Exhibit 10.5


 


FOURTH
SUPPLEMENT


TO


MASTER
LOAN GUARANTY AGREEMENT


 


This FOURTH SUPPLEMENT TO
MASTER LOAN GUARANTY AGREEMENT (this “Supplement”) is made and entered into by
and between THE EDUCATION RESOURCES INSTITUTE, INC. (“TERI”), a private
non-profit corporation organized under Chapter 180 of the Massachusetts General
Laws, with its principal place of business at Park Square Building, 4th
Floor, 31 St. James Avenue, Boston, Massachusetts 02116 and THE FIRST
MARBLEHEAD CORPORATION (“FMC”), a Delaware corporation having a principal place
of business at 800 Boylston Street, 34th Floor Boston, Massachusetts
02199-8157.  This supplements the MASTER
LOAN GUARANTY AGREEMENT dated as of February 2, 2001, entered into by TERI and
FMC, and previously supplemented in a First Supplement to Master Loan Guaranty
Agreement dated February 1, 2002 (“First Supplement”), a Second Supplement to
Master Loan Guaranty Agreement dated January 1, 2004 (“Second Supplement”), a
Third Supplement to Master Loan Guaranty Agreement dated as of May 1, 2004 (the
“Third Supplement”), and a Supplement to Master Loan Guaranty Agreement 2004
S-1 (“Supplement 2004 S-1”) dated June 1, 2004 (as so supplemented, the “MLGA”).


 


This Supplement is dated
as of October 1 2004. Capitalized terms used herein without definition have the
meanings set forth in the MLGA.


 


WHEREAS, TERI desires to
better match the timing of its cash flows from Securitization Transactions to
its costs of loan origination and other current operations;


 


WHEREAS, FMC has agreed to
modify certain current practices in the structure of Securitizations required
under the MLGA to assist TERI in this regard, in particular to make more than
the first one and one half percentage points (1.5%) of guarantee fees collected
by TERI available outside the Pledge Account; and


 


WHEREAS TERI desires to
elect to make adjustments to its cash and deferred cash revenues from
Securitization on an annual basis as described herein.


 


NOW THEREFORE


 


In consideration of these
presents and the covenants contained herein, the parties hereto herby agree as
follows:


 


1.  Amount of Fee.  TERI shall have the right, as set forth
herein, to adjust the amount of guaranty fees that are held in the Pledged
Account (and the corresponding amount available for other uses by TERI) by 25
basis points (.25%) multiplied by the principal amount of TERI-guaranteed loans
included in a particular Securitization Transaction (the “Additional
Administration Fee”).


 


2.  TERI Election.  TERI shall elect once each fiscal year, in
conjunction with the approval of the annual budget for FMER under that certain
Master Servicing Agreement between FMER and TERI dated as of July 1, 2001,
whether or not to receive the Additional Administration Fee in each
Securitization Transaction structured by FMC in the fiscal year.  TERI shall be deemed to have timely elected
to receive the Additional Administration Fee for the fiscal year that began
July 1, 2004.


 


3.  Transfer and Reconciliation.  If TERI shall have elected to receive the
Additional Administration Fee, then FMC shall structure the affected
Securitization Transactions such that the 


 





















 


Additional Administration
Fee is released to TERI from the Pledged Account at the time that the amount of
the Pledged Account is transferred to the Purchaser Trust.  The Additional Administration Fee shall be
computed based upon the principal amount of TERI-guaranteed loans as estimated
on the closing date of any Securitization Transaction and shall be reconciled
based on final portfolio information in conjunction with reconciliation of the
Securitization Transaction generally.


 


4.  Equity Adjustment.  TERI agrees that each Securitization
Transaction in which the Additional Administrative Fee is paid shall involve an
adjustment in the relative ownership percentages of residual equity interests
in the Purchaser Trust that are set forth in section 3.02 of the Master Loan
Guaranty Agreement, which percentages are currently 75% for FMC and 25% for
TERI.  In any Securitization Transaction
in which the Additional Administration Fee is payable, said equity percentages
shall equal 80% for FMC and 20% for TERI.


 


5.  Effect on Other Agreements.  Except as expressly amended herein, the MLGA
as supplemented as set forth above shall continue in full force and effect. In
particular, but not by way of limitation, supplemental origination fees payable
to TERI in accordance with the Supplement to Master Loan Guaranty Agreement
2004S-1 shall not be limited or affected by this Fourth Supplement.


 


IN WITNESS WHEREOF, the
parties hereto have caused this instrument to be executed as of the date
provided above.


 


	
  THE FIRST MARBLEHEAD
  CORPORATION

  	
   

  	
  THE EDUCATION RESOURCES

  
	
   

  	
   

  	
   

  	
  INSTITUTE, INC

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Ralph M. James

  	
   

  	
  By:

  	
  Lawrence W. O’Toole

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
  President and Chief
  Operating Officer

  	
   

  	
  Its:

  	
  President