Document:

Exhibit 10.24

 

July 26,
2010

 

BY
EMAIL

 

Gregory
Woods, Esq.

General
Counsel

THE
FIRST MARBLEHEAD CORPORATION

800
Boylston Street, 34th Floor

Boston,
MA  02199-8157

 

	
  RE:

  	
  Letter
  Agreement for Resignation of Stein Skaane

  
	
   

  	
  from
  The First Marblehead Corporation

  

 

Dear
Mr. Woods:

 

This
letter serves to confirm the terms and conditions pertaining to the resignation
of Stein Skaane (hereinafter, “Employee”) from any office, directorship or
other position that he holds with The First Marblehead Corporation and its affiliates
(hereinafter, collectively, the “Company”), including First Marblehead Data
Services, Inc. and The National Collegiate Funding II, LLC.   The Effective Date of his resignation shall
be July 22, 2010 (hereinafter, the “Effective Date”).

 

As
an inducement to the execution and delivery of this resignation letter, its
exhibits and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged and shall be conclusively
presumed, the parties hereby accept the terms and conditions stated herein
below and incorporate by reference the various exhibits as expressly
stated.  It is the intention of each
signatory that this resignation letter tendered by the Employee and its acceptance
by the Company shall be deemed a contract enforceable pursuant to the laws of
the Commonwealth of Massachusetts, that the exhibits be deemed an integral part
of this letter agreement, that each signatory possesses the requisite authority
to sign the same and its exhibits, and that each of this resignation letter and
its exhibits is the product of a negotiation by each party with the advice of
independent counsel such that neither party shall be entitled to any
presumption or disadvantage as being the author or drafter of the same.

 

Reference
is made to that certain Non-Disparagement Agreement attached hereto and
incorporated herein as Exhibit A. 
Each of the Employee and the Company will cause originals of the same to
be properly executed in duplicate and thereafter delivered to the other party.  Each 

 

 

party
shall be bound and shall otherwise comply with the terms and conditions
expressly stated therein.

 

By
no later than the end of the current payroll period, the Employee will be paid
by the Company for unused and accrued vacation in the gross amount of
$23,661.72 which amounts to a net payment after taxes of $15,669.94.  Effective as of the Effective Date, the
Employee shall be considered to have elected to continue receiving group
medical and dental insurance pursuant to the federal “COBRA” law, 29 U.S.C. §
1161 et  seq.  During the period from the Effective Date
through December 31, 2010, the Company shall continue to pay the share of
the premium for such coverage that is paid by the Company for active and
similarly-situated employees who receive the same type of coverage paid in
accordance with the Company’s regular payroll practice for group medical and
dental insurance (the “Company Contribution”). 
The remaining balance of any premium costs, and all premium costs after December 31,
2010, shall be paid by the Employee on a
monthly basis for as long as, and to the extent that, the Employee remains
eligible for COBRA continuation (the “Employee Contribution”).  Notwithstanding anything to the contrary
herein, the Company’s obligation to pay the Company Contribution is expressly
conditioned on the timely payment by the Employee of the Employee Contribution.
All other benefits, including life insurance and long-term disability, will
cease upon the Effective Date subject to any conversion rights that may
otherwise exist under any applicable policy. 
The Employee acknowledges and agrees that he is not entitled to, and
shall not, receive any severance benefits from the Company, other than payment
for his final wages, reimbursement of business expenses and any unused vacation
time accrued through the Effective Date, and further acknowledges and agrees
that he shall have no claim to any
non-vested ownership interest in the Company contractual or otherwise,
including, but not limited to, claims to stock, restricted stock units or stock
options.

 

The
Employee and Company acknowledge and affirm their respective obligations under,
and shall continue to be bound by the terms and conditions of, the Invention,
Non-Disclosure, Non-Competition and Non-Solicitation Agreement dated September 12,
2005 (the “Non-Competition Agreement”), including obligations of the Employee
to keep confidential and not disclose any and all non-public information
concerning the Company that he acquired during the course of his employment
with FMC, including any non-public information concerning the Company’s
business affairs, prospects and financial condition.  The parties agree and acknowledge that a true
and accurate copy of the Non-Competition Agreement is attached hereto as Exhibit B.

 

The
Employee hereby covenants that he will return to the Company all keys, files,
records (and copies thereof), equipment (including, but not limited to,
computer hardware, software and printers), identification and any other
Company-owned property in his possession or control.  He also represents that he has left intact
all electronic First Marblehead documents, including but not limited to, those
that the Employee developed or helped develop during his employment.  The Employee further confirms that he has
cancelled, or has provided all information necessary for the Company to cancel,
all accounts for his benefit, if any, in the Company’s name, including but not
limited to, credit cards, telephone charge cards, cellular phone and/or pager
accounts and computer accounts.  The
Company confirms it will pay in a timely manner all outstanding
business-related balances incurred by the Employee prior to the Effective Date,
and close out any credit cards issued by the Company to the Employee in a 

 

 

timely
manner.  Additionally, the Company will
deliver the Employee’s personal property promptly.  The Employee shall reimburse the Company
promptly for outstanding charges, if any, incurred by the Employee that are not
business-related.

 

The
Company may file this resignation letter, including any exhibits, with any
regulatory or self-regulatory entity having jurisdiction over the Company,
including but not limited to the U.S. Office of Thrift Supervision, the Federal
Deposit Insurance Corporation and the Securities and Exchange Commission.

 

Each
party represents to the other that this letter agreement shall be binding upon
and shall inure to the benefit of their respective heirs, successors and
assigns.

 

Effective
as of July 22, 2010.

