EXHIBIT 4.3
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INDENTURE
among
SLM STUDENT LOAN TRUST 2004-7,
as the Issuer,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as the Eligible Lender Trustee
and
DEUTSCHE BANK TRUST COMPANY AMERICAS,
not in its individual capacity but
solely as the Indenture Trustee
Dated as of July 1, 2004
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Usage
SECTION 1.1 Definitions and Usage..................................................... 2
SECTION 1.2 Incorporation by Reference of Trust Indenture Act......................... 2
ARTICLE II
The Notes
SECTION 2.1 Form...................................................................... 3
SECTION 2.2 Execution, Authentication and Delivery.................................... 3
SECTION 2.3 Temporary Notes........................................................... 4
SECTION 2.4 Registration; Registration of Transfer and Exchange....................... 4
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes................................ 5
SECTION 2.6 Persons Deemed Owner...................................................... 6
SECTION 2.7 Payment of Principal and Interest; Note Interest Shortfall................ 6
SECTION 2.8 Cancellation.............................................................. 7
SECTION 2.9 Release of Collateral..................................................... 7
SECTION 2.10 Book-Entry Notes.......................................................... 7
SECTION 2.11 Notices to Clearing Agency................................................ 8
SECTION 2.12 Definitive Notes.......................................................... 9
ARTICLE III
Covenants
SECTION 3.1 Payments to Noteholders................................................... 9
SECTION 3.1A Collateral Account........................................................ 10
SECTION 3.2 Maintenance of Office or Agency........................................... 10
SECTION 3.3 Money for Payments to be Held in Trust.................................... 10
SECTION 3.4 Existence................................................................. 12
SECTION 3.5 Protection of Indenture Trust Estate...................................... 12
SECTION 3.6 Opinions as to Indenture Trust Estate..................................... 13
SECTION 3.7 Performance of Obligations; Servicing of Trust Student Loans.............. 13
SECTION 3.8 Negative Covenants........................................................ 16
SECTION 3.9 Annual Statement as to Compliance......................................... 16
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms....................... 17
SECTION 3.11 Successor or Transferee................................................... 18
SECTION 3.12 No Other Business......................................................... 18
SECTION 3.13 No Borrowing.............................................................. 19
SECTION 3.14 Obligations of Servicer and Administrator................................. 19
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities......................... 19
SECTION 3.16 Capital Expenditures...................................................... 19
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SECTION 3.17 Restricted Payments....................................................... 19
SECTION 3.18 Notice of Events of Default............................................... 19
SECTION 3.19 Further Instruments and Acts.............................................. 20
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1 Satisfaction and Discharge of Indenture................................... 20
SECTION 4.2 Application of Trust Money................................................ 21
SECTION 4.3 Repayment of Moneys Held by Paying Agent.................................. 21
SECTION 4.4 Auction of Trust Student Loans............................................ 21
ARTICLE V
Remedies
SECTION 5.1 Events of Default......................................................... 22
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment........................ 23
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement
by Indenture Trustee...................................................... 24
SECTION 5.4 Remedies; Priorities...................................................... 25
SECTION 5.5 Optional Preservation of the Trust Student Loans.......................... 27
SECTION 5.6 Limitation of Suits....................................................... 28
SECTION 5.7 Unconditional Rights of Noteholders to Receive Principal and Interest..... 28
SECTION 5.8 Restoration of Rights and Remedies........................................ 29
SECTION 5.9 Rights and Remedies Cumulative............................................ 29
SECTION 5.10 Delay or Omission Not a Waiver............................................ 29
SECTION 5.11 Control by Noteholders.................................................... 29
SECTION 5.12 Waiver of Past Defaults................................................... 30
SECTION 5.13 Undertaking for Costs..................................................... 30
SECTION 5.14 Waiver of Stay or Extension Laws.......................................... 30
SECTION 5.15 Action on Notes........................................................... 30
SECTION 5.16 Performance and Enforcement of Certain Obligations........................ 31
ARTICLE VI
The Indenture Trustee
SECTION 6.1 Duties of Indenture Trustee............................................... 31
SECTION 6.2 Rights of Indenture Trustee............................................... 32
SECTION 6.3 Individual Rights of Indenture Trustee.................................... 33
SECTION 6.4 Indenture Trustee's Disclaimer............................................ 33
SECTION 6.5 Notice of Defaults........................................................ 33
SECTION 6.6 Reports by Indenture Trustee to Noteholders............................... 34
SECTION 6.7 Compensation and Indemnity................................................ 34
SECTION 6.8 Replacement of Indenture Trustee.......................................... 34
SECTION 6.9 Successor Indenture Trustee by Merger..................................... 35
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee............................. 36
SECTION 6.11 Eligibility; Disqualification............................................. 37
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SECTION 6.12 Preferential Collection of Claims Against the Issuer...................... 37
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.1 Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders.... 37
SECTION 7.2 Preservation of Information; Communications to Noteholders................ 38
SECTION 7.3 Reports by Issuer......................................................... 38
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.1 Collection of Money....................................................... 39
SECTION 8.2 Trust Accounts............................................................ 39
SECTION 8.3 General Provisions Regarding Accounts..................................... 39
SECTION 8.4 Release of Indenture Trust Estate......................................... 40
SECTION 8.5 Opinion of Counsel........................................................ 41
ARTICLE IX
Supplemental Indentures
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders.................... 41
SECTION 9.2 Supplemental Indentures with Consent of Noteholders....................... 42
SECTION 9.3 Execution of Supplemental Indentures...................................... 43
SECTION 9.4 Effect of Supplemental Indenture.......................................... 44
SECTION 9.5 Conformity with Trust Indenture Act....................................... 44
SECTION 9.6 Reference in Notes to Supplemental Indentures............................. 44
ARTICLE X
Redemption of Notes
SECTION 10.1 Redemption................................................................ 44
SECTION 10.2 Form of Redemption Notice................................................. 44
SECTION 10.3 Notes Payable on Redemption Date.......................................... 45
ARTICLE XI
Miscellaneous
SECTION 11.1 Compliance Certificates and Opinions, etc................................. 45
SECTION 11.2 Form of Documents Delivered to Indenture Trustee.......................... 47
SECTION 11.3 Acts of Noteholders....................................................... 48
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer and Rating Agencies........... 48
SECTION 11.5 Notices to Noteholders; Waiver............................................ 49
SECTION 11.6 Alternate Payment and Notice Provisions................................... 49
SECTION 11.7 Conflict with Trust Indenture Act......................................... 50
SECTION 11.8 Effect of Headings and Table of Contents.................................. 50
SECTION 11.9 Successors and Assigns.................................................... 50
SECTION 11.10 Separability.............................................................. 50
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SECTION 11.11 Benefits of Indenture..................................................... 50
SECTION 11.12 Legal Holidays............................................................ 50
SECTION 11.13 Governing Law............................................................. 50
SECTION 11.14 Counterparts.............................................................. 51
SECTION 11.15 Recording of Indenture.................................................... 51
SECTION 11.16 Trust Obligations......................................................... 51
SECTION 11.17 No Petition............................................................... 51
SECTION 11.18 Inspection................................................................ 51
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APPENDICES, SCHEDULES AND EXHIBITS
APPENDIX A Definitions and Usage
SCHEDULE A Schedule of Trust Student Loans
SCHEDULE B Location of Trust Student Loan Files
EXHIBIT A Forms of Notes
EXHIBIT B Form of Note Depository Agreement
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INDENTURE, dated as of July 1, 2004, among SLM STUDENT LOAN TRUST
2004-7, a Delaware statutory trust (the "Issuer"), CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION, a national banking association, not in its individual
capacity but solely as eligible lender trustee on behalf of the Issuer (in such
capacity, the "Eligible Lender Trustee"), and DEUTSCHE BANK TRUST COMPANY
AMERICAS, a New York banking corporation, not in its individual capacity but
solely as indenture trustee (in such capacity, the "Indenture Trustee").
Each party agrees as follows for the benefit of the other party and
for the equal and ratable benefit of the holders of the Issuer's Student
Loan-Backed Notes (the "Notes"):
GRANTING CLAUSE
The Issuer and, with respect to the Trust Student Loans, the
Eligible Lender Trustee hereby Grant to the Indenture Trustee, as trustee for
the benefit of the Noteholders, effective as of the Closing Date all of their
right, title and interest in and to the following:
(a) the Trust Student Loans, and all obligations of the Obligors
thereunder including all moneys accrued and paid thereunder on or after the
Cutoff Date and all guaranties and other rights relating to the Trust Student
Loans;
(b) the Servicing Agreement, including the right of the Issuer to cause
the Servicer to purchase Trust Student Loans from the Issuer under circumstances
described therein;
(c) the Sale Agreement, including the right of the Issuer to cause the
Depositor to repurchase Trust Student Loans from the Issuer under the
circumstances described therein and including the rights of the Depositor under
the Purchase Agreement;
(d) the Purchase Agreement, to the extent that the rights of the Depositor
thereunder have been assigned to the Issuer pursuant to the Sale Agreement,
including the right of the Depositor to cause SLM ECFC to repurchase Trust
Student Loans from the Depositor under the circumstances described in the
Purchase Agreement;
(e) the Administration Agreement, the Interest Rate Cap Agreement and any
agreement representing Eligible Repurchase Obligations between the Trust and an
Eligible Repo Counterparty to be entered into from time to time;
(f) each Guarantee Agreement, including the right of the Issuer to cause
the related Guarantor to make Guarantee Payments in respect of the Trust Student
Loans;
(g) the Trust Accounts and all funds on deposit from time to time in the
Trust Accounts, including the Reserve Account Initial Deposit, the Collection
Account Initial Deposit and the Capitalized Interest Account Initial Deposit, if
any, and all investments and proceeds thereof (including all income thereon);
and
(h) all present and future claims, demands, causes and choses in action in
respect of any or all of the foregoing and all payments on or under and all
proceeds of every kind and
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nature whatsoever in respect of any or all of the foregoing, including all
proceeds of the conversion, voluntary or involuntary, into cash or other liquid
property, all cash proceeds, accounts, accounts receivable, notes, drafts,
acceptances, chattel paper, checks, general intangibles, deposit accounts,
insurance proceeds, condemnation awards, rights to payment of any and every kind
and other forms of obligations and receivables, instruments and other property
which at any time constitute all or part of or are included in the proceeds of
any of the foregoing (collectively, the "Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, to secure
compliance with the provisions of this Indenture, all as provided in this
Indenture.
The Indenture Trustee, as indenture trustee on behalf of the
Noteholders, acknowledges such Grant, accepts the trusts under this Indenture in
accordance with the provisions of this Indenture and agrees to perform its
duties required in this Indenture to the best of its ability to the end that the
interests of the Noteholders may be adequately and effectively protected.
ARTICLE I
Definitions and Usage
SECTION 1.1 Definitions and Usage. Except as otherwise specified
herein or as the context may otherwise require, capitalized terms used but not
otherwise defined herein are defined in Appendix A to this Indenture, which also
contains rules as to usage that shall be applicable herein.
SECTION 1.2 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Indenture
Trustee.
"obligor" on the indenture securities means the Issuer and any other
obligor on the indenture securities.
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All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by Commission rule
have the meaning assigned to them by such definitions.
ARTICLE II
The Notes
SECTION 2.1 Form. The Notes, together with the Indenture Trustee's
certificate of authentication, shall be in substantially the forms set forth in
Exhibit A, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing the Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
The Definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.
The terms of the Notes set forth in Exhibit A are part of the terms
of this Indenture.
Each class of Notes will be represented by interests in a book-entry
note certificate deposited on the Closing Date with Deutsche Bank Trust Company
Americas, as custodian for DTC (the "DTC Custodian"), and registered in the name
of Cede & Co. as initial nominee for DTC.
SECTION 2.2 Execution, Authentication and Delivery. The Notes shall
be executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals who
were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Order authenticate and
deliver Notes for original issue in an aggregate principal amount of
$1,509,560,000. The aggregate principal amount of Notes Outstanding at any time
may not exceed such amount except as provided in Section 2.5.
Each Note shall be dated the date of its authentication. The Class A
Notes shall be issuable as registered notes in minimum denominations of $10,000
and additional increments of $1,000. The Class B Notes shall be issuable as
registered notes in minimum denominations of $100,000 and additional increments
of $1,000.
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No Note shall be entitled to any benefit under this Indenture or be
valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.
SECTION 2.3 Temporary Notes. Pending the preparation of Definitive
Notes, the Issuer may execute, and upon receipt of an Issuer Order the Indenture
Trustee shall authenticate and deliver, temporary Notes which are printed,
lithographed, typewritten, mimeographed or otherwise produced, of the tenor of
the Definitive Notes in lieu of which they are issued and with such variations
not inconsistent with the terms of this Indenture determined to be appropriate
by the Responsible Officer of the Issuer executing the temporary Notes, as
evidenced by his or her execution of such temporary Notes.
If temporary Notes are issued, the Issuer will cause Definitive
Notes to be prepared without unreasonable delay. After the preparation of
Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes
upon surrender of the temporary Notes at the office or agency of the Issuer to
be maintained as provided in Section 3.2, without charge to the Noteholder. Upon
surrender for cancellation of any one or more temporary Notes, the Issuer shall
execute and the Indenture Trustee shall authenticate and deliver in exchange
therefor a like principal amount of Definitive Notes of authorized
denominations. Until so exchanged, the temporary Notes shall in all respects be
entitled to the same benefits under this Indenture as Definitive Notes.
SECTION 2.4 Registration; Registration of Transfer and Exchange. The
Issuer shall cause to be kept a register (the "Note Register") in which, subject
to such reasonable regulations as it may prescribe, the Issuer shall provide for
the registration of Notes and the registration of transfers of Notes. The
Indenture Trustee shall be "Note Registrar" for the purpose of registering Notes
and transfers of Notes as herein provided. Upon any resignation of any Note
Registrar, the Issuer shall promptly appoint a successor or, if it elects not to
make such an appointment, assume the duties of Note Registrar.
If a Person other than the Indenture Trustee is appointed by the
Issuer as Note Registrar, the Issuer shall give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive
Officer thereof as to the names and addresses of the Noteholders and the
principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.2, if
the requirements of Section 8-401(1) of the UCC are met, the Issuer shall
execute, and the Indenture Trustee shall authenticate and the Noteholder shall
obtain from the Indenture Trustee, in the name of the designated transferee or
transferees, one or more new Notes in any authorized denominations and a like
aggregate principal amount.
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At the option of the Noteholder, Notes may be exchanged for other
Notes in any authorized denominations and a like aggregate principal amount,
upon surrender of the Notes to be exchanged at such office or agency. Whenever
any Notes are so surrendered for exchange, the Issuer shall execute, and the
Indenture Trustee shall authenticate and the Noteholder shall obtain from the
Indenture Trustee, the Notes which the Noteholder making the exchange is
entitled to receive.
All Notes issued upon any registration of transfer or exchange of
Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or
exchange shall be duly endorsed by, or be accompanied by a written instrument of
transfer in form satisfactory to the Indenture Trustee duly executed by the
Noteholder thereof or such Noteholder's attorney duly authorized in writing,
with such signature guaranteed by an "eligible guarantor institution" meeting
the requirements of the Note Registrar, which requirements include membership or
participation in Securities Transfer Agent's Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Note Registrar
in addition to, or in substitution for, STAMP, all in accordance with the
Exchange Act.
No service charge shall be made to a Noteholder for any registration
of transfer or exchange of Notes, but the Indenture Trustee may require payment
of a sum sufficient to cover any tax or other governmental charge that may be
imposed in connection with any registration of transfer or exchange of Notes,
other than exchanges pursuant to Section 2.3 or 9.6 not involving any transfer.
The preceding provisions of this Section notwithstanding, the Issuer
shall not be required to make and the Note Registrar need not register transfers
or exchanges of Notes selected for redemption or of any Note for a period of 15
days preceding the due date for any payment with respect to the Note.
Any transfer or assignment of any Note or any interest in any Note
that is not effected pursuant to the provisions of this Indenture, such as a
transfer or assignment not reflected on the Note Register, shall be null and
void and shall not be taken into account by, or be binding upon, the Indenture
Trustee or any other party.
