MASTER SERVICING AGREEMENT
This MASTER SERVICING AGREEMENT (the “Master Servicing
Agreement”) is entered into as of April 1, 2004 by and between Collegiate
Funding Master Servicing, L.L.C., having its principal office in Fredericksburg,
Virginia (the “Servicer”) and Collegiate Funding Services Education
Loan Trust 2004-A, a Delaware statutory trust, having its principal office in
Wilmington, Delaware (the “Issuer”).
WITNESSETH:
WHEREAS, the Issuer acquires and holds student loans which are guaranteed under
a guarantee program established pursuant to the requirements of the Higher
Education Act of 1965, as amended (the “Student Loans”); and
WHEREAS, pursuant to this Master Servicing Agreement the Servicer will agree to
provide, or cause there to be provided, loan servicing services for certain
Student Loans; and
WHEREAS, the Issuer wishes to retain the Servicer to service certain Student
Loans owned by the Issuer as beneficial owner and by an eligible lender as
eligible lender trustee (such Student Loans subject to this Master Servicing
Agreement being referred to herein as the “Financed Student Loans”),
and the Servicer wishes to undertake the obligation to service or cause to be
serviced all such Financed Student Loans in accordance with the requirements of
the Higher Education Act of 1965, as amended, regulations promulgated thereunder
by the U.S. Department of Education and regulations and other requirements
issued by any applicable guaranty agency or insurer (collectively, the
“Higher Education Act”) and under the terms hereinafter set forth; and
WHEREAS, the Servicer may subcontract with other third parties, to the extent
permitted by the hereinafter defined Indenture, to provide the services required
of Servicer hereunder;
NOW
THEREFORE, in consideration of the premises and mutual covenants contained
herein, the Issuer and the Servicer agree as follows:
1. Servicing Requirement and
Employment of Servicer
The Issuer hereby authorizes and appoints the Servicer to act as
its agent for the limited purpose of performing servicing for the Financed
Student Loans. The Servicer agrees to perform such functions in compliance with
all requirements of the Higher Education Act and all other applicable laws and
regulations, and in accordance with the terms and conditions of this Master
Servicing Agreement.
The authorization granted by this Master Servicing Agreement
includes, but is not limited to, correspondence and communication with any
guaranty agency or the U.S. Department of Education regarding the Financed
Student Loans, the assignment of claims to any guaranty agency or insurer,
communication with borrowers and any other communication, correspondence,
signature or other act required to service the Financed Student Loans in
accordance with requirements of the Higher Education Act or regulations
promulgated by any guaranty agency.
The Issuer hereby authorizes the Servicer to enter into
sub-servicing contracts to provide the services required of the Servicer
hereunder and to meet any obligations of the Issuer hereunder, including the
sub-servicing agreement, dated as of April 1, 2004, between the Servicer and
CFS-SunTech Servicing LLC, as sub-servicer (the “Sub-Servicer”)
permitted by the Indenture of Trust dated as of April 1, 2004 (the
“Indenture”) between the Issuer and U.S. Bank National Association, as
eligible lender trustee and indenture trustee (together with its successors and
assigns, the “Trustee”).
2. Term
The term of this Master Servicing Agreement shall commence as of
the date of this Master Servicing Agreement and shall continue for an initial
period of three (3) years. At the expiration of the initial term (including any
extensions thereof), the term shall automatically extend for one additional year
each year thereafter, unless either party gives 90 days written notice prior to
the end of the initial term or any extension of the term. The Servicer may,
concurrent with the beginning of any extension of the term, increase the fees,
charges and expenses from those set forth in Exhibit A hereto by giving at least
one hundred twenty (120) days notice prior to the beginning of such extension of
the term. In no case will any individual fee charge or expense increase more
than 2% above the immediately preceding fee developed in accordance with this
Section or Section 3(e) below.
The representations and warranties of the Servicer in Section 7,
and the indemnities in Section 14 shall survive any termination of this Master
Servicing Agreement. If servicing of any Financed Student Loan is transferred to
a successor servicer, such successor servicer shall be required by the Issuer to
engage in good faith efforts to obtain payment on any claim initially rejected
by a guaranty agency or insurer for payment including, without limitation,
involving the Servicer in such effort, where the reason for claim denial relates
to the period during which the Servicer serviced such Financed Student Loan
hereunder.
