EXHIBIT 99.4
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SERVICING AGREEMENT
among
XXXXXX XXX SERVICING L.P.,
STUDENT LOAN MARKETING ASSOCIATION,
not in its individual capacity
but solely as Administrator
SLM STUDENT LOAN TRUST 2003-12,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Eligible Lender Trustee
and
THE BANK OF NEW YORK,
not in its individual capacity
but solely as Indenture Trustee
Dated as of November 25, 2003
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TABLE OF CONTENTS
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ARTICLE I
Section 1.01 Definitions and Usage......................................................................... 1
ARTICLE II
Section 2.01 Custody of Trust Student Loan Files........................................................... 1
Section 2.02 Duties of Servicer as Custodian............................................................... 2
Section 2.03 Maintenance of and Access to Records.......................................................... 2
Section 2.04 Release of Documents.......................................................................... 2
Section 2.05 Instructions; Authority to Act................................................................ 3
Section 2.06 [RESERVED].................................................................................... 3
Section 2.07 Effective Period and Termination.............................................................. 3
ARTICLE III
Section 3.01 Duties of Servicer............................................................................ 3
Section 3.02 Collection of Trust Student Loan Payments..................................................... 4
Section 3.03 Realization upon Trust Student Loans.......................................................... 5
Section 3.04 No Impairment................................................................................. 6
Section 3.05 Purchase of Trust Student Loans; Reimbursement................................................ 6
Section 3.06 Primary Servicing Fee; Carryover Servicing Fee................................................ 8
Section 3.07 Access to Certain Documentation and Information Regarding Trust Student Loans................. 8
Section 3.08 Servicer Expenses............................................................................. 8
Section 3.09 Appointment of Subservicer.................................................................... 9
Section 3.10 Reports...................................................................................... 9
Section 3.11 Covenants and Agreements of the Issuer, Administrator, Eligible Lender Trustee and
Servicer................................................................................... 10
Section 3.12 Special Programs............................................................................. 11
Section 3.13 Financial Statements......................................................................... 11
Section 3.14 Insurance.................................................................................... 11
Section 3.15 Administration Agreement..................................................................... 11
Section 3.16 Lender Identification Number................................................................. 11
ARTICLE IV
Section 4.01 Representations of Servicer.................................................................. 12
Section 4.02 Indemnities of Servicer...................................................................... 13
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Section 4.03 Merger or Consolidation of, or Assumption of the Obligations of, Servicer.................... 14
Section 4.04 Limitation on Liability of Servicer.......................................................... 14
Section 4.05 Xxxxxx Xxx Servicing L.P. Not to Resign as Servicer.......................................... 15
ARTICLE V
Section 5.01 Servicer Default............................................................................. 15
Section 5.02 Appointment of Successor..................................................................... 16
Section 5.03 Notification to Noteholders.................................................................. 17
Section 5.04 Waiver of Past Defaults...................................................................... 17
ARTICLE VI
Section 6.01 Amendment.................................................................................... 17
Section 6.02 Notices...................................................................................... 18
Section 6.03 Counterparts................................................................................. 19
Section 6.04 Entire Agreement; Severability............................................................... 20
Section 6.05 Governing Law................................................................................ 20
Section 6.06 Relationship of Parties...................................................................... 20
Section 6.07 Captions..................................................................................... 20
Section 6.08 Nonliability of Directors, Officers and Employees of Servicer, the Eligible Lender
Trustee, the Indenture Trustee and the Administrator....................................... 20
Section 6.09 Assignment................................................................................... 20
Section 6.10 Limitation of Liability of Eligible Lender Trustee and Indenture Trustee..................... 20
Attachment A Schedule of Fees
Attachment B Servicer Locations
Attachment C Reports
Appendix
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SERVICING AGREEMENT
Xxxxxx Mae Servicing L.P. (the "Servicer"), a Delaware limited
partnership, hereby agrees with (i) SLM Student Loan Trust 2003-12 (the
"Issuer"), (ii) Chase Manhattan Bank USA, National Association, a national
banking association, (not in its individual capacity but solely in its capacity
as eligible lender trustee (the "Eligible Lender Trustee") under an amended and
restated trust agreement dated as of November 25, 2003 among SLM Funding LLC,
the Eligible Lender Trustee and The Bank of New York, not in its individual
capacity but solely in its capacity as the indenture trustee (the "Indenture
Trustee"), under an indenture (the "Indenture") dated as of November 1, 2003
among SLM Student Loan Trust 2003-12, the Eligible Lender Trustee and the
Indenture Trustee, and (iii) the Student Loan Marketing Association, not in its
individual capacity but in its capacity as administrator (the "Administrator")
under the Administration Agreement as follows:
WHEREAS, the Eligible Lender Trustee will acquire certain
education loans to be held in the trust formed pursuant to an agreement (the
"Short-Form Trust Agreement"), dated as of November 4, 2003, between SLM Funding
LLC and the Eligible Lender Trustee, as amended and restated by an Amended and
Restated Trust Agreement (the "Trust Agreement") dated as of November 25, 2003,
among SLM Funding LLC, the Eligible Lender Trustee and the Indenture Trustee;
WHEREAS, the Issuer will issue notes (the "Notes") pursuant to
the Indenture, which Notes are payable from the assets of the Issuer; and
WHEREAS, the Issuer, the Administrator and the Eligible Lender
Trustee desire the Servicer to service the education loans held by the Eligible
Lender Trustee on behalf of the Issuer, and the Servicer is willing to service
those education loans for the Issuer, the Administrator, the Eligible Lender
Trustee and the Indenture Trustee.
NOW, THEREFORE, in consideration of the premises and mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Section 1.01 Definitions and Usage. Except as otherwise
specified herein or as the context may otherwise require, capitalized terms used
but not otherwise defined herein are defined in Appendix A hereto, which also
contains rules as to usage that shall be applicable herein.
ARTICLE II
Section 2.01 Custody of Trust Student Loan Files. To assure
uniform quality in servicing the Trust Student Loans and to reduce
administrative costs, the Issuer hereby revocably appoints the Servicer, and the
Servicer hereby accepts such appointment, to act for the benefit of the Issuer
and the Indenture Trustee as custodian of the following documents or instruments
(collectively the "Trust Student Loan Files") which are hereby constructively
delivered to the Indenture Trustee, as pledgee of the Issuer with respect to
each Trust Student Loan:
(a) the original fully executed copy of the note (or all
electronic records evidencing the same) evidencing the Trust Student Loan; and
(b) any and all other documents and computerized records that
the Servicer shall keep on file, in accordance with its customary procedures,
relating to such Trust Student Loan or any obligor with respect thereto.
Section 2.02 Duties of Servicer as Custodian. The Servicer
shall hold the Trust Student Loan Files for the benefit of the Issuer and the
Indenture Trustee and maintain such accurate and complete accounts, records and
computer systems pertaining to each Trust Student Loan File as shall enable the
Issuer to comply with this Agreement. In performing its duties as custodian the
Servicer shall act with reasonable care, using that degree of skill and
attention that the Servicer exercises with respect to the student loan files
relating to comparable student loans that the Servicer services on behalf of SLM
Corporation or any of its Affiliates and shall ensure that it fully complies
with all applicable Federal and state laws, including the Higher Education Act,
with respect thereto. The Servicer shall take all actions necessary with respect
to the Trust Student Loan Files held by it under this Agreement and of the
related accounts, records and computer systems, in order to enable the Issuer or
the Indenture Trustee to verify the accuracy of the Servicer's record keeping
with respect to the Servicer's obligations as custodian hereunder. The Servicer
shall promptly report to the Issuer, the Administrator and the Indenture Trustee
any material failure on its part to hold the Trust Student Loan Files and
maintain its accounts, records and computer systems as herein provided and
promptly take appropriate action to remedy any such failure. Nothing herein
shall be deemed to require an initial review or any periodic review by the
Issuer, the Eligible Lender Trustee or the Indenture Trustee of the Trust
Student Loan Files. If in the reasonable judgment of the Eligible Lender Trustee
it is necessary to preserve the interests of the Noteholders and the Trust in
the Trust Student Loans or at the request of the Administrator, the Servicer
shall transfer physical possession of the notes evidencing the Trust Student
Loans to the Eligible Lender Trustee, the Indenture Trustee or any other
custodian for either of them designated by the Eligible Lender Trustee.