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes. If (i) any
mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee
receives evidence to its satisfaction of the destruction, loss or theft of any
Note, and (ii) there is delivered to the Issuer and the Indenture Trustee such
security or indemnity as may be required by each of them to hold the Issuer and
the Indenture Trustee harmless, then, in the absence of notice to the Issuer,
the Note Registrar or the Indenture Trustee that such Note has been acquired by
a bona fide purchaser, and provided that the requirements of Section 8-405 of
the UCC are met, the Issuer shall execute and upon its request the Indenture
Trustee shall authenticate and deliver, in exchange for or in lieu of any such
mutilated, destroyed, lost or stolen Note, a replacement Note; provided,
however, that if any such destroyed, lost or stolen Note, but not a mutilated
Note, shall have become or within 15 days shall be due and payable, or shall
have been called for
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redemption, instead of issuing a replacement Note, the Issuer may pay such
destroyed, lost or stolen Note when so due or payable or upon the Redemption
Date without surrender thereof. If, after the delivery of such replacement Note
or payment of a destroyed, lost or stolen Note pursuant to the proviso to the
preceding sentence, a bona fide purchaser of the original Note in lieu of which
such replacement Note was issued presents for payment such original Note, the
Issuer and the Indenture Trustee shall be entitled to recover such replacement
Note (or such payment) from the Person to whom it was delivered or any Person
taking such replacement Note from such Person to whom such replacement Note was
delivered or any assignee of such Person, except a bona fide purchaser, and
shall be entitled to recover upon the security or indemnity provided therefor to
the extent of any loss, damage, cost or expense incurred by the Issuer or the
Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section, the
Issuer may require the payment by the Noteholder thereof of a sum sufficient to
cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.6 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of, interest, if any, on
such Note and for all other purposes whatsoever, whether or not such Note be
overdue, and neither the Issuer, the Indenture Trustee nor any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.
SECTION 2.7 Payment of Principal and Interest; Note Interest
Shortfall. (a) The Notes shall accrue interest as provided in the forms of Notes
in Exhibit A and such interest shall be payable on each Distribution Date as
specified therein, subject to Section 3.1. Any installment of interest or
principal, if any, payable on any Note which is punctually paid or duly provided
for by the Issuer on the applicable Distribution Date shall be paid to the
Person in whose name such Note (or one or more Predecessor Notes) is registered
on the applicable Record Date by check mailed first-class, postage prepaid to
such Person's address as it appears on the Note Register on such Record Date,
except that, unless Definitive Notes have been issued pursuant to Section 2.12,
with respect to Notes registered on the Record Date in the name of the nominee
of the applicable Clearing Agency, for the Notes (initially, such nominee to be
Cede & Co.), payment shall be made by wire transfer in immediately available
funds to the account designated by such nominee and except for the final
installment of principal payable with respect
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to such Note on a Distribution Date or on the Note Final Maturity Date for such
Note which shall be payable as provided below. The funds represented by any such
checks returned undelivered shall be held in accordance with Section 3.3.
(a) The principal amount of each class of Notes shall be payable in
installments on each Distribution Date as provided in the forms of Notes set
forth in Exhibit A. Notwithstanding the foregoing, the entire unpaid principal
amount of each class of the Notes shall be due and payable, if not previously
paid, on the Note Final Maturity Date for such class of Notes and on the date on
which an Event of Default shall have occurred and be continuing if the Indenture
Trustee or the Noteholders of the Notes representing at least a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2. All principal payments on the
Notes shall be made pro rata to the specific class of Noteholders entitled
thereto. The Indenture Trustee shall notify the Person in whose name a Note is
registered at the close of business on the Record Date preceding the
Distribution Date on which the Issuer expects that the final installment of
principal of and interest on such Note will be paid. Such notice shall be mailed
or transmitted by facsimile prior to such final Distribution Date and shall
specify that such final installment will be payable only upon presentation and
surrender of such Note and shall specify the place where such Note may be
presented and surrendered for payment of such installment. Notices in connection
with redemptions of Notes shall be mailed to Noteholders as provided in Section
10.2.
(b) If the Issuer defaults in a payment of interest at the applicable Note
Rate on the Notes, the Issuer shall pay the resulting Note Interest Shortfall on
the following Distribution Date as provided in the Administration Agreement.
SECTION 2.8 Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section, except as expressly permitted
by this Indenture. All canceled Notes may be held or disposed of by the
Indenture Trustee in accordance with its standard retention or disposal policy
as in effect at the time, unless the Issuer shall direct by an Issuer Order that
they be returned to it and so long as such Issuer Order is timely and the Notes
have not been previously disposed of by the Indenture Trustee.
SECTION 2.9 Release of Collateral. Subject to Section 11.1 and the
terms of the Basic Documents, the Indenture Trustee shall release property from
the lien of this Indenture only upon receipt of an Issuer Request accompanied by
an Officers' Certificate of the Issuer, an Opinion of Counsel and Independent
Certificates in accordance with TIA Sections 314(c) and 314(d)(1) or an Opinion
of Counsel in lieu of such Independent Certificates to the effect that the TIA
does not require any such Independent Certificates.
SECTION 2.10 Book-Entry Notes. The Notes, upon original issuance,
will be issued in the form of typewritten Notes representing the Book-Entry
Notes, to be delivered to
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The Depository Trust Company, as initial Clearing Agency, by the Issuer, or on
behalf of the Issuer. Such Notes shall initially be registered on the Note
Register in the name of Cede & Co., the nominee of the initial Clearing Agency,
and no Note Owner shall receive a definitive, fully registered note (a
"Definitive Note") representing such Note Owner's interest in such Note, except
as provided in Section 2.12. Unless and until Definitive Notes have been issued
to Note Owners pursuant to Section 2.12:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Note Registrar and the Indenture Trustee, and their
respective directors, officers, employees and agents, may deal with the
applicable Clearing Agency for all purposes (including the payment of principal
of and interest and other amounts on the Notes) as the authorized representative
of the Note Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Indenture, the provisions of this Section
shall control;
(iv) the rights of Note Owners shall be exercised only through the
applicable Clearing Agency and shall be limited to those established by law and
agreements between such Note Owners and the applicable Clearing Agency and/or
the applicable Clearing Agency Participants pursuant to the Note Depository
Agreement; and unless and until Definitive Notes are issued pursuant to Section
2.12, the initial Clearing Agency will make book-entry transfers among the
applicable Clearing Agency Participants and receive and transmit payments of
principal of and interest and other amounts on the Notes to such applicable
Clearing Agency Participants;
(v) whenever this Indenture requires or permits actions to be taken
based upon instructions or directions of Noteholders of Notes evidencing a
specified percentage of the Outstanding Amount of the Notes, the applicable
Clearing Agency shall be deemed to represent such percentage only to the extent
that it has received instructions to such effect from Note Owners and/or
applicable Clearing Agency Participants owning or representing, respectively,
such required percentage of the beneficial interest in the Notes and has
delivered such instructions to the Indenture Trustee; and
(vi) upon acquisition or transfer of a beneficial interest in any
Book-Entry Note by, for or with the assets of, a Benefit Plan, such Note Owner
shall be deemed to have represented that such acquisition or purchase will not
constitute or otherwise result in: (i) in the case of a Benefit Plan subject to
Title I of ERISA or Section 4975 of the Code, a non-exempt prohibited
transaction in violation of Section 406 of ERISA or Section 4975 of the Code
which is not covered by a class or other applicable exemption and (ii) in the
case of a Benefit Plan subject to a substantially similar federal, state, local
or foreign law, a non-exempt violation of such substantially similar law. Any
transfer found to have been made in violation of such deemed representation
shall be null and void and of no effect.
SECTION 2.11 Notices to Clearing Agency. Whenever a notice or other
communication is required under this Indenture to be given to Noteholders,
unless and until Definitive Notes shall have been issued to Note Owners pursuant
to Section 2.12, the Indenture
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Trustee shall give all such notices and communications specified herein to the
applicable Clearing Agency.
SECTION 2.12 Definitive Notes. If (i) the Administrator advises the
Indenture Trustee in writing that a Clearing Agency (a) is closed for business
for a continuous period of 14 days (other than by reason of holiday, statutory
or otherwise), (b) announces an intention to cease business permanently (or does
so and no alternative clearing system acceptable to the Indenture Trustee is
then available), or (c) at any time, is unwilling or unable to continue as, or
ceases to be, a clearing agency registered under all applicable laws, and a
successor clearing agency which is registered as a clearing agency under all
applicable laws is not appointed by the Administrator within 90 days of such
event, (ii) the Administrator at its option advises the Indenture Trustee in
writing that it elects to terminate the book-entry system through that Clearing
Agency or (iii) after the occurrence of an Event of Default, a Servicer Default
or an Administrator Default, Note Owners representing beneficial interests
aggregating at least a majority of the Outstanding Amount of the applicable
Notes advise the applicable Clearing Agency (which shall then notify the
Indenture Trustee) in writing that the continuation of a book-entry system
through such Clearing Agency is no longer in the best interests of such Note
Owners, then the Indenture Trustee shall cause such Clearing Agency to notify
all Note Owners cleared, through such Clearing Agency, of the occurrence of any
such event and of the availability of Definitive Notes to Note Owners requesting
the same. Upon surrender to the Indenture Trustee of the typewritten Notes
representing the Book-Entry Notes by a Clearing Agency, accompanied by
registration instructions, the Issuer shall execute and the Indenture Trustee
shall authenticate the Definitive Notes in accordance with the instructions of
such Clearing Agency, which shall include, without limitation, the identity and
payment instructions for all Noteholders of the applicable Notes. None of the
Issuer, the Note Registrar or the Indenture Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of Definitive
Notes, the Indenture Trustee shall recognize the holders of the Definitive Notes
as Noteholders.
Upon acquisition or transfer of a Definitive Note by, for or with
the assets of, a Benefit Plan, such Note Owner shall be deemed to have
represented that such acquisition or purchase will not constitute or otherwise
result in: (i) in the case of a Benefit Plan subject to Section 406 of ERISA or
Section 4975 of the Code, a non-exempt prohibited transaction in violation of
Section 406 of ERISA or Section 4975 of the Code which is not covered by a class
or other applicable exemption and (ii) in the case of a Benefit Plan subject to
a substantially similar law, a non-exempt violation of such substantially
similar law. Any transfer found to have been made in violation of such deemed
representation shall be null and void and of no effect.
ARTICLE III
Covenants
SECTION 3.1 Payments to Noteholders. The Issuer shall duly and
punctually pay the principal and interest, if any, with respect to the Notes in
accordance with the terms of the Notes and this Indenture. Without limiting the
foregoing, the Issuer shall cause to be distributed to Noteholders in accordance
with the Administration Agreement that portion of the
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amounts on deposit in the Trust Accounts on a Distribution Date (other than any
Eligible Investments deposited therein that will mature on the Business Day
preceding a subsequent Distribution Date) which the Noteholders are entitled to
receive pursuant to Sections 2.7 and 2.8 of the Administration Agreement.
Amounts properly withheld under the Code by any Person from a payment to any
Noteholder of interest and/or principal shall be considered as having been paid
by the Issuer to such Noteholder for all purposes of this Indenture.
SECTION 3.1A Collateral Account. In the event that pursuant to the
terms of the Interest Rate Cap Agreement, the Interest Rate Cap Counterparty is
required to deposit cash or securities as collateral to secure its obligations
("Cap Collateral"), the Indenture Trustee shall establish and maintain an
Eligible Deposit Account in the name of the Indenture Trustee for the benefit of
the Issuer and the Interest Rate Cap Counterparty (an "Interest Rate Cap
Agreement Collateral Account"). All sums on deposit and securities held in any
Interest Rate Cap Agreement Collateral Account shall be used only for the
purposes set forth in the related credit support agreement to be entered into
between the Trust and the Interest Rate Cap Counterparty (a "Credit Support
Agreement"). Amounts on deposit in any Interest Rate Cap Agreement Collateral
Account may be invested in Eligible Investments at the written direction of the
Interest Rate Cap Counterparty and on each Distribution Date, all Investment
Earnings actually received by the Indenture Trustee on amounts on deposit in an
Interest Rate Cap Agreement Collateral Account or on securities held by the
Indenture Trustee as Interest Rate Cap Collateral shall be paid directly to the
Interest Rate Cap Counterparty and not become part of Available Funds in
accordance with the terms of the Credit Support Agreement. All amounts deposited
in an Interest Rate Cap Agreement Collateral Account shall be paid to the Issuer
(and become part of Available Funds on the related Distribution Date) or
returned to the related Interest Rate Cap Counterparty, from time to time, in
accordance with the provisions set forth in the related Credit Support
Agreement.
SECTION 3.2 Maintenance of Office or Agency. The Issuer shall
maintain in the Borough of Manhattan, The City of New York and in Luxembourg, so
long as any of the Notes are listed on the Luxembourg Stock Exchange and the
rules of such exchange so require, or in such other jurisdiction if any of the
Notes are listed on another stock exchange of international standing and the
rules of such other exchange so require, an office or agency where Notes may be
surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints the Indenture Trustee to serve as
its agent for the foregoing purposes. The Issuer shall give prompt written
notice to the Indenture Trustee of the location, and of any change in the
location, of any such office or agency. If at any time the Issuer shall fail to
maintain any such office or agency or shall fail to furnish the Indenture
Trustee with the address thereof, such surrenders, notices and demands may be
made or served at the Corporate Trust Office, and the Issuer hereby appoints the
Indenture Trustee as its agent to receive all such surrenders, notices and
demands.
SECTION 3.3 Money for Payments to be Held in Trust. As provided in
Section 8.2(a) and (b), all payments of amounts due and payable with respect to
any Notes that are to be made from amounts distributed from the Collection
Account or the Reserve Account pursuant to Sections 2.7 and 2.8 of the
Administration Agreement shall be made on behalf of the Issuer by the Indenture
Trustee or by another Paying Agent, and no amounts so distributed from the
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Collection Account for payments to Noteholders shall be paid over to the Issuer
except as provided in this Section.
On or before the Business Day next preceding each Distribution Date
and Redemption Date, the Issuer shall distribute or cause to be distributed to
the Indenture Trustee (or any other Paying Agent) an aggregate sum sufficient to
pay the amounts then becoming due under the Notes, such sum to be held in trust
for the benefit of the Persons entitled thereto and (unless the Paying Agent is
the Indenture Trustee) shall promptly notify the Indenture Trustee of its action
or failure so to act.
The Issuer shall cause each Paying Agent other than the Indenture
Trustee to execute and deliver to the Indenture Trustee an instrument in which
such Paying Agent shall agree with the Indenture Trustee (and if the Indenture
Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of
this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with
respect to the Notes in trust for the benefit of the Persons entitled thereto
until such sums shall be paid to such Persons or otherwise disposed of as herein
provided and pay such sums to such Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by the Issuer
of which it has actual knowledge (or any other obligor upon the Notes) in the
making of any payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any such default, upon
the written request of the Indenture Trustee, forthwith pay to the Indenture
Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to the
Indenture Trustee all sums held by it in trust for the payments due under the
Notes if at any time it ceases to meet the standards required to be met by a
Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect to the
withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable reporting
requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such Paying Agent; and
upon such payment by any Paying Agent to the Indenture Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds, any
money held by the Indenture Trustee or any Paying Agent in trust for the payment
of any amount due with respect to any Note and remaining unclaimed for two years
after such amount has become due and
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payable shall be discharged from such trust and be paid to the Issuer on Issuer
Request or if the Issuer has been terminated to the Depositor upon its written
request; and the Noteholder thereof shall thereafter, as an unsecured general
creditor, look only to the Issuer for payment thereof (but only to the extent of
the amounts so paid to the Issuer), and all liability of the Indenture Trustee
or such Paying Agent with respect to such trust money shall thereupon cease;
provided, however, that the Indenture Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense and direction of the
Issuer cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in The City of New York and in Luxembourg, so long as any of the Notes are
listed on the Luxembourg Stock Exchange and the rules of such Exchange so
require, or in such other jurisdiction if any of the Notes are listed on another
stock exchange of international standing and the rules of such other exchange so
require, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Issuer. The Indenture Trustee shall also adopt and employ, at the expense
of the Issuer, any other reasonable means of notification of such repayment
(including mailing notice of such repayment to Noteholders whose Notes have been
called but have not been surrendered for redemption or whose right to or
interest in moneys due and payable but not claimed is determinable from the
records of the Indenture Trustee or of any Paying Agent, at the last address of
record for each such Noteholder).
SECTION 3.4 Existence. The Issuer shall keep in full effect its
existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States of
America, in which case the Issuer shall keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and shall
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Indenture Trust Estate.
SECTION 3.5 Protection of Indenture Trust Estate. The Issuer will
from time to time execute and deliver all such supplements and amendments
hereto, all such financing statements and continuation statements and will take
such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest (and the
priority thereof) of this Indenture or carry out more effectively the purposes
hereof;
(ii) perfect, publish notice of or protect the validity of any grant
made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
(iv) preserve and defend title to the Indenture Trust Estate and the
rights of the Indenture Trustee and the Noteholders in such Indenture Trust
Estate against the claims of all persons and parties.
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The Issuer hereby designates the Indenture Trustee its agent and
attorney-in-fact to execute any financing statement, continuation statement or
other instrument required to be executed pursuant to this Section.
SECTION 3.6 Opinions as to Indenture Trust Estate. (a) On the
Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion of
Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording and filing of this Indenture as is
necessary to perfect and make effective the lien and security interest of this
Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.
