall be determined by Bank (considering in good faith input received by
Company); Bank shall receive all draft and final reports of the audit firm and
shall be included in any meetings or correspondence related to the audit; the
auditor shall deliver the final audit report to Bank, and Bank shall provide a
copy of the report to Company;

 
 
(n)
provide to Bank, on an annual basis in writing, a report by the compliance
officer of the results of all audits and reviews of the Program, and significant
issues to be addressed (if any), as well as Company’s resolutions of such issues
(if applicable); and

 
Company will  provide to Bank a certification letter, each quarter, that it is
complying with its obligations under this section.  Bank will comply with any
reporting requirements of the Utah Department of Financial Institutions or the
FDIC applicable to Bank’s performance of this Agreement. The terms of
subsections (b), (f) and (g) of this section 30 shall survive the expiration or
earlier termination of this Agreement.

31.
Prohibition on Tie-In Fees.  Company shall not directly or indirectly impose or
collect any fees, charges or remuneration relating to the processing or approval
of an Application, the establishment of a Loan Account, or the disbursement of
Loan Proceeds, unless such fee, charge or remuneration is set forth in the
Consumer Finance Materials or approved by Bank.

 
32.
Notice of Consumer Complaints and Regulatory Inquiries.  Company shall notify
Bank if it becomes aware of any investigations or proceedings by any state
attorney general, Regulatory Authority, or the Better Business Bureau, or of any
customer complaint that is directed or referred to any state attorney general,
Regulatory Authority, or the Better Business Bureau, relating to any aspect of
the Program within five (5) days of becoming aware of such investigation or
proceeding or complaint, and Company shall provide Bank with all documentation
relating thereto, subject to any legal prohibitions on disclosure of such
investigation or proceeding.  In addition, Company shall provide Bank with
periodic reporting, in a form and on a schedule mutually agreed upon by the
Parties, summarizing customer complaints received by Company and the resolution
thereof by Company.  Company shall cooperate in good faith and provide such
assistance, at Bank’s request, to permit Bank to promptly resolve or address any
investigation, proceeding, or complaint.

 
33.
Headings.  Captions and headings in this Agreement are for convenience only, and
are not to be deemed part of this Agreement.

 
 
20

--------------------------------------------------------------------------------

 
 
34.
Privacy Law Compliance.  Subject to Applicable Laws, Bank and Company shall
comply with the privacy policy agreed upon by both Parties with respect to
Applicants and Borrowers.

 
35.
Manner of Payments.  Unless the manner of payment is expressly provided herein,
all payments under this Agreement shall be made by wire transfer to the bank
accounts designated by the respective Parties.  Notwithstanding anything to the
contrary contained herein, neither Party shall fail to make any payment required
of it under this Agreement as a result of a breach or alleged breach by the
other Party of any of its obligations under this Agreement or any other
agreement, provided that the making of any payment hereunder shall not
constitute a waiver by the Party making the payment of any rights it may have
under the Program Documents or by law.

 
36.
Referrals.  Neither Party has agreed to pay any fee or commission to any agent,
broker, finder, or other person for or on account of such person’s services
rendered in connection with this Agreement that would give rise to any valid
claim against the other Party for any commission, finder’s fee or like payment.

 
37.
Financial Statements.  (a) Within ninety (90) days following the end of
Company’s fiscal year, Company shall deliver to Bank a copy of Company’s audited
financial statements prepared by an independent certified public accountant, and
(b) within forty-five (45) days following the end of each of Company’s fiscal
quarters (other than year-end), Company shall deliver to Bank a copy of
Company’s unaudited financial statements, in each case as of the year or quarter
then ended and prepared in accordance with generally accepted accounting
principles; provided that, as long as Company is required to file periodic
reports under the Securities Exchange Act of 1934, such filings shall satisfy
the financial statement delivery requirements set forth above.  Company shall
also deliver such additional unaudited financial statements and other
information as Bank may request from time to time, within a reasonable period of
time following such request.

 
38.
Information Security.

 
 
(a)
In connection with the Program, Company shall be responsible for maintaining an
information security program that is designed, after consulting with Bank, to:
(i) ensure the security and confidentiality of Applicant or Borrower information
held on behalf of Bank; (ii) protect against any anticipated and emergent
threats or hazards to security or integrity of such information held on behalf
of Bank; (iii) protect against unauthorized access to or use of such information
held on behalf of Bank that could result in substantial harm or inconvenience to
any Applicant or Borrower; and (iv) ensure the proper disposal of customer
information.

