EXHIBIT 99.1
SERVICING AGREEMENT
THIS SERVICING AGREEMENT entered into and effective as of the first day
of April, 2004, by and between Nelnet, Inc., a Nebraska corporation, Aurora,
Colorado, herein referred to as "Servicer", and Nelnet Education Loan Funding,
Inc., a Nebraska corporation, herein referred to as "Lender".
WHEREAS, Servicer is in the loan servicing business in the State of
Colorado, and in the ordinary course of such business has processed and serviced
loans to student/parent borrowers (the "Education Loans") which are made and
guaranteed in accordance with the provisions of the Higher Education Act of
1965, as amended (the "Education Act") (references hereinafter to the "Education
Act" include rules and regulations promulgated thereunder as in effect from time
to time); and
WHEREAS, Servicer has developed and/or has available to it the systems
and services to enable it to process and service Education Loans in accordance
with the Education Act, and the requirements of those Guarantee Agencies as
mutually agreed to by the parties ("Guarantor(s)"); and
WHEREAS, Servicer has developed and/or has available to it the systems
and services to enable it to process and service Education Loans in accordance
with the Rules and Regulations (the "Regulations") promulgated by Guarantor
(references hereinafter to the "Regulations" include Rules and Regulations
promulgated thereunder as in effect from time to time); and
WHEREAS, Lender, in the ordinary course of its business, finances
Education Loans pursuant to the terms of the Indenture of Trust dated as of
April 1, 2004 (as amended, the "Indenture"), among Lender and Xxxxx Fargo Bank,
National Association as eligible lender trustee and indenture trustee (the
"Trustee"); and
WHEREAS, Lender desires to retain Servicer to process and service
Education Loans beneficially owned by Lender, legal title to which is held by
the Trustee.
NOW THEREFORE, in consideration of the premises and the mutual covenants
hereinafter set forth, the parties agree as follows:
1. DEFINITIONS. Capitalized terms which are not otherwise defined in
this Agreement shall have the meanings ascribed thereto in the Indenture.
2. TERM.
2.1 The term of the Agreement shall continue until the earlier of (i)
termination of the Indenture, (ii) early termination after material default by
the Servicer provided in Section 16 of this Agreement, or (iii) the Education
Loans serviced under this Agreement are paid in full.
2.2 Upon the termination of this Agreement, Servicer shall turn over to
Lender all Education Loan files complete with all information contained therein
and all current computer information on the Education Loans under service
pursuant to this Agreement in such form or fashion as Lender shall reasonably
specify. Servicer and Lender specifically agree that the format used to transfer
Lender's data contains confidential and proprietary trade secret information
which is the exclusive property of Servicer. Servicer makes no claim to the
specific data contained in any printout given to Lender and recognizes that said
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data is the exclusive property of Lender. Servicer and Lender agree, however,
that all aspects of the underlying computer program, algorithms, methods of
processing, specific design and layout, report format, and the unique processing
techniques and interactions of the various aspects of Servicer's computer
program are trade secrets of, proprietary to, and owned exclusively by Servicer.
At such deconversion, a minimum fee of $12.00 per account plus any other
reasonable expenses incurred in connection with the transfer of such files and
other information shall be paid by Lender. The confidentiality provisions of
this paragraph shall survive any termination or expiration of this Agreement.
3. DELIVERY OF COMPLETED EDUCATION LOANS FOR SERVICING AND COLLECTION.
Subject to Servicer's scheduling requirements, Lender may from time to time
deliver or cause to be delivered to Servicer Education Loans with respect to
which loan processing has been completed and loan proceeds have been disbursed
to the student/parent borrowers prior to the date of delivery ("Completed
Education Loans") to Servicer to be serviced pursuant to the terms of this
Agreement. Lender shall transmit to Servicer all such loan documentation as
required by Servicer to enable it to service the Completed Education Loans as
provided herein.