(b) On or before December 31 in each calendar year, beginning in 2004, the
Issuer shall furnish to the Indenture Trustee an Opinion of Counsel either
stating that, in the opinion of such counsel, such action has been taken with
respect to the recording, filing, re-recording and refiling of this Indenture
and any indentures supplemental hereto as is necessary to maintain the lien and
security interest created by this Indenture and relating the details of such
action or stating that in the opinion of such counsel no such action is
necessary to maintain such lien and security interest. Such Opinion of Counsel
shall also describe the recording, filing, recording and refiling of this
Indenture and any indentures supplemental hereto that will, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture until December 31 in the following calendar year.
SECTION 3.7 Performance of Obligations; Servicing of Trust Student
Loans. (a) The Issuer will not take any action and will use its best efforts not
to permit any action to be taken by others that would release any Person from
any of such Person's material covenants or obligations under any instrument or
agreement included in the Indenture Trust Estate or that would result in the
amendment, hypothecation, subordination, termination or discharge of, or impair
the validity or effectiveness of, any such instrument or agreement, except as
expressly provided in this Indenture, any other Basic Document or such other
instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in performing
its duties under this Indenture, and any performance of such duties by a Person
identified to the Indenture Trustee in an Officers' Certificate of the Issuer
shall be deemed to be action taken by the Issuer; provided, however, the Issuer
shall not be liable for any acts of Persons with whom the Issuer has contracted
with reasonable care. Initially, the Issuer has contracted with the Servicer and
the Administrator to assist the Issuer in performing its duties under this
Indenture. The Issuer shall give written notice to the Indenture Trustee and
each Rating Agency of any such contract with any other Person.
(b) The Issuer shall punctually perform and observe all of its obligations
and agreements contained in this Indenture, the other Basic Documents and the
instruments and agreements included in the Indenture Trust Estate, including
filing or causing to be filed all UCC financing statements and continuation
statements prepared by the Issuer and required to be filed by the terms of this
Indenture and the Administration Agreement in accordance with and within the
time periods provided for herein and therein. Except as otherwise expressly
provided therein, the Issuer shall not waive, amend, modify, supplement or
terminate any Basic Document or any provision thereof without the consent of the
Indenture Trustee or the Noteholders of at least a
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majority of the Outstanding Amount of the Notes; provided, for the avoidance of
doubt, that a transfer or assignment by the Interest Rate Cap Counterparty of
any of its interests or obligations in accordance with the requirements of
Section 7 of the Interest Rate Cap Agreement (including the requirement that
each Rating Agency then rating the Notes issue written acknowledgment that,
notwithstanding such transfer or assignment, the then-current rating of the
Notes will not be downgraded) shall not constitute a waiver, amendment,
modification, supplement or termination of the Interest Rate Cap Agreement or
any provision thereof and shall not require the consent of the Indenture Trustee
or the Noteholders of at least a majority of the Outstanding Amount of the
Notes. The Issuer shall give written notice to each Rating Agency of any waiver,
amendment, modification, supplement or termination that requires the consent of
the Indenture Trustee or the Noteholders of at least a majority of the
Outstanding Amount of the Notes.
(d) If a Responsible Officer of the Issuer shall have knowledge of the
occurrence of a Servicer Default or an Administrator Default under the Servicing
Agreement or the Administration Agreement, respectively, the Issuer shall
promptly notify the Indenture Trustee and the Rating Agencies thereof, and shall
specify in such notice the action, if any, the Issuer is taking with respect to
such default. If a Servicer Default shall arise from the failure of the Servicer
to perform any of its duties or obligations under the Servicing Agreement, or an
Administrator Default shall arise from the failure of the Administrator to
perform any of its duties or obligations under the Administration Agreement, as
the case may be, with respect to the Trust Student Loans, the Issuer shall take
all reasonable steps available to it to enforce its rights under the Basic
Documents in respect of such failure.
(e) As promptly as possible after the giving of notice of termination to
the Servicer of the Servicer's rights and powers, pursuant to Section 5.1 of the
Servicing Agreement, or to the Administrator of the Administrator's rights and
powers, pursuant to Section 5.1 of the Administration Agreement, the Issuer
shall appoint a successor servicer (the "Successor Servicer") or a successor
administrator (the "Successor Administrator"), respectively, and such Successor
Servicer or Successor Administrator, as the case may be, shall accept its
appointment by a written assumption in a form acceptable to the Indenture
Trustee. In the event that a Successor Servicer or Successor Administrator has
not been appointed and accepted its appointment at the time when the Servicer or
Administrator, as the case may be, ceases to act as Servicer or Administrator,
respectively, the Indenture Trustee without further action shall automatically
be appointed the Successor Servicer or Successor Administrator, as the case may
be. The Indenture Trustee may resign as the Successor Servicer or the Successor
Administrator by giving written notice of resignation to the Issuer and in such
event will be released from such duties and obligations, such release not to be
effective until the date a new servicer or a new administrator enters into an
agreement with the Issuer as provided below; provided, however, that nothing
herein shall require or permit the Indenture Trustee to act as Servicer, or
otherwise service the Trust Student Loans, in violation of the Higher Education
Act. Upon delivery of any such notice to the Issuer, the Issuer shall obtain a
new servicer as the Successor Servicer under the Servicing Agreement or a new
administrator as the Successor Administrator under the Administration Agreement,
as the case may be. Any Successor Servicer or Successor Administrator, other
than the Indenture Trustee, shall (i) be an established institution (A) that
satisfies any requirements of the Higher Education Act applicable to servicers
and (B) whose regular business includes the servicing or administration of
student loans and (ii) enter into a servicing agreement or an administration
agreement, respectively, with the Issuer having
14
substantially the same provisions as the provisions of the Servicing Agreement
and the Administration Agreement, as applicable. If within 30 days after the
delivery of the notice referred to above, the Issuer shall not have obtained
such a new servicer or new administrator, as the case may be, the Indenture
Trustee may appoint, or may petition a court of competent jurisdiction to
appoint, a Successor Servicer or Successor Administrator; provided, however,
that such right to appoint or to petition for the appointment of any such
successor shall in no event relieve the Indenture Trustee from any obligations
otherwise imposed on it under the Basic Documents until such successor has in
fact assumed such appointment. In connection with any such appointment, the
Indenture Trustee may make such arrangements for the compensation of such
successor as it and such successor shall agree, subject to the limitations set
forth below and in the Servicing Agreement or Administration Agreement, as
applicable, and in accordance with Section 5.2 of the Servicing Agreement and
Section 5.2 of the Administration Agreement, the Issuer shall enter into an
agreement with such successor for the servicing or administration of the Trust
Student Loans (such agreement to be in form and substance satisfactory to the
Indenture Trustee). If the Indenture Trustee shall succeed as provided herein to
the Servicer's duties as Servicer with respect to the Trust Student Loans, or
the Administrator's duties with respect to the Issuer and the Trust Student
Loans, as the case may be, it shall do so in its individual capacity and not in
its capacity as Indenture Trustee and, accordingly, the provisions of Article VI
hereof shall be inapplicable to the Indenture Trustee in its duties as the
successor to the Servicer or the Administrator, as the case may be, and the
servicing or administration of the Trust Student Loans. In case the Indenture
Trustee shall become successor to the Servicer or the Administrator, the
Indenture Trustee shall be entitled to appoint as Servicer or as Administrator,
as the case may be, any one of its Affiliates, provided that such appointment
shall not affect or alter in any way the liability of the Indenture Trustee as
Successor Servicer or Successor Administrator, respectively, in accordance with
the terms hereof.
(f) Upon any termination of the Servicer's rights and powers pursuant to
the Servicing Agreement, or any termination of the Administrator's rights and
powers pursuant to the Administration Agreement, as the case may be, the Issuer
shall promptly notify the Indenture Trustee and each Rating Agency. As soon as a
Successor Servicer or a Successor Administrator is appointed, the Issuer shall
notify the Indenture Trustee and each Rating Agency of such appointment,
specifying in such notice the name and address of such Successor Servicer or
such Successor Administrator.
(g) Without derogating from the absolute nature of the assignment granted
to the Indenture Trustee under this Indenture or the rights of the Indenture
Trustee hereunder, the Issuer agrees that it will not, without the prior written
consent of the Indenture Trustee or the Noteholders of at least a majority in
Outstanding Amount of the Notes, amend, modify, waive, supplement, terminate or
surrender, or agree to any amendment, modification, supplement, termination,
waiver or surrender of, the terms of any Collateral or the Basic Documents,
except to the extent otherwise provided in the Basic Documents, or waive timely
performance or observance by the Servicer, the Administrator, the Depositor, the
Excess Distribution Certificateholder, SLM ECFC, the Issuer, the Eligible Lender
Trustee or the Interest Rate Cap Counterparty under the Basic Documents;
provided, however, that no such amendment shall (i) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, distributions that
are required to be made for the benefit of the Noteholders, or (ii) reduce the
aforesaid percentage of the Notes which are required to consent to any such
amendment, without
15
the consent of the Noteholders of all the Outstanding Notes. If any such
amendment, modification, supplement or waiver shall be so consented to by the
Indenture Trustee or such Noteholders, the Issuer shall give written notice
thereof to each Rating Agency and agrees, promptly following a request by the
Indenture Trustee to do so, to execute and deliver, in its own name and at its
own expense, such agreements, instruments, consents and other documents as the
Indenture Trustee may deem necessary or appropriate in the circumstances.
SECTION 3.8 Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by this Indenture or any other
Basic Document, sell, transfer, exchange or otherwise dispose of any of the
properties or assets of the Issuer, including those included in the Indenture
Trust Estate, unless directed to do so by the Indenture Trustee;
(ii) claim any credit on, or make any deduction from the principal
or interest payable in respect of, the Notes (other than amounts properly
withheld from such payments under the Code or applicable state law) or assert
any claim against any present or former Noteholder by reason of the payment of
the taxes levied or assessed upon any part of the Indenture Trust Estate;
(iii) (A) permit the validity or effectiveness of this Indenture to
be impaired, or permit the lien of this Indenture to be amended, hypothecated,
subordinated, terminated or discharged, or permit any Person to be released from
any covenants or obligations with respect to the Notes under this Indenture
except as may be expressly permitted hereby, (B) permit any lien, charge,
excise, claim, security interest, mortgage or other encumbrance (other than the
lien of this Indenture) to be created on or extend to or otherwise arise upon or
burden the Indenture Trust Estate or any part thereof or any interest therein or
the proceeds thereof (other than tax liens and other liens that arise by
operation of law, and other than as expressly permitted by the Basic Documents)
or (C) permit the lien of this Indenture not to constitute a valid first
priority (other than with respect to any such tax or other lien) security
interest in the Indenture Trust Estate; or
(iv) enter into any amendment to the Interest Rate Cap Agreement to
cure any ambiguity in, or to correct or supplement any provision of the Interest
Rate Cap Agreement, unless the Issuer has determined, and the Indenture Trustee
has agreed in writing at the written direction of the Issuer, that the amendment
will not materially adversely affect the interests of the Noteholders and
provided that the Issuer has provided reasonable notice to the Rating Agencies
of such amendment and the Rating Agency Condition is satisfied.
SECTION 3.9 Annual Statement as to Compliance. The Issuer will
deliver to the Indenture Trustee and each Rating Agency, within 90 days after
the end of each fiscal year of the Issuer (commencing with the fiscal year
ending December 31, 2004), an Officers' Certificate of the Issuer stating that:
16
(i) a review of the activities of the Issuer during such year and of
performance under this Indenture has been made under such Authorized Officers'
supervision; and
(ii) to the best of such Authorized Officers' knowledge, based on
such review, the Issuer has complied with all conditions and covenants under
this Indenture throughout such year, or, if there has been a default in the
compliance of any such condition or covenant, specifying each such default known
to such Authorized Officers and the nature and status thereof.
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms.
(a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by or surviving
such consolidation or merger shall be a Person organized and existing under the
laws of the United States of America or any State and shall expressly assume, by
an indenture supplemental hereto, executed and delivered to the Indenture
Trustee, in form satisfactory to the Indenture Trustee, the due and punctual
payment of the principal of, and interest, if any, on all Notes and the
performance or observance of every agreement and covenant of this Indenture and
the other Basic Documents on the part of the Issuer to be performed or observed,
all as provided herein;
(ii) immediately after giving effect to such transaction, no Default
shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel (and shall
have delivered copies thereof to the Indenture Trustee) to the effect that such
transaction will not have any material adverse Federal or Delaware state tax
consequence to the Issuer or any Noteholder;
(v) any action as is necessary to maintain the lien and security
interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an
Officers' Certificate of the Issuer and an Opinion of Counsel each stating that
such consolidation or merger and such supplemental indenture comply with this
Article III and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required by the
Exchange Act).
(b) The Issuer shall not convey or transfer all or substantially all of
its properties or assets, including those included in the Indenture Trust
Estate, to any Person, unless:
(i) the Person that acquires by conveyance or transfer the
properties and assets of the Issuer the conveyance or transfer of which is
hereby restricted shall (A) be a United States citizen or a Person organized and
existing under the laws of the United States of America or any State, (B)
expressly assume, by an indenture supplemental hereto, executed and delivered
17
to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the due
and punctual payment of the principal of, and interest, if any, on all Notes and
the performance or observance of every agreement and covenant of this Indenture
on the part of the Issuer to be performed or observed, all as provided herein,
(C) expressly agree by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and subordinate
to the rights of Noteholders, (D) unless otherwise provided in such supplemental
indenture, expressly agree to indemnify, defend and hold harmless the Issuer
against and from any loss, liability or expense arising under or related to this
Indenture and the Notes and (E) expressly agree by means of such supplemental
indenture that such Person (or if a group of Persons, then one specified Person)
shall make all filings with the Commission (and any other appropriate Person)
required by the Exchange Act in connection with the Notes;
(ii) immediately after giving effect to such transaction, no Default
shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied with
respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel (and shall
have delivered copies thereof to the Indenture Trustee) to the effect that such
transaction will not have any material adverse Federal or Delaware state tax
consequence to the Issuer or any Noteholder;
(v) any action as is necessary to maintain the lien and security
interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture Trustee an
Officers' Certificate of the Issuer and an Opinion of Counsel each stating that
such conveyance or transfer and such supplemental indenture comply with this
Article III and that all conditions precedent herein provided for relating to
such transaction have been complied with (including any filing required by the
Exchange Act).
SECTION 3.11 Successor or Transferee. (a) Upon any consolidation or
merger of the Issuer in accordance with Section 3.10(a), the Person formed by or
surviving such consolidation or merger (if other than the Issuer) shall succeed
to, and be substituted for, and may exercise every right and power of, the
Issuer under this Indenture with the same effect as if such Person had been
named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties of the
Issuer pursuant to Section 3.10(b), SLM Student Loan Trust 2004-7 will be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes immediately upon
the delivery by the Issuer of written notice to the Indenture Trustee stating
that SLM Student Loan Trust 2004-7 is to be so released.
SECTION 3.12 No Other Business. The Issuer shall not engage in any
business other than financing, purchasing, owning, selling and managing the
Trust Student Loans and the other assets of the Issuer and related proceeds in
the manner contemplated by this Indenture and the other Basic Documents and
activities incidental thereto.
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SECTION 3.13 No Borrowing. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.
SECTION 3.14 Obligations of Servicer and Administrator. The Issuer
shall cause the Servicer to comply with Sections 3.1, 3.2 and 3.3 of the
Administration Agreement and Section 3.7 of the Servicing Agreement and the
Administrator to comply with Sections 2.11, 3.1, 3.2 and 3.3 of the
Administration Agreement.
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities.
Except as contemplated by this Indenture and the other Basic Documents, the
Issuer shall not make any loan or advance or credit to, or guarantee (directly
or indirectly or by an instrument having the effect of assuring another's
payment or performance on any obligation or capability of so doing or
otherwise), endorse or otherwise become contingently liable, directly or
indirectly, in connection with the obligations, stocks or dividends of, or own,
purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.
SECTION 3.16 Capital Expenditures. The Issuer shall not make any
expenditure (by long-term or operating lease or otherwise) for capital assets
(either realty or personalty).
SECTION 3.17 Restricted Payments. The Issuer shall not, directly or
indirectly, (i) pay any dividend or make any distribution (by reduction of
capital or otherwise), whether in cash, property, securities or a combination
thereof, to the Eligible Lender Trustee or any owner of a beneficial interest in
the Issuer or otherwise with respect to any ownership or equity interest or
security in or of the Issuer or to the Servicer or the Administrator, (ii)
redeem, purchase, retire or otherwise acquire for value any such ownership or
equity interest or security or (iii) set aside or otherwise segregate any
amounts for any such purpose; provided, however, that the Issuer may make, or
cause to be made, distributions to the Servicer, the Eligible Lender Trustee,
the Indenture Trustee, the Noteholders, the Interest Rate Cap Counterparty, the
Administrator, the Depositor and the Excess Distribution Certificateholder as
contemplated by, and to the extent funds are available for such purpose under,
this Indenture and the other Basic Documents. The Issuer will not, directly or
indirectly, make payments to or distributions from the Collection Account except
in accordance with this Indenture and the other Basic Documents.
