Pennsylvania Higher Education Assistance Agency Alternative Loan Servicing Agreement for The First Marblehead Corporation
Pennsylvania
Higher Education Assistance Agency
Alternative
Loan Servicing Agreement for The First Marblehead
Corporation
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CONFIDENTIAL
MATERIALS OMITTED AND FILED
SEPARATELY WITH THE
SECURITIES
AND EXCHANGE COMMISSION.
ASTERISKS DENOTE
OMISSIONS.
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Exhibit
99.8
ALTERNATIVE
SERVICING AGREEMENT
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
THIS
AGREEMENT is made this day of October, 2001, by and between the Pennsylvania
Higher Education Assistance Agency, a public corpora-tion and governmental
instrumentality organized under the laws of the Commonwealth of Pennsylvania,
having an address at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(herein called the "Servicer"), and The First Marblehead Corporation, having
an
address at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
RECITALS
WHEREAS,
the Servicer is in the business of servicing privately insured alternative
student loans and other education loans for lenders; and
WHEREAS,
Program Lender (defined below), The Education Resource Institute (“▇▇▇▇”) and
The First Marblehead Corporation (herein called "FMC"), have created a group
of
education loan programs, all of which are described in the Program Guidelines
and guaranteed by ▇▇▇▇ (“▇▇▇▇ Loans); and
WHEREAS,
FMC desires to utilize the expertise of the Servicer to service the ▇▇▇▇ Loans
as and when they are purchased by FMC or its designee.
NOW,
THEREFORE, in consideration of the mutual promises contained in this Agreement
and the fees to be paid by FMC to the Servicer, and intending to be legally
bound, the parties to this Agreement do hereby agree to the
following:
SECTION
1. DEFINITIONS
1.1. "Account"
means the Student Loans collectively of an individual Borrower of a
loan.
1.2. "Agreement"
means this Alternative Servicing Agreement, including each schedule provided
for
herein and each amendment hereafter adopted.
1.3. "Borrower"
means an individual who is the maker of a promissory note and who obtains a
Student Loan in accordance with the “Regulations” as set forth in Section
1.11.
1.4. "Business
Days" means a day of the year other than a Saturday or Sunday, or a day on
which
the Servicer or FMC is required or authorized by law to remain closed, and
on
which either does remain closed.
1.5. “FMC”
means The First Marblehead Corporation in its capacity as Program Manager and
Securitization Sponsor, as defined in the Program Guidelines, and as a party
entitled to Servicing of ▇▇▇▇ Loans under this Agreement, which rights the
parties contemplate will be, with respect to pools of Student Loans, assigned
to
Permitted Assignees pursuant to Section 11.4 hereof. FMC shall not actually
receive Services nor have liability under this Agreement unless and until FMC
becomes an Owner of Student Loans.
1.6. "Insurer"
means The Education Resources Institute, Inc. (“▇▇▇▇”) or such other private
insurance agencies as the parties may mutually agree upon from time to time.
1.7. “Owner”
means a Permitted Assignee that purchases Student Loans.
1.8. “Permitted
Assignee” means an SPE, as defined below, and any financial institution, bond
insurer, guaranty agency, indenture trustee, lender’s collateral agent or other
substantially similar party to whom rights under this agreement are assigned
as
security in a financing transaction to which the SPE is a party.
1.9. “Program
Guidelines” means the Underwriting, Origination and Loan Term Guidelines for
EDUCATION ONE K-12 Loan Program, EDUCATION ONE Undergraduate Loan Program,
EDUCATION ONE Graduate Loan Program, and EDUCATION ONE Continuing Education
Loan
Program, all as approved and adopted by ▇▇▇▇. The term also refers to any other
loan program guidelines governing loans guaranteed by ▇▇▇▇ that the parties
hereto may designate as covered by this Agreement in a written supplement to
this Agreement.
1.10. “Program
Lender” means Bank One, National Association, and such other lenders making
loans guaranteed by ▇▇▇▇ and serviced by Servicer as the parties may designate
as covered by this Agreement in a written supplement to this Agreement
___________________.
1.11. "Regulations"
means any rule, regulations, instruction, procedure or servicing guidelines
issued by the Insurer and approved by FMC and Servicer, including without
limitation the Servicing Guidelines for ▇▇▇▇ Loan Programs serviced at SLSC/GLC,
revised 9/27/00.
1.12. “Securitization
Transaction” means the purchase of a pool of Student Loans by an SPE, in
connection with which Servicer agrees to execute a Servicer Consent Letter
in
substantially the form of Schedule A.
1.13. “Servicer
Consent Letter” means a letter substantially in the form of Schedule A, to be
executed by Servicer, FMC, and an SPE in connection with each Securitization
Transaction.
1.14. "Service",
"Services", "Serviced", "Servicing" used in connection with a Student Loan
or
Student Loans means to perform the procedures of a continuing nature required
of
the Servicer pursuant to this Agreement in accordance with the
Regulations.
1.15. “Special
Purpose Entity” or “SPE” means a trust, corporation or limited liability company
organized by FMC and engaged solely in the business of purchasing Student Loans
and engaging in financing and/or securities transactions to obtain funds to
purchase such Student Loans.
1.16. "Student
Loan" means any of, and "Student Loans" means all, the ▇▇▇▇ Loans executed
by a
Borrower, insured by the Insurer, funded by Program Lender and purchased by
FMC
or an SPE, and serviced by the Servicer pursuant to this Agreement.
1.17. “Trustee”
means the Permitted Assignee having a lien or security interest in a pool of
Student Loans, which lien or security interest is held for the benefit of
investors or lenders providing funds in such Securitization
Transactions.
SECTION
2. SCOPE OF AGREEMENT
The
Servicer agrees, in consideration of certain fees, to perform certain Services
as set forth in the Agreement, Schedules and Exhibits and any additional
services which FMC requests and the Servicer agrees to provide relative to
the
Servicing of Student Loans, for which account infor-mation and/or documentation
shall be delivered to the Servicer. Specifically and without limitation,
Servicer agrees to Service the Student Loans in accordance with the
Regulations.
SECTION
3.
TERM OF AGREEMENT
This
Agreement shall commence on the date above written and shall continue until
such
time as the principal of and interest on the Student Loans which are subject
to
this Agreement are paid in full unless terminated by either party pursuant
to
Section 12.
SECTION
4. DUTIES OF FMC AND THE SERVICER
4.1. Lost
or Damaged Records.
In the
event that records or other data submitted to the Servicer for processing should
be lost or damaged while in the possession, control or custody of the Servicer
or its agents, such lost or damaged records or data shall be reproduced by
the
Servicer at the Servicer's own cost and expense from microfilm duplicates in
the
Servicer's possession or under the Servicer's control.
4.2. System
Changes.
The
Servicer has the right to change any part or all of its equipment, its servicing
system, computer programs, and its procedures relating to the manner of or
the
methodology used in servicing the Student Loans, provided however, that in
no
event shall such change abrogate or in any way modify the obligations of the
Servicer with respect to the substantive provisions of this Agreement,
specifically all requirements of the Regulations, the quality of the Service
or
the compliance requirements set forth herein. It is specifically understood
that
the intent of this paragraph is to allow the Servicer flexibility over the
methods and techniques of Servicing subject to full compliance with the
substantive terms of this Agreement. The Servicer agrees to give FMC ninety
(90)
days advance written notice and description of any material discretionary change
in its computer system or procedures which will significantly affect FMC's
operations. Servicer shall test each material discretionary change to the extent
Servicer believes necessary to determine that such change will not result in
adverse consequences to FMC. Upon request of FMC, Servicer will provide
reasonable information to FMC as to the nature and effect of the change.
4.3. System
Access.
FMC may
obtain access to the Student Loan files maintained on the Servicer's servicing
system by executing the Remote Time-Share Services Agreement.
4.4. Reports.
During
the term of this Agreement, the Servicer shall promptly and routinely furnish
FMC, sorted by SPE Owner, copies of all material reports, records, and other
documents and data as required by the Regulations or as otherwise required
by
this Agreement, including the reports listed in Schedule B. All correspondence
received by the Servicer relating to individual Borrower Accounts shall be
maintained by the Servicer as required under this Agreement and shall be made
available to FMC during Servicer’s normal business hours. The Servicer shall
furnish in good condition all forms and supplies as specified in the Schedule(s)
and any written and signed amendments thereto.
4.5.
Governmental
Reporting.
The
preparation and submission of any and all governmental reports or requests
for
data shall be the responsibility of FMC. The Servicer will, however, supply
supporting data and reports as required by this Agreement and the attached
Schedules or such other informa-tion as may be reasonably required under this
Agreement to enable FMC to fulfill Insurer or governmental reporting
requirements, and subject to the Management Information and Operations Staff
Services Support Fees under Section II.8(a) of the Fee Schedule attached hereto,
such information as may be reasonably required under this, in effect from time
to time.
4.6.
Reports
to Credit Bureaus.
The
Servicer shall provide any and all reports on Accounts serviced hereunder
required by the Regulations promulgated thereunder, as amended from time to
time, to the appropriate credit bureau or credit information service and shall
correct any errors caused by the incorrect reporting of information.
4.7.
Collections.
