Exhibit 10.23
NEW YORK STATE HIGHER EDUCATION SERVICES CORPORATION
CONSOLIDATION LOAN PROGRAM
LENDER PARTICIPATION AGREEMENT
AGREEMENT, made this l/st/ day of July, 2002 by and between NEW YORK
STATE HIGHER EDUCATION SERVICES CORPORATION, an educational corporation created
by act of the Legislature of the State of New York with its principal office at
Xxx Xxxxxxxx Xxxxx, Xxxxxx, Xxx Xxxx (hereinafter called the "Corporation"), and
STUDENT LOAN FINANCE CORPORATION & SUBSIDIARIES (US BANK, TRUSTEE) located at
XXXXXXXX, XX 00000-0000 (hereinafter called the "Lending Institution).
WITNESSETH:
WHEREAS, the Lending Institution wishes to participate in a program of
consolidation loans for eligible borrowers under Title IV, Parts B and E, of the
Higher Education Act of 1965, as amended, and under subpart II of Part C of
Title VII of the Public Health Services Act, hereinafter the program being
referred to as the "Consolidation Loan Program," and
WHEREAS, the Corporation has executed an agreement with the United
States Commissioner of Education to guarantee student loans, pursuant to part B
of subchapter IV of Chapter 28 of Title 20 of the United States; and
WHEREAS, the Lending Institution is an eligible lender as such term is
defined under Title IV, Part B of the Higher Education Act of 1965, as amended,
and one of the types of eligible lenders described in section 428C(l) of such
Act, and as such may participate in the Consolidation Loan Program.
THEREFORE, it is agreed by the Corporation and the Lending Institution
as follows:
1) Provided the Lending Institution remains an eligible lender
participating in the Corporation's Guaranteed Student Loan Program
and complies with the terms and conditions of this Agreement, the
Corporation shall insure all consolidation loans made by the
eligible lender which are eligible for such reinsurance under the
Acts and such Regulations issued thereunder applicable thereto,
which Acts and Regulations, as they may from time to time be
amended, are made a part of this Agreement.
2) A Lending Institution shall make a consolidation loan only if the
borrower shall certify that he or she has no other application
pending for consolidation loan, the Lending Institution holds at
least one of the borrower's eligible loans for consolidation or
obtains from the borrower a certificate that the borrower has been
unable to obtain a consolidation loan from the holders of his/her
outstanding loans selected for consolidation.
3) The loan shall meet the applicable requirements for a
consolidation loan set forth in section 428C(1) of the Higher
Education Act of 1965, as amended, and the regulations and such
other published terms and conditions as the United States
Secretary of Education or the Corporation have established or
shall hereinafter establish in relation of the Consolidation Loan
Program.
4) The Lending Institution shall pay proceeds of the consolidation
loan to the holder(s) of the loans selected for consolidation to
fully discharge the liability of the borrower of such loans.
S) The Lending Institution may terminate this Agreement upon 60 days
written notice to the Corporation. This Agreement may also be
terminated by the Corporation in a manner provided for under this
Agreement and applicable law and regulations. The termination of
the Agreement shall not affect the Corporation's insurance of any
consolidation loan made prior to such termination. Nothing herein
contained, however, shall be deemed to waive, or act to prohibit
or prevent the Corporation from asserting, any defense to an
insurance obligation of any consolidation loan that may be
available to it under the terns of this Agreement.
6) The Lending Institution's authority to participate in the
Consolidation Loan Program shall be subject to the Corporation's
Guaranteed Student Loan Program's limitation, suspension, and
termination proceedings. Any limitation or suspension of the
authority to participate in the Consolidation Loan Program imposed
in such a proceeding shall similarly suspend or limit the right of
the Lending Institution to make such loans under this Agreement; a
termination of authority to participate in the Consolidation Loan
Program shall act to terminate this Agreement. Any limitation,
suspension or termination of participation in the Corporation's
program resulting from any such proceeding, however, shall not
affect the insurance on any consolidation loan made prior to such
action. Nothing herein contained, however, shall be deemed to
waive, or act to prohibit or prevent the Corporation from
asserting, any defense to an insurance obligation on any
consolidation loan that may be available to it under terms of this
Agreement.
7) The Lending Institution shall make such reports to the Corporation
as to consolidation loans as the Corporation shall require. This
shall be deemed to include but not be limited to providing the
Corporation with a copy of the borrower's application and
promissory note and the borrower's repayment schedule and any
revision thereof.
IN WITNESS WHEREOF, the parties have caused this instrument to be
executed by their respective officers as of the day and date first above
written.