SECTION 3.18 Notice of Events of Default. The Issuer shall give the
Indenture Trustee, the Rating Agencies and the Interest Rate Cap Counterparty
prompt written notice of each Event of Default hereunder. The Issuer shall give
the Indenture Trustee and the Rating Agencies prompt written notice of each
default on the part of (i) the Depositor of its obligations under the Sale
Agreement, (ii) SLM ECFC of its obligations under the Purchase Agreement, (iii)
the Servicer of its obligations under the Servicing Agreement, or (iv) the
Administrator of its obligations under the Administration Agreement. In
addition, the Issuer shall deliver to the Indenture Trustee, each Rating Agency
and the Interest Rate Cap Counterparty, within five days after the occurrence
thereof, written notice in the form of an Officers' Certificate of the Issuer of
any event which with the giving of notice and the lapse of time would become an
Event of
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Default under Section 5.1(iii), its status and what action the Issuer is taking
or proposes to take with respect thereto.
SECTION 3.19 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1 Satisfaction and Discharge of Indenture. This Indenture
shall cease to be of further effect with respect to the Notes except as to (i)
rights of registration of transfer and exchange, (ii) substitution of mutilated,
destroyed, lost or stolen Notes, (iii) rights of Noteholders to receive payments
of principal thereof and interest thereon, (iv) Sections 3.3, 3.4, 3.5, 3.8,
3.10, 3.12 and 3.13, (v) the rights, obligations and immunities of the Indenture
Trustee hereunder (including, without limitation, the rights of the Indenture
Trustee under Section 6.7 and the obligations of the Indenture Trustee under
Section 4.2) and (vi) the rights of Noteholders as beneficiaries hereof with
respect to the property so deposited with the Indenture Trustee payable to all
or any of them, and the Indenture Trustee, on demand of and at the expense of
the Issuer, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture with respect to the Notes, when:
(a) either
(1) all Notes theretofore authenticated and delivered (other than
(i) Notes that have been destroyed, lost or stolen and that have been replaced
or paid as provided in Section 2.5 and (ii) Notes for whose payment money has
theretofore been deposited in trust or segregated and held in trust by the
Issuer and thereafter repaid to the Issuer or discharged from such trust, as
provided in Section 3.3) have been delivered to the Indenture Trustee for
cancellation; or
(2) all Notes not theretofore delivered to the Indenture Trustee for
cancellation
(i) have become due and payable,
(ii) will become due and payable at their respective Note Final
Maturity Date, within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Indenture Trustee for the giving of notice of
redemption by the Indenture Trustee in the name, and at the expense, of the
Issuer, and the Issuer, in the case of (i), (ii) or (iii) above, has irrevocably
deposited or caused to be irrevocably deposited with the Indenture Trustee cash
or direct obligations of or obligations guaranteed by the United States of
America (which will mature prior to the date such amounts are payable), in trust
for such purpose, in an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to the Indenture Trustee
for cancellation when due to the Note Final Maturity Date;
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(b) the Issuer has paid or caused to be paid all other sums payable
hereunder by the Issuer; and
(c) the Issuer has delivered to the Indenture Trustee an Officers'
Certificate of the Issuer, an Opinion of Counsel and (if required by the TIA or
the Indenture Trustee) an Independent Certificate from a firm of certified
public accountants, each meeting the applicable requirements of Section 11.1(a)
and, subject to Section 11.2, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
SECTION 4.2 Application of Trust Money. All moneys deposited with
the Indenture Trustee pursuant to Section 4.1 hereof shall be held in trust and
applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Noteholders of the particular Notes for
the payment or redemption of which such moneys have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and
interest; but such moneys need not be segregated from other funds except to the
extent required herein or in the Administration Agreement or required by law.
SECTION 4.3 Repayment of Moneys Held by Paying Agent. In connection
with the satisfaction and discharge of this Indenture with respect to the Notes,
all moneys then held by any Paying Agent other than the Indenture Trustee under
the provisions of this Indenture with respect to such Notes shall, upon demand
of the Issuer, be paid to the Indenture Trustee to be held and applied according
to Section 3.3 and thereupon such Paying Agent shall be released from all
further liability with respect to such moneys.
SECTION 4.4 Auction of Trust Student Loans. On the date (the "Trust
Auction Date") that is three Business Days prior to the Distribution Date
immediately following the end of the first Collection Period when the Pool
Balance is equal to 10% or less of the initial Pool Balance, any Trust Student
Loans remaining in the Trust shall be offered for sale by the Indenture Trustee
unless the Servicer has exercised its option to purchase the Trust Estate as
described in Section 6.1(a) of the Administration Agreement with respect to such
Distribution Date. The Servicer will be deemed to have waived such option if it
fails to notify the Eligible Lender Trustee and the Indenture Trustee of its
exercise thereof in writing prior to the Indenture Trustee's acceptance of a bid
to purchase such Trust Student Loans; provided, however, that there shall be no
such offer for sale if the Indenture Trustee fails to provide notice to the
Servicer in accordance with this Section 4.4. The Indenture Trustee shall
provide written notice to the Servicer of any such offer for sale at least 5
Business Days in advance of the Trust Auction Date. The Indenture Trustee shall
permit the Servicer or any of its Affiliates including SLM ECFC to offer bids
only if the Pool Balance as of the applicable Trust Auction Date is equal to 10%
or less of the Initial Pool Balance and such bid does not exceed the fair market
value of the Trust Student Loans as of the Trust Auction Date. If at least two
bids are received, the Indenture Trustee shall solicit and resolicit new bids
from all participating bidders until only one bid remains or the remaining
bidders decline to resubmit bids. The Indenture Trustee shall accept the highest
of such remaining bids if it is equal to or in excess of both the Minimum
Purchase Amount and the fair market value of such Trust Student Loans as of the
end of the Collection Period immediately preceding the Trust Auction Date. If at
least two bids are not received or the
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highest bid after the resolicitation process is completed is not equal to or in
excess of the higher of the Minimum Purchase Amount and the fair market value of
the Trust Student Loans, the Indenture Trustee shall not consummate such sale.
The Indenture Trustee may consult, and, at the direction of the Depositor, shall
consult, with a financial advisor, including an underwriter of the Notes or the
Administrator, to determine if the fair market value of the Trust Student Loans
has been offered. The proceeds of any such sale will be paid at the time set
forth in Section 2.6 of the Administration Agreement and applied in the order of
priority set forth in Section 5.4(b). If the sale is not consummated in
accordance with the foregoing, the Indenture Trustee may, but shall not be under
any obligation to, solicit bids for sale of the Trust Student Loans with respect
to future Distribution Dates upon terms similar to those described above,
including the Servicer's waiver of its option to purchase the Trust Estate in
accordance with Section 6.1(a) of the Administration Agreement with respect to
each such future Distribution Date.
ARTICLE V
Remedies
SECTION 5.1 Events of Default. "Event of Default," wherever used
herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) default in the payment of any interest on any Note when the same
becomes due and payable, and such default shall continue for a period of five
days; or
(ii) default in the payment of the principal of any Note when the
same becomes due and payable on the related Note Final Maturity Date; or
(iii) default in the observance or performance of any covenant or
agreement of the Issuer made in this Indenture (other than a covenant or
agreement, a default in the observance or performance of which is elsewhere in
this Section specifically dealt with), or any representation or warranty of the
Issuer made in this Indenture or in any certificate or other writing having been
incorrect in any material respect as of the time when made, such default or
breach having a material adverse effect on the holders of the Notes, and such
default or breach shall continue or not be cured, or the circumstance or
condition in respect of which such misrepresentation or warranty was incorrect
shall not have been eliminated or otherwise cured, for a period of 30 days after
there shall have been given, by registered or certified mail, to the Issuer by
the Indenture Trustee or to the Issuer and the Indenture Trustee by the
Noteholders of at least 25% of the Outstanding Amount of the Notes, a written
notice specifying such default or incorrect representation or warranty and
requiring it to be remedied and stating that such notice is a notice of Default
hereunder; or
(iv) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of the Issuer or any substantial part of
the Indenture Trust Estate in an involuntary case under any applicable Federal
or state bankruptcy, insolvency or other similar law now or hereafter in effect,
or appointing a receiver, liquidator, assignee, custodian, trustee,
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sequestrator or similar official of the Issuer or for any substantial part of
the Indenture Trust Estate, or ordering the winding-up or liquidation of the
Issuer's affairs, and such decree or order shall remain unstayed and in effect
for a period of 60 consecutive days; or
(v) the commencement by the Issuer of a voluntary case under any
applicable Federal or state bankruptcy, insolvency or other similar law now or
hereafter in effect, or the consent by the Issuer to the entry of an order for
relief in an involuntary case under any such law, or the consent by the Issuer
to the appointment or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Issuer or for any
substantial part of the Indenture Trust Estate, or the making by the Issuer of
any general assignment for the benefit of creditors, or the failure by the
Issuer generally to pay its debts as such debts become due, or the taking of
action by the Issuer in furtherance of any of the foregoing.
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment. If
an Event of Default should occur and be continuing, then and in every such case
the Indenture Trustee or the Noteholders representing at least a majority of the
Outstanding Amount of the Notes may declare all the Notes to be immediately due
and payable, by a notice in writing to the Issuer (and to the Indenture Trustee
if given by Noteholders), and upon any such declaration the unpaid principal
amount of such Notes, together with accrued and unpaid interest thereon through
the date of acceleration, shall become immediately due and payable, subject,
however, to Section 5.4 of this Indenture.
At any time after such declaration of acceleration of maturity has
been made and before a judgment or decree for payment of the money due has been
obtained by the Indenture Trustee as hereinafter in this Article V provided, the
Noteholders of Notes representing at least a majority of the Outstanding Amount
of the Notes, by written notice to the Issuer and the Indenture Trustee, may
rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture Trustee a
sum sufficient to pay:
(a) all payments of principal of and interest on all Notes and
all other amounts that would then be due hereunder or upon such
Notes if the Event of Default giving rise to such acceleration had
not occurred; and
(b) all sums paid or advanced by the Indenture Trustee
hereunder and the reasonable compensation, expenses, disbursements
and advances of the Indenture Trustee and its agents and counsel;
and
(ii) all Events of Default, other than the nonpayment of the
principal of the Notes that has become due solely by such acceleration, have
been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or impair any
right consequent thereto.
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SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee. The Issuer covenants that if (i) default is made in the
payment of any interest on any Note when the same becomes due and payable, and
such default continues for a period of five days, or (ii) default is made in the
payment of the principal of any Note when the same becomes due and payable at
the related Note Final Maturity Date, the Issuer shall, upon demand of the
Indenture Trustee, pay to it, for the benefit of the Noteholders, the whole
amount then due and payable on such Notes for principal and interest, with
interest upon the overdue principal, and, to the extent payment at such rate of
interest shall be legally enforceable, upon overdue installments of interest, at
the rate specified in Section 2.7 and in addition thereto such further amount as
shall be sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.
(a) In case the Issuer shall fail forthwith to pay such amounts upon such
demand, the Indenture Trustee, in its own name and as trustee of an express
trust, may institute a Proceeding for the collection of the sums so due and
unpaid, and may prosecute such Proceeding to judgment or final decree, and may
enforce the same against the Issuer or other obligor upon such Notes and collect
in the manner provided by law out of the property of the Issuer or other obligor
upon such Notes, wherever situated, the moneys adjudged or decreed to be
payable.
(b) If an Event of Default occurs and is continuing, the Indenture Trustee
may, as more particularly provided in Section 5.4, in its discretion, proceed to
protect and enforce its rights and the rights of the Noteholders by such
appropriate Proceedings as the Indenture Trustee shall deem most effective to
protect and enforce any such rights, whether for the specific enforcement of any
covenant or agreement in this Indenture or in aid of the exercise of any power
granted herein, or to enforce any other proper remedy or legal or equitable
right vested in the Indenture Trustee by this Indenture or by law.
(c) In case there shall be pending, relative to the Issuer or any other
obligor upon the Notes or any Person having or claiming an ownership interest in
the Indenture Trust Estate, Proceedings under Title 11 of the United States Code
or any other applicable Federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or reorganization,
liquidator, sequestrator or similar official shall have been appointed for or
taken possession of the Issuer or its property or such other obligor or Person,
or in case of any other, comparable judicial Proceedings relative to the Issuer
or other obligor upon the Notes, or to the creditors or property of the Issuer
or such other obligor, the Indenture Trustee, irrespective of whether the
principal of any Notes shall then be due and payable, as therein expressed or by
declaration or otherwise and irrespective of whether the Indenture Trustee shall
have made any demand pursuant to the provisions of this Section, shall be
entitled and empowered, by intervention in such proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of
principal and interest owing and unpaid in respect of the Notes and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Indenture Trustee (including any claim for reasonable compensation
to the Indenture Trustee and each predecessor Indenture Trustee, and their
respective agents, attorneys and counsel, and for reimbursement of all expenses
and liabilities incurred, and all advances made, by the Indenture Trustee and
each
24
predecessor Indenture Trustee, except as a result of negligence or bad faith)
and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote on
behalf of the Noteholders in any election of a trustee, a standby trustee or
Person performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute all amounts received with
respect to the claims of the Noteholders and the Indenture Trustee on their
behalf; and
(iv) to file such proofs of claim and other papers or documents as
may be necessary or advisable in order to have the claims of the Indenture
Trustee, the Interest Rate Cap Counterparty or the Noteholders allowed in any
judicial proceedings relative to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar
official in any such Proceeding is hereby authorized by each of such Noteholders
to make payments to the Indenture Trustee, and, in the event that the Indenture
Trustee shall consent to the making of payments directly to such Noteholders to
pay to the Indenture Trustee such amounts as shall be sufficient to cover
reasonable compensation to the Indenture Trustee, each predecessor Indenture
Trustee and their respective agents, attorneys and counsel, and all other
expenses and liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee except as a result of negligence
or bad faith.
(d) Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or vote for or accept or adopt on behalf of
any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Noteholder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
(e) All rights of action and of asserting claims under this Indenture, or
under any of the Notes, may be enforced by the Indenture Trustee without the
possession of any of the Notes or the production thereof in any trial or other
Proceedings relative thereto, and any such action or Proceedings instituted by
the Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Noteholders.
(f) In any Proceedings brought by the Indenture Trustee (and also any
Proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders, and it shall not be necessary to make any
Noteholder a party to any such Proceedings.
SECTION 5.4 Remedies; Priorities. If an Event of Default shall have
occurred and be continuing, the Indenture Trustee may do one or more of the
following (subject to Section 5.5):
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(a) (i) institute Proceedings in its own name and as trustee of an express
trust for the collection of all amounts then payable on the Notes or under this
Indenture with respect thereto, whether by declaration or otherwise, enforce any
judgment obtained, and collect from the Issuer and any other obligor upon such
Notes moneys adjudged due;
(i) institute Proceedings from time to time for the complete or
partial foreclosure of this Indenture, with respect to the Indenture Trust
Estate;
(ii) exercise any remedies of a secured party under the UCC with
respect to the Trust Estate and take any other appropriate action to protect and
enforce the rights and remedies of the Indenture Trustee and the Noteholders;
(iii) sell the Indenture Trust Estate or any portion thereof or
rights or interest therein, at one or more public or private sales called and
conducted in any manner permitted by law; and/or
(iv) elect to have the Eligible Lender Trustee maintain ownership of
the Trust Student Loans and continue to apply collections with respect to the
Trust Student Loans as if there had been no declaration of acceleration;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) with respect to the
Class A Notes, unless (A) the Noteholders of 100% of the Outstanding Amount of
the Class A Notes consent thereto, (B) the proceeds of such sale or liquidation
distributable to the Class A Noteholders are sufficient to discharge in full all
amounts then due and unpaid upon such Class A Notes for principal and interest
or (C) the Indenture Trustee determines that the Indenture Trust Estate will not
continue to provide sufficient funds for the payment of principal of and
interest on the Class A Notes as would have become due if the Class A Notes had
not been declared due and payable, and the Indenture Trustee obtains the consent
of Noteholders of 66-2/3% of the Outstanding Amount of the Class A Notes;
provided, further, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) with respect to the
Class A Notes, unless (D) the proceeds of such sale or liquidation distributable
to the Class B Noteholders plus the proceeds of the sale or liquidation of the
Trust Estate distributable to the Class B Noteholders are sufficient to pay to
the Class B Noteholders the Outstanding Amount of the Class B Notes plus accrued
and unpaid interest thereon or (E) after receipt of notice from the Eligible
Lender Trustee that the proceeds of such sale or liquidation distributable to
the Class B Noteholders plus the proceeds of the sale or liquidation of the
Trust Estate distributable to the Class B Noteholders would not be sufficient to
pay to the Class B Noteholders the outstanding principal plus accrued and unpaid
interest thereon, the Class B Noteholders of at least a majority of the
Outstanding Amount of the Class B Notes consent thereto. In determining such
sufficiency or insufficiency with respect to clauses (B), (C), (D) and (E), the
Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Indenture Trust Estate and/or Trust Estate, as applicable, for such purpose.