4. SERVICING OF COMPLETED EDUCATION LOANS. Upon acceptance of any
Completed Education Loan into Servicer's computer system and after the sale date
(if applicable) of the Completed Education Loan to Lender, Servicer shall
service such Education Loan in accordance with the Education Act, the
Regulations, and in accordance with the provisions of this Agreement, including
the following:
(a) Servicer shall take all steps necessary to maintain the insurance
or guaranty on Education Loans in full force at all times.
(b) Servicer shall prepare and mail directly to the student/parent
borrower all required statements, notices, disclosures and
demands.
(c) Servicer shall retain records of contacts, follow-ups, collection
efforts and correspondence regarding each Education Loan.
(d) Servicer shall provide accounting for all transactions related to
individual Education Loans, including, but not limited to,
accounting for all payments of principal and interest upon such
Education Loans.
(e) Servicer shall process all deferments and forbearances.
(f) Servicer shall process all address changes and update address
changes accordingly.
(g) Servicer shall retain all documents received by Servicer
pertaining to each Education Loan.
(h) When necessary and allowable by the Education Act, Servicer shall
take all steps necessary to file a claim for loss with Guarantor,
and shall be responsible for all communication and contact with
that agency necessary or appropriate to accomplish the same.
(i) Servicer shall provide a Lender's Manifest of Education Loans on
all new accounts, accounts paid in full or converted to
repayment, and provide any other information required by
Guarantor.
(j) Servicer shall provide such other services as Servicer
customarily provides and deems appropriate.
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5. ADDITIONAL SERVICING ACTIVITIES. At Lender's request Servicer agrees
to perform additional servicing activities not required under the terms of this
Agreement for those Education Loans transferred to Servicer as Completed
Education Loans which have not been previously serviced in accordance with the
Education Act and Regulations, and which require additional servicing activity
to attempt to maintain or reinstate the loans' principal and interest guarantee
from the Guarantor ("Cure Procedures"). Servicer, utilizing Cure Procedures
approved by the Guarantor, will use its best efforts to cure all defects caused
by Lender. Servicer makes no representation or warranty that the guarantee on
each Education Loan will be reinstated regardless of Servicer following the Cure
Procedures as approved by the Guarantor. Lender agrees to pay Servicer those
fees for Cure Services described in Schedule A under the topic entitled
"Additional Servicing Activity".
6. PORTFOLIOS SUBJECT TO REJECTION BY SERVICER. Lender acknowledges that
certain loan portfolio types pose a risk of financial hardship for Servicer to
service under this Agreement. Servicer may in its discretion, prior to placing
such loans in the Servicer system, reject certain loans or loan portfolios
("Rejected Loans"). Servicer shall provide Lender with reasonable advance notice
as to any Rejected Loans which Servicer declines to place on its system.
Servicer shall have no right to reject or decline loans after the loans are
transferred to the Servicer system.
7. REPORTS TO LENDER. On or before the 15th day of each month, unless
some other time is provided herein, Servicer shall prepare and deliver to
Lender, or to such other person as Lender may designate, the following reports
with respect to activity during the preceding month:
(a) As of the last day of each month, an unaudited statement, in
reasonable detail, of all transactions during that month on
Completed Education Loans serviced by Servicer for Lender;
(b) Processing Status Report (daily);
(c) Check Register (daily);
(d) Posting Ledger (daily/monthly);
(e) Statistical Report (monthly);
(f) Loan Ledger/Alpha Report (monthly);
(g) Guarantor Manifest (monthly);
(h) Delinquency Report (daily/monthly);
(i) Claims Activity Report (monthly).
Lender shall receive at no cost one copy of each of the foregoing
reports. Servicer will provide extra copies at the request of Lender. Lender
shall reimburse Servicer its cost in producing such extra copies.
8. INTEREST COMPUTATION. Servicer shall provide on a quarterly basis
statistical data for the computation of interest and special allowance billable
to the U.S. Department of Education for Lender's Education Loans. Data will be
computed commencing with the date Education Loans appear on the records of
Servicer.
