EXHIBIT 10.7
CERTAIN PORTIONS OF THIS EXHIBIT HAVE BEEN OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT. THE SYMBOL "[****]" HAS BEEN INSERTED IN PLACE OF THE PORTIONS SO
OMITTED.
Amendment Agreement
This Amendment Agreement is entered into as of August 1, 2001 among First
Union National Bank of Delaware ("Lender"), The Education Resources Institute
("XXXX"), SunTech, Inc. (the "Servicer") and Collegiate Funding Services, L.L.C.
("CFS"), collectively the "Parties".
WHEREAS, the Lender, XXXX, Servicer and CFS are Parties to various
agreements to promote and operate CFS' Real World Private Consolidation Loan
Program ("RWPCL Program") including the Private Consolidation Loan Origination
Responsibility Agreement dated as of June 12, 2001, the Guaranty Agreement dated
January 27, 1997, as amended, and the Master Origination and Servicing Agreement
dated January 18, 2001, as amended (the "Agreements") which provide for the
marketing, funding, insuring and servicing of consolidation of private education
loans; and
WHEREAS, the Agreements each include as an exhibit or attach, or refer to,
certain Underwriting, Origination, and Servicing Guidelines for the Real World
Private Consolidation Loan Program adopted as of June 12, 2001 (the
"Regulations"); and
WHEREAS, the Parties desire to amend the Agreements and/or the Regulations
as they may apply to the Agreements for the mutual benefit of the Parties, all
as hereinafter set forth in greater detail.
NOW THEREFORE, in consideration of the mutual covenants and agreements
contained herein and for other good and valuable consideration, the receipt and
sufficiency of which is acknowledged by each party, the Parties agree as follow.
1. On page 4 of the Regulations, the last bullet "United States
citizenship...." Is hereby amended to read in its entirety:
"United States citizenship or permanent residency - required for either
the Borrower or the Co-Borrower."
2. On page 5 of the Regulations, part "A. Citizenship" is hereby amended
to read in its entirety:
"The Borrower or the Co-Borrower must be a U.S. citizen or a permanent
resident of the United States. This U.S. citizen requirement will be
deemed satisfied if the `Yes' box is marked by the Borrower or, if
applicable, the Co-Borrower in item 4. or 20., respectively, of the
Private Consolidation Loan Application and Promissory Note. No further
verification is needed. If the Borrower or the Co-Borrower IS a Permanent
Resident, then the Originator must verify Permanent Residency status with
the Certification of U.S.
Citizenship (INS form N-560 or N-561). The Originator will forward
documentation of Permanent Residency to the Servicer along with the
Borrower file."
3. The Following procedures will be followed to establish the definitive
payoff amount for each underlying loan sought to be included in the RWPC Loan in
all instances in which a Payoff Request Form ("PORF") is not obtained to support
an underlying loan. When obtained, a PORF shall supercede any and all other loan
payoff/balance documentation that may be obtained and render unnecessary the
process, procedures and requirements described below:
A. For each Application, CFS shall transmit to the Borrower a copy of
the attached "Borrower Certification of Private Loan Balance" form
("Borrower Certification Form"). When CFS receives a completed
Borrower Certification Form it will compare the payoff balance for
each underlying loan supplied thereon with the balance for the
corresponding loan on the Borrower's credit bureau report obtained
no more than 90 days before receipt of the Borrower Certification
Form. See attachment "A" for the approved Borrower Certification
Form. In instances where the loan reported by the Borrower is not
listed on a credit bureau, CFS must follow the documentation
requirement contained in Paragraph 3(D) below.
B. If CFS determines that the Borrower-verified balance on the Borrower
Certification Form for a particular underlying loan is equal to or
less than 105% of the balance for such loan indicated on the credit
bureau report, the Parties shall accept the lesser of the Borrower
certified balance or the credit bureau report balance as the
accurate "pay-off" amount for such loan. The Borrower Certification
Form or credit bureau report, as applicable, shall constitute the
sole proof of the "payoff balance" required for such underlying
loan. The Borrower Certification Form and Borrower Certification of
Payoff Balance Comparison Worksheet (Attachment C) shall be included
in the Borrower File delivered by CFS to the Servicer. The
requirement to collect a Payoff Request Form ("PORF"), and include
the same in the Borrower File, is waived for underlying loans
described in this paragraph 3(B). See attachment "B" for the
hardcopy documentation requirements.
