Exhibit 10.9
GREAT LAKES HIGHER EDUCATION CORPORATION
0000 XXXXXXXXXXXXX XXXX, XXXXXXX, XXXXXXXXX 00000
Student Loan Guaranty
(For Loans to Students and Parents Under Title IV Part B of the
Higher Education Act of 1965 as amended)
Definitions: The term guarantor used herein shall mean the Great Lakes Higher
Education Corporation. Corporation shall mean Great Lakes Higher Education
Corporation. Lender shall include the undersigned and any eligible lender who
becomes the assignee, pursuant to applicable statutes and regulations, of loans
to students and parents granted under Title IV, Part B of the Higher Education
Act of 1965, as amended (the "Act").
Applicability. The benefits provided under this guaranty are applicable to any
loan guaranteed under the Act. Within such limits as may be established herein
and/or within such limits as the guarantor shall from time to time establish,
the guarantor agrees to pay, upon proper notice of death, permanent and total
disability or default, the outstanding principal and interest due to the lender
upon any student or parent loan covered by this guaranty.*
Limitations. This guaranty is subject to all applicable federal statutes and
administrative regulations. This guaranty is further subject to such limitations
and procedures as are, or may be, established by Rules and Regulations of the
Great Lakes Higher Education Corporation (the "Corporation Rules and
Regulations"). All applicable federal statutes and regulations and Corporation
Rules and Regulations as they may from time to time be amended are made a part
of this guaranty and incorporated herein.
The obligations of the lender as set forth in this guaranty shall constitute
conditions precedent to any obligation on the part of the guarantor.
Obligations of the Lender:
(a) The lender shall be an eligible lender under the Act and federal
regulations.
(b) The lender shall exercise due diligence as defined under the Act and
federal regulations and within the meaning of the Corporation Rules and
Regulations.
(c) The lender shall comply with all applicable federal statutes and
regulations.
(d) The lender shall notify the Corporation promptly of any change of name by
the lender, or assignment of the lender's interest under this guaranty.
(e) Any assignments of any interest of the lender under this guaranty shall be
only to appropriate eligible lenders and shall be in compliance with all
applicable provisions of federal statutes and regulations and Corporation
Rules and Regulations.
(f) The lender shall cooperate with the Corporation, the department of
education and any other appropriate federal agency in the collection of any
defaulted student or parent loan.
(g) The lender shall assist eligible borrowers in securing reductions on
obligations to pay interest on loans made by, or assigned to, the lender
which reductions the borrowers may be eligible to receive under applicable
federal statutes and regulations and the Corporation Rules and Regulations.
Termination. This guaranty may be terminated by the lender as to any loans made
by the lender following not less than thirty days written notice to the
Corporation. This guaranty may be terminated by the Great Lakes Higher Education
Corporation in the manner provided for by the Corporation Rules and Regulations.
The termination of this guaranty shall not affect the coverage of any loans
subject to this guaranty which were made prior to the date of termination.
* Notwithstanding the foregoing, default claims with respect to loans first
disbursed on or after October 1, 1993, shall be paid at ninety-eight percent
(98%) of the outstanding principal and
interest due to the lender, or such lesser rate, if any, as may be provided in
Section 428(b)(1)(G) of the Higher Education Act of 1965, as amended.
Specifically, and without limitation, this guaranty shall not apply to any loan
which is not eligible for reinsurance as a result of school based defenses or
other defenses to enforceability under state or federal law. Payment hereunder
is expressly limited to monies constituting the guarantor's Guaranty Reserve
Fund as established in accordance with the regulations governing the Federal
Family Education Loan Program as found in 34 CFR 682.410(a)(1) or as provided
under Title IV, Part B, Section 432(o) of the Higher Education Act of 1965, as
amended.
Great Lakes Higher Education Corporation
By: /s/ 7/15/97
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Authorized Officer Date
The above Guaranty is hereby accepted this 10th day of July, 1997
Exact Corporate Title First Bank National Association as Trustee for Education
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Loans Inc.
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By /s/ Xxxx Xxxxxxxx Title of Officer Senior Vice President
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Employer Identification Number 00-0000000 Lender Number 833405
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