Section 2.03 Maintenance of and Access to Records. The
Servicer shall maintain each Trust Student Loan File at one of its offices
specified in Attachment B to this Agreement or at such other office as shall be
consented to by the Issuer and the Indenture Trustee upon written notice to the
Issuer and the Indenture Trustee. Upon reasonable prior notice, the Servicer
shall make available to the Issuer and the Indenture Trustee or their respective
duly authorized representatives, attorneys or auditors a list of locations of
the Trust Student Loan Files and the related accounts, records and computer
systems maintained by the Servicer at such times during normal business hours as
the Issuer or the Indenture Trustee shall instruct.
Section 2.04 Release of Documents. Upon written instruction
from the Indenture Trustee, the Servicer shall release any Trust Student Loan
File to the Indenture Trustee, the Indenture Trustee's agent, or the Indenture
Trustee's designee, as the case may be, at such place or places as the Indenture
Trustee may reasonably designate, as soon as practicable.
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The Indenture Trustee shall cooperate with the Servicer to provide the Servicer
with access to the Trust Student Loan Files in order for the Servicer to
continue to service the Trust Student Loans after the release of the Trust
Student Loan Files. In the event the Servicer is not provided access to the
Trust Student Loan Files, the Servicer shall not be deemed to have breached its
obligations pursuant to Section 3.1, 3.2, 3.3 or 3.4 if it is unable to perform
such obligations due to its inability to have access to the Trust Student Loans
Files. The Servicer shall not be liable for any losses with respect to the
servicing of such Trust Student Loans arising after the release of the related
Trust Student Loan Files to the extent the losses are attributable to the
Servicer's inability to have access to the related Trust Student Loan Files.
Section 2.05 Instructions; Authority to Act. The Servicer
shall be deemed to have received proper instructions with respect to the Trust
Student Loan Files upon its receipt of written instructions signed by a
Responsible Officer of the Indenture Trustee.
Section 2.06 [RESERVED].
Section 2.07 Effective Period and Termination. Xxxxxx Xxx
Servicing L.P.'s appointment as custodian shall become effective as of the
Closing Date and shall continue in full force and effect for so long as Xxxxxx
Mae Servicing L.P. shall remain the Servicer hereunder. If Xxxxxx Xxx Servicing
L.P. or any successor Servicer shall resign as Servicer in accordance with the
provisions of this Agreement or if all the rights and obligations of Xxxxxx Mae
Servicing L.P. or any such successor Servicer shall have been terminated under
Section 5.1, the appointment of Xxxxxx Xxx Servicing L.P. or such successor
Servicer as custodian shall be terminated simultaneously with the effectiveness
of such resignation or termination. On or prior to the effective date of any
resignation or termination of such appointment, the Servicer shall deliver the
Trust Student Loan Files to the successor Servicer, the Indenture Trustee or the
Indenture Trustee's agent, at the direction of the Indenture Trustee, at such
place or places as the Indenture Trustee may reasonably designate. In
establishing an effective date for the termination of the Servicer as custodian
of the Trust Student Loan Files, the parties shall provide for a reasonable
period for the Servicer to deliver the Trust Student Loan Files to its
designated successor.
ARTICLE III
Section 3.01 Duties of Servicer. The Servicer, for the benefit
of the Issuer (to the extent provided herein), shall manage, service, administer
and make collections on the Trust Student Loans with reasonable care, using that
degree of skill and attention that the Servicer exercises with respect to
comparable student loans that it services on behalf of SLM Corporation or any of
its Affiliates, beginning on the Closing Date until the Trust Student Loans are
paid in full. Without limiting the generality of the foregoing or of any other
provision set forth in this Agreement and notwithstanding any other provision to
the contrary set forth herein, the Servicer shall manage, service, administer
and make collections with respect to the Trust Student Loans (including
collection of any Interest Subsidy Payments and Special Allowance Payments on
behalf of the Eligible Lender Trustee) in accordance with, and otherwise comply
with, all applicable Federal and state laws, including all applicable rules,
regulations and other requirements of the Higher Education Act and the
applicable Guarantee Agreement, the failure to comply with which would adversely
affect the eligibility of one or more of the Trust Student
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Loans for Federal reinsurance or Interest Subsidy Payments or Special Allowance
Payments or one or more of the Trust Student Loans for receipt of Guarantee
Payments.
The Servicer's duties shall include, but shall not be limited
to, collection and posting of all payments, responding to inquiries of borrowers
on such Trust Student Loans, monitoring borrowers' status, making required
disclosures to borrowers, performing due diligence with respect to borrower
delinquencies, sending payment coupons to borrowers and otherwise establishing
repayment terms, reporting tax information to borrowers, if applicable,
accounting for collections and furnishing monthly statements with respect
thereto to the Administrator. The Servicer shall follow its customary standards,
policies and procedures in performing its duties as Servicer. Without limiting
the generality of the foregoing, the Servicer is authorized and empowered to
execute and deliver, on behalf of itself, the Issuer, the Eligible Lender
Trustee, the Indenture Trustee, and the Noteholders or any of them, instruments
of satisfaction or cancellation, or partial or full release or discharge, and
all other comparable instruments, with respect to such Trust Student Loans;
provided, however, that the Servicer agrees that it will not (a) permit any
rescission or cancellation of a Trust Student Loan except as ordered by a court
of competent jurisdiction or governmental authority or as otherwise consented to
in writing by the Eligible Lender Trustee and the Indenture Trustee provided,
however, that the Servicer may write off any delinquent Trust Student Loan if
the remaining balance of the borrower's account is less than $50 or (b)
reschedule, revise, defer or otherwise compromise with respect to payments due
on any Trust Student Loan except pursuant to any applicable interest only,
deferral or forbearance periods or otherwise in accordance with all applicable
standards, guidelines and requirements with respect to the servicing of Student
Loans; provided further, however, that the Servicer shall not agree to any
reduction of yield with respect to any Trust Student Loan (either by reducing
borrower payments or reducing principal balance) except as permitted in
accordance with Section 3.12 or otherwise if, and to the extent, the Servicer or
the Administrator reimburses the Issuer in an amount sufficient to offset any
such effective yield reduction made by the Servicer consistent with such
customary servicing procedures as it follows with respect to comparable student
loans which it services on behalf of the SLM Corporation or any of its
Affiliates. The Eligible Lender Trustee on behalf of the Issuer hereby grants a
power of attorney and all necessary authorization to the Servicer to maintain
any and all collection procedures with respect to the Trust Student Loans,
including filing, pursuing and recovering claims with the Guarantors for
Guarantee Payments and with the Department for Interest Subsidy Payments and
Special Allowance Payments and taking any steps to enforce such Trust Student
Loans such as commencing a legal proceeding to enforce a Trust Student Loan in
the names of the Issuer, the Eligible Lender Trustee, the Indenture Trustee, and
the Noteholders. The Eligible Lender Trustee shall upon the written request of
the Servicer furnish the Servicer with any other powers of attorney and other
documents reasonably necessary or appropriate to enable the Servicer to carry
out its servicing and administrative duties hereunder.
Section 3.02 Collection of Trust Student Loan Payments.
A. The Servicer shall make reasonable efforts (including all
efforts that may be specified under the Higher Education Act or any Guarantee
Agreement) to collect all payments called for under the terms and provisions of
the Trust Student Loans as and when the same shall become due and shall follow
such collection procedures as it follows with respect to comparable student
loans that it services on behalf of SLM Corporation or any of its Affiliates.
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The Servicer shall allocate collections with respect to the Trust Student Loans
between principal, interest and fees in accordance with Section 2.5 of the
Administration Agreement. The Servicer may in its discretion waive any late
payment charge or any other fees that may be collected in the ordinary course of
servicing a Trust Student Loan. The Servicer may, at its option, retain any late
payment charges that it collects.
