EXHIBIT 10.2(a)
STUDENT LOAN FINANCE CORPORATION
STUDENT LOAN PURCHASE PROGRAM
STUDENT LOAN PURCHASE AGREEMENT
This Agreement made and entered into as of this [ , ] by and between
EDUCATION LOANS INCORPORATED, (hereinafter referred to as the "Corporation"),
and ________________________________________________________ a
____________________________________ organized and existing under the laws of
______________________________________________________and having the principal
office at _________________________________ in the ___________ of
______________________________________________ County of
________________________________, State of ________________________ (hereinafter
referred to as the "Lender").
WITNESSETH:
WHEREAS, pursuant to the Student Loan Purchase Program of Student Loan
Finance Corporation ("SLFC") the Corporation desires to cause the purchase from
the Lender of certain loans made pursuant to the Higher Education Act and the
Lender desires to originate such loans and to sell such loans to the
Corporation's Trustee (as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties agree as follows:
1. Definitions.
In this Agreement, the following terms shall have the following respective
meanings unless the context clearly requires otherwise:
"Eligible Loan" shall mean a Student Loan to an Eligible Borrower which:
(1) is an "eligible loan" as defined in Section 438 of the Higher Education Act
for purposes of receiving Special Allowance Payments; (2) is either Insured or
Guaranteed; and (3) bears interest at a rate per annum not less than or in
excess of the applicable rate of interest provided by the Higher Education Act
except as otherwise approved in writing by the Corporation with respect to a
lower rate.
"Indenture" shall mean the Indenture of Trust, dated as of [ , ], between
the Corporation and U.S. Bank National Association, Minneapolis, Minnesota, or
if the rights of U.S. Bank National Association, Minneapolis, Minnesota,
hereunder are assigned to a subsequent Trustee, the Indenture of Trust under
which such subsequent Trustee exercises its authority.
"Servicer" shall mean SLFC, as servicer of the Eligible Loans to be
purchased pursuant to this Agreement, and any successor thereto in such capacity
as designated in writing by the Corporation.
"Trustee" means any trustee under an indenture of trust pursuant to which
Obligations are issued by the Corporation, the proceeds of which are used to
purchase loans hereunder, including U.S. Bank National Association, Minneapolis,
Minnesota, or any successor or assignee of such entity.
All capitalized terms used in this Agreement and not otherwise defined
herein, shall have the meaning set forth in Exhibit "A" hereto. The term
"Agreement" shall include Exhibits "A" through "G" attached hereto.
2. Commitment and Purchase.
A. Subject to the terms and conditions and in reliance on the
representations, warranties and agreements set forth in this Agreement, the
Lender agrees to sell to the Trustee on behalf of the Corporation, and the
Corporation agrees to cause the Trustee to buy from the Lender, Eligible
Loans the Lender may choose to sell from time to time. The Eligible Loans
sold to the Trustee on behalf of the Corporation pursuant to this Agreement
shall be Eligible Loans made pursuant to the Higher Education Act, unless
the Servicer on behalf of the Corporation agrees to accept other Eligible
Loans hereunder.
B. Anything herein to the contrary notwithstanding, the Trustee on
behalf of the Corporation is not obligated to purchase and the corporation
is not obligated to cause the purchase of Eligible Loans from the Lender
(i)unless the gross rate of return on such Eligible Loans to the Trustee on
behalf of the Corporation or any subsequent holder would be at least equal
to the gross rate of return on loans Guaranteed under the Higher Education
Act, as currently in effect on date of execution and delivery of this
agreement, or (ii) if such eligible loans are loans for which the first
disbursement is made on or after July 1, 1988 in either case except as
otherwise approved in writing by the Corporation with respect to a lower
rate.
C. The delivery of, and payment for, the Eligible Loans shall take
place at the Servicer's offices on a date or dates not later than 12 months
after the date of delivery of the [_________], to be specified by the
Servicer by not less than fifteen days' prior written notice (the "Loan
Purchase Date").
D. The Corporation agrees to cause the Trustee to purchase the
Eligible Loans at a price equal to 100% of the outstanding unpaid principal
amount thereof on the Loan Purchase Date, plus accrued borrower interest;
provided, however, that such purchase price shall be reduced by the amount
of any accrued rebate or other obligations to the Secretary of Education or
the borrower under the Higher Education Act with respect to such Eligible
Loans which are not otherwise provided for in this Paragraph 2.D. Following
any Loan Purchase Date, the parties agree to adjust the purchase price
based on the actual payments required to be made, to the extent the amount
of such payments was not known as of the Loan Purchase Date. The Lender
shall be responsible for reporting to the Department of Education and
offsetting against interest subsidy payments and Special Allowance Payments
made to the Lender by the Secretary of Education or otherwise paying to the
Secretary of Education the entire amount of (1) any lender origination fee
which is required under the Higher Education Act, (2) any borrower
origination fees authorized to be charged by the Higher Education Act, and
(3) any other amounts due the Secretary of Education which are offset
against interest subsidy and special allowance payments pursuant to the
Higher Education Act .
E. Transfer of the Eligible Loans shall be by the means specified in
this Agreement.
F. Each Financed Eligible Loan shall have physically stamped thereon a
notice in the form set forth in Exhibit "C".
3. Representations, Warranties, Covenants and Agreements of the Lender. The
Lender hereby makes, and shall be deemed to again make as of each Loan Purchase
Date, each representation, warranty, covenant and agreement set forth in Exhibit
"D".
4. Survival of Representations and Warranties. Each representation,
warranty, certification and agreement contained in this Agreement shall survive
the Loan Purchase Date.
5. Conditions of Purchase.
The Corporation's obligation to cause the Trustee to purchase and pay for
the Eligible Loans to be Financed hereunder shall be subject to the following
conditions precedent:
A. All representations, warranties and statements by or on behalf of
the Lender contained in this Agreement shall be true on the Loan Purchase
Date.
B. Any notification to or approval by the Secretary of Education or a
Guarantor required by the Higher Education Act or a Guarantee Agreement as
a condition to the assignment of the Eligible Loans to be Financed shall
have been made or received and evidence thereof delivered to both the
Servicer and the Trustee.
C. The entire interest of the Lender in each Eligible Loan to be
Financed shall have been duly assigned by endorsement in the form set forth
in Exhibit "C", such endorsement to be without recourse except as provided
in paragraph 8.
D. Physical custody and possession to the Financed Eligible Loans
(including all information and documentation which is described in Exhibit
"B") shall be transferred in the manner directed by the Servicer.
E. The Servicer shall receive an opinion of Lender's counsel, dated as
of the date of this Agreement in substantially the form set forth in
Exhibit "G". The Servicer shall receive a Lender's Closing Certificate,
substantially in the form of Exhibit "B", when requested by the
Corporation.
F. If the promissory note evidences more than one loan all loans
covered thereby must be assigned hereunder and must qualify as Eligible
Loans.
6. Purchase Conditional.
The Corporation's obligation to cause the Trustee to purchase Eligible
Loans pursuant to this Agreement is subject to availability of funds therefor
under the Indenture.
7. Rejection of Loans.
A. If (i) the Lender is unable to make or furnish the representations
and warranties required to be made or furnished by it pursuant to this
Agreement as to a loan, or (ii) if the Lender is unable to fulfill one or
more covenants or conditions of this Agreement as to a loan, or (iii) if
the Servicer in its reasonable judgment deems that a loan does not comply
with the terms and conditions of this Agreement or is not being delivered
in compliance with such terms and conditions, or (iv) the Servicer in its
reasonable judgment deems that a loan in repayment is for any reason
unacceptable to it, then the Servicer may, in its sole discretion, refuse
to accept and cause the Trustee to pay for such loan (or any substitute
loan offered by the Lender in lieu thereof).
B. If the Servicer rejects a loan, any such loan shall be returned to
the Lender by registered mail (for repurchase pursuant to paragraph 8 if
theretofore purchased by the Trustee on behalf of the Corporation) together
with a letter identifying each returned loan and stating the basis for its
return. Any such loan returned to the Lender which has been endorsed to the
Trustee shall be endorsed by the Trustee to the Lender in the form set
forth in Exhibit "E".
The liability of the Corporation, the Servicer and the Trustee in
connection with the loss of or damage to any loans to be returned to the Lender
hereunder shall be limited to such loss or damage occurring as a result of their
negligence or willful misconduct in handling or safekeeping such loans.
C. If the Servicer rejects a loan, the Lender may substitute a
different Eligible Loan for the rejected loan, provided, however, that the
terms and conditions of such Eligible Loan are acceptable to the Servicer.
D. If at the Loan Purchase Date any Eligible Loan to be Financed is
more than 37 days delinquent with respect to any payment of principal or
interest, the Servicer may elect to cause the Trustee to purchase such
Eligible Loan and allow the Lender 15 days from the Loan Purchase Date
within which to cause such delinquency to be cured. If the delinquency
cannot be so cured, such Financed Eligible Loan shall be subject to
repurchase pursuant to Paragraph 8.
8. Repurchase Obligation.
If:
(i) any representation or warranty made or furnished by the Lender in
or pursuant to this Agreement shall prove to have been materially
incorrect;
(ii) the Secretary of Education or a Guarantor, as the case may be,
refuses to honor all or part of a claim filed with respect to a loan sold
to the Trustee on behalf of the Corporation pursuant to this Agreement
(including any claim for Special Allowance Payments, interest subsidy
payments, reinsurance and guarantee payments) on account of any
circumstances or event that occurred prior to the sale of such loan to the
Trustee on behalf of the Corporation
(iii) on account of any circumstances or event that occurred prior to
the sale of a loan to the Trustee on behalf of the Corporation pursuant to
this Agreement, a defense is asserted by a maker (or endorser, if any) of
such loan with respect to his obligation to pay all or any part of such
loan and the Servicer in good faith believes that the facts reported, if
true, raise a reasonable doubt as to the legal enforceability of such loan;
or
(iv) a Finance Student Loan is required to be repurchases pursuant to
paragraphs 7.B or 7.D,;
then the Lender shall repurchase such loan upon the Servicer's or Trustee's
request by paying to the Trustee, for the account of the Corporation, the then
outstanding principal balance of such loan (or such greater amount as may be
necessary to make the Corporation and the Trustee whole in light of the purchase
price originally paid by the Trustee for such loan), plus interest and Special
Allowance Payments accrued and unpaid with respect to such loan from the Loan
Purchase Date to and including the date of repurchase, plus any attorneys' fees,
legal expenses, court costs, servicing fees or other expenses incurred by the
Corporation, the Servicer and the Trustee in connection with such loan.
9. Notification to Borrowers.
The Lender and the Corporation agree that the Servicer and the Lender shall
either jointly or separately notify each borrower under the Financed Eligible
Loans of the assignment and transfer to the Trustee (but for the account and on
behalf of the Corporation) of the Lender's interest in such Financed Eligible
Loans and direct each borrower to make all payments thereon directly to the
Servicer until otherwise notified by the Trustee. Such notice shall be in
compliance with Section 428(b)(2)(F) of the Higher Education Act.
10. Obligations to Forward Payments and Communications.
A. The Lender shall promptly remit, or cause to be remitted, to the
Trustee as the Servicer may direct, all funds received by the Lender after
the Loan Purchase Date which constitute payments of principal, or interest
or Special Allowance Payments accrued after the Loan Purchase Date with
respect to any Financed Eligible Loan.
B. The Lender shall immediately transmit to the Servicer any
communication received by the Lender after the Loan Purchase Date with
respect to a Financed Eligible Loan or the borrower under such a Financed
Eligible Loan. Such communication shall include, but not be limited to,
letters, notices of death or disability, adjudications of bankruptcy and
similar documents, and forms requesting deferment of repayment or loan
cancellations.
11. Payment of Expenses and Taxes.
Except as specifically provided herein, each party to this Agreement shall
pay its own expenses incurred in connection with the preparation, execution and
delivery of this Agreement and the transactions herein contemplated, including,
but not limited to, the fees and disbursements of counsel, provided, however,
that the Lender shall pay any transfer or other taxes and recording or filing
fees payable in connection with the sale and purchase of the Eligible Loans to
be Financed.
12. lndemnification.
The Lender specifically acknowledges that the Corporation will be making
representations and warranties regarding the Eligible Loans to be Financed as
part of the proposed public offering of Obligations of the Corporation
(including without limitation Obligations to be issued under the Indenture)
based in part on the accuracy of the Lender's representations and warranties in
this Agreement. The Lender agrees to indemnify and save the Trustee and the
Corporation, the nonprofit corporation formerly known as Student Loan Finance
Corporation and the underwriters or dealers for said obligations harmless of,
from and against any and all loss, cost, damage or expense, including reasonable
attorneys' fees, incurred by reason of any breach of the Lender's warranties or
representations hereunder or any false or misleading representations of the
Lender or any failure to disclose any matter which makes the warranties and
representations herein misleading or any inaccuracy in any information furnished
by the Lender in connection herewith.
13. Other Provisions.
A. The Lender shall furnish to the Servicer such additional
information concerning the Lender's student loan portfolio as the Servicer
may reasonably request.
B. The Lender shall, at its expense, execute all other documents and
take all other steps as may be requested by the Servicer or the Trustee
from time to time to effect the sale hereunder of the Eligible Loans to be
purchased by the Trustee on behalf of the Corporation.
C. The provisions of this Agreement cannot be waived or modified
unless such waiver or modification be in writing and signed by the parties
hereto and the Trustee. Inaction or failure to demand strict performance
shall not be deemed a waiver.
D. This Agreement shall be governed by the laws of the State.
E. All covenants and agreements herein contained shall extend to and
be obligatory upon all successors of the respective parties hereto.
F. This Agreement may be simultaneously executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
G. If any provisions of this Agreement shall be held, or deemed to be
or shall, in fact, be inoperative or unenforceable as applied in any
particular situation, such circumstance shall not have the effect of
rendering the provision in question inoperative or unenforceable in any
other situation, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to any extent whatsoever.
The invalidity of any one or more phrases, sentences, clauses or paragraphs
herein contained shall not affect the remaining portions of this Agreement
or any part hereof.
H. All notices, requests, demands or other instruments which may or
are required to be given by either party to the other or to the Trustee or
the Servicer, shall be in writing and each shall be deemed to have been
properly given when served personally on an officer of the party to whom
such notice is to be given, or upon expiration of a period of 48 hours from
and after the postmark thereof when mailed postage prepaid by registered or
certified mail, requesting return receipt, addressed as follows:
If intended for the Corporation or the Servicer:
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
If intended for the Lender:
If intended for the Trustee:
U.S. Bank National Association.
Post Office Box 1308
141 North Main Avenue
Sioux Falls, South Dakota 57117-1308]
Either party, the Servicer or the Trustee may change the address and name
of the addressee to which subsequent notices are to be sent to it, by notice to
the others given as aforesaid, but any such notice of change, if sent by mail,
shall not be effective until the fifth day after it is mailed.
I. This Agreement may not be terminated by either party hereto except
in the manner and with the effect herein specifically provided for.
J. Time is of the essence is this Agreement.
K. This Agreement shall not be assignable by the Lender, in whole or
in part, without the prior written consent of the Corporation and the
Trustee.
L. No remedy by the terms of this Agreement conferred upon or reserved
to the Trustee or the Corporation is intended to be exclusive of any other
remedy, but each and every such remedy shall be cumulative and in addition
to every other remedy given under this Agreement or existing at law or in
equity (including, without limitation, the right to such equitable relief
by way of injunction), or by statute on or after the date of this
Agreement.
