Master Loan Sale Agreement

MASTER LOAN SALE AGREEMENT

UNITED STATES DEPARTMENT OF EDUCATION

JULY 25, 2008

ELIGIBLE LOANS MADE PURSUANT TO THE
FEDERAL FAMILY EDUCATION LOAN PROGRAM

TABLE OF CONTENTS
Page
Section 1.

Terms.........................................................................................................................1

Section 2.

Commitment to Lend Under the FFELP ...................................................................2

Section 3.

Definitions.................................................................................................................2

Section 4.

Sale/Purchase. ...........................................................................................................9

Section 5.

Conditions Precedent to Purchase. ..........................................................................11

Section 6.

Representations and Warranties of the Seller and the Eligible Lender Trustee......13

Section 7.

Rescission of Purchase; Obligation to Reimburse and Indemnify..........................18

Section 8.

Obligation to Remit Subsequent Payments and Forward Communications. ..........19

Section 9.

Continuing Obligation of the Seller ........................................................................19

Section 10.

Liability of the Seller; Indemnities..........................................................................19

Section 11.

Transfer of Servicing...............................................................................................20

Section 12.

Merger or Consolidation of, or Assumption of the Obligations of, the Seller........20

Section 13.

Expenses..................................................................................................................21

Section 14.

Survival of Covenants .............................................................................................21

Section 15.

Communication and Notice Requirements .............................................................21

Section 16.

Form of Instruments ................................................................................................22

Section 17.

Amendment; Waiver ...............................................................................................22

Section 18.

Audits ......................................................................................................................22

Section 19.

Severability Clause..................................................................................................22

Section 20.

Governing Law........................................................................................................22

Section 21.

Exhibits....................................................................................................................23

Section 22.

General Interpretive Principles................................................................................23

Section 23.

Reproduction of Documents....................................................................................23

Section 24.

Further Agreements.................................................................................................23

Section 25.

Other Department Program .....................................................................................24

Section 26.

Adoption..................................................................................................................24

Section 27.

Integration ...............................................................................................................24
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EXHIBITS
EXHIBIT A
EXHIBIT B
EXHIBIT C
EXHIBIT D
EXHIBIT E
EXHIBIT F

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FORM OF ADOPTION AGREEMENT
FORM OF BILL OF SALE
FORM OF SELLER’S OFFICER’S CERTIFICATE
FORM OF OPINION OF COUNSEL TO THE SELLER
FORM OF SECURITY RELEASE CERTIFICATION
FORM OF NOTICE OF INTENT TO PARTICIPATE

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MASTER LOAN SALE AGREEMENT
This is a Master Loan Sale Agreement, dated July 25, 2008 (“Master Loan Sale
Agreement”), among the United States Department of Education (“Department”) and an
individual Eligible Lender (as defined below) or the holder of beneficial interests in Loans (such
entity, “Seller”), and if the latter, the related Eligible Lender Trustee, in each case made party to
this Master Loan Sale Agreement by executing an Adoption Agreement in the form attached
hereto as Exhibit A.
WHEREAS, pursuant to Section 459A of the Higher Education Act of 1965, as amended
by the Ensuring Continued Access to Student Loans Act of 2008 (Pub. L. No. 110-227) (“Higher
Education Act”), the Department has the authority to purchase Stafford Loans and PLUS Loans,
on such terms as the Secretary of Education, the Secretary of the Treasury, and the Director of
the Office of Management and Budget jointly determine are in the best interest of the United
States to encourage Eligible Lenders to provide students and parents access to Stafford Loans
and PLUS Loans made under the Federal Family Education Loan Program for the 2008-2009
academic year;
WHEREAS, the Seller has an ownership interest in certain Stafford Loans and PLUS
Loans guaranteed under the Higher Education Act;
WHEREAS, the Seller may desire to sell its interest in such loans from time to time and
the Department may desire to purchase such loans from the Seller;
WHEREAS, to the extent that the Department, the Seller and the Eligible Lender Trustee
(if applicable) enter into an Adoption Agreement, this Master Loan Sale Agreement shall provide
for the Seller to sell to the Department certain of such loans by sale and transfer to the
Department of all of the Seller’s and the Eligible Lender Trustee’s (if applicable) right, title and
interest in, to and under such loans (including the right to service such loans) as authorized by
the Higher Education Act, all on the terms and conditions set forth below; and
WHEREAS, by its execution of an Adoption Agreement to this Master Loan Sale
Agreement, and upon each transfer hereunder, the Seller shall represent to the Department that it
shall continue to participate in the Federal Family Education Loan Program and that at such time
as funds become reasonably available to it from private sources, it will originate new FFELP
loans or acquire FFELP loans made by other lenders after the Department’s purchases of Loans
from the Seller.
NOW, THEREFORE, in connection with the mutual promises contained herein, the
parties hereto agree as follows:
Section 1.
Terms. This Master Loan Sale Agreement establishes the terms under
which the Seller, together with an Eligible Lender Trustee, if any, which holds legal title to
Eligible Loans on behalf of the Seller and which is authorized to sell Eligible Loans on behalf of
the Seller, may sell, and the Department shall purchase, the Eligible Loans (and all obligations of
the Borrowers thereunder) specified on each Loan Schedule attached to each Bill of Sale as the
parties may execute from time to time pursuant to this Master Loan Sale Agreement, subject to
the terms of this Master Loan Sale Agreement. Each such Bill of Sale shall be substantially in

the form of Exhibit B, attached hereto, incorporating by reference the terms of this Master Loan
Sale Agreement, and shall be a separate agreement among the Seller, the Eligible Lender Trustee
(if applicable) and the Department with respect to the Loans covered by the terms of such Bill of
Sale for all purposes. If the terms of a Bill of Sale conflict with the terms of this Master Loan
Sale Agreement, the terms of this Master Loan Sale Agreement shall supersede and govern
except to the extent that such conflict is specifically noted in the Bill of Sale and the parties
acknowledge and agree that notwithstanding such conflict, the terms of the Bill of Sale shall
govern.
In order to sell any Loans pursuant to this Master Loan Sale Agreement, the Seller must
notify the Department that it will sell such Loan(s) no later than August 14, 2009, and must
complete the sale on or before September 30, 2009. If an Eligible Lender fails to meet one or
both of these dates, the right to sell Loans hereunder shall terminate and the Department will not
honor any commitment to purchase loans.
No Loan will be eligible for sale hereunder to the Department if the first disbursement
was made prior to the date on which the Department received a completed Notice of Intent to
Participate from the Seller, except that, in the event that the Department receives such Notice of
Intent to Participate on or before July 31, 2008, such Eligible Lender shall be permitted to sell to
the Department Eligible Loans that were first disbursed on or after May 1, 2008.
If an Eligible Lender wishes to sell a Loan to the Department that it did not originate,
both the Eligible Lender and the originating Lender must each deliver a completed Notice of
Intent to Participate to the Department prior to the date on which it originated or acquired the
Loan, as the case may be. In addition, a Loan disbursed on or after May 1, 2008 will be eligible
for sale hereunder to the Department from the Eligible Lender that acquired such Loan, if the
Department receives the Notice of Intent to Participate from the originating Lender by July 31,
2008.
Section 2.
Commitment to Lend Under the FFELP. By its execution of an
Adoption Agreement, and upon each sale hereunder, the Seller represents to the
Department that it shall continue to participate in the FFELP (either itself or through an
Eligible Lender Trustee) and that at such time as funds become reasonably available to it
from private sources, it will originate new FFELP loans or acquire FFELP loans made by
other lenders after the date of the sale of the Loans to the Department hereunder.
Section 3.
Definitions. For purposes of this Master Loan Sale Agreement, the
following capitalized terms shall have the respective meanings set forth below:
A.
“Adoption Agreement” means an Adoption Agreement, substantially in the form
of Exhibit A, attached hereto, of which this Master Loan Sale Agreement forms a part by
reference, by and among the Department, a Seller and an Eligible Lender Trustee (if applicable)
obligating each of the parties thereto to the terms of this Master Loan Sale Agreement. If the
terms of an Adoption Agreement conflict with the terms of this Master Loan Sale Agreement, the
terms of this Master Loan Sale Agreement shall govern except to the extent that such conflict is
specifically noted in such Adoption Agreement and the parties acknowledge and agree that
notwithstanding such conflict, the terms of the Adoption Agreement shall govern.
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B.
“Bill of Sale” means each document in the form of Exhibit B, attached hereto,
executed by an authorized officer of the Seller and acknowledged by the Department, which
shall (i) set forth the Loans offered by the Seller and accepted for purchase by the Department,
(ii) sell, assign and convey to the Department and its assignees, all right, title and interest of the
Seller, in the Loans listed on that Bill of Sale and (iii) certify that the representations and
warranties made by the Seller pursuant to Sections 6A and 6B of this Master Loan Sale
Agreement are true and correct.
C.

“Borrower” means the student or parent obligor on a Loan.