26
(b) Notwithstanding the provisions of Section 8.2, following the
occurrence and during the continuation of an Event of Default specified in
Section 5.1(i), 5.1(ii), 5.1(iv) or 5.1(v) which has resulted in an acceleration
of the Notes, if the Indenture Trustee collects any money or property, it shall
pay out the money or property (and other amounts including amounts, if any, held
on deposit in each of the Trust Accounts) held as Collateral for the benefit of
the Noteholders, net of liquidation costs associated with the sale of the assets
of the Trust, in the following order:
FIRST: to the Indenture Trustee for amounts due under Section 6.7;
SECOND: to the Servicer for due and unpaid Primary Servicing Fees;
THIRD: to the Administrator, any due and unpaid Administration Fees;
FOURTH: to the Class A Noteholders for amounts due and unpaid on the
Class A Notes for interest, ratably, without preference or priority of any kind
among the classes of Class A Notes, according to the amounts due and payable on
the Class A Notes for such interest;
FIFTH: to the Class A Noteholders for amounts due and unpaid on the
Class A Notes for principal, ratably, without preference or priority of any kind
among the classes of Class A Notes, according to the amounts due and payable on
the Class A Notes for principal;
SIXTH: to the Class B Noteholders for amounts due and unpaid on the
Class B Notes for interest;
SEVENTH: to the Class B Noteholders for amounts due and unpaid on
the Class B Notes for principal;
EIGHTH: to the Servicer, for any unpaid Carryover Servicing Fees;
NINTH: to the Interest Rate Cap Counterparty, the amount of any
termination payment due to the Interest Rate Cap Counterparty by the Issuer
under the Interest Rate Cap Agreement; and
TENTH: to the Issuer, for distribution in accordance with the terms
of the Administration Agreement and the Trust Agreement.
The Indenture Trustee may fix a record date and payment date for any
payment to Noteholders pursuant to this Section. At least 15 days before such
record date, the Indenture Trustee shall mail to each Noteholder and the Issuer
a notice that states the record date, the payment date and the amount to be
paid.
SECTION 5.5 Optional Preservation of the Trust Student Loans. If the
Notes have been declared to be due and payable under Section 5.2 following an
Event of Default and such declaration and its consequences have not been
rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Indenture Trust Estate. It is the desire of the
parties hereto and the Noteholders that there be at all times sufficient funds
for the
27
payment of principal of and interest on the Notes, and the Indenture Trustee
shall take such desire into account when determining whether or not to maintain
possession of the Indenture Trust Estate. In determining whether to maintain
possession of the Indenture Trust Estate, the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Indenture Trust Estate for such purpose.
SECTION 5.6 Limitation of Suits. No Noteholder shall have any right
to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Noteholder has previously given written notice to the
Indenture Trustee of a continuing Event of Default;
(ii) the Noteholders of not less than 25% of the Outstanding Amount
of the Notes have made written request to the Indenture Trustee to institute
such Proceeding in respect of such Event of Default in its own name as Indenture
Trustee hereunder;
(iii) such Noteholder or Noteholders have offered to the Indenture
Trustee reasonable indemnity against the costs, expenses and liabilities to be
incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute such Proceeding;
and
(v) no direction inconsistent with such written request has been
given to the Indenture Trustee during such 60-day period by the Noteholders of
at least a majority of the Outstanding Amount of the Notes;
it being understood and intended that no one or more Noteholders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this indenture to affect, disturb or prejudice the rights of any other
Noteholders or to obtain or to seek to obtain priority or preference over any
other Noteholders or to enforce any right under this Indenture, except in the
manner herein provided.
In the event the Indenture Trustee shall receive conflicting or
inconsistent requests and indemnity from two or more groups of Noteholders, each
representing less than a majority of the Outstanding Amount of the Notes, the
Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
SECTION 5.7 Unconditional Rights of Noteholders to Receive Principal
and Interest. Notwithstanding any other provisions in this Indenture, each
Noteholder shall have the right, which is absolute and unconditional, to receive
payment of the principal of and interest on its Note on or after the respective
due dates thereof expressed in such Note or in this Indenture (or, in the case
of redemption, on or after the Redemption Date) and to institute suit for the
enforcement of any such payment, and such right shall not be impaired without
the consent of such Noteholder.
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SECTION 5.8 Restoration of Rights and Remedies. If the Indenture
Trustee or any Noteholder has instituted any Proceeding to enforce any right or
remedy under this Indenture and such Proceeding has been discontinued or
abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had been
instituted.
SECTION 5.9 Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee or to the Noteholders
is intended to be exclusive of any other right or remedy, and every right and
remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law
or in equity or otherwise. The assertion or employment of any right or remedy
hereunder, or otherwise, shall not prevent the concurrent assertion or
employment of any other appropriate right or remedy.
SECTION 5.10 Delay or Omission Not a Waiver. No delay or omission of
the Indenture Trustee or any Noteholder to exercise any right or remedy accruing
upon any Default shall impair any such right or remedy or constitute a waiver of
any such Default or an acquiescence therein. Every right and remedy given by
this Article V or by law to the Indenture Trustee, the Interest Rate Cap
Counterparty or to the Noteholders may be exercised from time to time, and as
often as may be deemed expedient, by the Indenture Trustee or by the
Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. The Noteholders of at least a
majority of the Outstanding Amount of the Notes shall have the right to direct
the time, method and place of conducting any Proceeding for any remedy available
to the Indenture Trustee with respect to the Notes or exercising any trust or
power conferred on the Indenture Trustee; provided that
(i) such direction shall not be in conflict with any rule of law or
with this Indenture;
(ii) subject to the express terms of Section 5.4, any direction to
the Indenture Trustee to sell or liquidate the Indenture Trust Estate shall be
by the Noteholders of not less than 100% of the Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.5 have been satisfied
and the Indenture Trustee elects to retain the Indenture Trust Estate pursuant
to such Section, then any direction to the Indenture Trustee by Noteholders of
less than 100% of the Outstanding Amount of the Notes to sell or liquidate the
Indenture Trust Estate shall be of no force and effect; and
(iv) the Indenture Trustee may take any other action deemed proper
by the Indenture Trustee that is not inconsistent with such direction;
provided, however, that, subject to Section 6.1, the Indenture Trustee need not
take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
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SECTION 5.12 Waiver of Past Defaults. Prior to the time a judgment
or decree for payment of money due has been obtained as described in Section
5.2, the Noteholders of at least a majority of the Outstanding Amount of the
Notes may waive any past Default and its consequences except a Default (a) in
payment when due of principal of or interest on any of the Notes or (b) in
respect of a covenant or provision hereof which cannot be modified or amended
without the consent of each Noteholder. In the case of any such waiver, the
Issuer, the Indenture Trustee and the Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereto.
SECTION 5.13 Undertaking for Costs. All parties to this Indenture
agree, and each Noteholder by such Noteholder's acceptance of any Note shall be
deemed to have agreed, that any court may in its discretion require, in any suit
for the enforcement of any right or remedy under this Indenture, or in any suit
against the Indenture Trustee for any action taken, suffered or omitted by it as
Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes or (c) any suit Instituted by any Noteholder for
the enforcement of the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture (or,
in the case of redemption, on or after the Redemption Date).
SECTION 5.14 Waiver of Stay or Extension Laws. The Issuer covenants
(to the extent that it may lawfully do so) that it will not at any time insist
upon, or plead or in any manner whatsoever, claim or take the benefit or
advantage of, any stay or extension law wherever enacted, now or at any time
hereafter in force, that may affect the covenants or the performance of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 5.15 Action on Notes. The Indenture Trustee's right to seek
and recover judgment on the Notes or under this Indenture shall not be affected
by the seeking, obtaining or application of any other relief under or with
respect to this Indenture. Neither the lien of this Indenture nor any rights or
remedies of the Indenture Trustee or the Noteholders shall be impaired by the
recovery of any judgment by the Indenture Trustee against the Issuer or by the
levy of any execution under such judgment upon any portion of the Indenture
Trust Estate or upon any of the assets of the Issuer. Any money or property
collected by the Indenture Trustee shall be applied in accordance with Section
5.4(b).
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SECTION 5.16 Performance and Enforcement of Certain Obligations.
(a) Promptly following a request from the Indenture Trustee to do so and
at the Administrator's expense, the Issuer shall take all such lawful action as
the Indenture Trustee may request to compel or secure the performance and
observance by the Depositor, SLM ECFC, the Administrator and the Servicer, as
applicable, of each of their respective obligations to the Issuer, whether
directly or by assignment, under or in connection with the Sale Agreement, the
Purchase Agreement, the Administration Agreement and the Servicing Agreement,
respectively, in accordance with the terms thereof, and to exercise any and all
rights, remedies, powers and privileges lawfully available to the Issuer under
or in connection with the Sale Agreement, the Purchase Agreement, the
Administration Agreement and the Servicing Agreement, as the case may be, to the
extent and in the manner directed by the Indenture Trustee, including the
transmission of notices of default on the part of the Depositor, SLM ECFC, the
Administrator or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Depositor, SLM ECFC, the Administrator or the Servicer of each of their
obligations under the Sale Agreement, the Purchase Agreement, the Administration
Agreement and the Servicing Agreement, respectively.
(b) If an Event of Default has occurred and is continuing, the Indenture
Trustee may, and at the written direction of the Noteholders of 66-2/3% of the
Outstanding Amount of the Notes shall, exercise all rights, remedies, powers,
privileges and claims of the Issuer against the Depositor, SLM ECFC, the
Administrator or the Servicer under or in connection with the Sale Agreement,
the Purchase Agreement, the Administration Agreement and the Servicing
Agreement, respectively, including the right or power to take any action to
compel or secure performance or observance by the Depositor, SLM ECFC, the
Administrator or the Servicer of each of their obligations to the Issuer
thereunder, whether directly or by assignment, and to give any consent, request,
notice, direction, approval, extension or waiver under the Sale Agreement, the
Purchase Agreement, the Administration Agreement and the Servicing Agreement,
respectively, and any right of the Issuer to take such action shall be
suspended.
ARTICLE VI
The Indenture Trustee
SECTION 6.1 Duties of Indenture Trustee. (a) If an Event of Default
has occurred and is continuing, the Indenture Trustee shall exercise the rights
and powers vested in it by this Indenture and use the same degree of care and
skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such duties and only
such duties as are specifically set forth in this Indenture and no implied
covenants or obligations shall be read into this Indenture against the Indenture
Trustee; and
(ii) in the absence of bad faith on its part, the Indenture Trustee
may conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed
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therein, upon certificates or opinions furnished to the Indenture Trustee and
conforming to the requirements of this Indenture; provided, however, that the
Indenture Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph (b) of
this Section;
(ii) the Indenture Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer unless it is proved that
the Indenture Trustee was negligent in ascertaining the pertinent facts; and
(iii) the Indenture Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.11.
(d) The Indenture Trustee shall not be liable for interest on any money
received by it except as the Indenture Trustee may agree in writing with the
Issuer.
(e) Money held in trust by the Indenture Trustee need not be segregated
from other funds except to the extent required by law or the terms of this
Indenture or the other Basic Documents.
(f) No provision of this Indenture shall require the Indenture Trustee to
expend or risk its own funds or otherwise incur financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers, if it shall have reasonable grounds to believe that repayments
of such funds or adequate indemnity satisfactory to it against any loss,
liability or expense is not reasonably assured to it.
(g) Except as expressly provided in the Basic Documents, the Indenture
Trustee shall have no obligation to administer, service or collect the Trust
Student Loans or to maintain, monitor or otherwise supervise the administration,
servicing or collection of the Trust Student Loans.
(h) In the event that the Indenture Trustee is the Paying Agent or the
Note Registrar, the rights and protections afforded to the Indenture Trustee
pursuant to this Indenture shall also be afforded to the Indenture Trustee in
its capacity as Paying Agent or Note Registrar.
(i) Every provision of this Indenture relating to the conduct or affecting
the liability of or affording protection to the Indenture Trustee shall be
subject to the provisions of this Section and to the provisions of the TIA.
SECTION 6.2 Rights of Indenture Trustee. (a) The Indenture Trustee
may rely on any document believed by it to be genuine and to have been signed or
presented by the proper Person. The Indenture Trustee need not investigate any
fact or matter stated in such document.
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(b) Before the Indenture Trustee acts or refrains from acting, it may
require and shall be entitled to receive an Officers' Certificate of the Issuer
and/or an Opinion of Counsel. The Indenture Trustee shall not be liable for any
action it takes or omits to take in good faith in reliance on such Officers'
Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers; provided, however, that the Indenture Trustee's conduct does
not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice or
opinion of counsel with respect to legal matters relating to this Indenture and
the Notes shall be full and complete authorization and protection from liability
in respect to any action taken, omitted or suffered by it hereunder in good
faith and in accordance with the advice or opinion of such counsel.
SECTION 6.3 Individual Rights of Indenture Trustee. The Indenture
Trustee in its individual or any other capacity may become the owner or pledgee
of Notes and may otherwise deal with the Issuer or its Affiliates with the same
rights it would have if it were not Indenture Trustee. Any Paying Agent, Note
Registrar, co-registrar or co-paying agent may do the same with like rights.
However, the Indenture Trustee must comply with Sections 6.11 and 6.12.
SECTION 6.4 Indenture Trustee's Disclaimer. The Indenture Trustee
shall not be responsible for and makes no representation as to the validity or
adequacy of this Indenture or the Notes, it shall not be accountable for the
Issuer's use of the proceeds from the Notes, and it shall not be responsible for
any statement of the Issuer in the Indenture or in any document issued in
connection with the sale of the Notes or in the Notes other than the Indenture
Trustee's certificate of authentication.
SECTION 6.5 Notice of Defaults. If a Default occurs and is
continuing and if it is either actually known or written notice of the existence
thereof has been delivered to a Responsible Officer of the Indenture Trustee,
the Indenture Trustee shall mail notice of the Default to each Noteholder within
90 days and to each Rating Agency as soon as practicable within 30 days after it
occurs. Except in the case of a Default in payment of principal of or interest
on any Note (including payments pursuant to the mandatory redemption provisions
of such Note), the Indenture Trustee may withhold the notice if and so long as a
committee of its Responsible Officers in good faith determines that withholding
the notice is in the interests of Noteholders and the Interest Rate Cap
Counterparty. Except as provided in the first sentence of this Section 6.5, in
no event shall the Indenture Trustee be deemed to have knowledge of a Default or
an Event of Default.
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SECTION 6.6 Reports by Indenture Trustee to Noteholders. The
Indenture Trustee shall deliver to each Noteholder (and to each Person who was a
Noteholder at any time during the applicable calendar year) such information as
may be required to enable such holder to prepare its Federal and state income
tax returns. Within 60 days after each December 31 beginning with the December
31 following the date of this Indenture, the Indenture Trustee shall mail to
each Noteholder a brief report as of such December 31 that complies with TIA
Section 313(a) if required by said section. The Indenture Trustee shall also
comply with TIA Section 313(b). A copy of each such report required pursuant to
TIA Section 313(a) or (b) shall, at the time of such transaction to Noteholders,
be filed by the Indenture Trustee with the Commission and with each securities
exchange, if any, upon which the Notes are listed, provided that the Issuer has
previously notified the Indenture Trustee of such listing.
SECTION 6.7 Compensation and Indemnity. The Issuer shall cause the
Depositor to pay to the Indenture Trustee reasonable compensation for its
services in accordance with a separate agreement between the Depositor and the
Indenture Trustee and shall cause the Depositor to reimburse the Indenture
Trustee for all reasonable out-of-pocket expenses incurred or made by it as
provided in such separate agreement. The Indenture Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express trust. The
Issuer shall cause the Administrator to indemnify the Indenture Trustee and its
directors, officers, employees and agents against any and all loss, liability or
expense (including attorneys' fees) incurred by it in connection with the
administration of this trust and the performance of its duties hereunder and
under the other Basic Documents. The Indenture Trustee shall notify the Issuer
and the Administrator promptly of any claim for which it may seek indemnity.
Failure by the Indenture Trustee to so notify the Issuer and the Administrator
shall not relieve the Issuer or the Administrator of its obligations hereunder
and under the other Basic Documents. The Issuer shall cause the Administrator to
defend the claim and the Administrator shall not be liable for the legal fees
and expenses of the Indenture Trustee after it has assumed such defense;
provided, however, that, in the event that there may be a conflict between the
positions of the Indenture Trustee and the Administrator in conducting the
defense of such claim, the Indenture Trustee shall be entitled to separate
counsel acceptable to it in its sole discretion the reasonable fees and expenses
of which shall be paid by the Administrator on behalf of the Issuer. Neither the
Issuer nor the Administrator need reimburse any expense or indemnify against any
loss, liability or expense incurred by the Indenture Trustee through the
Indenture Trustee's own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee pursuant
to this Section shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses after the occurrence of a Default specified in
Section 5.1(iv) or (v) with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable Federal or state bankruptcy, insolvency or similar law.
