Prohibited Transaction Exemption 2008-06; Grant of Individual Exemptions involving D-11369, The Swedish Health Services Pension Plan; D-11434, Credit Suisse (CS) and Its Current and Future Affiliates; and D-11446, Amendment to Prohibited Transaction Exemption (PTE) 93-31, PTE 97-34, PTE 2002-41, PTE 2007-05, involving Bank of America, N.A., the Successor of NationsBank Corporation, 27564-27578 [E8-10631]

Agencies

• DEPARTMENT OF LABOR
• Pension and Welfare Benefits Administration

[Federal Register Volume 73, Number 93 (Tuesday, May 13, 2008)]
[Notices]
[Pages 27564-27578]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-10631]


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DEPARTMENT OF LABOR

Pension and Welfare Benefits Administration

[Exemption Application No. D-11369, D-11434 & D-11446]


Prohibited Transaction Exemption 2008-06; Grant of Individual 
Exemptions involving D-11369, The Swedish Health Services Pension Plan; 
D-11434, Credit Suisse (CS) and Its Current and Future Affiliates; and 
D-11446, Amendment to Prohibited Transaction Exemption (PTE) 93-31, PTE 
97-34, PTE 2002-41, PTE 2007-05, involving Bank of America, N.A., the 
Successor of NationsBank Corporation

AGENCY: Employee Benefits Security Administration, Labor.

ACTION: Grant of Individual Exemption.

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SUMMARY: This document contains an exemption issued by the Department 
of Labor (the Department) from certain of the prohibited transaction 
restrictions of the Employee Retirement Income Security Act of 1974 
(the Act) and/or the Internal Revenue Code of 1986 (the Code).
    A notice was published in the Federal Register of the pendency 
before the Department of a proposal to grant such exemption. The notice 
set forth a summary of facts and representations contained in the 
application for exemption and referred interested persons to the 
application for a complete statement of the facts and representations. 
The application has been available for public inspection at the 
Department in Washington, DC. The notice also invited interested 
persons to submit comments on the requested exemption to the 
Department. In addition the notice stated that any interested person 
might submit a written request that a public hearing be held (where 
appropriate). The applicant has represented that it has complied with 
the requirements of the notification to interested persons. No requests 
for a hearing were received by the Department. Public comments were 
received by the Department as described in the granted exemption.
    The notice of proposed exemption was issued and the exemption is 
being granted solely by the Department because, effective December 31, 
1978, Section 102 of Reorganization Plan No. 4 of 1978, 5 U.S.C. App. 1 
(1996), transferred the authority of the Secretary of the Treasury to 
issue exemptions of the type proposed to the Secretary of Labor.

Statutory Findings

    In accordance with section 408(a) of the Act and/or section 
4975(c)(2) of the Code and the procedures set forth in 29 CFR part 
2570, subpart B (55 FR 32836, 32847, August 10, 1990) and based upon 
the entire record, the Department makes the following findings:
    (a) The exemption is administratively feasible;
    (b) The exemption is in the interests of the plan and its 
participants and beneficiaries; and
    (c) The exemption is protective of the rights of the participants 
and beneficiaries of the plan.

The Swedish Health Services Pension Plan (the Plan), Located in 
Seattle, Washington

[Prohibited Transaction Exemption 2008-06; Exemption Application No. D-
11369].

Exemption

    The restrictions of sections 406(a)(1)(A), 406(b)(1) and (b)(2) of 
the Act and the sanctions resulting from the application of Section 
4975 of the Code, by reason of section 4975(c)(1)(A) through (E) of the 
Code, shall not apply effective April 14, 2005, to two contributions 
in-kind (the Contribution(s)) to the Plan of securities (the 
Securities) made on April 14th and 15th 2005 by Swedish Health Services 
(the Applicant), the Plan sponsor, a party in interest with respect to 
the Plan, provided that the following conditions were satisfied:
    (a) The Securities were valued at their fair market value at the 
time of each Contribution;
    (b) The Contributions represented no more than 20% of the total 
assets of the Plan;
    (c) The Plan has not paid any commissions, costs or other expenses 
in connection with the Contributions;
    (d) The Contributions represented a contribution in lieu of cash to 
the Plan to meet ERISA filing requirements;
    (e) The Contributions were based on publicly traded closing prices 
of the Securities on the date of the transfer; and
    (f) The terms of the Contributions between the Plan and the 
Applicant were no less favorable to the Plan than terms negotiated at 
arm's length under similar circumstances between unrelated third 
parties.

[[Page 27565]]


DATES: Effective Date: This exemption is effective as of April 14, 
2005.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption, refer to 
the Notice of Proposed Exemption (the Notice) published on June 1, 
2007, at 72 FR 30634.
    Written Comments: Subsequent to the publication of the Notice, the 
Service Employees International Union District 1199 NW (SEIU) 
transmitted a letter to the Applicant on July 25, 2007. Certain 
participants in the Plan are represented by SEIU. The collective 
bargaining agreement between the Applicant and SEIU requires the 
Applicant to maintain the Plan for certain employees represented by 
SEIU. In this letter, SEIU requested that the Applicant obtain a 
statement from each of the Plan's investment managers who had selected 
certain securities that were transferred from the Applicant's business 
account to the Plan's trust account in connection with the transaction 
for which relief has been requested. The requested statements involved 
responses to the following questions: (1) A description of each of the 
securities; (2) a statement from the investment manager that all these 
securities meet the investment policy and guidelines under which it 
manages assets for the Plan; (3) a statement from the investment 
manager that in its capacity as a fiduciary to the Plan, it would have 
purchased these same securities in the open market had the opportunity 
to acquire them from Swedish's business account not presented itself 
and that the terms of each transaction were equivalent or more 
favorable than those available in the open market; (4) a statement that 
none of the securities included collateralized debt obligations, 
collateralized loan obligations, other asset backed securities, such as 
sub-prime mortgages, or other derivatives that are backed by below-
investment grade securities; (5) a statement that conditions (a), (c) 
and (e) in the Notice were met.
    Stoel Rives LLP (Stoel Rives), the law firm that represents the 
Plan and the Applicant in this matter, hired AON Consulting (AON) in 
order to assist in gathering responses from the investment managers to 
the foregoing questions. Pursuant to the direction of Stoel Rives, AON 
sent a report to the Department dated October 24, 2007, which contained 
responses from the investment managers to the aforementioned questions. 
Based upon the responses to the questions, the Department has 
determined to finalize the exemption as proposed.
    The Department also received numerous telephone calls and a number 
of written comments from interested persons concerning the Notice. All 
of the telephone calls and comments requested additional information 
regarding the possible effect the Contributions would have on benefits 
payable to the appropriate Plan participants. The Department responded 
to each inquiry by telephone and attempted to answer all questions 
directly relating to the transaction at issue. None of the commenters 
offered any information regarding the substance of the subject 
transactions.
    Based on the entire record the Department has determined to grant 
the exemption as proposed.

For Further Information Contact: Brian Buyniski of the Department, 
telephone (202) 693-8545 (this is not a toll-free number).