9. SERVICE FEE TO SERVICER. Lender shall pay to Servicer, on or before
the 15th day of each month, or within fifteen (15) days of billing statement,
for and in consideration of the services performed by Servicer hereunder for the
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preceding month, the fee provided for in Schedule A of this Agreement
("Servicing Fee"). The Servicing Fee shall be subject to change every twelve
(12) months. Such change shall not result in an increase that will exceed three
and one-fifth percent (3.2%) for any twelve (12) month period. In the event
Servicing Fees are not paid within thirty (30) days of the billing statement,
Lender agrees Servicer will have the following rights to (a) withhold transfer
of borrower payments; (b) withhold reports otherwise due; (c) impose a late
charge of one and one-half percent (l l/2%) per month against the entire
outstanding balance of the account including any prior late charge; and (d)
terminate services without notice if nonpayment persists for sixty (60) days
from billing or more.
The parties agree that should Servicer be required to make material
changes to its current Lender servicing practices or servicing system due to
changes to the Education Act, Regulations, and/or business environment, or to
other costs beyond Servicer's control, including but not limited to postal fees,
Servicer may renegotiate the Servicing Fees with Lender to reasonably reflect
those increased costs at any time during the term of this Agreement.
10. LOAN PAYMENTS. Student/parent borrowers will make all loan payments
to a third party lockbox established by Servicer. All cash receipts will be
remitted within two (2) Business Days of receipt to Trustee for deposit to the
Collection Fund.
11. DISCLOSURE OF INFORMATION. All data, information, records,
correspondence, reports or other documentation received by Servicer pursuant to
this Agreement from Lender or the school which the student attended or from the
student/parent borrower, or prepared and maintained by Servicer in the course of
its activities under this Agreement shall be released or divulged only to
Lender, or with respect to information or documents relating to a particular
student/parent borrower, to that student/parent borrower, or to such other
parties as Servicer may be directed in writing by Lender or such student/parent
borrower.
12. INTELLECTUAL PROPERTY PROTECTION. Notwithstanding anything in this
Agreement to the contrary, it is the express intention of the parties to this
Agreement that all right, title and interest of whatever nature in Servicer's
user manuals, training materials, all computer programs, routines, structures,
layout, report formats, together with all subsequent versions, enhancements and
supplements to said programs, all copyright rights (including both source and
object code) and all oral or written information relating to Servicer's programs
conveyed in confidence by Servicer to Lender pursuant to this Agreement which is
not generally known to the public and which give Servicer an advantage over its
competitors who do not know or use such information (hereinafter collectively
referred to as "Trade Secrets"), and all other forms of intellectual property of
whatever nature is and shall remain the sole and exclusive property of Servicer.
13. INQUIRIES. Servicer shall answer all inquiries received by it
pertaining to Education Loans, school status or refunds, and Lender shall
cooperate to the extent necessary to gather the information needed to answer
such inquiries. Such inquiries may be referred to the school which the student
borrower attended or is attending, if necessary. Servicer shall have no
responsibility for any disputes between student/parent borrowers and schools
regarding tuition, registration, attendance, or quality of education/training.
14. AGENT AUTHORIZATION. Lender hereby authorizes Servicer to act on
behalf of and as Lender's agent in the application processing and servicing of
Lender's Education Loans. Such authorization will include but not be limited to
all correspondence and liaison necessary with Guarantor regarding Lender's
Education Loans, assignment of claims to Guarantor and any/or all other
communications, correspondence, signatures or other acts appropriate to service
Lender's Education Loans in accordance with the Education Act and/or
Regulations.