D.
“Business Day” means any day other than (i) a Federal or applicable State
holiday, or (ii) a Saturday or Sunday.
E.
“Custodian” means the entity specified by the Department to whom the fully
executed Promissory Notes evidencing the Loans and other related Loan Documents must be
delivered in connection with any sale hereunder.
F.
“Eligible Borrower Benefits” means only those borrower benefits for a Loan that
are (i) unconditional upfront fee reductions which are accrued and paid or made prior to the date
on which a Loan is sold hereunder, or (ii) permitted reductions in interest rates of not more than
0.25 percent that are contingent on the use of an automatic payment process by the Borrower for
any payments due.
G.
“Eligible Lender” means an entity that is an eligible lender under Section 435(d)
of the Higher Education Act that holds Eligible Loans (whether directly or as an Eligible Lender
Trustee).
H.
“Eligible Lender Trustee” means an Eligible Lender that holds legal title to a
Loan for the benefit or on behalf of the Seller which holds the related beneficial ownership
interest in such Loan that is authorized to sell Eligible Loans on behalf of the Seller, and that
executes an Adoption Agreement together with such Seller.
I.
“Eligible Loan” means a Loan that meets the following criteria as of the
applicable Purchase Date:
(i)

the Loan was made for loan periods that include, or begin on or after,
July 1, 2008, the first disbursement on the Loan is made on or after May 1,
2008 but no later than July 1, 2009, and the Loan is fully disbursed no
later than September 30, 2009;

(ii)

the Loan is owned by the Seller, together with the Eligible Lender Trustee
(if applicable), and is fully disbursed;

(iii)

the Loan has been originated and serviced in compliance with all
requirements of applicable law, including the Higher Education Act and
the implementing regulations, the Equal Credit Opportunity Act,
Regulation B and other applicable consumer credit laws and equal credit
opportunity laws, as applicable to such Loan;
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(iv)

the Loan is guaranteed at least 97% as to principal and interest by the
applicable Guarantor and eligible for reinsurance by the Department in
accordance with the Higher Education Act;

(v)

the Loan bears interest at a stated rate equal to the maximum rate
permitted under the Higher Education Act for such loan;

(vi)

the Loan is eligible for the payment of quarterly Special Allowance
Payments;

(vii)

if the Loan is not yet in repayment status, the Loan is eligible for payment
of Interest Subsidy Payments, or if not eligible, has interest either billed
quarterly to the Borrower or capitalized to the extent permitted by the
applicable Guarantor;

(viii) the Loan is evidenced by a signed Promissory Note and any addendum
thereto or the electronic records evidencing the same, containing terms in
accordance with those required by the Higher Education Act, the
applicable Guarantee Agreement and other applicable requirements, and
which does not require the Borrower to consent to the transfer, sale or
assignment of the rights and duties of the Seller and does not contain any
provision that restricts the ability of the Department to exercise its rights
under this Agreement or any rights the Department may have under the
related documents;
(ix)

the Seller, together with the Eligible Lender Trustee (if applicable), has
good and marketable title to the Loan free and clear of any encumbrance,
lien or security interest or any other prior commitment other than as may
be granted in favor of the Department or that will be released pursuant to a
Security Release Certification upon the transfer hereunder;

(x)

the Loan has not been modified, extended or renegotiated in any way,
except as required under the Higher Education Act or other applicable
laws, rules and regulations, and the applicable Guarantee Agreement;

(xi)

the Loan constitutes a legal, valid and binding obligation to pay on the part
of the related Borrower enforceable in accordance with its terms and is not
subject to a current bankruptcy proceeding;

(xii)

the Loan is supported by the documents required under this Agreement;

(xiii) the Loan has no borrower benefits or other incentive programs other than
Eligible Borrower Benefits;
(xiv)

if the Loan is subject to a servicing agreement, such servicing agreement
is terminable with respect to such Loan upon thirty (30) days’ notice by
the Department without the payment by the Department of any de-4-

boarding, deconversion or related fees or expenses of the related servicer
and without any liability on the part of the Department;
(xv)

the sale or assignment of the Loan does not conflict with any law or
require notice to or consent, approval, authorization or order of any Person
or governmental authority, except for such consent, approval,
authorizations or orders, if any, that have been obtained prior to the related
Purchase Date, and for any notices to Borrowers and Guarantors required
by the Higher Education Act;

(xvi)

if the Loan is made under Section 428 (Subsidized Stafford Loans) or
Section 428H (Subsidized Stafford Loans) of the Higher Education Act,
such Loan shall have been sold to the Department together with all of the
Borrower’s other Subsidized Stafford Loans and Unsubsidized Stafford
Loans that are Eligible Loans and that are held by or on behalf of the
Seller; and

(xvii) the Loan has been originated or acquired by either an Eligible Lender, or a
lender that is not an Eligible Lender and the legal title of such Loan is held
by an Eligible Lender Trustee, and pursuant to Section 1 above, the
Department has timely received the Notices of Intent to Participate.
The following loans shall, without limitation, not be eligible for sale to the Department
pursuant to the terms of this Master Loan Sale Agreement:
(i)

loans which do not comply with the representations and warranties set
forth in Section 6B of this Master Loan Sale Agreement;

(ii)

FFELP consolidation loans or any other types of loans not specifically
described in this Master Loan Sale Agreement;

(iii)

loans disbursed for academic years other than 2008-2009;

(iv)

loans on which the lender has committed to providing the Borrower with
any borrower benefits other than Eligible Borrower Benefits;

(v)

loans on which a default claim or other claim for payment on the loan has
been filed with the related Guarantor; and

(vi)

loans made by a guarantor or other lender as a Lender of Last Resort,
pursuant to Section 428(j) of the Higher Education Act, whether made
with Federal advances or other funds.

J.
“Equal Credit Opportunity Act” means the Equal Credit Opportunity Act (15
U.S.C. Section 1691 et seq.) as amended.
K.
“FFELP” means the Federal Family Education Loan Program authorized under
title IV, Part B of the Higher Education Act.
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L.
“Guarantee Agreement” means an agreement between a Guarantor and the Seller
or the Eligible Lender Trustee (if applicable) that provides for the payment by such Guarantor of
amounts authorized to be paid pursuant to the Higher Education Act to holders of qualifying
FFELP student loans guaranteed in accordance with the Higher Education Act.
M.
“Guarantor” means any FFELP guaranty agency with which the Seller or the
Eligible Lender Trustee (if applicable) has in place a Guarantee Agreement, and which guarantor
is reinsured by the Department of Education for a percentage of claims paid for a given federal
fiscal year.
N.
“Higher Education Act” means the Higher Education Act of 1965, as amended, 20
U.S.C. Section 1001 et seq.
O.
“Interest Subsidy Payments” means the interest subsidy payments on certain
FFELP student loans authorized to be made by the Department pursuant to Section 428 of the
Higher Education Act.
P.
“Loan” means a FFELP Subsidized Stafford Loan or Unsubsidized Stafford Loan
or FFELP PLUS Loan that was made to a student or in the case of a parent PLUS loan, made to a
parent of a dependent student, evidenced by a Promissory Note and all related Loan Documents
together with any guaranties and other rights relating thereto including, without limitation,
Interest Subsidy Payments and Special Allowance Payments, together with the servicing rights
related thereto.
Q.

“Loan Documents” means with respect to each Loan, the following documents:
(i)

a copy of the loan application if a separate application was provided to the
Seller;

(ii)

a copy of the signed Promissory Note;

(iii)

the repayment schedule;

(iv)

a record of each disbursement;

(v)

notices of changes in a Borrower’s address and status as at least a halftime student;

(vi)

evidence of the Borrower’s eligibility for a deferment;

(vii)

the documents required for the exercise of forbearance;

(viii) documentation of the assignment of the loan, if any;
(ix)

a payment history showing the date and amount of each payment received
from or on behalf of the Borrower, and the amount of each payment that
was attributed to principal, interest, late charges, and other costs;

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(x)

a collection history showing the date and subject of each communication
between the Seller and the Borrower or endorser relating to collection of a
delinquent Loan, each communication other than regular reports by the
Seller showing that an account is current, between the Seller and a credit
bureau regarding the loan, each effort to locate a Borrower whose address
is unknown at any time, and each request by the Seller for default aversion
assistance on the Loan;

(xi)

documentation of any master promissory note confirmation process or
processes;

(xii)

any additional records that are necessary to document the validity of a
claim against the guarantee or the accuracy of reports submitted by the
Seller; and

(xiii) a statement identifying the name and location of the entity in possession of
the original electronic promissory note and, if different, the name,
company, address and contact information of the person who is able to
provide the affidavit or certification described in 34 C.F.R.
Section 682.414(a)(6)(i),
including
any
necessary
supporting
documentation.
R.
“Loan Schedule” means the schedule attached to each Bill of Sale (in the form
provided by the Department) and completed by or on behalf of the Seller and the Eligible Lender
Trustee (if applicable) that lists, by Borrower, (i) the Loans sold to the Department pursuant to
such Bill of Sale, (ii) the name and address of such Borrower, the loan number, the qualifying
institution attended by the Borrower, and the outstanding Principal Balance and accrued interest
of such Loans as of the related Purchase Date, and (iii) any other information the Department
may require including but not limited to certain identification numbers and dates relating to the
Eligible Loans.
S.
“Master Loan Sale Agreement” means this Master Loan Sale Agreement, of
which the Adoption Agreement forms a part by reference.
T.
“Master Participation Agreement” means the Master Participation Agreement,
dated July 25, 2008, together with the related adoption agreement among the Department, the
Seller, the Eligible Lender Trustee (if applicable) and the related Custodian.
U.
“Notice of Intent to Participate” means the notice provided to the Department by
an Eligible Lender or a lender other than an Eligible Lender, together with an Eligible Lender
Trustee (if applicable), of its intent to become a Seller hereunder, which shall be in the form
attached hereto as Exhibit F.
V.
“Person” means an individual, corporation, limited liability company, partnership,
joint venture, association, joint-stock company, trust, unincorporated organization or government
or any agency or political subdivision thereof.