 

	
  THE
  COMPANY:

  	
  EMPLOYEE:

  
	
   

  	
   

  
	
  THE
  FIRST MARBLEHEAD CORPORATION

  	
  STEIN
  SKAANE

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:
  

  	
  /s/ Daniel Meyers

  	
   

  	
  By:

  	
  /s/ Stein Skaane

  
	
   

  	
  Daniel Meyers

  	
   

  	
   

  	
  Stein Skaane

  
	
  Chairman
  and Chief Executive Officer

  	
   

  
	
  Duly
  Authorized

  	
   

  

 

 

NON-DISPARAGEMENT
AGREEMENT

 

THIS NON-DISPARAGEMENT AGREEMENT (“Agreement”) is made as of this 22nd day of July,
2010 (the “Effective Date”), by and between Stein Skaane (the “Employee”) and
THE FIRST MARBLEHEAD CORPORATION, a Delaware corporation having a place of
business at 800 Boylston Street, 34th Floor,
Boston, Massachusetts 02199-8157 (“FMC” and together with its subsidiaries and
affiliates, including any securitization trust facilitated by FMC, “First
Marblehead”).

 

WHEREAS, the Employee serves as an employee and
executive officer of FMC pursuant to that certain letter agreement dated
September 4, 2001; and

 

WHEREAS, the parties desire to set forth certain
terms and conditions relating to the resignation of the Employee’s employment
and positions with First Marblehead.

 

NOW, THEREFORE, in consideration of the exchange of
promises and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties, intending to be legally bound
hereby, agree to the terms and conditions of this Agreement as follows:

 

1.                                  Employee
Non-Disparagement. The Employee shall not make any false, disparaging
or derogatory statements to any individual, media outlet, industry group,
financial institution or current or former employee, consultant, client or
customer of First Marblehead regarding: (a) First Marblehead, (b) any
current, former or future director, officer, employee, agent or representative
of First Marblehead (each, a “Person”), (c) the business affairs and financial
condition of First Marblehead or (d) the circumstances surrounding the
resignation of the Employee’s employment and positions with First Marblehead; provided, however, that nothing herein
shall prevent the Employee from complying with requirements of law.

 

2.                                  First
Marblehead Non-Disparagement. FMC shall instruct its
directors and those of its officers who have knowledge of this Agreement not to
make any false, disparaging or derogatory statements to any individual, media
outlet, industry group, financial institution or current or former employee,
consultant, client or customer of First Marblehead regarding the circumstances
surrounding the Employee’s resignation of his employment and positions with
First Marblehead; provided, however, that
nothing herein shall prevent First Marblehead or any Person from complying with
requirements of law.

 

3.                                  Choice of Law. This
Agreement shall be construed, interpreted and enforced in accordance with the
laws of the Commonwealth of Massachusetts without reference to the conflict of
law provisions thereof. The parties hereby irrevocably submit to and
acknowledge and recognize the jurisdiction of the courts of the Commonwealth of
Massachusetts, or if appropriate, a federal court located in the Commonwealth
of Massachusetts (which courts, for purposes of this Agreement, are the only
courts of competent jurisdiction), over any suit, action or other proceeding
arising out of, under or in connection with this Agreement or the subject
matter hereof.

 

4.                                       Counterparts. For the
convenience of the parties, this Agreement may be executed by facsimile and in
counterparts, each of which shall be deemed to be an original, and both of
which, taken together, shall constitute one agreement binding on both parties.

 

IN WITNESS WHEREOF, the parties hereto have executed
this Non-Disparagement Agreement as of the day and year first written above.

 

	
  THE
  FIRST MARBLEHEAD CORPORATION

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/
  Daniel Meyers

  	
   

  	
  By:

  	
  /s/
  Stein Skaane

  
	
   

  	
  Daniel
  Meyers

  	
   

  	
   

  	
  Stein
  Skaane

  
	
   

  	
  Chairman
  and Chief Executive Officer

  	
   

  	
   

  	
   

  

 

 

 FirstMarblehead

 

INVENTION, NON-DISCLOSURE, NON COMPETITION AND NON-SOLICITATON
AGREEMENT

 

This Agreement is made
between The First Marblehead Corporation, a Delaware corporation (hereinafter
referred to collectively with its subsidiaries as the “Company”), and “Stein
Skaane” (the “Employee”). 

Employee
name

 

In consideration of the employment or the continued employment of the
Employee by the Company, the Company and the Employee agree as follows:

 

1. Proprietary Information

a) The Employee agrees that all information, whether or not in
writing, of a confidential nature concerning the Company’s business
(collectively, “Proprietary Information”) is and shall be the exclusive
property of the Company. The Employee will not disclose any Proprietary
Information to any person or entity other than employees of the Company or use
the same for any purposes (other than in the performance of his/her duties as
an employee of the Company) without written approval by an officer of the
Company, either during or after his/her employment with the Company, unless and
until such Proprietary Information has become public knowledge without fault by
the Employee.

 

b) The Employee agrees that all materials
containing Proprietary Information, whether created by the Employee or others,
which shall come into his/her custody or possession, shall be and are the
exclusive property of the Company to be used by the Employee only in the
performance of his/her duties for the Company. All such materials or copies
thereof and all tangible property of the Company in the custody or possession
of the Employee shall be delivered to the Company, upon the earlier of (i) a
request by the Company or (ii) termination of his/her employment. After
such delivery, the Employee shall not retain any such materials or copies
thereof or any such tangible property.

 

c) The Employee agrees that his/her obligation not to disclose or
to use information and materials of the types set forth in paragraphs
(a) and (b)

 

 

above, and his/her obligation to return materials and tangible
property, set forth in paragraph (b) above, also extends to such types of
information, materials and tangible property of customers of the Company or
other third parties who may have disclosed or entrusted the same to the Company
or to the Employee.

