Exhibit 10.1

Confidential Materials omitted and filed separately with the
Securities and Exchange Commission. Asterisks denote omissions.

AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT
BETWEEN
PENNSYLVANIA HIGHER EDUCATION ASSISTANCE-AGENCY
AND
THE FIRST MARBLEHEAD CORPORATION

THIS AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT (this
“Agreement”) is made and dated as of September 28, 2006 (the “Effective Date”),
by and between the Pennsylvania Higher Education Assistance Agency (d/b/a
American Education Services), a public corporation and governmental
instrumentality organized under the laws of the Commonwealth of Pennsylvania,
1200 North Seventh Street, Harrisburg, Pennsylvania 17102 (“Servicer”), and The
First Marblehead Corporation, having an address at 800 Boylston Street, 34th
Floor, Boston, Massachusetts 02199 (“FMC”), and amends and restates that certain
Alternative Servicing Agreement between Servicer and FMC dated as of October 16,
2001 (“Old Servicing Agreement”).

RECITALS

WHEREAS, the Servicer is in the business of servicing privately insured student
loans and other education loans for lenders; and

WHEREAS, Program Lender (defined below) and FMC have created a group of
education loan programs, all of which are described in the Program Guidelines
(defined below), pursuant to which education loans are funded by Program Lender
and purchased by FMC or an SPE (defined below); and

WHEREAS, in order to ensure the integrity of the education loans at the time
they are purchased by FMC or an SPE, FMC desires to oversee the servicing of
such education loans prior to purchase; and

WHEREAS, FMC desires to utilize the expertise of the Servicer to service such
education loans as and when they are purchased by FMC or an SPE;

NOW, THEREFORE, in consideration of the mutual promises contained in this
Agreement and the fees to be paid by FMC to the Servicer, and intending to be
legally bound, the parties to this Agreement do hereby agree to the following:

SECTION 1.  DEFINITIONS

1.01                           “Account” means the Student Loans collectively of
an individual Borrower.

1.02                           “Agreement” means this Amended and Restated
Private Student Loan Servicing Agreement, including each Schedule and Exhibit
provided for herein and each amendment hereafter adopted.

1.03                           “Borrower” means an individual who is the maker
of a Credit Agreement and who

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obtains a Student Loan or a Committed Student Loan. “Borrower” includes both the
primary obligor and any cosigner.

1.04                           “Business Days” means a day of the year other
than a Saturday or Sunday, or a day on which the Servicer or FMC is required or
authorized by law to remain closed, and on which either does remain closed.

1.05                           “Change of Control” means the sale to any other
entity, individual or group of all or substantially all of the entity’s assets
used to perform the Services.

1.06                           “Committed Student Loans” means any of and
“Committed Student Loans” means all, the Private Student Loans which FMC is
obligated to or has the right to purchase under third-party agreements with
Program Lender and which, upon the occurrence of such purchase, will become
Student Loans.

1.07                           “Confidential Information” has the meaning
assigned to it in Section 11.02.

1.08                           “Consumer Information” has the meaning assigned
to it in Section 11.03.

1.09                           “Credit Agreement” shall mean the promissory note
or credit agreement executed by a Borrower evidencing a Student Loan or a
Committed Student Loan.

1.10                           “Customer” has the meaning assigned to it in
Section 11.03.

1.11                           “Customer Information” has the meaning assigned
to it in Section 11.03.

1.12                           “Customer Service Schedule” means the schedule of
that name attached hereto and as amended by agreement of the parties.

1.13                           “Disaster Recovery and Business Continuity Plans”
has the meaning given to it in Section 11.05.

1.14                           “Failed Standard” shall have the meaning given to
it in Section 4.02.

1.15                           “Fee Schedule” means the schedule of that name
attached hereto and as amended by agreement of the parties.

1.16                           “FMC” means The First Marblehead Corporation in
its capacity as “FMC” and “Securitization Sponsor,” (as those roles are defined
in the Program Guidelines), and as a party entitled to Servicing of Committed
Student Loans and Student Loans.

1.17                           “FMDS” has the meaning given to it in Section
4.14.

1.18                           “FMER” means First Marblehead Education
Resources, Inc., a wholly owned subsidiary of FMC.

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1.19                           “Force Majeure” has the meaning given to it in
Section 10.01.

1.20                           “Identity Theft Procedures” means the Procedures
for Fraud Notification set forth in the Servicing Guidelines and as amended by
agreement of the parties.

1.21                           “Information Security Program” has the meaning
given to it in Section 11.03.

1.22                           “Insurer” means The Education Resources
Institute, Inc. (“TERI”) or such other private insurance agencies as the parties
may mutually agree upon from time to time.

1.23                           “Late Fees” has the meaning given to it in
Section 4.14.

1.24                           “Material Adverse Change” means any condition or
event that is reasonably likely to have a material adverse effect on (i) the
business operations, property or condition (financial or otherwise) or prospects
of the Servicer, or (ii) the validity or enforceability of this Agreement or any
of the Schedules or Exhibits hereunder.

1.25                           “Milestone” shall have the meaning given to it in
Section 4.03(d).

1.26                           “Non-Peak Application Periods” means the months
other than June, July, August and September.

1.27                           “Old Servicing Agreement” has the meaning set
forth above.

1.28                           “Operations Meeting” shall have the meaning given
to it in Section 4.09 of this Agreement.

1.29                           “Original Credit Agreement” means the signed
first or first two pages of the Credit Agreement (beginning with the Borrower
and Program Lender name and ending with a signature or signatures).

1.30                           “Owner” means with respect to a Student Loan,
Program Lender prior to a Securitization Transaction and then FMC or any
Permitted Assignee that purchases such Student Loans or any interest therein
from Program Lender or from another Permitted Assignee in a Securitization
Transaction.

1.31                           “Peak Application Periods” means the months of
June, July, August and September.

1.32                           “Permitted Assignee” means a Special Purpose
Entity (as defined below), or any financial institution, bond insurer, guaranty
agency, indenture trustee, lender’s collateral agent or other substantially
similar party to whom rights under this agreement are assigned as security in a
financing transaction to which the Special Purpose Entity is a party.

1.33                           “Person” means a natural person, limited or
unlimited liability corporation, limited liability company, limited liability
partnership, partnership, association, trust or any other

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legal entity having the capacity to contract.

1.34                           “Program Guidelines” means, solely for purpose of
identifying Private Student Loan programs to be Serviced under the Agreement,
the Underwriting, Origination and Loan Term Guidelines for one or more Private
Student Loan programs identified by the parties from time to time in a writing
signed by both parties.  At the time of this Agreement, Program Guidelines
includes the Underwriting, Origination and Loan Term Guidelines for those
Private Student Loan programs set forth on Schedule A attached hereto.

1.35                           “Program Lender” means one or more lenders to be
specified by the parties in writing, signed by both parties from time to time.
At the time of execution of this Agreement, Program Lenders include the
following: Bank of America, N.A.; JPMorgan Chase Bank, N.A.; Charter One Bank,
N.A.; Chase Manhattan Bank USA, N.A.; Citizens Bank of Rhode Island; GMAC Bank;
HSBC Bank USA, N.A.; The Huntington National Bank; Insurbanc; KeyBank, National
Association; Manufacturers and Traders Trust Company (M&T Bank); National City
Bank; PNC Bank, N.A.; Sovereign Bank; and SunTrust Bank.

1.36                           “Program Manual” has the meaning assigned to it
in Section 4.09.

1.37                           “Program Year” means the period from May 1 to
April 30.

1.38                           “Private Student Loan” or “PSL” means an
education loan to finance the costs of higher education (or private K-12
education) that is not (a) guaranteed by the United States Department of
Education nor by any agency of any state or (b) a Guaranteed Access to Education
(GATE) Loan program (other than the Bank of America GATE Education Loan (BAGEL)
Program that is guaranteed by TERI).

1.39                           “Proprietary Information” has the meaning given
to it in Section 11.01.

1.40                           “Remedial Action Plan” has the meaning given to
it in Section 4.03(d).

1.41                           “Required Reports Schedule” means the schedule of
that name attached hereto and as amended by the agreement of the parties.

1.42                           “Securitization Transaction” means the purchase
of a pool of Student Loans by an SPE.

1.43                           “Service”, “Services”, “Serviced”, “Servicing”
shall mean to perform, in full compliance with applicable federal and state laws
and regulations, the terms and conditions of the Credit Agreements, the
Servicing Guidelines, the Program Manual, and the terms and conditions of this
Agreement, including without limitation the Service Level Agreement: duties,
obligations, and procedures that are required of Servicer hereunder in
connection with Student Loans and Committed Student Loans.

1.44                           “Service Level Agreement” means the Service Level
Agreement attached hereto as Exhibit C and as amended by agreement of the
parties.

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1.45                           “Servicer Consent Letter” means a letter
substantially in the form of Exhibit A, to be executed by Servicer, FMC, and an
SPE in connection with each Securitization Transaction.

1.46                           “Servicing Guidelines” means the Servicing
Guidelines for one or more Private Student Loan programs that have been issued
by Insurer and approved by FMC and Servicer attached hereto as Exhibit B and as
may amended by agreement of the parties pursuant to the terms thereof.

1.47                           “Special Purpose Entity” or “SPE” means a trust,
corporation or limited liability company organized by FMC and engaged solely in
the business of purchasing Private Student Loans and engaging in financing
and/or securities transactions to obtain funds to purchase such Private Student
Loans.

1.48                           “Student Loan” means any of, and “Student Loans”
means all, the Private Student Loans executed by a Borrower, funded by Program
Lender, purchased by FMC or an SPE and which are Serviced by the Servicer
pursuant to this Agreement.

1.49                           “System Access Schedule” means the schedule of
that name attached hereto and as amended by agreement of the parties.

1.50                           “Trustee” means the Permitted Assignee having a
lien or security interest in a pool of Student Loans, which lien or security
interest is held for the benefit of investors or lenders providing funds in such
Securitization Transactions.

SECTION 2.  SCOPE OF AGREEMENT

2.01                        Old Servicing Agreement.  On the Effective Date,
this Amended and Restated Servicing Agreement shall supersede and replace the
Old Servicing Agreement in its entirety. Pursuant to Section 13.02, this
Agreement has been assigned in part to SPEs with respect to pools of Student
Loans. The Servicing of such Student Loans shall be governed by this Agreement
upon receipt by Servicer of the written consent of an SPE who has become a party
to this Agreement by virtue of such assignment; provided, however, that FMC
shall be solely responsible for obtaining the written consents of SPEs for
Servicing under this Agreement.

2.02                        Services.  The Servicer agrees, in consideration of
certain fees, to perform the Services set forth in this Agreement, including
each Schedule and Exhibit hereto, and any additional Services which FMC requests
and the Servicer agrees to provide with respect to the Servicing of Student
Loans in accordance with the Servicing Guidelines, for which account information
and/or documentation shall be delivered to the Servicer.

2.03                        Role of FMC.  Servicer acknowledges that FMC has,
under third-party agreements, the obligation or the right to purchase the
Committed Student Loans and FMC, as the parent company of the Insurer’s agent,
FMER, has an obligation to the Insurer to ensure the

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adequate conversion of the Committed Student Loans from FMER’s origination
system to Servicer’s Servicing system.  In light of the foregoing, Servicer
further acknowledges that FMC has a present interest in Committed Student Loans
and Servicer agrees to provide product setup and  conversion Services for such
loans pursuant to this Agreement.  Such rights of FMC pursuant hereto shall be
in addition to, and not in derogation of, the rights of Program Lender as Owner
of such Committed Student Loans. FMC shall not have liability under this
Agreement for any Student Loan unless and until FMC becomes an Owner of such
Student Loan.

Servicer agrees that upon assignment of FMC’s rights with respect to a pool of
Student Loans to an SPE or other Permitted Assignee: (i) all obligations of FMC
under this Agreement with respect to such Student Loans, including without
limitation the obligation to pay the fees set forth in the Fee Schedule, shall
cease upon assumption of that obligation by any SPE and (ii) all of FMC’s rights
under this Agreement, other than the right to receive Services with respect to
such pool of Student Loans, shall be retained by FMC, including without
limitation those rights relating to product setup and conversion of Committed
Student Loans, and audits that relate to continuing Services.

SECTION 3.    TERM OF AGREEMENT

This Agreement shall commence on the date first set forth above and shall
continue, with respect to Student Loans which are subject to this Agreement
(including loans serviced under the Old Servicing Agreement and new Student
Loans serviced on and after the effective date of this Agreement), in accordance
with Section 14.01, unless earlier terminated by either Party pursuant to the
provisions of this Agreement. With respect to product setup and conversion
services and the fees charged for the Services, this Agreement shall continue
for a period of three (3) years from the date first set forth above, unless
earlier terminated by either Party pursuant to the provisions of this Agreement,
and shall automatically renew for an additional one (1) year period, unless
terminated by any Party by written notice of non-renewal to the other given at
least one hundred and eighty (180) days prior to the end of the then current
term. The expiration or termination of this Agreement as to the addition of new
Student Loans shall in no way affect the rights or obligations of Servicer with
respect to Student Loans that have become subject to this Agreement by partial
assignment of this Agreement to an SPE.

SECTION 4.  Servicing Duties

4.01                        Servicing Duties.  Servicer shall provide and
perform the Services in full compliance with: the terms of this Agreement,
including without limitation the Service Level Agreement (as amended by the
parties from time to time in accordance with the terms thereof) ; the Servicing
Guidelines; the Program Manual; the terms and conditions of the Credit
Agreements; and all federal and state laws and regulations applicable to
Servicer or Program Lender or any Owner.

4.02                        Failed Service Levels: Notice and Cure  Servicer
shall notify FMC through the reports

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required by Exhibit C to this Agreement, which reports shall be made in
accordance with Section 5.04 hereof, of any failure to meet any Servicing
standard set forth in the Service Level Agreement other than standards defined
therein as “Servicer’s Service Objective” (a “Failed Standard”). In the event
that the Servicer shall fail to perform the same Servicing standard for thirty
(30) days thence (the second consecutive Failed Standard), then the Owner shall
be entitled to a reduction (or rebate if already paid) of [**]of the Servicing
Fees due the Servicer pursuant to Section II of the Fee Schedule (a “Fee
Reduction”) with respect to the months in which the Failed Standard shall have
occurred. The Owner shall continue to be entitled to a Fee Reduction for each
subsequent consecutive month in which the Servicer shall fail to perform the
same standard. Notwithstanding the foregoing, no reduction or rebate shall be
made with respect to any Failed Standard that occurs prior to March 1, 2007. 
This Section 4.02 shall be effective from the Effective Date through August 31,
2007, and shall then be open for negotiation. If no changes are proposed or
agreed to in writing, this Section 4.02 shall remain in effect.

4.03                        Product Setup and Conversion.  Servicer agrees, in
accordance with the existing practices and procedures of the parties, to perform
product set-up and conversion Services with respect to the Committed Student
Loans as set forth in the Product Setup and Conversion Service Level Agreement
which shall include, without limitation, the following:

(a)                                  Credit Agreement Forms.  Servicer shall
promptly review promissory note or credit agreement forms that are proposed by
FMC and/or Program Lender and, after mutual resolution of any comments thereon
that affect the Servicing of such forms, accept such forms for purposes of
product set-up and conversion.

(b)                                 Servicing System Adaptation.  Servicer shall
promptly review education loan product terms and pricing matrices proposed by
FMC and/or Program Lender and shall establish appropriate Servicing matrices and
programs to support such product terms and pricing as of a mutually agreed
product launch date. The parties shall publish a mutually agreeable program
launch date for each program within each Program Year. Servicer shall make every
effort to meet live program dates requested by FMC, which date shall be no less
than thirty (30) days from the date Servicer accepts the product and pricing
matrix (or similar document containing the same information) for such program;
provided, however, that the Servicer agrees to use commercially reasonable
efforts to complete the set-up process in a shorter time frame on a case-by-case
basis in order to accommodate the business needs of FMC (or its clients). FMC
shall have the right to audit Servicer’s Servicing matrices and program setup as
set forth in Section 4.03(d) below.

(c)                                Conversion.  Servicer agrees to accurately
convert all Committed Student Loan origination data necessary for servicing
hereunder onto its Servicing System in accordance with Section VI of the Service
Level Agreement. Servicer shall also, in a timely manner, return to the Servicer
Relations Group at FMC all loan files sent to the Servicer in error.

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(d)                                 Periodic Audit. Servicer agrees that, no
less than twenty (20) days after receipt of written notice, shall cooperate with
audits by FMC of the product set-up and conversion Services and communication
and other protocols necessary for the efficient and accurate performance
thereof. If any audit reveals any failure to adequately perform any such matter,
Servicer shall within thirty (30) days of its receipt of the results of such
audit, publish a remedial action plan that includes a schedule of tasks and
objectives to be completed (each such task or objective, a “Milestone”) and
provides for reports to FMC with respect to each Milestone (“Remedial Action
Plan”) and provide the same to FMC. Upon completion of the Remedial Action Plan,
FMC may, at a time mutually agreeable to the parties, perform an additional
audit to validate successful completion of the Remedial Action Plan.

