TERMINATION AGREEMENT

THIS TERMINATION AGREEMENT, dated as of September 21, 2009 (this 

“Agreement”), is entered into by and among BANK OF AMERICA CORPORATION (“Bank of 

America”), the UNITED STATES DEPARTMENT OF THE TREASURY (“UST”), the BOARD OF 

GOVERNORS OF THE FEDERAL RESERVE SYSTEM, ON ITS OWN BEHALF AND ON BEHALF 

OF THE FEDERAL RESERVE SYSTEM (“Federal Reserve”), and the FEDERAL DEPOSIT 

INSURANCE CORP. (“FDIC,” and together with UST and Federal Reserve, the “USG Parties”). 

W I T N E S S E T H :

WHEREAS, the parties hereto are parties to the Summary of Terms (the “Term Sheet”) 

dated as of January 15, 2009 pursuant to which the USG Parties agreed to guarantee or lend against a pool 

of up to $118,000,000,000 of financial instruments consisting of securities backed by residential and 

commercial real estate loans and corporate debt, and related derivatives (the “Pool”); 

WHEREAS, during negotiations subsequent to the signing of the Term Sheet, the parties 

hereto agreed that the Pool would be reduced to approximately $104,000,000,000 and were also 

discussing and had not reached agreement with respect to the eligibility criteria for losses on certain types 

of assets; 

WHEREAS, although the parties never entered into definitive documentation for the 

transaction, Bank of America received value from the Term Sheet including, without limitation: (i) the 

representation of the USG Parties that they would guarantee and share losses on the Pool from and after 

the date of the Term Sheet and (ii) the benefits that entering into the Term Sheet had for market 

confidence in Bank of America after the date of the Term Sheet; 

WHEREAS, on May 6, 2009, Bank of America notified the USG Parties of its desire to 

terminate negotiations with respect to the guarantee contemplated by the Term Sheet; 

WHEREAS, the Term Sheet provided that Bank of America may terminate the guarantee 

contemplated by the Term Sheet at any time, with the consent of the USG Parties, and that the parties 

would negotiate in good faith an appropriate fee or rebate in connection with any permitted termination; 

and 

WHEREAS, the parties hereto agree that it is appropriate for the USG Parties to be 

compensated by Bank of America for their willingness to bear the risk of loss on the Pool during the 

period from the date of the Term Sheet to May 6, 2009 (such period, the “Pro-Rated Guarantee Period”); 

WHEREAS, the parties hereto agree that the appropriate compensation to the USG 

Parties should consist of: (i) the out-of-pocket expenses of the USG Parties in connection with negotiating 

and entering into the Term Sheet and the negotiations concerning the definitive documentation and (ii) an 

amount equal to the fees that Bank of America would have otherwise paid for the guarantee as adjusted to 

reflect (x) the downsizing of the Pool and the uncertainties regarding coverage of certain types of losses at 

the time negotiations were terminated by Bank of America and (y) the proportion that the Pro-Rated 

Guarantee Period bears to the original term of the guarantee; 

NOW, THEREFORE, in consideration of the mutual promises and agreements herein 

made and intending to be legally bound hereby, the parties hereto agree as follows: 
1. Termination Payment. (a) In connection with the termination of the guarantee 

contemplated by the Term Sheet, Bank of America hereby agrees to pay (i) $276,000,000 to UST, (ii) 

$57,000,000 to Federal Reserve and (iii) $92,000,000 to FDIC (such payments, collectively, the 

“Termination Fee”), in cash in immediately available funds, within three business days of the date hereof. 

(b) The parties agree that the Termination Fee has been calculated as the sum of: (i) the 

out-of-pocket expenses of the USG Parties in negotiating and entering into the Term Sheet and the 

negotiations concerning the definitive documentation, consisting of the expenses of its advisors, and (ii) 

an amount equal to the fees that Bank of America would have otherwise paid for the guarantee as adjusted 

to reflect (x) the downsizing of the Pool and the uncertainties regarding coverage of certain types of 

losses at the time negotiations were terminated by Bank of America and (y) the proportion that the ProRated Guarantee Period bears to the original term of the guarantee. The calculation of the Termination 

Fee is set forth on Schedule A hereto. 

2. Termination of Term Sheet. The parties hereto hereby agree to terminate the 

Term Sheet effective upon the receipt of the payments specified in Section 1. 

3. Release. (a) The parties acknowledge and agree that, upon the payment in full of 

all amounts specified in Section 1, (i) Bank of America releases, discharges and acquits each of the USG 

Parties from all Released Claims (as defined below), except for the rights and obligations under this 

Agreement and (ii) the USG Parties release, discharge and acquit Bank of America from all Released 

Claims, except for the rights and obligations under this Agreement. 

(b) Released Claims. “Released Claims” means all claims between the USG Parties, 

on the one hand, and Bank of America, on the other hand, including but not limited to claims, demands, 

obligations, liabilities, cause or causes of action (whether at law or in equity), whensoever arising and 

occurring at any time up to and through the date hereof, whether known or unknown, suspected or 

unsuspected, liquidated or unliquidated, matured or unmatured, fixed or contingent, that arise out of or 

relate to the Term Sheet and the guarantee contemplated thereby. 