Credit Suisse (CS) and Its Current and Future Affiliates (Collectively, 
the Applicant) Located in Zurich, Switzerland, With Offices Around the 
World

[Prohibited Transaction Exemption 2008-07; Exemption Application No. D-
11434]

Exemption

Section I--Transactions

    The restrictions of section 406 of the Act and the sanctions 
resulting from the application of section 4975 of the Code, by reason 
of section 4975(c)(1)(A) through (F) of the Code, shall not apply to 
the purchase of certain securities (the Securities), as defined, below 
in Section III(h), by an asset management affiliate of CS, as 
``affiliate'' is defined, below, in Section III(c), from any person 
other than such asset management affiliate of CS or any affiliate 
thereof, during the existence of an underwriting or selling syndicate 
with respect to such Securities, where a broker-dealer affiliated with 
CS (the Affiliated Broker-Dealer), as defined, below, in Section 
III(b), is a manager or member of such syndicate and the asset 
management affiliate of CS purchases such Securities, as a fiduciary:
    (a) On behalf of an employee benefit plan or employee benefit plans 
(Client Plan(s)), as defined, below, in Section III(e); or
    (b) On behalf of Client Plans, and/or In-House Plans, as defined, 
below, in Section III(l), which are invested in a pooled fund or in 
pooled funds (Pooled Fund(s)), as defined, below, in Section III(f); 
provided that the conditions as set forth, below, in Section II, are 
satisfied (an affiliated underwriter transaction (AUT)).\1\
---------------------------------------------------------------------------

    \1\ For purposes of this exemption an In-House Plan may engage 
in AUTs only through investment in a Pooled Fund.
---------------------------------------------------------------------------

Section II--Conditions

    The exemption is conditioned upon adherence to the material facts 
and representations described herein and upon satisfaction of the 
following requirements:
    (a)(1) The Securities to be purchased are either--
    (i) Part of an issue registered under the Securities Act of 1933 
(the 1933 Act) (15 U.S.C. 77a et seq.). If the Securities to be 
purchased are part of an issue that is exempt from such registration 
requirement, such Securities:
    (A) Are issued or guaranteed by the United States or by any person 
controlled or supervised by and acting as an instrumentality of the 
United States pursuant to authority granted by the Congress of the 
United States,
    (B) Are issued by a bank,
    (C) Are exempt from such registration requirement pursuant to a 
federal statute other than the 1933 Act, or
    (D) Are the subject of a distribution and are of a class which is 
required to be registered under section 12 of the Securities Exchange 
Act of 1934 (the 1934 Act) (15 U.S.C. 781), and are issued by an issuer 
that has been subject to the reporting requirements of section 13 of 
the 1934 Act (15 U.S.C. 78m) for a period of at least ninety (90) days 
immediately preceding the sale of such Securities and that has filed 
all reports required to be filed thereunder with the Securities and 
Exchange Commission (SEC) during the preceding twelve (12) months; or
    (ii) Part of an issue that is an Eligible Rule 144A Offering, as 
defined in SEC Rule 10f-3 (17 CFR 270.10f-3(a)(4)). Where the Eligible 
Rule 144A Offering of the Securities is of equity securities, the 
offering syndicate shall obtain a legal opinion regarding the adequacy 
of the disclosure in the offering memorandum;
    (2) The Securities to be purchased are purchased prior to the end 
of the first day on which any sales are made, pursuant to that 
offering, at a price that is not more than the price paid by each other 
purchaser of the Securities in that offering or in any concurrent 
offering of the Securities, except that--
    (i) If such Securities are offered for subscription upon exercise 
of rights, they may be purchased on or before the fourth day preceding 
the day on which the rights offering terminates; or
    (ii) If such Securities are debt securities, they may be purchased 
at a

[[Page 27566]]

price that is not more than the price paid by each other purchaser of 
the Securities in that offering or in any concurrent offering of the 
Securities and may be purchased on a day subsequent to the end of the 
first day on which any sales are made, pursuant to that offering, 
provided that the interest rates, as of the date of such purchase, on 
comparable debt securities offered to the public subsequent to the end 
of the first day on which any sales are made and prior to the purchase 
date are less than the interest rate of the debt Securities being 
purchased; and
    (3) The Securities to be purchased are offered pursuant to an 
underwriting or selling agreement under which the members of the 
syndicate are committed to purchase all of the Securities being 
offered, except if--
    (i) Such Securities are purchased by others pursuant to a rights 
offering; or
    (ii) Such Securities are offered pursuant to an over-allotment 
option.
    (b) The issuer of the Securities to be purchased pursuant to this 
exemption must have been in continuous operation for not less than 
three years, including the operation of any predecessors, unless the 
Securities to be purchased are--
    (1) Non-convertible debt securities rated in one of the four 
highest rating categories by Standard & Poor's Rating Services, Moody's 
Investors Service, Inc., FitchRatings, Inc., Dominion Bond Rating 
Service Limited, Dominion Bond Rating Service, Inc., or any successors 
thereto (collectively, the Rating Organizations), provided that none of 
the Rating Organizations rates such Securities in a category lower than 
the fourth highest rating category; or
    (2) Debt securities issued or fully guaranteed by the United States 
or by any person controlled or supervised by and acting as an 
instrumentality of the United States pursuant to authority granted by 
the Congress of the United States; or
    (3) Debt securities which are fully guaranteed by a person (the 
Guarantor) that has been in continuous operation for not less than 
three years, including the operation of any predecessors, provided that 
such Guarantor has issued other securities registered under the 1933 
Act; or if such Guarantor has issued other securities which are exempt 
from such registration requirement, such Guarantor has been in 
continuous operation for not less than three years, including the 
operation of any predecessors, and such Guarantor is:
    (a) A bank; or
    (b) An issuer of securities which are exempt from such registration 
requirement, pursuant to a Federal statute other than the 1933 Act; or
    (c) An issuer of securities that are the subject of a distribution 
and are of a class which is required to be registered under section 12 
of the 1934 Act (15 U.S.C. 781), and are issued by an issuer that has 
been subject to the reporting requirements of section 13 of the 1934 
Act (15 U.S.C. 78m) for a period of at least ninety (90) days 
immediately preceding the sale of such securities and that has filed 
all reports required to be filed thereunder with the SEC during the 
preceding twelve (12) months.
    (c) The aggregate amount of Securities of an issue purchased, 
pursuant to this exemption, by the asset management affiliate of CS 
with: (i) The assets of all Client Plans; and (ii) The assets, 
calculated on a pro-rata basis, of all Client Plans and In-House Plans 
investing in Pooled Funds managed by the asset management affiliate of 
CS; and (iii) The assets of plans to which the asset management 
affiliate of CS renders investment advice within the meaning of 29 CFR 
2510.3-21(c) does not exceed:
    (1) Ten percent (10%) of the total amount of the Securities being 
offered in an issue, if such Securities are equity securities;
    (2) Thirty-five percent (35%) of the total amount of the Securities 
being offered in an issue, if such Securities are debt securities rated 
in one of the four highest rating categories by at least one of the 
Rating Organizations, provided that none of the Rating Organizations 
rates such Securities in a category lower than the fourth highest 
rating category; or
    (3) Twenty-five percent (25%) of the total amount of the Securities 
being offered in an issue, if such Securities are debt securities rated 
in the fifth or sixth highest rating categories by at least one of the 
Rating Organizations; provided that none of the Rating Organizations 
rates such Securities in a category lower than the sixth highest rating 
category; and
    (4) The assets of any single Client Plan (and the assets of any 
Client Plans and any In-House Plans investing in Pooled Funds) may not 
be used to purchase any Securities being offered, if such Securities 
are debt securities rated lower than the sixth highest rating category 
by any of the Rating Organizations;
    (5) Notwithstanding the percentage of Securities of an issue 
permitted to be acquired, as set forth in Section II(c) (1), (2), and 
(3), above, of this exemption, the amount of Securities in any issue 
(whether equity or debt securities) purchased, pursuant to this 
exemption, by the asset management affiliate of CS on behalf of any 
single Client Plan, either individually or through investment, 
calculated on a pro-rata basis, in a Pooled Fund may not exceed three 
percent (3%) of the total amount of such Securities being offered in 
such issue, and;
    (6) If purchased in an Eligible Rule 144A Offering, the total 
amount of the Securities being offered for purposes of determining the 
percentages, described, above, in Section II(c)(1)-(3) and (5), is the 
total of:
    (i) The principal amount of the offering of such class of 
Securities sold by underwriters or members of the selling syndicate to 
``qualified institutional buyers'' (QIBs), as defined in SEC Rule 144A 
(17 CFR 230.144A(a)(1)); plus
    (ii) The principal amount of the offering of such class of 
Securities in any concurrent public offering.
    (d) The aggregate amount to be paid by any single Client Plan in 
purchasing any Securities which are the subject of this exemption, 
including any amounts paid by any Client Plan or In-House Plan in 
purchasing such Securities through a Pooled Fund, calculated on a pro-
rata basis, does not exceed three percent (3%) of the fair market value 
of the net assets of such Client Plan or In-House Plan, as of the last 
day of the most recent fiscal quarter of such Client Plan or In-House 
Plan prior to such transaction.
    (e) The covered transactions are not part of an agreement, 
arrangement, or understanding designed to benefit the asset management 
affiliate of CS or an affiliate.
    (f) The Affiliated Broker-Dealer does not receive, either directly, 
indirectly, or through designation, any selling concession, or other 
compensation or consideration that is based upon the amount of 
Securities purchased by any single Client Plan, or that is based on the 
amount of Securities purchased by Client Plans or In-House Plans 
through Pooled Funds, pursuant to this exemption. In this regard, the 
Affiliated Broker-Dealer may not receive, either directly or 
indirectly, any compensation or consideration that is attributable to 
the fixed designations generated by purchases of the Securities by the 
asset management affiliate of CS on behalf of any single Client Plan or 
any Client Plan or In-House Plan in Pooled Funds.
    (g)(1) The amount the Affiliated Broker-Dealer receives in 
management, underwriting, or other compensation or consideration is not 
increased through an agreement, arrangement, or understanding for the 
purpose of compensating the Affiliated Broker-Dealer for foregoing any 
selling