4.04                        Custody Procedure.  The Servicer shall hold all
Original Credit Agreements and related documents Serviced hereunder on behalf of
the Owner and shall retain each such Credit Agreement and related documents
until five (5) years after the earlier of (a) the date upon which the Student
Loan evidenced by such Credit Agreement and related documents is paid in full or
(b) the date upon which the Student Loan is deconverted from Servicer’s
Servicing System.  The Servicer shall maintain all Original Credit Agreements
that have an original, wet signature in a fire resistant vault equipped with a
fire suppression system which is connected to an alarm and a security locking
system.  Servicer shall create microfilm or electronic records of all Original
Credit Agreements and related documents at no additional cost to FMC and shall
maintain such microfilm or electronic records on-site at the Servicer’s
Servicing center at Harrisburg, PA and at an off-site facility in a fire
resistant vault equipped with (a) a fire suppression system which is connected
to an alarm and (b) with a security locking system at least 100 miles away from
the on site facility used to house the Original Credit Agreements and related
documents. The Servicer shall supply FMC, upon request, microfilm or electronic
copies of Original Credit Agreements and related documents.  FMC or its
designated agent shall have the right to inspect all security procedures during
Servicer’s regular business hours.  The Servicer shall provide FMC with sixty
(60) days advance notice of any change in the physical location, of the Original
Credit Agreements and related documents or any relocation of the Servicer’s
Servicing center.  All Original Credit Agreements at all times shall be stored
in a state other than the State of Louisiana.

4.05                        Lost or Damaged Records.  In the event that records
or other data submitted to the Servicer for Servicing should be lost or damaged
while in the possession, control or custody of the Servicer or its agents, such
lost or damaged records or data shall be reproduced by the Servicer at the
Servicer’s own cost and expense from microfilm or image duplicates in the
Servicer’s possession or under the Servicer’s control and the Servicer shall pay
the Owner’s expenses associated with such lost or damaged records or data,
including but not limited to reasonable attorney’s fees.  In the event that a
Student Loan becomes uncollectible, unenforceable or loses the guarantee of the
Insurer or other entity which pays default claims on Student Loans, due to loss
or destruction of records or data in the possession, control or custody of the
Servicer or its agents then the Servicer

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shall, on demand, pay to the Owner the principal balance (including capitalized
interest) plus any unpaid interest due on any such Student Loan and the Owner
shall thereupon assign all of its right, title and interest in any such loan to
the Servicer.

4.06                        System Changes.  The Servicer has the right to
change any part or all of its equipment, its Servicing system, computer
programs, and its procedures relating to the manner of or the methodology used
in servicing the Student Loans, subject to the following:

(a)                                In no event shall such change abrogate or in
any way modify the obligations of the Servicer to Service the Student Loans or
the Committed Student Loans in full compliance with all applicable federal and
state laws and regulations, the terms and conditions of the Credit Agreements,
the Servicing Guidelines, the Program Manual or the terms of this Agreement,
including without limitation the Service Level Agreement, or the quality of the
Service.

(b)                               As part of the quarterly meeting discussed in
Section 4.09 below, the technical and operational staffs of Servicer and FMC
shall discuss upcoming system changes for each party and to follow up on any
emergency changes implemented during the prior quarter under subsection (d)
below. The parties agree that they shall provide reasonable information about
the nature and effect of changes that the parties reasonably believe may affect
the operations or processes of the other and shall determine the extent to which
the other party needs to be involved in the testing of changes to its own
system.  At each meeting, the parties shall also discuss proposed implementation
dates for system changes and shall make best efforts to avoid implementation
dates that will have a material adverse impact on the operations of the other
party.

(c)                                Servicer shall test, prior to implementation,
each system change that will affect the Servicing of Student Loans to determine
that such change will not result in adverse consequences to its obligations
under this Agreement. Servicer will document all changes and corresponding
testing of such changes.

(d)                                 If the need to make any emergency changes
arises, Servicer shall notify FMC of such need as soon as is reasonably possible
but in all cases prior to the implementation of any change. Servicer shall track
all emergency changes.

4.07                        System Access.  Servicer shall, at the direction of
FMC and only at the direction of FMC, provide FMC, FMDS on behalf of each Owner,
TERI, and FMER as agent for TERI with web-based access to Student Loan and
Committed Student Loans files, or portions thereof, in accordance with the terms
of the System Access Schedule, which shall set forth, without limitation, the
type of access and/or online services that must be available to each type of
user and the minimum user access security requirements that must be implemented
on Servicer’s Servicing system.  Servicer shall at all times maintain the
security of user access to its Servicing system in conformity with the security
provisions of the System Access Schedule, which shall include, without
limitation, Servicer’s review of the individual user access rights of Servicer
employees

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and other users no less frequently than every ninety (90) days.

4.08                        System Parameters.  The Servicer is responsible for
designing, implementing and maintaining its Servicing system in accordance with
the requirements of this Agreement, including without limitation the System
Requirements Service Level Agreement.

4.09                        Operations Meetings; Procedures Manual.  The
Servicer and FMC agree that they shall mutually schedule and conduct a joint
meeting of their operational staffs no less frequently than once per calendar
quarter for the discussion, tracking, and resolution of any operational issues
relevant to the Servicing of Student Loans under this Agreement (each such
meeting, an “Operations Meeting”).

As part of the series of operational meetings, the Servicer and FMC shall create
and maintain a procedures manual for all aspects of Servicing which shall comply
fully with the terms of this Agreement, including without limitation the Service
Level Agreement, the Servicing Guidelines, the terms and conditions of the
Credit Agreements, and all applicable federal and state laws (“Program Manual”).
Servicer and FMC shall collaborate on the Program Manual and shall complete the
same within 180 days of the execution of this Agreement. The final version of
the Program Manual shall be negotiated, mutually agreed upon, and distributed
between the Parties. The Program Manual shall be subject to the provisions of
Section 11.01 (confidentiality). As a condition precedent to the effectiveness
of any provision of the Program Manual that has an impact on the Servicing
Guidelines, the Servicing Guidelines must be amended pursuant to the terms
thereof to contain such provision. System changes that are needed as a
consequence of any provision of the Program Manual will be completed within a
timely manner and in accordance with a schedule adopted by the parties at an
Operations Meeting.

The parties shall review the Program Manual annually for revisions and updates.
The parties anticipate that the Program Manual may include, without limitation,
the following information:

(a)                                  Description of all loan product terms
relevant to Servicing for all Student Loans, including a history of Program Year
changes which shall commence upon execution of this Agreement;

(b)                                 Borrower communications letter bank;

(c)                                  Due diligence procedures;

(d)                                 Procedures for delinquency and default,
including but not limited to bankruptcy and death;

(e)                                  Forbearance procedures and forms;

(f)                                    Cancellation policies and procedures;

(g)                                 Disbursement procedures;

(h)                                 Deferment processing and enrollment
confirmation requirements;

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(i)                                     Skip tracing procedures;

(j)                                   Consumer Reporting Agency reporting;

(k)                                  Service levels, including without
limitation

(i)                                     Customer Service for phone, web and
paper communications, including issue resolution and quality control

(ii)                                  Payment processing

(iii)                               Origination Processing (as applicable)

(iv)                              Conversion Processing (as applicable) and,

(v)                                 System Availability and Parameters;

(l)                                     Default Prevention (as applicable);

(m)                               Fraud detection; Identity theft and fraud
claim processing (FACT Act);

(n)                                 Servicer  “cure” procedures;

(o)                                 Escalation procedures for Disaster Recovery
and Business Continuity Plans;

(p)                                 Servicing reports; and

(q) Secure communication protocol for borrower level data.

4.10                        Training.  Servicer will assume responsibility, at
its expense, for training of its staff to meet the requirements of this
Agreement, including all Schedules and Exhibits hereto.

4.11                        Customer Service.  Servicer shall implement,
maintain and monitor all Services which interface with Borrowers in accordance
with the Customer Service Schedule, which shall include without limitation

(a)                                Minimum customer service hours of operation;

(b)                                 Call monitoring and quality control; and,

(c)                                Borrower customer satisfaction surveys.

4.12                        Borrower Correspondence.  FMC shall have the right
to request changes to, and approve the form and substance of, all correspondence
sent to Borrowers that is customizable by the Servicer at the Owner level (as
opposed to a guarantor level), including but not limited to pre-repayment
letters and collection correspondence that Servicer is required to send to
Borrowers pursuant to the Servicing Guidelines or any federal or state
regulation. Servicer’s inability to customize at the Owner level shall not
excuse its obligation to comply with all applicable laws. Borrower
correspondence approved pursuant to this Section 4.12 shall become part of the
Program Manual. Requested changes to letters shall be completed within a timely
manner in accordance with a schedule adopted at an Operations Meeting.

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4.13                        Collections.  All sums received by the Servicer with
respect to any Student Loans, whether attributable to principal or interest
shall be received in trust for the benefit of the Owner.  All funds received on
behalf of Borrowers shall be deposited in a Servicer-owned and maintained
clearing account, that is a separate account in which funds are not commingled
with Servicer’s non-collection account funds.  Within two (2) Business Days, all
available funds from Student Loans shall be electronically transmitted to an
account designated by FMC.

4.14                        Late Fees.  FMC and Servicer agree that a Borrower
in repayment status (which refers to a Borrower’s Student Loan Serviced under
the terms of this Agreement for which, under the terms of the Borrower’s Credit
Agreement(s), the repayment period has commenced, and includes Accounts in
post-grace period deferment or forbearance) may be assessed late fees when
payments are overdue, to the extent allowed by applicable law and the terms of
the Credit Agreement(s), subject to FMC’s approval of late fee systems, and in
accordance with the terms of this Section (herein referred to as “Late Fees”). 
FMC or FMC’s affiliate First Marblehead Data Services, Inc (“FMDS”), in its
capacity as SPE administrator, shall notify Servicer, in writing, of the Late
Fees criteria which such party desires the Servicer to apply to each Student
Loan type.  Such criteria shall include, but not be limited to, Late Fee
amounts, time period and applicable state law in which Late Fees will be
assessed to Student Loan Accounts.  FMC or FMDS, as applicable, may establish
different Late Fee criteria for Student Loans having different owner codes.  FMC
or FMDS, as applicable, directions as to Late Fee criteria shall apply to all
loans, including those owned by an SPE.  Late Fee criteria for some product
types may include “no late fee.”  The Servicer reserves the right to submit
questions pertaining to the requirements regarding the assessment of Late Fees
to a particular Student Loan portfolio and FMC or FMDS, as applicable, shall
respond to Servicer’s questions within thirty (30) days. Late Fees shall be
deducted from any payment(s) received from Borrowers as directed by FMC or FMDS,
as applicable.  FMC agrees that Late Fees shall not be included in the amount of
a claim if a default claim is submitted to the Insurer.

4.15                        Privacy Policies.  Servicer shall mail Owner’s
privacy policy statement (a) to the Borrower(s) on each Student Loan, within 45
days after the Owner purchases such loan, and (b) annually thereafter to all
Borrowers.  The Servicer will amend this process as necessary to comply with any
changes to this law.

4.16                        Reports and Forms. During the term of this
Agreement, the Servicer shall promptly and routinely furnish to FMC, sorted by
SPE Owner, and to each Owner copies of all material reports, records, and other
documents and data as required by the Servicing Guidelines or as otherwise
required by this Agreement, including the reports set forth on the Required
Reports Schedule.  All monthly reports shall be delivered in accordance with (a)
the data security requirements of the Secure Communication Protocol made a part
of the Program Manual, and (b) the Required Reports Schedule, unless otherwise
expressly provided for herein. In the event that any reports are not delivered
to FMC as provided for herein, all fees due and owing the Servicer under this
Agreement may be withheld until such reports

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are received by FMC.  The Servicer shall not have failed this standard if
reports are delayed for any reason beyond its control. The Servicer shall
furnish in good condition all forms and supplies necessary or appropriate to
perform the Services, such as letters, invoices, and forbearance applications,
as specified in the Schedule(s) and any written and signed amendments thereto.

4.17                        Governmental Reporting.  The preparation and
submission of any and all governmental reports or requests for data shall be the
responsibility of FMC.  The Servicer shall, however, supply supporting data and
reports as required by this Agreement, including all Schedules and Exhibits
hereto, without additional charge. Subject to Servicer’s reasonable charges,
Servicer shall also provide such other information (not otherwise required
hereunder) as may be reasonably required under applicable law or this Agreement
to enable FMC to fulfill Insurer or governmental reporting requirements, and
otherwise for FMC’s business.  Servicer shall provide reports on form 1098E and
1099 to borrowers and the U.S. Internal Revenue Service.

4.18                        Reports to Consumer Reporting Agencies.  The
Servicer shall provide any and all reports on Accounts serviced hereunder
required by the applicable law, this Agreement, including without limitation the
Servicing Guidelines, to the appropriate Consumer Reporting Agencies or credit
information service and shall correct any errors caused by the incorrect
reporting of information, in a timely manner not to exceed thirty (30) days.
Servicer shall report to all national Consumer Reporting Agencies, which are
currently Experian, Equifax, and Transunion.  After any sale of Committed
Student Loans to an SPE, Servicer shall promptly, but not later than the end of
the reporting period for that month, correct its reporting to show the correct
name of the new Owner in the report, together with the name of the originating
Program Lender. If FMC directs Servicer to make a report or correction of credit
information to a Consumer Reporting Agency that is outside the Servicer’s
customary practices, including but not limited to as part of a legal settlement
with a Borrower, then the Servicer may condition making such report or
correction on the completion of an acceptable writing that allocates the
compliance, regulatory, and legal risk of making the requested report or
correction.

4.19                        Data Error Correction; Account Adjustment.  In the
event that any data file transmitted to FMC or any Owner or any Account contains
a material error, Servicer shall, within one (1) calendar day of discovery of
such error, notify FMC or the affected Owners of such error. Servicer shall use
best efforts to provide a corrected file as soon as possible but no later than
[**] calendar days. For purposes of this Section 4.19, a material error
includes, without limitation:

(a)                                  Failure to follow data format requirements
or file naming conventions established by the parties

(b)                                 Data corruption

(c)                                  More than [**] of the entries in the file
are substantively incorrect (e.g., misposting)

(d)                                 Failure of the file properly to link data to
other files delivered by Servicer, or

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(e)                                  Any systemic error in the file (e.g.,
failure to update LIBOR Index).

Without limiting the foregoing, if FMC or any Owner requests that the Servicer
make any correction or adjustment to any Account, the Servicer shall provide
written confirmation that the correction or adjustment has been made.

4.20                        Identity Theft Procedures. The parties hereby adopt
the Identity Theft Procedures, as set forth in the Servicing Guidelines attached
hereto and as amended from time to time by agreement of the parties or as
required by applicable law.  FMC and the Servicer may suggest changes to the
Identity Theft Procedures from time to time or as required by applicable law.

SECTION 5.  AFFIRMATIVE COVENANTS

 

From the date hereof, Servicer covenants and agrees to the following:

 

5.01                        Government Approvals.  The Servicer shall maintain
all licenses, permits, approvals and qualifications necessary to carry out its
obligations under this Agreement.

 

5.02                        Insurance.  Servicer and subcontractors engaged by
Servicer to provide Services under this Agreement shall also be required to
maintain the insurance described herein at limits acceptable to Servicer and
FMC:

 

(a) Commercial General Liability insurance on an occurrence basis, on Insurance
Services Office (“I.S.O.”) form CG 00 01 or its equivalent, at a limit not less
than [**] per occurrence/[**] aggregate. This insurance shall be endorsed to
include as Additional Insured “FMC and its subsidiary and affiliated companies,
as their interests may appear.” The required limits may be arranged through a
combination of primary and excess policies, as needed. A copy of the additional
insured endorsement must be attached to the certificate of insurance Servicer
provides to FMC.

 

(b) Automobile Liability insurance for any vehicles operated by the Servicer or
its employees in connection with work or Services performed under this
Agreement, including owned, non-owned, borrowed, and hired autos, at limits not
less than [**] per accident.

 

(c) For contracts where Servicer’s personnel will have access to or control over
physical or electronic property of FMC or Owner and/or their customers and/or
clients, Employee Dishonesty coverage (also known as a Fidelity Bond), covering
all employees and agents of the Servicer, at a limit not less than [**] for each
occurrence . This policy shall be endorsed to include as Loss Payees “Owner and
its subsidiary and affiliated companies, as their interests may appear,” and
shall extend to the misappropriation of physical or electronic property of
others in the possession or control of Service Personnel. Servicer shall provide
FMC with a copy of this policy prior to commencing work upon FMC’s request, and
thereafter annually upon FMC’s reasonable request. A copy of the Loss Payee
endorsement or provisions shall also be attached to any certificate of insurance
Servicer provides to FMC as evidence of this coverage.