All
sums received by the Servicer with respect to any Student Loans, whether
attributable to principal or interest shall be received in trust for the benefit
of FMC. All funds received on behalf of Borrowers will be deposited in a
Servicer-owned and maintained clearing account, that is a separate account
in
which funds are not commingled with non-collection account funds. Within two
(2)
Business Days of receipt, or as mutually agreed upon, all available funds for
Student Loans will be electronically transmitted to an account designated by
FMC.
SECTION
5. AFFIRMATIVE COVENANTS
From
the
date hereof and until termination of this Agreement, the Servicer covenants
and
agrees to the following:
5.1. Custody
Procedure.
The
Servicer shall hold all promissory notes and related documents Serviced
hereunder on behalf of FMC and the secured party, if any, under the applicable
Securitization Transaction. The Servicer shall maintain all original promissory
notes in a fire resistant vault equipped with a security locking system.
Microfilm of all promissory notes and related documents shall be maintained
on-site at the Servicer's Servicing center located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and at an off-site facility in a fire resistant
vault with a security locking system. FMC or designated agent shall have the
right to inspect all security procedures during Servicer’s regular business
hours. The Servicer will provide FMC with sixty (60) days advance notice of
any
change in the physical location, external to the Servicer's Servicing center,
including a relocation of the Servicer's Servicing center, of the promissory
notes and related documents. All promissory notes at all times shall be stored
in a state other than the State of Louisiana.
5.2. Laws
and Regulations.
The
Servicer shall perform all of its obligations hereunder in accordance with
the
Regulations, and agrees to Service the Student Loans in accordance with
applicable laws which pertain to the Servicing thereof.
5.3. Government
Approvals.
The
Servicer shall remain duly qualified to do business in all jurisdictions
necessary to carry out its obligations under this Agreement.
5.4. Insurance.
The
Servicer shall, at all times and at the Servicer's cost and expense, keep in
full force and effect a Fidelity and Crime Policy covering employee theft as
issued on behalf of the Commonwealth of Pennsylvania. The Servicer shall also
maintain an Employee Liability Self-Insurance Program coverage as issued on
behalf of the Commonwealth of Pennsylvania and such coverage shall be limited
to
$250,000.00 on any one loss. At the time of execution of this Agreement, the
Servicer shall provide FMC with a copy of said policy upon FMC's request.
5.5. Financial
Reports of Servicer. The
Servicer will provide for an independent, annual audit of its financials, an
annual third party review of the Servicer's Student Loan Servicing system and
an
annual review of agreed upon procedures on the Servicer's third party Servicing
operations, upon request by FMC, within sixty (60) days of publication. FMC
warrants to the Servicer that such audits and financial statements shall not
be
disclosed or in any way communicated to third parties without the express
written consent of the Servicer, other than to FMC's legal counsel and to
employees of FMC directly concerned with this Agreement, all of whom will be
bound by this confidentiality provision and that of Section 11.7 of this
Agreement.
5.6. Annual
Statement as to Compliance.
The
Servicer shall deliver an annual report to FMC and the Trustee on or prior
to
March 31 of each year commencing March 31, 2002, signed by a Servicing officer
of the Servicer, stating that (a) a review of the activities of the Servicer,
and the Servicer’s performance under this Agreement, for the previous twelve
(12) months ending December 31 has been made under such Servicing officer’s
supervision and (b) certifying to the best of such officer’s knowledge, based on
such review, the Servicer has or has caused to be performed all of its
obligations under this Agreement throughout such year and that no default has
occurred, or, if such a default has occurred and is continuing, specifying
each
such event, the nature and status thereof and the steps necessary to remedy
such
affair.
5.7. Annual
Independent Public Accountant’s Servicing Reports.
The
Servicer shall cause a firm of independent public accountants to furnish to
FMC
and the related Trustee on or before March 31 of each year, commencing March
31,
2002, a report relating to the previous twelve (12) months ending December
31 to
the effect that such accountants have examined this Agreement, the Regulations,
and records relating to the Servicing of the Student Loans (which procedures,
manuals and records shall be described in one or more schedules to such
statement), that such accountants have compared the information contained in
the
Servicer’s reports in the relevant period with information contained in the
accounts and records relating to the Servicing of the Student Loans for such
period, and that, on the basis of such examination and comparison, nothing
has
come to the attention of such accountants to indicate (i) that the Servicing
of
the Student Loans has not, during the relevant period, been in compliance with
the Regulations and in accordance with this Agreement, (ii) that such accounts
and records have not been maintained in accordance with this Agreement, (iii)
that the information contained in the Servicer’s reports does not reconcile with
the information contained in such accounts and records or (iv) that the
Servicer’s reports or the accounts and records have not been properly prepared
and maintained in all material respects, except in each case for (a) such
exceptions as such accountants shall believe to be immaterial and (b) such
other
exceptions as shall be set forth in the Servicer’s reports. All costs associated
with the performance of the report of either the public accounting firm or
the
Servicer shall be paid by FMC.
SECTION
6. CHARGES AND PAYMENTS
6.1. Rate
Change.
The
Servicer shall provide all aspects of the Services at its sole cost and expense,
except as otherwise provided by this Agreement, and shall be compensated as
set
forth herein and in the Fee Schedule attached hereto. To the extent that an
increase occurs in the costs incurred by the Servicer in providing the Services
hereunder whether due to: (a) changes in the Regulations, (b) legislative and
regulatory changes beyond the control of the Servicer which pertain to the
manner of servicing of the Student Loans in accordance with Section 5.2 herein,
(c) changes in United States Postal Service postage rates, (d) material changes
requested by FMC in the Services provided herein, the Servicer shall have the
right to make a compensating increase to the Servicing fees set forth herein
and
in the Fee Schedule. The Servicer shall give FMC thirty (30) days prior written
notice before implementing any such increase in Servicing fees pursuant to
this
Section 6.1.
6.2. Invoices.
Invoices for the Servicer's Services shall be rendered by the Servicer after
each month end with payment to be paid by FMC within twenty (20) days of the
invoice date. If full payment is not received within thirty (30) days of the
invoice date, except as to amounts which are under dispute, the Servicer may
assess an interest charge of 1.25% per month (15% Annual Percentage Rate) on
the
unpaid balance from the date of initial billing until fully paid. If full
payment is not received within sixty (60) days from the date of the invoice,
except as to amounts which are under dispute, such non-payment shall constitute
a default hereunder and shall entitle the Servicer at any time thereafter,
to
notify FMC (and any affected Permitted Assignee named in a Servicing Consent
Letter) of such default and if such default is not cured within thirty (30)
days
from the date of such notice, the Servicer at its option, may immediately
terminate this Agreement. FMC shall report any disputes to the Servicer
regarding an invoice for Services hereunder, within sixty (60) days of the
invoice date, and the Servicer shall research FMC’s account and respond to FMC.
If FMC does not report any disputes regarding an invoice for Servicing within
sixty (60) days of the invoice date, FMC is deemed to have accepted the invoice
and the amount due and payable therein, and the Servicer shall not be
responsible for researching FMC’s account, regarding such invoice,
thereafter.
SECTION
7. REPRESENTATIONS AND WARRANTIES
The
Servicer represents and warrants to FMC (and these warranties and
representations shall be deemed continuing and repeated as of the date each
Student Loan shall become subject to this Agreement) as follows:
7.1. Existence.
The
Servicer is a public corporation duly organized and validly existing and in
good
standing under the laws of the Commonwealth of Pennsylvania, and is duly
qualified to do business in all jurisdictions where its failure to so qualify
would materially impair its ability to perform its obligations under this
Agreement.
7.2. Right
to Act.
No
registration with or approval of any governmental agency (except for approval
as
to form and legality by the Attorney General for the Commonwealth of
Pennsylvania) is required for the due execution and delivery or enforceability
of this Agreement. The Servicer has legal power to execute and deliver this
Agreement under the laws of Pennsylvania and to perform such Services and
observe the provisions herein under the laws of Pennsylvania. By executing
and
delivering this Agreement, and by performing and observing the provisions of
this Agreement, the Servicer will not violate any existing provision of its
Articles of Incorporation or its bylaws or any applicable law or violate or
otherwise become in default under any existing contract or other obligation
binding upon the Servicer. The officers executing and delivering this Agreement
have been duly authorized to do so, and this Agreement is legally binding upon
the Servicer and enforceable against the Servicer in every respect.
SECTION
8. LIABILITY
The
Servicer agrees to pay for any claim, loss, liability or expense, including
reasonable attorney's fees, which arises out of or relates to the Servicer's
acts or omissions with respect to the Services provided under this Agreement
(including, without limitation, any refusal of the Insurer to pay any claim
based on Servicer’s failure to conform to the Regulations), where the final
determination of liability on the part of the Servicer is established by an
arbitrator, by a court of law or by way of settlement agreed to by the Servicer.
This provision shall not be construed to limit the Servicer's or FMC's rights,
obligations, liabilities, claims or defenses which arise as a matter of law
or
pursuant to any other provision of this Agreement. This provision shall take
effect as of the date on which each individual Student Loan is converted to
the
Servicer's servicing system and shall apply to default claims rejected or paid
subject to penalty due to errors on the part of the Servicer which occur after
the date of conversion to the Servicer's system.
The
maximum liability on the part of the Servicer under this Agreement for all
losses incurred by FMC on Student Loans Serviced by the Servicer as a result
of
Servicing deficiencies shall not exceed ten percent (10%) of the aggregate
initial principal amount of all loans serviced by the Servicer and securitized
by FMC or its affiliate The National Collegiate Trust, a Delaware business
trust.
