New York Fed Revises TALF Master Loan and Security Agreement

March 11, 2009

The following highlights some of the key changes made to the MLSA from the March 3 posting:
  • Provides for a five business day grace period for collateral enforcement events described in clause (ii) (failure to perform obligations, other than payment obligations) and clause (vi) (encumbrances on Collateral).

  • Eliminates the obligation to provide substitute collateral or prepay the applicable Loan in the event that Collateral is found to be (or to have become) ineligible, and adds a knowledge qualifier to the Borrower’s Eligible Collateral representation (on the basis of such Borrower’s review of the Offering Materials). Breach of this representation remains a recourse trigger.

  • Clarifies that, with respect to SBA Collateral, the standard form of Auditor Attestation and Indemnity Undertaking need not be delivered; rather, an SBA Collateral Undertaking must be delivered (other than with respect to Development Company Participation Certificates).

  • Confirms that if a Loan fails to close, the Haircut Amount, Other Closing Amounts and, if all closing conditions (including delivery of the Collateral) had been satisfied, the Administrative Fee will be refunded.

  • Deletes the accrual of interest on Monthly Interest Shortfall Amounts.

  • Clarifies that the Borrower makes an Eligible Borrower representation each time it receives a Loan (which representation continues during the life of the Loan), and that the accuracy of such representation is determined on the basis of the eligibility criteria in effect on the date such Loan is made.

  • Clarifies that the Lender’s inspection rights with respect to a Borrower relate to that Borrower’s Loan, Collateral and obligations under the Lending Agreement

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View MLSA pdf