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All coverage shall be maintained with insurers licensed to transact insurance
business in the state(s) where Servicer maintains offices or operations. The
insurers shall have an A. M. Best rating of A- or better; deviations from that
standard are subject to review and approval by FMC. Servicer shall furnish
Certificates of Insurance and any required copies of policies or endorsements
prior to commencing any work under this Agreement and thereafter within 10 days
of the renewal or replacement of any of the insurance policies described in the
Certificates. Certificates of Insurance shall include an undertaking by the
insurer to provide 30 days prior written notice of cancellation or material
change in coverage(s).

Upon FMC’s request, Servicer shall provide FMC with a copy of any policy or
endorsement required hereunder. Regardless of any limitations to any
indemnification of FMC or Owner by Servicer as may be stated elsewhere in this
Agreement, Servicer expressly understands and agrees that if Servicer fails to
maintain any of the required insurance coverages, Servicer shall be directly
liable for claims that would otherwise be covered by the insurance required of
Servicer, its vendors and/or subcontractors. Servicer shall also be responsible
for the payment of any applicable deductibles.

 

5.03                        Notification.  Servicer shall promptly notify FMC in
writing of (a) the occurrence of any event which, if it had existed on the date
of this Agreement, would have required qualification of the representations and
warranties set forth in Section 6 (Representations and Warranties) herein; (b) a
Material Adverse Change, including but not limited to, material financial
difficulty, other catastrophic event, material change in strategic goals, or
significant staffing changes; or (c) any material litigation which if adversely
determined would cause a Material Adverse Change.

 

5.04                        Accuracy of Reports.  All reports, transmittals,
records or data files required, maintained or provided by Servicer hereunder
shall be accurate in all material respects, and FMC shall have the right to rely
thereon.

 

5.05                        Work Performed in United States.  Unless this
Agreement specifically provides otherwise, all Services must be performed in the
United States and all Proprietary Information and Customer Information, must be
stored, maintained, accessed from, and utilized only by employees and
sub-contractors in the United States.

 

5.06                        No Subcontractors. With the exception of skip
tracing services, the Servicer shall not utilize or engage a subcontractor to
perform any Services under this Agreement without the prior written consent of
FMC.  To the extent subcontractors perform any services under this Agreement,
the Servicer shall be liable for the performance of such subcontractors.  Any
subcontractors who are approved by FMC and persons hired by Servicer for skip
tracing services must sign FMC’s standard form of Confidentiality Agreement and
are subject to the confidentially and privacy and security obligations of
Section 14.07 hereof. Servicer shall advise FMC upon periodic request of the
entities to which it has subcontracted skip tracing services.

 

5.07                        OFAC Check.  All Servicer employees performing
Services or supporting Servicer activities under this Agreement, regardless of
their location, shall be validated by Servicer to not be on any list published
and maintained by the Government of the United States of America of persons or
entities with whom any U.S. person or entity is

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prohibited from conducting business.  Currently, the lists of such persons or
entities can be found on the following web site:

 

The Specialty Designated Nationals and Blocked Persons List of the Office of
Foreign Assets Control — Department of Treasury at
http://www.ustreas.gov/offices/enforcement/ofac/sdn/index.html.

 

In the event of Servicer becoming aware of any Servicer employee involved in
providing Services being included in the list of prohibited persons or entities,
Servicer shall provide FMC with immediate notice thereof.

 

Servicer shall conduct periodic reviews, no less frequently than quarterly, of
the lists mentioned above.  Servicer shall report to FMC immediately if the name
of any Servicer employee performing the Services matches with the name of any
person listed on any list published by the Government of the U. S. of persons or
entities with whom any U. S. person or entity is prohibited from doing business.

 

5.08                        FACT Act, PATRIOT Act and OFAC Check.  Servicer’s
performance of its Servicing obligations under this Agreement in conformity with
all applicable laws shall include, without limitation, compliance with the
requirements imposed on Owner and Insurer as users and furnishers of consumer
report information under the Fair and Accurate Credit Transactions Act of 2003
and all regulations issued pursuant thereto, including, without limitation,
timely and lawful response to any identity theft report received from any
Borrower or consumer reporting agency and the obligation to respond to a credit
report reinvestigation request in accordance with the Identity Theft
Procedures.  Servicer shall notify Owner if it becomes aware that any Borrower
is on any list published and maintained by the government of the United States
of America of persons or entities with whom the Owner’s transaction of business
is restricted, as those lists are currently set forth in Section 5.07 above and
as may be hereafter required by applicable law.

 

5.09                        Further Assurances.  At any time, upon the
reasonable request of FMC (or its nominee) or any Owner (or its nominee), and
subject to Servicer’s reasonable charges and reimbursement of any out-of-pocket
expenses, Servicer shall execute and deliver to such requesting party or its
designee such other certificates, agreements and instruments and take such
actions as such requesting party or its designee may reasonably request in
connection with its compliance with any legal or regulatory requirements,
including, without limitation, any certifications required to be delivered by
such requesting party under any Securities and Exchange Commission or other
securities requirement or in connection with the Sarbanes-Oxley Act of 2002.

 

SECTION 6.  REPRESENTATIONS AND WARRANTIES

 

The Servicer represents and warrants to FMC (and these warranties and
representations shall be deemed continuing and repeated as of the date each
Student Loan shall become subject to this Agreement) as follows:

 

6.01                        Existence.  The Servicer is a public corporation
duly organized and validly existing and

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in good standing under the laws of the Commonwealth of Pennsylvania, and is duly
qualified to do business in all jurisdictions where its failure to so qualify
would materially impair its ability to perform its obligations under this
Agreement.

6.02                        Right to Act. No registration with or approval of
any governmental agency (except for approval as to form and legality by the
Attorney General for the Commonwealth of Pennsylvania) is required for the due
execution and delivery or enforceability of this Agreement. The Servicer has
legal power to execute and deliver this Agreement under the laws of Pennsylvania
and to perform such Services and observe the provisions herein under the laws of
Pennsylvania. By executing and delivering this Agreement, and by performing and
observing the provisions of this Agreement, the Servicer will not violate any
existing provision of its Articles of Incorporation or its bylaws or any
applicable law or violate or otherwise become in default under any existing
contract or other obligation binding upon the Servicer. The officers executing
and delivering this Agreement have been duly authorized to do so, and this
Agreement is legally binding upon the Servicer and enforceable against the
Servicer in every respect.

6.03                        Intellectual Property and Software Rights.
 Servicer’s performance of its obligations under this Agreement will not
infringe any patent, trademark, copyright, or any trade secret or other
proprietary right of any third party. Servicer is the lawful owner or licensee
of any software programs or other materials used by Servicer in the performance
of the Services called for in this Agreement.

6.04                        Accuracy and Continued Validity of Servicer’s
Financial Status.  The Servicer has furnished to FMC financial reports, which in
the opinion of the Servicer fairly and accurately reflect the financial
operations of the Servicer and there has been no Material Adverse Change in the
Servicer’s financial prospects since the date the report was provided which
would require revision of the same.  No representation or warranty made by the
Servicer under this Agreement and no statement made by the Servicer in any
financial statement, certification, report, exhibit or document furnished by the
Servicer to FMC pursuant to or in connection with this Agreement is false or
misleading in any material respect (including by omission of material
information necessary to make such representation, statement or warranty not
misleading) as of the date given or made.

6.05                        OFAC Check.  Neither Servicer ,nor any of its
subsidiaries, Affiliates, directors, officers, agents, or employees is

(a)                                  an individual or entity that is listed in
the annex to, or is otherwise subject to the prohibitions contained in,
Executive Order No. 13224 on Terrorist Financing, effective September 24, 2001
(the “Executive Order”) or the Office of Foreign Asset Control (“OFAC”)
regulations;

(b)                                 an individual or entity with whom FMC is
prohibited from dealing or otherwise engaging in business under any U.S. law,
regulation, executive order and/or lists published by OFAC (including those
executive orders and lists published by OFAC);

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(c)                                  an individual or entity that is named on
the most current list of “Specially Designated Nationals and Blocked Persons”
published by OFAC on its official website or any replacement website or other
replacement official publication of such list; or

(d)                                 an individual or entity with which any
financial institution is prohibited from dealing or otherwise engaging in any
transaction under any laws or regulations related to terrorism or money
laundering.

6.06                        Ongoing Obligation.  If at any time during the term
of this Agreement, any of the representations contained in this Section 6 are no
longer true, Servicer will immediately notify FMC, and FMC shall have the
immediate right to terminate this Agreement, without further obligation or
penalty.  FMC will not be required to pay any Early Termination or Record
Return/Deconversion fee if this Agreement is terminated pursuant to this Section
6.06.

SECTION 7.  INSPECTIONS: AUDITS

7.01.                     FMC Audit of Books and Records. FMC, its accountants,
auditors, representatives and any Federal, state or local governmental or
quasi-governmental officials with regulatory authority over FMC or FMC
Affiliates shall have the absolute right, at FMC’s expense, upon not less than
twenty (20) days prior notice (or such shorter notice period as required by
law), at any time during or after the term hereof:

(i) to audit or examine all books, records, documents, other writings,
information, whether in hard copies, electronic form or otherwise, relating to
Services to be provided by Servicer under this Agreement at the location(s)
where Servicer maintains such books, records, documents, writings and
information; and

(ii) to conduct such other examinations, tests or investigations with respect to
the Services to be provided under this Agreement as FMC may deem necessary or
desirable in FMCs sole and absolute discretion and at FMC’s expense, it being
acknowledged and agreed by Servicer that FMC shall have full and unrestricted
rights of access to books, records, documents, other writings and information,
whether in hard copies, electronic form or otherwise, relating to the Services
to be provided by Servicer under this Agreement, at any time during normal
business hours.

7.02.                     Sarbanes Oxley Compliance. If requested by FMC,
Servicer shall participate in Sarbanes-Oxley Act of 2002 (“Sarbanes Oxley”)
compliance testing conducted by FMC with respect to the Services on a quarterly
basis and shall provide documents and information as reasonably requested by FMC
to conduct such compliance testing. Servicer agrees to provide any assistance
reasonably requested by FMC to enable FMC to comply with Sarbanes Oxley, the
rules of the Public Company Accounting Oversight Board and rules of the
Securities and Exchange Commission relating to disclosure controls and
procedures and inquiries by the SEC or other regulatory agency. Such

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assistance shall include but shall not be limited to: (i) documenting Servicer’s
controls and procedures relating to the Services; (ii) cooperating with FMC’s
auditors in connection with the testing of such controls and procedures; (iii)
making quarterly representations or certifications to FMC regarding any material
changes to such controls and procedures; (iv) remediating any material weakness
or significant deficiency that would prevent FMC from complying with Sarbanes
Oxley or any rules or regulations promulgated thereunder; and (v) providing an
unqualified SAS 70 Type 2 Report issued by an independent certified public
accounting (CPA) firm in connection with its provision of the Services.

7.03.                     SAS 70 Audit. Servicer will engage, at its expense, an
independent CPA firm that adheres to professional standards established by the
American Institute of Certified Public Accountants (AICPA) to conduct reviews of
Servicer’s general controls associated with Servicer’s facilities, as well as
the controls associated with the Services and the programs used to provide the
Services, including but not limited to controls over information technology and
related processes, The scope of the audit shall include all such matters as
Servicer’s auditor deems necessary or required to meet regulatory compliance
standards, including but not limited to an examination of the record keeping
system and other equipment and software used by Servicer. Such reviews shall be
performed at such frequency and times as Servicer shall determine, but shall be
performed at least once annually. Within thirty (30) days of its receipt by
Servicer, Servicer shall provide FMC with a copy of each report submitted by
Servicer’s independent accountants regarding any of the matters set forth in
this paragraph. All such reviews shall comply with AICPA Statement on Auditing
Standards (SAS) No. 70, and the reports obtained shall be of the type generally
referred to (depending on the publication) as either Type “II” or “B”. In a Type
II report, the Servicer auditor will express an opinion on (1) whether the
Servicer’s organization description of its controls presents fairly, in all
material respects, the relevant aspects of the Servicer’s organization controls
that had been placed in operation as of a specific date, and (2) whether the
controls were suitably designed to achieve specified control objectives, and (3)
whether the controls that were tested were operating with sufficient
effectiveness to provide reasonable, but not absolute, assurance that the
control objectives were achieved during the period specified. If the Servicer’s
auditor procedures reveal exceptions or control deficiencies, then Servicer
shall take steps to correct the control objective, at no cost to FMC.

7.04.                     Operational Audits. Upon twenty (20) days notice from
FMC, and subject to Servicer’s reasonable security requirements, Servicer shall
provide to FMC (and FMC’s internal and external auditors, inspectors, regulators
and other representatives that FMC may designate from time to time) access at
reasonable hours to Servicer’s personnel, to the facilities at or from which
Services are then being provided, and to Servicer’s records and other pertinent
information, all to the extent relevant to the Services and Servicer’s
obligations under this Agreement. Such access shall be provided for the purpose
of performing audits and inspections of Servicer and its businesses and to
examine Servicer’s performance of loan servicing under this Agreement including
(i) verifying the integrity of the Servicer data; (ii) examining the controls
(e.g., organizational controls, input/output controls, system modification
controls, system design controls and access controls) and the security, disaster
recovery and back-up practices and procedures; (iii)

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examining Servicer’s measurement, monitoring and management tools; and (iv)
enabling FMC to meet applicable legal, regulatory and contractual requirements.
Servicer shall provide any assistance reasonably requested by FMC or its
designee in conducting any such audit.

7.05                        Regulatory Audits. Within thirty (30) days of its
receipt, Servicer shall provide FMC with a summary of any audit results
performed by a federal or state regulator concerning the Services provided under
this Agreement, including but not limited to the Department of Education. The
content of any such summary shall be subject to Servicer’s reasonable security
requirements. When the regulatory auditor’s procedures reveal exceptions or
control deficiencies, then Servicer shall take steps to correct the control
design deficiency or operating effectiveness deficiency in all material
respects. If such audit reveals that the services provided by Servicer do not
cause Servicer’s operations to meet the auditor’s recommendation, then Servicer
shall provide such further services as are necessary to bring its operations
into conformance with the auditor’s recommendations to such level and degree, at
no cost to FMC.

7.06.                     Financial and Other Information. Servicer shall
provide FMC with the following:

(a) Within forty-five (45) days after the end of each of the first three
quarters of each fiscal year, unaudited financial statements of Servicer for
such quarter, setting forth the information called for as of the end of, and for
such quarter as described in paragraph (b) of this Section 7; and

(b) Within 120 days after the close of each fiscal year of Servicer, a copy of
an annual report as to the obligations and activities of Servicer during such
fiscal year, and financial statements for such fiscal year, setting forth in
reasonable detail:

(i) the balance sheet for Servicer and its programs showing the assets and
liabilities of the programs at the end of such fiscal year;

(ii) a statement of Servicer’s revenues and expenses in accordance with the
categories or classifications established by Servicer for its operating and
program purposes and showing the revenues and program expenses during such
fiscal year; and

(iii) a statement of changes in financial position, including changes in
financial position of Servicer’s programs, as of the end of such fiscal year.

The annual report shall be accompanied by an Independent Auditor’s Report
stating that the financial statements present fairly, in all material respects,
the net assets of the Servicer as of the years stated, and its changes in net
assets and cash flows for the years then ended, in conformity with accounting
principles generally accepted in the United States of America.

7.07.                   Annual Statement as to Compliance. The Servicer shall
deliver an annual report to FMC on or prior to March 31 of each year commencing
March 31, 2006, signed by the Chief Executive Officer (“CEO”) or Executive Vice
President (“EVP”) of the Servicer,

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stating that (a) a review of the activities of the Servicer, and the Servicer’s
Performance under this Agreement, for the previous twelve (12) months ending
September 30 has been made under such CEO’s or EVP’s supervision and (b) to the
best of such CEO’”s or EVP’s knowledge, based on such review, the Servicer has
or has caused to be performed all of its obligations under this Agreement
throughout such year and that no default has occurred, or if such a default has
occurred and is continuing, specifying each such event, the nature and status
thereof and the steps necessary to remedy such affair. In the event that the
Servicer has delegated any servicing responsibilities with respect to the
Student Loans to a subservicer or subcontractor, the Servicer shall deliver a
similar annual report by any such subservicer or subcontractor as described
above as and when required with respect to the Servicer.