[[Page 27567]]

concessions for those Securities sold pursuant to this exemption. 
Except as described above, nothing in this Section II(g)(1) shall be 
construed as precluding the Affiliated Broker-Dealer from receiving 
management fees for serving as manager of the underwriting or selling 
syndicate, underwriting fees for assuming the responsibilities of an 
underwriter in the underwriting or selling syndicate, or other 
compensation or consideration that is not based upon the amount of 
Securities purchased by the asset management affiliate of CS on behalf 
of any single Client Plan, or on behalf of any Client Plan or In-House 
Plan participating in Pooled Funds, pursuant to this exemption; and
    (2) The Affiliated Broker-Dealer shall provide to the asset 
management affiliate of CS a written certification, dated and signed by 
an officer of the Affiliated Broker-Dealer, stating the amount that the 
Affiliated Broker-Dealer received in compensation or consideration 
during the past quarter, in connection with any offerings covered by 
this exemption, was not adjusted in a manner inconsistent with Section 
II (e), (f), or (g) of this exemption.
    (h) The covered transactions are performed under a written 
authorization executed in advance by an independent fiduciary of each 
single Client Plan (the Independent Fiduciary), as defined, below, in 
Section III(g).
    (i) Prior to the execution by an Independent Fiduciary of a single 
Client Plan of the written authorization described, above, in Section 
II(h), the following information and materials (which may be provided 
electronically) must be provided by the asset management affiliate of 
CS to such Independent Fiduciary:
    (1) A copy of the Notice of Proposed Exemption (the Notice) and a 
copy of the final exemption (the Grant) as published in the Federal 
Register, provided that the Notice and the Grant are supplied 
simultaneously; and
    (2) Any other reasonably available information regarding the 
covered transactions that such Independent Fiduciary requests the asset 
management affiliate of CS to provide.
    (j) Subsequent to the initial authorization by an Independent 
Fiduciary of a single Client Plan permitting the asset management 
affiliate of CS to engage in the covered transactions on behalf of such 
single Client Plan, the asset management affiliate of CS will continue 
to be subject to the requirement to provide within a reasonable period 
of time any reasonably available information regarding the covered 
transactions that the Independent Fiduciary requests the asset 
management affiliate of CS to provide.
    (k)(1) In the case of an existing employee benefit plan investor 
(or existing In-House Plan investor, as the case may be) in a Pooled 
Fund, such Pooled Fund may not engage in any covered transactions 
pursuant to this exemption, unless the asset management affiliate of CS 
provides the written information, as described, below, and within the 
time period described, below, in this Section II(k)(2), to the 
Independent Fiduciary of each such plan participating in such Pooled 
Fund (and to the fiduciary of each such In-House Plan participating in 
such Pooled Fund).
    (2) The following information and materials (which may be provided 
electronically) shall be provided by the asset management affiliate of 
CS not less than 45 days prior to such asset management affiliate of CS 
engaging in the covered transactions on behalf of a Pooled Fund, 
pursuant to this exemption, and provided further that the information 
described below, in this Section II(k)(2)(i) and (iii) is supplied 
simultaneously:
    (i) A notice of the intent of such Pooled Fund to purchase 
Securities pursuant to this exemption, a copy of the Notice, and a copy 
of the Grant, as published in the Federal Register;
    (ii) Any other reasonably available information regarding the 
covered transactions that the Independent Fiduciary of a plan (or 
fiduciary of an In-House Plan) participating in a Pooled Fund requests 
the asset management affiliate of CS to provide; and
    (iii) A termination form expressly providing an election for the 
Independent Fiduciary of a plan (or fiduciary of an In-House Plan) 
participating in a Pooled Fund to terminate such plan's (or In-House 
Plan's) investment in such Pooled Fund without penalty to such plan (or 
In-House Plan). Such form shall include instructions specifying how to 
use the form. Specifically, the instructions will explain that such 
plan (or such In-House Plan) has an opportunity to withdraw its assets 
from a Pooled Fund for a period of no more than 30 days after such 
plan's (or such In-House Plan's) receipt of the initial notice of 
intent, described, above, in Section II(k)(2)(i), and that the failure 
of the Independent Fiduciary of such plan (or fiduciary of such In-
House Plan) to return the termination form to the asset management 
affiliate of CS in the case of a plan (or In-House Plan) participating 
in a Pooled Fund by the specified date shall be deemed to be an 
approval by such plan (or such In-House Plan) of its participation in 
the covered transactions as an investor in such Pooled Fund.
    Further, the instructions will identify CS, the asset management 
affiliate of CS, and the Affiliated Broker-Dealer and will provide the 
address of the asset management affiliate of CS. The instructions will 
state that this exemption may be unavailable, unless the fiduciary of 
each plan participating in the covered transactions as an investor in a 
Pooled Fund is, in fact, independent of CS, the asset management 
affiliate of CS, and the Affiliated Broker-Dealer. The instructions 
will also state that the fiduciary of each such plan must advise the 
asset management affiliate of CS, in writing, if it is not an 
``Independent Fiduciary,'' as that term is defined, below, in Section 
III(g).
    For purposes of this Section II(k), the requirement that the 
fiduciary responsible for the decision to authorize the transactions 
described, above, in Section I of this exemption for each plan be 
independent of the asset management affiliate of CS shall not apply in 
the case of an In-House Plan.
    (l)(1) In the case of each plan (and in the case of each In-House 
Plan) whose assets are proposed to be invested in a Pooled Fund after 
such Pooled Fund has satisfied the conditions set forth in this 
exemption to engage in the covered transactions, the investment by such 
plan (or by such In-House Plan) in the Pooled Fund is subject to the 
prior written authorization of an Independent Fiduciary representing 
such plan (or the prior written authorization by the fiduciary of such 
In-House Plan, as the case may be), following the receipt by such 
Independent Fiduciary of such plan (or by the fiduciary of such In-
House Plan, as the case may be) of the written information described, 
above, in Section II(k)(2)(i) and (ii); provided that the Notice and 
the Grant, described above in Section II(k)(2)(i), are provided 
simultaneously.
    (2) For purposes of this Section II(l), the requirement that the 
fiduciary responsible for the decision to authorize the transactions 
described, above, in Section I of this exemption for each plan 
proposing to invest in a Pooled Fund be independent of CS and its 
affiliates shall not apply in the case of an In-House Plan.
    (m) Subsequent to the initial authorization by an Independent 
Fiduciary of a plan (or by a fiduciary of an In-House Plan) to invest 
in a Pooled Fund that engages in the covered transactions, the asset 
management affiliate of CS will continue to be subject to the 
requirement to provide within a