3. Fees and Payment of
Fees
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a. |
Initially fees shall be charged in accordance with the schedule
set forth in Exhibit A. |
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b. |
Servicer shall submit an invoice monthly to the Issuer, and the
Issuer shall remit payment for services performed as shown on that invoice. |
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c. |
Payment is due within 30 days after receipt of the Billing
Package. The Billing Package shall consist of an invoice, and supporting
documentation. The Servicer shall be paid interest at a rate of prime + 2% per
annum for fees not paid within sixty (60) days of the most recent Billing
Package. This charge shall apply to each thirty (30) day period until the fee is
paid. Prime rate will be the rate reported in the Wall Street Journal as of the
last business day of the month in which the Billing Package was received. |
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d. |
The Servicer acknowledges that the Issuer shall be entitled to
receive all payments of principal, interest, Special Allowance Payments and late
charges received with respect to the Financed Student Loans and that the
Servicer shall have no right to retain such amounts as payment of any fees due
to the Servicer from the Issuer under the terms of this Master Servicing
Agreement. The Issuer hereby authorizes the Servicer to assess, collect and
retain any charges which the Issuer is permitted by law or regulation to assess
with respect to not sufficient fund ("NSF") processing or other collection
costs. |
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e. |
If other costs beyond the control of the Servicer shall increase,
including, without limitation, postal rates, or the imposition of any tax or
assessment not currently being charged against the fees of the Servicer, then
the Servicer shall provide the Issuer with 90 days' prior written notice (and
including supporting documentation) of such proposed increased costs and
expenses. If the Issuer accepts such increased costs and expenses, the increased
costs and expenses will go into effect at the end of such 90 day period. If the
Issuer objects to such fee increase and the Servicer fails to agree to reduce or
eliminate the increase in a manner satisfactory to the Issuer, then an early
termination will occur and the Financed Student Loans will be deconverted at
cost within 180 days of receipt of said notice. The Issuer shall not be
permitted to so terminate this Master Servicing Agreement unless and until the
Issuer shall have entered into another agreement similar to this with the
Servicer or another Servicer satisfying the Rating Agency Confirmation. |
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f. |
If the Servicer's costs and expenses are increased due to changes
in the manner of servicing the Financed Student Loans as a result of changes in
the Higher Education Act or the interpretation thereof or due to changes in
guaranty agency requirements, then 90 days after delivery of written notice to
the Issuer the Servicer may increase servicing fees payable hereunder to
reasonably reflect such costs and expenses. However, no such increase shall take
effect until the Servicer provides supporting documentation to the Issuer that
justifies such increase. In the event the parties do not agree on the
interpretation of the changes to the Higher Education Act, then either party may
terminate this Master Servicing Agreement upon ninety (90) days' written notice
to the other party; provided, however, that this Master Servicing Agreement
shall not be so terminated by the Issuer unless and until the Issuer shall have
entered into another agreement similar to this with the Servicer or another
servicer satisfying the Rating Agency Confirmation.
If the Issuer believes the cost for services under this Master Servicing
Agreement are lower by changes in regulations, law or processing, the Issuer
will submit a proposed fee schedule to the Servicer. If the Servicer does not
reject the schedule, the fees will go into effect 90 days thereafter. |
4. Loan Servicing
The Servicer covenants and agrees to service each Financed
Student Loan in compliance with all requirements of the Higher Education Act and
all other applicable laws and regulations. Without limiting the foregoing, in
fulfillment of its obligations hereunder, the Servicer shall:
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a. |
Maintain a complete and separate file for the Financed Student
Loans of each borrower, which file shall include all documentation and
correspondence related to the Financed Student Loans. |
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b. |
Perform the actions necessary to maintain the guarantee and/or
insurance on each Financed Student Loan at all times. |
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c. |
Exercise "due diligence" as that term is defined in the Higher
Education Act, in the servicing, administration and collection of all Financed
Student Loans. See also Section 5. |
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d. |
Prepare and maintain accounting records with respect to the
Financed Student Loans; process refunds and other adjustments; process address
changes and maintain address records. |
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e. |
Collect, or cause to be collected, all payments of principal,
interest, Special Allowance Payments and late charges (and including any
guarantee payments) and deposit all such payments into the Collection Account
established with the Trustee under the Indenture or, in the case of Interest
Benefit Payments or Special Allowance Payments, cause such payments to be
forwarded to the Trustee. The Servicer shall remit collected funds by automated
clearing house (ACH) to the Trustee as the Servicer and Issuer shall mutually
agree. Upon submission by the Servicer to the Secretary of Education of a
billing for Interest Benefit Payments or Special Allowance Payments, the
Servicer shall, upon request, provide to the Trustee a written statement
indicating (a) the amount billed for Interest Benefit Payments and (b) the
principal amount in each Special Allowance Payment category for which the
billing is submitted, for use by the Trustee in verifying amounts billed for and
received with respect thereto from the Secretary of Education. In the event of
discrepancies or disputes with the Secretary of Education, the Servicer shall be
responsible for representing the interests of the Issuer and the Trustee in
effecting a settlement with the Secretary of Education of such discrepancies or
disputes. |
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f. |
Retain summary records of contacts, follow-ups and collection