NEW YORK STATE HIGH EDUCATION STUDENT LOAN FINANCE CORPORATION
SERVICES CORPORATION AND SUBSIDIARIES (US BANK, TRUSTEE)
Name: Xxxxxx X. Xxxxx Name: XXX XXXXXX
Signature: /s/ Xxxxxx X. Xxxxx Signature: /s/ Xxx Xxxxxx
Title: V.P. Loans Division Title: Corporate Trust Officer
Date: 7/1/02 Date: 1-30-02
NEW YORK STATE HIGHER EDUCATION SERVICES CORPORATION
CERTIFICATE OF COMPREHENSIVE INSURANCE
The New York State Higher Education Services Corporation, herein referred to as
the "Corporation," hereby certifies that:
1. This Certificate applies to consolidation loans made by Student Loan
Finance Corp. & Subsidiaries (US Bank, Trustee) herein referred to as the
"Lender".
2. All consolidation loans made by the Lender which are made in conformity
with the requirements of Section 428C of Part B of title IV of the Higher
Education Act of 1965, as amended, are fully insured by the Corporation against
loss of principal and interest, provided:
a. The Lender has determined to is satisfaction, in accordance with
reasonable and prudent business practices, as to each loan being
consolidated pursuant to this Certificate:
(i) that each such loan is a legal, valid, and binding
obligation of the borrower,
(ii) that each such loan was made, insured and serviced in
compliance with applicable laws and regulations; and
(iii) that the insurance on each such loan is in full force and
effect.
b. This Certificate has not been terminated by the Corporation in
accordance with its terms.
c. The aggregate amount to which this Certificate applies, which is
specified in part 4 of this Certificate, has not been exceeded.
d. The Lender shall make such reports to the Corporation and shall
provide such information and documentation to the Corporation as
to consolidation loans as the Corporation shall require.
e. That if the Lender of this Certificate no longer proposes to make
consolidation loans, the Lender will so notify the Corporation in
order that this Certificate may be terminated. Such termination
shall not affect the insurance of any consolidation loan made
prior thereto. Nothing herein contained, however, shall be deemed
to waive, or act to prohibit or prevent the Corporation from
asserting any defense to an insurance obligation on any
consolidation loan that may be available to it under the terms of
this Certificate.
f. The Lender establishes and maintains repayment terms for
consolidation loans as are authorized by, and will promote the
objectives of, Section 428C of Part B of Title IV of the Higher
Education Act of 1965, as amended, including, but not limited to,
offering an income-sensitive repayment schedule made in accordance
with the regulations promulgated by the Secretary of the United
States
Department of Education. In any event, consolidation loan
borrowers must be allowed to accelerate repayment of the whole or
any part of their consolidation loan without penalty. At the
Corporation's request, the Lender will provide the Corporation
with copies of the Lender's records relating to the repayment
arrangements offered by the Lender which are described in this
subsection.
3. This Certificate shall become effective upon execution by HESC.
4. This Certificate applies to loans in an aggregate original principal
amount of up to two billion dollars ($2,000,000,000.00).
5. All administrative and procedural matters related to loans issued under
this Certificate, as well as any claims submitted by the Lender under this
Certificate, should be addressed to: New York State Higher Education Services
Corporation, Bureau of Lender Services, 00 Xxxxxxxxxx Xxxxxx, Xxxxxx, XX 00000.
6. If the Consolidation Loan Program Lender Participation Agreement between
the Lender and the Corporation dated July 1 ,2002 shall be terminated for any
reason, this Certificate shall also terminate without further notice. Such
termination shall not affect the insurance on any consolidation loan made prior
thereto. Nothing herein contained, however, shall be deemed to waive or act to
prohibit or prevent the Corporation from asserting any defense to an insurance
obligation on any consolidation loan that may be available to it under the terms
of this Certificate.
7. The Lender's authority to participate in the Consolidation Loan Program
is administered by the Corporation is subject to limitation, suspension or
termination for violation of the requirements of federal or New York State law
and/or regulations applicable to the Federal Family Education Loan program, the
terms of the above-referenced Consolidation Loan Program Lender Participation
Agreement between the Lender and the Corporation, or the terms of this
Certificate. No such action shall affect the insurance on any consolidation loan
made to prior to a termination of authority effected in such proceeding. Nothing
herein contained, however, shall be deemed to waive, or act to prohibit or
prevent the Corporation from asserting any defense to an insurance obligation on
any consolidation loan that may be available to it under the terms of this
Certificate.