[[Page 27568]]

reasonable period of time any reasonably available information 
regarding the covered transactions that the Independent Fiduciary of 
such plan (or the fiduciary of such In-House Plan, as the case may be) 
requests the asset management affiliate of CS to provide.
    (n) At least once every three months, and not later than 45 days 
following the period to which such information relates, the asset 
management affiliate of CS shall furnish:
    (1) In the case of each single Client Plan that engages in the 
covered transactions, the information described, below, in this Section 
II(n)(3)-(7), to the Independent Fiduciary of each such single Client 
Plan.
    (2) In the case of each Pooled Fund in which a Client Plan (or in 
which an In-House Plan) invests, the information described, below, in 
this Section II(n)(3)-(6) and (8), to the Independent Fiduciary of each 
such Client Plan (and to the fiduciary of each such In-House Plan) 
invested in such Pooled Fund.
    (3) A quarterly report (the Quarterly Report) (which may be 
provided electronically) which discloses all the Securities purchased 
pursuant to this exemption during the period to which such report 
relates on behalf of the Client Plan, In-House Plan, or Pooled Fund to 
which such report relates, and which discloses the terms of each of the 
transactions described in such report, including:
    (i) The type of Securities (including the rating of any Securities 
which are debt securities) involved in each transaction;
    (ii) The price at which the Securities were purchased in each 
transaction;
    (iii) The first day on which any sale was made during the offering 
of the Securities;
    (iv) The size of the issue of the Securities involved in each 
transaction;
    (v) The number of Securities purchased by the asset management 
affiliate of CS for the Client Plan, In-House Plan, or Pooled Fund to 
which the transaction relates;
    (vi) The identity of the underwriter from whom the Securities were 
purchased for each transaction;
    (vii) The underwriting spread in each transaction (i.e., the 
difference, between the price at which the underwriter purchases the 
Securities from the issuer and the price at which the Securities are 
sold to the public);
    (viii) The price at which any of the Securities purchased during 
the period to which such report relates were sold; and
    (ix) The market value at the end of the period to which such report 
relates of the Securities purchased during such period and not sold;
    (4) The Quarterly Report contains:
    (i) A representation that the asset management affiliate of CS has 
received a written certification signed by an officer of the Affiliated 
Broker-Dealer, as described, above, in Section II(g)(2), affirming 
that, as to each AUT covered by this exemption during the past quarter, 
the Affiliated Broker-Dealer acted in compliance with Section II(e), 
(f), and (g) of this exemption, and
    (ii) A representation that copies of such certifications will be 
provided upon request;
    (5) A disclosure in the Quarterly Report that states that any other 
reasonably available information regarding a covered transaction that 
an Independent Fiduciary (or fiduciary of an In-House Plan) requests 
will be provided, including, but not limited to:
    (i) The date on which the Securities were purchased on behalf of 
the Client Plan (or the In-House Plan) to which the disclosure relates 
(including Securities purchased by Pooled Funds in which such Client 
Plan (or such In-House Plan) invests);
    (ii) The percentage of the offering purchased on behalf of all 
Client Plans (and the pro-rata percentage purchased on behalf of Client 
Plans and In-House Plans investing in Pooled Funds); and
    (iii) The identity of all members of the underwriting syndicate;
    (6) The Quarterly Report discloses any instance during the past 
quarter where the asset management affiliate of CS was precluded for 
any period of time from selling Securities purchased under this 
exemption in that quarter because of its status as an affiliate of an 
Affiliated Broker-Dealer and the reason for this restriction;
    (7) Explicit notification, prominently displayed in each Quarterly 
Report sent to the Independent Fiduciary of each single Client Plan 
that engages in the covered transactions that the authorization to 
engage in such covered transactions may be terminated, without penalty 
to such single Client Plan, within five (5) days after the date that 
the Independent Fiduciary of such single Client Plan informs the person 
identified in such notification that the authorization to engage in the 
covered transactions is terminated; and
    (8) Explicit notification, prominently displayed in each Quarterly 
Report sent to the Independent Fiduciary of each Client Plan (and to 
the fiduciary of each In-House Plan) that engages in the covered 
transactions through a Pooled Fund that the investment in such Pooled 
Fund may be terminated, without penalty to such Client Plan (or such 
In-House Plan), within such time as may be necessary to effect the 
withdrawal in an orderly manner that is equitable to all withdrawing 
plans and to the non-withdrawing plans, after the date that the 
Independent Fiduciary of such Client Plan (or the fiduciary of such In-
House Plan, as the case may be) informs the person identified in such 
notification that the investment in such Pooled Fund is terminated.
    (o) For purposes of engaging in covered transactions, each Client 
Plan (and each In-House Plan) shall have total net assets with a value 
of at least $50 million (the $50 Million Net Asset Requirement). For 
purposes of engaging in covered transactions involving an Eligible Rule 
144A Offering,\2\ each Client Plan (and each In-House Plan) shall have 
total net assets of at least $100 million in securities of issuers that 
are not affiliated with such Client Plan (or such In-House Plan, as the 
case may be) (the $100 Million Net Asset Requirement).
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    \2\ SEC Rule 10f-3(a)(4), 17 FR 270.10f-3(a)(4), states that the 
term ``Eligible Rule 144A Offering'' means an offering of securities 
that meets the following conditions:
    (i) The securities are offered or sold in transactions exempt 
from registration under section 4(2) of the Securities Act of 1933 
[15 U.S.C. 77d(d)], rule 144A thereunder [Sec.  230.144A of this 
chapter], or rules 501-508 thereunder [Sec. Sec.  230.501-230.508 if 
this chapter];
    (ii) The securities are sold to persons that the seller and any 
person acting on behalf of the seller reasonably believe to include 
qualified institutional buyers, as defined in Sec.  230.144A(a)(1) 
of this chapter; and
    (iii) The seller and any person acting on behalf of the seller 
reasonably believe that the securities are eligible for resale to 
other qualified institutional buyers pursuant to Sec.  230.144A of 
this chapter.
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    For purposes of a Pooled Fund engaging in covered transactions, 
each Client Plan (and each In-House Plan) in such Pooled Fund shall 
have total net assets with a value of at least $50 million. 
Notwithstanding the foregoing, if each such Client Plan (and each such 
In-House Plan) in such Pooled Fund does not have total net assets with 
a value of at least $50 million, the $50 Million Net Asset Requirement 
will be met if 50 percent (50%) or more of the units of beneficial 
interest in such Pooled Fund are held by Client Plans (or by In-House 
Plans) each of which has total net assets with a value of at least $50 
million. For purposes of a Pooled Fund engaging in covered transactions 
involving an Eligible Rule 144A Offering, each Client Plan (and each 
In-House Plan) in such Pooled Fund shall have total net assets of at 
least $100 million in securities of issuers that are not affiliated 
with such Client Plan (or such In-House Plan, as the case may be). 
Notwithstanding the foregoing, if each