FMC
agrees to pay for any claim, loss, liability or expense, including reasonable
attorney’s fees and court costs, arising out of or relating to FMC’s acts or
omissions with respect to the Student Loans covered by this Agreement, where
the
final determination of liability on the part of FMC is established by an
arbitrator, by a court of law or by way of settlement agreed to by FMC. This
provision shall not be construed to limit FMC’s or the Servicer’s rights,
obligations, liabilities, claims or defenses which arise as a matter of law
or
pursuant to any other provision of this Agreement.
SECTION
9. FORCE MAJEURE
If
either
party is rendered unable, wholly or in part, by a force of nature outside the
control of the parties (including, but not limited to, acts of God, acts of
war,
epidemics, fire, earthquakes or other disasters) to carry out its obligations
under this Agreement, that party shall give to the other party prompt written
notice to that effect; upon receipt of the written notice, the affected
obligations of the party giving the notice shall be suspended so long as such
party is unable to so perform and such party shall have no liability to the
other for the failure to perform any suspended obligation during the period
of
suspension; however, the other party may at its option terminate this Agreement
if the inability to perform continues for a period in excess of twenty (20)
days. The foregoing provision is not intended to relieve the Servicer of its
obligations to maintain a plan as set forth in Section 11.12
herein.
SECTION
10. DISPUTES
In
the
event of any dispute or disagreement between the parties hereto either with
respect to the interpretation of any provision of this Agreement or with respect
to the performance hereunder by the Servicer or by FMC, each of the parties
will
appoint, no later than thirty (30) days after the dispute or disagreement has
arisen as evidenced in writing by one of the parties, a designated officer
to
meet for the purpose of endeavoring to resolve such dispute or to negotiate
for
an adjustment to such provision. In case no agreement is reached, a third
designated person may be appointed upon mutual agreement to resolve such dispute
or to negotiate with the previously designated officers to negotiate for an
adjustment to such provision. No formal proceedings for the judicial resolution
of the initially designated dispute may be commenced until either of the
designated officers concludes in good faith that amicable resolution through
continued negotiations of the matter in issue does not appear likely. In no
event shall such dispute resolution procedure continue for more than sixty
(60)
days after the appointment of the initially designated officers, after which
period of time FMC may choose to seek a final determination of liability on
the
part of the Servicer by a court of law as set forth in Section 8 herein.
SECTION
11. MISCELLANEOUS PROVISIONS
11.1.
Inspections.
The
Servicer and the Services and all records and reports specifically relating
thereto shall be subject to review, audit and copying by FMC, its designated
representative and/or the Comptroller of the Currency or any other regulatory
body or supervisory agency having jurisdic-tion over FMC, and external and
internal auditors, upon no less than sixty (60) days notice to the Servicer,
and
then at such times as are mutually agreed upon between FMC and the Servicer.
Such review, audit and copying shall be conducted, unless otherwise mutually
agreed upon, at the Servicer's principal office set forth above or as otherwise
maintained by the Servicer. On-site examination of documents held in safekeeping
and microfilm records or related documenta-tion will be performed with as little
disruption as possible to the Servicer's normal operation. All questions arising
during the course of the audit will be coordinated by the chief auditor and
directed to the individual(s) designated by the Servicer. The Servicer will
designate a sufficient number of liaison personnel so as to be able to respond
timely to audit questions. All FMC’s out-of-pocket expenses, non-Servicer
personnel costs and copying expenses relating to such review, audit and copying
shall be borne by FMC.
11.2.
Notices.
All
notices, approvals, consents, requests or other written communications regarding
this Agreement are to be addressed as noted below.
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If
to FMC:
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▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
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The
First Marblehead Corporation
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▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇▇,
▇▇ ▇▇▇▇▇
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If
to Servicer:
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Senior
Vice President, Marketing & Client Affairs
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Pennsylvania
Higher Education Assistance Agency
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▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
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11.3. Relationship.
The
parties to this Agreement intend that the Servicer shall render the Services
contemplated by this Agreement as an independent contractor. The Servicer and
its employees, agents, and servants are not to be considered agents or employees
of FMC, for any purpose whatsoever. Nothing herein contained, nor any action
taken by the Servicer under this Agreement, shall be deemed or construed to
give
the Servicer any right, title or interest either in law or in equity in and
to
any Student Loan Account being Serviced by Servicer.
11.4. Assignments.
Assignment of Servicing and Future Servicing after Sale of Student Loans.
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(i)
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Assignment
by the Servicer.
This Agreement and all the rights and obligations of the Servicer
hereunder may not be assigned or subcontracted by the Servicer without
the
prior written consent of FMC which consent shall not be unreasonably
withheld; provided however, the Servicer may subcontract for skiptracing
purposes without such consent. FMC's consent to subcontract shall
not
release the Servicer from its obligations under this
Agreement.
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(ii)
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Assignment
to Permitted Assignee.
As
described in the Program Guidelines, the parties contemplate that:
(a)
pools of Student Loans will be sold by the Program Lender to SPEs
in
Securitization Transactions sponsored by FMC from time to time, and
Permitted Assignees will receive a collateral assignment of the Student
Loans in each Securitization Transaction; and (b) at the same time
and as
part of the same transaction, FMC will assign its rights under this
Agreement to obtain Servicing of said Student Loans to said SPEs,
which
rights may be further assigned to Permitted Assignees, so that said
Student Loans will be Serviced by Servicer under the terms of this
Agreement, following execution by the parties of a Servicer Consent
Letter
substantially in the form of Schedule A. Servicer agrees that upon
the
assignment of FMC’s rights under this Agreement with respect to a pool of
Student Loans to a Permitted Assignee and the execution by the parties
of
a Servicer Consent Letter, all obligations of FMC under this Agreement
with respect to such Student Loans, including without limitation
the
obligation to pay fees set forth in the Fee Schedule, shall cease
and all
rights and obligations of FMC under this Agreement with respect to
such
Student Loans shall inure to the SPE and the Permitted
Assignees.
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| (iii) |
Notice
Requirement prior to Sale of Student Loans.
FMC shall use reasonable efforts to notify the Servicer, in writing,
sixty
(60) days prior to any sale of Student Loans, currently housed on
the
Servicing system as to (a) the anticipated sale date and (b) the
characteristics of the exact Student Loans to be sold. The actual
sale
date will be provided five (5) days prior to the sale. Upon receipt
of the
above initial notice, the Servicer will provide FMC with available
transfer dates within thirty (30) days. Actual transfer dates shall
be
mutually agreed upon.
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(iv)
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Servicing
Obligations after Sale of Student Loans.
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(a)
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The
Servicer's Offer of Continued Servicing.
With respect to any Student Loans which are sold, assigned or transferred
by a Permitted Assignee, upon the Servicer's receipt of a notice
from such
Permitted Assignee that it intends to sell, assign or transfer any
or all
of the Student Loans which are being Serviced hereunder, the Servicer
shall contact the intended purchaser, assignee or transferee
(collectively, the "Transferee") and offer to Service such Student
Loans
for the Transferee for the balance of the term of this Agreement
(and, at
the option of the Transferee, any extensions thereof) as follows:
(1)
under terms and conditions which are no less favorable than those
terms
and conditions which are contained in this Agreement; and (2) if
the
Transferee or an affiliate, parent, subsidiary or other entity related
to
the Transferee (collectively, a "Related Entity") has entered into
a
servicing agreement with the Servicer, under the terms and conditions
of
any such agreement. This subsection shall not apply to an assignment
to a
Permitted Assignee pursuant to subsection
11.4(ii).
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(b)
|
Liability
of Permitted Assignee upon Transferee's Acceptance of Servicer's
Offer to
Service Student Loans.
|
|
If
the Transferee accepts the offer described in subsection (iv)(a)(1)
or
(iv)(a)(2), the Permitted Assignee shall have no further obligation
or
liability to the Servicer hereunder with respect to such Student
Loans,
and the Early Termination Fees set forth in the Fee Schedule shall
not be
due and payable. If the Transferee does not elect to have the Servicer
continue Servicing the Student Loans, the Permitted Assignee shall
pay the
Early Termination Fees set forth in the Fee Schedule. This subsection
shall not apply to an assignment to a Permitted Assignee pursuant
to
subsection 11.4(ii).
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11.5. Limitation
of The Servicer's Rights.
Nothing
contained herein, nor any action taken by the Servicer under this Agreement,
shall be deemed or construed to give the Servicer any right, title or interest
either in law or equity in and to any Student Loans Serviced
hereunder.
11.6. Exclusive
Agreement.
Nothing
contained herein shall be construed to create an exclusive arrangement between
the parties, and the Servicer understands and agrees that FMC may enter into
other agreements for Servicing Student Loans in the future.
11.7. Confidential
Information.
During
the term of this Agreement, and thereafter, each party and its respective agents
and employees will maintain the confidentiality of all data, materials and
information disclosed and entrusted to it by the other party which relate to
the
business relationship of the parties. The Servicer agrees to keep the names
and
addresses of Borrowers in strictest confidence, except as shall be necessary
to
communicate the information to its officers and employees or to FMC in
connection with its obligations under this Agreement and except as required
by
applicable law or Regulations. Specifically and without limitation:
(a) In
accordance with Title V of the ▇▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act (the “GLB Act”) and
Federal Reserve Board Regulation P (“regulation P”), Servicer agrees to respect
and protect the security and confidentiality of any “nonpublic personal
information” (as defined in the GLB Act and Regulation P) it receives concerning
Student Loans and Borrowers including, where applicable, the restrictions on
the
re-use and disclosure of such information set forth in the GLB Act and
Regulation P.