B. The Servicer shall make reasonable efforts to claim, pursue
and collect all Guarantee Payments from the Guarantors pursuant to the Guarantee
Agreements with respect to any of the Trust Student Loans as and when the same
shall become due and payable, shall comply with all applicable laws and
agreements with respect to claiming, pursuing and collecting such payments and
shall follow such practices and procedures as it follows with respect to
comparable guarantee agreements and student loans that it services on behalf of
SLM Corporation or any of its Affiliates. In connection therewith, the Servicer
is hereby authorized and empowered to convey to any Guarantor the note and the
related Trust Student Loan File representing any Trust Student Loan in
connection with submitting a claim to such Guarantor for a Guarantee Payment in
accordance with the terms of the applicable Guarantee Agreement. All amounts so
collected by the Servicer shall constitute Available Funds for the applicable
Collection Period and shall be deposited into the Collection Account or
transferred to the Administrator in accordance with Section 2.4 of the
Administration Agreement. The Eligible Lender Trustee shall, upon the written
request of the Servicer, furnish the Servicer with any power of attorney and
other documents necessary or appropriate to enable the Servicer to convey such
documents to any Guarantor and to make such claims.
C. The Servicer on behalf of the Eligible Lender Trustee
shall, on behalf of the Issuer, make reasonable efforts to claim, pursue and
collect all Interest Subsidy Payments and Special Allowance Payments from the
Department with respect to any of the Trust Student Loans as and when the same
shall become due and payable, shall comply with all applicable laws and
agreements with respect to claiming, pursuing and collecting such payments and
shall follow such practices and procedures as the Servicer follows with respect
to comparable student loans that it services on behalf of the SLM Corporation or
any of its Affiliates. All amounts so collected by the Servicer shall constitute
Available Funds for the applicable Collection Period and shall be deposited into
the Collection Account or transferred to the Administrator in accordance with
Section 2.4 of the Administration Agreement. In connection therewith, the
Servicer shall prepare and file with the Department on a timely basis all claims
forms and other documents and filings necessary or appropriate in connection
with the claiming of Interest Subsidy Payments and Special Allowance Payments on
behalf of the Eligible Lender Trustee and shall otherwise assist the Eligible
Lender Trustee in pursuing and collecting such Interest Subsidy Payments and
Special Allowance Payments from the Department. The Eligible Lender Trustee
shall upon the written request of the Servicer furnish the Servicer with any
power of attorney and other documents reasonably necessary or appropriate to
enable the Servicer to prepare and file such claims forms and other documents
and filings.
Section 3.03 Realization upon Trust Student Loans. For the
benefit of the Issuer, the Servicer shall use reasonable efforts consistent with
its servicing practices and procedures that it utilizes with respect to
comparable student loans that it services on behalf of the Student Loan
Marketing Association and including all efforts that may be specified under the
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Higher Education Act or any Guarantee Agreement in its servicing of any
delinquent Trust Student Loans.
Section 3.04 No Impairment. The Servicer shall not impair the
rights of the Issuer, the Eligible Lender Trustee, the Indenture Trustee, or
Noteholders in such Trust Student Loans.
Section 3.05 Purchase of Trust Student Loans; Reimbursement.
A. The Servicer, the Administrator, the Eligible Lender
Trustee and the Indenture Trustee shall give notice to the other parties
promptly, in writing, upon the discovery of any breach of the provisions of
Section 3.1, 3.2, 3.3 or 3.4 which has a material adverse effect on the interest
of the Issuer. In the event of such a material breach which is not curable by
reinstatement of the Guarantor's guarantee of such Trust Student Loan, the
Servicer shall purchase the affected Trust Student Loan not later than 120 days
following the earlier of the date of discovery of such material breach and the
date of receipt of the Guarantor reject transmittal form with respect to such
Trust Student Loan. In the event of a material breach with respect to such Trust
Student Loan which is curable by reinstatement of the Guarantor's guarantee of
such Trust Student Loan, unless the material breach shall have been cured within
360 days following the earlier of the date of discovery of such material breach
and the date of receipt of the Guarantor reject transmittal form with respect to
such Trust Student Loan, the Servicer shall purchase such Trust Student Loan not
later than the sixtieth day following the end of such 360-day period. The
purchase price hereunder will be the unpaid principal amount of such Trust
Student Loan plus accrued interest (calculated using the applicable percentage
that would have been insured pursuant to Section 428(b)(1)(G) of the Higher
Education Act) plus an amount equal to all forfeited Interest Subsidy Payments
and Special Allowance Payments with respect to such Trust Student Loan. In
consideration of the purchase of any such Trust Student Loan pursuant to this
Section 3.5, the Servicer shall remit the Purchase Amount in the manner and at
the time specified in Section 2.6 of the Administration Agreement. Any breach
that relates to compliance with the requirements of the Higher Education Act or
of the applicable Guarantor but that does not affect such Guarantor's obligation
to guarantee payments of a Trust Student Loan will not be considered to have a
material adverse effect for purposes of this Section 3.5A.
B. In addition, if any breach of Section 3.1, 3.2, 3.3 or 3.4
by the Servicer does not trigger such purchase obligation but does result in the
refusal by a Guarantor to guarantee all or a portion of the accrued interest (or
any obligation of the Issuer to repay such interest to a Guarantor), or the loss
(including any obligation of the Issuer to repay to the Department) of Interest
Subsidy Payments and Special Allowance Payments, with respect to any Trust
Student Loan affected by such breach, then the Servicer shall reimburse the
Issuer in an amount equal to the sum of all such nonguaranteed interest amounts
that would have been owed to the Issuer by the Guarantor but for such breach by
the Servicer and such forfeited Interest Subsidy Payments or Special Allowance
Payments by netting such sum against the Servicing Fee payable to the Servicer
for such period and remitting any additional amounts owed in the manner
specified in Section 2.6 of the Administration Agreement not later than (i) the
last day of the next Collection Period ending not less than 60 days from the
date of the Guarantor's refusal to guarantee all or a portion of accrued
interest or loss of Interest Subsidy Payments or Special Allowance Payments, or
(ii) in the case where the Servicer reasonably believes such amounts are
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likely to be collected, not later than the last day of the next Collection
Period ending not less than 360 days from the date of the Guarantor's refusal to
guarantee all or a portion of accrued interest or loss of Interest Subsidy
Payments or Special Allowance Payments. At the time such payment is made, the
Servicer shall not be required to reimburse the Issuer for interest that is then
capitalized, however, such amounts shall be reimbursed if the borrower
subsequently defaults and such capitalized interest is not paid by the
Guarantor.
C. Anything in this Section 3.5 to the contrary
notwithstanding, if as of the last Business Day of any month the aggregate
outstanding principal amount of Trust Student Loans with respect to which claims
have been filed with and rejected by a Guarantor or with respect to which the
Servicer determines that claims cannot be filed pursuant to the Higher Education
Act as a result of a breach by the Servicer or the Depositor, exceeds 1% of the
Pool Balance, the Servicer or the Seller, as appropriate, shall purchase, within
30 days of a written request of the Eligible Lender Trustee or Indenture
Trustee, such affected Trust Student Loans in an aggregate principal amount such
that after such purchase the aggregate principal amount of such affected Trust
Student Loans is less than 1% of the Pool Balance. The Trust Student Loans to be
purchased by the Servicer or the Depositor pursuant to the preceding sentence
shall be based on the date of claim rejection (or date of notice referred to in
the first sentence of this Section 3.5) with the Trust Student Loans with the
earliest such date to be purchased first.
D. In lieu of repurchasing Trust Student Loans pursuant to
this Section 3.5, the Servicer may, at its option, with the prior consent of the
Administrator, substitute Student Loans or arrange for the substitution of
Student Loans which are substantially similar as of the date of substitution on
an aggregate basis to the Trust Student Loans for which they are being
substituted with respect to the following characteristics:
(a) status (i.e., in-school, grace, deferment, forbearance or
repayment),
(b) program type (i.e., unsubsidized or subsidized
Consolidation Loans (pre-1993 vs. post-1993)),
(c) school type,
(d) total return,
(e) principal balance, and
(f) remaining term to maturity.
In addition, each substituted Student Loan shall comply, as of the date of
substitution, with the representations and warranties made by the Depositor in
the Sale Agreement. In choosing Student Loans to be substituted pursuant to this
subsection D, the Servicer shall make a reasonable determination that the
Student Loans to be substituted will not have a material adverse effect on the
Noteholders or any Swap Counterparty.