SECTION 6.8 Replacement of Indenture Trustee. No resignation or
removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.8. The Indenture Trustee
may resign at any time by so notifying the Issuer. The Noteholders of at least a
majority in Outstanding Amount of the Notes may remove the Indenture
34
Trustee by so notifying the Indenture Trustee and may appoint a successor
Indenture Trustee. The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section 6.11;
(ii) an Insolvency Event occurs with respect to the Indenture
Trustee;
(iii) a receiver or other public officer takes charge of the
Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of acting.
If the Indenture Trustee resigns or is removed or if a vacancy
exists in the office of Indenture Trustee for any reason (the Indenture Trustee
in such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of
its appointment to the retiring Indenture Trustee and to the Issuer. Thereupon
the resignation or removal of the retiring Indenture Trustee shall become
effective, and the successor Indenture Trustee shall have all the rights, powers
and duties of the Indenture Trustee under this Indenture. The successor
Indenture Trustee shall mail a notice of its succession to Noteholders. The
retiring Indenture Trustee shall promptly transfer all property held by it as
Indenture Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within 60 days
after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Noteholders of at least a majority in
Outstanding Amount of the Notes may petition any court of competent jurisdiction
for the appointment of a successor Indenture Trustee. The successor Indenture
Trustee shall give notice of its appointment as successor Indenture Trustee to
the Rating Agencies.
If the Indenture Trustee fails to comply with Section 6.11, any
Noteholder may petition any court of competent jurisdiction for the removal of
the Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee pursuant to
this Section, the Issuer's and the Administrator's obligations under Section 6.7
shall continue for the benefit of the retiring Indenture Trustee.
SECTION 6.9 Successor Indenture Trustee by Merger. If the Indenture
Trustee consolidates with, merges or converts into, or transfers all or
substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Indenture Trustee,
provided that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. The Indenture Trustee shall provide
the Rating Agencies prior written notice of any such transaction.
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In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any time,
for the purpose of meeting any legal requirement of any jurisdiction in which
any part of the Indenture Trust Estate may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Indenture Trust Estate,
and to vest in such Person or Persons, in such capacity and for the benefit of
the Noteholders, such title to the Indenture Trust Estate, or any part hereof,
and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Indenture Trustee may consider necessary
or desirable. No such appointment shall relieve the Indenture Trustee of its
obligations hereunder. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
6.11 and no notice to Noteholders of the appointment of any co-trustee or
separate trustee shall be required under Section 6.8 hereof.
(b) Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Indenture Trustee shall be conferred or imposed upon and exercised or
performed by the Indenture Trustee and such separate trustee or co-trustee
jointly (it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Indenture Trustee joining in such act),
except to the extent that under any law of any jurisdiction in which any
particular act or acts are to be performed the Indenture Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to the
Indenture Trust Estate or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason of
any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the resignation
of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as
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if given to each of them. Every instrument appointing any separate trustee or
co-trustee shall refer to this Indenture and the conditions of this Article VI.
Each separate trustee and co-trustee, upon its acceptance of the trusts
conferred, shall be vested with the estates or property specified in its
instrument of appointment, either jointly with the Indenture Trustee or
separately, as may be provided therein, subject to all the provisions of this
Indenture, specifically including every provision of this Indenture relating to
the conduct of, affecting the liability of, or affording protection to, the
Indenture Trustee. Every such instrument shall be filed with the Indenture
Trustee.
(d) Any separate trustee or co-trustee may at any time constitute the
Indenture Trustee, its agent or attorney-in-fact with full power and authority,
to the extent not prohibited by law, to do any lawful act under or in respect of
this Indenture on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 6.11 Eligibility; Disqualification. The Indenture Trustee
shall at all times satisfy the requirements of TIA Section 310(a), the
requirements of an "eligible lender" under 20 USC Section 1085(d) and the
requirements of Rule 3a-7(4)(i) of the General Rules and Regulations under the
Investment Company Act of 1940, as amended. The Indenture Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition and it shall have a long-term senior
unsecured debt rating of not less than investment grade by each of the Rating
Agencies. The Indenture Trustee shall comply with TIA Section 310(b), including
the optional provision permitted by the second sentence of TIA Section
310(b)(9); provided, however, that there shall be excluded from the operation of
TIA Section 310(b)(1) any indenture or indentures under which other securities
of the Issuer are outstanding if the requirements for such exclusion set forth
in TIA Section 310(b)(1) are met.
SECTION 6.12 Preferential Collection of Claims Against the Issuer.
The Indenture Trustee shall comply with TIA Section 311(a), excluding any
creditor relationship listed in TIA Section 311(b). An Indenture Trustee who has
resigned or been removed shall be subject to TIA Section 311(a) to the extent
indicated.
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.1 Issuer to Furnish Indenture Trustee Names and Addresses
of Noteholders. The Issuer will furnish or cause to be furnished to the
Indenture Trustee (a) not more than five days after the earlier of (i) each
Record Date and (ii) three months after the last Record Date, a list, in such
form as the Indenture Trustee may reasonably require, of the names and addresses
of the Noteholders as of such Record Date, and (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.
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SECTION 7.2 Preservation of Information; Communications to
Noteholders. The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Noteholders contained in
the most recent list furnished to the Indenture Trustee as provided in Section
7.1 and the names and addresses of Noteholders received by the Indenture Trustee
in its capacity as Note Registrar. The Indenture Trustee may destroy any list
furnished to it as provided in such Section 7.1 upon receipt of a new list so
furnished.
(a) Noteholders may communicate pursuant to TIA Section 312(b) with other
Noteholders with respect to their rights under this Indenture or under the
Notes. Upon receipt by the Indenture Trustee of any request by three or more
Noteholders or by one or more holders of Notes evidencing not less than 25% of
the Outstanding Amount of the Notes to receive a copy of the current list of
Noteholders (whether or not made pursuant to TIA Section 312(b)), the Indenture
Trustee shall promptly notify the Administrator thereof by providing to the
Administrator a copy of such request and a copy of the list of Noteholders
produced in response thereto.
(b) The Issuer, the Indenture Trustee and the Note Registrar shall have
the protection of TIA Section 312(c).
(c) On each Distribution Date the Indenture Trustee shall provide to each
Noteholder of record as of the related Record Date the information provided by
the Administrator to the Indenture Trustee on the related Determination Date
pursuant to Section 2.11 of the Administration Agreement.
(d) The Indenture Trustee shall furnish to the Noteholders promptly upon
receipt of a written request therefor, duplicates or copies of all reports,
notices, requests, demands, certificates, financial statements and any other
instruments furnished to the Indenture Trustee under the Basic Documents. The
Indenture Trustee shall furnish to the Noteholders promptly upon receipt thereof
from the Eligible Lender Trustee notice of any amendment of the Administration
Agreement pursuant to Section 8.5 of the Administration Agreement.
SECTION 7.3 Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after the Issuer
is required to file the same with the Commission, copies of the annual reports
and of the information, documents and other reports (or copies of such portions
of any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) which the Issuer may be required to file with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by the
Commission such additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this Indenture as
may be required from time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture Trustee
shall transmit by mail to all Noteholders described in TIA Section 313(c)) such
summaries of any
38
information, documents and reports required to be filed by the Issuer pursuant
to clauses (i) and (ii) of this Section 7.3(a) as may be required by rules and
regulations prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the Issuer
shall end on December 31 of each year.
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.1 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it on behalf of Noteholders or
the Trust pursuant to the Administration Agreement as provided in this
Indenture. Except as otherwise expressly provided in this Indenture, if any
default occurs in the making of any payment or performance under any agreement
or instrument that is part of the Indenture Trust Estate, the Indenture Trustee
may take such action as may be appropriate to enforce such payment or
performance, including the institution and prosecution of appropriate
Proceedings. Any such action shall be without prejudice to any right to claim a
Default under this Indenture and any right to proceed thereafter as provided in
Article V.
SECTION 8.2 Trust Accounts. (a) On or prior to the Closing Date, the
Issuer shall cause the Administrator to establish and maintain, in the name of
the Indenture Trustee, for the benefit of the Noteholders and the Trust, the
Trust Accounts as provided in Section 2.3 of the Administration Agreement.
(b) On or before the Business Day immediately preceding each Distribution
Date, all Available Funds and amounts set forth in paragraph (a)(2) of the
definition of Available Funds with respect to the preceding Collection Period
will be deposited in the Collection Account as provided in Section 2.4 of the
Administration Agreement. On or before each Distribution Date, the Indenture
Trustee (or any other Paying Agent) shall make the required deposits and
distributions as provided in Sections 2.7 and 2.8 of the Administration
Agreement.
SECTION 8.3 General Provisions Regarding Accounts. (a) So long as no
Default shall have occurred and be continuing, all or a portion of the funds in
the Trust Accounts shall be invested in Eligible Investments and reinvested by
the Indenture Trustee upon Issuer Order, subject to the provisions of Section
2.3(b) of the Administration Agreement. All income or other gain from
investments of moneys deposited in the Trust Accounts shall be deposited by the
Indenture Trustee in the Collection Account, and any loss resulting from such
investments shall be charged to such Trust Account. The Issuer will not direct
the Indenture Trustee to make any investment of any funds or to sell any
investment held in any of the Trust Accounts unless the security interest
granted and perfected in such account will continue to be perfected in such
investment or the proceeds of such sale, in either case without any further
action by any Person, and, in connection with any direction to the Indenture
Trustee to make any such investment or
39
sale, if requested by the Indenture Trustee, the Issuer shall deliver to the
Indenture Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to
such effect.
(b) Subject to Section 6.1(c), the Indenture Trustee shall not in any way
be held liable for the selection of Eligible Investments or by reason of any
insufficiency in any of the Trust Accounts resulting from any loss on any
Eligible Investment included therein except for losses attributable to the
Indenture Trustee's failure to make payments on such Eligible Investments issued
by the Indenture Trustee, in its commercial capacity as principal obligor and
not as trustee, in accordance with their terms.
(c) If (i) the Issuer shall have failed to give investment directions for
any funds on deposit in the Trust Accounts to the Indenture Trustee by 10:00
a.m. Eastern Time (or such other time as may be agreed by the Issuer and
Indenture Trustee) on any Business Day; or (ii) a Default shall have occurred
and be continuing with respect to the Notes but the Notes shall not have been
declared due and payable pursuant to Section 5.2, or, if such Notes shall have
been declared due and payable following an Event of Default, amounts collected
or receivable from the Indenture Trust Estate are being applied in accordance
with Section 5.5 as if there had not been such a declaration; then the Indenture
Trustee shall invest and reinvest funds in the Trust Accounts in the Eligible
Investments described in clause (d) of the definition thereof.
SECTION 8.4 Release of Indenture Trust Estate. (a) Subject to the
payment of its fees and expenses pursuant to Section 6.7, the Indenture Trustee
may, and when required by the provisions of this Indenture shall, execute
instruments to release property from the lien of this Indenture, or convey the
Indenture Trustee's interest in the same, in a manner and under circumstances
that are not inconsistent with the provisions of this Indenture. No party
relying upon an instrument executed by the Indenture Trustee as provided in this
Article VIII shall be bound to ascertain the Indenture Trustee's authority,
inquire into the satisfaction of any conditions precedent or see to the
application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no Notes
Outstanding and all sums due the Indenture Trustee pursuant to Section 6.7 have
been paid, release any remaining portion of the Indenture Trust Estate that
secured the Notes from the lien of this Indenture and release to the Issuer or
any other Person entitled thereto any funds then on deposit in the Trust
Accounts. The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.4(b) only upon receipt of an Issuer Request
accompanied by an Officers' Certificate of the Issuer, an Opinion of Counsel and
(if required by the TIA) Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.1.
(c) Each Noteholder, by the acceptance of a Note, acknowledges that from
time to time the Indenture Trustee shall release the lien of this Indenture on
any Trust Student Loan to be sold (i) to the Depositor in accordance with
Section 6 of the Sale Agreement, (ii) to the Servicer in accordance with Section
3.5 of the Servicing Agreement, (iii) to SLM ECFC or another Affiliate of SLM
Corporation in accordance with Section 3.11F of the Servicing Agreement, (iv) to
another eligible lender holding one or more Serial Loans with respect to such
Trust Student Loan or (v) to SLM ECFC in accordance with Section 6 of the
Purchase Agreement, and each Noteholder, by the acceptance of a Note, consents
to any such release.
40
SECTION 8.5 Opinion of Counsel. The Indenture Trustee shall receive
at least seven days' notice when requested by the Issuer to take any action
pursuant to Section 8.4(a), accompanied by copies of any instruments involved,
and the Indenture Trustee shall also require, except in connection with any
action contemplated by Section 8.4(c), as a condition to such action, an Opinion
of Counsel, in form and substance satisfactory to the Indenture Trustee, stating
the legal effect of any such action, outlining the steps required to complete
the same, and concluding that all conditions precedent to the taking of such
action have been complied with and such action will not materially and adversely
impair the security for the Notes or the rights of the Noteholders in
contravention of the provisions of this Indenture; provided, however, that such
Opinion of Counsel shall not be required to express an opinion as to the fair
value of the Indenture Trust Estate. Counsel rendering any such opinion may
rely, without independent investigation, on the accuracy and validity of any
certificate or other instrument delivered to the Indenture Trustee in connection
with any such action.
ARTICLE IX
Supplemental Indentures
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of any Noteholders but with prior notice to the
Rating Agencies, the Issuer and the Indenture Trustee, when authorized by an
Issuer Order, at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as in force at the date of the execution thereof), in form
satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at any
time subject to the lien of this Indenture, or better to assure, convey and
confirm unto the Indenture Trustee any property subject or required to be
subjected to the lien of this Indenture, or to subject to the lien of this
Indenture additional property;
(ii) to evidence the succession, in compliance with the applicable
provisions hereof, of another person to the Issuer, and the assumption by any
such successor of the covenants of the Issuer herein and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the benefit of the
Noteholders, or to surrender any right or power herein conferred upon the
Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any property to
the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any provision
herein or in any supplemental indenture which may be inconsistent with any other
provision herein or in any supplemental indenture or to make any other
provisions with respect to matters or questions arising under this Indenture or
in any supplemental indenture; provided that such action shall not materially
adversely affect the interests of the Noteholders;
41
(vi) to evidence and provide for the acceptance of the appointment
hereunder by a successor trustee with respect to the Notes and to add to or
change any of the provisions of this Indenture as shall be necessary to
facilitate the administration of the trusts hereunder by more than one trustee,
pursuant to the requirements of Article VI; or
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the qualification of
this Indenture under the TIA or under any similar Federal statute hereafter
enacted and to add to this Indenture such other provisions as may be expressly
required by the TIA.
The Indenture Trustee is hereby authorized to join in the execution
of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
(b) The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, may, also without the consent of any of the Noteholders but with prior
notice to the Rating Agencies, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders under this Indenture;
provided, however, that such action shall not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any
Noteholder.
SECTION 9.2 Supplemental Indentures with Consent of Noteholders. The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with prior notice to the Rating Agencies and with the consent of the Noteholders
of at least a majority of the Outstanding Amount of the Notes, by Act of such
Noteholders delivered to the Issuer and the Indenture Trustee, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Noteholders
under this Indenture; provided, however, that no such supplemental indenture
shall, without the consent of the Noteholder of each Outstanding Note affected
thereby:
(i) change the date of payment of any installment of principal of or
interest on any Note, or reduce the principal amount thereof, the interest rate
thereon or the Redemption Price with respect thereto, change the provisions of
this Indenture relating to the application of collections on, or the proceeds of
the sale of, the Indenture Trust Estate to payment of principal of or interest
on the Notes, or change any place of payment where, or the coin or currency in
which, any Note or the interest thereon is payable or impair the right to
institute suit for the enforcement of the provisions of this Indenture requiring
the application of funds available therefor, as provided in Article V, to the
payment of any such amount due on the Notes on or after the respective due dates
thereof (or, in the case of redemption, on or after the Redemption Date);
(ii) reduce the percentage of the Outstanding Amount of the Notes,
the consent of the Noteholders of which is required for any such supplemental
indenture, or the consent of the Noteholders of which is required for any waiver
of compliance with certain
42
provisions of this Indenture or certain defaults hereunder and their
consequences provided for in this Indenture;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Indenture Trustee to direct the Issuer to sell or
liquidate the Indenture Trust Estate pursuant to Section 5.4;
(v) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional provisions of
this Indenture or the other Basic Documents cannot be modified or waived without
the consent of the Noteholder of each Outstanding Note affected thereby;
(vi) modify any of the provisions of this Indenture in such manner
as to affect the calculation of the amount of any payment of interest or
principal due on any Note on any Distribution Date (including the calculation of
any of the individual components of such calculation) or to affect the rights of
the Noteholders to the benefit of any provisions for the mandatory redemption of
the Notes contained herein; or
(vii) permit the creation of any lien ranking prior to or on a
parity with the lien of this Indenture with respect to any part of the Indenture
Trust Estate or, except as otherwise permitted or contemplated herein, terminate
the lien of this Indenture on any property at any time subject hereto or deprive
any Noteholder of any Note of the security provided by the lien of this
Indenture.