(b) Servicer
agrees to use all information it receives concerning Student Loans and Borrowers
including, without limitation, nonpublic personal information described in
Section 11.7(a), solely for purposes of providing the Services.
Nothing
in this Section shall restrict or prohibit FMC or any Permitted Assignee from
disclosing the existence or content of this Agreement in connection with
required disclosures for a Securitization Transaction.
11.8. Survival
of Warranties and Obligations.
The
representations and warranties of the Servicer shall survive the termination
of
this Agreement and the obligations and duties of the Servicer shall survive
the
termination of this Agreement as set forth in this Agreement.
11.9.
Entire
Understanding.
This
Agreement herewith including all Exhibits attached thereto, represent the entire
understanding of the parties with respect to their subject matter, and supersede
all previous discussions and correspondence with respect thereto, and no
representations, warranties or agreements, express or implied, of any kind
with
respect to such subject matter have been made by either party to the other,
except as expressly set forth herein or in such other agreements.
11.10.
Taxes.
FMC
shall be responsible for the payment of Pennsylvania Sales Tax on the Services
provided hereunder, if applicable. However, Servicer represents and warrants
that as of the date of this Agreement, with respect to the Services provided
for
herein, no such sales tax is due.
11.11.
Interpretation
of Documents.
In the
event of a conflict between the Servicing Agreement and the Exhibits attached
hereto, the Servicing Agreement shall control.
11.12.
Disaster
Recovery Plan. The
Servicer agrees to maintain a viable disaster recovery plan for the Services
which includes, among other things, provision for the remote storage of computer
software and data, for the remote storage of copies of loan documentation,
the
availability of a location for off-site computer services and for the time
frames within which the Services may be resumed. The Servicer shall periodically
test the data processing functions of its disaster recovery plan and shall
update in a timely manner (it being the Servicer's present intentions to test
annually) such disaster recovery plan. Upon request from FMC, the Servicer
shall
provide FMC with a summary report of the results of such testing. FMC, or its
designated representative, shall be entitled to review such disaster recovery
plan from time to time during the term of this Agreement at the Servicer's
place
of business. In the event of a natural or other disaster beyond the Servicer's
control that interrupts the Servicer's performance of any such Services for
any
period, the Servicer shall promptly respond to such disaster in accordance
with
the procedures contained in the disaster recovery plan in order to resume
performance of such Services.
11.13.
Reports.
The
Servicer shall, without additional charge or cost to FMC, prepare by
Securitization Transaction, and deliver to FMC such monthly, quarterly or annual
reports for Student Loans Serviced by the Servicer as set forth in Schedule
B.
11.14. Cooperation.
FMC and
the Servicer agree that they will cooperate fully with one another in order
to
carry out the terms and provisions of the Agreement during the term of this
Agreement and during all periods in which Student Loans are processed and
Serviced by Servicer. Cooperation under this Section shall include, but not
be
limited to, each party using reasonable means to ensure successful, normal,
daily processing of Student Loans and related operations and functions. Each
party agrees to support the reasonable routine efforts of the other party and
to
work to resolve any disputes which may arise during such periods referenced
above, and to continue to work together in a professional, business-like manner
during all phases, functions and processes defined in this
Agreement.
11.15. Authorization.
Each of
the undersigned represent that he or she has the authority to execute this
Agreement on behalf of the respective party.
11.16. Amendments;
Changes; Modifications.
This
Agreement, Exhibits or Schedules (a) may be amended, supplemented, or modified
only by written instrument duly executed by FMC and the Servicer; (b) shall
be
incorporated into this Agreement (c) shall be binding upon and shall inure
to
the benefit of the parties hereto and their respective successors and assigns;
and (d) except as provided in Section 12 hereof, may not be terminated or
assigned by any party hereto without the prior written consent of the other
parties provided however the Servicer may subcontract for collections and
skiptracing purposes without prior written consent of FMC.
11.17. No
Waiver. Any
failure by FMC or the Servicer to insist upon the strict performance by the
other of any of the terms and provisions of this Agreement shall not be deemed
to be a continuing waiver of any such terms and provisions, and notwithstanding
any such failure, such party shall have the right thereafter to insist upon
the
resumption of strict performance by the other of any and all of the terms and
provisions hereof. The rights and remedies herein provided are cumulative and
not exclusive of any rights or remedies provided by law.
11.18.
Opinion
of Outside Counsel.
At the
time of the execution of this Agreement the Servicer agrees to provide to FMC
an
opinion of its outside counsel, in form and substance satisfactory to counsel
for FMC, that the representations and warranties set forth in Section 7.2 are
true and correct.
SECTION
12. TERMINATION
12.1.
Borrower’s
Student Loan.
This
Agreement shall terminate as to a specific Borrower's Student Loan at the close
of the month during which the principal, interest, and late charges, if any,
have been fully paid and remitted to FMC, the Borrower has been notified that
the Student Loan has been paid in full, or at the close of the month during
which notification is given to the Servicer that a claim for guarantee/insurance
relating to the Student Loan has been paid by the Guarantor, or upon the sale
or
transfer of a specific Borrower's Student Loan where the Servicer does not
continue Servicing such Student Loan subject to the provisions set forth in
Section 11.4 herein.
12.2.
Termination
by FMC.
This
Agreement may be terminated at the option of FMC without charge to FMC upon
the
occurrence of any of the following:
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|
(i)
|
Any
of the representations or warranties made in or pursuant to this
Agreement
are not true or erroneous in any material
respect;
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|
|
(ii)
|
The
Servicer's failure to perform or observe any of the provisions or
covenants of this Agreement in any material
respect;
|
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(iii)
|
If
the Servicer shall (a) discontinue business, or (b) generally not
pay its
debts as such debts become due, or (c) make a general assignment
for the
benefit of creditors, or (d) admit by answer, default or otherwise
the
material allegations of petitions filed against it in any bankruptcy,
reorganization, insolvency or other proceedings (whether federal
or state)
relating to relief of debtors, or (e) suffer or permit to continue
unstayed and in effect for thirty (30) consecutive days, any judgement,
decree or order, entered by a court of competent jurisdiction, which
approves a petition seeking its reorganization or appoints a receiver,
custodian, trustee, interim trustee or liquidator for itself or all
or a
substantial part of its assets, or (f) take or omit any action in
order
thereby to effect any of the
foregoing;
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In
the
event of an event of default as set forth in Section 12.2(i) or (ii) above,
the
Servicer shall have the right to cure any such breach or error to FMC's full
satisfaction within one hundred and twenty (120) days of written notice from
FMC.
In
the
event FMC fails to cure such default and the Agreement is terminated pursuant
to
Section 12.2(i), (ii) or (iii), or in the event that this Agreement is
terminated pursuant to Section 12.1 as to a given Student Loan when said Student
Loan is paid in full, there will be no charge to FMC for Early Termination
Fees
or Record Return/Deconversion Fees. In the event the Agreement is terminated
prior to the end of the initial term for any reason other than stated above,
FMC
shall be responsible for the payment of Early Termination Fees as detailed
in
the Fee Schedule.
12.3.
Termination
by the Servicer.
This
Agreement may be terminated at the option of the Servicer upon the occurrence
of
any of the following:
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(i)
|
FMC's
failure to perform or observe any of the material provisions or covenants
of this Agreement which affect the Servicer's ability to
perform;
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(ii)
|
If
FMC shall (a) discontinue business, or (b) generally not pay its
debts as
such debts become due, or (c) make a general assignment for the benefit
of
creditors, or (d) admit by answer, default or otherwise the material
allegations of petitions filed against it in any bankruptcy,
reorganization, insolvency or other proceeding (whether federal or
state)
relating to relief of debtors, or (e) suffer or permit to continue
unstayed and in effect for thirty (30) consecutive days, any judgement,
decree or order, entered by a court of competent jurisdiction, which
approves a petition seeking its reorganization or appoints a receiver,
custodian, trustee, interim trustee or liquidator for itself or all
or a
substantial part of its assets, or (f) take or omit any action in
order
thereby to effect any of the
foregoing;
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| (iii) |
Pursuant
to Section 6.2 of this Agreement.
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In
the
event of an event of default as set forth in Section 12.3(i) or (ii) above,
FMC
shall have the right to cure any such breach or error to Servicer’s full
satisfaction within one hundred and twenty (120) days of written notice from
Servicer.
In
the
event the Servicer fails to cure such default and the Agreement is terminated
pursuant to Section 12.3(i), (ii) or (iii), FMC shall pay Servicer the Early
Termination Fee set forth in the Fee Schedule.
12.4. Record
Return/Deconversion.