 
 
(b)
At least once annually, Company shall conduct an information technology audit
consistent with banking industry practices, which shall include review of
Company’s information security program.  Such audit shall be conducted by a
third-party audit firm that is acceptable to Bank; the scope of each audit shall
be subject to the advance approval of Bank.  Company shall promptly provide a
copy of the audit report.  Company shall promptly take action to correct any
errors or deficiencies identified in any report or audit described in this
Section 38, unless Bank agrees that correction is not required, and shall
develop, with the approval of Bank, a schedule for the correction of such errors
and deficiencies.

 
 
21

--------------------------------------------------------------------------------

 
 
 
(c)
Company shall immediately (and in any event within twenty-four (24) hours after
becoming aware) notify Bank of any actual, suspected or threatened breach in
information security involving personally identifiable information of Applicants
or Borrowers.  In any such event Company agrees that it will fully cooperate
with Bank in investigating any such breach or unauthorized access.  With respect
to any such breach in data security, Company agrees to take action promptly, at
its own expense, to investigate the breach, to identify, mitigate and remediate
the effects of the breach and to implement any other reasonable and appropriate
measures in response to the breach.  Company will also provide Bank with all
available information regarding such breach to assist Bank in implementing its
information security response program and, if applicable, in notifying affected
Applicants or Borrowers.  Company shall pay for the costs of any such
notification, which notification shall be subject to the advance consent of
Bank.

 
39.
Disaster Recovery and Business Continuity.  Company shall maintain a disaster
recovery and business continuity program and related policies acceptable to Bank
(collectively, the “Business Continuity Plans”).  Company agrees that such
Business Continuity Plans shall be at least consistent with industry standards
for the consumer and small business lending industry and in compliance with all
Applicable Laws.  Company shall test its Business Continuity Plans at least once
annually, and shall promptly provide Bank a copy of the report of such tests.

 
 
22

--------------------------------------------------------------------------------

 
 
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed by
their duly authorized officers as of the date first written above.
 
WEBBANK
     
By:
/s/ Kelly M. Barnett   

Name:
Kelly M. Barnett   

Title:
President   

 
PROSPER MARKETPLACE, INC.
     
By:
/s/ Stephan P. Vermut   

Name:
Stephan P. Vermut   

Title:
CEO   

 
 
23

--------------------------------------------------------------------------------

 
 
Schedule 1

I.           Definitions

 
(a)
“ACH” means the Automated Clearinghouse.

 
 
(b)
“Affiliate” means, with respect to a Party, a Person who directly or indirectly
controls, is controlled by or is under common control with the Party.  For the
purpose of this definition, the term “control” (including with correlative
meanings, the terms controlling, controlled by and under common control with)
means the power to direct the management or policies of such Person, directly or
indirectly, through the ownership of twenty-five percent (25%) or more of a
class of voting securities of such Person.

 
 
(c)
“Applicable Laws” means all federal, state and local laws, statutes, regulations
and orders applicable to a Party or relating to or affecting any aspect of the
Program including the Loan Accounts, the Program promotional and marketing
materials and the Consumer Finance Materials, and all requirements of any
Regulatory Authority having jurisdiction over a Party, as any such laws,
statutes, regulations, orders and requirements may be amended and in effect from
time to time during the term of this Agreement.

 
 
(d)
“Applicant” means an individual who is a consumer who requests a Loan Account
from Bank by posting a listing on the Program Website.

 
 
(e)
“Application” means any request from an Applicant for a Loan Account in the form
required by Bank including such requests received through the Program Website.

 
 
(f)
“Bank” shall have the meaning set forth in the introductory paragraph of this
Agreement.

 
 
(g)
“Bank Secrecy Act Policy” shall have the meaning set forth in subsection 5(a).

 
 
(h)
“Borrower” means an Applicant or other Person for whom Bank has established a
Loan Account and/or who is liable, jointly or severally, for amounts owing with
respect to a Loan Account.

 
 
(i)
“Business Day” means any day, other than (i) a Saturday or Sunday, or (ii) a day
on which banking institutions in the State of Utah are authorized or obligated
by law or executive order to be closed.