efforts, and records of written correspondence relating to the Financed Student
Loans of each borrower sufficient to ensure claim payment. |
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g. |
Process adjustments including NSF checks, status changes,
forbearances, deferments and Financed Student Loans paid in full. |
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h. |
Prepare and transmit to the Issuer or its designee reports,
including but not limited to ED Form 799, required by the U. S. Department of
Education or any guaranty agency or the Higher Education Act. |
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i. |
In the case of defaulted Financed Student Loans, promptly take the
actions necessary to file and prove a claim for loss with the guaranty agency as
required, and assume responsibility for communication and contact with the
guaranty agency to accomplish recovery on such defaulted Financed Student
Loans. |
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j. |
At all times identify the Issuer and the Trustee, as the Issuer's
eligible lender trustee as the owners of the Financed Student Loan and identify
the Trustee, as indenture trustee, as a party which maintains a security
interest in the Financed Student Loan. |
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k. |
Maintain a duplicate or copy of the file (which may be in the form
of computer tape, microfilm or other electronic image) for each borrower at an
off-site location. |
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l. |
Maintain the original file in fireproof cabinets or in other
fireproof storage sufficient to protect the contents from a temperature of 1600
degrees Fahrenheit for one hour. |
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m. |
Prepare and furnish to the Issuer by the 10th working day of each
month, the reports described in Exhibit B related to the Financed Student
Loans. |
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n. |
(i) |
Obtain and maintain or cause to be obtained and maintained in
force a fidelity bond in an amount of at least $1,000,000 upon all personnel of
the Servicer insuring against any loss or damage which the Issuer or the
Servicer might suffer as a consequence of any fraudulent or dishonest act of
such personnel. |
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(ii) |
Obtain and maintain or cause to be obtained and maintained in
force Errors and Omissions insurance coverage in an amount equal to at least
$2,000,000 for all its customers. |
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o. |
Immediately respond to any communication received which is in the
nature of a complaint. Promptly answer all inquiries from borrowers or the
Issuer pertaining to the Financed Student Loans, disbursements, refunds or
school status. Such inquiries may, if necessary, be referred to the educational
institution the student attended or is attending. The Servicer shall have no
responsibility with respect to any dispute between the student and the
educational institution regarding tuition, fees or refunds. |
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p. |
Establish and maintain a method for charging and collecting late
payment fees in accordance with provisions of the Higher Education Act and all
other applicable laws and regulations. |
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q. |
The Servicer shall act as custodian and bailee with respect to all
original documents and shall hold them subject to the lien of the Indenture in
favor of the Trustee and pursuant to the Custodian Agreements substantially in
the form of Exhibit C hereto. The Servicer agrees to enter into any reasonable
custodian, bailment or similar agreement reasonably required by the Issuer with
respect to perfecting and protecting the security interests of any secured
party. |
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r. |
If any Financed Student Loan has lost its guarantee and/or
insurance due to the actions of any prior issuer or the servicer or holder of
the Financed Student Loan, the Servicer will, at the written request of the
Issuer, use its best efforts to reinstate such guarantee or insurance; provided,
however, that the Servicer makes no representation that such reinstatement will
occur. Such services shall be provided at the cost agreed upon by the Issuer and
the Servicer as defined in Exhibit A under cure services; provided that such
services shall be provided by the Servicer at no cost to the extent the
Sub-Servicers or another servicer or sub-servicer is required to provide such
services to the Servicer at no cost. |
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s. |
The Servicer shall remit monthly rebate fees to the United States
Department of Education with respect to the Financed Student Loans to the extent
amounts are made available to the Servicer in accordance with the following
sentence. Upon receipt of satisfactory documentation, the Issuer shall promptly
wire transfer to the Servicer, from amounts held under the Indenture, the amount
of funds required to pay such fees. The Servicer shall provide the Issuer, on a
monthly basis, with information needed to determine the monthly rebate
fees. |
5. Due Diligence
The Servicer covenants and agrees that in discharging its
obligations hereunder it shall:
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a. |
Exercise due diligence in the servicing and collection of all
Financed Student Loans as the term "due diligence" is used in the Higher
Education Act, including the regulations of the applicable guaranty agency or
insurer. |
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b. |
Exercise reasonable care and diligence in the administration and
collection of all Financed Student Loans utilizing collection practices in
accordance with applicable Federal and State collection practices, laws and
regulations promulgated thereunder. |
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c. |
Administer and collect the Financed Student Loans in a competent,
diligent and orderly fashion, and in accordance with the requirements of the
Higher Education Act. |
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d. |
Exercise reasonable care and diligence in those aspects of the
administration of the Financed Student Loan program which are within its area of
responsibility. |
6. Right of Inspection;
Audits
The Issuer, the Trustee or any governmental agency having
jurisdiction over any of the same shall have the right from time to time during
normal business hours to examine and audit any of the Servicer’s records
pertaining to any Financed Student Loan being serviced, provided, however, that
such activities shall not unreasonably disrupt the Servicer’s normal
business operation.