Upon
termination of this Agreement or upon termination of this Agreement with respect
to any particular Student Loan or Loans whether by virtue of the passage of
time
or otherwise, the Servicer shall, regardless of any FMC default or any other
reason, return to FMC all records, data processing records, reports, documents
and correspondence, including original promissory notes, applications, payment
histories, due diligence histories, and copies of microfilm documents maintained
by the Servicer in connection with the Servicing of the Student Loans to which
the Servicer asserts no legitimate proprietary right or which are not part
of
the records and reports maintained by the Servicer in connection with the
Servicing of Student Loans generally. Upon the return of the Student Loan
records belonging to FMC, FMC agrees to pay the Record Return/Deconversion
Fee,
as set forth in the Fee Schedule, to the Servicer, except under the
circumstances specifically set forth in this Agreement, and such records will
be
returned to FMC by Servicer within sixty (60) days from the date of termination
of this Agreement or as otherwise mutually agreed upon by the parties; provided,
however, that in the event this Agreement is terminated by FMC pursuant to
Section 12.2(i), (ii), or (iii), then the Servicer shall return the records
at
its sole cost and expense and no Record Return/Deconversion Fee shall be
payable.
SECTION
13. LAW GOVERNING
This
Agreement is being delivered in and shall be construed in accordance with the
laws of the Commonwealth of Pennsylvania, without regard to any principles
of
conflict of laws.
IN
WITNESS WHEREOF, the parties hereto have caused this instrument to be duly
executed as of the month, day and the year first-above written.
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PENNSYLVANIA
HIGHER EDUCATION
ASSISTANCE
AGENCY
|
THE
FIRST MARBLEHEAD
CORPORATION
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|||
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By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
By:
|
/s/
▇▇▇▇▇ ▇▇▇▇▇
|
|
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
|
Name:
|
▇▇▇▇▇
▇▇▇▇▇
|
|
|
Title:
|
President
and CEO
|
Title:
|
COO
|
|
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Date:
|
November
1, 2001
|
Date:
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10-16-01
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|
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043295311
|
||||
|
Federal
Tax Identification Number
|
||||
|
Approved
as to form and legality.
|
Approved
as to form and legality.
|
|
|
/s/
▇▇▇▇▇▇ ▇▇▇ Lard
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/s/
[Illegible]
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|
|
PHEAA
Legal Counsel
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Pennsylvania
Deputy Attorney General
|
FEE
SCHEDULE FOR
ALTERNATIVE
SERVICING AGREEMENT
DATED
October 16, 2001
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
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I.
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DEFINITIONS
|
In
addition to the words and terms elsewhere defined in this Agreement, the
following terms shall have the following meanings unless the Agreement indicates
a contrary meaning or intent:
|
A.
|
An
"Account" is to refer to the promissory notes collectively of an
individual Borrower of a particular Student Loan type in the same
status
and having the same Guarantor.
|
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B.
|
An
"Interim Account" is to refer to promissory notes collectively of
an
individual Student Loan Borrower (1) constituting an In-School (Enrolled)
Account, or (2) a Grace Account.
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C.
|
A
"Repayment Account" is to refer to the promissory notes of an individual
Student Loan Borrower under the terms of which the repayment period
has
commenced, and includes Accounts in deferment or forbearance.
|
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D.
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A
"In-School (Enrolled) Account" is to refer to the promissory notes
collectively of an individual Student Loan Borrower (1) with respect
to
which the Borrower is enrolled at an eligible institution on at least
a
half--time basis, and (2) under the terms of which the repayment
period
has not yet commenced.
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E.
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A
"Grace Account" is to refer to the promissory notes collectively
of an
individual Student Loan Borrower (1) with respect to which the Borrower
has ceased to be enrolled in an eligible institution on at least
a
half-time basis, and (2) under the terms of which the repayment period
has
not yet commenced.
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F.
|
"Standard
Conversion" means the conversion of a Borrower's Account from data
provided in hard-copy format or on magnetic tape.
|
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G.
|
"On-System
Conversion" means the conversion of a Borrower's Account which the
Servicer is currently Servicing for an owner or holder other than
the
current owner or holder.
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H.
|
“Student
Loan” is to refer to Student Loans serviced under the terms of the
Alternative Servicing Agreement between Servicer and FMC dated
________________ __, 2001 and serviced in accordance with the Program
Guidelines as defined in such
Agreement.
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II.
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SERVICING
FEES
|
1. Monthly
Servicing Fees - Interim Account Status:
The
Servicing fee for Student Loans in Interim Account Status shall be payable
by
the Owner on a pro-rated monthly basis and shall be equal to [**] basis points
per annum based upon the ending principal balance at each month
end.
([**]
x
ending principal balance at month end divided by [**])
2. Monthly
Servicing Fees - Repayment Account Status:
The
Servicing fee for loans in Repayment Account Status shall be payable by the
Owner on a pro-rated monthly basis and shall be equal to [**] basis points
per
annum based upon the ending principal balance at each month end:
([**]
x
ending principal balance at month end divided by [**])
3. Return
of
Records/Deconversion
The
Owner
shall pay for the return of Student Loan records belonging to the Owner, upon
termination of this Agreement or with respect to any particular Student Loan,
to
the extent provided for under Section 12.4 of the Agreement, at its own cost
and
expense, not to exceed $[**] per Student Loan file.
4. Claim
Processing Fee
The
Owner
shall pay the claim processing fee for defaulted Student Loans at the rate
of
$[**] per claim package filed.
Claim
processing shall include, without limitation, presentation to Insurer of all
documentation required under the Program Guidelines, in the form required
thereunder.
5. Cure
Servicing Fees:
The
Owner shall pay Cure Servicing fees as follows:
(a) For
Owner
Caused Cures,
(i) Monthly
per Account Servicing fee;
(ii) $[**]
per
Account for skiptracing activities, including letters and phone calls, if
located;
(iii) $[**]
per
Account if referred to a third party under contract with the Servicer for
Cure/collection after successful location; and
(iv) $[**]
per
Account if the guarantee is reinstated or a default claim is paid;
or
(v) $[**]
per
Account if deconverted and returned to the Owner.
(b) For
Servicer Caused Cures, the Owner shall pay monthly, per Account, the Servicing
fees as set forth in this Schedule. Any Servicing deficiency that voids or
limits the guaranty under the Program Guidelines shall constitute a Servicer
Caused Cure.
6. Servicing
Fees for Reinstatement of Accounts to Servicer’s Servicing
System
The
Owner
shall pay a fee of [**] dollars ($[**]) per Student Loan Account to reinstate
such Student Loan to Servicer’s Servicing system, including, but not limited to
defaulted Student Loans, and later reconverted to the Servicer’s Servicing
system.
7. Miscellaneous
Expenses
An
additional amount for miscellaneous expenses will be billed for Services
requested by the Owner, such as document transferal, special computer reports,
mail and shipping costs, etc., not otherwise required to be furnished. Fees
for
computer projects will be billed at the following rates:
|
(a)
|
Staff
Services
|
-
|
$[**]
per hour
|
|
|
(b)
|
Computer
Programmer
|
-
|
$[**]
per hour
|
|
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(c)
|
Computer
Analyst
|
-
|
$[**]
per hour
|
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(d)
|
Computer
Clock Hour
|
-
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$[**]
per hour
|
III. EARLY
TERMINATION FEES
In
the
event Owner is required pursuant to the Agreement to pay an Early Termination
Fee, such Fee shall be assessed and paid to Servicer as follows:
A. $[**]
per
Account during the first year of the Agreement;
|
B.
|
$[**]
less the product of ([**] percent ([**]%)X the number of years or
portions
thereof that this Agreement has been in effect X $[**]) per Account
anytime after the first year of the
Agreement.
|
|
PENNSYLVANIA
HIGHER EDUCATION
ASSISTANCE
AGENCY
|
THE
FIRST MARBLEHEAD CORPORATION
|
|||
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
By:
|
/s/
▇▇▇▇▇ ▇▇▇▇▇
|
|
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
|
Name:
|
▇▇▇▇▇
▇▇▇▇▇
|
|
|
Title:
|
President
& CEO
|
Title:
|
COO
|
|
|
Date:
|
Date:
|
10-16-01
|
||
SCHEDULE
A TO
ALTERNATIVE
SERVICING AGREEMENT
DATED
October 16, 2001
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
SERVICER
CONSENT LETTER
[DATE]
Pennsylvania
Higher Education Assistance Authority
▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention:
Senior Vice President, Marketing and Client Relations
Dear
________:
Reference
is hereby made to the Alternative Servicing Agreement, dated [Date], as amended,
(the “Servicing Agreement”) by and between Pennsylvania Higher Education
Assistance Authority (the “Servicer”) and The First Marblehead Corporation
(“FMC”), a copy of which is attached hereto as Exhibit A. Capitalized terms not
otherwise defined herein shall have the meanings set forth in the Servicing
Agreement. The parties hereto agree as follows:
|
1.
|
FMC
hereby assigns its interest in the Servicing Agreement with respect
to the
Student Loans identified on the attached Schedule 1 (the “Student Loans”)
to [Name of Securitization SPE] (“SPE”), and Servicer hereby consents
thereto.
|
|
2.
|
Servicer
hereby consents to the assignment and to the grant by [SPE] of a
security
interest in the Servicing Agreement to [Name of Securitization
Trustee](the “Trustee”), as provided in the Indenture, dated as of [Date]
between [SPE] and the Trustee (the “Indenture”), for the benefit of the
holders of obligations of the SPE and MBIA Insurance Corporation
(the
“Bond Insurer”).
|
|
3.