 
 
(j)
“Change of Control” means (i) an acquisition of Control of Company by any person
or entity, or (ii) the sale by Company of all or substantially all of its assets
to any person or entity.

 
 
(k)
“Claim Notice” shall have the meaning set forth in subsection 9(c).

 
 
(l)
“Confidential Information” means the terms and conditions of this Agreement, and
any proprietary information or non-public information of a Party, including a
Party’s proprietary marketing plans and objectives, that is furnished to the
other Party in connection with this Agreement.

 
 
(m)
“Consumer Finance Materials” shall have the meaning set forth in Section 4.

 
 
 

--------------------------------------------------------------------------------

 
 
 
(n)
“Control” means, with respect to Company, the possession either directly or
indirectly of the power to direct or cause the direction of Company’s management
or policies whether through the ownership of voting securities, by contract or
otherwise.  Such control shall be presumed in the event that a third party
acquires fifty percent (50%) or more of any class of voting securities of
Company.

 
 
(o)
“Credit Policy” means the minimum requirements of income, residency, employment
history, credit history, and/or other such considerations that Bank uses to
approve or deny an Application and to establish a Loan Account.

 
 
(p)
“Disclosing Party” shall have the meaning set forth in subsection 11(b)(2).

 
 
(q)
“Effective Date” shall have the meaning set forth in the introductory paragraph
of this Agreement.

 
 
(r)
“Existing Program Agreement” shall have the meaning set forth in the recitals.

 
 
(s)
“Force Majeure Event” shall have the meaning set forth in Section 27.

 
 
(t)
“Funding Amount” means the aggregate amount, as listed on a Funding Statement,
of all Loan Proceeds to be disbursed by Bank to Borrowers on each Funding Date
and the related Origination Fees.

 
 
(u)
“Funding Date” means the Business Day on which any pending Applications are
approved.

 
 
(v)
“Funding Statement” means the statement prepared by Company on a Business Day
that contains (i) a list of all Applicants who meet the eligibility criteria set
forth in the Credit Policy, for whom Bank is requested to establish Loan
Accounts; and (ii) the computation of the Funding Amount and all information
necessary for the transfer of Loan Proceeds to the accounts designated by the
corresponding Borrowers, including depository institution names, routing numbers
and account numbers, and the transfer of Origination Fees to Company; and
(iii) such other information as shall be reasonably requested by Bank and
mutually agreed to by the Parties.

 
 
(w)
“Indemnifiable Claim” shall have the meaning set forth in subsection 9(b).

 
 
(x)
“Indemnified Parties” shall have the meaning set forth in subsection 9(a).

 
 
(y)
“Insolvent” means the failure to pay debts in the ordinary course of business,
the inability to pay its debts as they come due or the condition whereby the sum
of an entity’s debts is greater than the sum of its assets.

 
 
(z)
“Licensee” shall have the meaning set forth in Section 12.

 
 
(aa)
“Licensing Party” shall have the meaning set forth in Section 12.

 
 
(bb)
“Loan Account” means a consumer installment loan account established by Bank
pursuant to the Program.

 
 
2

--------------------------------------------------------------------------------

 
 
 
(cc)
“Loan Account Agreement” means the document containing the terms and conditions
of a Loan Account including all disclosures required by Applicable Laws.

 
 
(dd)
“Loan Sale Agreement” means that Second Amended and Restated Loan Sale
Agreement, dated as of even date herewith, among Bank, PMI and PFL, pursuant to
which Bank agrees to sell to PMI or PFL, and PMI or PFL agree to purchase from
Bank, the Loan Accounts.

 
 
(ee)
“Loan Proceeds” means the funds disbursed to a Borrower pursuant to a Loan
Account established by Bank under the Program.

 
 
(ff)
“Losses” shall have the meaning set forth in subsection 9(a).

 
 
(gg)
“Marks” shall have the meaning set forth in subsection 12(a).

 
 
(hh)
“Origination Fee” means the up-front fee a Borrower pays to Bank under the Loan
Account Agreement for origination of a Loan Account in the form of a pre-paid
finance charge.

 
 
(ii)
“Party” means either Company or Bank and “Parties” means Company and Bank.

 
 
(jj)
“Person” means any legal person, including any individual, corporation, limited
liability company, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, governmental entity, or other entity of
similar nature.

