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U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

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FORM10-QSB/A(Amendment No. 1)

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(Mark One)

x

QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the Quarter Ended March 31, 2003.

OR

o

TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the transition period from ______________ to ______________

Commission
file number: 000-29995

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EDUCATION LENDING GROUP, INC.

(Exact name of small business issuer as specified in its charter)

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| | Delaware(State or other jurisdiction of incorporationor organization) |  | 33-0851387(IRS employer identification number) | 
| | --------------------------------------------------------------------- |  | ---------------------------------------------- | 

12760 High Bluff Drive, Suite 210, San Diego, California 92130(Address of principal
executive offices)

(858) 617-6080(Registrants telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o

Indicate the number of shares outstanding of each of the issuers classes of common stock, as of the last practicable date: Shares of Common Stock, $0.001 par value, outstanding on March
31, 2003: 11,351,250, including treasury shares.

Transitional Small Business Format: Yes o No x

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##### Table of Contents

EXPLANATION OF AMENDMENT



As announced in a press release dated February 26, 2004, as the result of a $468,000 computational error, Education Lending Group, Inc. is
restating its consolidated results for the first, second and third quarters of 2003. Loan servicing set-up fees should have been written off against the "gain on sale" instead of continuing to be amortized when the related consolidated
loans were sold. We are filing this Form 10-QSB/A to report the results for the first quarter of 2003, as restated and as discussed in Note 3 to the Consolidated Financial Statements. Other than as set forth below, the restatement does not impact
any of the financial or other information set forth in the original filing of our Form 10-QSB for the period ended March 31, 2003. Effective as of December 31, 2003, Education Lending Group, Inc. is no longer a small business issuer. In the future,
we will report our quarterly results on Form 10-Q and our annual results on Form 10-K.



TABLE OF CONTENTS



|         |  |                       |   |                                                                                       | Page
|-------- |  | --------------------- | - | ------------------------------------------------------------------------------------- | ----
|         |  |                       |   |                                                                                       |     
|PART I.  |  | FINANCIAL INFORMATION | 3
|         |  |                       |   |                                                                                       |     
|         |  | Item 1.               |   | Financial Statements                                                                  | 3   
|         |  |                       |   |                                                                                       |     
|         |  |                       |   | Consolidated Balance Sheets                                                           | 3   
|         |  |                       |   |                                                                                       |     
|         |  |                       |   | Consolidated Statements of Operations                                                 | 4   
|         |  |                       |   |                                                                                       |     
|         |  |                       |   | Consolidated Statement of Stockholders (Deficit)                                     | 5   
|         |  |                       |   |                                                                                       |     
|         |  |                       |   | Consolidated Statements of Cash Flows                                                 | 6   
|         |  |                       |   |                                                                                       |     
|         |  |                       |   | Consolidated Notes to Financial Statements                                            | 7   
|         |  |                       |   |                                                                                       |     
|         |  |                       |   | Report of Independent Accountants                                                     | 8   
|         |  |                       |   |                                                                                       |     
|         |  | Item 2.               |   | Managements Discussion and Analysis of Financial Condition and Results of Operations | 9   
|         |  |                       |   |                                                                                       |     
|         |  | Item 3.               |   | Controls and Procedures                                                               | 10  
|         |  |                       |   |                                                                                       |     
|PART II. |  | OTHER INFORMATION     |  
|         |  |                       |   |                                                                                       |     
|         |  | Item 6.               |   | Exhibits and Reports on Form8-K                                                       | 10  

2



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PART I.FINANCIAL INFORMATION

Item 1.