7.08.                     Annual Independent Public Accountant’s Servicing
Reports; Assessments of Compliance and Attestation Reports. On and after January
1, 2006, the Servicer shall service and administer all Student Loans in
accordance with all applicable requirements of the servicing criteria set forth
in Item 1122(d) (the “Servicing Criteria”) of Regulation AB (17 C.F.R. §§
229.1100 - 229.1123) (“Regulation AB”) promulgated by the Securities and
Exchange Commission (the “SEC”) under the Securities Act of 1934, as amended
(the “Exchange Act”).  Pursuant to Rules 13a-18 and 15d-18 of the Exchange Act
and Item 1123 of Regulation AB, the Servicer shall deliver to FMC, the related
Trustee and any other Permitted Assignee, at the cost and expense of FMC, the
Trustee, or a Permitted Assignee, on or before August 31 of each year commencing
in 2006, a report regarding the Servicer’s assessment of compliance (an
“Assessment of Compliance”) with the Servicing Criteria during the previous
twelve (12) months ending June 30.  The Assessment of Compliance must be
reasonably satisfactory to the related Trustee, and as set forth in Regulation
AB, the Assessment of Compliance must contain the following:

(a)                                  A statement by a Servicing officer of such
Servicing officer’s responsibility for assessing compliance with the Servicing
Criteria applicable to the Servicer;

(b)                                 An assessment by such Servicing officer of
the Servicer’s compliance with the applicable Servicing Criteria for the period
consisting of the previous twelve (12) months ending June 30, including
disclosure of any material instance of noncompliance with respect thereto during
such period, which assessment shall be based on the activities the Servicer
performs with respect to asset-backed securities transactions taken as a whole
involving the Servicer, that are backed by the Student Loans;

(c)                                  A statement that a registered public
accounting firm has issued an attestation report on the Servicer’s Assessment of
Compliance for the period consisting of the previous twelve (12) months ending
June 30; and

(d)                                 On or before August 31 of each year
commencing in 2006, the Servicer shall furnish to FMC, the related Trustee and
any other Permitted Assignee a report (an “Attestation Report”) by a registered
public accounting firm that attests to, and reports on, the Assessment of
Compliance made by the Servicer, as required by

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Rules 13a-18 and 15d-18 of the Exchange Act and Item 1122(b) of Regulation AB,
which Attestation Report must be made in accordance with standards for
attestation reports issued or adopted by the Public Company Accounting Oversight
Board.

The Servicer shall cause any subservicer, and any subcontractor determined by
the Servicer to be “participating in the servicing function” within the meaning
of Item 1122 of Regulation AB, to deliver to FMC, the related Trustee and any
other Permitted Assignee an Assessment of Compliance and Attestation Report as
and when provided above.

Each of the parties to this Agreement acknowledges and agrees that the purpose
of this Section 7.08 of this Agreement is to facilitate compliance with the
provisions of Regulation AB, as such may be amended from time to time and
subject to clarification and interpretive advice as may be issued by the staff
of the SEC from time to time.  Therefore, each of the parties agrees that (a)
the obligations of the parties hereunder shall be interpreted in such a manner
as to accomplish that purpose, (b) the parties’ obligations hereunder will be
supplemented and modified as necessary to be consistent with any such
amendments, interpretive advice or guidance, convention or consensus among
active participants in the asset-backed securities markets, advice of counsel,
or otherwise in respect of the requirements of Regulation AB, (c) the parties
shall comply with requests made by FMC, the Administrator, any Trustee or other
Permitted Assignee for delivery of additional or different information as FMC,
the Administrator, any Trustee or other Permitted Assignee may determine in good
faith is necessary to comply with the provisions of Regulation AB, and (d) no
amendment of this Agreement shall be required to effect any such changes in the
parties’ obligations as are necessary to accommodate evolving interpretations of
the provisions of Regulation AB.

7.09                      Cooperation with Audits; Follow-Up. Servicer shall
fully cooperate with any audit(s) conducted by either FMC, FMC’s agent, or a
U.S. federal agency pursuant to this Agreement. Servicer shall not charge FMC
for the management hours or fees with respect to the time spent by Servicer’s
management and employees reasonably necessary in providing assistance to FMC,
FMC’s internal and external auditors, or any governmental authority performing
any audits, compliance, security and control testing. If any audit report
establishes that Servicer’s performance of the Services is not in compliance
with the terms of this Agreement, Servicer shall submit to FMC within thirty
(30) days of its receipt of the relevant audit report a plan to improve
Servicer’s performance to the level required by this Agreement. In the event
that any financial audit report reveals that any changes or expenses have been
overbilled or underbilled, then FMC shall make adjustment in the fees and
invoices as necessary on a prospective basis in future months as necessary to
correct errors or maintain compliance with the Agreement, or Servicer or FMC
shall render a payment to the other party as necessary to correct the
discrepancy.

7.10                        Accelerated and Emergency Audits.  In the event that
FMC has the right to terminate this Agreement under Section 14 (Termination),
whether or not such right is exercised, FMC shall have the right to perform or
cause to be performed any audit, examination or inspection described in this
Agreement, without any limitations or requirements as to

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notice, frequency, duration, business interruption, or other such limitation or
requirement for the benefit of the Servicer. All costs of such an accelerated or
emergency audit shall be borne by FMC.

SECTION 8.  CHARGES AND PAYMENTS.

8.01                        Fees.  The Servicer shall provide all aspect of the
Services at its sole cost and expense, except as otherwise provided in this
Agreement, and shall be compensated as set forth this Agreement, including
without limitation the Fee Schedule.

8.02                        Rate Change.  To the extent that an increase occurs
in the costs incurred by the Servicer in providing the Services hereunder due
to: (a) changes in the Servicing Guidelines or this Agreement, including without
limitation the Service Level Agreement, (b) legislative and regulatory changes
beyond the control of the Servicer which pertain to the manner of servicing of
the Student Loans in accordance with Section 4.01 herein, (c) changes in United
States Postal Service postage rates, or (d) material changes requested by FMC in
the Services provided herein, including but not limited to changes contemplated
in Section 4.09 hereof, the Servicer shall have the right to make a compensating
increase to the Servicing fees set forth herein and in the Fee Schedule.

Such increase shall be limited to Servicer’s actual incremental cost increase
resulting from such changes.  Servicer shall give FMC ninety (90) days prior
written notice before implementing any such increase in Servicing fees pursuant
to this Section. Such notice shall set forth the bases of, as well as the
computation used in determining, any increase.

8.03                        Invoices.  Invoices for the Servicer’s Services,
including the collection of Late Fees collected on behalf of FMC or any Owner as
set forth in Section 4.14 herein and the Fee Schedule, shall be rendered by the
Servicer after each month end with payment to be paid by FMC or the Owner, and
shall be delivered electronically, or, upon request by FMC or the Owner, as a
paper copy. Separate invoices shall be rendered for each Owner.  All invoices
are payable net forty-five (45) days from the date of the invoice.  If full
payment is not received within sixty (60) days of the invoice date, except as to
amounts which are under good faith dispute, the Servicer may assess an interest
charge of [**]% per month ([**]% annual percentage rate) on the unpaid balance
from the date of the initial billing until fully paid.  FMC or the affected
Owner shall report any disputes to the Servicer regarding an invoice for
Servicing within sixty (60) days of the invoice, and the Servicer shall research
the disputed item and respond to FMC or the affected Owner(s).

SECTION 9.  LIABILITY

The Servicer agrees to pay for any claim, loss, liability or expense, including
reasonable attorney’s fees, which arises out of or relates to the Servicer’s
acts or omissions with respect to the Services provided under this Agreement
(including, without limitation, any refusal of the Insurer to pay any claim
based on Servicer’s failure to conform to the Servicing Guidelines), where the
final determination of liability on the part of the Servicer is established by
an arbitrator, by a court of law with competent jurisdiction over the Servicer
or by way of

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settlement agreed to by the Servicer. This provision shall not be construed to
limit the Servicer’s or FMC’s rights, obligations, liabilities, claims or
defenses which arise as a matter of law or pursuant to any other provision of
this Agreement. This provision shall take effect as of the date on which each
individual Student Loan is converted to the Servicer’s servicing system and
shall apply to default claims rejected or paid subject to penalty due to errors
on the part of the Servicer which occur after the date of conversion to the
Servicer’s system. Furthermore, nothing herein shall be read or construed as a
waiver of the sovereign immunity of the Commonwealth of Pennsylvania, except to
the extent authorized by the laws of said Commonwealth.

The Commonwealth of Pennsylvania has created the Board of Claims, pursuant to
the provisions of the act of May 20, 1937, P.L. 728, as amended by the act of
October 5, 1978, Act No. 260, 72 P.S. 4651-1 et seq., for the adjustment of
claims arising from contracts entered into by the Commonwealth or an agency of
the Commonwealth. Subject to the statutory jurisdictional requirements, any and
all claims against PHEAA respecting any matter pertaining to this Agreement or
any part thereof may be instituted in the Board of Claims.

FMC agrees to pay for any claim, loss, liability or expense, including
reasonable attorney’s fees and court costs, arising out of or relating to FMC’s
acts or omissions with respect to the Student Loans covered by this Agreement,
where the final determination of liability on the part of FMC is established by
an arbitrator, by a court of law or by way of settlement agreed to by FMC. This
provision shall not be construed to limit FMC’s or the Servicer’s rights,
obligations, liabilities, claims or defenses which arise as a matter of law or
pursuant to any other provision of this Agreement.

If the Insurer rejects a claim on account of Servicer’s failure to conform to
the Servicing Guidelines in Servicing a Student Loan, the Servicer will start
the cure process described in the Servicing Guidelines for the purpose of
reinstating FMC’s or any Owner’s claim against the Insurer. (Student Loans in
such status are hereinafter referred to as Student Loans in “Cure Status”). An
indicator will be placed in the Student Loan record indicating the start (and
the date) of Cure Status. Within twelve (12) months of the initiation of Cure
Status, if Insurance has not been reinstated in accordance with the Servicing
Guidelines, the Servicer shall purchase any such Student Loan by paying to FMC
or the Owner (as applicable) an amount equal to the principal balance and all
accrued and unpaid interest through the date of purchase. The Owner will assign
its right, title and interest in any Credit Agreement to the Servicer where the
Servicer has purchased such note. Within thirty (30) days after a final
determination pursuant to Section 9 that Servicer was not responsible for
causing the loss of Insurance, FMC will repurchase any and all such uninsured
Student Loans for an amount equal to the purchase price plus any other costs
incurred by Servicer in their purchase.

SECTION 10.  FORCE MAJEURE

10.01                 Neither Servicer nor FMC shall be liable for any failure
or delay in the performance of its obligations under this Agreement to the
extent such failure or delay is caused by any acts of war, terrorism, civil
riots or rebellions, quarantines, embargoes and other similar unusual
governmental actions, extraordinary elements of nature or acts of God, judicial
or governmental action, emergency regulation or labor dispute or unrest,
provided that and only to the extent that Servicer or FMC could not reasonably
circumvent the failure or delay through the use of commercially reasonable
alternate sources, workaround plans or

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other means (“Force Majeure”). An event shall not be considered a Force Majeure
event to the extent that proper implementation of the Business Continuity Plan
(as defined below) would have enabled the Servicer to continue performance
hereunder in a timely manner. The occurrence of a Force Majeure event shall not
excuse the Servicer from having in place reasonable safeguarding plans and
procedures adequate for protecting all Proprietary Information and Customer
Information of FMC and any Owner.

Notwithstanding any other provision of this Section, a Force Majeure event shall
obligate and require Servicer to commence its Disaster Recovery Plan (as defined
below). If any Force Majeure event prevents, hinders or delays performance of
the critical Services for more than three (3) days or results in data loss in
excess of forty-eight (48) hours, FMC may procure any affected Services from an
alternate source at FMC’s cost and expense.  If the Force Majeure event
continues to prevent, hinder or delay performance of any Services which are of a
critical nature for an additional four (4) days, FMC shall have the right to
terminate this Agreement on not less than fifteen (15) days prior written notice
to Servicer, provided that Servicer will be responsible to continue Services up
to the effective date of such termination.  FMC shall not be required to pay any
Early Termination or Record Return/Deconversion Fees for a termination of this
Agreement pursuant to this Section.

10.02                 Without limiting Servicer’s obligations under this
Agreement, whenever a Force Majeure event causes Servicer to allocate limited
resources between or among Servicer’s customers, FMC and any Owner, as
applicable, shall be treated at least as favorably as Servicer’s most favored
customers.

 SECTION 11.  CONFIDENTIAL INFORMATION/PRIVACY/SECURITY

11.01.              Proprietary/Confidential Information.  Each party
understands and acknowledges that in the performance of this Agreement, each
party (the “Recipient”) will gain access to certain nonpublic information,
material and data, hereinafter referred to as “Proprietary Information”,
relating to the other party (the “Disclosing Party”), which may include, but not
be limited to, FMC’s customer information, the Disclosing Party’s technical and
financial data, design, process, procedures, formula, business logic,
presentation or strategy, new products and marketing plans that are commercially
valuable to such Disclosing Party and all trade secrets, ideas, know-how, data,
compilations, inventions, literary, artistic, graphical or other works and
improvements, in each case whether or not patentable, copyrightable or otherwise
subject to intellectual or industrial property protection, and whether or not
registrable or subject to any registrations or applications therefor, and any of
the same relating to or owned by any subsidiary or affiliate of the Disclosing
Party.

(i)                                     Recipient agrees to keep all such
Proprietary Information confidential, and not disclose, transfer, use, copy, or
allow any employees or any third parties access to any such Proprietary
Information, except for those who have a need to know such Proprietary
Information in order for the Recipient to accomplish the requirements of this
Agreement and who are individually bound by contractual obligations of
confidentiality and limitation of use sufficient to give effect to this Section
11. Recipient will (a) keep all documents and any other material

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containing or incorporating any of the Proprietary Information at the usual
place of business of Recipient, subject to physical access restrictions
acceptable to Disclosing Party, (b) not use, reproduce, transform or store any
of the Proprietary Information in any externally accessible computer or
electronic information retrieval system unless such system is adequately
protected against unauthorized access, and (c) make copies of the Proprietary
Information only to the extent that the same is required pursuant to the
purposes of this Agreement. In no event shall Recipient disclose any such
Proprietary Information to any competitors of Disclosing Party.  In the event of
a joint venture between Servicer and another entity, Servicer agrees to maintain
the confidentiality of all such Proprietary Information of FMC and not to
disclose the same in any manner to the joint venture entity without the prior
written consent of FMC.  Upon request by the Disclosing Party and upon
termination of this Agreement, the Recipient shall promptly return all such
Proprietary Information retaining no copies and remove any copies of the
Proprietary Information in any form whatsoever on the Recipient’s computer and
information storage systems.  Recipient shall also provide to the Disclosing
Party a written certification of destruction signed by an officer of the
Recipient duly authorized to legally bind the Recipient certifying and
warranting that no copies of the Proprietary Information have been retained. 
Recipient agrees and understands that the Disclosing Party retains all right,
title and interest in and to all of its Proprietary Information and any
intellectual property and industrial rights therein, including (without
limitation) any patents, copyrights and registrations thereof and applications
therefor, and the Disclosing Party will have all the rights and remedies
available to it as a result of such right, title and interest.  This Agreement
does not grant or constitute an assignment of or license in or to any such
Proprietary Information or intellectual or industrial property, including,
without limitation, for the development, manufacture or sale by Recipient of
products or services based on Proprietary Information or for any other use of
Proprietary Information by Recipient except as expressly provided herein.

(ii)                                  Recipient’s duty hereunder shall not
extend to such Proprietary Information which (a) is rightfully received by
Recipient from a third party under no duty of confidentiality to the Disclosing
Party; (b) is approved in writing by Disclosing Party for disclosure;  (c) is
already in the public domain or which, after disclosure, becomes part of the
public domain or otherwise generally available to the public through publication
or otherwise through no fault of the Recipient (d) the Recipient can show is
lawfully in its possession at the time of disclosure and was not acquired,
directly or indirectly, from the Disclosing Party or anyone else who, to the
knowledge of the Recipient, was subject to any obligations of confidentiality to
the Disclosing Party, (e) developed independently from the Disclosing Party and
which the Recipient can show by contemporaneous records were developed without
reference to the Disclosing Party’s Proprietary Information or (f) is compelled
by a validly issued subpoena, court order, governmental request or request of a
law enforcement agency.

(iii)                               Recipient acknowledges that the Disclosing
Party shall have the right to take all reasonable steps to protect their
interests in keeping the Proprietary Information and the Confidential
Information confidential, including, but not limited to, injunctive relief and
any other remedies as may be available at law or in equity in the event
Recipient does not fulfill its obligations under this Section 6.