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15. LIABILITY OF SERVICER. Servicer assumes no responsibility or
liability for failure of Lender to exercise reasonable care or due diligence and
the results thereof, in making or servicing an Education Loan prior to (a)
Servicer processing the application of the Education Loan, or (b) placing of the
Education Loan on Servicer's system and prior to the date Lender holds ownership
of the Education Loan. Servicer also assumes no liability for the failure of any
student/parent borrower to repay his or her loan, nor the failure of the United
States government to pay any principal, interest, subsidy or special allowance,
nor for the failure of Guarantor to make payment of any principal and/or
interest on any of Lender's Education Loans. Servicer shall not be responsible
for consequences of unreasonable acts of any Guarantor. In the event Servicer
shall take any action or fail to take any action which causes any Education Loan
in Lender's portfolio to be denied the benefit of any applicable guarantee,
Servicer shall have a reasonable time to cause the benefits of the guarantee to
be reinstated. If the guarantee is not reinstated within twelve (12) months of
denial by Guarantor, Servicer shall pay Lender an amount equal to the
outstanding balance plus all accrued interest and other fees due on the
Education Loan to the date of purchase and thereupon Servicer shall be
subrogated to all rights of Lender respecting the applicable Education Loan,
including without limitation the right to collect on the Education Loan, the
right to federal subsidies, and agency authorization to litigate in accordance
with the Subrogation Agreement attached hereto. In such event, Lender agrees to
perform such further acts as shall be necessary or appropriate to subrogate the
Education Loan to Servicer. For any subrogated Education Loan for which the
guarantee is fully reinstated by Guarantor, Lender shall pay Servicer pursuant
to the Subrogation Agreement an amount equal to the then outstanding principal
balance, plus all accrued interest due thereon, whereupon the subrogation rights
of Servicer shall terminate. In such event, Servicer agrees to perform such
further acts as shall be necessary or appropriate to reconvey the Education Loan
to Lender.
16. TERMINATION OPTION. If at any time during the term of this Agreement
either party refuses or fails to perform in a material fashion any portion of
this Agreement, and fails or refuses to correct said action or lack of action
within Thirty (30) days after receipt of written notice, the other party may,
upon Thirty (30) days written notice, terminate this Agreement. Without limiting
the generality of the foregoing sentence, the following shall be deemed as
failure or refusal to perform in a material fashion: (i) failure by Servicer to
make deposits to the Trustee of payments received with respect to the Education
Loans; (ii) failure or refusal to perform or observe in any material respect any
portion of this Agreement, including any failure to perform or observe in any
material respect any covenants or agreements contained herein; (iii) upon an
event of bankruptcy. An event of bankruptcy means: (a) the commencement of a
voluntary case or other proceeding seeking liquidation, reorganization or other
relief under any bankruptcy, insolvency or other similar law, or seeking the
appointment of a trustee, receiver, liquidator, custodian or other similar
official, making a general assignment for the benefit of creditors, declaring a
moratorium with respect to one's debts or failure to generally pay one's debts
as they become due; or (b) the commencement of an involuntary case or other
proceeding seeking liquidation, reorganization or other relief under any
bankruptcy, insolvency or other similar law, or seeking the appointment of a
trustee, receiver, liquidator, custodian or other similar official, provided
such action is not dismissed within 60 days. A failure or refusal to service an
Education Loan in accordance with the Education Act shall not constitute a
failure or refusal to perform or observe a covenant or agreement contained
herein so long as the Trustee receives payment of the principal balance and
accrued interest due on the affected Education Loan in accordance with this
Agreement.
17. INDEMNIFICATION. Lender shall indemnify and hold Servicer harmless
from and against all claims, liabilities, losses, damages, costs and expenses
(including reasonable attorney's fees) asserted against or incurred by Servicer
as a result of actions not the fault of or not caused by a negligent act of
Servicer, its agents or employees, including all claims, liabilities, losses,
damages and costs caused by or the fault of the Lender, a prior holder, owner or
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Lender, a prior servicer or any other party connected in any manner to
the loan or loans resulting in the claim, liability, loss, damage or cost. The
Servicer shall indemnify, defend and hold harmless Lender and its officers,
directors, employees, agents, attorneys-in-fact and affiliates from and against
any and all liabilities, damages, losses, claims and related costs and expenses,
including reasonable attorneys fees and disbursements relating to or resulting
from any claim that any of those Financed Eligible Loans originated by Servicer
on behalf of Lender pursuant to the Master Servicing Agreement dated as of May
1, 2003, between Lender and Servicer, as amended by the First Amendment to
Master Servicing Agreement dated as of June 30, 2003, have not been originated
or made in accordance with applicable federal and state laws, the Regulations of
any Guarantor, or to satisfy the definition of "Eligible Loan" at the time of
origination.