Financial Statements

EDUCATION LENDING GROUP, INC.CONSOLIDATED BALANCE SHEETS



|                                                                                                                                     |  | March 31,2003 |               | December 31,2002 |  
|------------------------------------------------------------------------------------------------------------------------------------ |  | ------------- | ------------- | ---------------- | -
|                                                                                                                                     |  | (restated)    |               |                  |  
|                                                                                                                                     |  |               |               |                  |  
|                                                                                                                                     |  | (Unaudited)   |               |                  |  
|                                                                                                                                     |  |               |               |                  |  
|ASSETS                                                                                                                               |  |               |               |                  |  
|Student loans, net of loan loss reserve                                                                                              |  | $             | 840,801,450   |                  | $
|Student loans, net of loan loss reserve (securitized)                                                                                |  |               | 952,763,683   |                  |  
|Restricted cash and investments                                                                                                      |  |               | 83,881,811    |                  |  
|Cash and cash equivalents                                                                                                            |  |               | 5,647,439     |                  |  
|Interest & other receivables                                                                                                         |  |               | 13,671,735    |                  |  
|Property and equipment, net                                                                                                          |  |               | 1,394,166     |                  |  
|Deferred financing costs                                                                                                             |  |               | 4,824,796     |                  |  
|Other                                                                                                                                |  |               | 484,092       |                  |  
|                                                                                                                                     |  |               |               |                  |  
|Total Assets                                                                                                                         |  | $             | 1,903,469,172 |                  | $
|                                                                                                                                     |  |               |               |                  |  
|                                                                                                                                     |  |               |               |                  |  
|LIABILITIES AND STOCKHOLDERS (DEFICIT)                                                                                              |  |               |               |                  |  
|Accounts payable                                                                                                                     |  | $             | 4,079,521     |                  | $
|Government payable                                                                                                                   |  |               | 6,031,086     |                  |  
|Accrued expenses and other liabilities                                                                                               |  |               | 7,408,940     |                  |  
|Series 2002 notes                                                                                                                    |  |               | 1,013,000,000 |                  |  
|Warehouse loan facility                                                                                                              |  |               | 900,001,221   |                  |  
|                                                                                                                                     |  |               |               |                  |  
|Total Liabilities                                                                                                                    |  |               | 1,930,520,768 |                  |  
|                                                                                                                                     |  |               |               |                  |  
|Preferred stock - $0.001 par value, 10,000,000 shares authorized                                                                     |  |               |               |                  |  
|Common stock - $0.001 par value, 40,000,000 shares authorized, 11,351,250 and 11,189,084 shares issued and outstanding,
respectively |  |               | 11,351        |                  |  
|Additional paid in capital                                                                                                           |  |               | 8,393,332     |                  |  
|Accumulated deficit                                                                                                                  |  |               | (35,456,279   | )                |  
|                                                                                                                                     |  |               |               |                  |  
|Total Stockholders (Deficit)                                                                                                        |  |               | (27,051,596   | )                |  
|                                                                                                                                     |  |               |               |                  |  
|Total Liabilities and Stockholders (Deficit)                                                                                        |  | $             | 1,903,469,172 |                  | $
|                                                                                                                                     |  |               |               |                  |  

See accompanying notes

3



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EDUCATION LENDING GROUP, INC.CONSOLIDATED STATEMENTS OF OPERATIONSFor the Three Months Ended March 31, 2003 and 2002(Unaudited)

|                                                              |  | 2003       |            | 2002 |  
|------------------------------------------------------------- |  | ---------- | ---------- | ---- | -
|                                                              |  | (restated) |            |      |  
|                                                              |  |            |            |      |  
|Interest income:                                              |  |            |            |      |  
|Student loans, net                                            |  | $          | 14,712,652 |      | $
|Investments                                                   |  |            | 190,905    |      |  
|                                                              |  |            |            |      |  
|                                                              |  |            | 14,903,557 |      |  
|Cost of interest income                                       |  |            |            |      |  
|Interest related expenses                                     |  |            | 8,607,003  |      |  
|Valuation of interest rate swap                               |  |            | 912,702    |      |  
|Loan servicing and other fees                                 |  |            | 733,977    |      |  
|                                                              |  |            |            |      |  
|Total cost of interest income                                 |  |            | 10,253,682 |      |  
|Net interest income                                           |  |            | 4,649,875  |      |  
|                                                              |  |            |            |      |  
|Less: provision for loan losses                               |  |            | 548,262    |      |  
|                                                              |  |            |            |      |  
|Net interest income/(expense) after provision for loan losses |  |            | 4,101,613  |      |  
|                                                              |  |            |            |      |  
|Other income                                                  |  |            |            |      |  
|Gain on sale of student loans                                 |  |            | 7,741,418  |      |  
|Other                                                         |  |            | 7,045      |      |  
|                                                              |  |            |            |      |  
|Total other income                                            |  |            | 7,748,463  |      |  
|Operating expenses:                                           |  |            |            |      |  
|General and administrative                                    |  |            | 2,562,113  |      |  
|Sales & marketing                                             |  |            | 10,846,751 |      |  
|                                                              |  |            |            |      |  
|Total operating expenses                                      |  |            | 13,408,864 |      |  
|                                                              |  |            |            |      |  
|Loss before income tax provision                              |  |            | (1,558,788 | )    |  
|Income tax provision                                          |  |            | 36,056     |      |  
|                                                              |  |            |            |      |  
|Net loss                                                      |  | $          | (1,594,844 | )    | $
|                                                              |  |            |            |      |  
|Net loss per share:                                           |  |            |            |      |  
|Basic & Diluted                                               |  | $          | (0.14      | )    | $
|Weighted average common shares outstanding:                   |  |            |            |      |  
|Basic & Diluted                                               |  |            | 11,311,164 |      |  
|                                                              |  |            |            |      |  