|
Servicer
hereby confirms that it will not terminate the Servicing Agreement
until
the appointment of a successor servicer by [SPE], with the consent
of the
Bond Insurer for so long as Bonds are outstanding, unless such termination
is due to a default by SPE under Section 6.2 or 12.3 thereof, or
unless
the Servicing Agreement otherwise expires in accordance with Section
12.1
thereof.
|
|
4.
|
[SPE]
hereby confirms that (i) it will not terminate Servicer for cause
pursuant
to Section 12.2 of the Servicing Agreement (a) without the consent
of the
Bond Insurer for so long as Bonds are outstanding, and (b) until
a
successor servicer acceptable to the Bond Insurer is appointed, and
(ii)
it will terminate Servicer for cause pursuant to Section 12.2 of
the
Servicing Agreement, if directed by the Bond Insurer to do
so.
|
|
5.
|
Servicer
hereby confirms that it has complied with all the terms and satisfied
all
the conditions on its part to be performed or satisfied under the
Servicing Agreement.
|
|
6.
|
Servicer
hereby agrees to provide the Bond Insurer with copies of all notices,
reports and other information at the same time and in the same manner
in
which such information is required to be given to FMC and [SPE] pursuant
to the Servicing Agreement or other information as is reasonably
requested
by the Bond Insurer, if such other information is available to Servicer
at
the time of such requests. In addition, for so long as any Bonds
are
outstanding, any action that requires the consent of [SPE] under
the
Servicing Agreement, including without limitation, any amendment
to the
Servicing Agreement with respect to the Student Loans, shall also
require
the prior consent of the Bond
Insurer.
|
|
7.
|
Servicer
hereby agrees to provide the Bond Insurer, upon request, with its
annual
audited financial statements and its quarterly unaudited financial
statements.
|
|
8.
|
Servicer
hereby grants the Bond Insurer the right for so long as any of the
Bonds
remain outstanding, to perform ongoing due diligence review of Servicer’s
Servicing activities with respect to the Student Loans; provided
that,
such due diligence be conducted in a reasonable manner, convenient
to both
Servicer and the Bond Insurer. All costs associated with the performance
of the due diligence review shall be paid by the
SPE.
|
9. It
is
expressly understood and agreed by the parties hereto that (a) this Letter
is
executed and delivered by [Owner Trustee], not individually or personally,
but
solely as Owner Trustee of [SPE] under the Trust Agreement dated as of [Date],
with [SPE Sponsor], in the exercise of the powers and authority conferred and
vested in it, (b) each of the representations, undertakings and agreements
herein made on the part of the Trust are made and intended not as personal
representations, undertaking and agreements by the Owner Trustee, but are made
and intended for the purpose for binding only the Trust, (c) nothing herein
contained shall be construed as creating any personal or individual liability
on
the Owner Trustee, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties hereby
and by any person claiming by, through, or under the parties hereto, and (d)
under no circumstances shall the Owner Trustee be personally liable for the
payment of any indebtedness or expenses of the Trust or be liable for the breach
or failure of any obligation, representation, warranty or covenant made or
undertaken by the Trust under this Agreement or the other Trust Related
Documents.
10. The
parties hereto acknowledge and agree that for so long as any Bonds are
outstanding, the Bond Insurer is a third-party beneficiary hereof and of the
Servicing Agreement, and the Bond Insurer shall have the right to exercise
all
rights of [SPE] under the Servicing Agreement.
Please
acknowledge your acceptance and agreement to the foregoing by signing and
returning the enclosed duplicate letter.
|
Very
truly yours,
The
First Marblehead Corporation
|
|
|
By:
|
|
|
Name:
|
|
|
Title:
|
|
|
Accepted
and Agreed:
Pennsylvania
Higher Education Assistance Authority
|
|
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
|
Name:
|
|
|
Title:
|
|
|
[SPE
NAME]
By:
[Owner Trustee]
|
|
|
By:
|
|
|
Name:
|
|
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Title:
|
|
SCHEDULE
B TO
ALTERNATIVE
SERVICING AGREEMENT
DATED
OCTOBER 16, 2001
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
REQUIRED
REPORTS
| 1. |
Delinquency
Summary
|
| 2. |
Reconciliation
|
| 3. |
Loan
Summary - (Must be on a loan by loan basis at the borrower level
and be
provided once per month on a mutually agreed upon
schedule.)
|
| 4. |
Loan
Summary by Status
|
| 5. |
Transaction
Detail - (Must be on a loan by loan basis at the borrower level and
be
provided once per month on a mutually agreed upon
schedule.
|
FIRST
AMENDMENT TO ALTERNATIVE SERVICING AGREEMENT
This
First Amendment to Alternative Servicing Agreement amends that certain
Alternative Servicing Agreement dated as of October 16, 2001 ("Services
Agreement") by and between the PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY,
a public corporation and governmental instrumentality organized under the laws
of the Commonwealth of Pennsylvania, having an address at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Servicer") and THE FIRST MARBLEHEAD CORPORATION
("FMC") having an address at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
This First Amendment is dated as of November 1, 2001.
Capitalized
terms used in this First Amendment without definition have the meaning set
forth
in the Servicing Agreement.
The
Servicing Agreement is hereby amended as follows:
1. The
last
sentence of Section 4.7 is replaced with the following:
"Within
two Business Days of Receipt, all actually cleared available funds from Student
Loans will be electronically transmitted to an account designated by
FMC."
2. The
next
to the last paragraph of Section 12.2, immediately following Subsection (iii),
is amended by adding the following additional sentence:
"Notwithstanding
the foregoing, Servicer shall have the right to cure any breach of Section
4.7
of this Agreement within five (5) days (not 120 days) after written notice
from
FMC."
3. In
the
last paragraph of Section 12.2, in the first line, the word "FMC" is replaced
with the word "PHEAA."
4. The
following provision is added as a new final paragraph in Section 8.
If
the
Insurer rejects a claim on account of Servicer's failure to conform to the
Regulations in servicing a Student Loan, the Servicer will start the cure
process described in the Regulations for the purpose of reinstating Owner's
claim against the Insurer.) Student Loans in such status are hereinafter
referred to as Student Loans in "Cure Status". An indicator will be placed
in
the Student Loan record indicating the start (and the date) of Cure Status.
Within twelve months of the initiation of Cure Status, if Insurance has not
been
reinstated in accordance with the Regulations, the Servicer shall purchase
any
such Student Loan by paying to Owner an amount equal to [**]. The Owner will
assign its right, title, and interest in any promissory note to the Servicer
where the Servicer has purchased such note. Within thirty (30) days after a
final determination pursuant to Section 10 that Servicer was not responsible
for
causing the loss of Insurance, FMC
will
repurchase any and all such uninsured Student Loans for an amount equal to
the
purchase price plus any other costs incurred by Servicer in their
purchase.
5. In
all
other respects, the Servicing Agreement is hereby ratified and confirmed and
shall remain in full force and effect.
IN
WITNESS WHEREOF, the parties hereto have caused this instrument to be executed
as of November 1, 2001.
|
THE
FIRST MARBLEHEAD
CORPORATION
|
PENNSYLVANIA
HIGHER
EDUCATION
ASSISTANCE AGENCY
|
|||
|
By:
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
||
|
Name:
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
|
||
|
Title:
|
Title:
|
President
& CEO
|
||
|
Date:
|
Date:
|
11/5/2001
|
||
|
Approved
as to form and legality
|
Approved
as to form and legality
|
|||
|
/s/
▇▇▇▇▇▇ ▇▇▇ Lard
|
||||
|
PHEAA
Legal Counsel
|
Pennsylvania
Deputy Attorney General
|
|||
011210-11
SECOND
AMENDMENT TO ALTERNATIVE SERVICING AGREEMENT
This
Second Amendment to Alternative Servicing Agreement amends that certain
Alternative Servicing Agreement dated as of October 16, 2001 ("Services
Agreement") by and between the PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY,
a public corporation and governmental instrumentality organized under the laws
of the Commonwealth of Pennsylvania, having an address at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ("Servicer") and THE FIRST MARBLEHEAD CORPORATION
("FMC") having an address at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
This Second Amendment is dated as of November 1, 2001.
Capitalized
terms used in this Second Amendment without definition have the meaning set
forth in the Servicing Agreement.
The
Servicing Agreement is hereby amended as follows:
1. Subsection
12.2(ii) is amended by adding at the end the following
parenthetical:
"(including,
without limitation, any breach of the provisions of section 4.7, all of which
shall be deemed material)".
2. In
the
last sentence of section 12.1, the word "Guarantor" is replaced by the word
"insurer."
3. In
all
other respects, the Servicing Agreement is hereby ratified and confirmed and
shall remain in full force and effect.