4. Entire Agreement; Amendment. This Agreement constitutes the entire agreement 

between the parties hereto with respect to the subject matter hereof, and supersedes any prior oral or 

written agreements, commitments or understanding with respect to the matters provided for herein. No 

amendment, modification or discharge of this Agreement shall be valid or binding unless set forth in 

writing and duly executed by the party against whom enforcement of the amendment, modification, or 

discharge was sought. 

5. Execution of Counterparts. To facilitate execution, this Agreement may be 

executed in as many counterparts as may be required; and it shall not be necessary that the signatures of, 

or on behalf of, each party, or that the signatures of all persons required to bind any party, appear on each 

counterpart; but it shall be sufficient that all such signatures appear on one or more of the counterparts. 

All counterparts shall collectively constitute a single agreement. It shall not be necessary in making proof 

of this Agreement to produce or account for more than a number of counterparts containing the respective 

signatures of, or on behalf of, all of the parties hereto. 

6. Governing Law. THIS AGREEMENT, AND THE RIGHTS AND 

OBLIGATIONS OF THE PARTIES HEREUNDER, SHALL BE GOVERNED BY, AND 

CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, FEDERAL LAW AND NOT THE 

LAW OF ANY STATE OR LOCALITY. TO THE EXTENT THAT A COURT LOOKS TO THE 

LAWS OF ANY STATE TO DETERMINE OR DEFINE THE FEDERAL LAW, IT IS THE 

INTENTION OF THE PARTIES HERETO THAT SUCH COURT SHALL LOOK ONLY TO THE 
LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE RULES OF CONFLICTS OF 

LAWS. 


IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their 

respective duly authorized officers as of the day and year first above written. 

BANK OF AMERlCA CORPORATION 

Name: 

Title: 

THE UNITED STATES DEPARTMENT OF THE 

TREASURY 

Name: 

Title: 

BOARD OF GOVERNORS OF THE FEDERAL 

RESERVE SYSTEM 

FEDERAL DEPOSIT INSURANCE CORP. 

Name: 

Title: 
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their

respective duly authorized offcers as of the day and year first above written.

BANK OF AMERICA CORPORATION

By:

Name:

Title:

THE UNITED STATES DEPARTMENT OF THE

TREASURY

By:

Name:

Title:

BOARD OF GOVERNORS OF THE FEDERAL

RESERVE SYSTEM

By:

Name:

Title:

FEDERAL DEPOSIT INSURANCE CORP.

Nam~: Steven o. App ~ By:~Ð.~

Title: Deputy to the Chairman and CFO
Calculation of Termination Fee Schedule A

($ in millons, unless otherwise noted)

Summary of Total Fee Fed Treasury FDIC

(1) Foregone Dividends $69 - 52 17 

(2) Pro-rated Premium 159 - 119 40 

(3) Warrants Valuation 140 - 105 35 

(4) Fed Commitment Fee plus expenses 57 57 - - 

Total Termination Fee $425 57 276 92 

Key Assumptions

Date of Guarantee Announcement 1/16/2009

Date of BAC Request to Terminate 5/6/2009

Guarantee Period (days) 110

Years (360 day year) 0.3

Original Asset Pool ($ in billions) 118

Reduced Asset Pool after initial exclusions ($ bn) 104

Assets Subject to Disagreement re Definition of Eligible Losses ($ bn) 42

Adjustment Factor Factor on Assets Subject to Disagreement 50%

Asset Pool after Additional Exclusions ($ bn) 83

Pool Exclusion Adjustment Factor 70%

Amount of Pool with 10 year Guarantee ($ bn) 7 

Average Life of the Guarantee (years) 5.4 

(1) Dividends for 4 Months

UST/FDIC Preferred Stock Dividend Rate 8.0%

Face Amount of Preferred Stock $4,000

Annual Dividend $320

Adjusted for Reduced Size of the Asset Pool $225

Pro-rated for Guarantee Period $69

(2) Premium Pro-rated for 4 months

Premium (Preferred Stock) $4,000

Average Life of Guarantee (years)* 5.4 

Annual Premium $738

Adjusted for Reduced Size of the Asset Pool $519

Pro-rated for Guarantee Period $159

(3) Warrants**

10% of $4,000 Premium $400

Strike Price (not in millions)*** $13.30

Number of Warrants 30.1

Estimated Value 200 

Adjusted for Reduced Size of the Asset Pool $140
Calculation of Termination Fee Schedule A

($ in millons, unless otherwise noted)

(4) Fed Commitment Fee

Fed Commitment Fee Rate 0.20%

Coverage of Fed Guarantee ($ bn) 83 

less BofA Deductible ($ bn) (10) 

less UST/FDIC first loss ($ bn) (10) 

less fist loss sharing of BAC ($ bn) (1) 

Remaining Fed loss sharing percentage 90%

Net Fed Loan Coverage ($ bn) 56 

Annualized Fee 111 

Pro-rated Fee (110 days) 34

Plus Expenses 23 

Total Fed Termination Fee $57