See accompanying notes

4



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EDUCATION LENDING GROUP, INC.CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS (DEFICIT)For the Three Months Ended March 31, 2003(Unaudited)



|                                     |  | Common Stock    | 
|------------------------------------ |  | --------------- | 
|                                     |  |                 | 
|                                     |  | Number ofShares | 
|                                     |  |                 | 
|                                     |  |                 | 
|Balance, December 31, 2002           |  | 11,189,084      | 
|Issuance of common stock             |  | 162,166         | 
|Net loss, March 31, 2003 (restated)  |  |                 | 
|                                     |  |                 | 
|Balance at March 31, 2003 (restated) |  | 11,351,250      | 

See accompanying notes

5



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EDUCATION LENDING GROUP, INC.CONSOLIDATED STATEMENTS OF CASH FLOWSFor the Three Months Ended March 31, 2003 and 2002(Unaudited)



|                                                                  |  | 2003       |              | 2002 |  
|----------------------------------------------------------------- |  | ---------- | ------------ | ---- | -
|                                                                  |  | (restated) |              |      |  
|                                                                  |  |            |              |      |  
|Cash Flows From Operating Activities:                             |  |            |              |      |  
|Net loss                                                          |  | $          | (1,594,844   | )    | $
|Adjustments to reconcile net loss to net cash used by operations: |  |            |              |      |  
|Depreciation and amortization                                     |  |            | 294,230      |      |  
|Provision for loan losses                                         |  |            | 548,262      |      |  
|Valuation of interest rate swap                                   |  |            | 912,702      |      |  
|(Increase) decrease in assets:                                    |  |            |              |      |  
|Interest and other receivables                                    |  |            | (4,365,026   | )    |  
|Other assets                                                      |  |            | 329,118      |      |  
|Increase (decrease) in liabilities:                               |  |            |              |      |  
|Accounts payable                                                  |  |            | 3,379,628    |      |  
|Government payable                                                |  |            | 1,054,661    |      |  
|Accrued expenses                                                  |  |            | (1,250,367   | )    |  
|                                                                  |  |            |              |      |  
|Net cash (used in) operating activities                           |  |            | (691,636     | )    |  
|                                                                  |  |            |              |      |  
|Cash flows from investing activities:                             |  |            |              |      |  
|Origination/Purchase of student loans                             |  |            | (445,194,159 | )    |  
|Acquisition of property and equipment                             |  |            | (176,717     | )    |  
|                                                                  |  |            |              |      |  
|Net cash (used in) investing activities                           |  |            | (445,370,876 | )    |  
|                                                                  |  |            |              |      |  
|Cash flows from financing activities:                             |  |            |              |      |  
|Net proceeds from credit facility                                 |  |            | 471,601,403  |      |  
|Net payments on Series 2002 Notes                                 |  |            | (21,525,554  | )    |  
|Payment of loan fees                                              |  |            | (582,241     | )    |  
|Proceeds from issuance of stock                                   |  |            | 173,816      |      |  
|                                                                  |  |            |              |      |  
|Net cash provided by financing activities                         |  |            | 449,667,424  |      |  
|                                                                  |  |            |              |      |  
|Net increase (decrease) in cash                                   |  |            | 3,604,912    |      |  
|Cash and cash equivalents at beginning of period                  |  |            | 2,042,527    |      |  
|                                                                  |  |            |              |      |  
|Cash and cash equivalents at end of period                        |  | $          | 5,647,439    |      | $
|                                                                  |  |            |              |      |  

See accompanying notes

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Education Lending Group, Inc.(Formerly Direct III Marketing, Inc.)Consolidated Notes to Financial StatementsMarch
31(Unaudited)

Note 1  Statement of Accounting Principles

New Accounting Pronouncements

SFAS 148, Accounting for Stock-Based Compensation  Transition and Disclosure  an
amendment of SFAS 123