[[Page 27569]]

such Client Plan (and each such In-House Plan) in such Pooled Fund does 
not have total net assets of at least $100 million in securities of 
issuers that are not affiliated with such Client Plan (or In-House 
Plan, as the case may be), the $100 Million Net Asset Requirement will 
be met if 50 percent (50%) or more of the units of beneficial interest 
in such Pooled Fund are held by Client Plans (or by In-House Plans) 
each of which have total net assets of at least $100 million in 
securities of issuers that are not affiliated with such Client Plan (or 
such In-House Plan, as the case may be), and the Pooled Fund itself 
qualifies as a QIB, as determined pursuant to SEC Rule 144A (17 CFR 
230.144A(a)(F)).
    For purposes of the net asset requirements described above, in this 
Section II(o), where a group of Client Plans is maintained by a single 
employer or controlled group of employers, as defined in section 
407(d)(7) of the Act, the $50 Million Net Asset Requirement (or in the 
case of an Eligible Rule 144A Offering, the $100 Million Net Asset 
Requirement) may be met by aggregating the assets of such Client Plans, 
if the assets of such Client Plans are pooled for investment purposes 
in a single master trust.
    (p) The asset management affiliate of CS qualifies as a ``qualified 
professional asset manager'' (QPAM), as that term is defined under 
Section V(a) of PTE 84-14. In addition to satisfying the requirements 
for a QPAM under Section V(a) of PTE 84-14, the asset management 
affiliate of CS must also have total client assets under its management 
and control in excess of $5 billion, as of the last day of its most 
recent fiscal year and shareholders' or partners' equity in excess of 
$1 million.
    (q) No more than 20 percent of the assets of a Pooled Fund at the 
time of a covered transaction, are comprised of assets of In-House 
Plans for which CS, the asset management affiliate of CS, the 
Affiliated Broker-Dealer, or an affiliate exercises investment 
discretion.
    (r) The asset management affiliate of CS, and the Affiliated 
Broker-Dealer, as applicable, maintain, or cause to be maintained, for 
a period of six (6) years from the date of any covered transaction such 
records as are necessary to enable the persons, described, below, in 
Section II(s), to determine whether the conditions of this exemption 
have been met, except that--
    (1) No party in interest with respect to a plan which engages in 
the covered transactions, other than CS, the asset management affiliate 
of CS, and the Affiliated Broker-Dealer, as applicable, shall be 
subject to a civil penalty under section 502(i) of the Act or the taxes 
imposed by section 4975(a) and (b) of the Code, if such records are not 
maintained, or not available for examination, as required, below, by 
Section II(s); and
    (2) A separate prohibited transaction shall not be considered to 
have occurred solely because, due to circumstances beyond the control 
of the asset management affiliate of CS, or the Affiliated Broker-
Dealer, as applicable, such records are lost or destroyed prior to the 
end of the six-year period.
    (s)(1) Except as provided, below, in Section II(s)(2), and 
notwithstanding any provisions of subsections (a)(2) and (b) of section 
504 of the Act, the records referred to above, in Section II(r), are 
unconditionally available at their customary location for examination 
during normal business hours by--
    (i) Any duly authorized employee or representative of the 
Department, the Internal Revenue Service, or the SEC; or
    (ii) Any fiduciary of any plan that engages in the covered 
transactions, or any duly authorized employee or representative of such 
fiduciary; or
    (iii) Any employer of participants and beneficiaries and any 
employee organization whose members are covered by a plan that engages 
in the covered transactions, or any authorized employee or 
representative of these entities; or
    (iv) Any participant or beneficiary of a plan that engages in the 
covered transactions, or duly authorized employee or representative of 
such participant or beneficiary;
    (2) None of the persons described above, in Section II(s)(1)(ii)--
(iv), shall be authorized to examine trade secrets of the asset 
management affiliate of CS, or the Affiliated Broker-Dealer, or 
commercial or financial information which is privileged or 
confidential; and
    (3) Should the asset management affiliate of CS, or the Affiliated 
Broker-Dealer refuse to disclose information on the basis that such 
information is exempt from disclosure, pursuant to Section II(s)(2) 
above, the asset management affiliate of CS shall, by the close of the 
thirtieth (30th) day following the request, provide a written notice 
advising that person of the reasons for the refusal and that the 
Department may request such information.