The Servicer agrees that it
shall permit, not more than once per year, the Issuer, the Trustee or its
designee to conduct or have conducted a procedural audit regarding the
Servicer’s compliance with the requirements of the Higher Education Act or
the terms of this Master Servicing Agreement. Such audits shall be at the
expense of the Issuer.
7. Representations, Warranties,
and Covenants of Servicer
The Servicer represents and warrants to the Issuer on the date
of this Master Servicing Agreement and (except with respect to (d) and (e)
below) throughout the term of this Master Servicing Agreement:
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a. |
The Servicer (i) is duly organized, validly existing, and in good
standing under the laws of the jurisdiction in which it is formed; (ii) is duly
qualified to transact business and is in good standing as a foreign limited
liability company in each jurisdiction where the nature and extent of its
business and properties require due qualification and good standing; (iii)
possesses all requisite authority, permits and power to conduct its business as
is now being or as contemplated by this Master Servicing Agreement to be
conducted; and (iv) is in compliance with all applicable laws and
regulations. |
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b. |
The execution and delivery by the Servicer of this Master
Servicing Agreement and the performance by it of its obligations hereunder (i)
are within its organizational power, (ii) have been duly authorized by all
necessary action, (iii) except for any action or filing that has been taken or
made on or before the date of this Master Servicing Agreement, require no action
by or filing with any governmental agency, and (iv) do not violate any provision
of its limited liability company agreement. |
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c. |
This Master Servicing Agreement will, upon execution and delivery
by all parties thereto, constitute a legal and binding obligation of the
Servicer, enforceable against the Servicer according to its terms. |
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d. |
All Servicer financial statements delivered to the Issuer were
prepared according to U.S. generally accepted accounting principles ("GAAP")
consistently applied and present fairly, in all material respects, the financial
condition, results of operations and cash flows of the Servicer as of, and for
the portion of the fiscal year ending on their date or dates (subject, in the
case of financial statements other than annual ones, only to normal year-end
adjustments). No event which could cause a material adverse effect on the
Servicer's financial condition has occurred, and if such event shall occur, the
Servicer shall promptly give the Issuer notice thereof. |
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e. |
The Servicer is not subject to, or aware of the threat of, any
litigation that is reasonably likely to be determined adversely to it and that,
if so adversely determined, would have a material adverse effect on its
financial condition and no outstanding or unpaid judgments against the Servicer
exist, and if such event shall occur, the Servicer shall promptly give the
Issuer notice thereof. |
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f. |
The Servicer's examination process did not disclose or create any
basis upon which to believe that each Financed Student Loan for which a
certificate has been delivered under the Custodian Agreements except as
indicated in such certificate, (i) is not in compliance in all material respects
with all laws and rules and regulations with respect to the guaranty thereof,
and (ii) does not conform to the applicable requirements of eligibility for
guaranty. |
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g. |
The Servicer further agrees to maintain its servicing system so
that it will continue to provide all services required under this Master
Servicing Agreement. |
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h. |
Until all Financed Student Loans serviced hereunder have been
repaid in full, or paid as a claim by a guaranty agency or insurer, or
transferred to another servicer, the Servicer agrees as follows: |
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(i) |
The Servicer shall cause to be furnished to the Issuer such
financial statements as the Issuer may reasonably request, including quarterly
unaudited financial statements within 30 days after the conclusion of each
quarter, and annually audited financial statements and such other information
with respect to its business affairs, assets, and liabilities as the Issuer may
reasonably request. |
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(ii) |
The Servicer shall maintain books, records and accounts necessary
to prepare financial statements according to GAAP. |
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(iii) |
The Servicer shall maintain all licenses, permits, and franchises
necessary for its business. |
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i. |
If and to the extent required by the Higher Education Act,
including any guarantee program regulations, the Servicer shall cause to have
prepared and shall submit to the Secretary of Education and the guaranty
agencies on or before the respective due dates thereof: |
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(i) |
any third-party servicer compliance audits and audited financial
statements required under the Higher Education Act, including any guarantee
program, regulations relating to the Servicer and its servicing of the Financed
Student Loans; and |
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(ii) |
any lender compliance audits required under the Higher Education
Act, including any guarantee program regulations, relating to the Trustee (as
the holder of the Financed Student Loans) and the Financed Student Loans. |
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The Servicer shall provide to the Trustee promptly after it