M. This Agreement has been made and entered into not only for the
benefit of the Lender and the Corporation but also for the benefit of the
Trustee and all holders of Obligations issued for the purpose of Financing
Eligible Loans and any other assignee of loans purchased hereunder
(including any trustee for holders of bonds, notes or other evidences of
indebtedness issued by the Corporation to refinance such loans), and its
provisions may be enforced not only by the parties to this Agreement but
also by the Trustee or such other assignee.
14. Non-Petition Covenant.
The Lender, by entering into this Agreement, covenants and agrees that it
shall not at any time petition or otherwise invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Corporation under any federal or state bankruptcy, insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Corporation or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Corporation, in connection with any obligation relating to this Agreement.
IN WITNESS WHEREOF, The parties have hereunto set their hands and seals as
of the day and year first above written.
EDUCATION LOANS INCORPORATED
____________________________
Name of Lender
By__________________________ By__________________________
Title:__________________ Title:___________________
ATTEST:
____________________________
Title:___________________
(Seal)
Exhibit "A" to Student Loan Purchase Agreement
DEFINITIONS
1.00 Terms
1.01 "Certificate of Insurance" shall mean a certificate of federal loan
insurance issued with respect to an Insured Eligible Loan by the Secretary of
Education pursuant to the provisions of the Higher Education Act.
1.02 "Eligible Borrower" shall mean a borrower who is eligible under the
Higher Education Act to be the obligor of a loan for financing a program of
post-secondary education for an Eligible Student as described in Sections 1.32.
1.03 "Federal Reimbursement Contract" means an agreement between a
Guarantor and the Secretary of Education providing for the payment by the
Secretary of Education of amounts authorized to be paid pursuant to the Higher
Education Act, including reimbursement amounts paid or payable upon defaulted
Financed Eligible Loans and other student loans guaranteed or insured by the
Guarantor and providing for interest subsidy payments to holders of qualifying
student loans guaranteed or insured by the Guarantor.
1.04 "Financed" in the case of Eligible Loans and Student Loans generally,
shall mean those acquired by the Trustee on behalf of the Corporation with
moneys derived from any of the funds or accounts established by the Indenture;
and where the context so permits or requires such usage, shall mean those
specific Eligible Loans so acquired by the Trustee on behalf of the Corporation
from the Lender pursuant to this Agreement t, inclusive of the promissory notes
evidencing such Eligible Loans or Student Loans and the related documentation in
connection with each thereof.
1.05 "Guarantee" or "Guaranteed" shall mean, with respect to a Student
Loan, the insurance or guarantee by a Guarantor, to the extent provided in the
Higher Education Act, of the principal of and accrued interest on such Student
Loan and the coverage of such Student Loan by (1) the Federal Reimbursement
Contracts providing, among other things, for reimbursement by the Secretary of
Education to such Guarantor for losses incurred by it on defaulted Financed
Eligible Loans insured or guaranteed by such Guarantor to the extent provided in
the Higher Education Act and (2) any guarantee fund established by the
Guarantor, prior to the termination of such guarantee fund.
1.06 "Guarantee Agreement" means an agreement between a Guarantor and
either the Trustee or the Lender providing for the insurance or guarantee by
such Guarantor, to the extent provided in the Higher Education Act, of the
principal of and accrued interest on loans to Eligible Borrowers made or
acquired by the Corporation or the Lender from time to time.
1.07 "Guarantee Program" means a Guarantor's loan insurance program
pursuant to which such Guarantor guarantees or insures loans to Eligible
Borrowers.
1.08 "Guaranteed Loans" means loans that are Guaranteed.
1.09 "Guarantor" shall mean Education Assistance Corporation, Great Lakes
Higher Education Corporation, Northstar Guarantee, Inc., Pennsylvania Higher
Education Assistance Agency, United Student Aid Funds, Inc., Student Loans of
North Dakota, Education Credit Management Corporation, Iowa College Student Aid
Commission, California Student Aid Commission, Missouri Coordinating Board for
Higher Education, or other guarantor permitted under the Indenture; provided,
however, that any such Guarantor must be a permitted guarantor under the
Indenture as of the Loan Purchase Date.
1.10 "Higher Education Act" shall mean the Higher Education Act of 1965, as
amended or supplemented from time to time, and all regulations promulgated
thereunder.
1.11 "Insurance" or "Insured" or "Insuring" means, with respect to a loan
to an Eligible Borrower the insuring by the Secretary of Education (as evidenced
by a Certificate of Insurance or other document or certification issued under
the provisions of the Higher Education Act) under the Higher Education Act, of
100% of the principal of and accrued interest on such loan.
1.12 "Insured Loans" means loans which are Insured.
1.13 "Lender" shall mean any "eligible lender", as defined in the Higher
Education Act and the Loan Purchase Regulations, permitted to participate as a
seller of Student Loans to the Corporation under the Program and which has
received an eligible lender designation from the Secretary of Education with
respect to Insured Loans or from the applicable Guarantor with respect to
Guaranteed Loans.
1.14 "Loan Purchase Date" has the meaning assigned thereto in Section 2.C.
of this Agreement.
1.15 "Obligations" shall mean all notes, bonds or other obligations of the
Corporation issued pursuant to the applicable indenture to finance or refinance
the purchase of student loans or for other purposes authorized by the applicable
Indenture.
1.16 "Program" shall mean the SLFC's Eligible Loan acquisition program with
respect to Financed Eligible Loans under which the Corporation will cause the
Trustee to acquire Eligible Loans from Lenders in order to increase the supply
of moneys available for new loans to assist students in obtaining a
post-secondary education.
1.17 "Secretary of Education" shall mean the Commissioner of Education,
Department of Health, Education and Welfare of the United States, and the
Secretary of the United States Department of Education (who succeeded to the
functions of the Commissioner of Education pursuant to the Department of
Education Organization Act), or any other officer, board, body, commission or
agency succeeding to the functions thereof under the Higher Education Act.
1.18 "Servicing Agreement" means a separate agreement between the
Corporation and a Servicer under which such Servicer agrees to act as the
Corporation's agent in administering and collecting Financed Student Loans.
1.19 "Special Allowance Payments" shall mean special allowance payments
authorized to be made by the Secretary of Education pursuant to Section 438 of
the Higher Education Act, or similar allowances authorized from time to time by
federal law or regulation.
1.20 "Student Loan Purchase Agreement" or Loan Purchase Contract" means an
agreement between the Corporation and a lender providing for the sale by the
lender to the Trustee on behalf of the Corporation of Eligible Loans within the
time specified in such agreement.
1.21 "State" shall mean the State of South Dakota.
1.22 "Student Loans" shall mean loans to Borrowers for post-secondary
education.
1.23 "Trustee" shall mean the entity serving as trustee under the
Indenture.
1.30 Eligible Students
1.31 An Eligible Student is any student who
(a) is accepted for enrollment or is enrolled at least half-time at an
Eligible Institution and is in good standing and making satisfactory
progress in a prescribed course of study; and,
(b) is a U.S. citizen or permanent resident, except that aliens, even
with immigrant or permanent resident status, are not Eligible Students if
enrolled in institutions located abroad; and,
(c) does not, at the time of application for the loan, owe a refund on
a federally funded grant awarded by the institution, and has never
defaulted, and is not then in default on a national direct or guaranteed
loan.
1.32 A prescribed course of study shall be and include an academic workload
sufficient to secure a degree or certificate in the period normally taken
therefor as determined by the institution and approved by the Servicer;
provided, however, that in no event shall such approval be given for a workload
of less than one-half the normal requirement.
1.40 Eligible Institutions
1.41 Eligible lnstitutions shall mean those institutions which satisfy the
definition of an "eligible educational institution" under the Higher Education
Act and the regulations of the applicable Guarantor. In all cases, a basic
requirement is approval by the Secretary of Education as an eligible institution
under the Higher Education Act and approval by the Secretary of Education for
civil rights compliance.
Exhibit "B" to Student Loan Purchase Agreement
LENDER'S CLOSING CERTIFICATE
______________________________ (the "Lender") does hereby certify that all
representations, warranties and statements by or on behalf of the undersigned
contained in a certain Student Loan Purchase Agreement by and between the Lender
and Education Loans Incorporated dated as of [ , ], (the "Agreement"), are
true and correct on and as of the date hereof, without exception or
qualification whatsoever;
FURTHERMORE, the Lender does hereby certify that the following documents,
where applicable to each Eligible Loan Financed under the Agreement, have
heretofore been furnished to the Corporation pursuant to paragraph 5.D. of the
Agreement:
Department of Education or Guarantor application, as supplemented
Interim note(s), if applicable Payout note(s), if applicable Evidence
of disbursement Disclosure statement
Certificate of Insurance and contract of insurance (or a certified copy
thereof) with respect to each Insured Loan or notification of loan
approval by Guarantor, with respect to each Guaranteed Loan (or a
certified copy thereof)
Guarantee Agreement and Agreement for Participation in the Guaranteed
Loan Program (or a certified copy thereof) with respect to each
Guaranteed Loan
Any other documentation held by the Lender relating to the history of
such Eligible Loan
Secretary of Education or Guarantor Loan Transfer Statement
Uniform Commercial Code financing statement, if any, securing any
interest in an Eligible Loan to be Financed, and an executed
termination statement related thereto
FURTHERMORE, the Lender does hereby certify that it has in its possession
evidence of loan disbursement for each Eligible Loan, and does hereby warrant
that it will maintain such evidence throughout the term of each such Eligible
Loan and will provide a copy thereof to the Servicer and the Trustee upon
request.
IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed and delivered by its officers thereunto duly authorized this
______________, day of __________________ 19____.
______________________________
Name of Lender
By____________________________
Title:___________________
ATTEST:
__________________________________
Title:____________________________
(Seal)
Exhibit "C" to Student Loan Purchase Agreement
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to U.S. Bank National
Association, Minneapolis, Minnesota as trustee (the "Trustee") under the
Indenture of Trust, dated as of [ , ], by and between Education Loans
Incorporated and the Trustee (but for the account and on behalf of Education
Loans Incorporated), without recourse except as provided in paragraph 8 of the
Student Loan Purchase Agreement dated as of [ , ] between Education Loans
Incorporated and _________________________________.
________________________________________ ___________________________________
Title and Signature of Name of Transferor
Trustee Officer
________________________________________ ___________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, 19____"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement between Education Loans Incorporated, and
U.S. Bank National Association, Minneapolis, Minnesota, as Trustee, and
Financing Statements evidencing the Trustee's security interest therein have
been filed of record in the manner provided for by 20 U.S.C. ss.1087-2(d)(3) and
20 U.S.C. ss.1082(m)1(D)(iv)."
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned
to ___________________________________________________________________________,
as trustee (the "Trustee") under the_______________, dated as
of_________________, by and between Education Loans Incorporated and the Trustee
(but for the account and on behalf of Education Loans Incorporated), without
recourse except as provided in paragraph 8 of the Student Loan Purchase
Agreement dated as of [ , ] between Education Loans Incorporated
and____________________________________________________________.
________________________________________ ___________________________________
Title and Signature of Name of Transferor
Trustee Officer
________________________________________ ___________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, 19____"
NOTICE
"The within note and related documentation is subject to a Uniform Commercial
Code Security Agreement between Education Loans Incorporated , and
_____________________________________________________________________, as
Trustee, and Financing Statements evidencing the Trustee's security interest
therein have been filed of record in the manner provided for by 20 U.S.C.
ss.1087-2(d)(3) and 20 U.S.C. ss.1082(m)1(D)(iv)."
Exhibit "D" to Student Loan Purchase Agreement
Representations, warranties, covenants and agreements of Lender:
A. Any information furnished by the Lender to the Corporation or its agents
(including the Servicer) with respect to any Eligible Loan to be Financed is
true, complete and correct.
B. The amount of the unpaid principal balance of each Eligible Loan to be
Financed is due and owing, and no counterclaim, offset, defense or right of
rescission exists with respect to any Eligible Loan to be Financed which could
be asserted and maintained or which, with notice, lapse of time, or the
occurrence or failure to occur of any act or event, could be asserted and
maintained, by the borrower against the Trustee as assignee of such Eligible
Loan. The Lender shall take all reasonable actions to assure that no maker of an
Eligible Loan has or may acquire a defense to the payment thereof. No Eligible
Loan to be Financed carries a rate of interest less than or in excess of the
applicable rate provided by the provisions of the Higher Education Act, except
as previously approved in writing by the Corporation with respect to a lower
rate of interest.
C. Each Eligible Loan to be Financed has been duly executed and delivered
and constitutes the legal, valid and binding obligation of the maker (and the
endorser or co-maker) thereof, enforceable in accordance with its terms.
D. Each Eligible Loan to be Financed complies in all respects with the
requirements of the Higher Education Act and this Agreement and is an Eligible
Loan as that term is defined in this Agreement. If a promissory note relating to
an Eligible Loan to be Financed covers more than one loan, all loans covered
thereby are to be Financed and constitute an Eligible Loan.
E. The Lender has applied for and received the Guarantor's or Secretary's
designation, as the case may be, as an "eligible lender" under the Higher
Education Act. No payment of principal or of interest with respect to any
Eligible Loan sold hereunder shall be delinquent by more than 37 days on the
Loan Purchase Date unless waived by the Servicer pursuant to Section 7.D of this
Agreement.
F. The Lender is the sole owner and holder of each Eligible Loan to be
Financed and has full right and authority to sell and assign the same free and
clear of all liens, pledges or encumbrances, and no Eligible Loan to be Financed
has been pledged or assigned for any purpose.
G. Each Eligible Loan to be Financed is either insured by the Secretary or
guaranteed by a Guarantor as to 98% of the principal and interest on the
Eligible Loan, such Insurance or Guarantee,, as the case may be, is in full
force and effect, is freely transferable as an incident to the sale of each
Eligible Loan to be Financed; all premiums due and payable to the Guarantor,
have been or will be paid in full by the Lender and none of the Eligible Loans
to be Financed has at any time been tendered to the Secretary or the Guarantor
for payment and rejected unless the situation giving rise to such rejection has
been cured.
H. There are no circumstances or conditions with respect to any Eligible
Loan to be Financed, the borrower thereunder or the creditworthiness of said
borrower that would reasonably cause prudent private investors to regard any of
the Eligible Loans to be Financed as an unacceptable investment, or adversely
affect the value or marketability thereof or the guarantee thereof.
I. Each Eligible Loan to be Financed was made in compliance with all
applicable local, state and federal laws, rules and regulations, including
without limitation all applicable nondiscrimination, truth-in-lending, consumer
credit and usury laws.
J. The Lender has, and its officers acting on its behalf have, full legal
authority to engage in the transactions contemplated by this Agreement; the
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and compliance with the terms, conditions and provisions of
this Agreement do not and will not conflict with or result in a breach of any of
the terms, conditions or provisions of the charter, Articles or Bylaws of the
Lender or any agreement or instrument to which the Lender is a party or by which
it is bound, or constitute a default thereunder; the Lender is not a party to or
bound by any agreement or instrument or subject to any charter or other
corporate restriction or judgment, order, writ, injunction, decree, law, rule or
regulation which may materially and adversely affect the ability of the Lender
to perform its obligations under this Agreement and this Agreement constitutes a
valid and binding obligation of the Lender enforceable against it in accordance
with its terms, and no consent, approval or authorization of any government or
governmental body, including, without limitation, the Federal Deposit Insurance
Corporation, the Comptroller of the Currency, the Board of Governors of the
Federal Reserve System, the Office of Thrift Supervision or any state bank
regulatory agency, is required in connection with the consummation of the
transactions herein contemplated.
K. The Lender is duly organized, validly existing and in good standing
under the laws of its applicable jurisdiction and has the power and authority to
own its assets and carry on its business as now being conducted.
