Common use of LIABILITY OF THE SUBSERVICER Clause in Contracts

LIABILITY OF THE SUBSERVICER. The Subservicer assumes no responsibility or liability for failure of the Trust or NSLF to exercise reasonable care or due diligence and the results thereof, in making or servicing an Education Loan prior to placing of the Education Loan on Subservicer's system and prior to the date the Trust or NSLF holds ownership of the Education Loan. The Subservicer also assumes no liability for the failure of any student/parent borrower to repay his or her loan, nor the failure of the United States government to pay any principal, interest, subsidy or special allowance, nor for the failure of any Guarantor to make payment of any principal and/or interest on any of the Trust's or NSLF's Education Loans. The Subservicer shall not be responsible for consequences of unreasonable acts of any Guarantor. In the event the Subservicer shall take any action or fail to take any action which causes any Education Loan in the Trust's or NSLF's portfolio to be denied the benefit of any applicable guarantee, the Subservicer shall have a reasonable time to cause the benefits of the guarantee to be reinstated. If the guarantee is not reinstated within twelve (12) months of denial by Guarantor, the Subservicer shall pay the Trust or NSLF, as applicable, an amount equal to the outstanding principal balance plus all accrued interest and other fees due on the Education Loan to the date of purchase, less the amount subject to the risk sharing under the Education Act and Regulations, and thereupon the Subservicer shall be subrogated to all rights of the Trust and NSLF respecting the applicable Education Loan, including without limitation the right to collect on the Education Loan, the right to federal subsidies, and agency authorization to litigate in accordance with the Subrogation Agreement with the Subservicer. In such event, the Master Servicer agrees to perform such further applicable acts as shall be necessary or appropriate to subrogate the Education Loan to the Subservicer. For any subrogated Education Loan for which the guarantee is fully reinstated by a Guarantor, the Master Servicer shall pay the Subservicer an amount equal to the then outstanding principal balance plus all accrued interest due thereon, less the amount subject to the risk sharing under the Education Act and Regulations, whereupon the subrogation rights of the Subservicer shall terminate. In such event, the Subservicer shall perform such further acts as shall be necessary or appropriate to reconvey the Education Loan to the Trust or NSLF. It is hereby acknowledged that the Master Servicer shall not be performing any of the servicing activities described in this Agreement, and that the Subservicer shall be responsible for performance of all such servicing duties. As such, the Master Servicer shall have no liability of any nature whatsoever arising out of or in connection with this Agreement for any negligent or wrongful act or omission on the part of the Subservicer; provided, however, that the Master Servicer may assign, transfer and set over unto the Trust or NSLF, as applicable, all of the Master Servicer's rights and remedies against the Subservicer as they pertain to the Trust's or NSLF's Education Loans.

LIABILITY OF THE SUBSERVICER. The Subservicer assumes no responsibility or liability for failure of the Trust or NSLF to exercise reasonable care or due diligence and the results thereof, in making or servicing an Education Loan prior to placing of the Education Loan on Subservicer's ’s system and prior to the date the Trust or NSLF holds ownership of the Education Loan. The Subservicer also assumes no liability for the failure of any student/parent borrower to repay his or her loan, nor the failure of the United States government to pay any principal, interest, subsidy or special allowance, nor for the failure of any Guarantor to make payment of any principal and/or interest on any of the Trust's ’s or NSLF's ’s Education Loans. The Subservicer shall not be responsible for consequences of unreasonable acts of any Guarantor. In the event the Subservicer shall take any action or fail to take any action which causes any Education Loan in the Trust's ’s or NSLF's ’s portfolio to be denied the benefit of any applicable guarantee, the Subservicer shall have a reasonable time to cause the benefits of the guarantee to be reinstated. If the guarantee is not reinstated within twelve (12) months of denial by Guarantor, the Subservicer shall pay the Trust or NSLF, as applicable, an amount equal to the outstanding principal balance plus all accrued interest and other fees due on the Education Loan to the date of purchase, less the amount subject to the risk sharing under the Education Act and Regulations, and thereupon the Subservicer shall be subrogated to all rights of the Trust and NSLF respecting the applicable Education Loan, including without limitation the right to collect on the Education Loan, the right to federal subsidies, and agency authorization to litigate in accordance with the Subrogation Agreement with the Subservicer. In such event, the Master Servicer agrees to perform such further applicable acts as shall be necessary or appropriate to subrogate the Education Loan to the Subservicer. For any subrogated Education Loan for which the guarantee is fully reinstated by a Guarantor, the Master Servicer shall pay the Subservicer an amount equal to the then outstanding principal balance plus all accrued interest due thereon, less the amount subject to the risk sharing under the Education Act and Regulations, whereupon the subrogation rights of the Subservicer shall terminate. In such event, the Subservicer shall perform such further acts as shall be necessary or appropriate to reconvey the Education Loan to the Trust or NSLF. It is hereby acknowledged that the Master Servicer shall not be performing any of the servicing activities described in this Agreement, and that the Subservicer shall be responsible for performance of all such servicing duties. As such, the Master Servicer shall have no liability of any nature whatsoever arising out of or in connection with this Agreement for any negligent or wrongful act or omission on the part of the Subservicer; provided, however, that the Master Servicer may assign, transfer and set over unto the Trust or NSLF, as applicable, all of the Master Servicer's ’s rights and remedies against the Subservicer as they pertain to the Trust's ’s or NSLF's ’s Education Loans.