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W.
“PLUS Loan” means a Loan described in Section 428B of the Higher Education
Act and shall include loans to parents, designated as “PLUS Loans” or loans to graduate or
professional students, designated “Grad PLUS Loans.”
X.
“Principal Balance” means the outstanding principal amount of the Loan, plus
interest capitalized through the Purchase Date (if any).
Y.
“Promissory Note” means the master promissory note of the Borrower and any
amendment thereto evidencing the Borrower’s obligation with regard to a student loan
guaranteed under the Higher Education Act or the electronic records evidencing the same and
that contains the terms required by the Higher Education Act and implementing regulations.
Z.
“Purchase Date” means with respect to any purchase, the date of the related Bill
of Sale on which the related Loans are sold to the Department and legal title to such Loans is
conveyed to the Department. The latest Purchase Date hereunder shall be September 30, 2009.
AA. “Purchase Price” means with respect to each Loan sold to the Department
hereunder, (1) the outstanding Principal Balance of the Loan as of the related Purchase Date,
plus (2) accrued and unpaid interest on the Loan as of the related Purchase Date, plus (3) a
reimbursement of the one percent (1%) loan fee (as provided by Section 438(d) of the Higher
Education Act) previously paid by the Seller to the Department, plus (4) $75.00 for such Loan.
BB. “Regulation B” means the federal regulations governing the Equal Credit
Opportunity Act as it appears in Title 12, Code of Federal Regulations, Part 202.
CC. “Responsible Officer” means any director, vice president, assistant vice president,
any associate or any other officer of the Sponsor, customarily performing functions similar to
those performed by any of the above designated officers and with respect to a particular matter,
to whom such matter is referred because of such officer’s knowledge of and familiarity with the
particular subject and having direct responsibility for the administration of this Agreement.
DD. “Secretary” means the Secretary of Education, and “Department” means the
United States Department of Education, and either term includes any official of the Department
duly authorized to perform any function with respect to the transactions under this Master Loan
Sale Agreement.
EE.
“Security Release Certification” means the certification executed by the Seller
and a lienholder with respect to one or more Loans substantially in the form of Exhibit E hereto.
FF.

“Seller” has the meaning set forth in the preamble hereof.

GG. “Special Allowance Payments” means special allowance payments on FFELP
student loans authorized to be made by the Department pursuant to Section 438 of the Higher
Education Act.
HH.

“Stafford Loan” means a Subsidized Stafford Loan or an Unsubsidized Stafford

Loan.
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II.
“Subsidized Stafford Loan” means a Loan described in Section 428(a) of the
Higher Education Act.
JJ.
“Unsubsidized Stafford Loan” means a Loan described in Section 428H of the
Higher Education Act.
Section 4.

Sale/Purchase.

A.
Notice. The Seller shall notify the Department of its intent to sell Loans pursuant
to this Master Loan Sale Agreement at least forty-five (45) calendar days prior to the related
Purchase Date and shall deliver a Loan Schedule for the Loans to be sold on a particular
Purchase Date to the Department together with such notice.
B.
Consummation of Sale and Purchase. The sale and purchase of Loans pursuant to
a Bill of Sale as of any Purchase Date shall be consummated upon (i) the Department’s receipt
from the Seller and the Eligible Lender Trustee (if applicable) of the related Bill of Sale together
with a Loan Schedule attached thereto, (ii) the delivery of the related Promissory Notes and
related Loan Documents to the Custodian, (iii) the payment by the Department to the Seller of
the Purchase Price, and (iv) the satisfaction of all other conditions precedent set forth in
Section 5B hereof in the manner set forth in this Agreement (or if unsatisfied, the Department
has permitted such unsatisfied conditions to be cured within an acceptable period of time
following the Purchase Date, in the Department’s sole discretion). The Department and the
Seller acknowledge and agree that the Purchase Price paid for each Loan includes consideration
for release by the Seller of any claim it may otherwise have with respect to related servicing
rights appurtenant to such Loan. Upon consummation, such sale and purchase shall be effective
as of the date of the Bill of Sale. The Seller shall use its best efforts to perform promptly its
obligations pursuant to such Bill of Sale with respect to each Loan.
Notwithstanding anything herein to the contrary, a lender providing interim financing to
the Seller for Loans prior to the sale to the Department hereunder shall have the right to enforce
the Seller’s obligations to sell Loans to the Department on the Purchase Date and perform
pursuant to the Bill of Sale, if (i) such lender presents to the Department a power of attorney that
is duly executed by the Seller and the Eligible Lender Trustee (if applicable and to the extent
necessary) and is enforceable in each applicable jurisdiction, (ii) the Loans are Eligible Loans
(except that a Loan need not be fully disbursed in order to satisfy this clause (ii)) and (iii) such
lender makes all of the representations and warranties with respect to the Loans as are set forth in
Section 6B hereof. For the avoidance of doubt, except as provided in clause (iii) of the previous
sentence, such lender, in exercising its rights under this Section 4B, shall not be obligated to
perform any of the obligations of the Seller or the Eligible Lender Trustee (if applicable)
hereunder, including any obligation to file a Notice of Intent to Participate with the Department,
or to make any further disbursements with respect to any Loan sold to the Department by such
lender.
C.
Settlement of the Purchase Price. On the Purchase Date, the Department shall pay
to the Seller the Purchase Price by electronic transfer in funds available by the next Business Day
to the account specified by the Seller. Simultaneously with the payment to the Seller of the
Purchase Price, (i) the Seller shall deliver to the Department a duly executed Bill of Sale with
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respect to the related Loans being sold on such Purchase Date in the form attached hereto as
Exhibit B, (ii) either (x) if the Seller is an Eligible Lender, the Seller does hereby sell, transfer,
assign, set over and convey to the Department, without recourse, but subject to the terms of the
Agreement, all rights, title and interest of the Seller in and to the Loans listed on the Loan
Schedule delivered in connection with the related Purchase Date, or (y) if the Seller is not an
Eligible Lender, the Eligible Lender Trustee does hereby sell, transfer, assign, set over and
convey to the Department, without recourse, but subject to the terms of the Agreement, all of its
rights, title and interest in and to the related Eligible Loans, and the Seller does hereby sell,
transfer, assign, set over and convey to the Department, without recourse, but subject to the
terms of the Agreement, all of its beneficial interests in such Eligible Loans, and (iii) the Seller
does hereby sell, transfer, assign, set over and convey to the Department all of the related
servicing files and servicing rights appurtenant to the related Loans, the related Promissory Notes
and related Loan Documents (including, without limitation, any rights of the Seller to receive
from any third party any documents which constitute a part of the loan or servicing files) and all
rights and obligations arising under the documents contained therein.
D.
Purchase Frequency. The Seller may not sell Loans to the Department more
frequently than weekly.
E.
Interest Subsidy and Special Allowance Payments and Fees. The Seller shall be
entitled to all Interest Subsidy Payments and Special Allowance Payments on the Loans up to but
not including the related Purchase Date, and shall be responsible for the payment of fees, if any,
applicable to Loans accruing up to but not including the related Purchase Date. The Department
shall be entitled to all payments on a Loan which are received after the Purchase Date.
F.
Transfer of Servicing. The Seller shall cause each related servicer of the Loans to
transfer servicing in accordance with the directions of the Department and in accordance with
industry standards related to the prudent servicing of FFELP loans.
G.
Intent of the Parties. With respect to each sale of Loans pursuant to this Master
Loan Sale Agreement and the related Bills of Sale, it is the express intention of the Seller and the
Department, and the Seller hereby warrants that, the transfer and assignment constitute a valid
sale of such Loans and the rights to service such Loans from the Seller to the Department, and
that the legal and beneficial interest in and title to such Loans shall not be part of the Seller’s
estate in the event of the bankruptcy of the Seller or the appointment of a receiver with respect to
the Seller. If such transfer and assignment is deemed to be a pledge to secure a loan and not a
sale, then the parties also intend and agree that the Seller shall be deemed to have granted, and in
such event does hereby grant, to the Department, a first priority security interest in all of its right,
title and interest in, to and under such Loans, including the servicing rights appurtenant thereto,
all payments of principal or interest on such Loans due after the related Purchase Date, all other
payments made in respect of such Loans after the related Purchase Date and all proceeds thereof
and that this Master Loan Sale Agreement shall constitute a security agreement under applicable
law. If such transfer and assignment is deemed to be a pledge to secure a loan and not a sale, the
Seller consents to the Department hypothecating and transferring such security interest in favor
of Department’s successors or assigns.

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Section 5.

Conditions Precedent to Purchase.

A.
Initial Document Delivery. Not less than twenty (20) Business Days prior to the
first Purchase Date hereunder, the Seller shall submit to the Department fully executed originals
of the following documents:
(i)

an Adoption Agreement, in substantially the form of Exhibit A hereto,
duly executed by the Seller and the Eligible Lender Trustee (if applicable),
in three counterparts;

(ii)

an officer’s certificate, in substantially the form of Exhibit C hereto,
including all attachments thereto;

(iii)

an opinion of counsel to the Seller, in substantially the form of Exhibit D
hereto; and

(iv)

such other documents as the Department may request.

B.
Purchase Date Closing Conditions. Any purchase of Loans pursuant to this
Master Loan Sale Agreement on any Purchase Date is subject to the following conditions
precedent being satisfied (and the Seller, by accepting payment, shall be deemed to have certified
that all such conditions are satisfied on such Purchase Date):
(i)

Activities Prior to the Related Purchase Date. The Seller shall have
provided any assistance requested by the Department in determining that
all required documentation on the related Loans is present and correct.

(ii)

Servicing Released. Each Loan subject to a servicing agreement shall
have been released from such servicing agreement upon the sale to the
Department hereunder. The Seller shall be responsible for, and shall have
paid, any de-boarding, deconversion or related fees or expenses to the
related servicer. The Department shall obtain all rights to service such
Loan and may, in its sole discretion require deconversion of such Loan in
order to service the loan itself or through a third-party servicer of its
designation.

(iii)

Bill of Sale/Loan Schedule/Loan Documents. The Seller shall deliver to
the Department:
(1)

A Bill of Sale that has been duly authorized and executed by an
authorized officer of the Seller and the Eligible Lender Trustee (if
applicable), covering the applicable Loans offered by the Seller
and acknowledged and accepted by the Department as set forth
thereon;

(2)

The Loan Schedule attached to the Bill of Sale identifying each of
the Eligible Loans proposed to be sold; and
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(3)

The Loan Documents for each Loan listed on the Loan Schedule.

(iv)

Endorsement. At the direction of and in such form as the Department may
designate, the Seller also agrees to individually endorse any Loan as the
Department may request from time to time.

(v)

Eligible Lender Trustee Sales. The Eligible Lender Trustee (if applicable)
shall have delivered to the Department such additional documents and
information as the Department shall have requested to evidence that the
Eligible Lender Trustee is fully authorized to sell each related Loan on
behalf of the Seller.