11.02                 Privacy.          Each Party shall comply with all federal
and state laws, and rules

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and regulations of applicable regulatory agencies, protecting the Confidential
Information and privacy rights of FMC, its customers and consumers, including,
without limitation, Title V of the federal Gramm-Leach-Bliley Act and federal
regulations implementing such act, Interagency Guidelines Establishing Standards
For Safeguarding Customer Information and codified at 12 C.F.R. Parts 30, 208,
211, 225, 263, 308, 364, 568, and 570. and the federal Economic Espionage Act
(18 U.S.C. Section 1831 et seq). Servicer will not directly or indirectly reuse
or redisclose to any Affiliate (as defined below), or any unaffiliated entity or
person, any Confidential Information, including but not limited to, any
personally identifiable consumer information, provided by FMC under this
Agreement for any purpose other than to perform the activities contemplated by
this Agreement. All Confidential Information in the possession of Servicer,
other than information independently obtained by Servicer and not derived in any
manner from information obtained under or in connection with this Agreement, is
and shall remain confidential and proprietary information of FMC, TERI, and/or
the applicable Program Lender. If Servicer proposes to disclose Customer
Information to any person or entity to assist Servicer to perform its duties
under this Agreement, Servicer shall first enter into a written confidentiality
agreement with such person or entity under which that person or entity would be
restricted from disclosing, using or duplicating such Customer Information,
except as contemplated under this Agreement.  Notwithstanding any such
confidentiality agreement, Servicer shall remain liable to FMC, Program Lender
or any Owner, as applicable, for any failure of such person or entity to comply
with such confidentiality agreement to the extent that such noncompliance, if
engaged in by Servicer, would be a breach of this Agreement.

For purposes of this Agreement “Affiliates” means all current or future
corporations that directly or indirectly, through one or more intermediaries,
Control (as defined below) or are Controlled by, or are under common Control
with, FMC or Servicer  or that are successors (whether by change of name,
dissolution, merger, consolidation, reorganization or otherwise) to any such
corporations or their businesses and assets.  “Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management and policies of an entity through the majority ownership of voting
securities.

For purposes of this Agreement, “Confidential Information” shall mean all data;
records; correspondence; reports; borrower lists; documents; any personally
identifiable information or records in any form (oral, written, graphic,
electronic, machine-readable, or otherwise) relating to a Borrower, including,
but not limited to: a Borrower’s name, address, telephone number, social
security number, account number, loan payment or transactional account history,
account status, and the fact that the Borrower has a relationship with a Program
Lender and Owner; other Borrower information; or other documentation received by
Servicer pursuant to the Agreement from FMC, or from the Borrower, or from the
school which Borrower attends, or information prepared and maintained by
Servicer in the course of its activities under this Agreement.

Servicer agrees not to utilize any Confidential Information, including but not
limited to the marketing of products or services to, or the solicitation of
business from, Borrowers, unless it is necessary to do so in order to fulfill an
obligation under this Agreement.  Servicer also agrees that it will not sell,
disclose, transfer, or rent any Confidential Information to any third party nor
will it use any Confidential Information on behalf of any third party, without
the express written

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permission of FMC and the relevant Borrower.  Servicer shall use a digital
certificate on the web server to enable the use of SSL and HTTPS protocols. All
internet transfers of Confidential Information and screen images of the same
shall be encrypted.

Servicer acknowledges that money damages may be both incalculable and an
insufficient remedy for any breach of this provision by Servicer and that any
such breach may cause FMC irreparable harm.  Accordingly, Servicer agrees that
in the event of any breach or threatened breach of this Section, FMC, in
addition to any other remedies at law or in equity that it may have, shall be
entitled without requirement of posting a bond or other security, to equitable
relief, including injunctive relief and specific performance without proof of
actual damages.

11.03                 Security Program.  Notwithstanding anything herein to the
contrary, Servicer may receive or otherwise have access to “Customer
Information” (as defined in Appendix B to 12 CFR §30), in connection with
providing Services to FMC pursuant to the terms of the Agreement.  Servicer
shall implement and maintain an appropriate security program for Customer
Information designed to meet the following Objectives, as defined below, of the
Interagency Guidelines Establishing Standards for Safeguarding Customer
Information pursuant to the authority of Section 501(b) of the
Gramm-Leach-Bliley Act of 1999 (“Information Security Program”).  “Objectives”
means a program designed to (i) ensure the security and confidentiality of
Customer Information (as defined below); (ii) protect against any anticipated
threats or hazards to the security or integrity to Customer Information, and
(iii) protect against unauthorized access to or use of Customer Information that
could result in substantial harm or inconvenience to any “Customer” (as defined
in 12 CFR § 40.3 (h)).  Servicer shall provide FMC on or prior to the Effective
Date and thereafter, upon request, with a copy of its information security and
assurance policy and any updates or amendments thereto. Servicer agrees that
upon reasonable notice and at Servicer’s convenience, FMC may come to Servicer’s
place of business and review the specifics of Servicer’s security plan with
Servicer.  It is understood and agreed that Servicer shall not be required to
have an Information Security Program in place that implements every security
measure listed in each paragraph of Section III C of Appendix A to 12 CFR § 30;
provided that Servicer’s Information Security Program is appropriate to address
the level of risk and otherwise meets the Objectives.  FMC, its internal and
external auditors and regulatory agencies (“Auditors”) shall be permitted,
during normal business hours, to audit the Servicer’s Information Security
Program upon provision of sixty (60) days prior notice and provision of an
agenda for the audit requirements.  Servicer shall provide to the Auditors, upon
request, a copy of a CyberTrust Certification Letter and a Type II SAS 70 Report
which report shall include the operating controls associated with Servicer’s
Information Security Program and tests of those operating controls. Servicer
shall be subject to said audits as long as Servicer continues to maintain, store
or have access to Customer Information.

As part of its information security program, Servicer shall take appropriate
measures to properly dispose of “Consumer Information” and “Customer
Information” as defined in The Interagency Guidelines Establishing Standards for
Information Security (as revised, 12/28/04), 12 CFR Part 30 (Appendix B),
whether such information is in paper, electronic or other form.  These measures
should, at a minimum include:

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(i)                                     Burning, pulverizing or shredding of
papers containing Consumer Information and Customer Information so that the
information cannot practicably be read or reconstructed;

(ii)                                  Ensuring the destruction or erasure of
electronic media containing Consumer Information and Customer Information so
that the information cannot practicably be read or reconstructed; and/or

(iii)                               Ensuring that any third party who performs
the activities described in (a) and (b) on behalf of Servicer above does so in a
manner consistent with this Section.

Servicer shall ensure that it does not retain Customer Information or Consumer
Information for longer than it needs such information to perform its obligations
hereunder.  Servicer’s disposal policy shall require that such information is
reviewed and destroyed on a routine basis consistent with the Servicer’s
disposal policy.

Servicer shall have in place and follow a routine destruction policy for all FMC
Confidential Information, FMC data, deliverables and any working papers,
correspondence, notes, memoranda, drafts or other material (whether in
electronic, paper or other form) related to Servicer’s performance under this
Agreement.  No such materials will be retained longer than such period as is set
forth in Servicer’s policy period for retention unless mandated under this
Agreement or by applicable law.

This Section is intended only to describe how to properly dispose of Consumer
Information and Customer Information.  Requirements related to when Customer
Information and Consumer Information must be retained or destroyed are found
elsewhere in this Agreement or under applicable law.

11.04                 Security Breach.  In the event Servicer knows or
reasonably believes that there has been any unauthorized acquisition of or
access to data that compromises the security, confidentiality, or integrity of
“non-public personal information” maintained by or for Servicer (a “Breach”),
Servicer shall take the following actions:

(i)                                     Immediately notify FMC of such Breach.

(ii)                                  Identify to FMC at no cost to FMC what
specific data, by customer and/or account number has or may have been Breached.

(iii)                               Monitor any affected accounts for any
unusual activity (if appropriate).

(iv)                              Take measures to contain and control the
incident to prevent further unauthorized access.

(v)                                 Remedy the circumstances that permitted such
Breach to occur.

(vi)                              Cooperate with FMC as necessary to facilitate
FMC’s compliance with any applicable federal or state law regarding unauthorized
access of customer personal information.

For the purposes of this section, “non-public personal information” shall
include any two of the following:  a person’s name, address, social security
number, telephone number, driver’s license or state ID number, account number,
credit/debit card account number, access code, password, identification number,
or security code.  Servicer shall fully reimburse FMC for the

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actual costs of mailing notices to individuals whose data has or may have been
Breached, where such Breach is the direct result, in whole or in part, of
Servicer’s breach of this Agreement, Servicer’s failure to conform to applicable
law, or Servicer’s negligence.

11.05                 Business Continuity and Site Disaster Recovery Plans 
Servicer shall maintain and shall test at least once annually plans to continue
business in the event of an interruption to its business or unavailability of
any site from which Services are being performed (the “Disaster Recovery and
Business Continuity Plans”).  The Servicer agrees that its Disaster Recovery and
Business Continuity Plan shall include, among other things, provision for the
remote storage of computer software and data, for the remote storage of copies
of Student Loan documentation in conformance with Section 4.04 (Custody), the
availability of a location for off-site computer services and procedures
covering all of the Servicer’s facilities used in connection with the Services
in order to insure continuance of Services in the event of a disaster affecting
any such Servicer facility and storage of a complete system image tape of both
object code and source code for its student loan servicing software at an
off-site storage location designated by the Servicer and disclosed to FMC.

The Servicer covenants and agrees that it shall create on a daily basis
electronically stored backup data for all Student Loan data for the particular
day.  At a minimum, the Servicer’s core processing facilities and operations
will include redundant backup and security to ensure minimal exposure to systems
failure or unauthorized access.  The Servicer will take commercially available
measures to ensure the continuity of operations via tape or other off-site
backup mechanism.  Power backup will be maintained throughout the core
processing facilities which affect performance of the Services should a power
outage occur.  The Business Continuity Plan must meet the Recovery Time
Objective (RTO) and Recovery Point Objective (RPO) as defined below:

The Service will be available within a three (3) day period following any
significant outage/incident (RTO = 72 hours) with a maximum of forty-eight (48)
hours of data loss (RPO = 48 hours).

Servicer shall test both its Disaster Recovery Plan and Business Continuity Plan
on an annual basis and send its annual Overview of Business Recovery Exercise
report to FMC.  Servicer agrees that upon reasonable notice and at Servicer’s
convenience, FMC may come to Servicer’s place of business and review the
specifics of Servicer’s Disaster Recovery and Business Continuity Plans with
Servicer. If any testing hereunder establishes that Servicer’s performance of
the Services is not in compliance with the terms of this Agreement, Servicer
shall within thirty (30) days of its receipt of the results of such testing,
publish a Remedial Action Plan and provide the same to FMC. Such Remedial Action
Plan shall include a schedule of Milestones and shall provide for reports to FMC
with respect to each Milestone. An event shall not be considered a force majeure
event to the extent that proper implementation of the Disaster Recovery and
Business Continuity Plans would have enabled Servicer to continue performance
hereunder in a timely manner.  The occurrence of a force majeure event or
disaster shall not excuse Servicer from having in place reasonable safeguarding
plans and procedures adequate for protecting all FMC Confidential or Proprietary
Information and Customer Information and Consumer Information. In the event of a
natural or other disaster beyond the Servicer’s control that

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interrupts the Servicer’s performance of any such Services for any period, the
Servicer shall promptly respond to such disaster in accordance with the
procedures contained in the Disaster Recovery and Business Continuity Plans in
order to resume performance of such Services.

11.06                 Servicer Firewall(s).

(i)                                     Servicer will create its firewall rules
based on the principle of least access needed.  This means that the firewall(s)
will only pass the traffic necessary for the system applications utilized by
Servicer in providing Services hereunder to function to the backend servers, and
any unnecessary traffic will be blocked.

(ii)                                  Servicer will segregate the Internet
environment used to provide service to its clients from the intranet environment
used by internal Servicer personnel.

(iii)                               An encrypted session will be used for
connectivity between FMC and Servicer over the internet.

11.07                 User Authentication Processes.  Servicer will follow its
existing policies, procedures, and standards for authentication.  Servicer will
provide FMC with access to such policies and procedures at Servicer’s place of
business.

11.08                 Intrusion Detection.  Servicer will maintain a current
industry standard intrusion detection monitoring system that protects its
infrastructure against system risk from outside users and vendors.  Servicer
will actively monitor the intrusion monitoring system and develop escalation
procedures to notify FMC personnel in the event of a security breach pursuant to
Section 11.04.

11.09                 Risk Assessment.  Servicer shall comply with industry best
practices and standards regarding information security.  In addition to
Servicer’s annual Type II SAS 70 audit, it shall partner with an external vendor
for the purpose of receiving a certification on Servicer’s information security
practices and protocols. The external vendor shall at a minimum conduct external
and internal scans and audits of the Servicer’s network. On an on-going basis
the external vendor shall provide to Servicer notification of any malicious
code, viruses or known threats so that Servicer may protect its network
accordingly.  Additionally, on an annual basis, Servicer shall engage external
vendors to conduct blind intrusion testing to verify Servicer’s then current
information security, controls, standards, and procedures.  Upon request from
the FMC, Servicer shall provide a certification letter from its external vendors
certifying Servicer’s compliance with industry best practices and standards. 
For each external vendor providing services described in this Section 11.09,
Servicer shall provide FMC with a summary of such vendor’s reports and shall
respond to any of FMC’s reasonable follow-up questions with respect to such
summaries.  Any information provided to FMC under this Section shall be deemed
Proprietary Information.

11.10.              Survival. The obligations set forth in this Section 11 as
they pertain to Proprietary Information, Confidential Information, Customer and
Consumer Information shall survive

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termination of this Agreement and continue for so long as the relevant
information remains Proprietary Information, Confidential Information, Customer
Information or Consumer Information.

SECTION 12.  DISPUTES

In the event of any dispute or disagreement between the parties hereto either
with respect to the interpretation of any provision of this Agreement or with
respect to the performance hereunder by the Servicer or by FMC, each of the
parties will appoint, no later than thirty (30) days after the dispute or
disagreement has arisen as evidenced in writing by one of the parties, a
designated officer to meet for the purpose of endeavoring to resolve such
dispute or to negotiate for an adjustment to such provision.  In case no
agreement is reached, a third designated person may be appointed upon mutual
agreement to resolve such dispute or to negotiate with the previously designated
officers to negotiate for an adjustment to such provision.  No formal
proceedings for the judicial resolution of the initially designated dispute may
be commenced until either of the designated officers concludes in good faith
that amicable resolution through continued negotiations of the matter in issue
does not appear likely.  In no event shall such dispute resolution procedure
continue for more than sixty (60) days after the appointment of the initially
designated officers, after which period of time either party may choose to seek
a final determination of liability on the part of the other party by a court of
law as set forth in Section 9 (Liability) herein.

SECTION 13. ASSIGNMENT.

13.01                 Assignment by the Servicer.  This Agreement and all the
rights and obligations of the Servicer hereunder may not without the prior
written consent of FMC, which consent shall not be unreasonably withheld, be
assigned or subcontracted by the Servicer. Any successor must acquire
substantially all of the assets or business of the Servicer, have the ability to
perform the Services under the terms and conditions hereof, and be approved by
the Insurer and reasonably acceptable to any Trustee.

13.02                 Assignment to Permitted Assignee.  The parties contemplate
that:

(a)                                pools of Committed Student Loans will be sold
by the Program Lender to SPEs in Securitization Transactions sponsored by FMC
from time to time, and Permitted Assignees will receive a collateral assignment
of the Committed Student Loans in each Securitization Transaction; and

(b)                               at the same time and as part of the same
transaction, FMC will assign its rights under this Agreement to obtain Servicing
of said Student Loans to said SPEs, which rights may be further assigned to
Permitted Assignees, so that said Student Loans will be Serviced by Servicer
under the terms of this Agreement, following execution by the parties of a
Servicer Consent Letter.

13.03                 Effect of Assignment.  Servicer agrees that upon the
assignment of FMC’s rights under this Agreement with respect to a pool of
Student Loans to a Permitted Assignee and the

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execution by the parties of a Servicer Consent Letter, all obligations of FMC
under this Agreement with respect to ongoing Servicing of such Student Loans,
including without limitation the obligation to pay fees set forth in the Fee
Schedule, shall cease, all rights and obligations of FMC under this Agreement
with respect to such Student Loans shall inure to the SPE and the Permitted
Assignees, and any all references to FMC in this Agreement, to the extent it has
been so partially assigned, shall be deemed to refer to said SPE.
Notwithstanding the foregoing, FMC shall retain rights under this Agreement that
do not relate to ongoing Servicing of such Student Loans, as set forth in
Section 2.03 (Role of FMC).

13.04                 Notice Requirement prior to Sale of Student Loans.  FMC
shall use reasonable efforts to notify the Servicer, in writing, sixty (60) days
prior to any sale of Student Loans, and shall notify Servicer, in writing, no
less than forty-five (45) days prior to any sale of Student Loan, currently
housed on the Servicing system as to (a) the anticipated sale date and (b) the
characteristics of the exact Student Loans to be sold. The actual sale date will
be provided five (5) days prior to the sale. Upon receipt of the above initial
notice, the Servicer will provide FMC with available transfer dates within
thirty (30) days.  Actual transfer dates shall be mutually agreed upon.