 
 
(kk)
“PFL” means Prosper Funding LLC, a Delaware limited liability company and a
wholly-owned subsidiary of Company.

 
 
(ll)
“Program” means the installment loan program pursuant to which Bank shall
establish Loan Accounts and disburse Loan Proceeds to Borrowers pursuant to the
terms of this Agreement, initially as described in Exhibit A attached hereto.

 
 
(mm)
“Program Compliance Manual” means the policies and procedures for the
implementation of the Program by Company, including the policies and procedures
regarding the (i) solicitation and receipt of Applications, (ii) underwriting of
Loan Accounts, (iii) processing of Applications, (iv) requirements of the USA
PATRIOT Act Customer Identification Program, and (iv) initial and periodic
Office of Foreign Assets Control screenings.

 
 
(nn)
“Program Documents” means this Agreement, the Loan Sale Agreement, and the Stand
By Loan Purchase Agreement.

 
 
(oo)
“Program Threshold Amount” means [*].

 

--------------------------------------------------------------------------------

* Confidential Treatment Requested
 
 
3

--------------------------------------------------------------------------------

 
 
 
(pp)
“Program Website” means any part of the website located at www.prosper.com,
together with any other website on which the Program is offered to public, that
contains (A) any information directed towards Borrowers or Applicants, (B) any
information about Borrowers or Applicants, or (C) any part of the application
process or information concerning or describing the application process, which
shall be hosted and maintained by Company.

 
 
(qq)
“Proprietary Material” shall have the meaning set forth in subsection 12(a).

 
 
(rr)
“Regulatory Authority” means any federal, state or local regulatory agency or
other governmental agency or authority having jurisdiction over a Party and, in
the case of Bank, shall include, but not be limited to, the Utah Department of
Financial Institutions and the Federal Deposit Insurance Corporation.

 
 
(ss)
“Restricted Party” shall have the meaning set forth in subsection 11(a).

 
 
(tt)
“Stand By Loan Purchase Agreement” means that Stand By Loan Purchase Agreement,
dated as of even date herewith, between the Parties.

 
 
(uu)
“Trigger Event” shall have the meaning set forth in subsection 10(c).

 
II.           Construction

As used in this Agreement:

 
(a)
All references to the masculine gender shall include the feminine gender (and
vice versa);

 
(b)
All references to “include,” “includes,” or “including” shall be deemed to be
followed by the words “without limitation”;

 
(c)
References to any law or regulation refer to that law or regulation as amended
from time to time and include any successor law or regulation;

 
(d)
References to “dollars” or “$” shall be to United States dollars unless
otherwise specified herein;

 
(e)
Unless otherwise specified, all references to days, months or years shall be
deemed to be preceded by the word “calendar”;

 
(f)
All references to “quarter” shall be deemed to mean calendar quarter; and

 
(g)
The fact that Bank or Company has provided approval or consent shall not mean or
otherwise be construed to mean that: (i) either Party has performed any due
diligence with respect to the requested or required approval or consent, as
applicable; (ii) either Party agrees that the item or information for which the
other Party seeks approval or consent complies with any Applicable Laws; (iii)
either Party has assumed the other Party’s obligations to comply with all
Applicable Laws arising from or related to any requested or required approval or
consent; or (iv) except as otherwise expressly set forth in such approval or
consent, either Party’s approval or consent impairs in any way the other Party’s
rights or remedies under the Agreement, including indemnification rights for
Company’s failure to comply with all Applicable Laws.

 
4

--------------------------------------------------------------------------------

 
 
Schedule 7(b)(4)

Litigation

On November 26, 2008, plaintiffs, Christian Hellum, William Barnwell and David
Booth, individually and on behalf of all other plaintiffs similarly situated,
filed a class action lawsuit against PMI and certain of its executive officers
and directors in the Superior Court of California, County of San Francisco,
California.  The suit was brought on behalf of all persons who had purchased
loan notes through PMI’s platform from January 1, 2006 through October 14,
2008.  The lawsuit alleges that PMI offered and sold unqualified and
unregistered securities in violation of the California and federal securities
laws.  The lawsuit seeks damages and the right of rescission against PMI and the
other named defendants, as well as treble damages against PMI and the award of
attorneys’ fees, experts’ fees and costs, and pre-judgment and post-judgment
interest.