18. STATUTE OF LIMITATIONS. Any action for the breach of any provisions
of this Agreement shall be commenced within two years after the cause of action
has occurred. A cause of action occurs when the breach occurs, regardless of the
aggrieved party's lack of knowledge of the breach.
19. NOTICES. All notices or communications by one of the parties hereto
to the other shall respectfully be addressed as follows: Nelnet, Inc., 0000
Xxxxx Xxxxxx Xxxx, Xxxxx 000, Xxxxxx, Xxxxxxxx 00000, and to Nelnet Education
Loan Funding, Inc., attention Xxxxx X. Xxxxxx, 000 X. 00xx Xxxxxx, Xxxxx 000,
Xxxxxxx, XX 00000, or to such other address as may be indicated from time to
time by one of the parties to the other party. Except as otherwise expressly
provided, any notice shall have been deemed to have been given upon mailing
thereof when mailed by registered or certified mail, and upon receipt in every
other case.
20. GOVERNING LAW. This Agreement is executed and delivered within the
State of Colorado, and the parties hereto agree that is shall be construed,
interpreted and applied in accordance with the laws of that State, and that the
courts and authorities within the State of Colorado shall have sole jurisdiction
and venue over all controversies which may arise with respect to the execution,
interpretation and compliance with this Agreement.
21. CHANGES IN WRITING. This Agreement, including this provision hereof,
shall not be modified or changed in any manner except only by a writing signed
by all parties hereto.
22. SEVERABILITY. In the event a court of competent jurisdiction finds
any of the provisions of this Agreement to be so overly broad as to be
unenforceable or invalid for any other reason, it is the parties' intent that
such invalid provisions be reduced in scope or eliminated by the court, but only
to the extent deemed necessary by the court to render the provisions of this
Agreement reasonable and enforceable.
23. PERSONS BOUND. This Agreement shall be binding upon and inure to the
benefit of the parties hereto, their legal representatives, heirs, successors
and assigns.
24. ASSIGNMENT. This Agreement shall not be assigned by either party
without the prior written consent of the other party which consent shall not be
unreasonably withheld.
25. MUTUAL RELEASE. Each of the parties to this Agreement releases the
other party from any and all claims, or causes of the other arising from any
event or transaction occurring prior to the execution of this Agreement. This
release is an independent covenant between the parties, and will survive any
termination of this Agreement.
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26. TITLES. The titles used in this Agreement are intended for
convenience and reference only. They are not intended and shall not be construed
to be a substantive part of this Agreement or in any other way to affect the
validity, construction or effect of any of the provisions of this Agreement.
27. WAIVER. The waiver or failure of either party to exercise in any
respect any right provided for herein shall not be deemed a waiver of any
further right hereunder.
28. CONFIDENTIALITY. The Nondisclosure Agreement attached hereto shall
be incorporated into this Agreement by this reference.
29. LOAN SALES.
29.1 In the event Lender desires to sell or otherwise transfer from the
Servicer system any loans that are serviced pursuant to this Agreement prior to
a scheduled termination or breach of this Agreement, the Lender will sell the
Education Loans to an eligible lender maintaining an agreement with Servicer, in
order for the sale to cause no disruption in service, or change in servicer for
the borrower.
29.2 The intent of this Section 29 is to assure that all loans serviced
by Servicer pursuant to this Agreement will remain with Servicer for the
servicing life of the loan.
30. REMOVAL FEE. Should Lender remove any of its Education Loans from
the Servicer system prior to a scheduled termination or breach of this
Agreement, Lender agrees to pay to Servicer a removal fee of $15.00 per loan
transferred off the Servicer computer system. This removal fee shall be
exclusive of those changes described in Section 2.2 of this Agreement.