(vi)

Security Release Certification. If any of the Loans has at any time been
subject to any security interest, pledge or hypothecation for the benefit of
any Person, the Seller shall deliver to the Department a Security Release
Certification, in the form of Exhibit E attached hereto executed by such
Person.

(vii)

Additional Documents. The Seller shall have delivered to the Department
such additional documents and information as the Department shall have
requested.

(viii) Additional Notices of Loan Transfer. The Seller shall deliver to the
Borrower such notices of loan transfer as may be required by the Higher
Education Act and implementing regulations. The Seller agrees that the
Department may use the related Bill of Sale, together with the related,
attached Loan Schedule, as official notification to the Guarantor of the
assignment by the Seller and the Eligible Lender Trustee (if applicable) on
behalf of the Seller to the Department of the Loans listed on such Loan
Schedule.
(ix)

Independent Public Accountant Review. Upon the consummation of the
initial purchase of Loans hereunder, and on any subsequent dates specified
by the Department (but not more often than monthly), the Seller shall
deliver an agreed upon procedures letter by an independent public
accountant with respect to the Loans proposed to be sold on such Purchase
Date, in form acceptable to the Department.

C.
Power of Attorney. The Seller hereby grants to the Department an irrevocable
power of attorney, which power of attorney is coupled with an interest, (i) to individually
endorse or cause to be individually endorsed in the name of the Seller any Loan, (ii) to evidence
the transfer of such Loan to the Department, (iii) to cause to be transferred physical possession
from the Seller to the Department or any Custodian on its behalf of any Promissory Note
evidencing a Loan sold to the Department hereunder, and (iv) to perform all other acts which the
Department deems appropriate to protect, preserve and realize upon the Loans sold hereunder,
including, but not limited to, the right to take possession of and endorse and collect any checks,
drafts, notes, acceptances or other instruments for the payment of moneys due with respect to
- 12 -

any Promissory Note, complete blanks in documents, transfer servicing and execute assignments
and other instruments on behalf of the Seller as its attorney in fact.
Section 6.
Trustee.

Representations and Warranties of the Seller and the Eligible Lender

A.
Representations as to the Seller and the Eligible Lender Trustee. The Seller, and
to the extent expressly required below, the Eligible Lender Trustee, represents and warrants to
the Department, as of the date the Adoption Agreement is executed and as of the date of each
Bill of Sale that:
(i)

Each of the Seller and the Eligible Lender Trustee (if applicable) (1) is
duly organized, validly existing and in good standing under the laws of the
State of its formation or of the United States, as applicable, (2) has all
licenses necessary to carry out its business as now being conducted or is
otherwise exempt under applicable law from such licensing or
qualification or is otherwise not required under applicable law to effect
such licensing or qualification and no demand for such licensing or
qualification has been made upon it by any such state, and (3) in any event
is in compliance with the laws of any such state to the extent necessary to
ensure the enforceability of each Loan. No licenses or approvals obtained
by it have been suspended or revoked by any court, administrative agency,
arbitrator or governmental body and no proceedings are pending which
might result in such suspension or revocation;

(ii)

The Seller or the Eligible Lender Trustee (if applicable) is an “eligible
lender” as such term is defined in Section 435(d) of the Higher Education
Act, has a lender identification number issued by the Department with
respect to the Loans, and has in effect a Guarantee Agreement with a
Guarantor with respect to each of the Loans;

(iii)

With respect to each state or jurisdiction therein in which the Seller
undertakes origination activities, Seller is in full compliance with such
state’s or jurisdiction’s (as applicable) laws, rules, regulations, orders,
settlement agreements and other standards and procedures, including those
promulgated by agencies or officers thereof, applicable to it and pertaining
to the conduct of participants in the student loan industry (including,
without limitation, any applicable “code of conduct” for participants in the
student loan industry);

(iv)

The Seller has administered, operated and maintained its FFEL program in
such manner as to ensure that such program and the Loans will benefit, in
all material respects, from the FFELP, the Guarantee Agreements related
thereto and the federal program of reimbursement for FFELP loans
pursuant to the Higher Education Act;

- 13 -

(v)

The Seller has not, with respect to any Loan sold under any Bill of Sale
executed pursuant to this Master Loan Sale Agreement, agreed to release
any Guarantor from any of its contractual obligations as a guarantor of
such Loan or agreed otherwise to alter, amend or renegotiate any material
term or condition under which such Loan is guaranteed, except as required
by law or rules and regulations issued pursuant to law, without the express
prior written consent of the Department;

(vi)

Each of the Seller and the Eligible Lender Trustee (if applicable) (1) has
all requisite power and authority to hold each Loan, to sell each Loan, and
to execute, deliver and perform, and to enter into and consummate, all
transactions contemplated by this Master Loan Sale Agreement, (2) has
duly authorized the execution, delivery and performance of this Master
Loan Sale Agreement and (3) has duly executed and delivered this Master
Loan Sale Agreement. This Master Loan Sale Agreement, assuming due
authorization, execution and delivery by the other parties hereto,
constitutes the legal, valid and binding obligation of the Seller and the
Eligible Lender Trustee (if applicable), enforceable against each of them
in accordance with its terms except as the enforceability thereof may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar
laws affecting the enforcement of rights of creditors generally, and to
general principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or law); provided, however, that if the
Seller is not an Eligible Lender, the power and authority to hold and sell
each Loan described in clause (1) shall refer, with respect to the Seller, to
the beneficial interest of the Seller, and with respect to the Eligible Lender
Trustee, to its interest as the legal title holder of the Loan;

(vii)

The execution and delivery of this Master Loan Sale Agreement by each
of the Seller and the Eligible Lender Trustee (if applicable) and the
performance of and compliance with the terms of this Master Loan Sale
Agreement will not violate its formation documents or constitute a default
under or result in a breach or acceleration of, any material contract,
agreement or other instrument to which it is a party or which may be
applicable to it or its assets;

(viii) Neither the Seller nor the Eligible Lender Trustee (if applicable) is in
violation of, and the execution and delivery of this Master Loan Sale
Agreement by it and its performance and compliance with the terms of this
Master Loan Sale Agreement will not constitute a violation with respect
to, any order or decree of any court or any order or regulation of any
federal, state, municipal or governmental agency having jurisdiction over
it or its assets, which violation might have consequences that would
materially and adversely affect the condition (financial or otherwise) or its
operations or its assets or might have consequences that would materially
and adversely affect the performance of its obligations and duties
hereunder;
- 14 -

(ix)

The Seller does not believe, nor does it have any reason or cause to
believe, that it cannot perform each and every covenant contained in this
Master Loan Sale Agreement;

(x)

There are no actions or proceedings against, or investigations of, the Seller
before any court, administrative agency or other tribunal (A) that might
prohibit its entering into this Master Loan Sale Agreement, (B) that seeks
to prevent the sale of the Loans or the consummation of the transactions
contemplated by this Master Loan Sale Agreement or (C) that might
prohibit or materially and adversely affect the performance by the Seller
of its obligations under, or the validity or enforceability of, this Master
Loan Sale Agreement;

(xi)

No consent, approval, authorization or order of any court or governmental
agency or body is required for the execution, delivery and performance by
the Seller or the Eligible Lender Trustee (if applicable) of, or compliance
by it with, this Master Loan Sale Agreement or the consummation of the
transactions contemplated by this Master Loan Sale Agreement, except for
such consents, approvals, authorizations or orders, if any, that have been
obtained prior to the related Purchase Date;

(xii)

The transfer of the Loans shall be treated as a sale on the books and
records of the Seller and the Eligible Lender Trustee (if applicable), and
each of the Seller and the Eligible Lender Trustee (if applicable) will treat
the disposition of the Loans pursuant to this Master Loan Sale Agreement
for tax and accounting purposes as a sale. Each of the Seller and the
Eligible Lender Trustee (if applicable) shall maintain a complete set of
books and records for each Loan which shall be clearly marked to reflect
the ownership of each Loan by the Department;

(xiii) The consideration received by the Seller upon the sale of the Loans
constitutes fair consideration and reasonably equivalent value for such
Loans;
(xiv)

The Seller is solvent and will not be rendered insolvent by the
consummation of the transactions contemplated hereby. The Seller is not
transferring any Loan with any intent to hinder, delay or defraud any of its
creditors; and

(xv)

The Seller has an internal quality control program that verifies, on a
regular basis, the existence and accuracy of its legal documents, credit
documents and underwriting decisions. The program shall include
evaluating and monitoring the overall quality of the Seller’s loan
production and the servicing of such loans. The program is to ensure that
the Loans are originated and serviced in accordance with applicable law;
guard against dishonest, fraudulent, or negligent acts; and guard against
errors and omissions by officers, employees, or other authorized persons.
- 15 -

B.
Loan Level Representations. The Seller, and to the extent expressly required
below, the Eligible Lender Trustee (if applicable), represents and warrants to the Department as
to each Loan purchased by the Department under a Bill of Sale, as of the related Purchase Date:
(i)

The Seller or the Eligible Lender Trustee (as applicable) has good and
marketable title to, and the Seller and Eligible Lender Trustee together are
the sole owners of, the Loans, free and clear of any security interest or lien
(other than an interest or lien that will be released simultaneously with the
purchase of the Loan hereunder pursuant to a Security Release
Certification), charges, claims, offsets, defenses, counterclaims or
encumbrances of any nature and no right of rescission, offsets, defenses or
counterclaims have been asserted or threatened with respect to any Loan.
The sale of each Loan constitutes the absolute transfer of all right, title and
interests of the Seller and the Eligible Lender Trustee (if applicable) in
such Loan to the Department free and clear of any lien or adverse claim;

(ii)

Each Loan is an Eligible Loan and the description of and information
regarding the Loans set forth in the Bill of Sale and the Loan Schedule is
true, complete and correct;