becomes available (and in no event later than 10 Business Days) a copy of each
such audit and any other audit or report required by the Secretary of Education,
any guaranty agency or other third party in connection with the Servicer’s
activities in servicing the Financed Student Loans. |
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j. |
The Servicer shall provide to the Trustee copies of its annual
third party (SAS70) audit reports, if such reports are prepared, promptly
following the Servicer's receipt thereof. |
8. Representations and Warranties of Issuer
The Issuer represents and warrants to the Servicer on the date
of this Master Servicing Agreement:
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a. |
The Issuer (i) is duly formed, validly existing, and in good
standing under the laws of the jurisdiction in which it is formed; (ii) is duly
qualified to transact business as a Delaware statutory trust; and (iii) possess
all requisite authority, permits and power to conduct its business as is now
being, or is contemplated by this Master Servicing Agreement to be,
conducted. |
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b. |
The execution and delivery by the Issuer of this Master Servicing
Agreement and the performance by it of its obligations hereunder (i) are within
its organizational power; (ii) have been duly authorized by all necessary
action; (iii) except for any action or filing that has been taken or made on or
before the date of this Master Servicing Agreement, require no action by or
filing with any governmental agency; and (iv) do not violate any provision of
its trust agreement. |
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c. |
This Master Servicing Agreement will, upon execution and delivery
by all parties thereto, constitute a legal and binding obligation of the Issuer,
enforceable against the Issuer according to its terms. |
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d. |
The Issuer is not subject to, or aware of the threat of, any
litigation that is reasonably likely to be determined adversely to it and that,
if so adversely determined, would have a material adverse effect on its
financial condition relevant to this Master Servicing Agreement. |
9. Amendments; Benefits;
Assignment; Termination
This Master Servicing Agreement may be amended, supplemented or
modified only by written instrument duly executed by the Issuer and the Servicer
with the consent of the Trustee, provided, however, that the Rating Agency
Confirmation is satisfied.
Either party may terminate this Master Servicing Agreement if
the other party commits a material breach of this Master Servicing Agreement and
the breach is not corrected within ninety (90) days after receipt of written
notification that such breach has occurred; provided, however, that the Issuer
shall not terminate this Master Servicing Agreement unless and until a
replacement agreement or replacement servicer shall have been engaged by the
Issuer to perform the services required of the Servicer hereunder and the Rating
Agency Confirmation is satisfied. Such notification shall be by certified mail,
Return Receipt Requested.
In the event of termination of this Master Servicing Agreement,
the Issuer shall remain liable for all fees due hereunder. Termination shall be
made without prejudice to any other rights or remedies either party may have at
law or in equity. The obligations of the Servicer under Section 6, the
representations and warranties in Section 7 and the indemnities in Section 14
shall survive any termination of this Master Servicing Agreement and shall
remain in effect for all Financed Student Loans while such Financed Student
Loans are serviced by the Servicer. In the event that servicing on any Financed
Student Loan is transferred to a successor servicer, such successor servicer
shall be required by the Issuer to engage in reasonable good faith efforts to
obtain payment on any claim initially rejected by a guaranty agency or insurer
for payment including, without limitation, involving the Servicer in such
effort, where the reason for claim denial relates to the period during which the
Servicer serviced such Financed Student Loan hereunder. However, if the cause
for claim denial is reasonably attributable to the Servicer actions or
inactions, the Servicer shall be responsible therefor. This Master Servicing
Agreement shall not be assigned by either party without the prior written
consent of the other party, and such consent shall not be unreasonably withheld.
10. Disposition of Files on
Termination
Upon termination of this Master Servicing Agreement, all files
(physical and electronic) held by the Servicer with respect to Financed Student
Loans shall be promptly transferred to the Issuer or its designee in such form
as the Issuer reasonably requests. The Issuer shall be responsible for payment
of reasonable expenses related to the transfer of the records unless the Issuer
is removing the Financed Student Loans because of a breach by the Servicer. In
such instance, the Servicer shall bear the cost of deconverting and the transfer
of loan documentation. Exhibit A addresses expenses and fees and to the extent
there is conflict between this section and the Exhibit, the Exhibit shall be the
prevailing document.
11. Independent
Contractor
The Servicer is an independent contractor and is not, and shall
not hold itself out to be, the agent of the Issuer except for the limited
specific purposes set forth in this Master Servicing Agreement.
12. Correspondence;
Disclosure
The parties hereto acknowledge and agree that the Servicer will
handle all communication with borrowers necessary to provide its services
hereunder. Data regarding Financed Student Loans shall be disclosed only to the
Issuer, the Trustee or the respective borrower, unless otherwise required by law
or certain financing covenants.
13. Cooperation
Each party covenants and agrees to cooperate fully with the
other to facilitate the transactions contemplated by this Master Servicing
Agreement.