31. FORCE MAJEURE. The foregoing provisions of this Agreement are
subject to the following limitation: If by reason of a force majeure Servicer is
unable in whole or in part to carry out any agreement on its part herein
contained, Servicer shall not be deemed in default during the continuance of
such inability. The term "force majeure" as used herein shall mean, without
limitation, the following: acts of God, strikes, lockouts, or other industrial
disturbances; acts of public enemies; order or restraint of any kind of the
government of the United States of America or of the State of Colorado or City
of Aurora or any of their departments, agencies or officials, or any civil or
military authority; insurrections; riots; landslides; earthquakes; fires;
storms; droughts; floods; explosions; breakage or accident to machinery,
equipment, transmission pipes or canals; or any other cause or event not
reasonably within the control of Servicer.
32. ENTIRE AGREEMENT. This is the entire and exclusive statement of the
Agreement between the parties, which supersedes and merges all prior proposals,
understandings and all other agreements oral and written, between the parties
relating to this Agreement.
33. TRUSTEE AS THIRD PARTY BENEFICIARY. This Agreement has been made and
entered into not only for the benefit of Lender and Servicer but also for the
benefit of the Trustee in connection with the financing of the Education Loans,
and upon assignment by Lender to the Trustee, or an Event of Default by Lender
(as defined in the Indenture), its provisions may be enforced not only by the
parties to this Agreement but by the Trustee. The foregoing creates a permissive
right on behalf of the Trustee and the Trustee shall be under no duties or
obligations hereunder.
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This Agreement shall inure to the benefit of the Trustee and its
successors and assigns. Without limiting the generality of the foregoing, all
representations, covenants and agreements in this Agreement which expressly
confer rights upon the Trustee shall be for the benefit of and run directly to,
the Trustee, and the Trustee shall be entitled to rely on and enforce such
representations, covenants and agreements to the same extent as if it were a
party hereto. The foregoing creates a permissive right on behalf of the Trustee,
and the Trustee shall be under no duties or obligations hereunder.
34. INFORMATION. Servicer shall promptly furnish to Lender and Lender
from time to time, upon request, such information, reports and financial
statements within its control related to Servicer or the servicing of the
Education Loans as Lender or Lender reasonably deems appropriate to be prepared.
In addition, Servicer shall file all necessary reports or certifications with
the Securities and Exchange Commission or as required by the Xxxxxxxx-Xxxxx Act
of 2002 or the Indenture.
35. NO PETITION. Servicer hereby covenants and agrees that prior to the
date which is one year and one day after the payment in full of all Obligations
outstanding pursuant to the Indenture, it will not institute against or join any
other person or entity in instituting against the Lender any bankruptcy,
reorganization, arrangement, insolvency or liquidation proceedings or other
similar proceeding under the laws of the United State or any state of the United
States.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
NELNET, INC.
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Executive Director
NELNET EDUCATION LOAN FUNDING, INC.
By: /s/ Xxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
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SCHEDULE A
A. Loan Origination Fee.
Six Dollars ($6.00) per loan for Xxxxxxxx, SLS and PLUS loan. Fifty-five
Dollars ($55.00) per loan for Consolidated loans (if applicable). In
addition, reimbursement for costs in the event a credit evaluation of
the borrower is to be performed by Servicer.
B. Conversion Fee.
Five Dollars ($5.00) per account acquired by Lender and added to the
Servicer Servicing System during the period of time the borrower is in
school. For periods of time other than when the borrower is in school,
the fee will be Ten Dollars ($10.00) per account.
Notwithstanding the foregoing, should any portfolio present an
"Extraordinary Conversion", requiring additional conversion services
materially beyond that customarily provided for a normal acquisition of
Education Loans, then Lender agrees to pay a conversion fee mutually
agreed to between Lender and Servicer.
For purposes of this Agreement, whether a portfolio presents an
Extraordinary Conversion shall be determined after the data analysis,
and file review, have been conducted of the portfolio by Servicer.
Factors to consider in determining whether a portfolio presents an
Extraordinary Conversion are as follows:
1. Unprocessed data.
2. Degree to which the conversion may be automated versus
manual.
3. Integrity of the documentation, such as whether the files
are complete, or whether the data match the file content.
4. Lender adherence to its obligations and delivery
schedules.