13.05                 Servicing Obligations after Sale of Student Loans (to
third party other than an SPE).

(a)                                  The Servicer’s Offer of Continued
Servicing.  With respect to any Student Loans which are sold, assigned or
transferred by a Permitted Assignee (other than a trustee under Section 13.02),
upon the Servicer’s receipt of a notice from such Permitted Assignee that it
intends to sell, assign or transfer any or all of the Student Loans which are
being Serviced hereunder, the Servicer shall contact the intended purchaser,
assignee or transferee (collectively, the “Transferee”) and offer to Service
such Student Loans for the Transferee for the balance of the term of this
Agreement (and, at the option of the Transferee, any extensions thereof) as
follows: (i) if the Transferee or an affiliate, parent, subsidiary or other
entity related to the Transferee (collectively, a “Related Entity”) has entered
into a servicing agreement with the Servicer, under the terms and conditions of
any such agreement, or (ii) otherwise, under terms and conditions which are no
less favorable than those terms and conditions which are contained in this
Agreement.  This subsection shall not apply to an assignment to a Permitted
Assignee pursuant to Section 13.02.

(b)                                 Liability of Permitted Assignee upon
Transferee’s Acceptance of Servicer’s Offer to Service Student Loans.  If the
Transferee accepts the offer described in 13.05(a)(i) or (ii), the Permitted
Assignee shall have no further obligation or liability to the Servicer hereunder
with respect to such Student Loans, and the Early Termination Fees set forth in
the Fee Schedule shall not be due and payable.  If the Transferee does not elect
to have the Servicer continue Servicing the Student Loans, the Permitted
Assignee shall pay the Early Termination Fees set forth in the Fee Schedule. 
This subsection shall not apply to an assignment to a Permitted Assignee
pursuant to subsection 13.02.

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Section 14.                                   TERMINATION

14.01                 Borrower’s Student Loan.   This Agreement shall terminate
as to a specific Borrower’s Student Loan on the earliest of:

(a)                                the month following the month during which
(i) the principal, interest, and Late Fees, if any, have been fully paid and
remitted to the Owner, and (ii) the Borrower has been notified that the Student
Loan has been paid in full;

(b)                               the end of the month during which notification
is given to the Servicer that a claim for guarantee/insurance relating to the
Student Loan has been paid by the Insurer; or

(c)                                the end of the month following the month
during which the sale or transfer of such Student Loan occurs where Servicer
does not continue Servicing such Student Loan subject to the provisions set
forth in Section 13 (Assignment) hereof.

14.02.              Termination by FMC.  This Agreement may be terminated at the
option of FMC upon the occurrence of any of the following:

(a)                                  Any of the representations or warranties
made in or pursuant to this Agreement are not true or are erroneous in any
material respect;

(b)                                 The Servicer’s failure to perform or observe
any of the provisions or covenants of this Agreement and its referenced
schedules and exhibits, in any material respect (including, without limitation,
any breach of the provisions of Section 4.13 (Collections), all of which shall
be deemed material);

(c)                                  If the Servicer shall (i) discontinue
business, or (ii) generally not pay its debts as such debts become due, or (iii)
make a general assignment for the benefit of creditors, or (iv) admit by answer,
default or otherwise the material allegations of petitions filed against it in
any bankruptcy, reorganization, insolvency or other proceedings (whether federal
or state), relating to relief of debtors, or (v) suffer or permit to continue
unstayed and in effect for thirty (30) consecutive days, any judgment, decree or
order, entered by a court of competent jurisdiction, which approves a petition
seeking its reorganization or appoints a receiver, custodian, trustee, interim
trustee or liquidator for itself or all or a substantial part of its assets, or
(vi) take or omit any action in order thereby to effect any of the foregoing;

(d)                                 Change of Control.  Notwithstanding 13.01
(Assignment by Servicer), if Servicer is the subject of a Change of Control, FMC
shall have the right to terminate this Agreement upon a minimum of twenty (20)
business days prior written notice. Such right of termination may be exercised
any time beginning upon the earlier of consummation of the Change of Control
transaction or public announcement that such a transaction is pending. Following
Servicer’s receipt of notice and information to support the termination
hereunder from FMC, Servicer shall work diligently with FMC to carry out the
deconversion of the Student Loans off of the

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Servicer’s Servicing system within a timeframe reasonably agreeable to the
parties but in any event shall be begun within ninety (90) business days from
the Servicer’s receipt of notice and the parties shall use their best efforts to
complete the deconversion process within 24 months from the date it begins. 
There will be no charge to FMC of Early Termination Fees as detailed in the Fee
Schedule attached hereto arising from FMC’s termination of the Agreement
pursuant to this Section. FMC shall be responsible for any and all fees arising
under this Agreement and the attached Fee Schedule that are incurred by FMC
hereunder prior to FMC’s termination of this Agreement pursuant to this Section.

(e)                                  Termination for Insufficient Volume.  In
the event that the total original principal amount of Student Loans being
Serviced pursuant to this Agreement shall be less than [**]dollars ($[**]) as of
the May 1 that occurs at least twenty-four months after the first Student Loan
is Serviced hereunder, then FMC and all Owners acting in concert may, by written
notice to Servicer, terminate this Agreement.  Such termination shall be on six
(6) months written notice .  Servicer shall cooperate fully in the deconversion
and transfer of such Student Loans to another Servicer.

In the event of an event of default as set forth in Section 14.02(a) or (b)
above, the Servicer shall have the right to cure any such breach or error to
FMC’s full satisfaction within thirty (30) days of written notice from FMC.
Notwithstanding the foregoing, Servicer shall have the right to cure any breach
of Section 4.13 (Collections) or any failure to conform to a Milestone in a
Remedial Action Plan within five (5) (not thirty (30)) days after written notice
from FMC.

In the event that: (i)  Servicer fails to cure such default and the Agreement is
terminated pursuant to Section 14.02 (a) or (b) or (ii) this Agreement is
terminated pursuant to Section 14.01 or 14.02 (c), or Sections 4.02, 4.03(d),
6.06, 10.01, there will be no charge to FMC for Early Termination Fees or Record
Return/Deconversion Fees.  In the event the Agreement is terminated prior to the
end of the initial term for any reason other than stated above (including
termination under Section 14.02(d), FMC shall be responsible for the payment of
Early Termination Fees and Record Return/Deconversion Fees as detailed in the
Fee Schedule.

14.03.       Termination by the Servicer. This Agreement may be terminated at
the option of the Servicer upon the occurrence of any of the following:

(a)                                  FMC’s failure to perform or observe any of
the material provisions or covenants of this Agreement; or

(b)                                 If FMC shall (a) discontinue business, or
(b) generally not pay its debts as such debts become due, or (c) make a general
assignment for the benefit of creditors, or (d) admit by answer, default or
otherwise the material allegations of petitions filed against it in any
bankruptcy, reorganization, insolvency or other proceeding (whether federal or
state) relating to relief of debtors, or (e) suffer or permit to

35

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continue unstayed and in effect for thirty (30) consecutive days, any judgment,
decree or order, entered by a court of competent jurisdiction, which approves a
petition seeking its reorganization or appoints a receiver, custodian, trustee,
interim trustee or liquidator for itself or all or a substantial part of its
assets, or (f) take or omit any action in order thereby to effect any of the
foregoing; or

In the event of an event of default as set forth in Section 14.03(a) or (b)
above, FMC shall have the right to cure any such breach or error to Servicer’s
full satisfaction within thirty (30) days of written notice from Servicer.

In the event FMC fails to cure such default and the Agreement is terminated
pursuant to Section 14.03(a) or (b), FMC shall pay Servicer the Early
Termination Fees and Record Return/Deconversion Fees set forth in the Fee
Schedule.

14.04.              Record Return/Deconversion.  Upon termination of this
Agreement or upon termination of this Agreement with respect to any particular
Student Loan or Loans whether by virtue of the passage of time or otherwise, the
Servicer shall, regardless of any FMC default or any other reason, return to FMC
all records, data processing records, reports, documents and correspondence,
including Original Credit Agreements, applications, payment histories, due
diligence histories, and copies of microfilm documents maintained by the
Servicer in connection with the Servicing of the Student Loans (or such Student
Loans as applicable). Servicer shall maintain a copy of all records and reports
which related to the Servicing of Student Loans generally for five years after
any deconversion.  Upon the return of the Student Loan records, FMC agrees to
pay the Record Return/Deconversion Fee, as set forth in the Fee Schedule, except
under the circumstances specifically set forth in this Agreement, and such
records will be returned to FMC by Servicer as provided below or as otherwise
mutually agreed upon by the parties.  Upon any termination or expiration of this
Agreement, any deconversion and transfer of the Accounts to FMC or its new
servicer shall be on an orderly schedule reasonably determined by the Servicer,
with FMC’s approval.  To the extent that the Servicer continues to provide
Servicing for any Accounts after the termination or expiration date pending such
scheduled deconversion and transfer, the terms of this Agreement shall remain in
effect and the Servicer’s fees shall continue to be paid hereunder with respect
to such Accounts during such period.

14.05                 Transition Period Rights.  If this Agreement is terminated
pursuant to Sections 14.02(a), (b), (c) or (d) or 4.02, 4.03(d), 6.06, or 10.01,
then FMC or any Owner shall have the right to demand continued Servicing of the
Student Loans by Servicer at the rates set forth in the Fee Schedule until such
time as all loans have been successfully deconverted.  FMC shall have the right
to access the Servicer’s facilities and access to Student Loan data in the same
manner as was permitted during the term of this Agreement.  Servicer has the
obligation upon termination or expiration to provide, and FMC or any Owner has
the absolute right to obtain, all of its Proprietary Information and Customer
Information at any time.

SECTION 15.  MISCELLANEOUS PROVISIONS

15.01                   Notices.  All notices, approvals, consents, requests or
other written communications regarding this Agreement are to be addressed as
noted below.

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If to FMC:

President

 

 

The First Marblehead Corporation

 

 

The Prudential Tower

 

 

800 Boylston Street, 34th Floor

 

 

Boston, Mass. 02199-8157

 

 

 

 

 

 

 

If to Servicer:

Executive Vice President, Marketing & Client Affairs

 

 

Pennsylvania Higher Education Assistance Agency

 

 

1200 North Seventh Street

 

 

Harrisburg, Pennsylvania 17102

 

15.02                 Relationship.  The parties to this Agreement intend that
the Servicer shall render the Services contemplated by this Agreement as an
independent contractor.  The Servicer and its employees, agents, and servants
are not to be considered agents or employees of FMC, for any purpose whatsoever.
Nothing herein contained, nor any action taken by the Servicer under this
Agreement, shall be deemed or construed to give the Servicer any right, title or
interest either in law or in equity in and to any Student Loan being Serviced by
Servicer.

15.03                 Non-Exclusive Agreement for FMC.  Nothing contained herein
shall be construed to create an exclusive arrangement as to FMC. The Servicer
understands and agrees that FMC may enter into other agreements for the
servicing of Private Student Loans in the future.

15.04                 Survival.  The representations and warranties of each
party shall survive the termination of this Agreement and the obligations and
duties of each party (including, without limitation, the obligations under
Sections 9 (Liability) and 14 (Confidentiality)) shall survive the termination
or expiration of this Agreement.

15.05                 Entire Understanding.  This Agreement herewith including
all Schedules and Exhibits attached thereto, represent the entire understanding
of the parties with respect to their subject matter, and supersede all previous
discussions and correspondence with respect thereto, and no representations,
warranties or agreements, express or implied, of any kind with respect to such
subject matter have been made by either party to the other, except as expressly
set forth herein or in such other agreements.

15.06                 Interpretation of Documents.  In the event of a conflict
between this Amended and Restated Private Student Loan Servicing Agreement and a
Schedule or Exhibit attached hereto, this Agreement shall control.

15.07                 Cooperation.   FMC and the Servicer agree that they will
cooperate fully with one

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another in order to carry out the terms and provisions of the Agreement during
the term of this Agreement and during all periods in which Committed Student
Loans and Student Loans are processed and Serviced by Servicer.  Cooperation
under this Section shall include, but not be limited to, each party using
reasonable means to ensure successful, normal, daily processing of Committed
Student Loans and Student Loans and related operations and functions.  Each
party agrees to support the reasonable routine efforts of the other party and to
work to resolve any disputes which may arise during such periods referenced
above, and to continue to work together in a professional, business-like manner
during all phases, functions and processes defined in this Agreement.

15.08                 Authorization.  Each of the undersigned represent that he
or she has the authority to execute this Agreement on behalf of the respective
party.

15.09                 Amendments; Changes; Modifications.  This Agreement,
Exhibits or Schedules (a) may be amended, supplemented, or modified only by
written instrument duly executed by FMC and the Servicer; (b) shall be
incorporated into this Agreement; and (c) shall be binding upon and shall inure
to the benefit of the parties hereto and their respective successors and
assigns.

15.10                 No Waiver.  Any failure by FMC or the Servicer to insist
upon the strict performance by the other of any of the terms and provisions of
this Agreement shall not be deemed to be a continuing waiver of any such terms
and provisions, and notwithstanding any such failure, such party shall have the
right thereafter to insist upon the resumption of strict performance by the
other of any and all of the terms and provisions hereof.  The rights and
remedies herein provided are cumulative and not exclusive of any rights or
remedies provided by law.

15.11                 Opinion of Outside Counsel.  Upon request by FMC, in
connection with a Securitization Transaction, the Servicer agrees to provide to
FMC an opinion of its outside counsel, in form and substance satisfactory to
counsel for FMC, that :

(a)                                  The agreement has been duly authorized by
all necessary action of the Servicer.

(b)                                 The agreement does not violate the chartered
documents or other constituent documents governing the Servicer or any other
applicable law.

(c)                                  The agreement has been duly executed by an
authorized officer of the Servicer.

(d)                                 The agreement is a valid and binding
obligation of the Servicer, enforceable in accordance with its terms.

Servicer may provide the opinion of its in-house corporate counsel, in lieu of
outside counsel, unless FMC agrees to pay the reasonable fees of Servicer’s
outside counsel in connection with such opinion.

15.12                 Law Governing.  This Agreement is being delivered in and
shall be construed in accordance with the laws of the Commonwealth of
Pennsylvania, without regard to any principles of conflict of laws.

15.13                 Waiver of Jury Trial.  THE PARTIES HEREBY EXPRESSLY WAIVE
ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
ARISING UNDER THIS AGREEMENT OR ANY OTHER DOCUMENT OR AGREEMENT EXECUTED OR
DELIVERED IN CONNECTION HEREWITH, OR IN

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ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO WITH RESPECT TO THIS AGREEMENT OR ANY SUCH DOCUMENT OR AGREEMENT, OR THE
SERVICES AND TRANSACTION RELATED HERETO OR THERETO, WHETHER NOW EXISTING OR
HEREAFTER ARISING, AND WHETHER IN CONTRACT, TORT OR OTHERWISE.

15.14                 Counterparts.  This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original and all
of which together shall be deemed to be one of and the same document.

15.15                 Unenforceability.  If any provision of this Agreement
shall be held to be invalid or unenforceable, such invalidity or
unenforceability shall not affect or impair the validity or enforceability of
the remaining provisions of this Agreement, which shall remain in full force and
effect, and the Parties hereto shall continue to be bound thereby.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the month, day and the year first-above written.

PENNSYLVANIA HIGHER EDUCATION

 

 

 

THE FIRST MARBLEHEAD

ASSISTANCE AGENCY

 

 

 

CORPORATION

 

 

 

 

 

 

 

 

 

 

/s/ Richard E. Willey

 

 

 

/s/ Anne Bowen

Name: Richard E. Willey

 

 

 

Name: Anne Bowen

 

 

 

 

 

 

 

 

 

 

Title:   President and CEO

 

 

 

Title:  Executive Vice President and

 

 

 

 

Chief Administrative Officer

 

 

 

 

 

 

 

 

 

 

Date: September 28, 2006

 

 

 

Date: September 28, 2006

 

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INDEX TO SCHEDULES AND EXHIBITS

Fee Schedule

System Access Schedule

Customer Service Schedule

Required Reports Schedule

Schedule A — Existing Program Guidelines**

Exhibit A — Servicer Consent Letter

Exhibit B — TERI Servicing Guidelines**

Exhibit C — Service Level Agreement

** Confidential treatment has been requested for
this exhibit or schedule in its entirety.

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FEE SCHEDULE FOR

AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT

DATED SEPTEMBER 28, 2006

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION (“AGREEMENT”)

This Fee Schedule shall be effective from the Effective Date for a period of
three years (the “Initial Term”) and shall then be open for negotiation. If no
changes are proposed or agreed to in writing, this Fee Schedule shall
automatically renew for an additional one (1) year periods.

I.                                         DEFINITIONS:

Capitalized terms used in this Fee Schedule have the meanings assigned to them
in the Agreement. In addition to the words and terms elsewhere defined in this
Agreement, the following terms shall have the following meanings unless the
Agreement indicates a contrary meaning or intent:

A.                                   An “Account” is to refer to the Credit
Agreements collectively of an individual Borrower of a particular Student Loan
type in the same status.