14. Indemnification and
Liability
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a. |
If the Servicer is required to appear in, or is made a defendant
in any legal action or proceeding commenced by any party other than the Issuer
with respect to any matter arising hereunder, the Issuer shall indemnify and
hold the Servicer harmless from all loss, liability, or expense (including
reasonable attorney's fees, but excluding all incidental, special, and
consequential damages) except for any loss, liability or expense arising out of
or relating to the Servicer's willful misconduct or negligence with regard to
the performance of services hereunder or breach of its obligations hereunder or
under the Custodian Agreements. Subject to the limitations set forth in
paragraph 14(b) hereof, the Servicer shall indemnify and hold the Issuer
harmless from all loss, liability and expense (including reasonable attorney's
fees) arising out of or relating to the Servicer's willful misconduct or
negligence with regard to performance of services hereunder or breach of its
obligations hereunder or under the Custodian Agreements, provided that in no
event shall the Servicer be responsible or liable for any incidental, special or
consequential damages with respect to any matter whatsoever arising out of this
Master Servicing Agreement. |
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b. |
If a Financed Student Loan is denied the guarantee by the guaranty
agency or the loss of federal interest, special allowance, and/or insurance
benefits, the Servicer shall have the right to take any action not prohibited by
law or regulation to reduce its losses, if any, hereunder, including but not
limited to curing, at its own expense, any due diligence or other servicing
violation. If any lost guarantee is not reinstated within nine months of the
date the Servicer learns of the loss of the guarantee on a Financed Student
Loan, the Servicer shall take actions which make the Issuer whole with respect
to the Financed Student Loan while maintaining the eligibility for future
reinstatement of the guarantee; provided, however, the Servicer may delay taking
such actions by giving written notice to the Issuer not less often than each 90
days that the Servicer has reason to believe that the guarantee will be
reinstated within time frames permitted by regulations. If the Servicer gives
notice of such delay, the Servicer agrees to pay any accrued interest on the
account that may be uninsured. The Issuer agrees to use its best efforts to
cause the repurchase, at par plus insured interest and benefits thereon, of any
Financed Student Loan which is cured and is reinsured subsequent to its sale by
the Issuer pursuant to actions taken by the Servicer to make the Issuer whole
and if the sale was to an eligible lender to the extent the Issuer has, or can
make available, funds therefor. |
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c. |
The Servicer shall have no responsibility for any error or
omission (including due diligence violations) which occurred prior to the date
the Servicer assumed responsibility for servicing the Financed Student Loan, nor
shall the Servicer be responsible for losses, damages or expenses arising from
any change in law or regulation which retroactively imposes additional
requirements for documentation or servicing actions, provided that the Servicer
has made best efforts to comply with retroactive additional requirements. |
15. Confidentiality
The contents of this Master Servicing Agreement, together with
all supporting documents, exhibits, schedules, and any amendments thereto which
form the basis of the business relationship between the Issuer and the Servicer,
insofar as the same relate to the fees charged by the Servicer which are listed
in Exhibit A hereto, shall be held in strict confidence by both parties and
shall not be disclosed or otherwise discussed with any third party (unless
required by law or regulation) except outside counsel or independent accounts
without the prior written consent of the other party.
16. Sale or Transfer of Loans;
Limitations
The Issuer agrees that if any Financed Student Loans are sold
under conditions that result in the Financed Student Loans being transferred to
another servicer, whether immediately or at some future date, the Issuer will
pay or cause to be paid, at the time such Financed Student Loans are
transferred, the deconversion fees set forth in Exhibit A hereto.
17. Reporting
The Servicer shall prepare on behalf of the Issuer any monthly
Current Reports on Form 8-K (each, a “Monthly Form 8-K”) and Annual
Reports on Form 10-K customary for student loan asset backed securities as
required by the Securities Exchange Act of 1934, as amended (the “Exchange
Act”), and the rules and regulations of the Securities and Exchange
Commission thereunder, and the Servicer shall sign and file (via the Securities
and Exchange Commission’s Electronic Data Gathering and Retrieval System)
such forms on behalf of the Issuer.
Each Monthly Form 8-K shall be filed by the Servicer within 15
days after the end of each month (or if such 15th day is not a business day, the
next business day), and shall include a copy of the report prepared for the
related month pursuant to Section 4.15(c) of the Indenture. Prior to March
30th of each year in which the Issuer is required to file reports
under the Exchange Act (or such other date as may be required by the Exchange
Act and the rules and regulations of the Securities and Exchange Commission),
the Servicer shall file a Form 10-K on behalf of the Trust, in substance as
required by applicable law or applicable Securities and Exchange Commission
staff’s interpretations. The Form 10-K shall also include a certification
from an authorized officer as to the following matters:
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a. |
Based on my knowledge, the information in these reports, taken as
a whole, does not contain any untrue statement of a material fact or omit to
state a material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by that annual report; |
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b. |
Based on my knowledge, the distribution or servicing information
required to be provided by the Servicer under this Servicing Agreement for
inclusion in these reports has been included in these reports; |
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c. |
I am responsible for reviewing the activities performed by the
Servicer under the Servicing Agreement and based upon my knowledge and the
annual compliance review required by this Servicing Agreement, and except as
disclosed in the reports, the Servicer has fulfilled its obligations under the
Servicing Agreement; and |
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d. |
The reports disclose all significant deficiencies relating to the
Servicer's compliance with the minimum servicing standards based upon the report
provided by an independent public accountant after conducting a review of the
Sub-Servicers in compliance with the Compliance Audits (Attestation Engagements)
for Lenders and Lender Servicers Participating in the Federal Family Education
Loan Program. |
In giving the certifications referenced above, the authorized
officer may state that he has reasonably relied on information provided to such
officer by a Sub-Servicer.