C. If CFS determines that the balance on the Borrower Certification
Form for a particular underlying loan is more than 105%, but less
than or equal to 110%, of the balance for such loan indicated on the
credit bureau report, CFS shall call the Borrower and encourage and
assist the Borrower in obtaining written loan payoff balance
documentation from the holder(s) of such loan (see Attachment "B"
for the acceptable documentation). Such written documentation shall
constitute the sole proof of the "payoff balance" required for such
underlying loan and shall, along with the Borrower Certification
Form and Borrower Certification Comparison Worksheets, be included
in the Borrower File delivered by CFS to the Servicer. The
requirement to collect a Payoff Request Form ("PORF"), and include
the same in the Borrower File, is waived for underlying loans
described in this paragraph 3(C).
D. If CFS determines that balance on the Borrower Certification Form
for a particular underlying loan is more than 110% of the balance
for such loan indicated on the credit bureau report, or if the
borrower's loan amount does not appear in the credit bureau
trade-line, CFS will only include such loans in the Consolidation
Loan if it obtains the Pay-Off Request Form(s) from the current
holder/servicer/lender, and in such event the PORF shall constitute
the sole acceptable proof of the "payoff balance" for such affected
loan and shall, be included in the Borrower File delivered by CFS to
the Servicer.
E. In its review of the Borrower File as required under the Master
Origination and Servicing Agreement dated January 18, 2001, as
amended, Servicer shall verify that the File contains each form of
document for each underlying loan as noted by CFS on the BORROWER
PAYOFF CERTIFICATION OF EDUCATION LOAN BALANCES VERIFICATION
CHECKLIST (attached hereto as Attachment D). Servicer shall have no
obligation whatsoever to investigate or otherwise verify the
accuracy of the information contained on any Attachment D; it being
understood that Servicer's sole obligation under this paragraph is
to verify that CFS forwarded each of the documents that CFS listed
on Attachment D.
F. As long as this Section 3 is in effect, Lender and XXXX shall accept
the Borrower certification contained in the Application/ Promissory
Note and in the Borrower Certification as acceptable certification
that the loans listed for consolidation on such documents were used
for qualifying education purposes.
G. For each RWPC Loan, the principal loan amount covered by TERI's
Guarantee shall equal the aggregate amount of the underlying loan
payoff balances (including interest/fees) listed on the (i) Borrower
Certification Form, credit bureau report or PORF, as applicable for
underlying loans described in Section 3(B) above, (ii) Attachment B
documentation or PORF, as applicable, for underlying loans described
in Section 3(C), and (iii) the PORF for underlying loans described
in Section 3(D), provided that the principal amount of such
Guarantee shall in no event exceed the principal amount of the RWPC
loan actually disbursed by the Lender.
H. When the loan payoff balance for one or more underlying loans
included in a RWPC Loan is supported by a Borrower Certification
Form and/or Attachment B documentation, such original underlying
loan(s) shall be deemed by the Parties to be non-XXXX-guaranteed
loans for purposes of calculating the XXXX guaranty fee pursuant to
"IV. Payment of Guaranty Fees to XXXX" of the Regulations.
I. All parties agree that the Borrower Certification Form process
outlined in Sections 3(A)-(H) is subject to termination by XXXX and
Lender effective on any October 1st during the term of the
Agreement. To become effective, notice of such termination must be
given to CFS no less than thirty (30) days prior to the desired
October 1st termination date. Lender may also terminate the Borrower
Certification Form process outlined in Sections 3(A)-(H) at anytime
upon 10 days written notice to CFS if more than two percent (2%) of
Borrower Files provided
by CFS to Servicer in any particular calendar month do not at the
time of initial submission to Servicer include the completed
Borrower Certification of Payoff Balance Comparison Worksheet, the
Borrower Certification Form and, as applicable, the alternative
hardcopy documentation required under Paragraph 3(C), or the PORF
required under Paragraph 3(D), provided further that such
noncompliance persists for three (3) consecutive calendar months.
Servicer's document exceptions list provided to CFS pursuant to
Section 6(D) of the Private Consolidation Loan Origination
Responsibility Agreement dated as of June 12, 2001 shall, absent
clear and convincing evidence to the contrary, be conclusive proof
of whether the PORF, or, in the absence of such PORF as contemplated
in Paragraphs 3(B) & (C), whether the Borrower Certification of
Payoff Balance Comparison Worksheet, the Borrower Certification
Form, and solely for underlying loans described in Paragraph 3(C)
the alternative hardcopy documentation required thereunder, were
contained in the Borrower Files at time of submission to Servicer.