In the event the Servicer elects to substitute Student Loans
pursuant to this Section 3.5 and the Administrator consents to such
substitution, the Servicer will remit to the Administrator the amount of any
shortfall between the Purchase Amount of the substituted
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Student Loans and the Purchase Amount of the Trust Student Loans for which they
are being substituted. The Servicer shall also remit to the Administrator an
amount equal to all nonguaranteed interest amounts that would have been owed to
the Issuer by the Guarantor but for the breach of the Servicer and forfeited
Interest Subsidy Payments and Special Allowance Payments with respect to the
Trust Student Loans in the manner provided in Section 2.6 of the Administration
Agreement.
E. The sole remedy of the Issuer, the Eligible Lender Trustee,
the Indenture Trustee and the Noteholders with respect to a breach pursuant to
Section 3.1, 3.2, 3.3 or 3.4 shall be to require the Servicer to purchase Trust
Student Loans, to reimburse the Issuer as provided above or to substitute
Student Loans pursuant to this Section.
F. The Eligible Lender Trustee shall have no duty to conduct
any affirmative investigation as to the occurrence of any condition requiring
the purchase of any Trust Student Loan or the reimbursement for any interest
penalty pursuant to this Section 3.5.
G. The Servicer shall not be deemed to have breached its
obligations pursuant to Section 3.1, 3.2, 3.3 or 3.4 if it is rendered unable to
perform such obligations, in whole or in part, by a force outside the control of
the parties hereto (including acts of God, acts of war, fires, earthquakes,
hurricanes, floods and other disasters). The Servicer shall diligently perform
its duties under this Agreement as soon as practicable following the termination
of such interruption of business.
Section 3.06 Primary Servicing Fee; Carryover Servicing Fee.
The Primary Servicing Fee for each calendar month and any Carryover Servicing
Fees payable on any Distribution Date in arrears by the Issuer shall be equal to
the amounts determined by reference to the schedule of fees attached hereto as
Attachment A. Notwithstanding anything to the contrary contained herein or in
any other Basic Document, the Servicer shall be entitled to receive any
Carryover Servicing Fee on any Distribution Date only if and to the extent that
sufficient funds are available pursuant to Section 2.8(l) of the Administration
Agreement.
Section 3.07 Access to Certain Documentation and Information
Regarding Trust Student Loans. Upon reasonable prior notice, the Servicer shall
provide to the Administrator and its agents access to the Trust Student Loan
Files and shall permit the Administrator to examine and make copies of, and
abstracts from, the records and books of account of the Servicer relating to the
Trust Student Loans and shall permit the Administrator to undertake periodic
site reviews of the Servicer's operations relating to the servicing of the Trust
Student Loans (including on the premises of any agent of the Servicer).
Reasonable access shall be afforded to the Administrator without charge, but
only upon reasonable request and during the normal business hours at the
respective offices of the Servicer. Nothing in this Section shall affect the
obligation of the Servicer to observe any applicable law prohibiting disclosure
of information regarding the Obligors and the failure of the Servicer to provide
access to information as a result of such obligation shall not constitute a
breach of this Section.
Section 3.08 Servicer Expenses. The Servicer shall be required
to pay all expenses incurred by it in connection with its activities hereunder,
including fees and
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disbursements of independent accountants, taxes imposed on the Servicer and
expenses incurred in connection with distributions and reports to the
Administrator, provided, however, the Carryover Servicing Fee will be subject to
increase agreed to by the Administrator, the Eligible Lender Trustee and the
Servicer to the extent that a demonstrable and significant increase occurs in
the costs incurred by the Servicer in providing the services to be provided
hereunder, whether due to changes in applicable governmental regulations,
Guarantor program requirements or regulations or postal rates. Notwithstanding
anything to the contrary contained herein, the Servicer may, at its option,
collect fees from the Borrowers in connection with sending payment histories and
amortization schedules to Borrowers, faxing documents to Borrowers, providing
credit reference letters to Borrowers, providing a "speed pay" payment option to
Borrowers and for other similar optional services requested by a Borrower and
may retain such fees. The Servicer may also, at its option, collect fees from
Borrowers for returned check processing or other insufficient fund transactions
and may assess such fees from the Borrower's Trust Student Loan payment and
retain such fees.
Section 3.09 Appointment of Subservicer. The Servicer may at
any time, upon the written consent of the Administrator, appoint a subservicer
to perform all or any portion of its obligations as Servicer hereunder;
provided, however, that any applicable Rating Agency Condition shall have been
satisfied in connection therewith; provided further that the Servicer shall
remain obligated and be liable to the Issuer, the Eligible Lender Trustee, the
Indenture Trustee and the Noteholders for the servicing and administering of the
Trust Student Loans in accordance with the provisions hereof without diminution
of such obligation and liability by virtue of the appointment of such
subservicer and to the same extent and under the same terms and conditions as if
the Servicer alone were servicing and administering the Trust Student Loans. The
fees and expenses of the subservicer shall be as agreed between the Servicer and
its subservicer from time to time and none of the Issuer, the Eligible Lender
Trustee, the Indenture Trustee or the Noteholders shall have any responsibility
therefor. With respect to satisfying the Rating Agency Condition referred to
above, the term "subservicer" shall be deemed not to include systems providers,
systems developers or systems maintenance contractors, collection agencies,
credit bureaus, lock box providers, mail service providers and other similar
types of service providers.
Section 3.10 Reports. With respect to Trust Student Loans,
Servicer shall prepare reports and data and furnish the following information to
the Issuer, the Administrator, the Eligible Lender Trustee and the Indenture
Trustee, unless otherwise noted, at the specified times:
(a) The reports and data listed in Attachment C, at the times
indicated in the attachment;
(b) Within 30 days following the end of each calendar quarter,
to the Department, owner's request for interest and Special Allowance Payments
(ED 799);
(c) To credit bureaus selected by Servicer, credit bureau
reporting in accordance with the Higher Education Act;
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(d) At any time the Eligible Lender Trustee or the Indenture
Trustee, as the case may be, shall have reasonable grounds to believe that such
request would be necessary in connection with its performance of its duties
under related documents, and within five (5) Business Days of receipt of a
request therefor, the Servicer shall furnish to the Eligible Lender Trustee or
to the Indenture Trustee a list of all Trust Student Loans (by loan
identification number, type and outstanding principal balance) and any
additional information requested relating to the Trust Student Loans; and
(e) From time to time as may be reasonably requested, reports
and data providing additional information on the Trust Student Loans.
Section 3.11 Covenants and Agreements of the Issuer,
Administrator, Eligible Lender Trustee and Servicer. The Issuer, the
Administrator, the Servicer and the Eligible Lender Trustee each agree that:
A. Any payment and any communications received at any time by
the Issuer, Administrator and the Eligible Lender Trustee with respect to a
Trust Student Loan shall be immediately transmitted to the Servicer. Such
communications shall include, but not be limited to, requests or notices of loan
cancellation, notices of borrower disqualification, letters, changes in address
or status, notices of death or disability, notices of bankruptcy and forms
requesting deferment of repayment or forbearance.
B. The Servicer may change any part or all of its equipment,
data processing programs and any procedures and forms in connection with the
services performed hereunder so long as the Servicer continues to service the
Trust Student Loans in conformance with the requirements herein. The Servicer
shall not make any material change in its servicing system and operations with
respect to the Trust Student Loans without the prior written consent of the
Administrator, which consent will not be unreasonably withheld. Each written
request for consent by the Servicer shall be acted upon promptly by the
Administrator. Anything in this paragraph B to the contrary notwithstanding, the
Servicer will not be required to request the consent of the Administrator with
respect to any changes in the Servicer's servicing system and operations which
the Servicer reasonably determines are required due to changes in the Higher
Education Act or Guarantor program requirements.
C. The Eligible Lender Trustee will furnish the Servicer with
a copy of any and all Guarantee Agreements relating to the Trust Student Loans
serviced hereunder.
D. The Servicer may and, at the direction of the
Administrator, shall include marketing or informational material generally
provided to borrowers of loans owned by the Student Loan Marketing Association
with communications sent to a borrower.