5. Presence of backlogged processing in the portfolio.
6. Whether prior servicing had substantial noncompliance with
the Education Act and Regulations.
After consideration of the foregoing factors, Lender and Servicer agree
to come to mutual agreement at the beginning and once again at the end
of the conversion of a particular portfolio as to whether they need to
negotiate a mutually agreeable conversion fee.
C. Monthly Servicing Fee - All Types of Education Loans (Other than
Consolidation Loans) in School Status or Other than School Status.
0.90% annualized.
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D. Consolidated Loans.
0.50% annualized.
E. Billing for Servicing Fees.
The full monthly servicing fee shall be paid commencing with the
calendar month an account is disbursed on or converted to the Servicer
system.
F. Additional Servicing Activity.
Thirty-five Dollars ($35.00) per Education Loan referred for such cure
services, plus ten percent (10%) of all sums made eligible for
reinstatement of guarantee (including principal, interest and special
allowance) as a result of successful performance of the Cure Procedures
required by Guarantor.
G. Delinquency Fee.
A surcharge of Two Dollars and Twenty-five Cents ($2.25) for each
account more than thirty (30) days past due through date of claim
payment by Guarantor, or until account becomes current.
H. Appeal Fee.
A fee of Ten Dollars ($10.00) per month per account will be assessed for
Servicer to research and appeal accounts which are rejected or returned
by the guarantor due to acts, errors or omissions that occurred on the
account prior to servicing by Servicer.
I. Minimum Monthly Fee.
There will be a minimum monthly fee of Seven Hundred and Fifty Dollars
($750.00) per month.
J. Removal Fee. Loans transferred off the Servicer Servicing System prior
to termination of this Agreement will be assessed a fee of Fifteen
Dollars ($15.00) per account.
K. Deconversion Fee. Loans transferred off the Servicer Servicing System on
or after termination of this Agreement will be assessed a fee of Twelve
Dollars ($12.00) per account.
L. PLUS (or Other Loan) Loan Credit Checks.
Fees for obtaining a credit bureau report and evaluation will be Two
Dollars and Fifty Cents ($2.50) per loan application. An additional fee
of Fifty Cents ($.50) will be charged for those applications in which
written authorization must first be obtained prior to pulling a credit
bureau report.
M. Other Services
For services requested by Lender that are beyond the scope of those
described in this Agreement, the fees shall be assessed as follows:
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(l) Supplies Cost Plus l5%
(2) Training $40.00 per hour
(3) Programming $70.00 per hour
(4) Consulting $80.00 per hour
Projects and services of this type shall be provided only after request
by Lender and after time and total cost estimate is provided by
Servicer.
N. Legal Opinions.
Cost plus Five percent (5%).
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NONDISCLOSURE AGREEMENT
I. INTRODUCTION
This is an agreement between Nelnet Education Loan Funding, Inc.
(Reviewing Organization), dated April 1, 2004, and Nelnet, Inc.
(Servicer) in which Reviewing Organization agrees not to disclose
certain financial information belonging to Servicer as set forth
hereinafter.
II. AGREEMENT
In consideration of being made privy to confidential financial
information belonging to Servicer, Reviewing Organization hereby agrees
not to disclose any Servicer financial information to any third party or
use the same in competition with Servicer. At the request of Reviewing
Organization, Servicer may agree to make such financial information
available to persons designated by Reviewing Organization upon
satisfying the requirements stated in Section III.
III. CONFIDENTIALITY
The Reviewing Organization agrees during the review and/or receipt of
certain of Servicer's financial data and forever thereafter to keep
confidential any information and material (both written and verbal)
provided to Reviewing Organization by Servicer. Reviewing Organization
agrees not to copy any such materials provided by Servicer. Reviewing
Organization further agrees not to release, share, disclose or let
others view the same, except after advising of the nondisclosure
restrictions contained herein, to only those of Reviewing Organization's
employees, agents, or advisors having a need to know for the purpose of
evaluating the financial condition of Servicer and its ability to
perform its obligations under a Servicing Agreement. Individual agents
or advisors who have a bonafide need for a copy of Servicer's financial
data shall contact Servicer and may be provided a copy after execution
of our Nondisclosure Agreement with terms identical to those contained
herein. Servicer reserves the right to refuse data to agents and
advisors or any other party Servicer in its sole discretion deems
ineligible. This written understanding shall survive the termination or
cancellation of this agreement or of completion of a review.