IN
WITNESS WHEREOF, the parties hereto have caused this instrument to be executed
as of November 1, 2001.
|
THE
FIRST MARBLEHEAD
CORPORATION
|
PENNSYLVANIA
HIGHER
EDUCATION
ASSISTANCE AGENCY
|
|||
|
By:
|
/s/
▇▇▇▇▇ ▇▇▇▇▇
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
|
|
|
Name:
|
▇▇▇▇▇
▇▇▇▇▇
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇
|
|
|
Title:
|
President
|
Title:
|
President
& CEO
|
|
|
Date:
|
1/9/02
|
Date:
|
||
|
Approved
as to form and legality
|
Approved
as to form and legality
|
|||
|
/s/
▇▇▇▇▇▇ ▇▇▇ Lard
|
/s/[Illegible] | |||
|
PHEAA
Legal Counsel
|
Pennsylvania
Deputy Attorney General
|
|||
THIRD
AMENDMENT TO THE
ALTERNATIVE
SERVICING AGREEMENT
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
THIS
THIRD AMENDMENT is made this 1st of May, 2003, by and among the PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY, a public corporation and governmental
instrumentality organized under the laws of the Commonwealth of Pennsylvania,
having an address at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
(herein referred to as the "Servicer"), THE FIRST MARBLEHEAD CORPORATION, having
an address at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ and the Issuer
(as defined below) (said corporation and said Issuer being collectively referred
to herein as the "Owner").
RECITALS
WHEREAS,
the parties previously entered into a Alternative Servicing Agreement dated
October 16, 2001, as amended by the First Amendment dated November 1, 2001
and
as further amended by the Second Amendment dated November 1, 2001, and as
subsequently amended to add other Student Loans guaranteed by The Education
Resources Institute, Inc.(herein collectively referred to as the "Agreement"),
which sets forth the terms for the servicing of Student Loans owned by the
Owner
and serviced by the Servicer;
WHEREAS,
Servicer and Owner now wish to amend the Fee Schedule attached to the Agreement;
and
WHEREAS,
pursuant to a Servicer Consent Letter dated as of November 1, 2001, the rights
of Owner for servicing of certain Student Loans under this Agreement were
assigned to The National Collegiate Master Student Loan Trust I, a Delaware
business trust ("Issuer") concurrent with the Issuer's purchase of a portfolio
of the Student Loans; and
WHEREAS,
Issuer desires to join in this Amendment to assure that the terms hereof shall
apply to the rights and obligations it holds as a partial assignee of the
Agreement and Servicer desires that this Amendment shall apply equally to all
loan owners who receive servicing under the Agreements; and
WHEREAS,
Servicer and Owner otherwise wish to retain all terms and provisions in the
Agreement and to continue to exercise their rights and fulfill their duties
thereunder.
NOW
THEREFORE, in consideration of the mutual covenants contained herein and other
valuable consideration, and intending to be legally bound, the parties agree
as
follows:
|
1.
|
The
Fee Schedule is deleted in its entirety and replaced with the
following:
|
FEE
SCHEDULE FOR
ALTERNATIVE
SERVICING AGREEMENT
DATED
OCTOBER 16, 2001
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
I. DEFINITIONS
In
addition to the words and terms elsewhere defined in this Agreement, the
following terms shall have the following meanings unless the Agreement indicates
a contrary meaning or intent:
|
A.
|
An
"Account" is to refer to the promissory notes collectively of an
individual Borrower of a particular Student Loan type in the same
status
and having the same Guarantor.
|
|
B.
|
An
"Interim Account" is to refer to promissory notes collectively of
an
individual Student Loan Borrower (1) constituting an In-School (Enrolled)
Account, or (2) a Grace Account.
|
|
C.
|
A
"Repayment Account" is to refer to the promissory notes of an individual
Student Loan Borrower under the terms of which the repayment period
has
commenced, and includes Accounts in deferment or
forbearance.
|
|
D.
|
A
"In-School (Enrolled) Account" is to refer to the promissory notes
collectively of an individual Student Loan Borrower (1) with respect
to
which the Borrower is enrolled at an eligible institution on at least
a
half-time basis, and (2) under the terms of which the repayment period
for
principal and interest has not yet commenced.
|
|
E.
|
A
"Grace Account" is to refer to the promissory notes collectively
of an
individual Student Loan Borrower (1) with respect to which the Borrower
has ceased to be enrolled in an eligible institution on at least
a
half-time basis, and (2) under the terms of which the repayment period
has
not yet commenced.
|
|
F.
|
"Standard
Conversion" means the conversion of a Borrower's Account from data
provided in hard-copy format or on magnetic tape.
|
|
G.
|
"On-System
Conversion" means the conversion of a Borrower's Account which the
Servicer is currently Servicing for an owner or holder other than
the
current owner or holder.
|
|
H.
|
"Student
Loan" is to refer to Student Loans serviced under the terms of the
Alternative Servicing Agreement between Servicer and FMC dated October
16,
2001 and serviced in accordance with the Program Guidelines as defined
in
such Agreement.
|
II. SERVICING
FEES
1. MONTHLY
SERVICING FEES - INTERIM ACCOUNT STATUS:
The
Servicing fee for Student Loans in Interim Account Status shall be payable
by
the Owner on a pro-rated monthly basis and shall be equal to [**] per annum
based upon the ending principal balance at each month end.
[**]
x
ending principal balance at month end divided by 12)
2. MONTHLY
SERVICING FEES - REPAYMENT ACCOUNT STATUS:
(a) The
Servicing fee for loans in Repayment Account status for the first [**] from
the
beginning of the Repayment Start Date (which shall mean the later of the first
day following the expiration of any applicable grace period or the first day
following the expiration of Enrolled status), shall be payable by the Owner
on a
pro-rated monthly basis and shall be equal to [**] per annum based upon the
ending principal balance at each month end for all loans [**]
([**]x
ending principal balance at month end divided by 12)
(b) The
Servicing fee for loans in Repayment Account status for the first [**] from
the
beginning of the Repayment Start Date shall be payable by the Owner on a
pro-rated monthly basis and shall be equal to [**] per annum based upon the
ending principal balance at each month end for all loans [**]
([**]
x
ending principal balance at month end divided by 12)
|
(c)
|
The
Servicing fee for loans in Repayment Account status beginning on
the [**]
after the beginning of the Repayment Start Date and thereafter throughout
payout shall be payable by the Owner on a pro-rated monthly basis
and
shall be equal to [**] per annum based upon the ending principal
balance
at each month end for all loans
[**]:
|
([**]
x
ending principal balance at month end divided by 12)
|
(d)
|
The
Servicing fee for loans in Repayment Account status beginning on
the [**]
after the beginning of the Repayment Start Date and thereafter throughout
payout shall be payable by the Owner on a pro-rated monthly basis
and
shall be equal to [**] per annum based upon the ending principal
balance
at each month end for all loans
[**]:
|
[**]
x
ending principal balance at month end divided by 12)
3. RETURN
OF
RECORDS/DECONVERSION
The
Owner
shall pay for the return of Student Loan records belonging to the Owner, upon
termination of this Agreement or with respect to any particular Student Loan,
to
the extent provided for under Section 12.4 of the Agreement, at its own cost
and
expense, not to exceed $[**] per Student Loan file.
4. CLAIM
PROCESSING FEE
The
Owner
shall pay the claim processing fee for defaulted Student Loans at the rate
of
$[**] per claim package filed.
Claim
processing shall include, without limitation, presentation to Insurer of all
documentation required under the Program Guidelines, in the form required
thereunder.
5. CURE
SERVICING FEES: The Owner shall pay Cure Servicing fees as follows:
(a) For
Owner
Caused Cures,
(i) Monthly
per Account Servicing fee;
(ii) $[**]
per
Account for skiptracing activities, including letters and phone calls, if
located;
(iii) $[**]
per
Account if referred to a third party under contract with the Servicer for
Cure/collection after successful location; and
(iv) $[**]
per
Account if the guarantee is reinstated or a default claim is paid;
or
(v) $[**]
per
Account if deconverted and returned to the Owner.
(b) For
Servicer Caused Cures, the Owner shall pay monthly, per Account, the Servicing
fees as set forth in this Schedule. Any Servicing deficiency that voids or
limits the guaranty under the Program Guidelines shall constitute a Servicer
Caused Cure.
|
6.
|
SERVICING
FEES FOR REINSTATEMENT OF ACCOUNTS TO SERVICER'S SERVICING
SYSTEM
|
The
Owner
shall pay a fee of [**] dollars ($[**]) per Student Loan Account to reinstate
such Student Loan to Servicer's Servicing system, including, but not limited
to
defaulted Student Loans, and later reconverted to the Servicer's Servicing
system.
7. MISCELLANEOUS
EXPENSES
An
additional amount for miscellaneous expenses will be billed for Services
requested by the Owner, such as document transferal, special computer reports,
mail and shipping costs, etc., not otherwise required to be furnished. Fees
for
computer projects will be billed at the following rates:
|
(a)
Staff Services
|
-
|
$[**]
per hour
|
|
(b)
Computer Programmer
|
-
|
$[**]
per hour
|
|
(c)
Computer Analyst
|
-
|
$[**]
per hour
|
|
(d)
Computer Clock Hour
|
-
|
$[**]
per hour
|
III. EARLY
TERMINATION FEES
In
the
event Owner is required pursuant to the Agreement to pay an Early Termination
Fee, such Fee shall be assessed and paid to Servicer as follows:
|
A.
|
$[**]
per Account during the first year of the
Agreement;
|
|
B.
|
$[**]
that this Agreement has been in effect X $[**]) per Account anytime
after
the first year of the Agreement.
|
II.
This
Third Amendment shall be effective as of May 1, 2003.
III.
Except
as
otherwise amended by this Third Amendment, the Agreement, including without
limitation the Fee Schedule, shall remain in full force and effect.
IV.