L. The Lender and each independent servicer has exercised and shall
continue to exercise due diligence and reasonable care in making, administering,
servicing and collecting the Eligible Loans to be Financed and the Lender has
conducted a reasonable investigation of sufficient scope and content to enable
it duly to make the representations and warranties contained in this Exhibit D.
The Lender shall be solely responsible for the payment of the costs and expenses
incident to origination of the Eligible Loans, without any right of
reimbursement therefor from the Corporation. With respect to all Guaranteed
Loans being acquired, a Guarantee Agreement is in effect with respect thereto
and is valid and binding upon the parties thereto in all respects material to
the security of the Obligations, and the Lender is not in default in the
performance of any of its covenants and agreements made in such Guarantee
Agreement.
M. The Lender shall notify the borrower of the sale in the manner provided
in the Higher Education Act.
N. In determining the need of the Eligible Borrowers for Eligible Loans, no
Eligible Loan may be made in an amount greater than the difference between the
cost of education for the relevant period and the other aid awarded for such
period, and the maximum amount of loans to any Eligible Borrower made pursuant
to the Higher Education Act shall not exceed the limits stated therein.
O. Each Eligible Loan made pursuant to Section 428B of the Higher Education
Act shall be subject to the credit requirements as determined by the Lender and
the Guarantor which may include but are not necessarily limited to those
described in Exhibit F to this Loan Purchase Agreement.
P. At the time a Lender makes an Eligible Loan to an Eligible Borrower, the
Lender shall provide thorough and accurate loan information to the Eligible
Borrower, which shall include all information required to be provided to an
Eligible Borrower pursuant to Section 433 of the Higher Education Act and any
other information that a lender is required to provide an Eligible Borrower by
the Guarantor or the Secretary of Education.
[Remainder of page Intentionally Left Blank]
Exhibit "E" to Student Loan Purchase Agreement
The assignment of the within promissory note and related documents
to____________________________________, as trustee (the"Trustee") under the
_______________________________________________________, dated as of
__________________, between Education Loans Incorporated and the Trustee (but
for the account and on behalf of Education Loans Incorporated), affixed pursuant
to a Student Loan Purchase Agreement dated as of [ , ] did not become
effective there under and no rights in the same have been conveyed thereby.
Dated: ____________________________
_____________________________________
Title and Signature of
Trustee Officer
Exhibit "F" to Student Loan Purchase Agreement
ADVERSE CREDIT FOR DETERMINING FEDERAL PLUS LOAN ELIGIBILITY
The lender must obtain a credit history of the parent applicant from at least
one national credit bureau organization. This credit report must be secured
within a time frame that ensures the most accurate, current representation of
the applicant's credit history before the first day of the period of enrollment
for which the loan is intended. When reviewing the credit report, unless the
lender determines that an extenuating circumstance exists, the lender should
consider an applicant to have an adverse credit history if any of the following
conditions are evidenced by the credit report:
1. The applicant(s), on the date of the lender's examination of the credit
report, is considered 90 days or more delinquent on the repayment of any
debt; or
2. The applicant(s) have been the subject of a default determination (on any
debt), foreclosure, repossession, tax lien, wage garnishment or write-off
of a Title IV debt during the five years preceding the date of the credit
report; provided that the failure to pay a debt that has been discharged in
bankruptcy or that is dischargeable in a pending bankruptcy proceeding
shall not be deemed an adverse credit history.
If one of these conditions exists, the lender may still make the loan if the
lender determines, and documents in the file, that extenuating circumstances
exist. The documentation of extenuating circumstances may include, but is not
limited to:
1. an updated credit report that shows the applicant is no longer 90 or more
days delinquent on a debt or corrects other information found on the
original credit report examined by the lender that led to the determination
of adverse credit;
2. a statement from the creditor that the applicant has made satisfactory
arrangements to repay the debt(s) that is the basis of the adverse credit
determination;
3. in the case of a debt with an outstanding balance that is less than $500
but is 90 days or more delinquent, a satisfactory written explanation from
the applicant explaining the reason for the delinquency; or
4. evidence that the debt that is the basis of the adverse credit
determination has been discharged in bankruptcy or is dischargeable in
pending bankruptcy proceedings.
A lender may have stricter standards for determining adverse credit than those
outlined above.
Exhibit "G" to Student Loan Purchase Agreement
(Opinion dated as of Date of Agreement)
Education Loans Incorporated
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
Re: STUDENT LOAN PURCHASE AGREEMENT
Dated as of [ , ]
Gentlemen:
Pursuant to the above mentioned Student Loan Purchase Agreement (the
"Agreement") between Education Loans Incorporated and
_________________________________, (the "Lender"), we have reviewed the
Agreement and made such examinations and further investigations as we deemed
necessary as a basis for the opinions expressed herein. All capitalized terms
used in this opinion and not otherwise defined shall have the same meanings as
in the Agreement. Pursuant to Paragraph 5 of the Agreement, you have requested
our opinion on a number of matters. Opinions hereinafter expressed are qualified
to the extent the validity or enforceability of any provisions in the Agreement
or the Eligible Loans or of any rights granted to you pursuant to any of these
instruments, may be subject to or affected by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the rights of creditor
generally or by general principles of equity.
Based upon the foregoing, and having regard to legal consideration which we
deem relevant, we are of the opinion that:
(i) The Lender is duly organized and existing and in good standing under
the laws of the jurisdiction of its organization.
(ii) The Agreement has been duly authorized, executed and delivered by the
Lender, is in full force and effect and constitutes the legal, valid, binding
and enforceable obligation of the Lender.
(iii) The Lender has all requisite power and authorization under the laws
of the jurisdiction of its organization, to sell, assign and transfer the
promissory notes evidencing the Eligible Loans to the Corporation or to the
Trustee on behalf of the Corporation, and to enter into and carry out its
obligations under the Agreement;
(iv) No authorization or approval of any governmental authority (other than
notice to the Secretary of Education and approval of the Guarantor for the sale
of the Eligible Loans) is required for the execution and delivery of the
Agreement, or the sale, transfer and assignment of the Eligible Loans;
(v) The officers of the Lender are authorized to execute the endorsement
required by the Agreement, transferring the Eligible Loans to be Financed;
(vi) With respect to all Financed Guaranteed Eligible Loans, the applicable
Guarantee Agreement has been duly authorized, executed and delivered by the
Lender and is in full force and effect, and with respect to all Financed Insured
Eligible Loans the applicable insurance is in full force and effect.
Very truly yours
(Lender's Counsel)
EXHIBIT 10.2(b)
STUDENT LOAN FINANCE CORPORATION
GOAL LOAN PROGRAM
STUDENT LOAN PURCHASE AGREEMENT
This Agreement made and entered into as of this first day of [ , ],
by and between EDUCATION LOANS INCORPORATED, (hereinafter referred to as the
"Corporation"), and STUDENT LOAN FINANCE CORPORATION a corporation organized and
existing under the laws of the State of South Dakota and having the principal
office at 000 Xxxxx Xxxxxx Xxxxxxxxx in the City of Aberdeen, State of South
Dakota (hereinafter referred to as the "Seller").
WITNESSETH:
WHEREAS, pursuant to the GOAL Loan Program of the Seller, the Corporation
desires to cause the purchase from the Seller of certain loans made pursuant to
such program and the Seller desires to cause the origination of such loans and
to sell such loans to the Corporation's Trustee (as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties agree as follows:
1. Definitions.
In this Agreement, the following terms shall have the following respective
meanings unless the context clearly requires otherwise:
"Eligible Borrower" shall mean a borrower who is eligible under the GOAL
Loan Program to be the obligor of a loan for financing a program of
post-secondary education for a student eligible under such program.
"Eligible Loan" shall mean a loan to an Eligible Borrower for
post-secondary education made in accordance with the requirements of the GOAL
Loan Program.
"Financed", in the case of Eligible Loans, shall mean those Eligible Loans
acquired by the Trustee on behalf of the Corporation from the Seller pursuant to
this Agreement with moneys derived from any of the funds or accounts established
by the Indenture, inclusive of the promissory notes evidencing such Eligible
Loans and the related documentation in connection with each thereof.
"GOAL Loan Program" shall mean the programs established by the Seller for
the origination of loans to finance costs of post-secondary education in excess
of those costs financed from loans made under the Higher Education Act.
"Higher Education Act" shall mean the Higher Education Act of 1965, as
amended or supplemented from time to time, and all regulations promulgated
thereunder.
"Indenture" shall mean the Indenture, dated as of [ , ], between the
Corporation and the Trustee.
"Loan Purchase Date" has the meaning assigned thereto in Section 2.C. of
this Agreement.
"Obligations" shall mean all notes, bonds or other obligations of the
Corporation (including those issued pursuant to the Indenture) incurred to
finance or refinance the purchase of Eligible Loans or for other purposes
authorized by the indenture under which such obligations were issued.
"Origination Fee", with respect to an Eligible Loan, shall mean the
origination fee payable in connection with the origination of such Eligible Loan
in accordance with the GOAL Loan Program.
"Servicer" shall mean the Seller, as servicer of the Eligible Loans to be
purchased pursuant to this Agreement, and any successor thereto in such capacity
as designated in writing by the Corporation.
"State" shall mean the State of South Dakota.
"Trustee" means U.S. Bank National Association, Minneapolis, Minnesota, in
its capacity as trustee under the Indenture, or any successor thereto in such
capacity or any assignee thereof.
The term "Agreement" shall include Exhibits "A" through "E" attached
hereto.
2. Commitment and Purchase.
A. Subject to the terms and conditions and in reliance on the
representations, warranties and agreements set forth in this Agreement, the
Seller agrees to sell to the Trustee on behalf of the Corporation, and the
Corporation agrees to cause the Trustee to buy from the Seller, Eligible
Loans the Seller may choose to sell from time to time. The Eligible Loans
sold to the Trustee on behalf of the Corporation pursuant to this Agreement
shall be Eligible Loans made pursuant to the GOAL Loan Program.
B. Upon the purchase of each Eligible Loan pursuant to this Agreement,
the Seller shall pay to the Trustee on behalf of the Corporation an amount
equal to the Origination Fee applicable to such Eligible Loan.
C. The delivery of, and payment for, the Eligible Loans shall take
place at the Servicer's offices on a date or dates not later than 60 months
after the date of this Agreement, to be specified by the Servicer by not
less than fifteen days' prior written notice (the "Loan Purchase Date").
D. The Corporation agrees to cause the Trustee to purchase the
Eligible Loans at a price equal to 100% of the outstanding unpaid principal
amount thereof on the Loan Purchase Date, plus accrued borrower interest.
Following any Loan Purchase Date, the parties agree to adjust the purchase
price based on the actual payments required to be made, to the extent the
amount of such payments was not known as of the Loan Purchase Date.
E. Transfer of the Eligible Loans shall be by the means specified in
this Agreement.
F. Each Financed Eligible Loan shall have physically stamped thereon a
notice in the form set forth in Exhibit "B".
3. Representations, Warranties, Covenants and Agreements of the Seller. The
Seller hereby makes, and shall be deemed to again make as of each Loan Purchase
Date, each representation, warranty, covenant and agreement set forth in Exhibit
"C".
4. Survival of Representations and Warranties. Each representation,
warranty, certification and agreement contained in this Agreement shall survive
the Loan Purchase Date.
5. Conditions of Purchase.
The Corporation's obligation to cause the Trustee to purchase and pay for
the Eligible Loans to be Financed hereunder shall be subject to the following
conditions precedent:
A. All representations, warranties and statements by or on behalf of
the Seller contained in this Agreement shall be true on the Loan Purchase
Date.
B. Receipt by the Trustee of all related Origination Fees.
C. The entire interest of the Seller in each Eligible Loan to be
Financed shall have been duly assigned by endorsement in the form set forth
in Exhibit "B", such endorsement to be without recourse except as provided
in paragraph 8.
D. Physical custody and possession of (i) the promissory notes
evidencing the Financed Eligible Loans shall be transferred to the Trustee,
and (ii) all other information and documentation relating to the Financed
Eligible Loans (including the documentation described in Exhibit "A") shall
be transferred in the manner directed by the Servicer.
E. The Corporation shall receive an opinion of Seller's counsel, dated
as of the date of this Agreement, in substantially the form set forth in
Exhibit "E". The Servicer shall receive a Seller's Closing Certificate,
substantially in the form of Exhibit "A", when requested by the
Corporation.
F. If the promissory note evidences more than one loan, all loans
covered thereby must be assigned hereunder and must qualify as Eligible
Loans.
6. Purchase Conditional.
The Corporation's obligation to cause the Trustee to purchase Eligible
Loans pursuant to this Agreement is subject to availability of funds therefor
under the Indenture.
7. Rejection of Loans.
A. If (i) the Seller is unable to make or furnish the representations
and warranties required to be made or furnished by it pursuant to this
Agreement as to a loan, or (ii) if the Seller is unable to fulfill one or
more covenants or conditions of this Agreement as to a loan, or (iii) if
the Servicer (if other than the Seller) in its reasonable judgment deems
that a loan does not comply with the terms and conditions of this Agreement
or is not being delivered in compliance with such terms and conditions,
then the Corporation may, in its sole discretion, refuse to accept and
cause the Trustee to pay for such loan (or any substitute loan offered by
the Seller in lieu thereof).
B. If a loan is rejected, any such loan shall be returned to the
Seller by registered mail (for repurchase pursuant to paragraph 8 if
theretofore purchased by the Trustee on behalf of the Corporation) together
with a letter identifying each returned loan and stating the basis for its
return. Any such loan returned to the Seller which has been endorsed to the
Trustee shall be endorsed by the Trustee to the Seller in the form set
forth in Exhibit "D". The liability of the Corporation, the Servicer and
the Trustee in connection with the loss of or damage to any loans to be
returned to the Seller hereunder shall be limited to such loss or damage
occurring as a result of their negligence or willful misconduct in handling
or safekeeping such loans.
C. If a loan is rejected, the Seller may substitute a different
Eligible Loan for the rejected loan, provided, however, that the terms and
conditions of such Eligible Loan are acceptable to the Servicer.
D. If at the Loan Purchase Date any Eligible Loan to be Financed is
more than 37 days delinquent with respect to any payment of principal or
interest, the Corporation may elect to cause the Trustee to purchase such
Eligible Loan and allow the Seller 15 days from the Loan Purchase Date
within which to cause such delinquency to be cured. If the delinquency
cannot be so cured, such Financed Eligible Loan shall be subject to
repurchase pursuant to Paragraph 8.
8. Repurchase Obligation.
If:
(i) any representation or warranty made or furnished by the Seller in
or pursuant to this Agreement shall prove to have been materially
incorrect;
(ii) on account of any circumstances or event that occurred prior to
the sale of a loan to the Trustee on behalf of the Corporation pursuant to
this Agreement, a defense is asserted by a maker (or endorser, if any) of
such loan with respect to his obligation to pay all or any part of such
loan and the Corporation in good faith believes that the facts reported, if
true, raise a reasonable doubt as to the legal enforceability of such loan;
or
(iii) a Financed Eligible Loan is required to be repurchased pursuant
to paragraph 7.B or 7.D,;
then the Seller shall repurchase such loan upon the Servicer's or Trustee's
request by paying to the Trustee, for the account of the Corporation, the then
outstanding principal balance of such loan (or such greater amount as may be
necessary to make the Corporation and the Trustee whole in light of the purchase
price originally paid by the Trustee for such loan), plus interest accrued and
unpaid with respect to such loan from the Loan Purchase Date to and including
the date of repurchase, plus any attorneys' fees, legal expenses, court costs,
servicing fees or other expenses incurred by the Corporation, the Servicer and
the Trustee in connection with such loan. Upon receipt of such amounts, the
Corporation shall cause the Trustee to transfer to the Seller the amount of the
related Origination Fee.