In December 2002, the FASB issued SFAS 148, Accounting for Stock-Based Compensation  Transition and Disclosure  an
amendment of SFAS 123. SFAS 148 addresses transition provisions for a voluntary change to the fair value method of accounting for stock-based employee compensation. In addition, the Statement amends the disclosure requirements of Statement
123. The Company has determined that SFAS 148 will not have a significant impact on its consolidated financial statements. The Company continues to account for its incentive based compensation using the intrinsic value method under APB 25. Had
compensation cost for the Companys stock options been recognized based upon the estimated fair value on the grant date under the fair value methodology prescribed by SFAS 123 as amended by SFAS 148, the Companys net earnings and earnings
per share would have been as follows:



|                                                                                                            |  | March 31, 2003 (restated) |            | March 31, 2002 |  
|----------------------------------------------------------------------------------------------------------- |  | ------------------------- | ---------- | -------------- | -
|                                                                                                            |  |                           |            |                |  
|Net loss, as reported                                                                                       |  | $                         | (1,594,844 | )              | $
|Deduct, total stock-based compensation expense determined under fair value based method, net of tax effects |  |                           | (207,748   | )              |  
|                                                                                                            |  |                           |            |                |  
|Pro forma net loss                                                                                          |  | $                         | (1,802,592 | )              | $
|Loss per share:                                                                                             |  |                           |            |                |  
|Basic & Diluted as Reported                                                                                 |  |                           | (0.14      | )              |  
|Basic & Diluted pro forma                                                                                   |  |                           | (0.16      | )              |  

As required by SFAS 123, the Company provides the following disclosure of
hypothetical values for the net options issued during 2003. The net stock options granted during the quarter ended March 31, 2003 are valued at $4.04. These values were estimated using the Black-Scholes option-pricing model with the following
weighted-average assumptions for the quarter ended March 31, 2003: expected volatility of 92%, risk free interest rate of 3.91% and expected life of 9.33 years.

Note 3-Restatement of Quarterly Results

> During our review of our 2003 year-end financial statements we discovered a computational error related to the sale of consolidation loans during the first and second quarters of 2003. Loan servicing set-up fees should
> have been written off against the gain on sale instead of continuing to be amortized when the related consolidation loans were sold.  We have restated our consolidated financial statements to reflect the changes related to this
> adjustment.  Following is a summary of the changes to our consolidated balance sheet at March 31, 2003, and for our consolidated statement of income and our consolidated statement of cash flows for the three months ended March 31,
> 2003.

|Consolidated Balance Sheet as of March 31, 2003       |  | As previously reported |               | As restated |  
|----------------------------------------------------- |  | ---------------------- | ------------- | ----------- | -
|                                                      |  |                        |               |             |  
|Student loans, net of loan loss reserve (securitized) |  | $                      | 953,159,016   |             | $
|Total assets                                          |  |                        | 1,903,864,505 |             |  
|Accumulated deficit                                   |  |                        | (35,060,946   | )           |  
|Total stockholders' deficit                           |  |                        | (26,656,263   | )           |  
|                                                      |  |                        |               |             |  



|Consolidated Statement of Operations for the three months ended March 31, 2003 |  |   | As previously reported |   |   | As restated |  
|------------------------------------------------------------------------------ |  | - | ---------------------- | - | - | ----------- | -
|                                                                               |  |   |                        |   |  
|Loan servicing and other fees                                                  |  | $ | 739,414                |   | $ | 733,977     |  
|Gain on sale of student loans                                                  |  |   | 8,142,188              |   |   | 7,741,418   |  
|Net loss                                                                       |  |   | (1,199,511             | ) |   | (1,594,844  | )
|Net loss per share                                                             |  |   | (0.11                  | ) |   | (0.14       | )



|Weighted average common shares outstanding                                     |  |   |                        |   |   |              |  
|------------------------------------------------------------------------------ |  | - | ---------------------- | - | - | ------------ | -
|Basic & Diluted                                                                |  |   | 11,311,164             |   |   | 11,311,164   |  
|                                                                               |  |   |                        |   |   |              |  
|Consolidated Statement of Cash Flows for the three months ended March 31, 2003 |  |   | As previously reported |   |   | As restated  |  
|                                                                               |  |   |                        |   |  
|Net Loss                                                                       |  | $ | (1,199,511             | ) | $ | (1,594,844   | )
|Net cash used in operating activities                                          |  |   | (296,303               | ) |   | (691,636     | )
|Origination/purchase of student loans                                          |  |   | (445,589,492           | ) |   | (445,194,159 | )
|Net cash used in investing activities                                          |  |   | (445,766,209           | ) |   | (445,370,876 | )