(iii)

The Seller or the Eligible Lender Trustee (as applicable) is authorized to
sell, assign, transfer and reacquire the Loans; and the sale, assignment and
transfer of such Loans is or, in the case of a Loan reacquisition by the
Seller or the Eligible Lender Trustee (if applicable), will be made pursuant
to and consistent with the laws and regulations under which each of the
Seller and the Eligible Lender Trustee (if applicable) operates, and will not
violate any decree, judgment or order of any court or agency, or conflict
with or result in a breach of any of the terms, conditions or provisions of
any agreement or instrument to which it is a party or by which the it or its
property is bound, or constitute a default (or an event which could
constitute a default with the passage of time or notice or both) thereunder;

(iv)

Each Loan is in full force and effect in accordance with its terms and is the
legal, valid and binding obligations of the respective Borrower thereunder
subject to no defenses;

(v)

No consents and approvals are required by the terms of any Loan for the
consummation of the sale of such Loans hereunder to the Department;

(vi)

Each Loan has been duly made and serviced in accordance with the
provisions of the FFELP established under the Higher Education Act, and
has been duly guaranteed by a Guarantor; the Guarantee Agreement is in
full force and effect, and all premiums due and payable to such Guarantor
as of the related Purchase Date shall have been paid in full;

(vii)

Each Loan provides or, when the payment schedule with respect thereto is
determined, will provide for payments on a periodic basis that fully
- 16 -

amortize the Principal Balance thereof by its maturity, as such maturity
may be modified in accordance with any applicable deferral or
forbearance periods granted in accordance with applicable laws, including,
those of the Higher Education Act or any applicable Guarantee
Agreement, as applicable;
(viii) Any payments on a Loan received by the Seller that have been allocated to
the reduction of principal and interest on such Loan have been allocated
on a simple interest basis;
(ix)

Each Loan has been duly made and serviced in accordance with the
provisions of the related program under which such Loan was originated
and all applicable federal, state and local laws;

(x)

Due diligence and reasonable care have been exercised in the making,
administering, servicing and collecting on each Loan and, all disclosures
of information required to be made pursuant to the Higher Education Act
prior to the Purchase Date have been made;

(xi)

Each Borrower is an eligible borrower under the terms of Section 428,
428B or 428H of the Higher Education Act, as applicable;

(xii)

All borrower origination and loan fees required by Section 438 of the
Higher Education Act have been paid to the Secretary or appropriately
reserved by the Seller or the Eligible Lender Trustee (if applicable) for
payment to the Secretary;

(xiii) Each Loan is denominated and payable only in Dollars in the United
States;
(xiv)

The transfer and assignment herein contemplated constitute a valid sale of
the Loans from the Seller or the Eligible Lender Trustee (if applicable) to
the Department, and the beneficial interest in and title to such Loans shall
not be part of the Seller’s or the Eligible Lender Trustee’s (if applicable)
estate in the event of its bankruptcy or the appointment of a receiver with
respect to it;

(xv)

Except for Loans executed electronically, there is only one originally
executed Promissory Note evidencing each Loan, and such original
Promissory Note (or a true and correct copy thereof) has been delivered to
the Custodian as bailee for the Department. For Loans that were executed
electronically, the Seller of such Loan (or its designee) has possession of
the electronic records evidencing the Promissory Note, including all Loan
Documents. The Promissory Notes that constitute or evidence the Loans
do not have any marks or notations indicating that they have been pledged,
assigned or otherwise conveyed to any Person other than the Department
or the Department’s designee;
- 17 -

(xvi)

To the extent any Loan is evidenced by an electronic Promissory Note or
an electronic record, or to the extent the signature of the obligor on any
Promissory Note is an electronic signature, the Sponsor has complied (and
has caused any originator or servicer of the Loan to comply) with all
regulations and other requirements provided by the applicable Guarantor
or the Department relating to the validity and enforceability of such
Promissory Note;

(xvii) Neither the Seller nor the Eligible Lender Trustee (if applicable) has
pledged, assigned, sold, granted a security interest in, or otherwise
conveyed any of the Loans (other than an interest or lien that will be
released simultaneously with the purchase of the Loan hereunder pursuant
to a Security Release Certification or, if applicable, any lien in favor of the
Department and its custodian under the Master Participation Agreement).
Neither the Seller nor the Eligible Lender Trustee (if applicable) has
authorized the filing of or is aware of any financing statements against it
that include a description of collateral covering the Loans hereunder or
any other security interest that has not been terminated, or that will not be
terminated upon purchase by the Department. Neither the Seller nor the
Eligible Lender Trustee (if applicable) is aware of any judgment or tax
lien filings against it; and
(xviii) No Borrower of a Loan as of the related Bill of Sale, is noted in the related
Loan File as being currently involved in a bankruptcy proceeding.
Section 7.
Rescission of Purchase; Obligation to Reimburse and Indemnify. Upon
the occurrence of any of the conditions set forth below in this Section 7, the Department may
rescind its purchase of a Loan, and upon written demand by the Department, the Seller shall
repay to the Department the Purchase Price for such Loan, plus accrued and unpaid interest and
applicable Special Allowance Payments with respect to such Loan from the Purchase Date to and
including the date of repayment, plus any amounts owed to the Secretary with respect to such
Loan, plus any attorneys’ fees, legal expenses, court costs, servicing fees or other fees and
expenses incurred by the Department in connection with such Loan, and the Department shall
thereupon relinquish its interest in such loan to the Seller:
A.
Any representation or warranty made or furnished by the Seller or the
Eligible Lender Trustee (if applicable) pursuant to Sections 6A and 6B of this Master
Loan Sale Agreement shall prove to have been materially incorrect as of the applicable
Purchase Date;
B.
On account of any circumstance or event that occurred prior the Purchase
Date of the Loan, a defense is asserted by a Borrower of the Loan with respect to such
Borrower’s obligation to pay all or any part of the Loan, and the Department, in good
faith, believes that the facts reported, if true, raise a reasonable doubt as to the legal
enforceability of such Loan; or
C.

The Loan is not, in fact, an Eligible Loan on its Purchase Date.
- 18 -

In addition to the obligation described above, the Seller shall indemnify the Department
and any subsequent purchaser of the Loans and hold them harmless against liability for any
losses, damages, penalties, fines, forfeitures, reasonable and necessary legal fees and related
costs, judgments, and other costs and expenses resulting from any claim, demand, defense or
assertion based on or grounded upon, or resulting from, any of the circumstances described in
Sections 7A through 7C above.
Section 8.

Obligation to Remit Subsequent Payments and Forward Communications.

A.
Any payment received by the Seller with respect to amounts accrued after the date
of the related Bill of Sale for any Loan sold to the Department, which payment is not reflected in
the related Loan Schedule, shall be held by the Seller in trust for the account of the Department
and the Seller hereby disclaims any title to or interest in any such amounts. Within two (2)
Business Days following the date of receipt, the Seller shall remit to the Department an amount
equal to any such payments along with a listing on a form provided by the Department
identifying the Loans with respect to which such payments were made, the amount of each such
payment and the date each such payment was received.
B.
Any written communication received at any time by the Seller or the Eligible
Lender Trustee (if applicable) with respect to any Loan subject to this Master Loan Sale
Agreement or the related Bill of Sale shall be transmitted to the Department, or its designated
agent, within two (2) Business Days of receipt. Such communications shall include, but not be
limited to, letters, notices of death or disability, notices of bankruptcy, forms requesting
deferment of repayment or loan cancellation, and like documents.
Section 9.
Continuing Obligation of the Seller. The Seller shall provide all
reasonable assistance necessary for the Department to resolve account problems raised by any
Borrower, the Guarantor or the Secretary provided such account problems are attributable to or
are alleged to be attributable to (a) an event occurring during the period the Seller owned the
related Loan, or (b) a payment made or alleged to have been made to the Seller.
Section 10. Liability of the Seller; Indemnities. The Seller shall be liable in
accordance herewith only to the extent of the obligations specifically undertaken by the Seller
under this Master Loan Sale Agreement and each related Bill of Sale.
A.
The Seller shall indemnify, defend and hold harmless the Department and its
officers, employees and agents in their individual capacity from and against any taxes that may at
any time be asserted against any such person with respect to the transactions contemplated herein
and in the other documents related hereto, including any sales, gross receipts, general
corporation, tangible and intangible personal property, privilege or license taxes and costs and
expenses in defending against the same.
B.
In addition to the indemnity of the Department set forth in Section 7 hereof, the
Seller shall indemnify, defend and hold harmless the Department and its officers, employees and
agents in their individual capacity, from and against liability for any and all costs, expenses
(including, without limitation, costs and expenses of litigation and of investigation counsel fees,
damages, judgments and amounts paid in settlement), losses, claims, damages and liabilities
- 19 -