9. Notification to Borrowers.
The Seller and the Corporation agree that the Servicer and the Seller shall
either jointly or separately notify each borrower under the Financed Eligible
Loans of the assignment and transfer to the Trustee (but for the account and on
behalf of the Corporation) of the Seller's interest in such Financed Eligible
Loans and direct each borrower to make all payments thereon directly to the
Servicer until otherwise notified by the Trustee.
10. Obligations to Forward Payments and Communications.
A. The Seller shall promptly remit, or cause to be remitted, to the
Trustee as the Servicer may direct, all funds received by the Seller after
the Loan Purchase Date which constitute payments of principal, or interest
accrued after the Loan Purchase Date, with respect to any Financed Eligible
Loan.
B. The Seller shall immediately transmit to the Servicer any
communication received by the Seller after the Loan Purchase Date with
respect to a Financed Eligible Loan or the borrower under such a Financed
Eligible Loan. Such communication shall include, but not be limited to,
letters, notices of death or disability, adjudications of bankruptcy and
similar documents, and forms requesting deferment of repayment or loan
cancellations.
11. Payment of Expenses and Taxes.
Except as specifically provided herein, each party to this Agreement shall
pay its own expenses incurred in connection with the preparation, execution and
delivery of this Agreement and the transactions herein contemplated, including,
but not limited to, the fees and disbursements of counsel, provided, however,
that the Seller shall pay any transfer or other taxes and recording or filing
fees payable in connection with the sale and purchase of the Eligible Loans to
be Financed.
12. lndemnification.
The Seller specifically acknowledges that the Corporation will be making
representations and warranties regarding the Eligible Loans to be Financed as
part of the proposed offering of Obligations of the Corporation (including
without limitation Obligations to be issued under the Indenture) based in part
on the accuracy of the Seller's representations and warranties in this
Agreement. The Seller agrees to indemnify and save the Trustee and the
Corporation harmless of, from and against any and all loss, cost, damage or
expense, including reasonable attorneys' fees, incurred by reason of any breach
of the Seller's warranties or representations hereunder or any false or
misleading representations of the Seller or any failure to disclose any matter
which makes the warranties and representations herein misleading or any
inaccuracy in any information furnished by the Seller in connection herewith.
13. Other Provisions.
A. The Seller shall furnish to the Servicer such additional
information concerning the Seller's Eligible Loan portfolio as the Servicer
may reasonably request.
B. The Seller shall, at its expense, execute all other documents and
take all other steps as may be requested by the Servicer or the Trustee
from time to time to effect the sale hereunder of the Eligible Loans to be
purchased by the Trustee on behalf of the Corporation.
C. The provisions of this Agreement cannot be waived or modified
unless such waiver or modification be in writing and signed by the parties
hereto and the Trustee. Inaction or failure to demand strict performance
shall not be deemed a waiver.
D. This Agreement shall be governed by the laws of the State.
E. All covenants and agreements herein contained shall extend to and
be obligatory upon all successors of the respective parties hereto.
F. This Agreement may be simultaneously executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
G. If any provision of this Agreement shall be held, or deemed to be
or shall, in fact, be inoperative or unenforceable as applied in any
particular situation, such circumstance shall not have the effect of
rendering the provision in question inoperative or unenforceable in any
other situation, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to
any extent whatsoever. The invalidity of any one or more phrases,
sentences, clauses or paragraphs herein contained shall not affect the
remaining portions of this Agreement or any part hereof.
H. All notices, requests, demands or other instruments which may or
are required to be given by either party to the other or to the Trustee or
the Servicer, shall be in writing and each shall be deemed to have been
properly given when served personally on an officer of the party to whom
such notice is to be given, or upon expiration of a period of 48 hours from
and after the postmark thereof when mailed postage prepaid by registered or
certified mail, requesting return receipt, addressed as follows:
If intended for the Corporation or the Servicer:
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
If intended for the Seller:
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
If intended for the Trustee:
U.S. Bank National Association
Post Office Box 1308
141 North Main Avenue
Sioux Falls, South Dakota 57117-1308]
Either party, the Servicer or the Trustee may change the address and name
of the addressee to which subsequent notices are to be sent to it, by notice to
the others given as aforesaid, but any such notice of change, if sent by mail,
shall not be effective until the fifth day after it is mailed.
I. This Agreement may not be terminated by either party hereto except
in the manner and with the effect herein specifically provided for.
J. Time is of the essence in this Agreement.
K. This Agreement shall not be assignable by the Seller, in whole or
in part, without the prior written consent of the Corporation and the
Trustee.
L. No remedy by the terms of this Agreement conferred upon or reserved
to the Trustee or the Corporation is intended to be exclusive of any other
remedy, but each and every such remedy shall be cumulative and in addition
to every other remedy given under this Agreement or existing at law or in
equity (including, without limitation, the right to such equitable relief
by way of injunction), or by statute on or after the date of this
Agreement.
M. This Agreement has been made and entered into not only for the
benefit of the Seller and the Corporation but also for the benefit of the
Trustee and all holders of Obligations issued for the purpose of financing
Eligible Loans and any other assignee of loans purchased hereunder
(including any trustee for holders of bonds, notes or other evidences of
indebtedness issued by the Corporation to refinance such loans), and its
provisions may be enforced not only by the parties to this Agreement but
also by the Trustee or such other assignee.
14. Non-Petition Covenant.
The Seller, by entering into this Agreement, covenants and agrees that it
shall not at any time petition or otherwise invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Corporation under any federal or state bankruptcy, insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Corporation or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Corporation, in connection with any obligation relating to this Agreement.
IN WITNESS WHEREOF, The parties have hereunto set their hands and seals as
of the day and year first above written.
EDUCATION LOANS INCORPORATED STUDENT LOAN FINANCE CORPORATION
By______________________________ By_________________________________
Title:_________________ Title:___________________
ATTEST:
___________________________________
Title:___________________
Exhibit "A" to Student Loan Purchase Agreement
SELLER'S CLOSING CERTIFICATE
Student Loan Finance Corporation (the "Seller") does hereby certify that
all representations, warranties and statements by or on behalf of the
undersigned contained in a certain Student Loan Purchase Agreement by and
between the Seller and Education Loans Incorporated, dated as of [ , ] (the
"Agreement"), are true and correct on and as of the date hereof, without
exception or qualification whatsoever;
FURTHERMORE, the Seller does hereby certify that the following documents,
where applicable to each Eligible Loan Financed under the Agreement, have
heretofore been furnished to the Corporation pursuant to paragraph 5.D. of the
Agreement:
Promissory note(s)
Evidence of disbursement
Disclosure statement
Any other documentation held by the Seller relating to the history of
such Eligible Loan
Uniform Commercial Code financing statement, if any, securing any interest
in an Eligible Loan to be Financed, and an executed termination
statement related thereto
FURTHERMORE, the Seller does hereby certify that it has in its possession
evidence of loan disbursement for each Eligible Loan, and does hereby warrant
that it will maintain such evidence throughout the term of each such Eligible
Loan and will provide a copy thereof to the Servicer and the Trustee upon
request.
IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed and delivered by its officers thereunto duly authorized this
______________, day of _____________________________, ______.
STUDENT LOAN FINANCE CORPORATION
By__________________________________
Title:_________________________
ATTEST:
________________________
Title:__________________
Exhibit "B" to Student Loan Purchase Agreement
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to U.S. Bank National
Association, Minneapolis, Minnesota as trustee (the "Trustee") under the
Indenture, dated as of [ , ], by and between Education Loans Incorporated and
the Trustee (but for the account and on behalf of Education Loans Incorporated),
without recourse except as provided in paragraph 8 of the Student Loan Purchase
Agreement dated as of [ , ], between Education Loans Incorporated and Student
Loan Finance Corporation.
_______________________________ _________________________________
Title and Signature of Name of Transferor
Trustee Officer
_______________________________ _________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, ______"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement between Education Loans Incorporated, and
U.S. Bank National Association, Minneapolis, Minnesota, as Trustee, and
Financing Statements evidencing the Trustee's security interest therein have
been filed of record in the manner provided for by 20 U.S.C. ss.1087-2(d)(3)."
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to
_____________________________________________________________________________,
as trustee (the "Trustee") under the _______________, dated as
of_________________, by and between Education Loans Incorporated and the Trustee
(but for the account and on behalf of Education Loans Incorporated), without
recourse except as provided in paragraph 8 of the Student Loan Purchase
Agreement dated as of [ , ], between Education Loans Incorporated and Student
Loan Finance Corporation.
_______________________________ _________________________________
Title and Signature of Name of Transferor
Trustee Officer
_______________________________ _________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, ______"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement between Education Loans Incorporated and
_____________________________________________________________________, as
Trustee, and Financing Statements evidencing the Trustee's security interest
therein have been filed of record in the manner provided for by 20 U.S.C.
ss.1087-2(d)(3)."
Exhibit "C" to Student Loan Purchase Agreement
Representations, warranties, covenants and agreements of Seller:
A. Any information furnished by the Seller to the Corporation or its agents
(including the Servicer) with respect to any Eligible Loan to be Financed is
true, complete and correct.
B. The amount of the unpaid principal balance of each Eligible Loan to be
Financed is due and owing, and no counterclaim, offset, defense or right of
rescission exists with respect to any Eligible Loan to be Financed which could
be asserted and maintained or which, with notice, lapse of time, or the
occurrence or failure to occur of any act or event, could be asserted and
maintained, by the borrower against the Trustee as assignee of such Eligible
Loan. The Seller shall take all reasonable actions to assure that no maker of an
Eligible Loan has or may acquire a defense to the payment thereof.
C. Each Eligible Loan to be Financed has been duly executed and delivered
and constitutes the legal, valid and binding obligation of the maker (and the
endorser or co-maker) thereof, enforceable in accordance with its terms.
D. Each Eligible Loan to be Financed complies in all respects with the
requirements of the GOAL Loan Program and this Agreement and is an Eligible Loan
as that term is defined in this Agreement. If a promissory note relating to an
Eligible Loan to be Financed covers more than one loan, all loans covered
thereby are to be Financed and constitute an Eligible Loan.
E. No payment of principal or of interest with respect to any Eligible Loan
sold hereunder shall be delinquent by more than 37 days on the Loan Purchase
Date unless waived by the Corporation pursuant to Section 7.D of this Agreement.
F. The Seller is the sole owner and holder of each Eligible Loan to be
Financed and has full right and authority to sell and assign the same free and
clear of all liens, pledges or encumbrances, and no Eligible Loan to be Financed
has been pledged or assigned for any purpose.
G. Each Eligible Loan to be Financed was made in compliance with all
applicable local, state and federal laws, rules and regulations, including
without limitation all applicable nondiscrimination, truth-in-lending, consumer
credit and usury laws.
H. The Seller has, and its officers acting on its behalf have, full legal
authority to engage in the transactions contemplated by this Agreement; the
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and compliance with the terms, conditions and provisions
hereof do not and will not conflict with or result in a breach of any of the
terms, conditions or provisions of the Articles or Bylaws of the Seller or any
agreement or instrument to which the Seller is a party or by which it is bound,
or constitute a default thereunder; the Seller is not a party to or bound by any
agreement or instrument or subject to any charter or other corporate restriction
or judgment, order, writ, injunction, decree, law, rule or regulation which may
materially and adversely affect the ability of the Seller to perform its
obligations under this Agreement; this Agreement constitutes a valid and binding
obligation of the Seller enforceable against it in accordance with its terms;
and no consent, approval or authorization of any government or governmental
body, including, without limitation, the Federal Deposit Insurance Corporation,
the Comptroller of the Currency, the Board of Governors of the Federal Reserve
System, the Office of Thrift Supervision or any state bank regulatory agency, is
required in connection with the consummation of the transactions herein
contemplated.
I. The Seller is duly organized, validly existing and in good standing
under the laws of the State and has the power and authority to own its assets
and carry on its business as now being conducted.
J. The Seller and each independent servicer has exercised and shall
continue to exercise due diligence and reasonable care in making, administering,
servicing and collecting the Eligible Loans to be Financed and the Seller has
conducted a reasonable investigation of sufficient scope and content to enable
it duly to make the representations and warranties contained in this Exhibit C.
The Seller shall be solely responsible for the payment of the costs and expenses
incident to origination of the Eligible Loans, without any right of
reimbursement therefor from the Corporation.
K. In determining the need of the Eligible Borrowers for Eligible Loans, no
Eligible Loan may be made in an amount greater than the difference between the
cost of education for the relevant period and the other aid awarded for such
period, and the maximum amount of loans to any Eligible Borrower made pursuant
to the GOAL Loan Program shall not exceed the limits stated therein.
L. Each Eligible Loan shall be subject to the credit requirements of the
GOAL Loan Program.
M. At the time the Seller makes, or causes to be made, an Eligible Loan to
an Eligible Borrower, the Seller shall provide thorough and accurate loan
information to the Eligible Borrower.
Exhibit "D" to Student Loan Purchase Agreement
The assignment of the within promissory note and related documents
to____________________________________, as trustee (the"Trustee") under the
_______________________________________________________, dated as of
__________________, between Education Loans Incorporated and the Trustee (but
for the account and on behalf of Education Loans Incorporated), affixed pursuant
to a Student Loan Purchase Agreement dated as of [ , ], did not become
effective there under and no rights in the same have been conveyed thereby.
Dated:____________________________
___________________________________________
Title and Signature of Trustee Officer
Exhibit "E" to Student Loan Purchase Agreement
(Opinion dated as of Date of Agreement)
Education Loans Incorporated
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
Re: Student Loan Purchase Agreement
Dated as of [ , ]
Gentlemen:
Pursuant to the above mentioned Student Loan Purchase Agreement (the
"Agreement") between Education Loans Incorporated and Student Loan Finance
Corporation (the "Seller"), we have reviewed the Agreement and made such
examinations and further investigations as we deemed necessary as a basis for
the opinions expressed herein. All capitalized terms used in this opinion and
not otherwise defined shall have the same meanings as in the Agreement. Pursuant
to Paragraph 5 of the Agreement, you have requested our opinion on a number of
matters. Opinions hereinafter expressed are qualified to the extent the validity
or enforceability of any provisions in the Agreement or the Eligible Loans or of
any rights granted to you pursuant to any of these instruments, may be subject
to or affected by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the rights of creditor generally or by general
principles of equity.
Based upon the foregoing, and having regard to legal considerations which
we deem relevant, we are of the opinion that:
(i) The Seller is duly organized and existing and in good standing under
the laws of the jurisdiction of its organization.
(ii) The Agreement has been duly authorized, executed and delivered by the
Seller, is in full force and effect and constitutes the legal, valid, binding
and enforceable obligation of the Seller.
(iii) The Seller has all requisite power and authorization under the laws
of the jurisdiction of its organization, to sell, assign and transfer the
promissory notes evidencing the Eligible Loans to the Trustee on behalf of the
Corporation, and to enter into and carry out its obligations under the
Agreement;
(iv) No authorization or approval of any governmental authority is required
for the execution and delivery of the Agreement, or the sale, transfer and
assignment of the Eligible Loans; and
(v) The officers of the Seller are authorized to execute the endorsement
required by the Agreement, transferring the Eligible Loans to be Financed.
Very truly yours
(Seller's Counsel)
EXHIBIT 10.2(c)
STUDENT LOAN FINANCE CORPORATION
GOAL LOAN PROGRAM
STUDENT LOAN PURCHASE AGREEMENT
This Agreement made and entered into as of this first day of May, 1999, by
and between GOAL FUNDING, INC. (hereinafter referred to as the "Corporation"),
and STUDENT LOAN FINANCE CORPORATION a corporation organized and existing under
the laws of the State of South Dakota and having the principal office at 000
Xxxxx Xxxxxx Xxxxxxxxx in the City of Aberdeen, State of South Dakota
(hereinafter referred to as the "Seller").