 

2. Developments

a) The Employee will make full and prompt disclosure to the Company of
all inventions, improvements, discoveries, methods, developments, software, and
works of author ship, whether patentable or not, which are created, made, conceived
or reduced to practice by him/her or under his/her direction or jointly with
others during his/her employment by the Company, whether or not during normal
working hours or on the premises of the Company (all of which are collectively
referred to in this Agreement as “Developments”).

 

b) The Employee agrees to assign and does
hereby assign to the Company (or any person or entity designated by the
Company) all his/her right, title and interest in and to all Developments and
all related patents, patent applications, copyrights and copyright
applications. However, this paragraph 2(b) shall not apply to Developments
which do not relate to the business or research and development conducted or
planned to be conducted by the Company at the time such Development is created,
made, conceived or reduced to practice and which are made and conceived by the
Employee not during normal working hours, not on the Company’s premises and not
using the Company’s tools, devices, equipment or Proprietary Information. The
Employee understands that, to the extent this Agreement shall be construed in
accordance with the laws of any state which precludes a requirement in an
employee agreement to assign certain classes of inventions made by an employee,
this paragraph 2(b) shall be interpreted not to apply to any invention
which a court rules and/or the Company agrees falls within such classes.

 

c) The Employee agrees to cooperate fully with the
Company, both during and after his/her employment with the Company, with
respect to the procurement, maintenance and enforcement of copyrights, patents
and other intellectual property rights (both in the United States and foreign
countries) relating to Developments. The Employee shall sign all papers which
the Company may deem necessary or desirable in order to protect its rights and
interests in any Development. The Employee further agrees that if the Company
is unable, after reasonable effort, to

 

 

secure the signature of the Employee on any such papers, any executive
officer of the Company shall be entitled to execute any such papers as the
agent and the attorney-in-fact of the Employee, and the Employee hereby
irrevocably designates and appoints each executive officer of the Company as
his/her agent and attorney-in-fact to execute any such papers on his/her
behalf, and to take any and all actions as the Company may deem necessary or
desirable in order to protect its rights and interests in any Development,
under the conditions described in this sentence.

 

3. Other Agreements

The Employee hereby represents that, except as the Employee has
disclosed in writing to the Company, the Employee is not bound by the terms of
any agreement with any previous employer or other party to refrain from using
or disclosing any trade secret or confidential or proprietary information in
the course of his/her employment with the Company, to refrain from competing,
directly or indirectly, with the business of such previous employer or any
other party or to refrain from soliciting employees, customers or suppliers of
such previous employer or other party. The Employee further represents that
his/her performance of all the terms of this Agreement and the performance of
his/her duties as an employee of the Company do not and will not breach any
agreement with any prior employer or other party to which the Employee is a
party (including without limitation any nondisclosure or non-competition
agreement), and that the Employee will not disclose to the Company or induce
the Company to use any confidential or proprietary information or material
belonging to any previous employer or others.

 

4. Non-Competition and
Non-Solicitation

While the Employee is employed by the Company and for a period of one
year after the termination or cessation of such employment for any reason, the
Employee will not directly or indirectly:

 

a) Engage in any business or enterprise (whether as owner, partner,
officer, director, employee, consultant, investor, lender or otherwise, except
as the holder of not more than 1% of the outstanding stock of a publicly-held
company) that is competitive with the Company’s business, including but not
limited to any business or enterprise that develops, manufactures, markets,
licenses, sells or provides any product or service that competes with any
product or service developed,

 

 

manufactured, marketed, licensed, sold or provided, or planned to be
developed, manufactured, marketed, licensed, sold or provided, by the Company
while the Employee was employed by the Company; or

 

b) Either alone or in association with others (i) solicit, or
permit any organization directly or indirectly controlled by the Employee to
solicit, any employee of the Company to leave the employ of the Company, or
(ii) solicit for employment, hire or engage as an independent contractor,
or permit any organization directly or indirectly controlled by the Employee to
solicit for employment, or hire or engage as an independent contractor, any
person who was employed by the Company at any time during the term of the
Employee’s employment with the Company; provided, that this clause
(ii) shall not apply to the solicitation, hiring or engagement of any
individual whose employment with the Company has been terminated for a period
of six months or longer.

 

5. No Employment Contract

The Employee understands that this Agreement does not constitute a
contract of employment and does not imply that his/her employment will continue
for any period of time.

 

6. Miscellaneous

a) The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement.

 

b) If the Employee violates the provisions of Section 4, the
Employee shall continue to be bound by the restrictions set forth in
Section 4 until a period of one year has expired without any violation of
such provisions.

 

c) If any restriction set forth in Section 4 is
found by any court of competent jurisdiction to be unenforceable because it
extends for too long a period of time or over too great a range of activities
or in too broad a geographic area, it shall be interpreted to extend only over
the maximum period of time, range of activities or geographic area as to which
it may he enforceable.

 

d) This Agreement supersedes all prior agreements,
written or oral, between the Employee and the Company relating to the subject
matter

 

 

of this Agreement. This Agreement may not be modified, changed or
discharged in whole or in part, except by an agreement in writing signed by the
Employee and the Company. The Employee agrees that any change or changes in
his/her duties, salary or compensation after the signing of this Agreement
shall not affect the validity or scope of this Agreement.

 

e) This Agreement will be binding upon the Employee’s heirs, executors
and administrators and will inure to the benefit of the Company and its
successors and assigns.

 

f) No delay or omission by the Company in exercising any right under
this Agreement will operate as a waiver of that or any other right. A waiver or
consent given by the Company on any one occasion is effective only in that
instance and will not be construed as a bar to or waiver of any right on any
other occasion.