E. The Servicer may, in its discretion, if requested by a
borrower of a Trust Student Loan, arrange for the sale of such Trust Student
Loan to another lender which holds another student loan of such borrower at a
price not less than the Purchase Amount.
F. The Servicer shall arrange for the sale of a Trust Student
Loan to the Student Loan Marketing Association upon receipt of notice from the
Student Loan Marketing
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Association that it has received an executed consolidation loan application from
the borrower of such Trust Student Loan. The sale price for such Trust Student
Loan shall equal the Purchase Amount.
Section 3.12 Special Programs. The Servicer shall offer
borrowers of the Trust Student Loans all special programs (e.g., Great
Returns(sm) and Direct Repay(sm)), whether or not in existence as of the date of
this Agreement, generally offered to the obligors of comparable loans owned by
SLM Corporation or any of its Affiliates and serviced by the Servicer; provided,
however, to the extent any such program is not required by the Higher Education
Act and effectively reduces borrower interest rate or principal balances on the
Trust Student Loans, such special program shall be applied to the Trust Student
Loans only if and to the extent the Issuer receives payment from the Student
Loan Marketing Association or the Administrator (and the Servicer receives
notice of such payment) in an amount sufficient to offset such effective yield
reductions. Each of the Student Loan Marketing Association and the Administrator
shall be deemed to be a third party beneficiary of this Section 3.12 and shall
make appropriate arrangements to compensate the Servicer for increased costs
associated with material changes to existing special programs or the
implementation and support of any new special programs.
Section 3.13 Financial Statements. The Servicer shall provide
to the Administrator at any time that the Servicer is not an Affiliate of the
Administrator (a) as soon as possible, and in no event more than 120 days after
the end of each fiscal year of the Servicer, audited financials as at the end of
and for such year and (b) as soon as possible, and in no event more than 30 days
after the end of each quarterly accounting period of the Servicer, unaudited
financials as at the end of and for such period.
Section 3.14 Insurance. The Servicer shall maintain or cause
to be maintained insurance with respect to its property and business against
such casualties and contingencies and of such types and in such amounts as is
customary in the case of institutions of the same type and size.
Section 3.15 Administration Agreement. The Servicer agrees to
perform all duties required of the Servicer under the Administration Agreement
using that degree of skill and attention that the Servicer exercises with
respect to its comparable business activities.
Section 3.16 Lender Identification Number. The Eligible Lender
Trustee may permit trusts, other than the Issuer, established by the Depositor
to securitize student loans, to use the Department lender identification number
applicable to the Issuer if the servicing agreements with respect to such other
trusts include provisions substantially similar to this paragraph. In such
event, the Servicer may claim and collect Interest Subsidy Payments and Special
Allowance Payments with respect to Trust Student Loans and student loans in such
other trusts using such common lender identification number. Notwithstanding
anything herein or in the Basic Documents to the contrary, any amounts assessed
against payments (including, but not limited to, Interest Subsidy Payments and
Special Allowance Payments) due from the Department to any such other trust
using such common lender identification number as a result of amounts owing to
the Department from the Issuer will be deemed for all purposes hereof and of the
Basic Documents (including for purposes of determining amounts paid by the
Department with respect to the student loans in the Trust and such other trust)
to have been assessed against the Issuer and
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shall be deducted by the Administrator or the Servicer and paid to such other
trust from any collections made by them which would otherwise have been payable
to the Collection Account for the Issuer. Any amounts assessed against payments
due from the Department to the Issuer as a result of amounts owing to the
Department from such other trust using such common lender identification number
will be deemed to have been assessed against such other trust and will be
deducted by the Administrator or the Servicer from any collections made by them
which would otherwise be payable to the collection account for such other trust
and paid to the Issuer.
ARTICLE IV
Section 4.01 Representations of Servicer. The Servicer makes
the following representations on which the Issuer is deemed to have relied in
acquiring (through the Eligible Lender Trustee) the Trust Student Loans and
appointing the Servicer as servicer hereunder. The representations speak as of
the execution and delivery of this Agreement and as of the Closing Date, but
shall survive the sale, transfer and assignment of the Trust Student Loans to
the Eligible Lender Trustee on behalf of the Issuer and the pledge thereof to
the Indenture Trustee pursuant to the Indenture.
A. Organization and Good Standing. The Servicer is duly
organized and validly existing as a limited partnership formed under the laws of
the State of Delaware and in good standing under the laws of the State of
Delaware, with the power and authority to own its properties and to conduct its
business as such properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, the power, authority and
legal right to service the Trust Student Loans and to hold the Trust Student
Loan Files as custodian.
B. Due Qualification. The Servicer is duly qualified to do
business and has obtained all necessary licenses and approvals in all
jurisdictions in which the ownership or lease of property or the conduct of its
business (including the servicing of the Trust Student Loans as required by this
Agreement) shall require such qualifications.
C. Power and Authority. The Servicer has the power and
authority to execute and deliver this Agreement and to carry out its terms; and
the execution, delivery and performance of this Agreement have been duly
authorized by the Servicer by all necessary action. No registration with or
approval of any governmental agency is required for the due execution and
delivery by, and enforceability against, the Servicer of this Agreement.
D. Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Servicer enforceable in accordance with its
terms subject to bankruptcy, insolvency and other similar laws affecting
creditors' rights generally and subject to equitable principles.
E. No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof will not
conflict with, result in any breach of any of the terms and provisions of, nor
constitute (with or without notice or lapse of time or both) a default under,
the limited partnership agreement of the Servicer, or any indenture, agreement
or other instrument to which the Servicer is a party or by which it shall be
bound; nor result in the creation or imposition of any Lien upon any of its
properties pursuant to the terms of
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any such indenture, agreement or other instrument (other than this Agreement and
the other Basic Documents); nor violate any law or, to the best of the
Servicer's knowledge, any order, rule or regulation applicable to the Servicer
of any court or of any Federal or state regulatory body, administrative agency
or other governmental instrumentality having jurisdiction over the Servicer or
its properties.
F. No Proceedings. There are no proceedings or investigations
pending, or, to the Servicer's best knowledge, threatened, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Servicer or its properties: (i) asserting the
invalidity of this Agreement or any of the other Basic Documents to which the
Servicer is a party, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Agreement or any of the other Basic Documents
to which the Servicer is a party, (iii) seeking any determination or ruling that
could reasonably be expected to have a material and adverse effect on the
performance by the Servicer of its obligations under, or the validity or
enforceability of, this Agreement or any of the other Basic Documents to which
the Servicer is a party, or (iv) relating to the Servicer and which might
adversely affect the Federal or state income tax attributes of the Notes.
Section 4.02 Indemnities of Servicer. The Servicer shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer under this Agreement.
The Servicer shall pay for any loss, liability or expense,
including reasonable attorneys' fees, that may be imposed on, incurred by or
asserted against the Issuer or the Eligible Lender Trustee by the Department
pursuant to the Higher Education Act, to the extent that such loss, liability or
expense arose out of, or was imposed upon the Issuer through, the negligence,
willful misfeasance or bad faith of the Servicer in the performance of its
obligations and duties under this Agreement or by reason of the reckless
disregard of its obligations and duties under this Agreement, where the final
determination that any such loss, liability or expense arose out of, or was
imposed upon the Issuer or the Eligible Lender Trustee through, any such
negligence, willful misfeasance, bad faith or recklessness on the part of the
Servicer is established by a court of law, by an arbitrator or by way of
settlement agreed to by the Servicer. Notwithstanding the foregoing, if the
Servicer is rendered unable, in whole or in part, by a force outside the control
of the parties hereto (including acts of God, acts of war, fires, earthquakes,
hurricanes, floods and other disasters) to satisfy its obligations under this
Agreement, the Servicer shall not be deemed to have breached any such obligation
upon delivery of written notice of such event to the other parties hereto, for
so long as the Servicer remains unable to perform such obligation as a result of
such event.