This
Third Amendment may be simultaneously executed in several counterparts each
of
which shall constitute but one and the same instrument.
IN
WITNESS WHEREOF, Servicer, the Issuer and FMC have executed this Third Amendment
and it shall be deemed to be executed such on the month, day and year first
above written.
|
THE
FIRST MARBLEHEAD
CORPORATION
|
PENNSYLVANIA
HIGHER
EDUCATION
ASSISTANCE AGENCY
|
|||
|
By:
|
/s/
▇▇▇▇▇▇ ▇▇▇▇▇▇
|
By:
|
/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
|
|
|
Name:
|
▇▇▇▇▇▇
▇▇▇▇▇▇
|
Name:
|
▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
|
|
|
Title:
|
CHAIRMAN
& CEO
|
Title:
|
President
and CEO
|
|
|
Date:
|
30
APRIL 2003
|
Date:
|
||
|
Federal
Tax ID Number:
|
||||
|
THE
NATIONAL COLLEGIATE
MASTER
STUDENT LOAN
TRUST
I
|
||||
|
By:
|
Wachovia
Trust Company, N.A.,
Trustee
|
|||
|
By:
|
/s/
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
|
|||
|
Date:
|
||||
|
Federal
Tax Id No:
|
▇▇-▇▇▇▇▇▇▇
|
|||
|
Approved
as to form and legality
|
Approved
as to form and legality
|
|||
|
/s/
[illegible]
|
/s/
▇▇▇▇▇▇ ▇▇▇ Lard
|
|||
|
Deputy
Attorney General
|
PHEAA
Legal Counsel
|
|||
ALTERNATIVE
SERVICING AGREEEMENT
BETWEEN
PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY
AND
THE
FIRST MARBLEHEAD CORPORATION
THIS
FOURTH AMENDMENT
is made
this 1st of August, 2003, by and between the PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY,
a
public corporation and governmental instrumentality organized under the laws
of
the Commonwealth of Pennsylvania, having an address at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (herein referred to as the “Servicer”),
and THE FIRST
MARBLEHEAD CORPORATION,
having
an address at ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇ (herein called
the “Owner”).
RECITALS
WHEREAS,
the
parties previously entered into a Alternative Servicing Agreement dated October
16, 2001, as amended by the First Amendment dated November 1, 2001 and as
further amended by the Second Amendment dated November 1, 2001 (herein
collectively referred to as the “Agreements”), which sets forth the terms for
the servicing of Student Loans owned by the Owner and serviced by the
Servicer;
WHEREAS,
Servicer and Owner now wish to amend certain provisions contained in the
Agreement and the Servicing Schedules attached thereto;
WHEREAS,
pursuant
to a Servicer Consent Letter dated as of November 1, 2001, the rights of Owner
for servicing of certain Student Loans under this Agreement was assigned to
The
National Collegiate Master Student Loan Trust I, a Delaware business trust
(the
“Issuer”) concurrent with the Issuer’s purchase of a portfolio of the Student
Loans; and
WHEREAS,
Issuer
desires to join in this Amendment to assure that the terms hereof shall apply
to
the rights and obligations it holds as a partial assignee of the Agreements
and
Servicer desires that this amendment shall apply equally to all loan owners
who
receive servicing under the Agreements; and
WHEREAS,
Servicer and Owner otherwise wish to retain all terms and provisions in the
Agreement and to continue to exercise their rights and fulfill their duties
thereunder.
NOW
THEREFORE,
in
consideration of the mutual covenants contained herein and other valuable
consideration, and intending to be legally bound, the parties agree as
follows:
I.
1. Section
4., “Duties of FMC and the Servicer”, is hereby amended by adding a new Section
4.8., “Late Fees”, as follows:
“4.8.
Late Fees. FMC,
Issuer and Servicer agree that a Borrower in repayment status (which refers
to a
Borrower’s Student Loan Serviced under the terms of this Agreement for which,
under the terms of the Borrower’s promissory note(s), the repayment period has
commenced, and includes Accounts in deferment or forbearance) may be assessed
late fees when payments are overdue, to the extent allowed by the terms of
the
promissory note(s) or as established by FMC, and in accordance with the terms
of
this Section (herein referred to as “Late Fees”). FMC agrees to notify Servicer,
in writing, of the Late Fees criteria which FMC desires the Servicer to apply
to
each Student Loan type. Such criteria shall include, but not be limited to,
Late
Fee amounts, time period and applicable state law in which Late Fees will be
assessed to FMC's Accounts. FMC may establish different Late Fee criteria for
Student Loans having different Owner Codes and loan programs. FMC directions
as
to Late Fee criteria shall apply to all loans, including those owned by Issuer.
Late Fee criteria for some product types may include “no late fee.” The Servicer
reserves the right to submit questions pertaining to the requirements regarding
the assessment of Late Fees to FMC’s Student Loan portfolio and FMC agrees to
respond to Servicer’s questions within thirty (30) days. Late Fees shall be
deducted from any payment(s) received from Borrowers as directed by FMC. FMC
agrees that unpaid Late Fees shall not be included if a default claim is
submitted to the Guarantor or to the Insurer and that the Servicer may make
the
determination whether it is appropriate, in accordance with the Servicer’s
established due diligence and collection procedures and consistent with the
regulations, to reverse unpaid Late Fees from a Borrower’s Account without prior
approval from FMC. FMC agrees that the Servicer shall not be liable to FMC
for
such reversed Late Fees, nor shall the Servicer be responsible to FMC for
reimbursement to FMC for any such reversed Late Fees.”
2. Section
6.2., “Invoices”, is deleted in its entirety and replaced with the
following:
“6.2.
Invoices. Invoices
for the Servicer’s Services, including the collection of Late Fees collected on
behalf of FMC as set forth in Section 4.8. herein and Section IV. of the Fee
Schedule attached hereto shall be rendered by the Servicer after each month
end
with payment to be paid by FMC within twenty (20) days of the invoice date.
If
full payment is not received within thirty (30) days of the invoice date, except
as to amounts which are under dispute, the Servicer may assess an interest
charge of [**]% per month ([**]% Annual Percentage Rate) on the unpaid balance
from the date of the initial billing until fully paid. If full payment is not
received within sixty (60) days from the date of the invoice, except as to
amounts which are under dispute, such non-payment shall constitute a default
hereunder and shall entitle the Servicer at any time thereafter, to notify
FMC
of such default and if such default is not cured within thirty (30) days from
the date of such notice, the Servicer at its option, may immediately terminate
this Agreement. Upon assignment of rights under this Agreement to an SPE or
a
Permitted Assignee, Servicer’s right to terminate this Agreement for nonpayment
shall apply to a particular SPE only if servicing fees owed by that SPE shall
have remained unpaid for the period provided above. FMC shall report any
disputes to the Servicer regarding an invoice for Servicing within sixty (60)
days of the invoice date, and the Servicer shall research FMC’s account and
respond to FMC. If FMC does not report any disputes regarding an invoice for
Servicing within sixty (60) days of receipt of the invoice, FMC is deemed to
have accepted the invoice and the amount due and payable therein, and the
Servicer shall not be responsible for researching FMC’s account, regarding such
invoice, thereafter.”
3. The
Fee
Schedule is hereby amended by adding a new Section IV. “Late Fees”, as
follows:
“IV. LATE
FEES
At
such
time as Servicer begins to ▇▇▇▇ Borrowers for Late Fees in accordance with
Section 4.8. of this Agreement, FMC agrees that Servicer shall, in accordance
with Section 6.2. of this Agreement, invoice FMC, as a fee for the collection
of
such Late Fees, an amount equaling [**] percent of the total Late Fees
collected.”
The
remainder of the Fee Schedule continues and remains unchanged.
II.
This
Fourth Amendment shall be effective as of the date hereof.
III.
Except
as
otherwise amended by this Fourth Amendment, the Agreement shall remain in full
force and effect.
IV.
This
Fourth Amendment may be simultaneously executed in several counterparts each
of
which shall constitute but one and the same instrument.
IN
WITNESS WHEREOF,
Servicer and FMC have executed this Fourth Amendment and it shall be deemed
to
be executed such on the month, day and year first above written.
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THE
FIRST MARBLEHEAD
CORPORATION
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PENNSYLVANIA
HIGHER
EDUCATION
ASSISTANCE AGENCY
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By:
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/s/
▇▇▇▇▇▇ ▇. ▇▇▇▇
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By:
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/s/
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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|
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Name:
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▇▇▇▇▇▇
▇. ▇▇▇▇
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Name:
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▇▇▇▇▇▇▇
▇. ▇▇▇▇▇▇
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Title:
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EVP
and Chief Financial Officer
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Title:
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President
and CEO
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Date:
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22
July 2003
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Date:
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8/19/03
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Federal
Tax ID Number: ▇▇-▇▇▇▇▇▇▇
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||||
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Approved
as to form and legality
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Approved
as to form and legality
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|||
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/s/
[illegible]
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/s/
▇▇▇▇▇▇ ▇▇▇ Lard
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Deputy
Attorney General
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PHEAA
Legal Counsel
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FIRST
MARBLEHEAD DATA SERVICES,
As
Administrator for the Issuer
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By:
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/s/
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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Name:
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▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇
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Title:
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Treasurer
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Date:
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7/22/03
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Federal
Tax ID NO:
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▇▇▇▇▇▇▇▇▇
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