Section III--Definitions

    (a) The term, ``the Applicant,'' means CS and its current and 
future affiliates.
    (b) The term, ``Affiliated Broker-Dealer,'' means any broker-dealer 
affiliate, as ``affiliate'' is defined, below, in Section III(c), of 
the Applicant, as ``Applicant'' is defined, above, in Section III(a), 
that meets the requirements of this exemption. Such Affiliated Broker-
Dealer may participate in an underwriting or selling syndicate as a 
manager or member. The term, ``manager,'' means any member of an 
underwriting or selling syndicate who, either alone or together with 
other members of the syndicate, is authorized to act on behalf of the 
members of the syndicate in connection with the sale and distribution 
of the Securities, as defined below, in Section III(h), being offered 
or who receives compensation from the members of the syndicate for its 
services as a manager of the syndicate.
    (c) The term ``affiliate'' of a person includes:
    (1) Any person directly or indirectly through one or more 
intermediaries, controlling, controlled by, or under common control 
with such person;
    (2) Any officer, director, partner, employee, or relative, as 
defined in section 3(15) of the Act, of such person; and
    (3) Any corporation or partnership of which such person is an 
officer, director, partner, or employee.
    (d) The term, ``control,'' means the power to exercise a 
controlling influence over the management or policies of a person other 
than an individual.
    (e) The term, ``Client Plan(s),'' means an employee benefit plan(s) 
that is subject to the Act and/or the Code, and for which plan(s) an 
asset management affiliate of CS exercises discretionary authority or 
discretionary control respecting management or disposition of some or 
all of the assets of such plan(s), but excludes In-House Plans, as 
defined, below, in Section III(l).
    (f) The term, ``Pooled Fund(s),'' means a common or collective 
trust fund(s) or a pooled investment fund(s):
    (1) In which employee benefit plan(s) subject to the Act and/or 
Code invest,
    (2) Which is maintained by an asset management affiliate of CS, (as 
the term, ``affiliate'' is defined, above, in Section III(c)), and
    (3) For which such asset management affiliate of CS exercises 
discretionary authority or discretionary control respecting the 
management or disposition of the assets of such fund(s).
    (g)(1) The term, ``Independent Fiduciary,'' means a fiduciary of a 
plan who is unrelated to, and independent of CS, the asset management 
affiliate of CS, and the Affiliated Broker-Dealer. For purposes of this 
exemption, a fiduciary of a plan will be deemed to be unrelated to, and 
independent of CS, the asset management affiliate of CS, and the 
Affiliated Broker-Dealer, if such

[[Page 27570]]

fiduciary represents in writing that neither such fiduciary, nor any 
individual responsible for the decision to authorize or terminate 
authorization for the transactions described above, in Section I of 
this exemption, is an officer, director, or highly compensated employee 
(within the meaning of section 4975(e)(2)(H) of the Code) of CS, the 
asset management affiliate of CS, or the Affiliated Broker-Dealer, and 
represents that such fiduciary shall advise the asset management 
affiliate of CS within a reasonable period of time after any change in 
such facts occur.
    (2) Notwithstanding anything to the contrary in this Section 
III(g), a fiduciary of a plan is not independent:
    (i) If such fiduciary directly or indirectly controls, is 
controlled by, or is under common control with CS, the asset management 
affiliate of CS, or the Affiliated Broker-Dealer;
    (ii) If such fiduciary directly or indirectly receives any 
compensation or other consideration from CS, the asset management 
affiliate of CS, or the Affiliated Broker-Dealer for his or her own 
personal account in connection with any transaction described in this 
exemption;
    (iii) If any officer, director, or highly compensated employee 
(within the meaning of section 4975(e)(2)(H) of the Code) of the asset 
management affiliate of CS responsible for the transactions described 
above, in Section I of this exemption, is an officer, director, or 
highly compensated employee (within the meaning of section 
4975(e)(2)(H) of the Code) of the sponsor of the plan or of the 
fiduciary responsible for the decision to authorize or terminate 
authorization for the transactions described above, in Section I. 
However, if such individual is a director of the sponsor of the plan or 
of the responsible fiduciary, and if he or she abstains from 
participation in: (A) The choice of the plan's investment manager/
adviser; and (B) the decision to authorize or terminate authorization 
for transactions described above, in Section I, then this Section 
III(g)(2)(iii) shall not apply.
    (3) The term, ``officer,'' means a president, any vice president in 
charge of a principal business unit, division, or function (such as 
sales, administration, or finance), or any other officer who performs a 
policy-making function for CS or any affiliate thereof.
    (h) The term, ``Securities,'' shall have the same meaning as 
defined in section 2(36) of the Investment Company Act of 1940 (the 
1940 Act), as amended (15 U.S.C. 80a-2(36)(2000)). For purposes of this 
exemption, mortgage-backed or other asset-backed securities rated by 
one of the Rating Organizations, as defined, below, in Section III(k), 
will be treated as debt securities.
    (i) The term, ``Eligible Rule 144A Offering,'' shall have the same 
meaning as defined in SEC Rule 10f-3(a)(4) (17 CFR 270.10f-3(a)(4)) 
under the 1940 Act).
    (j) The term, ``qualified institutional buyer,'' or the term, 
``QIB,'' shall have the same meaning as defined in SEC Rule 144A (17 
CFR 230.144A(a)(1)) under the 1933 Act.
    (k) The term, ``Rating Organizations,'' means Standard & Poor's 
Rating Services, Moody's Investors Service, Inc., FitchRatings, Inc., 
Dominion Bond Rating Service Limited, and Dominion Bond Rating Service, 
Inc., or any successors thereto.
    (l) The term, ``In-House Plan(s),'' means an employee benefit 
plan(s) that is subject to the Act and/or the Code, and that is 
sponsored by the Applicant, as defined, above, in Section III(a) for 
its own employees.
    For a more complete statement of the facts and representations 
supporting the Department's decision to grant this exemption, refer to 
the Notice published on January 17, 2008 at 73 FR 3282.

FOR FURTHER INFORMATION CONTACT: Mr. Gary H. Lefkowitz of the 
Department, telephone (202) 693-8546. (This is not a toll-free number.)

Amendment to Prohibited Transaction Exemption (PTE) 93-31, 58 FR 28620 
(May 14, 1993), as amended by PTE 97-34, 62 FR 39021 (July 21, 1997), 
PTE 2000-58, 65 FR 67765 (November 13, 2000), PTE 2002-41, 67 FR 54487 
(August 22, 2002) and PTE 2007-05, 72 FR 13130 (March 20, 2007), 
Technical Correction at 72 FR 16385 (April 4, 2007)(PTE 93-31), 
Involving Bank of America, N.A., the Successor of NationsBank 
Corporation

[Prohibited Transaction Exemption 2008-08; Exemption Application No. D-
11446]

Exemption

    In accordance with section 408(a) of the Act and section 4975(c)(2) 
of the Code and the procedures set forth in 29 CFR Part 2570, Subpart B 
(55 FR 32836, August 10, 1990) and based upon the entire record, the 
Department amends Prohibited Transaction Exemption (PTE) 93-31, 58 FR 
28620 (May 5, 1993); as subsequently amended by PTE 97-34, 62 FR 39021 
(July 21, 1997), PTE 2000-58, 65 FR 67765 (November 13, 2000), PTE 
2002-41, 67 FR 54487 (August 22, 2002) and PTE 2007-05, 72 FR 13130 
(March 20, 2007), Technical Correction at 72 FR 16385 (April 4, 2007) 
(PTE 93-31).