WITNESSETH:
WHEREAS, pursuant to the GOAL Loan Program of the Seller, the Corporation
desires to cause the purchase from the Seller of certain loans made pursuant to
such program and the Seller desires to cause the origination of such loans and
to sell such loans to the Corporation's Trustee (as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties agree as follows:
1. Definitions.
In this Agreement, the following terms shall have the following respective
meanings unless the context clearly requires otherwise:
"Eligible Borrower" shall mean a borrower who is eligible under the GOAL
Loan Program to be the obligor of a loan for financing a program of
post-secondary education for a student eligible under such program.
"Eligible Loan" shall mean a loan to an Eligible Borrower for
post-secondary education made in accordance with the requirements of the GOAL
Loan Program..
"Financed", in the case of Eligible Loans, shall mean those Eligible Loans
acquired by the Trustee on behalf of the Corporation from the Seller pursuant to
this Agreement with moneys derived from any of the funds or accounts established
by the Indenture, inclusive of the promissory notes evidencing such Eligible
Loans and the related documentation in connection with each thereof.
"GOAL Loan Program" shall mean the programs established by the Seller for
the origination of loans to finance costs of post-secondary education in excess
of those costs financed from loans made under the Higher Education Act.
"Higher Education Act" shall mean the Higher Education Act of 1965, as
amended or supplemented from time to time, and all regulations promulgated
thereunder.
"Indenture" shall mean the Indenture, dated as of May 1, 1999, between the
Corporation and the Trustee.
"Loan Purchase Date" has the meaning assigned thereto in Section 2.C. of
this Agreement.
"Obligations" shall mean all notes, bonds or other obligations of the
Corporation (including those issued pursuant to the Indenture) incurred to
finance or refinance the purchase of Eligible Loans or for other purposes
authorized by the indenture under which such obligations were issued.
"Origination Fee", with respect to an Eligible Loan, shall mean the
origination fee payable in connection with the origination of such Eligible Loan
in accordance with the GOAL Loan Program.
"Servicer" shall mean the Seller, as servicer of the Eligible Loans to be
purchased pursuant to this Agreement, and any successor thereto in such capacity
as designated in writing by the Corporation.
"State" shall mean the State of South Dakota.
"Trustee" means U.S. Bank National Association, Minneapolis, Minnesota, in
its capacity as trustee under the Indenture, or any successor thereto in such
capacity or any assignee thereof.
The term "Agreement" shall include Exhibits "A" through "E" attached
hereto.
2. Commitment and Purchase.
A. Subject to the terms and conditions and in reliance on the
representations, warranties and agreements set forth in this Agreement, the
Seller agrees to sell to the Trustee on behalf of the Corporation, and the
Corporation agrees to cause the Trustee to buy from the Seller, Eligible
Loans the Seller may choose to sell from time to time. The Eligible Loans
sold to the Trustee on behalf of the Corporation pursuant to this Agreement
shall be Eligible Loans made pursuant to the GOAL Loan Program.
B. Upon the purchase of each Eligible Loan pursuant to this Agreement,
the Seller shall pay to the Trustee on behalf of the Corporation an amount
equal to the Origination Fee applicable to such Eligible Loan.
C. The delivery of, and payment for, the Eligible Loans shall take
place at the Servicer's offices on a date or dates not later than 60 months
after the date of this Agreement, to be specified by the Servicer by not
less than fifteen days' prior written notice (the "Loan Purchase Date").
D. The Corporation agrees to cause the Trustee to purchase the
Eligible Loans at a price equal to 100% of the outstanding unpaid principal
amount thereof on the Loan Purchase Date, plus accrued borrower interest.
Following any Loan Purchase Date, the parties agree to adjust the purchase
price based on the actual payments required to be made, to the extent the
amount of such payments was not known as of the Loan Purchase Date.
E. Transfer of the Eligible Loans shall be by the means specified in
this Agreement.
F. Each Financed Eligible Loan shall have physically stamped thereon a
notice in the form set forth in Exhibit "B".
3. Representations, Warranties, Covenants and Agreements of the Seller. The
Seller hereby makes, and shall be deemed to again make as of each Loan Purchase
Date, each representation, warranty, covenant and agreement set forth in Exhibit
"C".
4. Survival of Representations and Warranties. Each representation,
warranty, certification and agreement contained in this Agreement shall survive
the Loan Purchase Date.
5. Conditions of Purchase.
The Corporation's obligation to cause the Trustee to purchase and pay for
the Eligible Loans to be Financed hereunder shall be subject to the following
conditions precedent:
A. All representations, warranties and statements by or on behalf of
the Seller contained in this Agreement shall be true on the Loan Purchase
Date.
B. Receipt by the Trustee of all related Origination Fees.
C. The entire interest of the Seller in each Eligible Loan to be
Financed shall have been duly assigned by endorsement in the form set forth
in Exhibit "B", such endorsement to be without recourse except as provided
in paragraph 8.
D. Physical custody and possession of (i) the promissory notes
evidencing the Financed Eligible Loans shall be transferred to the Trustee,
and (ii) all other information and documentation relating to the Financed
Eligible Loans (including the documentation described in Exhibit "A") shall
be transferred in the manner directed by the Servicer.
E. The Corporation shall receive an opinion of Seller's counsel, dated
as of the date of this Agreement, in substantially the form set forth in
Exhibit "E". The Servicer shall receive a Seller's Closing Certificate,
substantially in the form of Exhibit "A", when requested by the
Corporation.
F. If the promissory note evidences more than one loan, all loans
covered thereby must be assigned hereunder and must qualify as Eligible
Loans.
6. Purchase Conditional.
The Corporation's obligation to cause the Trustee to purchase Eligible
Loans pursuant to this Agreement is subject to availability of funds therefor
under the Indenture.
7. Rejection of Loans.
A. If (i) the Seller is unable to make or furnish the representations
and warranties required to be made or furnished by it pursuant to this
Agreement as to a loan, or (ii) if the Seller is unable to fulfill one or
more covenants or conditions of this Agreement as to a loan, or (iii) if
the Servicer (if other than the Seller) in its reasonable judgment deems
that a loan does not comply with the terms and conditions of this Agreement
or is not being delivered in compliance with such terms and conditions,
then the Corporation may, in its sole discretion, refuse to accept and
cause the Trustee to pay for such loan (or any substitute loan offered by
the Seller in lieu thereof).
B. If a loan is rejected, any such loan shall be returned to the
Seller by registered mail (for repurchase pursuant to paragraph 8 if
theretofore purchased by the Trustee on behalf of the Corporation) together
with a letter identifying each returned loan and stating the basis for its
return. Any such loan returned to the Seller which has been endorsed to the
Trustee shall be endorsed by the Trustee to the Seller in the form set
forth in Exhibit "D". The liability of the Corporation, the Servicer and
the Trustee in connection with the loss of or damage to any loans to be
returned to the Seller hereunder shall be limited to such loss or damage
occurring as a result of their negligence or willful misconduct in handling
or safekeeping such loans.
C. If a loan is rejected, the Seller may substitute a different
Eligible Loan for the rejected loan, provided, however, that the terms and
conditions of such Eligible Loan are acceptable to the Servicer.
D. If at the Loan Purchase Date any Eligible Loan to be Financed is
more than 37 days delinquent with respect to any payment of principal or
interest, the Corporation may elect to cause the Trustee to purchase such
Eligible Loan and allow the Seller 15 days from the Loan Purchase Date
within which to cause such delinquency to be cured. If the delinquency
cannot be so cured, such Financed Eligible Loan shall be subject to
repurchase pursuant to Paragraph 8.
8. Repurchase Obligation.
If:
(i) any representation or warranty made or furnished by the Seller in
or pursuant to this Agreement shall prove to have been materially
incorrect;
(ii) on account of any circumstances or event that occurred prior to
the sale of a loan to the Trustee on behalf of the Corporation pursuant to
this Agreement, a defense is asserted by a maker (or endorser, if any) of
such loan with respect to his obligation to pay all or any part of such
loan and the Corporation in good faith believes that the facts reported, if
true, raise a reasonable doubt as to the legal enforceability of such loan;
or
(iii) a Financed Eligible Loan is required to be repurchased pursuant
to paragraph 7.B or 7.D,;
then the Seller shall repurchase such loan upon the Servicer's or Trustee's
request by paying to the Trustee, for the account of the Corporation, the then
outstanding principal balance of such loan (or such greater amount as may be
necessary to make the Corporation and the Trustee whole in light of the purchase
price originally paid by the Trustee for such loan), plus interest accrued and
unpaid with respect to such loan from the Loan Purchase Date to and including
the date of repurchase, plus any attorneys' fees, legal expenses, court costs,
servicing fees or other expenses incurred by the Corporation, the Servicer and
the Trustee in connection with such loan. Upon receipt of such amounts, the
Corporation shall cause the Trustee to transfer to the Seller the amount of the
related Origination Fee.
9. Notification to Borrowers.
The Seller and the Corporation agree that the Servicer and the Seller shall
either jointly or separately notify each borrower under the Financed Eligible
Loans of the assignment and transfer to the Trustee (but for the account and on
behalf of the Corporation) of the Seller's interest in such Financed Eligible
Loans and direct each borrower to make all payments thereon directly to the
Servicer until otherwise notified by the Trustee.
10. Obligations to Forward Payments and Communications.
A. The Seller shall promptly remit, or cause to be remitted, to the
Trustee as the Servicer may direct, all funds received by the Seller after
the Loan Purchase Date which constitute payments of principal, or interest
accrued after the Loan Purchase Date, with respect to any Financed Eligible
Loan.
B. The Seller shall immediately transmit to the Servicer any
communication received by the Seller after the Loan Purchase Date with
respect to a Financed Eligible Loan or the borrower under such a Financed
Eligible Loan. Such communication shall include, but not be limited to,
letters, notices of death or disability, adjudications of bankruptcy and
similar documents, and forms requesting deferment of repayment or loan
cancellations.
11. Payment of Expenses and Taxes.
Except as specifically provided herein, each party to this Agreement shall
pay its own expenses incurred in connection with the preparation, execution and
delivery of this Agreement and the transactions herein contemplated, including,
but not limited to, the fees and disbursements of counsel, provided, however,
that the Seller shall pay any transfer or other taxes and recording or filing
fees payable in connection with the sale and purchase of the Eligible Loans to
be Financed.
12. lndemnification.
The Seller specifically acknowledges that the Corporation will be making
representations and warranties regarding the Eligible Loans to be Financed as
part of the proposed offering of Obligations of the Corporation (including
without limitation Obligations to be issued under the Indenture) based in part
on the accuracy of the Seller's representations and warranties in this
Agreement. The Seller agrees to indemnify and save the Trustee and the
Corporation harmless of, from and against any and all loss, cost, damage or
expense, including reasonable attorneys' fees, incurred by reason of any breach
of the Seller's warranties or representations hereunder or any false or
misleading representations of the Seller or any failure to disclose any matter
which makes the warranties and representations herein misleading or any
inaccuracy in any information furnished by the Seller in connection herewith.
13. Other Provisions.
A. The Seller shall furnish to the Servicer such additional
information concerning the Seller's Eligible Loan portfolio as the Servicer
may reasonably request.
B. The Seller shall, at its expense, execute all other documents and
take all other steps as may be requested by the Servicer or the Trustee
from time to time to effect the sale hereunder of the Eligible Loans to be
purchased by the Trustee on behalf of the Corporation.
C. The provisions of this Agreement cannot be waived or modified
unless such waiver or modification be in writing and signed by the parties
hereto and the Trustee. Inaction or failure to demand strict performance
shall not be deemed a waiver.
D. This Agreement shall be governed by the laws of the State.
E. All covenants and agreements herein contained shall extend to and
be obligatory upon all successors of the respective parties hereto.
F. This Agreement may be simultaneously executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
G. If any provision of this Agreement shall be held, or deemed to be
or shall, in fact, be inoperative or unenforceable as applied in any
particular situation, such circumstance shall not have the effect of
rendering the provision in question inoperative or unenforceable in any
other situation, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to
any extent whatsoever. The invalidity of any one or more phrases,
sentences, clauses or paragraphs herein contained shall not affect the
remaining portions of this Agreement or any part hereof.
H. All notices, requests, demands or other instruments which may or
are required to be given by either party to the other or to the Trustee or
the Servicer, shall be in writing and each shall be deemed to have been
properly given when served personally on an officer of the party to whom
such notice is to be given, or upon expiration of a period of 48 hours from
and after the postmark thereof when mailed postage prepaid by registered or
certified mail, requesting return receipt, addressed as follows:
If intended for the Corporation or the Servicer:
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
If intended for the Seller:
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
If intended for the Trustee:
U.S. Bank National Association
Post Office Box 1308
141 North Main Avenue
Sioux Falls, South Dakota 57117-1308]
Either party, the Servicer or the Trustee may change the address and name
of the addressee to which subsequent notices are to be sent to it, by notice to
the others given as aforesaid, but any such notice of change, if sent by mail,
shall not be effective until the fifth day after it is mailed.
I. This Agreement may not be terminated by either party hereto except
in the manner and with the effect herein specifically provided for.
J. Time is of the essence in this Agreement.
K. This Agreement shall not be assignable by the Seller, in whole or
in part, without the prior written consent of the Corporation and the
Trustee.
L. No remedy by the terms of this Agreement conferred upon or reserved
to the Trustee or the Corporation is intended to be exclusive of any other
remedy, but each and every such remedy shall be cumulative and in addition
to every other remedy given under this Agreement or existing at law or in
equity (including, without limitation, the right to such equitable relief
by way of injunction), or by statute on or after the date of this
Agreement.
M. This Agreement has been made and entered into not only for the
benefit of the Seller and the Corporation but also for the benefit of the
Trustee and all holders of Obligations issued for the purpose of financing
Eligible Loans and any other assignee of loans purchased hereunder
(including any trustee for holders of bonds, notes or other evidences of
indebtedness issued by the Corporation to refinance such loans), and its
provisions may be enforced not only by the parties to this Agreement but
also by the Trustee or such other assignee.
14. Non-Petition Covenant.
The Seller, by entering into this Agreement, covenants and agrees that it
shall not at any time petition or otherwise invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Corporation under any federal or state bankruptcy, insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Corporation or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Corporation, in connection with any obligation relating to this Agreement.
IN WITNESS WHEREOF, The parties have hereunto set their hands and seals as
of the day and year first above written.
GOAL FUNDING, INC. STUDENT LOAN FINANCE CORPORATION
By__________________________ By_______________________________
Title:_________________ Title:____________________
ATTEST:
_________________________________
Title:____________________
Exhibit "A" to Student Loan Purchase Agreement
SELLER'S CLOSING CERTIFICATE
Student Loan Finance Corporation (the "Seller") does hereby certify that
all representations, warranties and statements by or on behalf of the
undersigned contained in a certain Student Loan Purchase Agreement by and
between the Seller and GOAL Funding, Inc. dated as of May 1, 1999 (the
"Agreement"), are true and correct on and as of the date hereof, without
exception or qualification whatsoever;
FURTHERMORE, the Seller does hereby certify that the following documents,
where applicable to each Eligible Loan Financed under the Agreement, have
heretofore been furnished to the Corporation pursuant to paragraph 5.D. of the
Agreement:
Promissory note(s)
Evidence of disbursement
Disclosure statement
Any other documentation held by the Seller relating to the history of
such Eligible Loan
Uniform Commercial Code financing statement, if any, securing any
interest in an Eligible Loan to be Financed, and an executed
termination statement related thereto
FURTHERMORE, the Seller does hereby certify that it has in its possession
evidence of loan disbursement for each Eligible Loan, and does hereby warrant
that it will maintain such evidence throughout the term of each such Eligible
Loan and will provide a copy thereof to the Servicer and the Trustee upon
request.
IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed and delivered by its officers thereunto duly authorized this
______________, day of _____________________________, ______.
STUDENT LOAN FINANCE CORPORATION
By__________________________________
Title:_______________________
ATTEST:
____________________________
Title:______________________
Exhibit "B" to Student Loan Purchase Agreement
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to U.S. Bank National
Association, Minneapolis, Minnesota as trustee (the "Trustee") under the
Indenture, dated as of May 1, 1999, by and between GOAL Funding, Inc. and the
Trustee (but for the account and on behalf of GOAL Funding, Inc.), without
recourse except as provided in paragraph 8 of the Student Loan Purchase
Agreement dated as of May 1, 1999, between GOAL Funding, Inc. and Student Loan
Finance Corporation.
____________________________________ _________________________________
Title and Signature of Name of Transferor
Trustee Officer
____________________________________ _________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, ______"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement between GOAL Funding, Inc., and U.S. Bank
National Association, Minneapolis, Minnesota, as Trustee, and Financing
Statements evidencing the Trustee's security interest therein have been filed of
record in the manner provided for by 20 U.S.C. ss.1087-2(d)(3)."
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to
__________________________________________________________________________,
as trustee (the "Trustee") under the _______________, dated as
of_________________, by and between GOAL Funding, Inc. and the Trustee (but for
the account and on behalf of GOAL Funding, Inc.), without recourse except as
provided in paragraph 8 of the Student Loan Purchase Agreement dated as of May
1, 1999, between GOAL Funding, Inc. and Student Loan Finance Corporation.
____________________________________ _________________________________
Title and Signature of Name of Transferor
Trustee Officer
____________________________________ _________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, ______"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement between GOAL Funding, Inc. and
___________________________________________________________________, as
Trustee, and Financing Statements evidencing the Trustee's security interest
therein have been filed of record in the manner provided for by 20 U.S.C.
ss.1087-2(d)(3)."
Exhibit "C" to Student Loan Purchase Agreement
Representations, warranties, covenants and agreements of Seller:
A. Any information furnished by the Seller to the Corporation or its agents
(including the Servicer) with respect to any Eligible Loan to be Financed is
true, complete and correct.
B. The amount of the unpaid principal balance of each Eligible Loan to be
Financed is due and owing, and no counterclaim, offset, defense or right of
rescission exists with respect to any Eligible Loan to be Financed which could
be asserted and maintained or which, with notice, lapse of time, or the
occurrence or failure to occur of any act or event, could be asserted and
maintained, by the borrower against the Trustee as assignee of such Eligible
Loan. The Seller shall take all reasonable actions to assure that no maker of an
Eligible Loan has or may acquire a defense to the payment thereof.
C. Each Eligible Loan to be Financed has been duly executed and delivered
and constitutes the legal, valid and binding obligation of the maker (and the
endorser or co-maker) thereof, enforceable in accordance with its terms.
D. Each Eligible Loan to be Financed complies in all respects with the
requirements of the GOAL Loan Program and this Agreement and is an Eligible Loan
as that term is defined in this Agreement. If a promissory note relating to an
Eligible Loan to be Financed covers more than one loan, all loans covered
thereby are to be Financed and constitute an Eligible Loan.
E. No payment of principal or of interest with respect to any Eligible Loan
sold hereunder shall be delinquent by more than 37 days on the Loan Purchase
Date unless waived by the Corporation pursuant to Section 7.D of this Agreement.
F. The Seller is the sole owner and holder of each Eligible Loan to be
Financed and has full right and authority to sell and assign the same free and
clear of all liens, pledges or encumbrances, and no Eligible Loan to be Financed
has been pledged or assigned for any purpose.
G. Each Eligible Loan to be Financed was made in compliance with all
applicable local, state and federal laws, rules and regulations, including
without limitation all applicable nondiscrimination, truth-in-lending, consumer
credit and usury laws.
H. The Seller has, and its officers acting on its behalf have, full legal
authority to engage in the transactions contemplated by this Agreement; the
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and compliance with the terms, conditions and provisions
hereof do not and will not conflict with or result in a breach of any of the
terms, conditions or provisions of the Articles or Bylaws of the Seller or any
agreement or instrument to which the Seller is a party or by which it is bound,
or constitute a default thereunder; the Seller is not a party to or bound by any
agreement or instrument or subject to any charter or other corporate restriction
or judgment, order, writ, injunction, decree, law, rule or regulation which may
materially and adversely affect the ability of the Seller to perform its
obligations under this Agreement; this Agreement constitutes a valid and binding
obligation of the Seller enforceable against it in accordance with its terms;
and no consent, approval or authorization of any government or governmental
body, including, without limitation, the Federal Deposit Insurance Corporation,
the Comptroller of the Currency, the Board of Governors of the Federal Reserve
System, the Office of Thrift Supervision or any state bank regulatory agency, is
required in connection with the consummation of the transactions herein
contemplated.
I. The Seller is duly organized, validly existing and in good standing
under the laws of the State and has the power and authority to own its assets
and carry on its business as now being conducted.
J. The Seller and each independent servicer has exercised and shall
continue to exercise due diligence and reasonable care in making, administering,
servicing and collecting the Eligible Loans to be Financed and the Seller has
conducted a reasonable investigation of sufficient scope and content to enable
it duly to make the representations and warranties contained in this Exhibit C.
The Seller shall be solely responsible for the payment of the costs and expenses
incident to origination of the Eligible Loans, without any right of
reimbursement therefor from the Corporation.
K. In determining the need of the Eligible Borrowers for Eligible Loans, no
Eligible Loan may be made in an amount greater than the difference between the
cost of education for the relevant period and the other aid awarded for such
period, and the maximum amount of loans to any Eligible Borrower made pursuant
to the GOAL Loan Program shall not exceed the limits stated therein.
L. Each Eligible Loan shall be subject to the credit requirements of the
GOAL Loan Program.
M. At the time the Seller makes, or causes to be made, an Eligible Loan to
an Eligible Borrower, the Seller shall provide thorough and accurate loan
information to the Eligible Borrower.
Exhibit "D" to Student Loan Purchase Agreement
The assignment of the within promissory note and related documents
to____________________________________, as trustee (the"Trustee") under the
_______________________________________________________, dated as of
__________________, between GOAL Funding, Inc. and the Trustee (but for the
account and on behalf of GOAL Funding, Inc.), affixed pursuant to a Student Loan
Purchase Agreement dated as of May 1, 1999, did not become effective there under
and no rights in the same have been conveyed thereby.
Dated:____________________________
______________________________________
Title and Signature of Trustee Officer
Exhibit "E" to Student Loan Purchase Agreement
(Opinion dated as of Date of Agreement)
GOAL Funding, Inc.
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
Re: Student Loan Purchase Agreement
Dated as of May 1, 1999
Gentlemen:
Pursuant to the above mentioned Student Loan Purchase Agreement (the
"Agreement") between GOAL Funding, Inc. and Student Loan Finance Corporation
(the "Seller"), we have reviewed the Agreement and made such examinations and
further investigations as we deemed necessary as a basis for the opinions
expressed herein. All capitalized terms used in this opinion and not otherwise
defined shall have the same meanings as in the Agreement. Pursuant to Paragraph
5 of the Agreement, you have requested our opinion on a number of matters.
Opinions hereinafter expressed are qualified to the extent the validity or
enforceability of any provisions in the Agreement or the Eligible Loans or of
any rights granted to you pursuant to any of these instruments, may be subject
to or affected by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the rights of creditor generally or by general
principles of equity.
Based upon the foregoing, and having regard to legal considerations which
we deem relevant, we are of the opinion that:
(i) The Seller is duly organized and existing and in good standing under
the laws of the jurisdiction of its organization.
(ii) The Agreement has been duly authorized, executed and delivered by the
Seller, is in full force and effect and constitutes the legal, valid, binding
and enforceable obligation of the Seller.
(iii) The Seller has all requisite power and authorization under the laws
of the jurisdiction of its organization, to sell, assign and transfer the
promissory notes evidencing the Eligible Loans to the Trustee on behalf of the
Corporation, and to enter into and carry out its obligations under the
Agreement;
(iv) No authorization or approval of any governmental authority is required
for the execution and delivery of the Agreement, or the sale, transfer and
assignment of the Eligible Loans; and
(v) The officers of the Seller are authorized to execute the endorsement
required by the Agreement, transferring the Eligible Loans to be Financed.
Very truly yours
(Seller's Counsel)
EXHIBIT 10.2(d)
STUDENT LOAN FINANCE CORPORATION
STUDENT LOAN PURCHASE PROGRAM
STUDENT LOAN PURCHASE AGREEMENT
This Agreement made and entered into as of this ____ day of ________, ____,
by and between GOAL FUNDING, INC. (hereinafter referred to as the
"Corporation"), and ________________________________________________________ a
____________________________________ organized and existing under the laws of
______________________________________________________and having the principal
office at _________________________________ in the ___________ of
______________________________________________ County of
________________________________, State of ________________________ (hereinafter
referred to as the "Lender").
WITNESSETH:
WHEREAS, pursuant to the Student Loan Purchase Program of Student Loan
Finance Corporation ("SLFC") the Corporation desires to cause the purchase from
the Lender of certain loans made pursuant to the Higher Education Act and the
Lender desires to originate such loans and to sell such loans to the
Corporation's Trustee (as hereinafter defined);
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein, the parties agree as follows:
1. Definitions.
In this Agreement, the following terms shall have the following respective
meanings unless the context clearly requires otherwise:
"Eligible Loan" shall mean a Student Loan to an Eligible Borrower which:
(1) is an "eligible loan" as defined in Section 438 of the Higher Education Act
for purposes of receiving Special Allowance Payments; (2) is either Insured or
Guaranteed; and (3) bears interest at a rate per annum not less than or in
excess of the applicable rate of interest provided by the Higher Education Act
except as otherwise approved in writing by the Corporation with respect to a
lower rate.
"Indenture" shall mean the Indenture, dated as of May 1, 1999, among the
Corporation, Kitty Hawk Funding Corporation, certain financial institutions
identified therein, NationsBank, N.A., AMBAC Assurance Corporation and U.S. Bank
National Association, Minneapolis, Minnesota, or if the rights of U.S. Bank
National Association, Minneapolis, Minnesota, hereunder are assigned to a
subsequent Trustee, the Indenture under which such subsequent Trustee exercises
its authority.
"Servicer" shall mean SLFC, as servicer under the Servicing and
Administration Agreement dated as of May 1, 1999, among the Corporation, the
Trustee and SLFC, and any successor thereto in such capacity as designated in
writing by the Corporation.
"Trustee" means any trustee under an Indenture pursuant to which
Obligations are issued by the Corporation, the proceeds of which are used to
purchase loans hereunder, including U.S. Bank National Association, Minneapolis,
Minnesota, or any successor or assignee of such entity.
All capitalized terms used in this Agreement and not otherwise defined
herein shall have the meaning set forth in Exhibit "A" hereto. The term
"Agreement" shall include Exhibits "A" through "G" attached hereto.
2. Commitment and Purchase.
A. Subject to the terms and conditions and in reliance on the
representations, warranties and agreements set forth in this Agreement, the
Lender agrees to sell to the Trustee on behalf of the Corporation, and the
Corporation agrees to cause the Trustee to buy from the Lender, Eligible
Loans the Lender may choose to sell from time to time. The Eligible Loans
sold to the Trustee on behalf of the Corporation pursuant to this Agreement
shall be Eligible Loans made pursuant to the Higher Education Act, unless
the Servicer on behalf of the Corporation agrees to accept other Eligible
Loans hereunder.
B. Anything herein to the contrary notwithstanding, the Trustee on
behalf of the Corporation is not obligated to purchase and the Corporation
is not obligated to cause the purchase of Eligible Loans from the Lender
unless the gross rate of return on such Eligible Loans to the Trustee on
behalf of the Corporation or any subsequent holder would be at least equal
to the gross rate of return on loans Guaranteed under the Higher Education
Act, as currently in effect on date of execution and delivery of this
agreement, except as otherwise approved in writing by the Corporation with
respect to a lower rate.
C. The delivery of, and payment for, the Eligible Loans shall take
place at the Servicer's offices on a date or dates not later than sixty
months after the date of this Agreement, to be specified by the Servicer by
not less than fifteen days' (or such lesser number of days as shall be
acceptable to the Corporation, the Lender and the Servicer) prior written
notice (the "Loan Purchase Date").
D. The Corporation agrees to cause the Trustee to purchase the
Eligible Loans at a price equal to 100% of the outstanding unpaid principal
amount thereof on the Loan Purchase Date, plus accrued borrower interest;
provided, however, that such purchase price shall be reduced by the amount
of any accrued rebate or other obligations to the Secretary of Education or
the borrower under the Higher
Education Act with respect to such Eligible Loans which are not otherwise
provided for in this Paragraph 2.D. Following any Loan Purchase Date, the
parties agree to adjust the purchase price based on the actual payments
required to be made, to the extent the amount of such payments was not
known as of the Loan Purchase Date. The Lender shall be responsible for
reporting to the Department of Education and offsetting against interest
subsidy payments and Special Allowance Payments made to the Lender by the
Secretary of Education or otherwise paying to the Secretary of Education
the entire amount of (1) any lender origination fee which is required under
the Higher Education Act, (2) any borrower origination fees authorized to
be charged by the Higher Education Act, and (3) any other amounts due the
Secretary of Education which are offset against interest subsidy and
special allowance payments pursuant to the Higher Education Act.
E. Transfer of the Eligible Loans shall be by the means specified in
this Agreement.
F. Each Financed Eligible Loan shall have physically stamped thereon a
notice in the form set forth in Exhibit "C".
3. Representations, Warranties, Covenants and Agreements of the Lender. The
Lender hereby makes, and shall be deemed to again make as of each Loan Purchase
Date, each representation, warranty, covenant and agreement set forth in Exhibit
"D".
4. Survival of Representations and Warranties. Each representation,
warranty, certification and agreement contained in this Agreement shall survive
each Loan Purchase Date.
5. Conditions of Purchase.
The Corporation's obligation to cause the Trustee to purchase and pay for
the Eligible Loans to be Financed hereunder shall be subject to the following
conditions precedent:
A. All representations, warranties and statements by or on behalf of
the Lender contained in this Agreement shall be true on the Loan Purchase
Date.
B. Any notification to or approval by the Secretary of Education or a
Guarantor required by the Higher Education Act or a Guarantee Agreement as
a condition to the assignment of the Eligible Loans to be Financed shall
have been made or received and evidence thereof delivered to both the
Servicer and the Trustee.
C. The entire interest of the Lender in each Eligible Loan to be
Financed shall have been duly assigned by endorsement in the form set forth
in Exhibit "C", such endorsement to be without recourse except as provided
in paragraph 8.
D. Physical custody and possession of the Financed Eligible Loans
(including all information and documentation which is described in Exhibit
"B") shall be transferred in the manner directed by the Servicer.
E. The Servicer shall receive an opinion of Lender's counsel, dated as
of the date of this Agreement in substantially the form set forth in
Exhibit "G". The Servicer shall receive a Lender's Closing Certificate,
substantially in the form of Exhibit "B", when requested by the
Corporation.
F. If the promissory note relating to an Eligible Loan to be Financed
hereunder evidences more than one loan, all loans covered thereby must be
assigned hereunder and must qualify as Eligible Loans.
6. Purchase Conditional.
The Corporation's obligation to cause the Trustee to purchase Eligible
Loans pursuant to this Agreement is subject to availability of funds therefor
under the Indenture.