On February 25, 2011, the plaintiffs filed a Third Amended Complaint, which
removed David Booth as a plaintiff and added Brian Russom and Michael Del Greco
as plaintiffs.  The new plaintiffs are representing the same putative class and
prosecuting the same claims as the previously named plaintiffs. On February 29,
2012, the court granted the plaintiffs’ motion for class certification. 

PMI’s insurance carrier with respect to the class action lawsuit, Greenwich
Insurance Company (“Greenwich”), denied coverage.  On August 21, 2009, PMI filed
suit against Greenwich in the Superior Court of California, County of San
Francisco, California.  The lawsuit sought a declaration that PMI was entitled
to coverage under its policy with Greenwich for losses arising out of the class
action lawsuit as well as damages and the award of attorneys’ fees and pre- and
post-judgment interest.

On January 26, 2011, the court issued a final statement of decision finding that
Greenwich has a duty to defend the class action lawsuit, and requiring that
Greenwich pay PMI's past and future defense costs in the class action suit up to
$2 million.  Greenwich subsequently made payments to PMI in the amount of $2
million to reimburse PMI for the defense costs it had incurred in the class
action suit.  As a result, Greenwich has now satisfied its obligations with
respect to PMI’s defense costs for the Hellum suit, with the exception of
$142,584 in pre-judgment interest that Greenwich will be required to pay to PMI
when a final judgment has been entered in the suit and all appeals have been
exhausted.   

On July 1, 2011, PMI and Greenwich entered into a Stipulated Order of Judgment
pursuant to which PMI agreed to dismiss its remaining claims against
Greenwich.  On August 12, 2011, Greenwich filed a notice of appeal of the
court's decision regarding Greenwich’s duty to defend up to $2 million. On July
16, 2012, the California Court of Appeal affirmed the trial court’s decision.
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit A

The Program Website
(screen shots of each page of the Program Website)
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit B

Credit Policy
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit C

Form of Application
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit D

Loan Account Documentation
 
 
 

--------------------------------------------------------------------------------

 
Exhibit E

Sample Funding Statement
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit F

Insurance Requirements
 
(a)           From the Effective Date and until termination of this Agreement,
Company shall maintain insurance of the following kinds and amounts, or in
amounts required by Applicable Laws, whichever is greater.
 
(i)           A blanket fidelity bond and an errors and omissions insurance
policy, with broad coverage on all officers and employees acting in any capacity
with regard to handling funds, money, or documents.  The fidelity bond and
errors and omissions insurance shall be in a form reasonably acceptable to Bank
and shall protect and insure against losses, including forgery, theft,
embezzlement, fraud, errors and omissions and negligent acts of such
persons.  No provision of this paragraph requiring the fidelity bond and errors
and omissions insurance shall diminish or relieve Company from its duties and
obligations as set forth in this Agreement.  The minimum coverage under any such
bond and insurance policy shall be at least [*], with the exception of [*]
minimum coverage for forgery.
 
(ii)           Commercial general liability insurance written on an occurrence
basis against claims on account of bodily injury, death or property
damage.  Such insurance shall have a combined single limit of not less than [*]
per occurrence and [*] annual aggregate for bodily injury, death and property
damage.
 
(iii)           Worker’s Compensation and employers’ liability insurance
affording (A) protection under the Worker’s Compensation Law containing an all
states endorsement and (B) Employers’ Liability Protection subject to a limit of
not less than [*].
 
(iv)           Upon reasonable request by Bank, such other insurance as may be
maintained by Persons engaged in the same or similar business and similarly
situated.
 
(b)            Insurance policies required to be maintained hereunder shall be
procured from insurance companies reasonably acceptable to Bank.  Liability
insurance limits may be provided through any combination of primary and/or
excess insurance policies.  If requested by Bank, Company shall cause to be
delivered to Bank annually a certified true copy of each fidelity bond and
insurance policy required under this Agreement.
 

--------------------------------------------------------------------------------

* Confidential Treatment Requested
 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit G

Program Compliance Manual
 
 
 

--------------------------------------------------------------------------------

 

Exhibit H

Third-Party Service Contractors

Third-Party Service Contractor
 
Service Provided

 
 
 

--------------------------------------------------------------------------------

 
 
Exhibit I

Bank Secrecy Act Policy

--------------------------------------------------------------------------------