For purposes of this Section, in the event of the termination
of the rights and obligations of Xxxxxx Xxx Servicing L.P. (or any successor
thereto pursuant to Section 4.3) as Servicer pursuant to Section 5.1, or a
resignation by such Servicer pursuant to this Agreement, such Servicer shall be
deemed to be the Servicer pending appointment of a successor Servicer pursuant
to Section 5.2.
Liability of the Servicer under this Section shall survive the
resignation or removal of the Eligible Lender Trustee or the Indenture Trustee
or the termination of this
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Agreement. If the Servicer shall have made any payments pursuant to this Section
and the Person to or on behalf of whom such payments are made thereafter
collects any of such amounts from others, such Person shall promptly repay such
amounts to the Servicer, without interest.
Section 4.03 Merger or Consolidation of, or Assumption of the
Obligations of, Servicer. The Servicer hereby agrees that, upon (a) any merger
or consolidation of the Servicer into another Person, (b) any merger or
consolidation to which the Servicer shall be a party resulting in the creation
of another Person or (c) any Person succeeding to the properties and assets of
the Servicer substantially as a whole, the Servicer shall (i) cause such Person
(if other than the Servicer) to execute an agreement of assumption to perform
every obligation of the Servicer hereunder, (ii) deliver to the Eligible Lender
Trustee and Indenture Trustee an Officers' Certificate and an Opinion of Counsel
each stating that such consolidation, merger or succession and such agreement of
assumption comply with this Section and that all conditions precedent provided
for in this Agreement relating to such transaction have been complied with,
(iii) cause the Rating Agency Condition to have been satisfied with respect to
such transaction and (iv) cure any existing Servicer Default or any continuing
event which, after notice or lapse of time or both, would become a Servicer
Default. Upon compliance with the foregoing requirements, such Person shall be
the successor to the Servicer under this Agreement without further act on the
part of any of the parties to this Agreement.
Section 4.04 Limitation on Liability of Servicer. The Servicer
shall not be under any liability to the Issuer, the Noteholders, any Swap
Counterparty, the Administrator, the Eligible Lender Trustee or the Indenture
Trustee except as provided under this Agreement, for any action taken or for
refraining from the taking of any action pursuant to this Agreement, for errors
in judgment, for any incorrect or incomplete information provided by schools,
borrowers, Guarantors and the Department, for the failure of any party to this
Servicing Agreement or any other Basic Document to comply with its respective
obligations hereunder or under any other Basic Document or for any losses
attributable to the insolvency of any Guarantor; provided, however, that this
provision shall not protect the Servicer against its obligation to purchase
Student Loans from the Trust pursuant to Section 3.5 or to pay to the Trust
amounts required pursuant to Section 3.5 or against any liability that would
otherwise be imposed by reason of willful misfeasance, bad faith or negligence
in the performance of duties or by reason of reckless disregard of obligations
and duties under this Agreement. The Servicer may rely in good faith on any
document of any kind prima facie properly executed and submitted by any person
respecting any matters arising under this Agreement.
Except as provided in this Agreement, the Servicer shall not
be under any obligation to appear in, prosecute or defend any legal action where
it is not named as a party; provided, however, that the Servicer may undertake
any reasonable action that it may deem necessary or desirable in respect of this
Agreement and the other Basic Documents and the rights and duties of the parties
to this Agreement and the other Basic Documents and the interests of the
Noteholders. To the extent that the Servicer is required to appear in or is made
a defendant in any legal action or other proceeding relating to the servicing of
the Trust Student Loans, the Issuer shall indemnify and hold the Servicer
harmless from all cost, liability or expense of the Servicer not arising out of
or relating to the failure of the Servicer to comply with the terms of this
Agreement.
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Section 4.05 Xxxxxx Xxx Servicing L.P. Not to Resign as
Servicer. Subject to the provisions of Section 4.3, Xxxxxx Mae Servicing L.P.
shall not resign from the obligations and duties hereby imposed on it as
Servicer under this Agreement except upon determination that the performance of
its duties under this Agreement are no longer permissible under applicable law.
Notice of any such determination permitting the resignation of Xxxxxx Xxx
Servicing L.P. shall be communicated to the Eligible Lender Trustee and the
Indenture Trustee at the earliest practicable time (and, if such communication
is not in writing, shall be confirmed in writing at the earliest practicable
time) and any such determination shall be evidenced by an Opinion of Counsel to
such effect delivered to the Eligible Lender Trustee and the Indenture Trustee
concurrently with or promptly after such notice. No such resignation shall
become effective until the Indenture Trustee or a successor Servicer shall have
assumed the responsibilities and obligations of Xxxxxx Mae Servicing L.P. in
accordance with Section 5.2.
ARTICLE V
Section 5.01 Servicer Default. If any one of the following
events (a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer (i) to deliver to the
Indenture Trustee for deposit in the Trust Accounts any payment required by the
Basic Documents to which the Servicer is a signatory or (ii) in the event that
daily deposits into the Collection Account are not required, to deliver to the
Administrator any payment required by the Basic Documents, which failure in case
of either clause (i) or (ii) continues unremedied for five Business Days after
written notice of such failure is received by the Servicer from the Eligible
Lender Trustee, the Indenture Trustee or the Administrator or five Business Days
after discovery of such failure by an officer of the Servicer; or
(b) any failure by the Servicer duly to observe or to perform
in any material respect any other covenant or agreement of the Servicer set
forth in this Agreement or any other Basic Document to which the Servicer is a
signatory, which failure shall (i) materially and adversely affect the rights of
the Indenture Trustee, on behalf of the Noteholders and any Cross Currency Swap
Counterparty, or the Noteholders and (ii) continues unremedied for a period of
60 days after the date on which written notice of such failure, requiring the
same to be remedied, shall have been given (A) to the Servicer by the Indenture
Trustee, the Eligible Lender Trustee or the Administrator or (B) to the
Servicer, and to the Indenture Trustee and the Eligible Lender Trustee by the
Noteholders representing not less than 50% of the Outstanding Amount of the
Notes provided, however, any breach of Sections 3.1, 3.2, 3.3 or 3.4 shall not
be deemed a Servicer Default so long as the Servicer is in compliance with its
repurchase and reimbursement obligations under Section 3.5; or
(c) an Insolvency Event occurs with respect to the Servicer;
or
(d) any failure by the Servicer to comply with any
requirements under the Higher Education Act resulting in a loss of its
eligibility as a third-party servicer;
then, and in each and every case, so long as the Servicer Default shall not have
been remedied, either the Indenture Trustee, or the Noteholders of Notes
evidencing not less than 50% of the
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Outstanding Amount of the Notes, by notice then given in writing to the Servicer
(and to the Indenture Trustee and the Eligible Lender Trustee if given by the
Noteholders) may terminate all the rights and obligations (other than the
obligations set forth in Section 3.5 and Section 4.2) of the Servicer under this
Agreement. As of the effective date of termination of the Servicer, all
authority and power of the Servicer under this Agreement, whether with respect
to the Notes or the Trust Student Loans or otherwise, shall, without further
action, pass to and be vested in the Indenture Trustee or such successor
Servicer as may be appointed under Section 5.2. The predecessor Servicer shall
cooperate with the successor Servicer, the Indenture Trustee and the Eligible
Lender Trustee in effecting the termination of the responsibilities and rights
of the predecessor Servicer under this Agreement, including the transfer to the
successor Servicer for administration by it of all cash amounts that shall at
the time be held by the predecessor Servicer for deposit, or shall thereafter be
received by it with respect to a Trust Student Loan. All reasonable costs and
expenses (including attorneys' fees) incurred in connection with transferring
the Trust Student Loan Files to the successor Servicer and amending this
Agreement and any other Basic Documents to reflect such succession as Servicer
pursuant to this Section shall be paid by the predecessor Servicer (other than
the Indenture Trustee acting as the Servicer under this Section 5.1) upon
presentation of reasonable documentation of such costs and expenses. Upon
receipt of notice of the occurrence of a Servicer Default, the Eligible Lender
Trustee shall give notice thereof to the Rating Agencies.
Section 5.02 Appointment of Successor.