arising out of, or imposed upon such person through, the Seller’s or the Eligible Lender Trustee’s
(if applicable) willful misfeasance, bad faith or negligence in the performance of its respective
duties under this Agreement, or by reason of its breach of any of its representations, warranties,
covenants or other obligations or duties under this Agreement.
Indemnification under Section 7 and this Section 10 shall survive the resignation or the
termination of this Master Loan Sale Agreement, and shall include reasonable fees and expenses
of counsel and expenses of litigation. If the Seller shall have made any indemnity payments
pursuant to this Section and the person to or on behalf of whom such payments are made
thereafter shall collect any of such amounts from others, such Person shall promptly repay such
amounts to the Seller, without interest.
Section 11. Transfer of Servicing. The Seller hereby agrees that the Loans are being
purchased by the Department on a servicing-released basis. If the Loan is subject to a servicing
agreement with any third party servicer, such agreement must be terminable with respect to such
Loan upon thirty (30) days’ notice by the Department (which may be given at any time following
the Department’s receipt of the Seller’s notice of intent to sell such Loan pursuant to Section 4A
hereof; provided, however, that such termination shall in no event be effective prior to the
consummation of the sale of such Loan to the Department), and the Seller shall be responsible
for any de-boarding, deconversion or related fees or expenses of such servicer. Accordingly,
upon purchase of any Loan, the Department shall obtain all rights to service such Loan and may,
in its sole discretion require deconversion of such Loan in order to service the Loan itself or
through a third-party servicer of its designation. The Seller shall deliver, or cause the servicer of
the Loans to deliver, the servicing and all related servicing files and records with respect to the
Loans to the designee specified by the Department in accordance with the servicing transfer
provisions provided by the Department to the Seller or its designated servicer; provided,
however, that the Seller and its designees may retain copies (in electronic or paper medium) of
the servicing files related to the origination and servicing of the Loans sold to the Department
hereunder.
Section 12. Merger or Consolidation of, or Assumption of the Obligations of, the
Seller. Any Person (a) into which the Seller or the Eligible Lender Trustee (if applicable) may
be merged or consolidated, (b) which may result from any merger or consolidation to which the
Seller or the Eligible Lender Trustee (if applicable) shall be a party or (c) which may succeed to
the properties and assets of the Seller or the Eligible Lender Trustee (if applicable) substantially
as a whole, shall be the successor to the Seller or the Eligible Lender Trustee (if applicable)
without the execution or filing of any document or any further act by any of the parties to this
Master Loan Sale Agreement; provided, that (i) the surviving Person, if other than the Seller or
the Eligible Lender Trustee (if applicable), shall, promptly following such merger or
consolidation, execute and deliver to the Department an agreement of assumption to perform
every obligation of the Seller or the Eligible Lender Trustee (if applicable) under this Master
Loan Sale Agreement and each Bill of Sale; (ii) immediately after giving effect to such
transaction, no representation or warranty made pursuant to Section 6 shall have been breached;
and (iii) the surviving person, if other than the Seller, shall, promptly following such merger or
consolidation, deliver to the Department an Officers’ Certificate in the form of Exhibit C and an
Opinion of Counsel in the form of Exhibit D each stating that such consolidation, merger or
succession and such agreement of assumption comply with this Section and that all conditions
- 20 -

precedent, if any, provided for in this Master Loan Sale Agreement relating to such transaction
have been complied with.
Section 13. Expenses. The Department shall pay the legal fees and expenses of its
attorneys. The Seller shall pay all other costs and expenses incurred in connection with
preparation, execution and delivery of this Master Loan Sale Agreement and any Bill of Sale and
the transactions contemplated herein or therein, including, without limitation, the reasonable fees
and out-of-pocket expenses of counsel for any Seller with respect thereto, and all other costs and
expenses incurred in connection with the transfer and delivery of the Loans to the Department,
including, without limitation, any fees and expenses incurred in connection with transferring
ownership of any Loans to the Department.
Section 14. Survival of Covenants. All covenants, agreements, representations and
warranties made herein and in or pursuant to any Bills of Sale executed pursuant to this Master
Loan Sale Agreement shall survive the consummation of the acquisition of the Loans provided
for in the related Bill of Sale. All covenants, agreements, representations and warranties made or
furnished pursuant hereto by or on behalf of the Seller and the Eligible Lender Trustee (if
applicable) shall bind and inure to the benefit of any successors or assigns of the Department and
shall survive with respect to each Loan.
Section 15. Communication and Notice Requirements. All communications, notices
and approvals provided for hereunder shall be in writing and mailed or delivered to the Seller,
the Eligible Lender Trustee (if applicable), or the Department, as the case may be, at such
address as either party may hereafter designate by notice to the other party. All demands, notices
and communications hereunder shall be in writing and shall be deemed to have been duly given
if mailed, by registered or certified mail, return receipt requested, or, if by other means, when
received by the other party at the address as follows:
If to the Department:
By U.S. Postal Service mail:
United States Department of Education
400 Maryland Avenue, SW
UCP, Room 111G3
Washington, DC 20202-5402
Attention: FFEL Agreement Process Team
By courier or express mail:
United States Department of Education
830 First Street, N.E.
Room 111G3
Washington, DC 20202-5402
Attention: FFEL Agreement Process Team

- 21 -

If to the Seller or the Eligible Lender Trustee:
The address designated in the accompanying Adoption Agreement.
Section 16. Form of Instruments. All instruments and documents delivered in
connection with this Master Loan Sale Agreement and any Bill of Sale, and all proceedings to be
taken in connection with this Master Loan Sale Agreement and any Bill of Sale and the
transactions contemplated herein and therein, shall be in a form as set forth in the attachments
hereto, and the Department shall have received copies of such documents as it or its counsel shall
reasonably request in connection therewith.
Section 17. Amendment; Waiver. This Master Loan Sale Agreement, any Bill of Sale
and any document or instrument delivered in accordance herewith or therewith may be amended
by the parties hereto and thereto with the written consent of all parties hereto or thereto. No term
or provision of this Master Loan Sale Agreement may be waived or modified unless such waiver
or modification is consistent with the requirements of Section 459A of the Higher Education Act,
is in writing and signed by the party against whom such waiver or modification is sought to be
enforced.
Section 18. Audits. Pursuant to Section 432(f) of the Higher Education Act, Seller
hereby grants the Department and its agents (including but not limited to, legal counsel and
internal or external auditors), the right at any time and from time to time during regular business
hours, (i) to examine and make copies of and abstracts from all books, records and documents
(including, without limitation, computer tapes and disks) in the possession or under the control of
Seller relating to Loans sold hereunder and (ii) to visit the offices of Seller for the purpose of
examining such material described in clause (i) above, and to discuss matters relating to such
Loans or Seller’s performance hereunder with any officers and employees of Seller having
knowledge of such matters.
Section 19. Severability Clause. Any part, provision, representation or warranty of
this Master Loan Sale Agreement which is prohibited or which is held to be void or
unenforceable shall be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any part, provision, representation or warranty of
this Master Loan Sale Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction, to the extent of such
prohibition or unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction as to any Loan shall not invalidate or
render unenforceable such provision in any other jurisdiction. To the extent permitted by
applicable law, the parties hereto waive any provision of law which prohibits or renders void or
unenforceable any provision hereof. If the invalidity of any part, provision, representation or
warranty of this Master Loan Sale Agreement shall deprive any party of the economic benefit
intended to be conferred by this Master Loan Sale Agreement, the parties shall negotiate, in
good-faith, to develop a structure the economic effect of which is nearly as possible the same as
the economic effect of this Master Loan Sale Agreement without regard to such invalidity.
Section 20. Governing Law. This Master Loan Sale Agreement and any Bill of Sale
and the rights and obligations of the parties thereto shall be governed by and construed in
- 22 -

accordance with Federal law. To the extent there may be no applicable Federal law, the internal
laws of the State of New York (without giving regard to conflicts of laws principles other than
Sections 5-1401 and 5-1402 of the New York General Obligations Law) shall be deemed
reflective of Federal law insofar as to do so would not frustrate the purposes of any provision of
this Master Loan Sale Agreement or the transactions governed thereby.
Section 21. Exhibits. The exhibits to this Master Loan Sale Agreement are hereby
incorporated and made a part hereof and are an integral part of this Master Loan Sale Agreement.
Section 22. General Interpretive Principles. For purposes of this Master Loan Sale
Agreement, except as otherwise expressly provided or unless the context otherwise requires:
A.
The terms defined in this Master Loan Sale Agreement have the meanings
assigned to them in this Master Loan Sale Agreement and include the plural as well as the
singular, and the use of any gender herein shall be deemed to include the other gender;
B.
Accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles;
C.
References herein to “Articles,” “Sections,” “Subsections,” “Paragraphs,” and
other Subdivisions without reference to a document are to designated Articles, Sections,
Subsections, Paragraphs and other subdivisions of this Master Loan Sale Agreement;
D.
Reference to a Subsection without further reference to a Section is a reference to
such Subsection as contained in the same Section in which the reference appears, and this rule
shall also apply to Paragraphs and other subdivisions;
E.
The words “herein,” “hereof,” “hereunder” and other words of similar import
refer to this Master Loan Sale Agreement as a whole and not to any particular provision; and
F.
The term “include” or “including” shall mean without limitation by reason of
enumeration.
Section 23. Reproduction of Documents. This Master Loan Sale Agreement and all
documents relating thereto, including, without limitation, (a) consents, waivers and modifications
which may hereafter be executed, (b) documents received by any party at the closing, and (c)
financial statements, certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature photographic or
other similar process. The parties agree that any such reproduction shall be admissible in
evidence as the original itself in any judicial or administrative proceeding, whether or not the
original is in existence and whether or not such reproduction was made by a party in the regular
course of business, and that any enlargement, facsimile or further reproduction of such
reproduction shall likewise be admissible in evidence.
Section 24. Further Agreements. Each of the Seller and the Eligible Lender Trustee
(if applicable) agrees to execute and deliver to the other such reasonable and appropriate
additional documents, instruments or agreements as may be necessary or appropriate to
effectuate the purposes of this Master Loan Sale Agreement.
- 23 -

Section 25. Other Department Program. Separately, the Department is offering a Loan
Participation Purchase Program (as referred to in the Notice of Intent to Participate) for eligible
FFELP loans. This Master Loan Sale Agreement does not require, nor does it preclude, the
participation of the Seller in that separate program.
Section 26. Adoption. This Master Loan Sale Agreement shall be effective with
respect to any Seller and the Eligible Lender Trustee (if applicable) as of the day and year on
which an Adoption Agreement, in the form attached hereto as Exhibit A, is entered into by both
such Seller, the Eligible Lender Trustee (if applicable) and the Department.
Section 27. Integration. The Master Loan Sale Agreement, together with the related
Adoption Agreement and any interpretive guidance published by, and binding on, the
Department prior to November 1, 2008, embodies the entire agreement and understanding of the
parties hereto and thereto and supersedes any and all prior agreements, arrangements and
understandings relating to the matters provided for herein and therein.
[NO FURTHER TEXT ON THIS PAGE]