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NEW YORK STATE HIGHER EDUCATION By: /s/ Xxxxxx X. Xxxxx
SERVICES CORPORATION Name: Xxxxxx X. Xxxxx
Title: Vice President-Loans Division
Date: 7/1/02
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NEW JERSEY HIGHER EDUCATION STUDENT ASSISTANCE AUTHORITY
GUARANTY LOAN AGREEMENT
This AGREEMENT is made this 30/th/ day of January, 2002 by and between New
Jersey Higher Education Student Assistance Authority, a body corporate and
politic with corporate succession, created by X.X.XX. 18A:71A-1 et seq., as
amended, whose office is located at 0 Xxxxxxxxxxxx Xxxxx, X.X. Xxx 000, Xxxxxxx,
Xxx Xxxxxx 00000 ("Authority") and STUDENT LOAN FINANCE CORPORATION AND
SUBSIDIARIES (US BANK TRUSTEE) with its principal office at 000 XXXXXXXXX XXXXX
XXXXXX, XXXXXXXX, XX 00000-0000 ("Lender").
WHEREAS: Lender wishes to be able to secure guarantee of loans made to or
on behalf of students pursuing programs of postsecondary education
at eligible institutions pursuant to Title IV of the Higher
Education Act of 1965, as amended (the "Act"), regulations
thereunder, and applicable state law; and
WHEREAS: the Authority, which exists for the purpose of providing
assistance to students pursuing programs of postsecondary
education at eligible institutions as defined by the Act,
regulations thereunder, and N.J.S.A. 18A:71A-1 et seq., is
authorized to guarantee loans; and
WHEREAS: the Authority desires that Lender shall make loans to or on behalf
of students, at Lender's option in each instance, the Authority to
guarantee the payment thereof upon the terms, conditions and
agreements herein contained;
NOW, THEREFORE, it is mutually agreed that:
1. Within such limits as may be set by the Act, regulations thereunder, New
Jersey statutes, regulations thereunder, and this AGREEMENT, the Authority (i)
shall guarantee loans with a first disbursement prior to October 1, 1993 no less
than 100 percent of full amount of such loans, including principal and interest,
held by the lender, and (ii) shall guarantee loans with a first disbursement on
or after October 1, 1993 no less than 98 percent of the full amount of all
loans, including principal and interest, made by the Lender, except that all
loans continue to be 100 percent guaranteed in the event of death, disability or
bankruptcy, situations covered by Section 428(j) or Section 439(q) of the Act or
other non-default claim (e.g., closed school or false certification) regardless
of disbursement date.
2. Whenever any guaranteed loan shall be in default (as defined by the Act,
regulations thereunder, New Jersey statutes, and regulations thereunder), or
upon the death or total and permanent disability of a borrower, or upon
bankruptcy, situations covered by Section 428(j) or Section 439(q) of the Act or
other non-default claim, the Authority shall purchase the loan in an amount
equal to the outstanding principal plus unpaid accrued interest in accordance
with paragraph 1, provided that the loan was made in accordance with the Act,
regulations thereunder, New Jersey statutes, regulations thereunder; Lender has
exercised due diligence in the making, servicing, and collection of such loan;
Lender has subrogated title to the loan note to the Authority to the extent of
the affected loans(s); and Lender has otherwise performed its obligations under
this AGREEMENT.
3. The Authority shall guarantee loans without regard to sex, age, race,
color, religion, handicapped status, income, national origin and any other basis
prohibited by applicable law and Lender shall not discriminate in the making of
loans to eligible borrowers, as defined by the Act and New Jersey statutes, or
in the treatment of such borrowers on any prohibited basis.
4. Lender shall provide notification to the Authority when it acquires a
loan for which the Authority has issued a notice of loan guarantee_ Regarding a
guaranteed loan already held by Lender, in order for a loan account to remain
subject to the Authority guarantee obligation, the loan may be transferred only
to another approved lender or eligible holder of New Jersey guaranteed loans.
5. Lender shall notify the Authority of any servicing or management of
Lender's guaranteed loan portfolio performed by an agent(s) other than the
holder of record.
6. Lender agrees to serve, upon the Authority's request, in the New Jersey
Xxxxxxxx Loan Program, as a lender of last resort during the term of this
AGREEMENT. Lender of last resort loans defined in sections 428(j) and 439(q) of
the Act, are 100 percent guaranteed. New Jersey lender of last resort Xxxxxxxx
Loans shall be assigned to lenders of last resort on a rotation basis and in
proportion to the total New Jersey Xxxxxxxx Loan dollar volume made by such
lenders_
7. Payment of a loan may be extended in whole or in part, and the provisions
of the loan may be modified without notice to and without affecting the
liability of the Authority, if such extension or modification complies with the
requirements for loans under this AGREEMENT, the Act, regulations thereunder,
New Jersey statutes, and regulations thereunder.
8. Lender shall not provide to or accept financial inducements from any
school for making New Jersey guaranteed loans available to students attending a
school.