A. Upon receipt by the Servicer of notice of termination
pursuant to Section 5.1, or the resignation by the Servicer in accordance with
the terms of this Agreement, the predecessor Servicer shall continue to perform
its functions as Servicer under this Agreement, in the case of termination, only
until the date specified in such termination notice or, if no such date is
specified in a notice of termination, until receipt of such notice and, in the
case of resignation, until the Indenture Trustee or a successor Servicer shall
have assumed the responsibilities and duties of Xxxxxx Xxx Servicing L.P. In the
event of the termination hereunder of the Servicer, the Issuer shall appoint a
successor Servicer acceptable to the Indenture Trustee, and the successor
Servicer shall accept its appointment by a written assumption in form acceptable
to the Indenture Trustee. In the event that a successor Servicer has not been
appointed at the time when the predecessor Servicer has ceased to act as
Servicer in accordance with this Section, the Indenture Trustee without further
action shall automatically be appointed the successor Servicer and the Indenture
Trustee shall be entitled to the Servicing Fee and any Carryover Servicing Fees.
Notwithstanding the above, the Indenture Trustee shall, if it shall be unwilling
or legally unable so to act, appoint or petition a court of competent
jurisdiction to appoint any established institution whose regular business shall
include the servicing of student loans, as the successor to the Servicer under
this Agreement; provided, however, that such right to appoint or to petition for
the appointment of any such successor Servicer shall in no event relieve the
Indenture Trustee from any obligations otherwise imposed on it under the Basic
Documents until such successor has in fact assumed such appointment.
B. Upon appointment, the successor Servicer (including the
Indenture Trustee acting as successor Servicer) shall be the successor in all
respects to the predecessor Servicer and shall be subject to all the
responsibilities, duties and liabilities placed on the predecessor Servicer that
arise thereafter or are related thereto and shall be entitled to an amount
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agreed to by such successor Servicer (which shall not exceed the Servicing Fee
unless the Rating Agency Condition is satisfied with respect to such
compensation arrangements) and all the rights granted to the predecessor
Servicer by the terms and provisions of this Agreement.
C. The Servicer may not resign unless it is prohibited from
serving as such by law as evidenced by an Opinion of Counsel to such effect
delivered to the Indenture Trustee and the Eligible Lender Trustee.
Notwithstanding the foregoing or anything to the contrary herein or in the other
Basic Documents, the Indenture Trustee, to the extent it is acting as successor
Servicer pursuant hereto and thereto, shall be entitled to resign to the extent
a qualified successor Servicer has been appointed and has assumed all the
obligations of the Servicer in accordance with the terms of this Agreement and
the other Basic Documents.
Section 5.03 Notification to Noteholders. Upon any termination
of, or appointment of a successor to, the Servicer pursuant to this Article V,
the Indenture Trustee shall give prompt written notice thereof to Noteholders
and the Rating Agencies (which, in the case of any such appointment of a
successor, shall consist of prior written notice thereof to the Rating
Agencies).
Section 5.04 Waiver of Past Defaults. The Noteholders of Notes
evidencing a majority of the Outstanding Amount of the Notes may, on behalf of
all Noteholders, waive in writing any default by the Servicer in the performance
of its obligations hereunder and any consequences thereof, except a default in
making any required deposits to or payments from any of the Trust Accounts (or
giving instructions regarding the same) in accordance with this Agreement. Upon
any such waiver of a past default, such default shall cease to exist, and any
Servicer Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement and the Administration Agreement. No such waiver
shall extend to any subsequent or other default or impair any right consequent
thereto.
ARTICLE VI
Section 6.01 Amendment.
A. This Agreement may be amended by the Servicer, the Issuer,
the Administrator, the Eligible Lender Trustee and the Indenture Trustee,
without the consent of any of the Noteholders, to comply with any change in any
applicable federal or state law, to cure any ambiguity, to correct or supplement
any provisions in this Agreement or for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions in this
Agreement; provided, however, that such action shall not, as evidenced by an
Opinion of Counsel delivered to the Eligible Lender Trustee and the Indenture
Trustee, adversely affect in any material respect the interests of any
Noteholder.
B. This Agreement may also be amended from time to time by the
Servicer, the Issuer, the Administrator, the Eligible Lender Trustee and the
Indenture Trustee, with the consent of the Noteholders of Notes evidencing a
majority of the Outstanding Amount of the Notes, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of the Noteholders;
provided, however, that no such amendment shall (a) increase or reduce in any
manner the
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amount of, or accelerate or delay the timing of, collections of payments with
respect to Trust Student Loans or distributions that shall be required to be
made for the benefit of the Noteholders or (b) reduce the aforesaid percentage
of the Outstanding Amount of the Notes, the Noteholders of which are required to
consent to any such amendment, without the consent of all outstanding
Noteholders.
It shall not be necessary for the consent of Noteholders
pursuant to paragraph B to approve the particular form of any proposed amendment
or consent, but it shall be sufficient if such consent shall approve the
substance thereof.
Promptly after the execution of any amendment to this
Agreement (or, in the case of the Rating Agencies, fifteen days prior thereto),
the Eligible Lender Trustee shall furnish written notification of the substance
of such amendment to the Indenture Trustee and each of the Rating Agencies.
Prior to the execution of any amendment to this Agreement, the
Eligible Lender Trustee and the Indenture Trustee shall be entitled to receive
and rely upon an Opinion of Counsel stating that the execution of such amendment
is authorized or permitted by this Agreement. The Indenture Trustee may, but
shall not be obligated to, execute and deliver such amendment which affects its
rights, powers, duties or immunities hereunder.
Section 6.02 Notices. All notices hereunder shall be given by
United States certified or registered mail, by telegram or by other
telecommunication device capable of creating written record of such notice and
its receipt. Notices hereunder shall be effective when received and shall be
addressed to the respective parties hereto at the addresses set forth below, or
at such other address as shall be designated by any party hereto in a written
notice to each other party pursuant to this section.
If to the Servicer, to:
Xxxxxx Xxx Servicing L.P.
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Director of ABS Administration
If to the Issuer, to:
SLM Student Loan Trust 2003-12
c/o Chase Manhattan Bank USA, National Association
Christiana Center/OPS4
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Corporate Trust Dept.
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with a copy to:
JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Structured Finance Services
If to the Administrator, to:
Student Loan Marketing Association
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Director, Corporate Finance Operations
If to the Eligible Lender Trustee, to:
Chase Manhattan Bank USA, National Association
Christiana Center/OPS4
000 Xxxxxxx Xxxxxxxxxx Xxxx
Xxxxxx, Xxxxxxxx 00000
Attn: Corporate Trust Dept.
with a copy to:
JPMorgan Chase Bank
0 Xxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Structured Finance Services
If to the Indenture Trustee, to:
The Bank of New York
000 Xxxxxxx Xxxxxx, 0 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Corporate Trust - Structured Finance
with copies to:
The Bank of New York
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Corporate Trust - Structured Finance
Section 6.03 Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, and such
counterparts shall constitute one and the same instrument.
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Section 6.04 Entire Agreement; Severability. This Agreement
constitutes the entire agreement among the Issuer, the Administrator, the
Eligible Lender Trustee, the Indenture Trustee and Servicer. All prior
representations, statements, negotiations and undertakings with regard to the
subject matter hereof are superseded hereby.
If any term or provision of this Agreement or the application
thereof to any person or circumstance shall, to any extent, be invalid or
unenforceable, the remaining terms and provisions of this Agreement, or the
application of such terms or provisions to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this Agreement shall be valid and
enforced to the fullest extent permitted by law.
Section 6.05 Governing Law. The terms of this Agreement shall
be subject to all applicable provisions of the Higher Education Act and shall be
construed in accordance with and governed by the laws of the State of New York
without reference to its conflict of law provisions, and the obligations, rights
and remedies of the parties, hereunder shall be determined in accordance with
such laws.
Section 6.06 Relationship of Parties. Servicer is an
independent contractor and, except for the services which it agrees to perform
hereunder, the Servicer does not hold itself out as an agent of any other party
hereto. Nothing herein contained shall create or imply an agency relationship
among Servicer and any other party hereto, nor shall this Agreement be deemed to
constitute a joint venture or partnership between the parties.
Section 6.07 Captions. The captions used herein are for the
convenience of reference only and not part of this Agreement, and shall in no
way be deemed to define, limit, describe or modify the meanings of any provision
of this Agreement.