- 24 -

EXHIBIT A
FORM OF ADOPTION AGREEMENT
This Adoption Agreement, dated as of the date set forth on the signature page, among the
United States Department of Education (“Department”) [, the Eligible Lender Trustee (as listed
in Section 1A hereof) (“Eligible Lender Trustee”)] and the Seller (as listed in Section 1 hereof)
(“Seller”) is made pursuant to the Master Loan Sale Agreement, dated July 25, 2008, published
by the Department (“Master Loan Sale Agreement”). Capitalized terms used but not otherwise
defined herein, shall have the meanings set forth in the Master Loan Sale Agreement.
a)
The Department desires to purchase and the Seller desires to sell to the
Department, from time to time, certain Eligible Loans (as that term is defined in the Master Loan
Sale Agreement).
b)
The Department[, the Eligible Lender Trustee] and the Seller desire to set
forth herein the terms and conditions of such purchase and sale arrangements.
c)
This Adoption Agreement shall supersede and replace all prior agreements
between the parties regarding the sale of Eligible Loans by the Seller [and the Eligible Lender
Trustee] to the Department.
NOW, THEREFORE, in consideration of the above recitals and for other good and
valuable consideration, the receipt and adequacy of which are hereby acknowledged, the
Department and the Seller hereby agree as follows:
Section 1. “Seller” shall mean:
[SELLER]
[ADDRESS]
[LENDER ID]
The above address shall be the Seller’s address for the purpose of receiving notices pursuant to
the Master Loan Sale Agreement.
[Section 1A. “Eligible Lender Trustee” shall mean:
[ELIGIBLE LENDER TRUSTEE]
[ADDRESS]
[LENDER ID]
The above address shall be the Eligible Lender Trustee’s address for the purpose of receiving
notices pursuant to the Master Loan Sale Agreement.]
Section 2. Purchase and Sale of Loans. Following the date of this Adoption Agreement,
the Seller agrees to participate in the Department’s Purchase Program for Eligible Loans made
pursuant to the Federal Family Education Loan Program under the Master Loan Sale Agreement
and to deliver to the Department such Loans in the aggregate principal amounts as evidenced by
A-1

Bills of Sale executed by the Seller and acknowledged and accepted by the Department pursuant
to the Master Loan Sale Agreement. The Seller agrees to sell to the Department and the
Department agrees to purchase from the Seller such Loans on the terms and subject to the
conditions of the Master Loan Sale Agreement as the same may be supplemented or amended
from time to time. Each of the Seller and the Department hereby acknowledges and agrees to all
terms and provisions of the Master Loan Sale Agreement which relate to the selling of Loans
which are incorporated herein in their entirety as if such had been set forth herein in their
entirety, as the same may be supplemented or amended from time to time.
Section 3. Incorporation of Master Loan Sale Agreement. [Each of] [T]he Seller [and the
Eligible Lender Trustee] and the Department hereby acknowledges and agrees to all terms and
provisions of the Master Loan Sale Agreement which are incorporated herein in their entirety as
if such had been set forth herein in their entirety, as the same may be supplemented or amended
from time to time.
Section 4. Governing Law. This Adoption Agreement and the rights and obligations of
the parties hereto shall be governed by and construed in accordance with Federal law. Insofar as
there may be no applicable Federal law, the internal laws of the State of New York (without
giving regard to conflicts of laws principles other than Sections 5-1401 and 5-1402 of the New
York General Obligations Law) shall be deemed reflective of Federal law insofar as to do so
would not frustrate the purposes of any provision of this Adoption Agreement.
[Signature Page Follows]

A-2

IN WITNESS WHEREOF, the parties hereto have caused this Adoption Agreement to be
duly executed by their respective officers hereunto duly authorized, as of the day and year first
above written.

United States Department of Education
By:
Name:
Title:

Date of Adoption Agreement: ________________
(to be inserted by the Department)

[SELLER], as Seller

By:
Name:
Title:

[[ELIGIBLE LENDER TRUSTEE], as Eligible
Lender Trustee
By:
Name:
Title:]

A-3

EXHIBIT B
FORM OF BILL OF SALE
On this _______ day of ________, 200_, ___________ (“Seller”) as the Seller [and
__________ (“Eligible Lender Trustee”) as the Eligible Lender Trustee] under that certain
Master Loan Sale Agreement, dated July 25, 2008 and that certain Adoption Agreement
executed in connection therewith by the Seller [, the Eligible Lender Trustee] and the
Department of Education as of _____________ (“Agreement”) do[es] hereby sell, transfer,
assign, set over and convey to the Department as purchaser under the Agreement, without
recourse, but subject to the terms of the Agreement, all right, title and interest of the [Eligible
Lender Trustee and the] Seller in and to the Loans listed on the Loan Schedule attached hereto,
together with the related servicing files and servicing rights appurtenant thereto, the related
Promissory Notes and related Loan Documents (including, without limitation, any rights of the
Seller to receive from any third party any documents which constitute a part of the loan or
servicing files) and all rights and obligations arising under the documents contained therein.
Pursuant to the Agreement, the Seller has delivered to the Custodian the documents for each
Loan to be purchased as set forth in the Agreement.
The ownership of each Loan and the related Promissory Note and the contents of the
Loan file and servicing file is vested in the Department and the ownership of all records and
documents with respect to the related Loan prepared by or which come into the possession of the
Seller shall immediately vest in the Department and be delivered to the Department or its agent
(except that copies thereof may be retained as provided in the Agreement). During any period
that the related Loan files and servicing files are retained by the Seller, such files shall be
retained and maintained, in trust, by the Seller for the benefit of the Department.
[Each of] [T]he Seller [and the Eligible Lender Trustee] confirms to the Department that
the representations and warranties set forth in Section 6 of the Agreement are true and correct
with respect to the Seller [and the Eligible Lender Trustee] and the Loans listed on the Loan
Schedule attached hereto as of the date hereof, and that all statements made in the Seller’s
Officer’s Certificate and all attachments thereto remain complete, true and correct in all respects
as of the date hereof, and that the Loan characteristics identified on the attached Loan Schedule
are true and correct as of the date hereof.
The Seller authorizes the Department to use a copy of this Bill of Sale, including the
Loan Schedule attached to the Bill of Sale, as official notification to the applicable Guarantor of
assignment to the Department of the Loans purchased pursuant hereto on the Purchase Date.
Capitalized terms used herein and not otherwise defined shall have the meanings set forth
in the Agreement.

B-1

IN WITNESS WHEREOF, the undersigned Seller [and the Eligible Lender Trustee] has
executed and delivered this Bill of Sale as of the date first above written.
[SELLER], as
Seller
By:
Name:
Title:

[[ELIGIBLE LENDER TRUSTEE], as Eligible
Lender Trustee
By:
Name:
Title:

Acknowledged and Accepted as of the date first written above

United States Department of Education
By:
Name:
Title:

B-2

]

Schedule 1
Loan Schedule

B-3

EXHIBIT C
FORM OF SELLER’S OFFICER’S CERTIFICATE
I, ________________________, hereby certify that I am the duly elected
______________ of [SELLER], a ______________ (“Seller”), and further certify, on behalf of
the Seller as follows:
1.
Attached hereto as Attachment I are a true and correct copy of the
[Certificate of Incorporation and by-laws][certificate of limited partnership and limited
partnership agreement][certificate of formation and limited liability company operating
agreement] of the Seller as are in full force and effect on the date hereof.
2.
No proceedings looking toward merger, liquidation, dissolution or
bankruptcy of the Seller are pending or contemplated.
3.
Each person who, as an officer or attorney-in-fact of the Seller, signed (a)
the Adoption Agreement dated as of ____________ between the Department[, the Eligible
Lender Trustee] and the Seller pursuant to the Master Loan Sale Agreement (“Agreement”),
dated July 25, 2008, by the Department of Education (“Department”) and (b) any other document
delivered prior hereto or on the date hereof in connection with the sale of the Loans in
accordance with the Agreement and the related Bill of Sale was, at the respective times of such
signing and delivery, and is as of the date hereof, duly elected or appointed, qualified and acting
as such officer or attorney-in-fact, and the signatures of such persons appearing on such
documents are their genuine signatures.
4.
Attached hereto as Attachment II is a true and correct copy of the
resolutions duly adopted by the board of directors of the Seller on ________________, 200_
(“Resolutions”) with respect to the authorization and approval of the sale of the Loans; said
Resolutions have not been amended, modified, annulled or revoked and are in full force and
effect on the date hereof.
5.
Attached hereto as Attachment III is a Certificate of Good Standing of the
Seller dated ______________, 200_. No event has occurred since ___________________, 200_
which has affected the good standing of the Seller under the laws of the State of ___________.
6.
All of the representations and warranties of the Seller contained in
Section 6 of the Agreement were true and correct in all material respects as of the date of the
Agreement and are true and correct in all material respects as of the date hereof.
7.
[Each of] [T]he Seller [and the Eligible Lender Trustee] has performed all
of its duties and has satisfied all the material conditions on its part to be performed or satisfied
prior to the related Purchase Date pursuant to the Agreement and the related Bill of Sale.
All capitalized terms used herein and not otherwise defined shall have the
meaning assigned to them in the Agreement.

C-1

IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal
of the Seller.
Dated: _________________________
[Seal]
[SELLER]
(Seller)
By:
Name:
Title: [Responsible Officer]

I, _______________________, Secretary of the Seller, hereby certify that
_________________________ is the duly elected, qualified and acting [Responsible Officer] of
the Seller and that the signature appearing above is his/her genuine signature.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated:_________________________
[Seal]
[SELLER]
(Seller)
By:
Name:
Title: [Assistant] Secretary

C-2

EXHIBIT D
FORM OF OPINION OF COUNSEL TO THE SELLER
______________________________
(Date)
United States Department of Education
400 Maryland Avenue, SW
Washington, DC 20202
Re:

Master Loan Sale Agreement, dated July 25, 2008

Gentlemen:
I have acted as counsel to [SELLER], a _________________ (“Seller”), in
connection with the sale of certain Loans by the Seller to the Department of Education
(“Department”) pursuant to a Master Loan Sale Agreement, dated July 25, 2008, and the related
Adoption Agreement dated as of _____________, between the Seller, [the Eligible Lender
Trustee] and the Department (“Agreement”). Capitalized terms not otherwise defined herein
have the meanings set forth in the Agreement.
In connection with rendering this opinion letter, I, or attorneys working under my
direction, have examined, among other things, originals, certified copies or copies otherwise
identified to my satisfaction as being true copies of the following:
A.
B.