B.                                     An “Interim Account” is to refer to
Credit Agreements collectively of an individual Borrower that constitute (1) an
In-School (Enrolled) Account, or (2) a Grace Account.

C.                                     A “Repayment Account” is to refer to the
Credit Agreements of an individual Borrower under the terms of which the
repayment period has commenced, but which is not an In-School (Enrolled)
Account.

D.                                    An “In-School (Enrolled) Account” is to
refer to the Credit Agreements collectively of an individual Borrower with
respect to which principal and interest payments are deferred because the
Borrower is enrolled at an eligible institution, whether before of after the
repayment period begins.

E.                                      A “Grace Account” is to refer to the
Credit Agreements collectively of an individual Borrower (1) with respect to
which the Borrower has ceased to be enrolled at an eligible institution, and (2)
under the terms of which the repayment period has not yet commenced.

F.                                      “Standard Conversion” means the
conversion of a Borrower’s Account from data provided in hard-copy format or by
electronic means.

G.                                     “On-System Conversion” means the
conversion of a Borrower’s account that the Servicer is currently Servicing for
an owner or holder other than the proposed new owner or holder.

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II.                                     SERVICING FEES:

1.                                       Monthly Servicing Fees—Interim Account
Status:

The Servicing fee for Student Loans in Interim Account status shall be payable
by the Owner on a pro-rated monthly basis and shall be equal to [**] basis
points per annum based upon the ending principal balance of the Student Loans at
month end.

([**] x ending principal balance at month end divided by [**])

2.                                       Monthly Servicing Fees—Repayment
Account Status (other than Student Loans in Owner-caused Cure status):

(a) Ending Principal Balance < $[**] If the ending principal balance of the
Student Loans (including Student Loans in Interim Account status and Repayment
Account status) at month end is less than [**], then the Servicing fee for loans
in Repayment Account status shall be payable by the Owner on a pro-rated monthly
basis and shall be equal to [**] basis points per annum based upon the ending
principal balance of the Student Loans at each month end.

([**] x ending principal balance at month end divided by [**])

(b) Ending Principal Balance > or Equal to $[**] and < or Equal to $[**] If the
ending principal balance of the Student Loans (including Student Loans in
Interim Account status and Repayment Account status) at month end is [**] or
more, but less than or equal to [**], then the Servicing fee for loans in
Repayment Account status shall be payable by the Owner on a pro-rated monthly
basis and shall be equal to [**] basis points per annum based upon the ending
principal balance of the Student Loans at each month end.

([**] x ending principal balance at month end divided by [**])

(c) Ending Principal Balance > $[**]. If the ending principal balance of the
Student Loans (including Student Loans in Interim Account status and Repayment
Account status) at month end is greater than [**], then the Servicing fee for
loans in Repayment Account status shall be payable by the Owner on a pro-rated
monthly basis and shall be equal to (i) for the first $[**]of the ending
principal balance of the Student Loans, [**]basis points per annum based upon
the ending principal balance of the Student Loans at each month end; and (ii)
for the ending principal balance of the Student Loans in excess of $[**], [**]
basis points per annum based upon the ending principal balance of the Student
Loans at each month end.

For the first $[**]:

([**] x ending principal balance at month end divided by [**])

For amounts in excess of $[**]

([**] x ending principal balance at month end divided by [**])

(d) Delinquent Accounts. Notwithstanding subsections (a), (b), and (c) above,
the

43

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Servicing fee for loans in Repayment Account status shall be [**]basis points
for all Student Loans thirty (30) days or more delinquent until the Student Loan
is placed for pre-claims assistance, and for Student Loans placed for pre-claims
assistance, the Servicing fee for loans in Repayment Account status shall be
[**] basis points.

([**]x ending principal balance of Student Loans 30 or more days delinquent
divided by [**])

([**] x ending principal balance of Student Loans placed for pre-claims divided
by [**])

3.                                       High or Low Average Balance.
Notwithstanding the existence of the Initial Term, the Servicing fees in this
Section II may be renegotiated at any time the average principal balance of the
Student Loans is less than [**] or greater than [**]. If, at the conclusion of
any such negotiation, no changes are proposed or agreed to in writing, the Fee
Schedule shall remain in effect unchanged.

III.                                 CONVERSION FEES

1.                                       Interim Account—External

a.

 

Initial Exam:

 

$[**] per loan

 

b.

 

Serial Exam:

 

$[**] per loan

 

c.

 

Abbreviated Note Exam:

 

$[**] per loan

 

2.                                       Interim Account—On System

a.

 

Full Note Exam:

 

$[**] per loan

 

b.

 

Waived Exam:

 

No charge

 

 

 

 

 

 

3.

Repayment Account:

 

Quote

 

 

 

 

 

 

4.

Reconversion Fee:

 

$[**] per loan

 

 

 

 

 

 

5.

Rehabilitation Reconversion Fee

 

$[**] per loan

 

IV.                                DUE DILIGENCE/PRE-CLAIMS/CLAIMS PROCESSING

1.                                       Skip Trace

a.

 

Placement:

 

[**]

 

b.

 

Locate:

 

$[**] per loan

 

2.                                       Late
Fees:                                          [**]% of all collected late fee
revenue on delinquent accounts

3.                                       Third Party Referral (referral to third
party under contract with the Servicer for core/collection after successful
location):       $[**] per Borrower per bond issue

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4.                                       Claim Processing:

a.                                       The Owner shall pay a claim processing
fee of $[**] for each defaulted Student Loan per claim package filed. Claim
processing shall include, without limitation, presentation to Insurer of all
documentation required under the Servicing Guidelines, in the form required
thereunder.  Servicer will provide DDB Certification and Closed School
Certification at no charge.

V.                                    CURE SERVICING—Owner-Caused Cures

1.

Monthly fee

 

$[**] per account

2.

Skip Tracing—Locate

 

$[**] per account

3.

Third Party Referral

 

$[**] per account

4.

Guaranty Reinstated/

 

 

 

Default Claim Paid

 

$[**] per account

5.

Correction of Owner Error

 

$[**] per error

 

VI.                                MISCELLANEOUS FEES

1.

Deconversion to Owner

 

$[**] per loan

2.

Return of Records to Owner

 

$[**] per loan

 

 

 

 

 

 

3.

Early Termination

 

$[**] per Account

 

 

 

 

 

 

4.

Ad Hoc Projects/Reporting (fees to be pre-identified by the Servicer and billed
as identified)

 

 

 

 

 

 

 

a.

 

Computer Programmer

 

$[**]/hour

 

b.

 

Computer Analyst

 

$[**]/hour

 

c.

 

CPU Run Time

 

$[**]/hour

 

d.

 

Staff Services

 

$[**]/hour

 

e.

 

Legal Services

 

$[**]/hour

 

f.

 

GLB extract files

 

[**]for no charge
$[**] for each in excess of [**]

 

 

 

 

 

 

5.

Securitization (Financing, Bond Issue)

 

 

 

 

 

 

 

 

 

a.

 

Set-up Fee

 

$[**] per financing
(includes [**] hours of legal services per financing)

 

b.

 

Financing Legal Services

 

$[**]/hour (in excess of [**] hours per financing)

 

 

 

 

 

 

 

c.

 

Post Closing, Loan Transfer within

 

 

 

 

 

a financing

 

$[**] per Borrower per transfer

 

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6.

Mailings

 

 

 

 

 

 

 

 

 

a.

 

GLB privacy notices

 

$[**] per notice

 

b.

 

IRS Form 1098

 

$[**] per notice

 

c.

 

Other mailings or notices/

 

 

 

 

 

Special delivery notices

 

Quote

 

 

 

 

 

 

7.

Basic Monthly Reporting

 

[**]

 

 

 

 

8.

SAS 70 Audit

 

[**]

 

 

 

 

9.

Lender’s Audit Guide

 

[**]

 

 

 

 

10.

Borrower Incentive Programs

 

Quote

 

46

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have caused this Fee Schedule to be duly
executed as of the month, day and the year first-above written.

PENNSYLVANIA HIGHER EDUCATION
ASSISTANCE AGENCY

 

THE FIRST MARBLEHEAD
CORPORATION

 

 

 

 

 

 

 

 

 

 

By:

/s/ Richard E. Willey

 

By:

/s/ Anne Bowen

Name:

Richard E. Willey

 

Name: Anne Bowen

Title:

President and CEO

 

Title: Executive Vice President and Chief

 

 

 

Administrative Officer

Date: September 28, 2006

 

Date: September 28, 2006

 

47

--------------------------------------------------------------------------------

 

AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE-AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

SYSTEM ACCESS SCHEDULE

All system access for FMC, TERI, and FMER employees shall be limited to view
only option.

1. FMC.

Servicer shall provide FMC with web-based, view-only Account access, which shall
include the ability to view loan servicing screens including but not limited to
Borrower information,  Account history and due diligence records.

Individual FMC users shall obtain remote access within five (5) Business Days of
receipt of notice from FMC that such individual requires remote access.

2. BORROWERS.

Servicer shall provide Borrowers and Co-Borrowers with limited access to their
Account information.  Access should be limited to view-only, with the ability to
submit queries and request or print forms as necessary.

3. TERI.

Servicer shall provide TERI, and its agent FMER, with access to all TERI
guaranteed loans.  Access shall be limited to view-only and shall include the
ability to view all loan servicing screens including but not limited to borrower
information, Account History, due diligence records, and access requests.

4. FMC/FMER/TERI USER ACCESS SECURITY REQUIREMENTS

Servicer Relations at FMC will be responsible for notifying AES to add and
delete employees who need, or no longer need, access as appropriate.  On a
quarterly basis, AES will provide FMC with a report of FMC, FMER, and TERI
employees who have system access to Borrower information at AES.  FMC shall be
responsible for the accuracy of such reports and shall be liable for the
inaccuracy thereof in accordance with Section 9 (Liability) of this Agreement.

48

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AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE-AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

CUSTOMER SERVICE SCHEDULE

1. Call Monitoring.

Servicer shall monitor on a monthly basis a minimum of [**]% of the calls
received per customer service representative for quality.  Such monitoring shall
include the use of the Call Monitoring Scorecard as shown in Exhibit C (Service
Level Agreement).

FMC shall, upon reasonable notice to Servicer, have the ability to monitor calls
both on-site and remotely, at times and in a manner acceptable to both parties,
as established in an Operations Meeting (see Section 4.09).

2. Customer Service Hours of Operation

The Servicer shall maintain minimum customer service hours of operation from
7:30 a.m. to 9:00 p.m., Eastern Standard Time, Monday through Friday.  FMC
reserves the right to request an increase and/or decrease in these hours upon
written notice to Servicer, and Servicer agrees to accommodate such requests to
the extent feasible under the circumstances.

3. Collections Hours of Operation 

Servicer shall maintain minimum hours of operations for collection activities as
follows:

·                  Monday through Thursday, 8:00 a.m. to 9:00 p.m., Eastern
Standard Time

·                  Friday, 8:00 a.m. to 9:00 p.m., Eastern Standard Time

·                  Saturday, 8:00 a.m. to 1:00 p.m., Eastern Standard Time

4. Borrower Satisfaction Surveys 

The Servicer shall work with FMC to develop telephonic borrower satisfaction
surveys to measure the customer experience through various channels including
mail, internet, and Voice Response Unit.  If surveys demonstrate customer
service issues that require remedial action, Servicer shall collaborate with FMC
to resolve such issues.

5. Borrower Correspondence/Complaints

All correspondence received by Servicer relating to individual Borrower Accounts
shall be

49

--------------------------------------------------------------------------------

 

maintained by the Servicer and shall be made available to FMC during Servicer’s
normal business hours.  Servicer shall be responsible for handling all customer
service complaints.  Copies of escalated customer complaints from Borrowers and
Servicer’s response thereto are to be forwarded to FMC on a weekly basis. 
Complaints with respect to Student Loans and/or Borrowers received from any
regulatory body or federal or state agency shall be handled as exceptions and
Service shall contact FMC immediately.

50

--------------------------------------------------------------------------------

 

AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE-AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

REQUIRED REPORTS SCHEDULE

Servicer shall electronically deliver to FMC and/or all Owners, as applicable,
within the time periods specified below, the data elements that are, as of the
Effective Date, contained in the reports specified below:

1.                                       A report of all Committed Student Loans
on Servicer’s system that are fully disbursed, including (at least): Unique loan
identifier, Current principal balance, Current interest balance, and Fully
disbursed indicator, delivered to FMC ten (10) business days prior to a
scheduled Securitization Transaction,

2.                                       The same report as set forth in Item 1
above, updated through the closing date, delivered to FMC within five (5) days
after the closing date of a Securitization Transaction scheduled under Section
13.04 of the Agreement,

3.                                       MR-01 Report, delivered weekly to FMC
and all Owners.

4.                                       MR-50 Report, delivered to all Owners
within three (3) calendar days after the end of each calendar month.

5.                                       MR-53 Report, delivered to all Owners
within three (3) calendar days after the end of each calendar month

6.                                       Such other reports identified and
mutually adopted at Operations Meetings and made part of the Program Manual (see
Section 4.09 of this Agreement).

51

--------------------------------------------------------------------------------

 

SCHEDULE A

EXISTING LOAN PROGRAM GUIDELINES

AMENDED AND RESTATED PRIVATE STUDENT LOAN SERVICING AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE-AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

Program

 

Programs Covered

[**]

 

[**]

 

52

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Exhibit A – Servicer Consent Letter

SERVICER CONSENT LETTER

[DATE]

Pennsylvania Higher Education Assistance Agency

1200 North Seventh Street

Harrisburg, Pennsylvania 17102-1444

Attention:  Senior Vice President, Marketing & Client Affairs

Dear Sir or Madam:

Reference is hereby made to the Amended and Restated Private Student Loan
Servicing Agreement, dated September 28, 2006, as amended (the “Servicing
Agreement”), by and between the Pennsylvania Higher Education Assistance Agency
(the “Servicer”) and The First Marblehead Corporation (“FMC”), a copy of which
is attached hereto as Exhibit A. Capitalized terms not otherwise defined herein
shall have the meanings set forth in the Servicing Agreement. The parties hereto
agree as follows:

1.                                       FMC hereby assigns its interest in the
Servicing Agreement with respect to the Student Loans identified on the attached
Schedule 1 (the “Student Loans”) to The National Collegiate Student Loan Trust
[TRUST NAME] (the “Issuer”), and the Servicer hereby consents thereto.

2.                                       The Servicer hereby consents to the
assignment and to the grant by the Issuer of a security interest in the
Servicing Agreement to U.S. Bank National Association (the “Indenture Trustee”),
as provided in the Indenture (the “Indenture”), dated as of [INDENTURE DATE], by
and between the Issuer and the Indenture Trustee, for the benefit of the holders
of the Student Loan Asset Backed Notes (the “Notes”) of the Issuer.

3.                                       The Servicer hereby confirms that it
will not terminate the Servicing Agreement until the appointment of a successor
servicer by the Issuer, unless such termination is due to a default by the
Issuer under Section 14.03 thereof, or unless the Servicing Agreement otherwise
expires in accordance with Section 3 thereof.

4.                                       The Issuer hereby confirms that it will
not terminate the Servicer for cause pursuant to Section 14.02 of the Servicing
Agreement until a successor servicer is appointed.

5.                                       The Servicer hereby confirms that it
has complied with all the terms and satisfied all the conditions on its part to
be performed or satisfied under the Servicing Agreement.

53

--------------------------------------------------------------------------------

6.                                       It is expressly understood and agreed
by the parties hereto that (i) this servicer consent letter is executed and
delivered by [OWNER TRUSTEE] (the “Owner Trustee”), not individually or
personally, but solely as owner trustee of the Issuer under the Trust Agreement
dated as of [TRUST AGREEMENT DATE] among The National Collegiate Funding LLC,
The Education Resources Institute, Inc. and the Owner Trustee, in the exercise
of the powers and authority conferred and vested in it, (ii) each of the
representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as a personal representation, undertaking and
agreement by the Owner Trustee, but is made and intended for the purpose of
binding only the Issuer, (iii) nothing herein contained shall be construed as
creating any personal or individual liability on the Owner Trustee, to perform
any covenant either expressed or implied contained herein, all such liability,
if any, being expressly waived by the parties hereby and by any person claiming
by, through, or under the parties hereto, and (iv) under no circumstances shall
the Owner Trustee be personally liable for the payment of any indebtedness or
expenses of the Issuer or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Issuer under this
Agreement or any other documents related to the Notes.

7.                                       Any breach of the Servicer’s
obligations under this Servicer Consent Letter shall constitute a material
breach of the Servicing Agreement.

8.                                       The parties hereto acknowledge and
agree that for so long as any Notes are outstanding, the Indenture Trustee is a
third party beneficiary hereof and of the Servicing Agreement, and the Indenture
Trustee shall have the right to exercise all rights of the Issuer under the
Servicing Agreement.