I. Transactions

    A. Effective October 1, 2007, the restrictions of sections 406(a) 
and 407(a) of the Act, and the taxes imposed by sections 4975(a) and 
(b) of the Code, by reason of section 4975(c)(1)(A) through (D) of the 
Code shall not apply to the following transactions involving Issuers 
and Securities evidencing interests therein:
    (1) The direct or indirect sale, exchange or transfer of Securities 
in the initial issuance of Securities between the Sponsor or 
Underwriter and an employee benefit plan when the Sponsor, Servicer, 
Trustee or Insurer of an Issuer, the Underwriter of the Securities 
representing an interest in the Issuer, or an Obligor is a party in 
interest with respect to such plan;
    (2) The direct or indirect acquisition or disposition of Securities 
by a plan in the secondary market for such Securities; and
    (3) The continued holding of Securities acquired by a plan pursuant 
to subsection I.A.(1) or (2).
    Notwithstanding the foregoing, section I.A. does not provide an 
exemption from the restrictions of sections 406(a)(1)(E), 406(a)(2) and 
407 of the Act for the acquisition or holding of a Security on behalf 
of an Excluded Plan by any person who has discretionary authority or 
renders investment advice with respect to the assets of that Excluded 
Plan.\3\
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    \3\ Section I.A. provides no relief from sections 406(a)(1)(E), 
406(a)(2) and 407 of the Act for any person rendering investment 
advice to an Excluded Plan within the meaning of section 
3(21)(A)(ii) of the Act, and regulation 29 CFR 2510.3-21(c).
---------------------------------------------------------------------------

    B. Effective October 1, 2007, the restrictions of sections 
406(b)(1) and 406(b)(2) of the Act and the taxes imposed by sections 
4975(a) and (b) of the Code, by reason of section 4975(c)(1)(E) of the 
Code, shall not apply to:
    (1) The direct or indirect sale, exchange or transfer of Securities 
in the initial issuance of Securities between the Sponsor or 
Underwriter and a plan when the person who has discretionary authority 
or renders investment advice with respect to the investment of plan 
assets in the Securities is (a) an Obligor with respect to 5 percent or 
less of the fair market value of obligations or receivables contained 
in the Issuer, or (b) an Affiliate of a person described in (a); if:
    (i) The plan is not an Excluded Plan;
    (ii) Solely in the case of an acquisition of Securities in 
connection with the initial issuance of the Securities, at least 50 
percent of each class of Securities in which plans have invested is 
acquired

[[Page 27571]]

by persons independent of the members of the Restricted Group and at 
least 50 percent of the aggregate interest in the Issuer is acquired by 
persons independent of the Restricted Group;
    (iii) A plan's investment in each class of Securities does not 
exceed 25 percent of all of the Securities of that class outstanding at 
the time of the acquisition; and
    (iv) Immediately after the acquisition of the Securities, no more 
than 25 percent of the assets of a plan with respect to which the 
person has discretionary authority or renders investment advice are 
invested in Securities representing an interest in an Issuer containing 
assets sold or serviced by the same entity.\4\ For purposes of this 
paragraph (iv) only, an entity will not be considered to service assets 
contained in an Issuer if it is merely a Subservicer of that Issuer;
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    \4\ For purposes of this Underwriter Exemption, each plan 
participating in a commingled fund (such as a bank collective trust 
fund or insurance company pooled separate account) shall be 
considered to own the same proportionate undivided interest in each 
asset of the commingled fund as its proportionate interest in the 
total assets of the commingled fund as calculated on the most recent 
preceding valuation date of the fund.
---------------------------------------------------------------------------

    (2) The direct or indirect acquisition or disposition of Securities 
by a plan in the secondary market for such Securities, provided that 
the conditions set forth in paragraphs (i), (iii) and (iv) of 
subsection I.B.(1) are met; and
    (3) The continued holding of Securities acquired by a plan pursuant 
to subsection I.B.(1) or (2).
    C. Effective October 1, 2007, the restrictions of sections 406(a), 
406(b) and 407(a) of the Act, and the taxes imposed by section 4975(a) 
and (b) of the Code by reason of section 4975(c) of the Code, shall not 
apply to transactions in connection with the servicing, management and 
operation of an Issuer, including the use of any Eligible Swap 
transaction; or the defeasance of a mortgage obligation held as an 
asset of the Issuer through the substitution of a new mortgage 
obligation in a commercial mortgage-backed Designated Transaction, 
provided:
    (1) Such transactions are carried out in accordance with the terms 
of a binding Pooling and Servicing Agreement;
    (2) The Pooling and Servicing Agreement is provided to, or 
described in all material respects in the prospectus or private 
placement memorandum provided to, investing plans before they purchase 
Securities issued by the Issuer; \5\ and
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    \5\ In the case of a private placement memorandum, such 
memorandum must contain substantially the same information that 
would be disclosed in a prospectus if the offering of the securities 
were made in a registered public offering under the Securities Act 
of 1933. In the Department's view, the private placement memorandum 
must contain sufficient information to permit plan fiduciaries to 
make informed investment decisions. For purposes of this exemption, 
references to ``prospectus'' include any related prospectus 
supplement thereto, pursuant to which Securities are offered to 
investors.
---------------------------------------------------------------------------

    (3) The defeasance of a mortgage obligation and the substitution of 
a new mortgage obligation in a commercial mortgage-backed Designated 
Transaction meet the terms and conditions for such defeasance and 
substitution as are described in the prospectus or private placement 
memorandum for such Securities, which terms and conditions have been 
approved by a Rating Agency and does not result in the Securities 
receiving a lower credit rating from the Rating Agency than the current 
rating of the Securities.
    Notwithstanding the foregoing, section I.C. does not provide an 
exemption from the restrictions of section 406(b) of the Act or from 
the taxes imposed by reason of section 4975(c) of the Code for the 
receipt of a fee by a Servicer of the Issuer from a person other than 
the Trustee or Sponsor, unless such fee constitutes a Qualified 
Administrative Fee.
    D. Effective October 1, 2007, the restrictions of sections 406(a) 
and 407(a) of the Act, and the taxes imposed by section 4975(a) and (b) 
of the Code by reason of section 4975(c)(1)(A) through (D) of the Code, 
shall not apply to any transactions to which those restrictions or 
taxes would otherwise apply merely because a person is deemed to be a 
party in interest or disqualified person (including a fiduciary) with 
respect to a plan by virtue of providing services to the plan (or by 
virtue of having a relationship to such service provider described in 
section 3(14)(F), (G), (H) or (I) of the Act or section 4975(e)(2)(F), 
(G), (H) or (I) of the Code), solely because of the plan's ownership of 
Securities.