 

g) The restrictions contained in this Agreement are
necessary for the protection of the business and goodwill of the Company and
are considered by the Employee to be reasonable for such purpose. The Employee
agrees that any breach of this Agreement is likely to cause the Company
substantial and irrevocable damage which is difficult to measure. Therefore, in
the event of any such breach or threatened breach, the Employee agrees that the
Company, in addition to such other remedies which may be available, shall have
the right to specific performance of the provisions of this Agreement and shall
have the right to obtain an injunction from a court restraining such a breach
or threatened breach, and the Employee hereby waives the adequacy of a remedy
at law as a defense to such relief.

 

h) This Agreement is governed by and will be
construed as a sealed instrument under and in accordance with the laws of the

Commonwealth of Massachusetts (without reference to the conflicts of
laws provisions thereof). Any action, suit, or other legal proceeding which is
commenced to resolve any matter arising under or relating to any provision of
this Agreement shall be commenced only in a court of the Commonwealth of
Massachusetts (or, if appropriate, a federal court located within
Massachusetts), and the Company and the Employee each consents to the
jurisdiction of such a court.

 

 

THE EMPLOYEE ACKNOWLEDGES THAT HE/SHE HAS CAREFULLY READ THIS AGREEMENT
AND UNDERSTANDS AND AGREES TO ALL OF THE PROVISIONS IN THIS AGREEMENT.

 

 

THE FIRST MARBLEHEAD CORPORATION

	
  Date:

  	
  9/8/05

  	
   

  
	
  By: 

  	
  /s/ Robin Camara

  	
   

  
	
  Print Name: Robin Camara

  	
   

  
	
  Title: Senior Vice
  President, Human Resources

  	
   

  
	
   

  	
   

  	
   

  
	
  EMPLOYEE

  	
   

  
	
  Date:

  	
  9/12/05

  	
   

  
	
  Employee Signature:

  	
  /s/ Stein SkaaneExhibit 10.38

 

Confidential
Materials omitted and filed separately with the

Securities
and Exchange Commission.  Asterisks
denote omissions.

 

PRIVATE
STUDENT LOAN MONOGRAM PROGRAM AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

 

THIS PRIVATE STUDENT LOAN
PROGRAM AGREEMENT (this “Agreement”) is made and dated as of February 5,
2010, 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”).

 

RECITALS

 

WHEREAS, Servicer was
created by the Commonwealth of Pennsylvania by the Act of August 7, 1963,
P.L. 549 for the purpose of improving higher educational opportunities and to
that end Servicer is empowered to make, guarantee, undertake commitments to
make or acquire and participate with lending or postsecondary institutions in
the making of loans, servicing of loans, or otherwise providing loans of money
to students; and

 

WHEREAS, Servicer has
developed its loan servicing system (the “Loan Servicing System”) for the
purpose of servicing Student Loans (as defined herein); and

 

WHEREAS, Servicer has
developed various web-based products (“PHEAA Web-based Products”), which
provide on-line automated capabilities to enhance services rendered to student
borrowers; and

 

WHEREAS, Servicer has
developed support services (“Support Services”) to enhance the Loan Servicing
System and the PHEAA Web-based Products (collectively the “PHEAA System”), to
include technical support, help desk, communications support, and information
technology staff time; and

 

WHEREAS, the Servicer
has expertise in the business of servicing private student loans and other
education loans for lenders; and

 

WHEREAS, certain
financial institutions (the “Lender Participants”) and FMC have created a group
of education loan programs (“Programs”), and FMC and the Lender Participants
are responsible for structuring and assisting in implementing the Programs; and

 

WHEREAS, the Lender
Participants and FMC desire to utilize the expertise of the Servicer to service
such education loans on behalf of the Lender Participants and the Lender
Participants desire to have FMC or an affiliate thereof provide Administrator
Services (as defined below) in connection with a Private Student Loan Servicing
Agreements among Servicer, each Lender Participant, and FMC (the “Lender
Participant Servicing Agreements”); and

 

WHEREAS, Servicer and
FMC will work collaboratively on future refinements and enhancements to the
servicing procedures for the Programs; and

 

WHEREAS, Servicer and
FMC desire to set forth certain terms and conditions related to FMC’s role in
providing Administrator Services;

 

NOW, THEREFORE, in
consideration of the mutual covenants and promises contained in this Agreement
and other valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, and intending to be legally 

 

 

bound, Servicer and FMC (hereinafter, the
“Parties”) do hereby agree to the following:

 

SECTION 1.  DEFINITIONS

 

1.01         “Account” means
the Student Loans collectively of an individual Borrower owned by an Owner and
for which FMC (and its affiliates) serves as Program Administrator, which are
serviced pursuant to the Lender Participant Servicing  Agreements.

 

1.02         “Administrator
Services” means the services provided by FMC or its affiliates, and includes,
but is not limited to post-disbursement portfolio administration, as further
described in this Agreement.

 

1.03         “Agreement”
means this Private Student Loan Program Agreement, including each Schedule
provided for herein and each amendment hereafter adopted.

 

1.04         “Borrower”
means an individual who is the maker of a Credit Agreement and who obtains a
Student Loan. “Borrower” includes both the primary obligor and any Cosigner.

 

1.05         “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.

 

1.06         “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.

 

1.07         “Cosigner”
means an individual who is the maker of a Credit Agreement as a cosigner on a
Student Loan.

 

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

 

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

 

1.10         “Effective Date”
means the date this Agreement has been executed by all Parties and is approved
as to form and legality by the Office of Attorney General of the Commonwealth
of Pennsylvania.

 

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

 

1.12         “FMC” means The
First Marblehead Corporation in its capacities as “FMC” and “Program
Administrator” (as defined herein).

 

1.13         “FMC
Administrator Loans” shall have the meaning assigned to it in Section 2.02.

 

1.14         “FMER” means
First Marblehead Education Resources, Inc., an affiliate of FMC.