9. Lender shall maintain for all loans guaranteed a system of records and
accounts, shall afford access thereto at reasonable times and intervals, and
shall furnish such periodic and separate reports as may reasonably be required
by the U.S. Department of Education and the Authority, under the Act,
regulations thereunder, New Jersey statutes, and regulations thereunder. For
loans paid in full or otherwise discharged, Lender shall also maintain records
as required by the Act, regulations thereunder, New Jersey statutes, and
regulations thereunder. For example, Lender shall retain the records required
for each loan for not less than five years following the date the loan is repaid
in full by the borrower.
10. For loans processed through the New Jersey Automated Loan Processing
System (NJALPS), Lender authorizes the Authority to act as follows:
a. The Authority shall retain on behalf of the Lender the school's
statement of the student's enrollment, borrower/student's need,
and eligibility for the period as required of Lender by the Act
and regulations thereunder, and
b. The Authority shall provide borrower/student and school
information needed to make a loan under the Act and regulations
thereunder to Lender or Lender's Representative (i.e., the
servicer of the loan), by data processing means or other
means determined by the Authority, for Lender's consideration in
deciding whether to make the loan to the applicant.
11. To facilitate guarantee processing of Federal Family Education Loan
Program (FFELP) loans when a Master Promissory Note is NOT used (e.g., Common
Loan Application/Promissory Note and PLUS Application/Promissory Note), so that
obtaining multiple loan amount approvals from Lender is not needed in such
situations when there is a change in the allocation of subsidized and
unsubsidized loan amounts or a change in the amount certified by the school, the
Authority will perform the following on behalf of Lender:
a. The Authority will receive application and promissory note data
for FFELP loans ("application data") provided by the school, the
borrower, or the Lender. The Authority will review the application
data for completeness and when needed, contact the appropriate
party to collect missing information.
b. The Authority will review the application data provided by the
borrower, the student, school, and the lender, as applicable, and
guarantee loans for the lesser of the amount the borrower
requests, the student's financial need, the amount certified by
the school, or the applicable grade level maximum.
c. The Authority will provide the Lender with a Loan Guaranty Notice
and Disclosure Statement. If the Lender wishes to deny or reduce
the loan, the Lender will so notify the Authority. If the amount
is changed, the Authority will send the Lender a replacement
guaranty notice reflecting that change. Nothing in this AGREEMENT
shall prevent the Lender from disbursing, upon proper notice to
the Authority and the borrower, a loan amount less than the amount
guaranteed.
12. The Authority shall maintain at all times reserve levels which comply
with the Act, regulations thereunder, X.X.XX. 18A:71A-1 et seq., and regulations
thereunder.
13. Failure of Lender to comply with the terms of this AGREEMENT with respect
to an individual loan or loans shall not invalidate the guarantee of the
Authority to Lender with respect to other loans held in compliance with the
terms of this AGREEMENT.
14. Lender and Authority agree to comply with all applicable Federal and
State statutes, rules, and regulations, whether applicable presently or
hereafter in performing the terms of this AGREEMENT.
15. This AGREEMENT maybe terminated by either party by giving thirty (30)
days notice in writing to the other party by certified mail. All rights and
obligations hereunder shall immediately cease upon termination, except the
rights and obligations of the parties which existed prior to the date of such
termination.
16. The Authority and Lender each represents to the other that it has the
full and unencumbered right to enter this AGREEMENT and to fully perform its
obligations hereunder.
17. This AGREEMENT sets forth the entire agreement of the parties with
respect to any and all loans which may be made hereunder.
18. If any provision of this AGREEMENT is invalid under the Act, regulations
thereunder, New Jersey statutes, or regulations thereunder and the invalidity
shall not affect other provisions of this AGREEMENT which can be given effect
without the invalid provisions, then to this end, the provisions of this
AGREEMENT are severable.
19. This AGREEMENT is to be governed by and construed in accordance with the
internal laws of the State of New Jersey, without giving effect to conflict of
law principles.
IN WITNESS WHEREOF, the parties have caused this AGREEMENT to be executed by
their duly authorized representatives, and their respective seals to be affixed,
as of the dates indicated below.
Date: February 20, 2002 NEW JERSEY HIGHER EDUCATION STUDENT
ASSISTANCE AUTHORITY
By: /s/ Xxxx X. Xxxxxxxx
Xxxx X. Xxxxxxxx, Esq.
Title: Director of Government Relations
and Legal Affairs
Date: 1-30-2002 STUDENT LOAN FINANCE CORPORATION &
SUBSIDIARIES (US BANK TRUSTEE)
By: /s/ Xxx Xxxxxx
Xxx Xxxxxx, Corporate Trust Officer
833405
Lender Identification Number(s)
00-0000000
Employer Identification Number