18. Miscellaneous
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a. |
Any material written communication received at any time by the
Issuer with respect to a Financed Student Loan or a borrower shall be promptly
transmitted by the Issuer to the Servicer. Such communications include but are
not limited to letters, notices of death or disability, adjudication of
bankruptcy and like documents, and forms requesting deferment of repayment or
loan cancellations. |
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b. |
The Master Servicing Agreement shall be governed by the laws of
the State of Virginia. |
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c. |
All covenants and Master Servicing Agreements herein contained and
the benefits, rights and obligations of the parties hereunder, shall be binding
upon and inure to the benefit of the legal representatives, successors and
assigns of the parties hereto, including but not limited to, any successor
entity acquiring or succeeding to the assets of either party. |
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d. |
The Master Servicing Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which shall
be deemed to constitute but one and the same instrument. |
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e. |
If any provisions of the Master Servicing Agreement shall be held,
or deemed to be, or shall in fact be inoperative or unenforceable as applied in
any particular situation, such circumstance shall not have the effect of
rendering any other provision or provisions herein contained invalid,
inoperative or unenforceable to any extent whatsoever. The invalidity of any one
or more phrases, sentences, clauses or paragraphs herein contained shall have no
effect on the remaining portions of the Master Servicing Agreement or any part
hereof. |
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f. |
All notices, requests, demands or other instruments which may or
are required to be given by either party to the other, shall be in writing and
each shall be deemed to have been properly given when served personally on an
officer of the party to whom such notice is to be given, or upon expiration of a
period of 48 hours (excluding weekends and holidays) from and after the postmark
thereof when mailed postage prepaid by registered or certified mail, requesting
return receipt, addressed as follows: |
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|
If intended for the Issuer: |
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|
If intended for the Servicer: |
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|
|
Collegiate Funding Master Servicing, L.L.C.
000 Xxxxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxxxxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxxxx |
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|
If intended to the Trustee: |
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|
|
U.S. Bank National Association
000 Xxxxxx Xxxxxx, XX-XX-00XX
Xxxxxxxxxx, XX 00000
Attention: Corporate Trust Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000 |
|
|
Either party may change the address to which subsequent notices
are to be sent to it by written notice to the other given as aforesaid, but any
such notice of change, if sent by mail, shall not be effective until the 5th day
after it is mailed. |
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g. |
The Master Servicing Agreement may not be terminated by any party
hereto except in the manner and with the effect herein provided. |
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h. |
When the context of this Master Servicing Agreement so requires or
implies, references to the Issuer include any applicable trustee. |
| |
i. |
If either party cannot fulfill its obligations (other than the
payment of money), in part or in whole, due to a force or event outside its
control, such obligations of that party shall be suspended and such party shall
not be liable to the other party for any failure to perform hereunder as a
result. |
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j. |
The parties hereto agree to execute or cause to be executed the
Limited Power of Attorney attached hereto as Exhibit D. |
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k. |
The Servicer has and agrees to maintain a disaster recovery plan
which, in its reasonable opinion, will permit it to continue operations without
undue interruption in the event of fire, disaster, labor disruption, or Act of
God. |
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l. |
Servicer may cause any of its duties or obligations hereunder to
be performed by a sub-servicer so long as permitted by the Indenture. |
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m. |
Any term capitalized but not defined herein shall have the meaning
ascribed thereto in the Indenture. |
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n. |
It is expressly understood and agreed by the parties to this
Master Servicing Agreement that (a) this Master Servicing Agreement is executed
and delivered by Wilmington Trust Company ("WTC"), not individually or
personally but solely as Delaware Trustee of the Issuer, in the exercise of the
powers and authority conferred and vested in it as Delaware Trustee, (b) each of
the representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as personal representations, undertakings and
agreements by WTC but is made and intended for the purpose of binding only the
Issuer, (c) nothing herein contained shall be construed as creating any
liability on WTC, individually or personally, to perform any covenant either
expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties to this Master Servicing Agreement and by any
person claiming by, through or under the parties to this Master Servicing
Agreement and (d) under no circumstances shall WTC be personally liable for the
payment of any indebtedness or expenses of the Issuer or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Issuer under this Master Servicing Agreement or any other
document. |
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o. |
The Master Servicer will not, prior to the date which is one year
and one day after the termination of the Indenture, institute against the Issuer
any bankruptcy proceedings under any United States Federal or state bankruptcy
or similar law in connection with any obligations relating to this
Agreement. |
Each party to this Master Servicing Agreement waives its
right to jury trial.