 

1.15         “Lender
Participant” means a financial institution which is a lender in one or more of
the Programs.

 

1.16         “Milestone”
shall have the meaning given to it in Section 4.02(d).

 

1.17         “Private Student
Loan” or “PSL” means an education loan funded by a Lender Participant to
finance the costs of higher education (or private K-12 education) that is not
guaranteed by the United States Department of Education nor by any state or
agency of any state.

 

1.18         “Program
Administrator” means FMC (and its affiliate FMER) in its performance of
Administrator Services as set forth in this Agreement.

 

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

 

2

 

1.20         “Service”, “Services”,
“Serviced”, “Servicing” shall mean to perform, the terms and conditions of the
Credit Agreements, the Servicing Guidelines, and the terms and conditions of
this Agreement: duties, obligations, and procedures that are required of
Servicer hereunder and under the Lender Participant Servicing Agreements in
connection with Student Loans.

 

1.21         “Servicing
Guidelines” means, as applicable, the Servicing Guidelines for one or more
Private Student Loan programs that have been issued by a Lender Participant and
approved by FMC and Servicer attached to and made part of each Lender
Participant Servicing Agreement, all as may amended by the Parties pursuant to
the terms thereof.

 

1.22         “Service Level
Schedule” means the Service Level
Schedule attached hereto, as amended by agreement of the parties.

 

1.23         “Statement of
Work” means the document that includes, without limitation, the requirements
for FMC-requested changes to the Loan Origination System or procedures, as well
as the identified persons working on the project, time estimates for
completion, the costs for the project and any recurring fees thereafter.

 

1.24         “Student Loan”
means any of, and “Student Loans” means all, the Private Student Loans executed
by a Borrower, funded by a Lender Participant, administered by Program
Administrator, and Serviced by the Servicer pursuant to a Lender Participant
Servicing Agreement.

 

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

 

SECTION 2.  SCOPE OF AGREEMENT

 

2.01        Services.  The Servicer agrees, in consideration of
certain fees, to perform the Services set forth in this Agreement, including
each Schedule (including without limitation the Service Level Schedule and the
Customer Service Schedule) attached hereto, and any additional Services which
FMC or Lender Participant 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.

 

2.02        Role
of FMC as Program Administrator.

 

Servicer acknowledges that
FMC (including its affiliates), may enter Lender Participant Servicing
Agreements from time to time with Servicer and Lender Participants to act as
Program Administrator with respect to Private Student Loans.

 

Servicer hereby authorizes
FMC to offer Servicer’s post-disbursement servicing and FMC’s administration
services to prospective Lender Participants. Upon the execution and
effectiveness of a Lender Participant Servicing Agreement, Servicer shall (a) perform
all services set forth in such Lender Participant Servicing Agreement for the
Private Student Loans owned by the Lender Participant (the “FMC Administrator
Loans”), and (b) where appropriate, communicate with Program Administrator
on behalf of the Lender Participant for the Student Loans so owned and
identified. Without limiting the foregoing, Servicer shall provide the Services
(as set forth in this Agreement and/or required by the Servicing Guidelines) to
Lender Participant and Program Administrator, including but not limited to:

 

i.              product set-up
and conversion;

ii.             loan document
custodial services;

iii.            remote system
access;

iv.            reports,
records, and other documents and data;

v.             customer
service;

vi.            borrower
billing and correspondence;

vii.           collection of
borrower payments;

viii.          privacy policy
distribution;

 

3

 

 

ix.            due diligence
and default prevention (except as set forth in Section 4.21);

x.             governmental
reporting and reporting to consumer reporting agencies; and

xi.            copies of
required notices, including but not limited to notices of failed standards,
security breaches, and OFAC violations.

 

SECTION 3.  TERM OF AGREEMENT

 

This Agreement shall
commence on the Effective Date and shall continue for a period of three (3) years,
and thereafter for so long as any Lender Participant Servicing Agreement shall
remain in effect, unless this Agreement is terminated by either party pursuant
to Section 14. With respect to product setup and conversion 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 fees charged for the Services shall be subjected to annual
adjustment under the terms and conditions of Section 5.05.

 

SECTION 4.  SERVICING DUTIES

 

4.01        Servicing Duties.  Servicer shall provide and
perform the Services in full compliance with: the terms of this Agreement and the Servicing Guidelines.  The Lender Participant shall be responsible
for the legal compliance of the content of the Program Guidelines, Credit
Agreements, privacy policies and disclosures and notices required by state law.

 

4.02        Product Setup and Conversion.   Servicer
agrees to perform product set-up and conversion Services with respect to any
FMC Administrator Loans which shall include, without limitation, the following:

 

(a)           Credit
Agreement Forms.  Servicer shall promptly review Credit
Agreement forms that are proposed by Lender Participant (or Program
Administrator on behalf of Lender Participant) 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 Lender Participant (or Program
Administrator on behalf of Lender Participant) for the launch of new products
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.
For new loan programs, where changes do not require system changes other than
table set-up, Servicer shall make every effort to meet live program dates
requested by FMC, which date shall be no less than thirty (30) days, but not
more than sixty (60) days from the date Servicer accepts (such acceptance not
to be unreasonably withheld) 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 Lender Participant. For existing loan
programs, where changes do not require system changes other than table set-up,
Servicer shall make every effort to meet live program dates requested by FMC,
which date shall be no less than fourteen (14) days, but not more than thirty
(30) days from the date Servicer accepts (such acceptance not to be
unreasonably withheld) the product and pricing matrix (or similar document
containing the same information) for modifications to such program. Lender
Participant (and Program Administrator on its behalf) shall have the right to
audit Servicer’s Servicing matrices and program setup as set forth in Section 4.02(d) below.