Any termination under this paragraph 3(I) shall terminate
application of sections 3(A) through 3(H) above on a prospective
basis only and the Parties will thereafter, with respect to all
Consolidation Loans that have not had at least one disbursement
issued prior to the effective date of termination, revert to the
PORF process originally outlined in the Agreements.
4. CFS will supply to Lender each week a list of loan applications
(identifying borrower name, SSN, and payoff balance) with tolerances between
105.00% and 110.01% submitted for funding by CFS during the previous calendar
week. CFS will provide to Lender within 5 business days of Lender's request all
of the required loan payoff documentation for a random sample of Loans funded by
Lender in any month for no more than 50 Loans (i.e., as applicable, the copy of
the Borrower Certification Forms, the credit reports used to determine the
payoff variance percentages, the Borrower Certification Comparison of Balance
Payoff Worksheets, the PORFs, and the alternative hardcopy documentation
required under Paragraph 3(C)).
5. Except as explicitly set forth herein, nothing in this Amendment
Agreement is intended, nor shall it, release, remove, modify, alter, or amend
any obligation, duty, or responsibility of any party as set forth in the
Agreements. This Amendment Agreement may be executed in counterparts, each of
which may be a fax copy of an original but all of which, taken together, shall
constitute one and the same instrument.
IN WITNESS WHEREOF, the Parties have set their hands hereto.
FIRST UNION NATIONAL BANK OF DELAWARE ("Lender")
/s/ Xxxxxxx Xxxxxxx
------------------------------
By: Xxxxxxx Xxxxxxx
COLLEGIATE FUNDING SERVICES, LLC ("CFS")
/s/ W. Xxxxx XxXxxx
------------------------------
By: W. Xxxxx XxXxxx
THE EDUCATION RESOURCES INSTITUTE (XXXX)
/s/ Xxx X. Xxxxx
------------------------------
By: Xxx X. Xxxxx
SUNTECH, INC. ("Servicer")
/s/ Xxxxxxx Xxxxxxxx
------------------------------
By: Xxxxxxx Xxxxxxxx
ATTACHMENTS: Attachment "A" - Borrower Certification Form
Attachment "B" - Payoff Documentation
Attachment "C" - Borrower certification of Payoff
Balance Comparison Worksheet
Attachment "D" - Borrower Payoff Certification of
Education Loan Balances Verification Checklist
AMENDMENT AGREEMENT
Amendment to the Agreement dated as of August 1, 2001, among First Union
National Bank of Delaware ("Lender"), The Education Resources Institute
("XXXX"), Suntech, Inc (the "Servicer") and Collegiate Funding Services, L.L.C.
("CFS"), collectively the "Parties". This Amendment is made effective this 20th
day of February, 2002.
Section 3 - Paragraph B shall be amended to read as follows with respect to all
RWPCL loans not already funded as of the date of this Amendment:
If CFS determines that the Borrower-verified balance on the Borrower
Certification Form for a particular underlying loan is equal to or less than
105% of the balance for such loan indicated on the credit bureau report, the
Parties shall accept the greater of the Borrower certified balance or the credit
bureau report balance as the accurate "pay-off" amount for such loan. The
Borrower Certification Form or credit bureau report, as applicable, shall
constitute the sole proof of the "payoff balance" required for such underlying
loan. The Borrower Certification Form and Borrower Certification of Payoff
Balance Comparison Worksheet (Attachment C) shall be included in the Borrower
File delivered by CFS to the Servicer. The requirement to collect a Payoff
Request Form ("PORF"), and include the same in the Borrower File, is waived for
underlying loans described in this paragraph 3(B). See attachment "B" for the
hardcopy documentation requirements.
FIRST UNION NATIONAL BANK OF DELAWARE
/s/ Xxxxxxx Xxxxxxx
-----------------------------
By: Xxxxxxx Xxxxxxx
Date: 7-15-02
COLLEGIATE FUNDING SERVICES, LLC
/s/ W. Xxxxx XxXxxx
-----------------------------
By: W. Xxxxx XxXxxx
Dated: 7/10/02
THE EDUCATION RESOURCES INSTITUTE (XXXX)
/s/ Xxxxxx Xxxxxx
-----------------------------
By: Xxxxxx Xxxxxx
Dated: 7/10/02
SunTech, Inc.
/s/ Xxxxxxx X. Xxxxxxxx
-----------------------------
By: Xxxxxxx X. Xxxxxxxx
Dated: 7/15/02