IN WITNESS WHEREOF, the parties have hereunto set their hands by
their duly authorized officers as of the day and year first above written.
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COLLEGIATE FUNDING SERVICES EDUCATION LOAN TRUST 2004-A ("Issuer")
BY: Wilmington Trust Company, not in its individual
capacity but solely as Delaware Trustee
BY: /s/ Xxxxxxxx X. Xxxxx
Assistant Vice President
Collegiate Funding Master Servicing, L.L.C. ("Servicer")
BY:/s/ Xxxxx Xxxxxxxxxx
Treasurer |
EXHIBIT “A”
PRICING
1) Consolidation Loans
Only
| |
i) |
Loan Origination Fees: Fee to make disbursements on completed
applications for each eligible loan |
| |
|
(a) |
$20.00 for consolidation loans |
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ii) |
Conversion Fees: Fees to convert loan data on to s servicing
system. |
| |
|
(a) |
$12.00 for electronic files, |
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iii) |
Monthly Servicing Fee |
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|
(a) |
$3.55 for the first 12 months of repayment. |
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|
(b) |
After 12 months, the rate is $3.35. |
2) Xxxxxxxx and PLUS Loans Only
| |
i) |
Loan Origination Fees: Fee to make disbursements on completed
applications for each eligible loan. |
| |
|
(a) |
$15.00 for Xxxxxxxx and pre-approved PLUS |
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|
(b) |
$17.50 for PLUS requiring a credit check |
| |
|
(a) |
$2.00 for electronic files, |
| |
iii) |
Monthly Servicing Fee |
| |
|
(a) |
In-school, grace, and deferment status: $1.35 |
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|
(b) |
Repayment status months 1 through 12: $3.25 |
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|
(c) |
Repayment status greater than 12 months: $3.10 |
3) Fees applicable across all loan
programs
| |
ii) |
For errors not attributable to the Servicer: $150 per attempt. An
attempt is a series of activities pursued in order to restore ("cure") the
deficiency that caused the loss of federal benefits. |
| |
|
(a) |
Accounts transferred off the servicing system prior to termination
(without cause) of the Master Servicing Agreement: $20.00 |
| |
|
(b) |
Accounts transferred off servicing system due to breach of the
Master Servicing Agreement: no cost. |
| |
|
(c) |
Deconversion in conjunction with termination other than breach:
reasonable and demonstrable cost. |
EXHIBIT “B”
REPORTS
Such standard reports as may subsequently be agreed
upon by the Issuer and the Servicer
EXHIBIT “C”
CUSTODIAN AGREEMENTS
EXHIBIT “D”
LIMITED POWER OF ATTORNEY
WITNESSETH:
WHEREAS, Collegiate Funding Master Servicing, L.L.C., a Virginia limited
liability company (“CFS Master Servicing”) and Collegiate Funding
Services Education Loan Trust 2004-A, a Delaware Statutory trust (the
“Issuer”), are parties to the MASTER SERVICING AGREEMENT dated
as of April 1, 2004 (the “Master Servicing Agreement”); and
WHEREAS, pursuant to the Master Servicing Agreement, CFS Master Servicing will
perform substantially all of the obligations and duties with regard to servicing
of certain education loans (the “Financed Student Loans”)as provided
therein; and
WHEREAS, in order to carry out its obligations under the Master Servicing
Agreement with respect to the Financed Student Loans, CFS Master Servicing
requires the power to perform certain acts, including but not limited to
execution of promissory notes, assignment of notes to guaranty agencies or
insurers and filing of responses to bankruptcy notices, in the name of U.S. Bank
National Association, as eligible lender trustee for Collegiate Funding Services
Education Loan Trust 2004-A.
NOW
THEREFORE, CFS Master Servicing and the Issuer agree:
1. That the Issuer does hereby make and appoint CFS
Master Servicing as its true and lawful attorney-in-fact to do all things
necessary to carry out CFS Master Servicing's obligations under the Master
Servicing Agreement with respect to the Financed Student Loans, including but
not limited to the filing of proof of claim with bankruptcy courts. This
instrument shall be construed and interpreted as a limited power of attorney
(the "Limited Power of Attorney") and is not to be construed as granting any
powers to CFS Master Servicing other than those necessary to carry out its
obligations under the Master Servicing Agreement with respect to the Financed
Student Loans.
2.
That this Limited Power of Attorney is effective as of April 1, 2004, and shall
remain in force and effect until revoked in writing by the Issuer or until the
Master Servicing Agreement is terminated. This instrument shall supplement but
not replace the powers previously granted to CFS Master Servicing in the Master
Servicing Agreement.
The
undersigned, being duly authorized, has executed this Limited Power of
Attorney