 

(c)           Conversion.  Servicer agrees to accurately
convert all FMC Administrator Loan origination data provided by Program
Administrator, which is necessary for servicing hereunder onto the PHEAA
System. Servicer shall also, in a timely manner, return to the Servicer
Relations Group at Program Administrator all loan files sent to the Servicer in
error. Upon the identification of files which were sent in error, Servicer
shall have no responsibility for such files other than the return of such files
to Program Administrator or 

 

4

 

Lender
Participant.

 

(d)           Periodic Audit. Servicer
agrees that, no more than twice per calendar year, and no less than thirty (30)
days after receipt of written notice, it shall cooperate with audits by Lender
Participant or Program Administrator 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 Program Administrator or Lender
Participant with respect to each Milestone (“Remedial Action Plan”). Upon
completion of the Remedial Action Plan, Program Administrator or Lender
Participant may, at a time mutually agreeable to the Parties, perform an
additional audit to validate successful completion of the Remedial Action Plan.

 

4.03        System
Changes.  The
Servicer has the right to change any part or all of its equipment, the PHEAA
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 in full compliance with all applicable federal and state laws
and regulations, the terms and conditions of the Credit Agreements, the
Servicing Guidelines, or the terms of this Agreement.

 

(b)           The Parties agree that they
shall make reasonable efforts to provide information about the nature and
effect of changes that the Parties reasonably believe may affect the operations
or processes of the other(s) and shall determine the extent to which the
other Parties need to be involved in the testing of changes to its own
system.  The parties shall 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)           Collaborative Efforts for Refinements
and Enhancements and Statements of Work

 

(i)            Servicer and FMC will meet,
not less than quarterly, for the purpose of discussing future enhancements to
the functions performed by Servicer consistent with the Program Guidelines.

 

(ii)           For any enhancement,
modification, or change to the PHEAA System or to the procedures necessary for
the Servicer to fulfill their obligations under this Agreement, a Statement of
Work will be negotiated and executed to outline the requirements, expectations
and fees.

 

4.04        System Access.   Servicer shall, upon the agreement
of each Lender Participant, provide FMC as Program Administrator and FMER as
agent for Program Administrator with web-based access to Student Loan 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 PHEAA
System.  Servicer shall at all times
maintain the security of user access to the PHEAA 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 and other users no less frequently than every six months.

 

4.05        System Parameters.  The Servicer is responsible for designing,
implementing and maintaining the PHEAA System in order to remain in compliance
with the requirements of this Agreement.

 

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

 

5

 

SECTION 5. 
CHARGES AND PAYMENTS

 

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

 

5.02        Rate Changes Other than
Annual Adjustments.  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,
this Agreement, or any Lender Participant Servicing 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 this Agreement or
any Lender Participant Servicing Agreement, (c) changes in United States
Postal Service postage rates, or (d) material changes requested by a
Lender Participant or Program Administrator in the Services provided herein,
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 Program
Administrator and affected Lender Participants sixty (60) days prior written
notice before implementing any such increase in Servicing fees pursuant to this
Section. Such notice shall set forth the basis of, as well as the computation
used in determining, any increase.

 

5.03        Invoices.  Servicer agrees that invoices for its
Services shall be rendered to FMC, based on the Services provided pursuant to
each of the Lender Participant Servicing Agreements.  All invoices shall be sent to FMC as Program
Administrator. FMC shall, as Program Administrator, forward to each Lender
Participant an invoice for the Services of the Servicer and its services as the
Program Administrator, and shall provide a copy of such invoice to Servicer.
Under the terms of the Lender Participant Servicing Agreement, the Lender
Participant shall remit payment to Servicer for the Services and the services
of the Program Administrator. Servicer shall hold in trust for Program
Administrator and, within ten (10) Business Days after receipt from Lender
Participant, forward to Program Administrator the balance of the fees which
were remitted by Lender Participant to Servicer which are in excess of the
invoiced amounts for each Lender Participant. Any disputes that arise related
to the payments remitted by the Lender Participants and/or the invoices
rendered by FMC to each Lender Participant, in addition to reconciliation of
payments and invoices, shall be resolved by FMC. In the event that the Servicer’s
fees in the monthly invoice exceed the monthly fees to be paid to the Servicer
in the Lender Participant Servicing Agreement (“Excess Monthly Charges”), FMC
shall pay the Excess Monthly Charges to the Servicer on or before the invoice
payment date, and FMC shall be responsible for recoupment of the payment of
Excess Monthly Charges from the Lender Participant.

 

5.04        Adjustments
to Programs. Servicer and Program
Administrator, on behalf of the Lender Participants, shall discuss future
enhancements to the Services, the PHEAA System, and the Servicing Guidelines as
identified in Section 4.03(c).

 

5.05        Annual
Adjustment of Fees.  On or before the end of the ninth month after
the Effective Date of this Agreement, and annually thereafter, Servicer may
propose new fees to be effective upon the anniversary of the Effective Date.
 Servicer shall provide documentation to FMC to justify any increase in
fees.  The increased fee can be based on additional costs documented by
Servicer to service the loans and/or equal to the percentage increase in the U.
S. Department of Labor’s Consumer Price Index for Urban Wage Earners and
Clerical Workers, U. S. City Average (CPI/W) for the most recent twelve (12)
month period available at the time of each proposed adjustment.  Such
increase shall be effective upon the anniversary of the Effective Date.  Consent
to increases to fees based on the documented costs of the Servicer will not be
unreasonably withheld.  Any annual adjustment of fees shall be agreed upon
mutually by both parties.

 

5.06        Audit Follow-Up. In the event
that any financial audit conducted pursuant to any Lender Participant Servicing
Agreement reveals that any charges or expenses have been overbilled or
underbilled, then adjustments in fees and invoices shall be made as necessary
on a prospective basis in future months to correct errors or maintain compliance
with the Fee Schedule, this Agreement, or the Lender Participant Servicing
Agreement, or Servicer or FMC shall render a payment to the other party as
necessary to correct the discrepancy.