II. General Conditions

    A. The relief provided under section I. is available only if the 
following conditions are met:
    (1) The acquisition of Securities by a plan is on terms (including 
the Security price) that are at least as favorable to the plan as they 
would be in an arm's-length transaction with an unrelated party;
    (2) The rights and interests evidenced by the Securities are not 
subordinated to the rights and interests evidenced by other Securities 
of the same Issuer, unless the Securities are issued in a Designated 
Transaction;
    (3) The Securities acquired by the plan have received a rating from 
a Rating Agency at the time of such acquisition that is in one of the 
three (or in the case of Designated Transactions, four) highest generic 
rating categories;
    (4) The Trustee is not an Affiliate of any member of the Restricted 
Group, other than an Underwriter. For purposes of this requirement:
    (a) The Trustee shall not be considered to be an Affiliate of a 
Servicer solely because the Trustee has succeeded to the rights and 
responsibilities of the Servicer pursuant to the terms of a Pooling and 
Servicing Agreement providing for such succession upon the occurrence 
of one or more events of default by the Servicer; and
    (b) Subsection II.A.(4) will be deemed satisfied notwithstanding a 
Servicer becoming an Affiliate of the Trustee as the result of a merger 
or acquisition involving the Trustee, such Servicer and/or their 
Affiliates which occurs after the initial issuance of the Securities, 
provided that:
    (i) Such Servicer ceases to be an Affiliate of the Trustee no later 
than six months after the date such Servicer became an Affiliate of the 
Trustee; and
    (ii) Such Servicer did not breach any of its obligations under the 
Pooling and Servicing Agreement, unless such breach was immaterial and 
timely cured in accordance with the terms of such agreement, during the 
period from the closing date of such merger or acquisition transaction 
through the date the Servicer ceased to be an Affiliate of the Trustee;
    (c) Effective October 1, 2007 through April 1, 2008, LaSalle Bank, 
N.A., the Trustee, shall not be considered to be an Affiliate of any 
member of the Restricted Group solely as the result of the acquisition 
of ABN Amro North America Holding Company, the holding company of 
LaSalle Bank Corporation and its subsidiary, LaSalle Bank, N.A. 
(LaSalle) by Bank of America Corporation and its subsidiaries (Bank of 
America) (the Acquisition), which occurred after the initial issuance 
of the Securities, provided that:
    (i) The Trustee, LaSalle, ceases to be an Affiliate of any member 
of the Restricted Group no later than April 1, 2008;
    (ii) Any member of the Restricted Group that is an Affiliate of the 
Trustee, LaSalle, did not breach any of its obligations under the 
Pooling and Servicing Agreement, unless such breach was immaterial and 
timely cured in accordance with the terms of such

[[Page 27572]]

agreement, during the period from October 1, 2007 through the date the 
member of the Restricted Group ceased to be an Affiliate of the 
Trustee, LaSalle; and
    (iii) In accordance with each Pooling and Servicing Agreement, the 
Trustee, LaSalle, appoints a co-trustee, which is not an Affiliate of 
Bank of America, no later than the earlier of (A) January 2, 2008 or 
(B) five business days after LaSalle becomes aware of a conflict 
between the Trustee and any member of the Restricted Group that is an 
Affiliate of the Trustee. The co-trustee will be responsible for 
resolving any conflict between the Trustee and any member of the 
Restricted Group that has become an Affiliate of the Trustee as a 
result of the Acquisition; provided that if the Trustee has resigned on 
or prior to January 2, 2008 and no event described in clause (B) has 
occurred, no co-trustee shall be required.
    (iv) For purposes of this subsection II.A.(4)(c), a conflict arises 
whenever (A) Bank of America, as a member of the Restricted Group, 
fails to perform in accordance with the timeframes contained in the 
relevant Pooling and Servicing Agreement following a request for 
performance from LaSalle, as Trustee, or (B) LaSalle, as Trustee, fails 
to perform in accordance with the timeframes contained in the relevant 
Pooling and Servicing Agreement following a request for performance 
from Bank of America, a member of the Restricted Group.
    The time as of which a conflict occurs is the earlier of: The day 
immediately following the last day on which compliance is required 
under the relevant Pooling and Servicing Agreement; or the day on which 
a party affirmatively responds that it will not comply with a request 
for performance.
    For purposes of this subsection II.A.(4)(c), the term ``conflict'' 
includes but is not limited to, the following: (1) Bank of America's 
failure, as Sponsor, to repurchase a loan for breach of representation 
within the time period prescribed in the relevant Pooling and Servicing 
Agreement, following LaSalle's request, as Trustee, for performance; 
(2) Bank of America, as Sponsor, notifies LaSalle, as Trustee, that it 
will not repurchase a loan for breach of representation, following 
LaSalle's request that Bank of America repurchase such loan within the 
time period prescribed in the relevant Pooling and Servicing Agreement 
(the notification occurs prior to the expiration of the prescribed time 
period for the repurchase); and (3) Bank of America, as Swap 
Counterparty, makes or requests a payment based on a value of the 
London Interbank Offered Rate (LIBOR) that LaSalle, as Trustee, 
considers erroneous.
    (5) The sum of all payments made to and retained by the 
Underwriters in connection with the distribution or placement of 
Securities represents not more than Reasonable Compensation for 
underwriting or placing the Securities; the sum of all payments made to 
and retained by the Sponsor pursuant to the assignment of obligations 
(or interests therein) to the Issuer represents not more than the fair 
market value of such obligations (or interests); and the sum of all 
payments made to and retained by the Servicer represents not more than 
Reasonable Compensation for the Servicer's services under the Pooling 
and Servicing Agreement and reimbursement of the Servicer's reasonable 
expenses in connection therewith;
    (6) The plan investing in such Securities is an ``accredited 
investor'' as defined in Rule 501(a)(1) of Regulation D of the 
Securities and Exchange Commission under the Securities Act of 1933; 
and
    (7) In the event that the obligations used to fund a Issuer have 
not all been transferred to the Issuer on the Closing Date, additional 
obligations of the types specified in subsection III.B.(1) may be 
transferred to the Issuer during the Pre-Funding Period in exchange for 
amounts credited to the Pre-Funding Account, provided that:
    (a) The Pre-Funding Limit is not exceeded;
    (b) All such additional obligations meet the same terms and 
conditions for determining the eligibility of the original obligations 
used to create the Issuer (as described in the prospectus or private 
placement memorandum and/or Pooling and Servicing Agreement for such 
Securities), which terms and conditions have been approved by a Rating 
Agency.
    Notwithstanding the foregoing, the terms and conditions for 
determining the eligibility of an obligation may be changed if such 
changes receive prior approval either by a majority vote of the 
outstanding securityholders or by a Rating Agency;
    (c) The transfer of such additional obligations to the Issuer 
during the Pre-Funding Period does not result in the Securities 
receiving a lower credit rating from a Rating Agency upon termination 
of the Pre-Funding Period than the rating that was obtained at the time 
of the initial issuance of the Securities by the Issuer;
    (d) The weighted average annual percentage interest rate (the 
average interest rate) for all of the obligations held by the Issuer at 
the end of the Pre-Funding Period will not be more than 100 basis 
points lower than the average interest rate for the obligations which 
were transferred to the Issuer on the Closing Date;
    (e) In order to ensure that the characteristics of the receivables 
actually acquired during the Pre-Funding Period are substantially 
similar to those which were acquired as of the Closing Date, the 
characteristics of the additional obligations will either be monitored 
by a credit support provider or other insurance provider which is 
independent of the Sponsor or an independent accountant retained by the 
Sponsor will provide the Sponsor with a letter (with copies provided to 
the Rating Agency, the Underwriter and the Trustee) stating whether or 
not the characteristics of the additional obligations conform to the 
characteristics of such obligations described in the prospectus, 
private placement memorandum and/or Pooling and Servicing Agreement. In 
preparing such letter, the independent accountant will use the same 
type of procedures as were applicable to the obligations which were 
transferred as of the Closing Date;
    (f) The Pre-Funding Period shall be described in the prospectus or 
private placement me