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Report of Independent Accountants

To the Board of
Directors and Stockholders of Education Lending Group, Inc.:

We have reviewed the accompanying consolidated balance sheet of Education Lending Group, Inc. and its subsidiaries
(the Company) as of March 31, 2003 and the related consolidated statements of operations, changes in stockholders deficit and cash flows for the three-month period ended March 31, 2003. These interim financial statements are the
responsibility of the Companys management. The consolidated statements of operations, changes in stockholders deficit and cash flows for the three-month period ended March 31, 2002 were reviewed by other independent
accountants.

We conducted our review in accordance with standards established by the American Institute of Certified Public Accountants. A review of interim financial information consists principally of applying analytical procedures and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope
than an audit conducted in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.

Based on our review, after the restatement described in Note 3, we are not aware of any material modifications that should be made to the accompanying consolidated interim financial statements
for them to be in conformity with accounting principles generally accepted in the United States of America.

We previously audited in accordance with auditing standards generally
accepted in the United States of America, the consolidated balance sheet as of December 31, 2002, and the related consolidated statements of operations, changes in stockholders deficit and cash flows for the year then ended (not presented
herein), and in our report dated February 27, 2003 we expressed an unqualified opinion on those consolidated financial statements. In our opinion, the information set forth in the accompanying consolidated balance sheet as of March 31, 2003, is
fairly stated in all material respects in relation to the consolidated balance sheet from which it has been derived.



PricewaterhouseCoopers LLP Los Angeles, CA
May 12, 2003, except for Note 3, as to which the date is February 19, 2004

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##### Table of Contents

Item 2.

Managements Discussion and Analysis of Financial Condition and Results of
Operations.

As announced in a press release dated February 26, 2004, as the result of a $468,000
computational error, Education Lending Group, Inc. is restating its consolidated results for the first, second and third quarters of 2003. Loan servicing set-up fees should have been written off against the gain on sale instead of
continuing to be amortized when the related consolidated loans were sold. We are filing this Form 10-QSB/A to report the results for the first quarter of 2003, as restated and as discussed in Note 3 to the Consolidated Financial Statements. Other
than as set forth below, the restatement does not impact any of the financial or other information set forth in the original filing of our Form 10-QSB for the period ended March 31, 2003. Effective as of December 31, 2003, Education Lending Group,
Inc. is no longer a small business issuer. In the future, we will report our quarterly results on Form 10-Q and our annual results on Form 10-K. Amounts impacted by the restatement referred to in Managements Discussion and Analysis of
Financial Condition and Results of Operations that were impacted by the restatement are restated below.

RESULTS OF OPERATIONS

For the three months ended March 31, 2003 and 2002

Earnings Summary

For the three months ended March 31, 2003, the Companys net loss calculated was $(1.6) million, or $(0.14) per share, compared to a net loss of $(4.8) million, or $(0.51) per share for the three months ended March 31, 2002. The
decreased loss for the period is attributable mostly to the sale of approximately $206 million of consolidation loans (the Company sold the consolidation loans during the period to raise cash for operations) which resulted in gain on sale of roughly
$6.8 million. The Company expenses during the period included the payments made to marketing partners who advertise, identify and attract potential borrowers for the Company. As the loan volume for a particular period increases, marketing partner
fees increase. These marketing partner fees are a significant portion of the Companys expenses. During the quarter, these marketing partner fees represented 58% of the total operating expenses of the Company. Additionally, the Company
increased its student loan asset base during the quarter by roughly $445,000,000 to approximately $1,794,000,000. Since the Company only earns an interest spread on the loans added to its balance sheet, the marketing partner fee expense along with
other sales and marketing expenses results in significant losses until such time as a significant scale of student loan assets is reached on the balance sheet.