 

6

 

SECTION 6.  LIABILITY

 

Servicer
agrees to pay FMC for any claim, loss, liability or expense, including
reasonable attorney’s fees (collectively referred to herein as “Loss”), which
arises out of or relates to the Servicer’s acts or omissions with respect to
the Services provided to Program Administrator under this Agreement, where the
final determination of liability on the part of the Servicer to Program
Administrator is established by the Commonwealth’s Board of Claims, a court of
law with competent jurisdiction over the Servicer or by way of settlement
agreed to by the Servicer. Further, 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 Servicer respecting any matter pertaining to this Agreement or
any part thereof may be instituted in the Board of Claims.

 

Program
Administrator agrees to pay Servicer for any Loss arising out of or relating to
Program Administrator’s acts or omissions with respect to the Student Loans
covered by this Agreement, where the final determination of liability on the
part of Program Administrator is established by a court of law or by way of
settlement agreed to by Program Administrator.

 

This
provision shall not be construed to limit the Servicer’s or Program
Administrator’s rights, obligations, liabilities, claims or defenses which
arise as a matter of law or pursuant to any other provision of this Agreement.

 

SECTION 7.
ASSIGNMENT

 

This Agreement and all the
rights and obligations of any Party hereunder may not, without the prior
written consent of the other Parties, which consent shall not be unreasonably
withheld, be assigned or subcontracted by any Party.  Any successor must acquire substantially all
of the assets or business of a Party, and have the ability to perform the
duties and obligations under the terms and conditions hereof.

 

SECTION 8.         TERMINATION

 

8.01        Termination
by Owner/FMC.  This
Agreement may be terminated at the option of Program Administrator upon the
occurrence of any of the following:

 

(a)           The Servicer’s failure to
perform or observe any of the provisions or covenants of this Agreement and its
referenced schedules, in any material respect;

 

(b)           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;

 

(c)           If Servicer is the subject
of a Change of Control, Program Administrator shall have the right to terminate
this Agreement upon a minimum of thirty (30) 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.

 

In the event of an event of
default as set forth in Section 8.01(a) above, the Servicer shall
have the right to cure any such breach or error to Program Administrator’s full
satisfaction within thirty (30) days of written notice from Program
Administrator.

 

7

 

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

 

(a)           Program
Administrator’s failure to perform or observe any of the provisions or
covenants of this Agreement and its referenced schedules, in any material
respect; or

 

(b)           If Program
Administrator 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 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.

 

In the event of an event of
default as set forth in Section 8.02(a), Program Administrator 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.

 

8.03        Effect of Termination.  With
respect to FMC Administrator Loans, without the taking of any action by
Servicer or Lender Participants, this Agreement confers the rights and remedies
of FMC as Program Administrator upon each Lender Participant in the event that
the loan program agreement between FMC and the Lender Participant governing FMC’s
role as Program Administrator is terminated.

 

SECTION 9.  MISCELLANEOUS PROVISIONS

 

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

 

	
  If to FMC:

  	
  General Counsel

  
	
   

  	
  The First Marblehead
  Corporation

  
	
   

  	
  The Prudential Tower

  
	
   

  	
  800 Boylston Street, 34th Floor

  
	
   

  	
  Boston, Massachusetts
  02199-8157

  
	
   

  	
   

  
	
  If to Servicer:

  	
  General Counsel

  
	
   

  	
  Pennsylvania Higher
  Education Assistance Agency

  
	
   

  	
  1200 North Seventh Street

  
	
   

  	
  Harrisburg, Pennsylvania
  17102

  

 

9.02        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.

 

9.03        Non-Exclusive Agreement.  Nothing contained herein shall be construed
to create an exclusive arrangement as to Servicer or FMC. The parties
understand and agree that they each may enter into other agreements in
connection with the servicing of Private Student Loans in the future.

 

9.04        Survival.  The obligations and duties of each Party
under Section 6 (Liability) shall survive the termination or expiration of
this Agreement.

 

9.05        Entire
Understanding.  This
Agreement, including without limitation all Schedules attached hereto, along
with the Lender Participant Servicing Agreements, represent the entire
understanding of the parties with respect to the subject matter hereof, 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 any Party to the other,
except as expressly set forth herein or in such other agreements.

 

9.06        Interpretation of Documents.  In the event of a conflict between this
Private Student Loan Program Agreement and a Schedule attached hereto, this
Agreement shall control.

 

8

 

9.07        Cooperation.    FMC
and the Servicer agree that they will cooperate fully with one another in order
to carry out the terms and provisions of the Agreement during the term of this
Agreement.  Cooperation under this Section shall
include, but not be limited to, each Party using reasonable means to ensure
successful, normal, daily processing of 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.

 

9.08        Authorization. Each of the
undersigned represents that he or she has the authority to execute this
Agreement on behalf of the respective Party.

 

9.09        Amendments; Changes;
Modifications.  This
Agreement (a) may be amended, supplemented, or modified only by written
instrument duly executed by the Parties; (b) such written instrument 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.

 

9.10        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.

 

9.11        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.

 

9.12        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.

 

9.13        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.