9.                                       The Servicer will execute and deliver
to FMC (or its nominee) and the Owner Trustee annually on or before July 31 of
each year, and at such other times as FMC (or its nominee) and the Owner Trustee
(or either of them) are required to provide certification to the Securities and
Exchange Commission under the Securities Exchange Act of 1934 in connection with
servicing related activities: (i) a Report on Assessment of Compliance
Statement, as required by paragraph (a) of Item 1122 of Regulation AB of the
Securities and Exchange Commission (“Regulation AB”), in the form attached
hereto as Exhibit B; and (ii) a Servicer Compliance Statement, as required by
Item 1123 of Regulation AB, in the form attached hereto as Exhibit C. In
addition, annually on or before July 31 of each year, the Servicer will cause a
registered public accounting firm to execute and deliver a Registered Public
Accounting Firm Attestation Report, as required by paragraph (b) of Item 1122 of
Regulation AB. All costs associated with the performance of the obligations
under this paragraph 9 shall be by the Issuer.

[Signature Pages Follow]

54

--------------------------------------------------------------------------------

Please acknowledge your acceptance and agreement to the foregoing by signing
below.

 

Very truly yours,

 

 

 

 

 

THE FIRST MARBLEHEAD CORPORATION

 

 

 

 

 

By:

 

 

 

Name:

 

Title:

 

 

 

 

ACCEPTED AND AGREED:

 

 

 

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

THE NATIONAL COLLEGIATE STUDENT LOAN TRUST [TRUST NAME]

 

 

By:

[OWNER TRUSTEE],

 

 

not in its individual capacity but solely as Owner Trustee

 

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

Title:

 

 

55

--------------------------------------------------------------------------------

Exhibit A

56

--------------------------------------------------------------------------------

Exhibit B

FORM OF REPORT ON ASSESSMENT OF COMPLIANCE STATEMENT

[DATE]

[ACCOUNTANT’S ADDRESS]

The National Collegiate Student Loan Trust 20     -   

[ADDRESS]

In connection with the Annual Report on Form 10-K of The National Collegiate
Student Loan Trust 20   -   for the fiscal year ending June 30, 20    (the
“Report”) and as required by Item 1122 of Regulation AB of the Securities and
Exchange Commission (“Regulation AB”), the undersigned, a duly authorized
officer of the [SERVICER] (the “Servicer”), does hereby certify and represent as
follows:

1.                             A review of the activities of the Servicer for
the period that is the subject of the Report has been made under the supervision
of the undersigned;

2.                             The applicable criteria required in paragraph (d)
of Item 1122 of Regulation AB, as listed on Schedule A, attached hereto, (the
“Servicing Criteria”) were used to assess compliance of the Servicer;

3.                             To the best knowledge of the undersigned, based
on such review, the Servicer has substantially fulfilled all its material
obligations under the applicable Servicing Criteria;

4.                             To the best knowledge of the undersigned, based
on such review, the undersigned has identified no material instances of
noncompliance of the Servicer with the applicable Servicing Criteria; and

5.                             The registered public accounting firm of [FIRM]
has issued an attestation report on this Report on Assessment of Compliance for
the period that is the subject of the Report.

57

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the undersigned has executed this Report of the Servicer as
of                             , 20     .

 

[SERVICER], as Servicer

 

 

 

 

 

By:

 

 

 

Name:

 

Title

 

58

--------------------------------------------------------------------------------

Schedule A

Pursuant to Instruction 1 of Item 1122 of Regulation AB, the following list of
Servicing Criteria has been “Reviewed” or deemed “Not Applicable” by the
Servicer, as marked.

 

 

Reviewed

 

Not Applicable

 

 

General Servicing Considerations

 

 

 

 

1122(d)(1)(i)

 

Policies and procedures are instituted to monitor any performance or other
triggers and events of default in accordance with the transaction agreements.

 

 

 

X

1122(d)(1)(ii)

 

If any material servicing activities are outsourced to third parties, policies
and procedures are instituted to monitor the third party’s performance and
compliance with such servicing activities.

 

 

 

X

1122(d)(1)(iii)

 

Any requirements in the transaction agreements to maintain a back-up servicer
for the Pool Assets are maintained.

 

 

 

X

1122(d)(1)(iv)

 

A fidelity bond and errors and omissions policy is in effect on the party
participating in the servicing function throughout the reporting period in the
amount of coverage required by and otherwise in accordance with the terms of the
transaction agreements.

 

X

 

 

 

 

Cash Collection and Administration

 

 

 

 

1122(d)(2)(i)

 

Payments on pool assets are deposited into the appropriate custodial bank
accounts and related bank clearing accounts no more than two business days
following receipt, or such other number of days specified in the transaction
agreements.

 

X

 

 

1122(d)(2)(ii)

 

Disbursements made via wire transfer on behalf of an obligor or to an investor
are made only by authorized personnel.

 

 

 

X

1122(d)(2)(iii)

 

Advances of funds or guarantees regarding collections, cash flows or
distributions, and any interest or other fees charged for such advances, are
made, reviewed and approved as specified in the transaction agreements.

 

 

 

X

1122(d)(2)(iv)

 

The related accounts for the transaction, such as cash reserve accounts or
accounts established as a form of over collateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth in the
transaction agreements.

 

X

 

 

1122(d)(2)(v)

 

Each custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes of this
criterion, “federally insured depository institution” with respect to a foreign
financial institution means a foreign financial institution that meets the
requirements of Rule 13k-1(b)(1) of the Securities Exchange Act.

 

X

 

 

1122(d)(2)(vi)

 

Unissued checks are safeguarded so as to prevent unauthorized access.

 

X

 

 

1122(d)(2)(vii)

 

Reconciliations are prepared on a monthly basis for all asset-backed securities
related bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically accurate; (B) prepared
within 30 calendar days after the bank statement cutoff date, or such other
number of days specified in the transaction agreements; (C) reviewed and
approved by someone other than the person who prepared the reconciliation; and
(D) contain explanations for reconciling items. These reconciling items are
resolved within 90 calendar days of their original identification, or such other
number of days specified in the transaction agreements.

 

X

 

 

 

 

Investor Remittances and Reporting

 

 

 

 

1122(d)(3)(i)

 

Reports to investors, including those to be filed with the Commission, are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with the terms

 

 

 

 

59

--------------------------------------------------------------------------------

 

 

 

Reviewed

 

Not Applicable

 

 

specified in the transaction agreements; (C) are filed with the Commission as
required by its rules and regulations; and (D) agree with investors’ or the
trustee’s records as to the total unpaid principal balance and number of Pool
Assets serviced by the Servicer.

 

 

 

X

1122(d)(3)(ii)

 

Amounts due to investors are allocated and remitted in accordance with
timeframes, distribution priority and other terms set forth in the transaction
agreements.

 

 

 

X

1122(d)(3)(iii)

 

Disbursements made to an investor are posted within two business days to the
Servicer’s investor records, or such other number of days specified in the
transaction agreements.

 

 

 

X

1122(d)(3)(iv)

 

Amounts remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank statements.

 

 

 

X

 

 

Pool Asset Administration

 

 

 

 

1122(d)(4)(i)

 

Collateral or security on pool assets is maintained as required by the
transaction agreements or related pool asset documents.

 

 

 

X

1122(d)(4)(ii)

 

Pool assets and related documents are safeguarded as required by the transaction
agreements

 

X

 

 

1122(d)(4)(iii)

 

Any additions, removals or substitutions to the asset pool are made, reviewed
and approved in accordance with any conditions or requirements in the
transaction agreements.

 

 

 

X

1122(d)(4)(iv)

 

Payments on pool assets, including any payoffs, made in accordance with the
related pool asset documents are posted to the Servicer’s obligor records
maintained no more than two business days after receipt, or such other number of
days specified in the transaction agreements, and allocated to principal,
interest or other items (e.g., escrow) in accordance with the related pool asset
documents.

 

X

 

 

1122(d)(4)(v)

 

The Servicer’s records regarding the pool assets agree with the Servicer’s
records with respect to an obligor’s unpaid principal balance.

 

X

 

 

1122(d)(4)(vi)

 

Changes with respect to the terms or status of an obligor’s pool assets (e.g.,
loan modifications or re-agings) are made, reviewed and approved by authorized
personnel in accordance with the transaction agreements and related pool asset
documents.

 

X

 

 

1122(d)(4)(vii)

 

Loss mitigation or recovery actions (e.g., forbearance plans, modifications and
deeds in lieu of foreclosure, foreclosures and repossessions, as applicable) are
initiated, conducted and concluded in accordance with the timeframes or other
requirements established by the transaction agreements.

 

X

 

 

1122(d)(4)(viii)

 

Records documenting collection efforts are maintained during the period a pool
asset is delinquent in accordance with the transaction agreements. Such records
are maintained on at least a monthly basis, or such other period specified in
the transaction agreements, and describe the entity’s activities in monitoring
delinquent pool assets including, for example, phone calls, letters and payment
rescheduling plans in cases where delinquency is deemed temporary (e.g., illness
or unemployment).

 

X

 

 

1122(d)(4)(ix)

 

Adjustments to interest rates or rates of return for pool assets with variable
rates are computed based on the related pool asset documents.

 

X

 

 

1122(d)(4)(x)

 

Regarding any funds held in trust for an obligor (such as escrow accounts): (A)
such funds are analyzed, in accordance with the obligor’s pool asset documents,
on at least an annual basis, or such other period specified in the transaction
agreements; (B) interest on such funds is paid, or credited, to obligors in
accordance with applicable pool asset documents and state laws; and (C) such
funds are returned to the obligor within 30 calendar days of full repayment of
the related pool assets, or such other number of days

 

 

 

X

 

60

--------------------------------------------------------------------------------

 

 

 

Reviewed

 

Not Applicable

 

 

specified in the transaction agreements.

 

 

 

 

1122(d)(4)(xi)

 

Payments made on behalf of an obligor (such as tax or insurance payments) are
made on or before the related penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided that such support has
been received by the servicer at least 30 calendar days prior to these dates, or
such other number of days specified in the transaction agreements.

 

 

 

X

1122(d)(4)(xii)

 

Any late payment penalties in connection with any payment to be made on behalf
of an obligor are paid from the Servicer’s funds and not charged to the obligor,
unless the late payment was due to the obligor’s error or omission.

 

 

 

X

1122(d)(4)(xiii)

 

Disbursements made on behalf of an obligor are posted within two business days
to the obligor’s records maintained by the servicer, or such other number of
days specified in the transaction agreements.

 

 

 

X

1122(d)(4)(xiv)

 

Delinquencies, charge-offs and uncollectible accounts are recognized and
recorded in accordance with the transaction agreements.

 

X

 

 

1122(d)(4)(xv)

 

Any external enhancement or other support, identified in Item 1114(a)(1) through
(3) or Item 1115 of Regulation AB, is maintained as set forth in the transaction
agreements.

 

 

 

X

 

61

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Exhibit C

FORM OF SERVICER COMPLIANCE STATEMENT FOR

THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 20   -  

[DATE]

The National Collegiate Student Loan Trust 20   -  

[ADDRESS]

In connection with the Annual Report on Form 10-K of The National Collegiate
Student Loan Trust 20   -   for the fiscal year ending June 30, 20    (the
“Report”), the undersigned, a duly authorized officer of the [SERVICER] (the
“Servicer”), does hereby certify and represent as follows:

1.                             A review of the activities and performance of the
Servicer under the Servicing Agreement dated as of
[                                 ], as amended, between the Servicer and The
First Marblehead Corporation (the “Servicing Agreement”) for the period that is
the subject of the Report has been made under the supervision of the
undersigned;

2.                             To the best knowledge of the undersigned, based
on such review, the Servicer has fulfilled all of its obligations under the
Servicing Agreement in all material respects throughout the period that is the
subject of the Report; and

3.                             To the best knowledge of the undersigned, based
on such review, there have been no failures to fulfill any such obligation in
any material respect.

IN WITNESS WHEREOF, the undersigned has executed this Servicer Compliance
Statement as of [                                    ], 20   .

[SERVICER], as Servicer

 

 

 

 

 

By:

 

 

 

Name:

 

Title

 

62

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Exhibit B — Servicing Guidelines

SERVICING GUIDELINES FOR TERI LOAN PROGRAMS
SERVICED AT
PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY
(D/B/A AMERICAN EDUCATION SERVICES)

[**]

63

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EXHIBIT C

SERVICE LEVEL AGREEMENTS

FOR TERI LOAN PROGRAMS

SERVICED AT

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY

(d/b/a AMERICAN EDUCATION SERVICES)

Servicer agrees to adhere to the Service Level Agreement (SLA) outlined below.
Servicer’s failure to adhere to the standards in this SLA shall result in the
penalties set forth in Section 4.02 of the Agreement, under the terms and
conditions set forth in that Section.

The Servicer will provide First Marblehead Corporation (FMC) with monthly
reports setting forth Servicer’s performance relative to the below SLA for the
month covered by the report, the month prior to the month covered by the report,
and the Servicer’s year-to-date average performance level through the month
covered by the report. These reports will be made available to FMC no later than
fifteen (15) business days following the last day of the month covered by the
report.

I.                                       Customer Service Standards:

Telephone and Internet Chat Standards:

·                  Average Speed of Answer: [**]seconds or less.

·                  Abandonment Percentage: Average not greater than [**]%.

·                  Call Blockage: [**]% or less.

·                  Call Quality Assessment: Average rating not less than [**]% -
utilizing Servicer’s evaluation form as set forth and incorporated herein at
Exhibit 1.

·                  Borrower Satisfaction: Average rating in annual survey not
less than [**]%.

Correspondence Standards

·                  Mail sorted and distributed within: Servicer’s Service
Objective: [**]% within one business day not to exceed two business days on
average.

·                  General Borrower correspondence answered within [**] business
days of receipt on average – Servicer’s Service Objective: [**] days. During
peak processing months of January through March, August, and October,
correspondence answered within [**] business days of receipt on average. (This
standard shall not apply to any correspondence involving death, disability, or
bankruptcy Accounts.)

·                  Borrower Email Correspondence: Answered within an average of
[**] business days of receipt.

--------------------------------------------------------------------------------

·                  School Correspondence: Answered within [**] business days of
receipt on average — Servicer’s Service Objective: [**] days. During peak
processing months of January through March, July, and September school
correspondence answered within [**] business days of receipt on average.

·                  Clearinghouse Correspondence (Manual Processing Only):
Answered within [**] business days of receipt on average – Servicer’s Service
Objective: [**] days. During peak processing months of January through March,
June, and October through November Clearinghouse correspondence answered within
[**] business days of receipt on average.

·                  Deferment Processing: Processed within [**] business days of
receipt on average – Servicer’s Service Objective: [**] days. During peak
processing months of February and August through November deferments processed
within [**] business days of receipt on average.

·                  Forbearance Processing: Processed within [**] business days
of receipt on average – Servicer’s Service Objective: [**] days. During peak
processing months of January through March, August, November through December
forearances processed within [**] business days of receipt on average.

·                  Miscellaneous Account Reviews and adjustments completed
within [**] business days of receipt on average – there are exceptions to this
process.

II.                                     Payment Processing

·                  Non-Exception Loan Payments: Posted within an average of [**]
business day of receipt – [**]% of the time.

·                  Exception Loan Payments: Processed/resolved within an average
of [**] business days of receipt — [**]% of the time

III.                                       Fraud Prevention

Fraud notification to FMC within [**] business days of initial notification.

IV.                                       Default Prevention

·                  Collection contacts (left message or right party contact
only) as a % of all delinquent accounts attempted per bucket:

·                  31 - 60 day bucket at least [**]%

·                  61 - 90 day bucket at least [**]%

·                  Promise to pay rate not less than [**]% of all delinquent
accounts attempted greater than 30 days delinquent.

·                  Skip-trace locate rate not less than [**]% of all accounts
coded as requiring skip-trace activities.

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V.                                     System Requirements

·                  System Availability (scheduled CICS system up time): [**]% or
better. This standard shall not include the measurement for web based
applications, batch processes, or scheduled CICS down time including but not
limited to Sunday maintenance.

·                  Screen Navigation - Servicer shall provide an average
internal CICS response time of less than [**]. This measurement shall only be
applicable to Servicer’s provision of screen navigation and shall not be
impacted nor include measurement relative to users’ internet based access to the
screens because AES/PHEAA has no ability to control response times for users’
ISP connections or internal network performance. Servicer shall report the
internal average response time on a monthly basis for the CICSL0PA system
including the availability percentage for that system for normal scheduled hours
of usage.

VI.                                 Conversion

·                  Servicer shall convert all Committed Student Loan origination
data necessary for servicing hereunder onto its Servicing System within [**]
days of receipt of complete Student Loan files containing critical and
non-critical documentation from TERI or from FMER on TERI’s behalf.

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