It shall not be necessary for any Act of Noteholders under this
Section to approve the particular form of any proposed supplemental indenture,
but it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by the Issuer and the Indenture Trustee
of any supplemental indenture pursuant to this Section, the Indenture Trustee
shall mail to the Noteholders of the Notes to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Indenture Trustee
to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
SECTION 9.3 Execution of Supplemental Indentures. In executing, or
permitting the additional trusts created by, any supplemental indenture
permitted by this Article IX or the modifications thereby of the trusts created
by this Indenture, the Indenture Trustee shall be entitled to receive, and
subject to Sections 6.1 and 6.2, shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Indenture Trustee may, but shall
not be obligated to, enter into any such supplemental indenture that affects the
Indenture Trustee's own rights, duties, liabilities or immunities under this
Indenture or otherwise.
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SECTION 9.4 Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith with
respect to the Notes affected thereby, and the respective rights, limitations of
rights, obligations, duties, liabilities and immunities under this Indenture of
the Indenture Trustee, the Issuer and the Noteholders shall thereafter be
determined, exercised and enforced hereunder subject in all respects to such
modifications and amendments, and all the terms and conditions of any such
supplemental indenture shall be and be deemed to be part of the terms and
conditions of this Indenture for any and all purposes.
SECTION 9.5 Conformity with Trust Indenture Act. Every amendment of
this Indenture and every supplemental indenture executed pursuant to this
Article IX shall conform to the requirements of the Trust Indenture Act as then
in effect so long as this Indenture shall then be qualified under the Trust
Indenture Act.
SECTION 9.6 Reference in Notes to Supplemental Indentures. Notes
authenticated and delivered after the execution of any supplemental indenture
pursuant to this Article IX may, and if required by the Indenture Trustee shall,
bear a notation in form approved by the Indenture Trustee as to any matter
provided for in such supplemental indenture. If the Issuer or the Indenture
Trustee shall so determine, new Notes so modified as to conform, in the opinion
of the Indenture Trustee and the Issuer, to any such supplemental indenture may
be prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
Redemption of Notes
SECTION 10.1 Redemption. The Indenture Trustee shall, upon receipt
of written notice from the Servicer pursuant to Section 6.1(b) of the
Administration Agreement, give prompt written notice to the Noteholders of the
occurrence of such event. In the event that the assets of the Trust are sold
pursuant to Section 6.1(a) of the Administration Agreement, that portion of the
amounts on deposit in the Trust Accounts to be distributed to the Noteholders
shall be paid to the Noteholders as provided in Sections 2.7 and 2.8 of the
Administration Agreement. If amounts are to be paid to Noteholders pursuant to
this Section 10.1, the notice of such event from the Indenture Trustee to the
Noteholders shall include notice of the redemption of Notes by application of
such amounts on the next Distribution Date which is not sooner than 15 days
after the date of such notice (the "Redemption Date"), whereupon all such
amounts shall be payable on the Redemption Date.
SECTION 10.2 Form of Redemption Notice. Notice of redemption under
Section 10.1 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, or by facsimile, mailed or transmitted on or prior to the
applicable Redemption Date to each Noteholder, as of the close of business on
the Record Date preceding the applicable Redemption Date, at such Noteholder's
address or facsimile number appearing in the Note Register.
All notices of redemption shall state:
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(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for payment
of the Redemption Price (which shall be the office or agency of the Issuer to be
maintained as provided in Section 3.2).
Notice of redemption of the Notes shall be given by the Indenture
Trustee in the name and at the expense of the Issuer. Failure to give notice of
redemption, or any defect therein, to any Noteholder of any Note shall not
impair or affect the validity of the redemption of any other Note.
SECTION 10.3 Notes Payable on Redemption Date. The Notes or portions
thereof to be redeemed shall on the Redemption Date become due and payable at
the Redemption Price and (unless the Issuer shall default in the payment of the
Redemption Price) no interest shall accrue on the Redemption Price for any
period after the date to which accrued interest is calculated for purposes of
calculating the Redemption Price.
ARTICLE XI
Miscellaneous
SECTION 11.1 Compliance Certificates and Opinions, etc. (a) Upon any
application or request by the Issuer to the Indenture Trustee to take any action
under any provision of this Indenture, the Issuer shall furnish to the Indenture
Trustee and the Rating Agencies (i) an Officers' Certificate of the Issuer
stating that all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with, (ii) an Opinion of
Counsel stating that in the opinion of such counsel all such conditions
precedent, if any, have been complied with and (iii) (if required by the TIA) an
Independent Certificate from a firm of certified public accountants meeting the
applicable requirements of this Section, except that, in the case of any such
application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this indenture shall include:
(i) a statement that each signatory of such certificate or opinion
has read or has caused to be read such covenant or condition and the definitions
herein relating thereto;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is necessary to enable
such signatory to express
45
an informed opinion as to whether or not such covenant or condition has been
complied with; and
(iv) a statement as to whether, in the opinion of each such
signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other property or
securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in Section 11.1(a) or
elsewhere in this Indenture, furnish to the Indenture Trustee and the Rating
Agencies an Officers' Certificate of the Issuer certifying or stating the
opinion of each person signing such certificate as to the fair value (within 90
days of such deposit) to the Issuer of the Collateral or other property or
securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the Indenture
Trustee and the Rating Agencies an Officers' Certificate of the Issuer
certifying or stating the opinion of any signer thereof as to the matters
described in clause (i) above, the Issuer shall also deliver to the Indenture
Trustee an Independent Certificate as to the same matters, if the fair value to
the Issuer of the securities to be so deposited and of all other such securities
made the basis of any such withdrawal or release since the commencement of the
then-current fiscal year of the Issuer, as set forth in the certificates
delivered pursuant to clause (i) above and this clause (ii), is 10% or more of
the Outstanding Amount of the Notes, but such a certificate need not be
furnished with respect to any securities so deposited, if the fair value thereof
to the Issuer as set forth in the related Officers' Certificate is less than
$25,000 or less than one percent of the Outstanding Amount of the Notes.
(iii) Other than any property released as contemplated by clause (v)
below, whenever any property or securities are to be released from the lien of
this Indenture, the Issuer shall also furnish to the Indenture Trustee an
Officers' Certificate of the Issuer certifying or stating the opinion of each
person signing such certificate as to the fair value (within 90 days of such
release) of the property or securities proposed to be released and stating that
in the opinion of such person the proposed release will not impair the security
under this Indenture in contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the Indenture
Trustee an Officers' Certificate of the Issuer certifying or stating the opinion
of any signer thereof as to the matters described in clause (iii) above, the
Issuer shall also furnish to the Indenture Trustee an Independent Certificate as
to the same matters if the fair value of the property or securities and of all
other property, other than property as contemplated by clause (v) below, or
securities released from the lien of this Indenture since the commencement of
the then-current calendar year, as set forth in the certificates required by
clause (iii) above and this clause (iv), equals 10% or more of the Outstanding
Amount of the Notes, but such certificate need not be furnished in the case of
any release of property or securities if the fair value thereof as set forth in
the related Officers' Certificate is less than $25,000 or less than one percent
of the then Outstanding Amount of the Notes.
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(v) Notwithstanding Section 2.9 or any other provision of this
Section, the Issuer may, without compliance with the requirements of the other
provisions of this Section, (A) collect, liquidate, sell or otherwise dispose of
Trust Student Loans as and to the extent permitted or required by the Basic
Documents, (B) make cash payments out of the Trust Accounts as and to the extent
permitted or required by the Basic Documents and (C) convey to the Depositor,
the Servicer or another eligible lender those specified Trust Student Loans as
and to the extent permitted or required by and in accordance with Section 8.4(c)
hereof and Section 6 of the Sale Agreement, Section 3.5 of the Servicing
Agreement or Section 3.11E of the Servicing Agreement, respectively, so long as
the Issuer shall deliver to the Indenture Trustee every six months, commencing
December 31, 2004, an Officers' Certificate of the Issuer stating that all the
dispositions of Collateral described in clauses (A), (B) or (C) above that
occurred during the immediately preceding six calendar months were in the
ordinary course of the Issuer's business and that the proceeds thereof were
applied in accordance with the Basic Documents.
SECTION 11.2 Form of Documents Delivered to Indenture Trustee. In
any case where several matters are required to be certified by, or covered by an
opinion of, any specified Person, it is not necessary that all such matters be
certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters, and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the Issuer
may be based, insofar as it relates to legal matters, upon a certificate or
opinion of, or representations by, counsel, unless such officer knows, or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer, the Depositor, the Issuer or the Administrator, stating that the
information with respect to such factual matters is in the possession of the
Servicer, the Depositor, the Issuer or the Administrator, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Indenture Trustee, it is provided that the Issuer
shall deliver any document as a condition of the granting of such application,
or as evidence of the Issuer's compliance with any term hereof, it is intended
that the truth and accuracy, at the time of the granting of such application or
at the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Indenture Trustee's right to rely upon the
47
truth and accuracy of any statement or opinion contained in any such document as
provided in Article VI.
SECTION 11.3 Acts of Noteholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee, and, where it
is hereby expressly required, to the Issuer. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Noteholders signing such instrument or instruments. Proof
of execution of any such instrument or of a writing appointing any such agent
shall be sufficient for any purpose of this Indenture and (subject to Section
6.1) conclusive in favor of the Indenture Trustee and the Issuer, if made in the
manner provided in this Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver
or other action by any Noteholder shall bind the Noteholder of every Note issued
upon registration of transfer thereof or in exchange therefor or in lieu
thereof, in respect of anything done, omitted or suffered to be done by the
Indenture Trustee or the Issuer in reliance thereon, whether or not notation of
such action is made upon such Note.
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer and Rating
Agencies. Any request, demand, authorization, direction, notice, consent, waiver
or Act of Noteholders or other documents provided or permitted by this Indenture
shall be in writing and if such request, demand, authorization, direction,
notice, consent, waiver or Act of Noteholders is to be made upon, given or
furnished to or filed with:
(a) The Indenture Trustee by any Noteholder, the Servicer, the
Administrator or by the Issuer shall be sufficient for every purpose hereunder
if made, given, furnished or filed in writing to or with the Indenture Trustee
at its Corporate Trust Office with a copy to: Deutsche Bank Trust Company
Americas, 00 Xxxx Xxxxxx, 00xx Xxxxx, Mailstop XXX00-0000, Xxx Xxxx, Xxx Xxxx
00000, Attention: Trust & Securities Services/Structured Finance Services.
(b) The Issuer by the Indenture Trustee or by any Noteholder shall be
sufficient for every purpose hereunder if in writing and mailed, first-class,
postage prepaid, to the Issuer addressed to: SLM Student Loan Trust 2004-7, in
care of Chase Manhattan Bank USA, National Association, Christiana Center/OPS4,
000 Xxxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
Department; with copies to JPMorgan Chase Bank, 000 Xxxx 00xx Xxxxxx 00xx Xx.,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Structured Finance Services; and the
Administrator, 00000 Xxxxxx Xxx Xxxxx, Xxxxxx, Xxxxxxxx 00000, Attention: ABS
Trust Administration, or any other address previously furnished in writing to
the Indenture Trustee by
48
the Issuer or the Administrator. The Issuer shall promptly transmit any notice
received by it from the Noteholders to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer,
the Indenture Trustee or the Eligible Lender Trustee shall be in writing,
personally delivered or mailed by certified mail, return receipt requested, to
(i) in the case of Moody's, at the following address: ABS Monitoring Department,
00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (ii) in the case of S&P, at the
following address: 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000-0000, Attention:
Asset Backed Surveillance Department, 32nd Floor, and (iii) in the case of
Fitch, at the following address: Xxx Xxxxx Xxxxxx Xxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Municipal Structured Finance Group; or as to each of the
foregoing, at such other address as shall be designated by written notice to the
other parties.
Notices to the Interest Rate Cap Counterparty shall be sent to the
address set forth in the Interest Rate Cap Agreement or such other address as
may be designated by written notice to the parties to this Indenture.
SECTION 11.5 Notices to Noteholders; Waiver. Where this Indenture
provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice
may be waived in writing by any Person entitled to receive such notice, either
before or after the event, and such waiver shall be the equivalent of such
notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service as a
result of a strike, work stoppage or similar activity, it shall be impractical
to mail notice of any event to Noteholders when such notice is required to be
given pursuant to any provision of this Indenture, then any manner of giving
such notice as shall be satisfactory to the Indenture Trustee shall be deemed to
be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating Agencies,
failure to give such notice shall not affect any other rights or obligations
created hereunder, and shall not under any circumstance constitute a Default.
SECTION 11.6 Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Noteholder providing
for a method of payment, or notice by the Indenture Trustee or any Paying Agent
to such Noteholder, that is different from the methods provided for
49
in this Indenture for such payments or notices. The Issuer will furnish to the
Indenture Trustee a copy of each such agreement and the Indenture Trustee will
cause payments to be made and notices to be given in accordance with such
agreements.
SECTION 11.7 Conflict with Trust Indenture Act. If any provision
hereof limits, qualifies or conflicts with another provision hereof that is
required to be included in this Indenture by any of the provisions of the Trust
Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose duties on
any Person (including the provisions automatically deemed included herein unless
expressly excluded by this Indenture) are a part of and govern this Indenture,
whether or not physically contained herein.
SECTION 11.8 Effect of Headings and Table of Contents. The Article
and Section headings herein and the Table of Contents are for convenience only
and shall not affect the construction hereof.
SECTION 11.9 Successors and Assigns. All covenants and agreements in
this Indenture and the Notes by the Issuer shall bind its successor and assigns,
whether so expressed or not. All agreements of the Indenture Trustee in this
Indenture shall bind the successors, co-trustees and agents (excluding any legal
representatives or accountants) of the Indenture Trustee.
SECTION 11.10 Separability. In case any provision in this Indenture
or in the Notes shall be invalid, illegal or unenforceable, the validity,
legality, and enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
SECTION 11.11 Benefits of Indenture. Nothing in this Indenture or in
the Notes, express or implied shall give to any person, other than the parties
hereto and their successors hereunder, the Noteholders, any other party secured
hereunder, and any other Person with an ownership interest in any part of the
Indenture Trust Estate, any benefit or any legal or equitable right, remedy or
claim under this Indenture.
SECTION 11.12 Legal Holidays. In any case where the date on which
any payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such date,
but may be made on the next succeeding Business Day with the same force and
effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 11.13 Governing Law. THIS INDENTURE SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTIONS 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
50
SECTION 11.14 Counterparts. This Indenture may be executed in any
number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15 Recording of Indenture. If this Indenture is subject
to recording in any appropriate public recording offices, such recording is to
be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.
SECTION 11.16 Trust Obligations. No recourse may be taken, directly
or indirectly, with respect to the obligations of the Issuer, the Depositor, the
Administrator, the Servicer, the Eligible Lender Trustee or the Indenture
Trustee on the Notes or under this Indenture or any certificate or other writing
delivered in connection herewith or therewith, against (i) the Indenture Trustee
or the Eligible Lender Trustee in its individual capacity, (ii) any owner of a
beneficial interest in the Issuer or (iii) any partner, owner, beneficiary,
agent, officer, director or employee of the Indenture Trustee or the Eligible
Lender Trustee in its individual capacity, any holder or owner of a beneficial
interest in the Issuer, the Eligible Lender Trustee or the Indenture Trustee or
of any successor or assign thereof in its individual capacity, except as any
such Person may have expressly agreed (it being understood that the Indenture
Trustee and the Eligible Lender Trustee have no such obligations in their
individual capacity) and except that any such partner, owner or beneficiary
shall be fully liable, to the extent provided by applicable law, for any unpaid
consideration for stock, unpaid capital contribution or failure to pay any
installment or call owing to such entity. For all purposes of this Indenture, in
the performance of any duties or obligations of the Issuer hereunder, the
Eligible Lender Trustee shall be subject to, and entitled to the benefits of,
the terms and provisions of Articles VI, VII and VIII of the Trust Agreement.
SECTION 11.17 No Petition. The Indenture Trustee, by entering into
this Indenture, and each Noteholder, by accepting a Note, hereby covenant and
agree that they shall not at any time institute against the Depositor or the
Issuer, or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency, receivership or liquidation
proceedings, or other proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Notes, this Indenture or any of the other Basic Documents. The foregoing shall
not limit the rights of the Indenture Trustee to file any claim in, or otherwise
take any action with respect to, any insolvency proceeding that was instituted
against the Issuer by any Person other than the Indenture Trustee.