C.
D.

The Agreement;
The Seller’s [Certificate of Incorporation and by-laws][certificate of
limited partnership and limited partnership agreement][certificate of
formation and limited liability company operating agreement], as
amended to date;
Resolutions adopted by the Board of Directors of the Seller with
specific reference to actions relating to the transactions covered by
this opinion (“Board Resolutions”); and
Such other documents, records and papers as we have deemed
necessary and relevant as a basis for this opinion.

For the purpose of rendering this opinion, I have made such documentary, factual
and legal examinations as I deemed necessary under the circumstances. As to factual matters, I
have relied upon statements, certificates and other assurances of public officials and of officers
and other representatives of the Seller, and upon such other certificates as I deemed appropriate,
which factual matters have not been independently established or verified by me. I have also
assumed, among other things, the genuineness of all signatures, the legal capacity of all natural
persons, the authenticity of all documents submitted to me as originals, and the conformity to
original documents of all documents submitted to me as copies and the authenticity of the
originals of such copied documents.
D-1

On the basis of and subject to the foregoing examination, and in reliance thereon,
and subject to the assumptions, qualifications, exceptions and limitations expressed herein (if
any), I am of the opinion that:
1.
The Seller has been duly [incorporated][formed] and is validly existing
and in good standing under the laws of the State of __________ with corporate power and
authority to own its properties and conduct its business as presently conducted by it. The Seller
has the corporate power and authority to service the Loans, and to execute, deliver, and perform
its obligations under the Agreement.
2.
The Agreement has been duly and validly authorized, executed and
delivered by the Seller.
3.
The Agreement constitutes valid the legal and binding obligation of the
Seller, enforceable against the Seller in accordance with its terms.
4.
No consent, approval, authorization or order of any state or federal court
or government agency or body is required for the execution, delivery and performance by the
Seller of the Agreement or the consummation of the transactions contemplated by the
Agreement, except for those consents, approvals, authorizations or orders which previously have
been obtained.
5.
The fulfillment of the terms of or the consummation of any other
transactions contemplated in the Agreement will not result in a breach of any term or provision
of the [certificate of incorporation or by-laws][certificate of limited partnership or limited
partnership agreement][certificate of formation and limited liability company operating
agreement] of the Seller, or, to the best of my knowledge, will not conflict with, result in a
breach or violation of, or constitute a default under, (i) the terms of any indenture or other
agreement or instrument known to me to which the Seller is a party or by which it is bound, (ii)
any State of ____________ or federal statute or regulation applicable to the Seller, or (iii) any
order of any State of ____________ or federal court, regulatory body, administrative agency or
governmental body having jurisdiction over the Seller, except in any such case where the default,
breach or violation would not have a material adverse effect on the Seller or its ability to perform
its obligations under the Agreement.
6.
There is no action, suit, proceeding or investigation pending or, to the best
of my knowledge, threatened against the Seller which, in my judgment, either in any one
instance or in the aggregate, would draw into question the validity of the Agreement or which
would be likely to impair materially the ability of the Seller to perform under the terms of the
Agreement.
7.
The sale of each Loan as and in the manner contemplated by the
Agreement is sufficient fully to transfer to the Department all right, title and interest of the Seller
thereto as noteholder.
[Assumptions and qualifications, if any]

D-2

I am admitted to practice law in the State of ___________, and I render no
opinion herein as to matters involving the laws of any jurisdiction other than the State of
_________ and the Federal laws of the United States of America.
Very truly yours,

D-3

EXHIBIT E
FORM OF SECURITY RELEASE CERTIFICATION
I.

Release of Security Interest

___________________________, hereby relinquishes any and all right, title and
interest it may have in and to the Loans described on Schedule 1 attached hereto upon purchase
thereof by the Department of Education from the Seller named below pursuant to that certain
Master Loan Sale Agreement, dated July 25, 2008, and the related Adoption Agreement between
the Seller, [the Eligible Lender Trustee] and the Department of Education dated as of
______________________,
as
of
the
date
and
time
of
receipt
by
______________________________ of $__________ for such Loans (“Date and Time of
Sale”), and certifies that, as of the Date and Time of Sale, (i) all notes, assignments and other
documents in its possession relating to such Loans have been delivered and released to the Seller
named below or its designees, other than copies thereof that are retained by the undersigned or
its designee (in electronic or paper medium), and (ii) all appropriate Uniform Commercial Code
termination statements have been filed evidencing the release of its lien on the related Loans.
Name and Address of Financial Institution
(Name)
(Address)
By:______________________________________

E-1

II.

Certification of Release

The Seller named below hereby certifies to the Department of Education that, as
of the Date and Time of Sale of the above mentioned Loans to the Department of Education, the
security interests in the Loans released by the above named corporation comprise all security
interests relating to or affecting any and all such Loans. The Seller warrants that, as of such
time, there are and will be no other security interests affecting any or all of such Loans.
Seller
By:
Name:
Title:

E-2

Schedule 1
Loan Schedule

E-3

EXHIBIT F
FORM OF NOTICE OF INTENT TO PARTICIPATE
[__________, 200_]
U.S. Department of Education
Washington, D.C.
By: E-mail: [email protected]

Re:

Loan Purchase Commitment Program and/or Loan Participation Purchase Program for
Eligible FFELP Loans

Ladies and Gentlemen:
The undersigned, an eligible Federal Family Education Loan Program (FFELP) lender under
Section 435(d)(1) of the Higher Education Act of 1965, as amended (HEA), eligible lender trustee, or
holder of beneficial interests in FFELP Loans (“Undersigned”), hereby notifies the United States
Department of Education that it intends to participate in one or both of the following FFEL Loan
Purchase programs for the 2008-2009 academic year. The Loan Purchase programs are authorized under
Section 459A of the HEA, as amended by the Ensuring Continued Access to Student Loans Act of 2009
(Pub. L. No. 110-227), and described in the Notice of Terms and Conditions of Purchase of Loans under
the Ensuring Continued Access to Student Loans Act of 2008 (Register Notice) published in the Federal
Register, Vol. 73, No. 127, July 1, 2008. Signifying intent to participate in one or both of the programs
offered does not require actual participation in such programs.
CHECK THE APPLICABLE BOX(ES):

□
□

Loan Purchase Commitment Program
Loan Participation Purchase Program and the
Loan Purchase Commitment Program

By signifying its intent to participate in such program(s), the Undersigned hereby certifies and agrees that:
If the Undersigned participates in either of the programs, it will continue to originate or acquire FFELP
loans made to students and parents.
If the Undersigned participates in the Loan Participation Purchase Program, it will sell, from time to time,
participation interests in FFELP loans to the Department of Education with an aggregate unpaid principal
balance of not less than $50,000,000 in loans either held by such eligible lender or aggregated with other
FFELP loans held by one or more eligible lenders. Note that there is no minimum for the Loan Purchase
Commitment Program.
The Undersigned acknowledges that it shall not be permitted to sell FFELP loans or participation interests
therein to the Department of Education with respect to which the first disbursement was made prior to the
date on which the Department of Education receives this Notice of Intent to Participate, except that, if the
Department of Education receives this Notice of Intent to Participate by July 31, 2008 the Undersigned
shall be permitted to sell to the Department of Education FFELP loans or participation interests therein, as
applicable, where the first disbursement of the loan(s) was made on or after May 1, 2008.

F-1

For the purpose of item 3 above, the Department of Education will return to the Undersigned, via
electronic mail (e-mail), information indicating the date the Notice of Intent to Participate was received
by the Department of Education.
The Department of Education has provided that it will accept signed copies of this Notice of Intent sent as
a PDF attachment via e-mail at the address below.
The Undersigned is aware that it must refer to the Federal Register Notice and to the agreements referred
to therein for a complete description of the terms and conditions under which the Department of
Education will administer the Loan Purchase Programs. The Undersigned also is aware that in order to
participate in the Loan Purchase programs it must execute a Master Agreement for the respective
program. If the Undersigned is a beneficial holder of FFELP loans, include on this form the LID(s) under
which it operates. If the Undersigned, as an eligible lender trustee, files this Notice on behalf of its
beneficial holders of FFELP loans, include the name and LID of each of those beneficial holders.
This Notice of Intent to Participate is hereby executed and dated as of the date first listed above.
By executing this Notice of Intent, the Undersigned now possesses an option to participate in the Loan
Purchase Program or Programs indicated by the Undersigned above.
The Undersigned asks that the Department of Education please direct all inquiries and correspondence
relating to these programs to:
[UNDERSIGNED NAME AND LENDER ID NUMBER]
[ELIGIBLE LENDER TRUSTEE NAME OR BENEFICIAL HOLDER
NAME, IF ANY AND LIDS]
[STREET ADDRESS]
[CITY], [STATE] [ZIP]
Attention of: [NAME], [TITLE]
By Phone - [XXX-XXX-XXXX]
By Fax – [XXX-XXX-XXXX]
By E-mail – [email address]
[NAME OF ENTITY]
By:___________________________
Name:
Title:
The completed, signed, and dated Notice of Intent to Participate should be sent as a PDF attachment to an
e-mail message addressed to [email protected]. The e-mail message subject line should read
“Submission of Notice of Intent to Participate.”
For questions concerning the submission and receipt of the email please call (202) 377-4401.

F-2