Net Interest
Income

Net interest income is derived largely from the Companys portfolio of student loans that remain on the balance sheet and is the spread between interest earned on
student loans and the Companys cost of generating that interest income. All servicing of the Companys student loans is outsourced to third party servicers. For the three months ended March 31, 2003, loan servicing and other fees were
approximately $734,000 compared to approximately $280,000 for the three months ended March 31, 2002. The cost of interest income on the income statement consists of the costs paid to a third party servicer to service the loans, interest expense on
the warehouse facility and permanent financings, amortization of the Department of Education fees, and amortization of premiums paid to acquire student loans. Net interest income during the three months ended March 31, 2003 was $4,600,000. This was
comprised of gross interest income of approximately $14,900,000 less interest costs (including the mark to the market adjustment of $912,702 for the interest rate swap entered into during the fourth quarter of 2002) of approximately $10,300,000. Net
interest income after the provision for loan losses was approximately $4,100,000. Net interest income during the three months ended March 31, 2002 was $325,000. This was comprised of gross interest income of approximately $1,276,000 less interest
costs of approximately $951,000. Net interest income after the provision for loan losses was approximately $162,000. The increase in the net interest income earned by the Company during the quarter is a direct result of the increase in the student
loan assets held by the Company.

Gain on Sale of Student Loans

In general, the Company currently
sells the majority of loans it originates in the traditional lender-list marketing channel, Student Loan Xpress, Inc. (SLX), while retaining loans originated in the consolidation marketing channel. The SLX business is rather seasonal as
the majority of the loans are originated in the August/September/October and January/February/March time frame which corresponds to the college disbursement calendar. For the three months ended March 31, 2003 approximately $939,000 was booked as
gain on the sale of student loans from this entity compared with $4,000 during the three months ended March 31, 2002. The increase from the first quarter of 2002 to the first quarter 2003 is attributable to having a full year of operations leading
into the quarter whereas the first quarter of 2002 was the first months of operations for SLX.

In addition to the sale of loans generated in the SLX business during the
quarter, the Company also chose to sell approximately $206,000,000 of consolidation loans. This resulted in additional gain on sale of approximately $6,800,000 for the three months ended March 31, 2002 compared to no sales from this source in the
first quarter of 2002. As a result, the Company had total gain on sale during the three months ended March 31, 2003 of roughly $7,700,000 compared to $4,000 during the same period in 2002.

LIQUIDITY AND CAPITAL RESOURCES

At March 31, the Company had operating cash and cash equivalents of approximately $5,600,000, (excluding
restricted cash and investments). Since inception the Company has financed its operations from debt and equity financings. During the three months ended March 31, 2003, the Company used cash of approximately $692,000 to fund its operations. During
the three months ended March 31, 2003, the Company acquired property and equipment of approximately $200,000. For the three months ended March 31, 2003, the Company has been advanced $900,001,221 ($471,601,403 of this amount was advanced in the
first quarter of 2003) from the warehouse loan facilities and holds $1,013,000,000 from the Auction Rate Education Loan Backed Notes (Series 2002 Notes) at March 31, 2003. During the three months ended March 31, 2003, the Company had
funded approximately $445,000,000 in student loans. During the three months ended March 31, 2003, the Company received proceeds of $173,816, net of issuance costs, related to

9



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##### Table of Contents

the purchase of 162,166 shares of common stock in connection with the exercise of warrants and employee stock options.

Item 3.

Controls and Procedures

Based
on their most recent evaluation, which was completed within 90 days of the filing of this Form 10-QSB/A, our principal executive officer and principal financial officer believe our disclosure controls and procedures (as defined in Exchange Act Rules
13a-14 and 15d-14) require specific modifications to insure that all financial reporting and disclosures are accurate. We are in the process of developing improved internal control processes and expect to implement them during the first quarter of
2004.  We believe these changes will enhance the accuracy of all future financial reports.

PART II.OTHER INFORMATION

Item 6.

Exhibits and Reports on Form 8-K

(a)

Exhibits.

The exhibits listed below are filed as part of this document.



|ExhibitNumber | Description                                             
|------------- | --------------------------------------------------------
|              |                                                         
|31.1          | CEO Certification under Sarbanes-Oxley Act (Section 302)
|              |                                                         
|31.2          | CFO Certification under Sarbanes-Oxley Act (Section 302)
|              |                                                         
|32.1          | CEO Certification under Sarbanes-Oxley Act (Section 906)
|              |                                                         
|32.2          | CFO Certification under Sarbanes-Oxley Act (Section 906)

(b)

Form 8-K.

Not
Applicable.

10



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##### Table of Contents

SIGNATURES

In accordance with the
requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



|Date: February 27, 2004 |  | EDUCATION LENDING GROUP, INC.
|----------------------- |  | -----------------------------
|                        |  | By:                          
|                        |  |                              
|                        |  | Name:                        
|                        |  | Title:                       

11