7. Rejection of Loans.
A. If (i) the Lender is unable to make or furnish the representations
and warranties required to be made or furnished by it pursuant to this
Agreement as to a loan, or (ii) if the Lender is unable to fulfill one or
more covenants or conditions of this Agreement as to a loan, or (iii) if
the Servicer in its reasonable judgment deems that a loan does not comply
with the terms and conditions of this Agreement or is not being delivered
in compliance with such terms and conditions, or (iv) the Servicer in its
reasonable judgment deems that a loan in repayment is for any reason
unacceptable to it, then the Servicer may, in its sole discretion, refuse
to accept and cause the Trustee to pay for such loan (or any substitute
loan offered by the Lender in lieu thereof).
B. If the Servicer rejects a loan, any such loan shall be returned to
the Lender by registered mail (for repurchase pursuant to paragraph 8 if
theretofore purchased by the Trustee on behalf of the Corporation) together
with a letter identifying each returned loan and stating the basis for its
return. Any such loan returned to the Lender which has been endorsed to the
Trustee shall be endorsed by the Trustee to the Lender in the form set
forth in Exhibit "E".
The liability of the Corporation, the Servicer and the Trustee in
connection with the loss of or damage to any loans to be returned to the Lender
hereunder shall be limited to such loss or damage occurring as a result of their
negligence or willful misconduct in handling or safekeeping such loans.
C. If the Servicer rejects a loan, the Lender may substitute a
different Eligible Loan for the rejected loan, provided, however, that the
terms and conditions of such Eligible Loan are acceptable to the Servicer.
D. If at the Loan Purchase Date any Eligible Loan to be Financed is
more than 37 days delinquent with respect to any payment of principal or
interest, the Servicer may elect to cause the Trustee to purchase such
Eligible Loan and allow the Lender 15 days from the Loan Purchase Date
within which to cause such delinquency to be cured. If the delinquency
cannot be so cured, such Financed Eligible Loan shall be subject to
repurchase pursuant to Paragraph 8.
8. Repurchase Obligation.
If:
(i) any representation or warranty made or furnished by the Lender in
or pursuant to this Agreement shall prove to have been materially
incorrect;
(ii) the Secretary of Education or a Guarantor, as the case may be,
refuses to honor all or part of a claim filed with respect to a loan sold
to the Trustee on behalf of the Corporation pursuant to this Agreement
(including any claim for Special Allowance Payments, interest subsidy
payments, reinsurance and guarantee payments) on account of any
circumstances or event that occurred prior to the sale of such loan to the
Trustee on behalf of the Corporation;
(iii) on account of any circumstances or event that occurred prior to
the sale of a loan to the Trustee on behalf of the Corporation pursuant to
this Agreement, a defense is asserted by a maker (or endorser, if any) of
such loan with respect to his obligation to pay all or any part of such
loan and the Servicer in good faith believes that the facts reported, if
true, raise a reasonable doubt as to the legal enforceability of such loan;
or
(iv) a Financed Student Loan is required to be repurchased pursuant to
paragraph 7.B or 7.D,;
then the Lender shall repurchase such loan upon the Servicer's or Trustee's
request by paying to the Trustee, for the account of the Corporation, the then
outstanding principal balance of such loan (or such greater amount as may be
necessary to make the Corporation and the Trustee whole in light of the purchase
price originally paid by the Trustee for such loan), plus interest and Special
Allowance Payments accrued and unpaid with respect to such loan from the Loan
Purchase Date to and including the date of repurchase, plus any attorneys' fees,
legal expenses, court costs, servicing fees or other expenses incurred by the
Corporation, the Servicer and the Trustee in connection with such loan.
9. Notification to Borrowers.
The Lender and the Corporation agree that the Servicer and the Lender shall
either jointly or separately notify each borrower under the Financed Eligible
Loans of the assignment and transfer to the Trustee (but for the account and on
behalf of the Corporation) of the Lender's interest in such Financed Eligible
Loans and direct each borrower to make all payments thereon directly to the
Servicer until otherwise notified by the Trustee. Such notice shall be in
compliance with Section 428(b)(2)(F) of the Higher Education Act.
10. Obligations to Forward Payments and Communications.
A. The Lender shall promptly remit, or cause to be remitted, to the
Trustee as the Servicer may direct, all funds received by the Lender after
the Loan Purchase Date which constitute payments of principal, or interest
or Special Allowance Payments accrued after the Loan Purchase Date, with
respect to any Financed Eligible Loan.
B. The Lender shall immediately transmit to the Servicer any
communication received by the Lender after the Loan Purchase Date with
respect to a Financed Eligible Loan or the borrower under such a Financed
Eligible Loan. Such communication shall include, but not be limited to,
letters, notices of death or disability, adjudications of bankruptcy and
similar documents, and forms requesting deferment of repayment or loan
cancellations.
11. Payment of Expenses and Taxes.
Except as specifically provided herein, each party to this Agreement shall
pay its own expenses incurred in connection with the preparation, execution and
delivery of this Agreement and the transactions herein contemplated, including,
but not limited to, the fees and disbursements of counsel, provided, however,
that the Lender shall pay any transfer or other taxes and recording or filing
fees payable in connection with the sale and purchase of the Eligible Loans to
be Financed.
12. lndemnification.
The Lender specifically acknowledges that the Corporation will be making
representations and warranties regarding the Eligible Loans to be Financed as
part of the proposed offering of Obligations of the Corporation (including
without limitation Obligations to be issued under the Indenture) based in part
on the accuracy of the Lender's representations and warranties in this
Agreement. The Lender agrees to indemnify and save the Trustee and the
Corporation harmless of, from and against any and all loss, cost, damage or
expense, including reasonable attorneys' fees, incurred by reason of any breach
of the Lender's warranties or representations hereunder or any false or
misleading representations of the Lender or any failure to disclose any matter
which makes the warranties and representations herein misleading or any
inaccuracy in any information furnished by the Lender in connection herewith.
13. Other Provisions.
A. The Lender shall furnish to the Servicer such additional
information concerning the Lender's student loan portfolio as the Servicer
may reasonably request.
B. The Lender shall, at its expense, execute all other documents and
take all other steps as may be requested by the Servicer or the Trustee
from time to time to effect the sale hereunder of the Eligible Loans to be
purchased by the Trustee on behalf of the Corporation.
C. The provisions of this Agreement cannot be waived or modified
unless such waiver or modification be in writing and signed by the parties
hereto and the Trustee. Inaction or failure to demand strict performance
shall not be deemed a waiver.
D. This Agreement shall be governed by the laws of the State.
E. All covenants and agreements herein contained shall extend to and
be obligatory upon all successors of the respective parties hereto.
F. This Agreement may be simultaneously executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
G. If any provision of this Agreement shall be held, or deemed to be
or shall, in fact, be inoperative or unenforceable as applied in any
particular situation, such circumstance shall not have the effect of
rendering the provision in question inoperative or unenforceable in any
other situation, or of rendering any other provision or provisions herein
contained invalid, inoperative or unenforceable to any extent whatsoever.
The invalidity of any one or more phrases, sentences, clauses or paragraphs
herein contained shall not affect the remaining portions of this Agreement
or any part hereof.
H. All notices, requests, demands or other instruments which may or
are required to be given by either party to the other or to the Trustee or
the Servicer, shall be in writing and each shall be deemed to have been
properly given when served personally on an officer of the party to whom
such notice is to be given, or upon expiration of a period of 48 hours from
and after the postmark thereof when mailed postage prepaid by registered or
certified mail, requesting return receipt, addressed as follows:
If intended for the Corporation or the Servicer:
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
If intended for the Lender:
If intended for the Trustee:
U.S. Bank National Association
Post Office Box 1308
141 North Main Avenue, Suite 300
Sioux Falls, South Dakota 57117-1308
Either party, the Servicer or the Trustee may change the address and name
of the addressee to which subsequent notices are to be sent to it, by notice to
the others given as aforesaid, but any such notice of change, if sent by mail,
shall not be effective until the fifth day after it is mailed.
I. This Agreement may not be terminated by either party hereto except
in the manner and with the effect herein specifically provided for.
J. Time is of the essence in this Agreement.
K. This Agreement shall not be assignable by the Lender, in whole or
in part, without the prior written consent of the Corporation and the
Trustee.
L. No remedy by the terms of this Agreement conferred upon or reserved
to the Trustee or the Corporation is intended to be exclusive of any other
remedy, but each and every such remedy shall be cumulative and in addition
to every other remedy given under this Agreement or existing at law or in
equity (including, without limitation, the right to such equitable relief
by way of injunction), or by statute on or after the date of this
Agreement.
M. This Agreement has been made and entered into not only for the
benefit of the Lender and the Corporation but also for the benefit of the
Trustee and all holders of Obligations issued for the purpose of Financing
Eligible Loans and any other assignee of loans purchased hereunder
(including any trustee for holders of bonds, notes or other evidences of
indebtedness issued by the Corporation to refinance such loans), and its
provisions may be enforced not only by the parties to this Agreement but
also by the Trustee or such other assignee.
14. Non-Petition Covenant.
The Lender, by entering into this Agreement, covenants and agrees that it
shall not at any time petition or otherwise invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
the Corporation under any federal or state bankruptcy, insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Corporation or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Corporation, in connection with any obligation relating to this Agreement.
IN WITNESS WHEREOF, The parties have hereunto set their hands and seals as
of the day and year first above written.
GOAL FUNDING, INC.GOAL FUNDING, INC.
_________________________________
Name of Lender
By__________________________________ By_______________________________
Title:_____________________ Title:__________________
ATTEST:
_________________________________
Title:__________________
(Seal)
Exhibit "A" to Student Loan Purchase Agreement
DEFINITIONS
1.00 Terms
1.01 "Certificate of Insurance" shall mean a certificate of federal loan
insurance issued with respect to an Insured Eligible Loan by the Secretary of
Education pursuant to the provisions of the Higher Education Act.
1.02 "Eligible Borrower" shall mean a borrower who is eligible under the
Higher Education Act to be the obligor of a loan for financing a program of
post-secondary education for an Eligible Student as described in Section 1.32.
1.03 "Federal Reimbursement Contract" means an agreement between a
Guarantor and the Secretary of Education providing for the payment by the
Secretary of Education of amounts authorized to be paid pursuant to the Higher
Education Act, including reimbursement amounts paid or payable upon defaulted
Financed Eligible Loans and other student loans guaranteed or insured by the
Guarantor and providing for interest subsidy payments to holders of qualifying
student loans guaranteed or insured by the Guarantor.
1.04 "Financed", in the case of Eligible Loans and Student Loans generally,
shall mean those acquired by the Trustee on behalf of the Corporation with
moneys derived from any of the funds or accounts established by the Indenture;
and where the context so permits or requires such usage, shall mean those
specific Eligible Loans so acquired by the Trustee on behalf of the Corporation
from the Lender pursuant to this Agreement, inclusive of the promissory notes
evidencing such Eligible Loans or Student Loans and the related documentation in
connection with each thereof.
1.05 "Guarantee" or "Guaranteed" shall mean, with respect to a Student
Loan, the insurance or guarantee by a Guarantor, to the extent provided in the
Higher Education Act, of the principal of and accrued interest on such Student
Loan and the coverage of such Student Loan by (1) the Federal Reimbursement
Contracts providing, among other things, for reimbursement by the Secretary of
Education to such Guarantor for losses incurred by it on defaulted Financed
Eligible Loans insured or guaranteed by such Guarantor to the extent provided in
the Higher Education Act and (2) any guarantee fund established by the
Guarantor, prior to the termination of such guarantee fund.
1.06 "Guarantee Agreement" means an agreement between a Guarantor and
either the Trustee or the Lender providing for the insurance or guarantee by
such Guarantor, to the extent provided in the Higher Education Act, of the
principal of and accrued interest on loans to Eligible Borrowers made or
acquired by the Corporation or the Lender from time to time.
1.07 "Guarantee Program" means a Guarantor's loan insurance program
pursuant to which such Guarantor guarantees or insures loans to Eligible
Borrowers.
1.08 "Guaranteed Loans" means loans that are Guaranteed.
1.09 "Guarantor" shall mean Education Assistance Corporation, Great Lakes
Higher Education Corporation, Pennsylvania Higher Education Assistance Agency,
United Student Aid Funds, Inc., Student Loans of North Dakota, Education Credit
Management Corporation, Iowa College Student Aid Commission, California Student
Aid Commission, Missouri Coordinating Board for Higher Education, Illinois
Student Assistance Commission, Northwest Education Loan Association, Oregon
State Scholarship Commission, or other guarantor permitted under the Indenture;
provided, however, that any such Guarantor must be a permitted guarantor under
the Indenture as of the Loan Purchase Date.
1.10 "Higher Education Act" shall mean the Higher Education Act of 1965, as
amended or supplemented from time to time, and all regulations promulgated
thereunder.
1.11 "Insurance" or "Insured" or "Insuring" means, with respect to a loan
to an Eligible Borrower, the insuring by the Secretary of Education (as
evidenced by a Certificate of Insurance or other document or certification
issued under the provisions of the Higher Education Act) under the Higher
Education Act, of 100% of the principal of and accrued interest on such loan.
1.12 "Insured Loans" means loans which are Insured.
1.13 "Lender" shall mean any "eligible lender", as defined in the Higher
Education Act, permitted to participate as a seller of Student Loans to the
Corporation under the Program and which has received an eligible lender
designation from the Secretary of Education with respect to Insured Loans or
from the applicable Guarantor with respect to Guaranteed Loans.
1.14 "Loan Purchase Date" has the meaning assigned thereto in Section 2.C.
of this Agreement.
1.15 "Obligations" shall mean all notes, bonds or other obligations of the
Corporation issued pursuant to the applicable indenture to finance or refinance
the purchase of student loans or for other purposes authorized by the applicable
Indenture.
1.16 "Program" shall mean SLFC's Eligible Loan acquisition program with
respect to Financed Eligible Loans under which the Corporation will cause the
Trustee to acquire Eligible Loans from Lenders in order to increase the supply
of moneys available for new loans to assist students in obtaining a
post-secondary education.
1.17 "Secretary of Education" shall mean the Commissioner of Education,
Department of Health, Education and Welfare of the United States, and the
Secretary of the United States Department of Education (who succeeded to the
functions of the Commissioner of Education pursuant to the Department of
Education Organization Act), or any other officer, board, body, commission or
agency succeeding to the functions thereof under the Higher Education Act.
1.18 "Special Allowance Payments" shall mean special allowance payments
authorized to be made by the Secretary of Education pursuant to Section 438 of
the Higher Education Act, or similar allowances authorized from time to time by
federal law or regulation.
1.19 "Student Loan Purchase Agreement" or "Loan Purchase Contract" means an
agreement between the Corporation and a lender providing for the sale by the
lender to the Trustee on behalf of the Corporation of Eligible Loans within the
time specified in such agreement.
1.20 "State" shall mean the State of South Dakota.
1.21 "Student Loans" shall mean loans to Eligible Borrowers for
post-secondary education.
1.30 Eligible Students
1.31 An Eligible Student is any student who
(a) is accepted for enrollment or is enrolled at least half-time at an
Eligible Institution and is in good standing and making satisfactory
progress in a prescribed course of study; and
(b) is a U.S. citizen or permanent resident, except that aliens, even
with immigrant or permanent resident status, are not Eligible Students if
enrolled in institutions located abroad; and
(c) does not, at the time of application for the loan, owe a refund on
a federally funded grant awarded by the institution, and has never
defaulted, and is not then in default, on a national direct or guaranteed
loan.
1.32 A prescribed course of study shall be and include an academic workload
sufficient to secure a degree or certificate in the period normally taken
therefor as determined by the institution and approved by the Servicer;
provided, however, that in no event shall such approval be given for a workload
of less than one-half the normal requirement.