Reviewing Organization recognizes the disclosure of information by
Reviewing Organization or Reviewing Organizations' agents or advisors
may give rise to irreparable injury to Servicer inadequately compensable
in damages and that accordingly, Servicer may seek and obtain injunctive
relief or damages against the breach or threatened breach of the within
undertakings, in addition to any other legal remedies, including
attorney's fees, which may be available. The parties agree, however,
that the duty to keep confidential Servicer's financial data and
information and materials provided in connection with the review thereof
shall not include data, information or materials which the Reviewing
Organization can demonstrate is publicly available by other than
unauthorized disclosures by other parties.
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IV. EXECUTION
This agreement is executed as of the date first written above, and shall
remain in effect until Servicer sends Reviewing Organization written
notice releasing it from the obligations of this agreement.
NELNET, INC. NELNET EDUCATION LOAN FUNDING, INC.
/s/ Xxxxxxx X. Xxxxxxxxx /s/ Xxxxx X. Xxxxxx
------------------------- ------------------------------
Signature Signature
Name: Xxxxxxx X. Xxxxxxxxx Name: Xxxxx X. Xxxxxx
Title: Executive Director Title: President
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SUBROGATION AGREEMENT
THIS AGREEMENT, effective the first day of April, 2004, by and between
Nelnet, Inc. (herein "Servicer") and Nelnet Education Loan Funding, Inc. (herein
"Lender").
WHEREAS, pursuant to that certain Servicing Agreement dated as of April
1, 2004, between Servicer and Lender (the "Servicing Agreement"), Servicer has
serviced certain Education Loans (as defined in the Servicing Agreement) for
Lender, some of which have been rejected by guarantors for guarantee claim.
WHEREAS, Servicer has agreed to pay certain losses to Lender on such
Education Loan claim(s) rejected by the guarantor(s).
NOW THEREFORE, in consideration of the mutual covenants contained herein
and other good and valuable consideration hereby acknowledged, the parties agree
as follows:
1. The term of this Agreement shall expire on the expiration of the term
of the currently existing Servicing Agreement.
2. This Agreement will apply only to Education Loans subject to payment
by Servicer where the principal has become uninsured by the guarantor(s). A
detailed list of such loans shall be clearly identified and provided to Lender
by Servicer from time to time. Such loans as identified shall be subject to the
terms of this Agreement.
3. Lender agrees to subrogate to Servicer all rights to collect on any
such an Education Loan including agency authorization to litigate, including any
and all other rights Lender may have on the loan account, including but not
limited to federal subsidies if the loan for which Servicer has made payment
with respect to an Education Loan rejected for guarantee by the guarantor(s) is
cured. Upon such payment, the Education Loan will be considered a "Subrogated
Loan".
4. For any Subrogated Loan for which insurance is reinstated in
accordance with guarantor policy, Lender will pay Servicer an amount equal to
the then outstanding principal balance and interest of the Subrogated Loan.
After such payment, the subrogation rights granted to Servicer by Lender in
Section 3 of this Agreement are revoked and such loan shall be deemed no longer
to be a Subrogated Loan; provided, however, that Lender's obligation hereunder
shall be limited to the extent funds are available to use from the Collection
Fund, as provided in Section 5.04(c) of the Indenture (as defined in the
Servicing Agreement.
5. Each party will identify a representative to develop the procedures
necessary to implement this Amendment.
NELNET, INC. NELNET EDUCATION LOAN FUNDING, INC.
By:/s/ Xxxxxxx X. Xxxxxxxxx By: /s/ Xxxxx X. Xxxxxx
---------------------------------- ----------------------------------
Name: Xxxxxxx X. Xxxxxxxxx Name: Xxxxx X. Xxxxxx
Title: Executive Director Title: President
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