 

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/
  James L. Preston

  	
   

  	
             /s/
  Stein Skaane

  
	
  Name: James L.
  Preston

  	
   

  	
  Name: Stein Skaane

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title: President and
  CEO

  	
   

  	
  Title: Managing Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Approved as to form and
  legality

  	
   

  	
  Approved as to form and legality

  

 

9

 

	
             /s/
  Jason Swartley

  	
   

  	
             /s/
  Robert A. Mulle

  
	
  PHEAA General Counsel

  	
   

  	
  Deputy Attorney General

  

 

10

 

 

INDEX TO SCHEDULES

 

Fee Schedule

 

System Access Schedule

 

Customer Service Schedule

 

Service Level Schedule

 

11

 

FEE
SCHEDULE FOR

PRIVATE
STUDENT LOAN MONOGRAM PROGRAM AGREEMENT

DATED
FEBRUARY 5, 2009

BETWEEN

PENNSYLVANIA
HIGHER EDUCATION ASSISTANCE AGENCY,

AND

THE
FIRST MARBLEHEAD CORPORATION (“AGREEMENT”)

 

The fee for the Services
provided by Servicer, together with services provided by FMC as Program
Administrator, shall be payable to Servicer by the Lender Participants as set
forth in this Fee Schedule and Section 5 of the Agreement.

 

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.

 

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

 

12

 

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 $[**]. If the ending principal balance
of the Student Loans (including Student Loans in Interim Account status and
Repayment Account status) at month end is [**] dollars ($[**]) or more, but
less than or equal to [**] dollars ($[**]), 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 > $[**]. If the ending principal
balance of the Student Loans (including Student Loans in Interim Account status
and Repayment Account status) at month end is greater than [**] dollars
($[**]), 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) Loans in Repayment over 120 Months. Notwithstanding
subsections (a), (b), and (c) above, the Servicing fee for loans in
Repayment Account status shall be [**] basis points for all Student Loans that
have been Serviced by Servicer for over 120 months that are not thirty (30) or
more days delinquent.

 

(e) Delinquent Accounts. Notwithstanding subsections (a), (b),
(c), and (d) above, the 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 outsourced for collections, and for
Student Loans outsourced for collections as of the end of the month, 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 outsourced for collections divided by [**])

 

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:

  	
  [**]

  

 

	
  3.             Repayment Account:

  	
  Quote

  

 

13

 

	
  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

 

4.             Claim
Processing:                 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

  

 

14

 

	
  6.             Mailings

  	
   

  

 

	 
	
  a.

  	
  GLB privacy notices

  	
  $[**] per notice

  
	 
	
  b.

  	
  IRS Forms 1098/1099

  	
  $[**] 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

  
				

 

VII.         ANNUAL ADJUSTMENT OF FEES

 

On
or before the end of the ninth month after the Effective Date of this
Agreement, and annually thereafter, Servicer may propose new fees to be
effective upon the anniversary of the Effective Date.  Servicer shall
provide documentation to FMC to justify any increase in fees.  The
increased fee can be based on additional costs documented by Servicer to
service the loans and/or equal to the percentage increase in the U. S.
Department of Labor’s Consumer Price Index for Urban Wage Earners and Clerical
Workers, U. S. City Average (CPI/W) for the most recent twelve (12) month
period available at the time of each proposed adjustment.  Such increase
shall be effective upon the anniversary of the Effective Date.  Consent to
increases to fees based on the documented costs of the Servicer will not be
unreasonably withheld.  Any annual adjustment of fees shall be agreed upon
mutually by both parties.

 

15

 

PRIVATE
STUDENT LOAN MONOGRAM PROGRAM AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE  AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

 

SYSTEM ACCESS SCHEDULE

 

All
system access shall be limited to view only option.

 

1.
Lender Participant and Program Administrator.

 

Servicer shall provide
Program Administrator, upon approval by the Lender Participants, 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 users shall
obtain remote access within five (5) Business Days of receipt of notice
and additional necessary information from Program Administrator, as applicable
that such individual requires remote access.

 

2. FMC/FMDS/FMER/FMLOS USER
ACCESS SECURITY REQUIREMENTS

 

The Servicer Relations group
of Program Administrator will be responsible for notifying the Servicer to add
and delete Program Administrator and FMER employees who need, or no longer
need, access as appropriate.  On a quarterly
basis, Servicer will provide Program Administrator with a report of Program
Administrator and FMER employees who have system access to Borrower
information.  Program Administrator shall
be responsible for the accuracy of such reports and shall be liable for the
inaccuracy thereof in accordance with Section 6 (Liability) of this
Agreement.

 

16

 

PRIVATE
STUDENT LOAN MONOGRAM PROGRAM 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.

 

2. Customer Service Hours of
Operation

 

The Servicer shall maintain
minimum customer service hours of operation Monday through Friday.  The Servicer and the Program Administrator
shall agree on these minimum hours of operation.  Program Administrator, at the direction of a
Lender Participant, 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.  The Servicer and the Program Administrator
shall agree on these minimum hours of operation.  Program Administrator, at the direction of a
Lender Participant, 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.

 

4. Borrower Satisfaction
Surveys

 

The Servicer shall work with
Program Administrator 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 Program Administrator to resolve such issues.

 

5. Borrower
Correspondence/Complaints

 

All correspondence received by Servicer
relating to individual Borrower Accounts shall be maintained by the Servicer
and shall be made available to Program Administrator 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 Program
Administrator 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, if allowed, Service shall contact Program Administrator immediately.

 

17

 

PRIVATE
STUDENT LOAN MONOGRAM PROGRAM AGREEMENT

BETWEEN

PENNSYLVANIA HIGHER EDUCATION ASSISTANCE-AGENCY

AND

THE FIRST MARBLEHEAD CORPORATION

 

SERVICE LEVEL AGREEMENTS

 

Servicer agrees to adhere to
the Service Level Agreement (SLA) outlined below.

 

The Servicer will provide
Program Administrator 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 Program Administrator 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 

 

18

 

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 forbearances
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 Program Administrator within [**] Business Days of initial
notification.

 

IV.           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.

 

V.            Conversion

 

·      Servicer
shall convert all FMC Administrator 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 FMER.

 

19

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