Scope of Services: Loan Operations - Full-Service
Service | Carta responsibilities | Client responsibilities |
Source data collection | Capturing significant loan terms for each loan in a lender’s portfolio, as described in specified material loan documentation, as well as incorporating relevant modifications of such terms in loan operations software platform | Provide Carta with complete material loan agreements and documentation, for each loan to be tracked as well as any future modifications to such documentation. |
Certify Carta’s right to use data and grant or assure Carta has relevant servicing rights necessary to effect scoped services. Provide relevant contact information for counterparties. | ||
Covenant Reporting | Monitor and verify relevant counterparty’s compliance with specified financial covenants, based solely on data provided by client, and notifying client of potential unremediated breaches or defaults. Track history of financial covenant compliance in periodic monthly reports. | Provide Carta with relevant periodic data for calculation of quantitative financial covenants. Client will ultimately determine if/when to trigger a covenant default or cure period and if/when to provide any necessary notices, subject to the terms of the credit agreement or other lending document. |
Interest Calculation/ Reporting | Monthly/quarterly reporting of interest payments, financial performance, and covenant compliance status. | |
Use loan operations software to generate and send payment requirement notifications to borrowers, tracking payments, and reconciling cash flows. Notifications to lenders for missing/incorrect payments. | Client will ultimately determine if/when an interest payment is due and if such payment is made on time, subject to the terms of the credit agreement or other lending document | |
Transferring interest accrual data from loan operations platform to corresponding loans on Carta. | Client to provide banking feed or transaction reports to allow reconciliation. | |
Client Portals | Carta to provide read-only access to loan operations platform for loan information for relevant lenders. | Client to provide relevant documentation to loan operations software platform for lender permissioning and onboarding. |
Carta to provide relevant borrowers read-only access to loan operations borrower portal. | Client to provide relevant documentation to loan operations for borrower permissioning and onboarding. |
Borrowers will be responsible for updating their information, including maintaining investor contact preferences and other requested information on the loan operations borrower platform.
All communications with lenders and borrowers will be via the loan operations platform, which will serve as the communication repository for notices, reports and calculations.
Carta will prepare reports regarding covenants based on information provided by Client. When making calculations of amounts payable, interest accrued or any calculation in connection with covenant reporting, Carta will rely on the completeness and accuracy of the materials and information provided by or on behalf of Client, and Client represents and warrants that the information provided to Carta is true and correct.
Client confirms and covenants that any loan subject to Carta operations does not and will not constitute “plan assets” subject to Title I of the Employee Retirement Income Security Act of 1974, as amended or Section 4975 of the Internal Revenue Code of 1986, as amended.
Client confirms that no loan subject to operations services is or is constituted from residential mortgages or other real property. For the avoidance of doubt, Carta is not licensed as a mortgage servicer in any jurisdiction, including under the SAFE Mortgage Licensing Act of 2008 or under any US state law and provides no services requiring such license or registration.
Client acknowledges that: (a) Client is solely responsible for the accuracy of the information provided by Client, and (b) Carta will not independently verify any information provided.
Client is responsible for determining any responsibility for AML/KYC compliance in connection with loan payments or otherwise. Contact your Carta representative to engage separate AML/KYC services for an additional fee.
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DISCLOSURE: This communication is on behalf of eShares, Inc. dba Carta, Inc. ("Carta"). This communication is not to be construed as legal, financial, accounting, or tax advice and is for informational purposes only. This communication is not intended as a recommendation, offer, or solicitation for the purchase or sale of any security. Carta does not assume any liability for reliance on the information provided herein.
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