1.40 Eligible Institutions
1.41 Eligible lnstitutions shall mean those institutions which satisfy the
definition of an "eligible educational institution" under the Higher Education
Act and the regulations of the applicable Guarantor. In all cases, a basic
requirement is approval by the Secretary of Education as an eligible institution
under the Higher Education Act and approval by the Secretary of Education for
civil rights compliance.
Exhibit "B" to Student Loan Purchase Agreement
LENDER'S CLOSING CERTIFICATE
_________________________________ (the "Lender") does hereby certify that all
representations, warranties and statements by or on behalf of the undersigned
contained in a certain Student Loan Purchase Agreement by and between the Lender
and GOAL Funding, Inc. dated as of _______________________________(the
"Agreement"), are true and correct on and as of the date hereof, without
exception or qualification whatsoever;
FURTHERMORE, the Lender does hereby certify that the following documents,
where applicable to each Eligible Loan Financed under the Agreement, have
heretofore been furnished to the Corporation pursuant to paragraph 5.D. of the
Agreement:
Department of Education or Guarantor application, as supplemented
Interim note(s), if applicable Payout note(s), if applicable Evidence
of disbursement Disclosure statement
Certificate of Insurance and contract of insurance (or a certified copy
thereof) with respect to each Insured Loan or notification of loan
approval by Guarantor, with respect to each Guaranteed Loan (or a
certified copy thereof)
Guarantee Agreement and Agreement for Participation in the Guaranteed
Loan Program (or a certified copy thereof) with respect to each
Guaranteed Loan
Any other documentation held by the Lender relating to the history of
such Eligible Loan
Secretary of Education or Guarantor Loan Transfer Statement
Uniform Commercial Code financing statement, if any, securing any
interest in an Eligible Loan to be Financed, and an executed
termination statement related thereto
FURTHERMORE, the Lender does hereby certify that it has in its possession
evidence of loan disbursement for each Eligible Loan, and does hereby warrant
that it will maintain such evidence throughout the term of each such Eligible
Loan and will provide a copy thereof to the Servicer and the Trustee upon
request
Any term capitalized but not defined in the Certificate shall have the
meaning ascribed thereto in the Agreement.
IN WITNESS WHEREOF, the undersigned has caused this Certificate to be
executed and delivered by its officers thereunto duly authorized this
______________, day of _____________________________, ______.
_________________________________
Name of Lender
By_______________________________
Title:___________________
ATTEST:
____________________________________
Title:______________________________
(Seal)
Exhibit "C" to Student Loan Purchase Agreement
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to U.S. Bank National
Association, Minneapolis, Minnesota as trustee (the "Trustee") under the
Indenture, dated as of May 1, 1999, by and among GOAL Funding, Inc., Kitty Hawk
Funding Corporation, certain financial institutions identified therein,
NationsBank, N.A., AMBAC Assurance Corporation and the Trustee (but for the
account and on behalf of GOAL Funding, Inc.), without recourse except as
provided in paragraph 8 of the Student Loan Purchase Agreement dated as of ,
between GOAL Funding, Inc. and ______________________.
____________________________________ _________________________________
Title and Signature of Name of Transferor
Trustee Officer
____________________________________ _________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, ______"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement among GOAL Funding, Inc., Kitty Hawk Funding
Corporation, certain financial institutions identified therein, NationsBank,
N.A., AMBAC Assurance Corporation and U.S. Bank National Association,
Minneapolis, Minnesota, as Trustee, and Financing Statements evidencing the
Trustee's security interest therein have been filed of record in the manner
provided for by 20 U.S.C. ss.1087-2(d)(3)."
ENDORSEMENT
"All right, title and interest of the undersigned in and to the within
promissory note and related documents is hereby assigned to
_________________________________________________________________________,
as trustee (the "Trustee") under the _______________, dated as
of_________________, by and among GOAL Funding, Inc., Kitty Hawk Funding
Corporation, certain financial institutions identified therein, NationsBank,
N.A., AMBAC Assurance Corporation and the Trustee (but for the account and on
behalf of GOAL Funding, Inc.), without recourse except as provided in paragraph
8 of the Student Loan Purchase Agreement dated as of
, between GOAL Funding, Inc. and
____________________________________________________________.
____________________________________ _________________________________
Title and Signature of Name of Transferor
Trustee Officer
____________________________________ _________________________________
Title and Signature of Title and Signature of
Corporation Officer Transferor Officer
Dated:_____________________________, ______"
NOTICE
"The within note and related documentation is subject to a Uniform
Commercial Code Security Agreement among GOAL Funding, Inc.,
_________________________________ and ________________________________, as
Trustee, and Financing Statements evidencing the Trustee's security interest
therein have been filed of record in the manner provided for by 20 U.S.C.
ss.1087-2(d)(3)."
Exhibit "D" to Student Loan Purchase Agreement
Representations, warranties, covenants and agreements of Lender:
A. Any information furnished by the Lender to the Corporation or its agents
(including the Servicer) with respect to any Eligible Loan to be Financed is
true, complete and correct.
B. The amount of the unpaid principal balance of each Eligible Loan to be
Financed is due and owing, and no counterclaim, offset, defense or right of
rescission exists with respect to any Eligible Loan to be Financed which could
be asserted and maintained or which, with notice, lapse of time, or the
occurrence or failure to occur of any act or event, could be asserted and
maintained, by the borrower against the Trustee as assignee of such Eligible
Loan. The Lender shall take all reasonable actions to assure that no maker of an
Eligible Loan has or may acquire a defense to the payment thereof. No Eligible
Loan to be Financed carries a rate of interest less than or in excess of the
applicable rate provided by the provisions of the Higher Education Act, except
as previously approved in writing by the Corporation with respect to a lower
rate of interest.
C. Each Eligible Loan to be Financed has been duly executed and delivered
and constitutes the legal, valid and binding obligation of the maker (and the
endorser or co-maker) thereof, enforceable in accordance with its terms.
D. Each Eligible Loan to be Financed complies in all respects with the
requirements of the Higher Education Act and this Agreement and is an Eligible
Loan as that term is defined in this Agreement. If a promissory note relating to
an Eligible Loan to be Financed covers more than one loan, all loans covered
thereby are to be Financed and constitute an Eligible Loan.
E. The Lender has applied for and received the Guarantor's or Secretary's
designation, as the case may be, as an "eligible lender" under the Higher
Education Act. No payment of principal or of interest with respect to any
Eligible Loan sold hereunder shall be delinquent by more than 37 days on the
Loan Purchase Date unless waived by the Servicer pursuant to Section 7.D. of
this Agreement.
F. The Lender is the sole owner and holder of each Eligible Loan to be
Financed and has full right and authority to sell and assign the same free and
clear of all liens, pledges or encumbrances, and no Eligible Loan to be Financed
has been pledged or assigned for any purpose.
G. Each Eligible Loan to be Financed is either insured by the Secretary or
guaranteed by a Guarantor as to 98% of the principal and interest on the
Eligible Loan; such Insurance or Guarantee, as the case may be, is in full force
and effect, and is freely transferable as an incident to the sale of each
Eligible Loan to be Financed; all premiums due and payable to the Guarantor have
been or will be paid in full by the Lender; and none of the Eligible Loans to be
Financed has at any time been tendered to the Secretary or the Guarantor for
payment and rejected unless the situation giving rise to such rejection has been
cured.
H. There are no circumstances or conditions with respect to any Eligible
Loan to be Financed, the borrower thereunder or the creditworthiness of said
borrower that would reasonably cause prudent private investors to regard any of
the Eligible Loans to be Financed as an unacceptable investment, or adversely
affect the value or marketability thereof or the guarantee thereof.
I. Each Eligible Loan to be Financed was made in compliance with all
applicable local, state and federal laws, rules and regulations, including
without limitation all applicable nondiscrimination, truth-in-lending, consumer
credit and usury laws.
J. The Lender has, and its officers acting on its behalf have, full legal
authority to engage in the transactions contemplated by this Agreement; the
execution and delivery of this Agreement, the consummation of the transactions
herein contemplated and compliance with the terms, conditions and provisions
hereof do not and will not conflict with or result in a breach of any of the
terms, conditions or provisions of the Charter, Articles or Bylaws of the Lender
or any agreement or instrument to which the Lender is a party or by which it is
bound, or constitute a default thereunder; the Lender is not a party to or bound
by any agreement or instrument or subject to any charter or other corporate
restriction or judgment, order, writ, injunction, decree, law, rule or
regulation which may materially and adversely affect the ability of the Lender
to perform its obligations under this Agreement; this Agreement constitutes a
valid and binding obligation of the Lender enforceable against it in accordance
with its terms; and no consent, approval or authorization of any government or
governmental body, including, without limitation, the Federal Deposit Insurance
Corporation, the Comptroller of the Currency, the Board of Governors of the
Federal Reserve System, the Office of Thrift Supervision or any state bank
regulatory agency, is required in connection with the consummation of the
transactions herein contemplated.
K. The Lender is duly organized, validly existing and in good standing
under the laws of its applicable jurisdiction and has the power and authority to
own its assets and carry on its business as now being conducted.
L. The Lender and each independent servicer has exercised and shall
continue to exercise due diligence and reasonable care in making, administering,
servicing and collecting the Eligible Loans to be Financed and the Lender has
conducted a reasonable investigation of sufficient scope and content to enable
it duly to make the representations and warranties contained in this Exhibit D.
The Lender shall be solely responsible for the payment of the costs and expenses
incident to origination of the Eligible Loans, without any right of
reimbursement therefor from the Corporation. With respect to all Guaranteed
Loans being acquired, a Guarantee Agreement is in effect with respect thereto
and is valid and binding upon the parties thereto in all respects material to
the security of the Obligations, and the Lender is not in default in the
performance of any of its covenants and agreements made in such Guarantee
Agreement.
M. The Lender shall notify the borrower of the sale in the manner provided
in the Higher Education Act.
N. In determining the need of the Eligible Borrowers for Eligible Loans, no
Eligible Loan may be made in an amount greater than the difference between the
cost of education for the relevant period and the other aid awarded for such
period, and the maximum amount of loans to any Eligible Borrower made pursuant
to the Higher Education Act shall not exceed the limits stated therein.
O. Each Eligible Loan made pursuant to Section 428B of the Higher Education
Act shall be subject to the credit requirements as determined by the Lender and
the Guarantor, which may include but are not necessarily limited to those
described in Exhibit F to this Loan Purchase Agreement.
P. At the time a Lender makes an Eligible Loan to an Eligible Borrower, the
Lender shall provide thorough and accurate loan information to the Eligible
Borrower, which shall include all information required to be provided to an
Eligible Borrower pursuant to Section 433 of the Higher Education Act and any
other information that a lender is required to provide an Eligible Borrower by
the Guarantor or the Secretary of Education.
Exhibit "E" to Student Loan Purchase Agreement
The assignment of the within promissory note and related documents
to____________________________________, as trustee (the"Trustee") under the
_______________________________________________________, dated as of
__________________, among GOAL Funding, Inc., ___________________and the Trustee
(but for the account and on behalf of GOAL Funding, Inc.), affixed pursuant to a
Student Loan Purchase Agreement dated as of , did not become effective there
under and no rights in the same have been conveyed thereby.
Dated:____________________________
______________________________________
Title and Signature of Trustee Officer
Exhibit "F" to Student Loan Purchase Agreement
ADVERSE CREDIT FOR DETERMINING FEDERAL PLUS LOAN ELIGIBILITY
The lender must obtain a credit history of the parent applicant from at
least one national credit bureau organization. This credit report must be
secured within a time frame that ensures the most accurate, current
representation of the applicant's credit history before the first day of the
period of enrollment for which the loan is intended. When reviewing the credit
report, unless the lender determines that an extenuating circumstance exists,
the lender should consider an applicant to have an adverse credit history if any
of the following conditions are evidenced by the credit report:
1. The applicant(s), on the date of the lender's examination of the credit
report, is considered 90 days or more delinquent on the repayment of any
debt; or
2. The applicant(s) have been the subject of a default determination (on any
debt), foreclosure, repossession, tax lien, wage garnishment or write-off
of a Title IV debt during the five years preceding the date of the credit
report; provided that the failure to pay a debt that has been discharged in
bankruptcy or that is dischargeable in a pending bankruptcy proceeding
shall not be deemed an adverse credit history.
If one of these conditions exists, the lender may still make the loan if
the lender determines, and documents in the file, that extenuating circumstances
exist. The documentation of extenuating circumstances may include, but is not
limited to:
1. an updated credit report that shows the applicant is no longer 90 or more
days delinquent on a debt or corrects other information found on the
original credit report examined by the lender that led to the determination
of adverse credit;
2. a statement from the creditor that the applicant has made satisfactory
arrangements to repay the debt(s) that is the basis of the adverse credit
determination;
3. in the case of a debt with an outstanding balance that is less than $500
but is 90 days or more delinquent, a satisfactory written explanation from
the applicant explaining the reason for the delinquency; or
4. evidence that the debt that is the basis of the adverse credit
determination has been discharged in bankruptcy or is dischargeable in
pending bankruptcy proceedings.
A lender may have stricter standards for determining adverse credit than
those outlined above.
Exhibit "G" to Student Loan Purchase Agreement
(Opinion dated as of Date of Agreement)
GOAL Funding, Inc.
Student Loan Finance Corporation
000 Xxxxx Xxxxxx Xxxxxxxxx
Xxxxxxxx, Xxxxx Xxxxxx 00000
Re: Student Loan Purchase Agreement
Dated as of
Gentlemen:
Pursuant to the above mentioned Student Loan Purchase Agreement (the
"Agreement") between GOAL Funding, Inc. and _________________________________
(the "Lender"), we have reviewed the Agreement and made such examinations and
further investigations as we deemed necessary as a basis for the opinions
expressed herein. All capitalized terms used in this opinion and not otherwise
defined shall have the same meanings as in the Agreement. Pursuant to Paragraph
5 of the Agreement, you have requested our opinion on a number of matters.
Opinions hereinafter expressed are qualified to the extent the validity or
enforceability of any provisions in the Agreement or the Eligible Loans or of
any rights granted to you pursuant to any of these instruments, may be subject
to or affected by applicable bankruptcy, insolvency, reorganization, moratorium
or similar laws affecting the rights of creditor generally or by general
principles of equity.
Based upon the foregoing, and having regard to legal considerations which
we deem relevant, we are of the opinion that:
(i) The Lender is duly organized and existing and in good standing under
the laws of the jurisdiction of its organization.
(ii) The Agreement has been duly authorized, executed and delivered by the
Lender, is in full force and effect and constitutes the legal, valid, binding
and enforceable obligation of the Lender.
(iii) The Lender has all requisite power and authorization under the laws
of the jurisdiction of its organization, to sell, assign and transfer the
promissory notes evidencing the Eligible Loans to the Corporation or to the
Trustee on behalf of the Corporation, and to enter into and carry out its
obligations under the Agreement;
(iv) No authorization or approval of any governmental authority (other than
notice to the Secretary of Education and approval of the Guarantor for the sale
of the Eligible Loans) is required for the execution and delivery of the
Agreement, or the sale, transfer and assignment of the Eligible Loans;
(v) The officers of the Lender are authorized to execute the endorsement
required by the Agreement, transferring the Eligible Loans to be Financed; and
(vi) With respect to all Financed Guaranteed Eligible Loans, the applicable
Guarantee Agreement has been duly authorized, executed and delivered by the
Lender and is in full force and effect, and with respect to all Financed Insured
Eligible Loans the applicable insurance is in full force and effect.
Very truly yours
(Lender's Counsel)