Section 6.08 Nonliability of Directors, Officers and Employees
of Servicer, the Eligible Lender Trustee, the Indenture Trustee and the
Administrator. No member of the board of directors or any officer, employee or
agent of Servicer, the Administrator, the Eligible Lender Trustee or the
Indenture Trustee (or any Affiliate of any such party) shall be personally
liable for any obligation incurred under this Agreement.
Section 6.09 Assignment. This Agreement may not be assigned by
the Servicer except as permitted under Sections 4.3, 4.5 and 5.2. This Agreement
may not be assigned by the Administrator except as permitted under Sections 4.3
and 4.6 of the Administration Agreement.
Section 6.10 Limitation of Liability of Eligible Lender
Trustee and Indenture Trustee.
A. Notwithstanding anything contained herein to the contrary,
this Agreement has been signed by Chase Manhattan Bank USA, National
Association, not in its individual capacity but solely in its capacity as
Eligible Lender Trustee of the Issuer and in no event shall Chase Manhattan Bank
USA, National Association in its individual capacity or, except as expressly
provided in the Trust Agreement, as Eligible Lender Trustee have any liability
for the representations, warranties, covenants, agreements or other obligations
of the Issuer or the Eligible Lender Trustee hereunder or in any of the
certificates, notices or
-20-
agreements delivered pursuant hereto as to all of which recourse shall be had
solely to the assets of the Issuer.
B. Notwithstanding anything contained herein to the contrary,
this Agreement has been signed by The Bank of New York, not in its individual
capacity but solely as Indenture Trustee, and in no event shall The Bank of New
York have any liability for the representations, warranties, covenants,
agreements or other obligations of the Issuer hereunder or in any of the
certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer.
-21-
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed on their behalf by their duly authorized officers
as of November 25, 2003.
XXXXXX XXX SERVICING L.P.
By: XXXXXX MAE, INC.
Its general partner
By: /s/ XXXXX X. XXXXXX
Name: Xxxxx X. Xxxxxx
Title: Vice President, Accounting
STUDENT LOAN MARKETING
ASSOCIATION,
as Administrator
By: /s/ J. XXXXX XXXXXX
Name: J. Xxxxx Xxxxxx
Title: Authorized Agent
SLM STUDENT LOAN TRUST 2003-12
By: CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION, not in its
individual capacity but solely as Eligible Lender
Trustee under an Amended and Restated Trust
Agreement, dated as of November 25, 2003,
among SLM Funding LLC, Chase Manhattan
Bank USA, National Association, in its capacity
as Eligible Lender Trustee and The Bank of
New York, in its capacity as Indenture Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
THE BANK OF NEW YORK, not in its
individual capacity but solely as Indenture
Trustee under an Indenture, dated as of
November 1, 2003, among SLM Student Loan
Trust 2003-12, Chase Manhattan Bank, USA,
National Association, not in its individual
capacity but solely as the Eligible Lender
Trustee, and The Bank of New York, in its
capacity as Indenture Trustee
By: /s/ XXXX X. XXXXXXX
Name: Xxxx X. Xxxxxxx
Title: Agent
ATTACHMENT A
SCHEDULE OF FEES
The Servicer will receive a Primary Servicing Fee and a
Carryover Servicing Fee (together, the "Servicing Fee"). The "Primary Servicing
Fee" for any month is an amount equal to the sum of 1/12th of 0.50% of the
outstanding principal amount of the Trust Student Loans as of the last day of
the preceding calendar month, plus any such amounts from prior Monthly Servicing
Payment Dates that remain unpaid. The Primary Servicing Fee will be payable out
of Available Funds and amounts on deposit in the Reserve Account on the 15th day
of each month (or, if any such date is not a Business Day, on the next
succeeding Business Day), commencing on December 15, 2003 (each, a "Monthly
Servicing Payment Date"). The "Carryover Servicing Fee" will be payable out of
Available Funds in accordance with Section 2.8(l) of the Administrative
Agreement on each Distribution Date and is the sum of (a) the amount of certain
increases in the costs incurred by the Servicer which are agreed to pursuant to
Section 3.8 of the Servicing Agreement, (b) any Conversion Fees, Transfer Fees
and Removal Fees (as defined below) incurred since the last Distribution Date
and (c) any amounts described in (a) and (b) above that remain unpaid from prior
Distribution Dates plus interest on such amounts for the period from the
Distribution Date on which such amounts become due to the date such amounts are
paid in full at a rate per annum for each Interest Period (as defined below)
equal to the sum of (a) the average accepted auction price (expressed on a bond
equivalent basis) for 91-day Treasury Bills sold at the most recent 91-day
Treasury Xxxx auction prior to the Interest Period as reported by the U.S.
Treasury Department and (b) 2.00%.
"Interest Period" shall mean the period from each Distribution
Date through the day before the next Distribution Date. The Carryover Servicing
Fee will be payable to the Servicer on each succeeding Distribution Date out of
Available Funds after payment on such Distribution Date of all senior amounts
payable prior to clause (l) of Section 2.8 of the Administration Agreement. On
the December 2003 Monthly Servicing Payment Date, the Servicer shall receive a
pro rata portion of the Primary Servicing Fee for the number of days in the
month of November since the Closing Date.
Servicer will be paid a fee ("Conversion Fee") for any Student
Loan added to the Trust Estate which Student Loan is not serviced on the
Servicer's system unless such Student Loan is being substituted into the Trust
Estate by the Servicer pursuant to Section 3.5 of this Agreement. The Conversion
Fee is equal to the greater of $17.00 per account or the Servicer's verifiable
costs plus 15%.
Servicer will be paid a fee ("Transfer Fee") for any Student
Loan transferred in or out of the Trust Estate which is at the time of transfer
being serviced on the Servicer's system (regardless of the owner) unless such
Student Loans are being removed or added to the Trust in order to comply with
the Servicer's purchase/substitution obligation under Section 3.5 of this
Agreement. The Transfer Fee is equal to $4.00 per account transaction.
Servicer will be paid a fee ("Removal Fee") for performing all
activities required to remove a Trust Student Loan from the Servicer's system to
another servicer unless such Trust
A-1
Student Loan is being removed due to the termination of the Servicer pursuant to
Section 5.1 of this Agreement. The Removal Fee is equal to $10.00 per account
plus any verifiable direct expenses incurred for shipping such Trust Student
Loan to the new servicer.
A-2
ATTACHMENT B
Loan Servicing Center/Florida
X.X. Xxx 0000
Xxxxxx Xxxx, Xxxxxxx 00000-0000
(000) 000-0000
Loan Servicing Center/Indianapolis
00000 XXX Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
(000) 000-0000
Loan Servicing Center/Pennsylvania
000 Xxxxxx Xxxxxx
Xxxxxxx Xxxxxxxxxx Xxxxxxx
Xxxxxx-Xxxxx, Xxxxxxxxxxxx 00000
(000) 000-0000
Loan Servicing Center/Texas
000 Xxxx Xxxxx Xxxxx
Xxxxxxx, Xxxxx 00000
(000) 000-0000
Western Regional Center (Nevada)
00000 X. Xxxxxxxxxx Xxxx.
Xxx Xxxxx, Xxxxxx 00000
(000) 000-0000
B-1
ATTACHMENT C
REPORTS
1. CLASS Report 800 - Monthly activity summary report
2. CLASS Report 801 - Monthly average/ending balance report
3. CLASS Report 802 - Monthly activity detail
4. CLASS Report 803 - Monthly conversion/removal summary
5. CLASS Report 807 - Monthly delinquency aging report
6. CLASS Report 810 - Monthly characteristics summary
7. CLASS Report 866 - Monthly average/ending balance offset fee report
8. CLASS Report 882 - Great Rewards/Direct Repay Report
9. Monthly Cash Reconciliation Report
10. Quarterly ED799 billing (prepared from CLASS Reports 824, 825, 827, 828
and 829; supporting detail CLASS Reports 865, 868, 870 and 871; and the
OE799 SAS library)
11. Portfolio Characteristics, Financial Activity, Quarterly calculation of
Accrued Interest to be capitalized, Delinquency Detail and Claims
extracts.
C-1