SECTION 11.18 Inspection. The Issuer agrees that, on reasonable
prior notice, it shall permit any representative of the Indenture Trustee,
during the Issuer's normal business hours, to examine all the books of account,
records, reports, and other papers of the Issuer, to make copies and extracts
therefrom, to cause such books to be audited by Independent certified public
accountants, and to discuss the Issuer's affairs, finances and accounts with the
Issuer's officers, employees, and Independent certified public accountants, all
at such reasonable times and as often as may be reasonably requested. The
Indenture Trustee shall and shall cause its
51
representatives to hold in confidence all such information obtained from such
examination or inspection except to the extent disclosure may be required by law
(and all reasonable applications for confidential treatment are unavailing) and
except to the extent that the Indenture Trustee may reasonably determine that
such disclosure is consistent with its obligations hereunder.
52
IN WITNESS WHEREOF, the Issuer, the Eligible Lender Trustee and the
Indenture Trustee have caused this Indenture to be duly executed by their
respective officers, thereunto duly authorized and duly attested, all as of the
day and year first above written.
SLM STUDENT LOAN TRUST 2004-7
By: CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, not in its individual capacity
but solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Eligible Lender
Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
DEUTSCHE BANK TRUST COMPANY AMERICAS,
not in its individual capacity but solely
as Indenture Trustee
By: /s/ XXXXXXX X. X. XXXX
Name: Xxxxxxx H.Y. Voon
Title: Assistant Vice President
53
APPENDIX A
DEFINITIONS AND USAGE
Series 2004-7
USAGE
The following rules of construction and usage shall be applicable to any
instrument that is governed by this appendix (this "Appendix"):
(a) All terms defined in this Appendix shall have the defined meanings
when used in any instrument governed hereby and in any certificate or other
document made or delivered pursuant thereto unless otherwise defined therein.
(b) As used herein, in any instrument governed hereby and in any
certificate or other document made or delivered pursuant thereto, accounting
terms not defined in this Appendix or in any such instrument, certificate or
other document, and accounting terms partly defined in this Appendix or in any
such instrument, certificate or other document, to the extent not defined, shall
have the respective meanings given to them under generally accepted accounting
principles as in effect on the date of such instrument. To the extent that the
definitions of accounting terms in this Appendix or in any such instrument,
certificate or other document are inconsistent with the meanings of such terms
under generally accepted accounting principles, the definitions contained in
this Appendix or in any such instrument, certificate or other document shall
control.
(c) The words "hereof," "herein," "hereunder" and words of similar import
when used in an instrument refer to such instrument as a whole and not to any
particular provision or subdivision thereof; references in an instrument to
"Article," "Section" or another subdivision or to an attachment are, unless the
context otherwise requires, to an article, section or subdivision of or an
attachment to such instrument; and the term "including" means "including without
limitation."
(d) The definitions contained in this Appendix are equally applicable to
both the singular and plural forms of such terms and to the masculine as well as
to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to below or
in any agreement or instrument that is governed by this Appendix means such
agreement or instrument or statute as from time to time amended, modified or
supplemented, including (in the case of agreements or instruments) by
assignment, assumption, waiver or consent and (in the case of statutes) by
succession of comparable successor statutes and includes (in the case of
agreements or instruments) references to all attachments thereto and instruments
incorporated therein. References to a Person are also to its permitted
successors and assigns.
Appendix A-1
DEFINITIONS
"Accrual Period" means, with respect to a Distribution Date, the period
from and including the immediately preceding Distribution Date to, but
excluding, the then-current Distribution Date, or in the case of the initial
such period, the period from and including the Closing Date to, and including,
October 24, 2004.
"Act" means the Securities Act of 1933, as amended.
"Actual/360" means that interest is calculated on the basis of the actual
number of days elapsed in a year of 360 days.
"Adjusted Pool Balance" means, for any Distribution Date, (a) if the Pool
Balance as of the last day of the related Collection Period is greater than 40%
of the Initial Pool Balance, the sum of that Pool Balance, Capitalized Interest
and the Specified Reserve Account Balance for that Distribution Date, or (b) if
the Pool Balance as of the last day of the related Collection Period is less
than or equal to 40% of the Initial Pool Balance, the sum of that Pool Balance
and Capitalized Interest.
"Administration Agreement" means the Administration Agreement dated as of
July 28, 2004, among the Administrator, the Servicer, the Depositor, the Trust
and the Eligible Lender Trustee.
"Administration Fees" has the meaning specified in Section 2.14 of the
Administration Agreement.
"Administrator" means Xxxxxx Xxx, Inc., in its capacity as administrator
of the Trust in accordance with the Administration Agreement.
"Administrator Default" has the meaning specified in Section 5.1 of the
Administration Agreement.
"Administrator's Certificate" means an Officers' Certificate of the
Administrator delivered pursuant to Section 3.1(c) of the Administration
Agreement.
"Administrator's Officers' Certificate" means an Officers' Certificate of
the Administrator delivered pursuant to Section 3.1(b) of the Administration
Agreement.
"Affiliate" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
Appendix A-2
"Authenticating Agent" means JPMorgan Chase Bank, as authenticating agent
in respect of the Excess Distribution Certificate.
"Authorized Officer" means (i) with respect to the Trust, any officer of
the Eligible Lender Trustee who is authorized to act for the Eligible Lender
Trustee in matters relating to the Trust pursuant to the Basic Documents and who
is identified on the list of Authorized Officers delivered by the Eligible
Lender Trustee to the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter), (ii) with respect to the
Administrator, any officer of the Administrator or any of its Affiliates who is
authorized to act for the Administrator in matters relating to itself or to the
Trust and to be acted upon by the Administrator pursuant to the Basic Documents
and who is identified on the list of Authorized Officers delivered by the
Administrator to the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter), (iii) with respect to
the Depositor, any officer of the Depositor or any of its Affiliates who is
authorized to act for the Depositor in matters relating to or to be acted upon
by the Depositor pursuant to the Basic Documents and who is identified on the
list of Authorized Officers delivered by the Depositor to the Indenture Trustee
on the Closing Date (as such list may be modified or supplemented from time to
time thereafter) and (iv) with respect to the Servicer, any officer of the
Servicer who is authorized to act for the Servicer in matters relating to or to
be acted upon by the Servicer pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Servicer to the
Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter).
"Available Funds" means, as to a Distribution Date or any related Monthly
Servicing Payment Date, the sum of the following amounts received with respect
to the related Collection Period or, in the case of a Monthly Servicing Payment
Date, the applicable portion of these amounts:
(a) all collections on the Trust Student Loans received by the Servicer
on the Trust Student Loans, including any Guarantee Payments
received on the Trust Student Loans, but net of:
(1) any collections in respect of principal on the Trust
Student Loans applied by the Trust to repurchase
guaranteed loans from the Guarantors under the Guarantee
Agreements, and
(2) amounts required by the Higher Education Act to be paid
to the Department or to be repaid to borrowers, whether
or not in the form of a principal reduction of the
applicable Trust Student Loan, on the Trust Student
Loans for that Collection Period, if any;
(b) any Interest Subsidy Payments and Special Allowance Payments with
respect to the Trust Student Loans during that Collection Period;
(c) all Liquidation Proceeds from any Trust Student Loans which became
Liquidated Student Loans during that Collection Period in accordance
with
Appendix A-3
the Servicer's customary servicing procedures, net of expenses
incurred by the Servicer related to their liquidation and any
amounts required by law to be remitted to the borrowers on the
Liquidated Student Loans, and all Recoveries on Liquidated Student
Loans which were written off in prior Collection Periods or during
that Collection Period;
(d) the aggregate Purchase Amounts received during that Collection
Period for those Trust Student Loans repurchased by the Depositor or
purchased by the Servicer or for Trust Student Loans sold to another
eligible lender pursuant to Section 3.11E of the Servicing
Agreement;
(e) the aggregate Purchase Amounts received during that Collection
Period for those Trust Student Loans repurchased by SLM ECFC;
(f) the aggregate amounts, if any, received from any of SLM ECFC, the
Depositor or the Servicer, as the case may be, as reimbursement of
non-guaranteed interest amounts, or lost Interest Subsidy Payments
and Special Allowance Payments, on the Trust Student Loans pursuant
to the Sale Agreement or Section 3.5 of the Servicing Agreement,
respectively;
(g) amounts received by the Trust pursuant to Sections 3.1 and 3.12 of
the Servicing Agreement during that Collection Period as to yield or
principal adjustments;
(h) any interest remitted by the Administrator to the Collection Account
prior to such Distribution Date or Monthly Servicing Payment Date;
(i) Investment Earnings for that Distribution Date earned on amounts on
deposit in each Trust Account;
(j) payments received under the Interest Rate Cap Agreement;
(k) on the July 2006 Distribution Date, all funds then on deposit in the
Capitalized Interest Account that are transferred into the
Collection Account on that Distribution Date;
(l) amounts transferred from the Reserve Account in excess of the
Specified Reserve Account Balance as of that Distribution Date; and
(m) as to the first Distribution Date, the Collection Account Initial
Deposit.
provided that if on any Distribution Date there would not be sufficient
funds, after application of Available Funds, as defined above, and
application of amounts available from the Capitalized Interest Account and
the Reserve Account, in that order, to pay any of the items specified in
clauses (a) through (d) of Section 2.8 of the Administration Agreement
(but excluding clause (d), and including clauses (e) through (i) thereof,
in the event that a condition exists as described in either clause (i) or
(ii) of paragraph (x) of Section 2.8 of the Administration Agreement), as
set forth in Section 2.9 of the
Appendix A-4
Administration Agreement, relating to such distributions, then Available
Funds for that Distribution Date will include, in addition to the
Available Funds as defined above, amounts on deposit in the Collection
Account, or amounts held by the Administrator, or which the Administrator
reasonably estimates to be held by the Administrator, for deposit into the
Collection Account on the related Determination Date which would have
constituted Available Funds for the Distribution Date succeeding that
Distribution Date, up to the amount necessary to pay such items, and the
Available Funds for the succeeding Distribution Date will be adjusted
accordingly.
"Basic Documents" means the Trust Agreement, the Indenture, the Servicing
Agreement, the Administration Agreement, the Sale Agreement, the Purchase
Agreement, the Guarantee Agreements, the Note Depository Agreement, the Interest
Rate Cap Agreement and other documents and certificates delivered in connection
with any such documents.
"Benefit Plan" means (i) an employee benefit plan (as defined in Section
3(3) of ERISA), whether or not subject to the provisions of Title I of ERISA,
(ii) a plan described in Section 4975(e)(1) of the Code, whether or not subject
to Section 4975 of the Code or (iii) any entity whose underlying assets include
plan assets by reason of a plan's investment in the entity.
"Xxxx of Sale" has the meaning specified in the Purchase Agreement or the
Sale Agreement, as applicable.
"Book-Entry Note" means a beneficial interest in the Notes, ownership and
transfers of which shall be made through book entries by a Clearing Agency as
described in Section 2.10 of the Indenture.
"Business Day" means (i) with respect to calculating LIBOR of a specified
maturity, any day on which banks in New York, New York and London, England are
open for the transaction of international business and (ii) for all other
purposes, any day other than a Saturday, a Sunday or a day on which banking
institutions or trust companies in New York, New York or Wilmington, Delaware
are authorized or obligated by law, regulation or executive order to remain
closed.
"Capitalized Interest" means for any Distribution Date through and
including the July 2006 Distribution Date:
(a) if neither of the conditions described in clauses (i) and (ii) of
paragraph (x) in Section 2.8 of the Administration Agreement are in
effect, the amount on deposit in the Capitalized Interest Account on
the Distribution Date following distributions with respect to
clauses (c) and (d) of Section 2.8 of the Administration Agreement,
or
(b) if either of the conditions described in clauses (i) and (ii) of
paragraph (x) in Section 2.8 of the Administration Agreement is in
effect, the excess, if any, of (x) the amount on deposit in the
Capitalized Interest Account on the Distribution Date following
distributions with respect to clause (c) of Section 2.8 of the
Administration Agreement over (y) the Class B Noteholders' Interest
Distribution Amount.
Appendix A-5
"Capitalized Interest Account" means the account designated as such,
established and maintained pursuant to Section 2.3(h) of the Administration
Agreement.
"Capitalized Interest Account Initial Deposit" means $2,000,000.
"Carryover Servicing Fee" has the meaning specified in Attachment A to the
Servicing Agreement.
"Class A Note" means a Class A-1 Note, Class A-2 Note, Class A-3 Note,
Class A-4 Note or Class A-5 Note.
"Class A Note Interest Shortfall" means, for any Distribution Date, the
excess of (x) the Class A Noteholders' Interest Distribution Amount on the
preceding Distribution Date over (y) the amount of interest actually distributed
to the Class A Noteholders on the preceding Distribution Date, plus interest on
the amount of that excess, to the extent permitted by law, at the interest rate
applicable for each such class of Notes from the preceding Distribution Date to
the current Distribution Date.
"Class A Note Principal Shortfall" means, as of the close of any
Distribution Date, the excess of (i) the Class A Noteholders' Principal
Distribution Amount on that Distribution Date, over (ii) the amount of principal
actually distributed to the Class A Noteholders on such Distribution Date.
"Class A Noteholder" means the Person in whose name a Class A Note is
registered in the Note Register.
"Class A Noteholders' Distribution Amount" means, for any Distribution
Date, the sum of the Class A Noteholders' Interest Distribution Amount and the
Class A Noteholders' Principal Distribution Amount for that Distribution Date.
"Class A Noteholders' Interest Distribution Amount" means, for any
Distribution Date, the sum of: (1) the amount of interest accrued at the Class
A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate or the
Class A-5 Rate, as applicable, for the related Accrual Period on the Outstanding
Amount of all classes of Class A Notes on the immediately preceding Distribution
Date(s) after giving effect to all principal distributions to Class A
Noteholders on that preceding Distribution Date or, in the case of the first
Distribution Date, on the Closing Date, and (2) the Class A Note Interest
Shortfall for that Distribution Date.
"Class A Noteholders' Principal Distribution Amount" means, for any
Distribution Date, the Principal Distribution Amount for that Distribution Date,
plus any Class A Note Principal Shortfall as of the close of business on the
preceding Distribution Date; provided that the Class A Noteholders' Principal
Distribution Amount will not exceed the Outstanding Amount of the Class A Notes.
In addition, on the Class A-1 Maturity Date, the Class A-2 Maturity Date, the
Class A-3 Maturity Date, the Class A-4 Maturity Date or the Class A-5 Maturity
Date, as applicable, the principal required to be distributed to the related
Class A Noteholders will include the amount required to reduce the Outstanding
Amount of that class to zero.
"Class A-1 Maturity Date" means the October 2009 Distribution Date.
Appendix A-6
"Class A-2 Maturity Date" means the October 2012 Distribution Date.
"Class A-3 Maturity Date" means the April 2014 Distribution Date.
"Class A-4 Maturity Date" means the January 2017 Distribution Date.
"Class A-5 Maturity Date" means the January 2020 Distribution Date.
"Class A-1 Noteholder" means a Person in whose name a Class A-1 Note is
registered in the Note Register.
"Class A-2 Noteholder" means a Person in whose name a Class A-2 Note is
registered in the Note Register.
"Class A-3 Noteholder" means a Person in whose name a Class A-3 Note is
registered in the Note Register.
"Class A-4 Noteholder" means a Person in whose name a Class A-4 Note is
registered in the Note Register.
"Class A-5 Noteholder" means a Person in whose name a Class A-5 Note is
registered in the Note Register.
"Class A-1 Notes" means the $325,000,000 Floating Rate Class A-1 Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-1 thereto.
"Class A-2 Notes" means the $438,000,000 Floating Rate Class A-2 Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-2 thereto.
"Class A-3 Notes" means the $260,000,000 Floating Rate Class A-3 Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-3 thereto.
"Class A-4 Notes" means the $285,000,000 Floating Rate Class A-4 Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-4 thereto.
"Class A-5 Notes" means the $156,273,000 Floating Rate Class A-5 Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-5 thereto.
"Class A-1 Rate" means, for any Accrual Period after the initial Accrual
Period, Three-Month LIBOR, as determined on the second Business Day before the
beginning of the applicable Accrual Period, minus 0.01 %, based on an Actual/360
accrual method. For the initial Accrual Period, the Class A-1 Rate shall mean
the Initial Accrual Rate minus 0.01 %, based on an Actual/360 accrual method.
Appendix A-7
"Class A-2 Rate" means, for any Accrual Period after the initial Accrual
Period, Three-Month LIBOR, as determined on the second Business Day before the
beginning of the applicable Accrual Period, plus 0.03 % based on an Actual/360
accrual method. For the initial Accrual Period, the Class A-2 Rate shall mean
the Initial Accrual Rate plus 0.03 %, based on an Actual/360 accrual method.
"Class A-3 Rate" means, for any Accrual Period after the initial Accrual
Period, Three-Month LIBOR, as determined on the second Business Day before the
beginning of the applicable Accrual Period, plus 0.09 % based on an Actual/360
accrual method. For the initial Accrual Period, the Class A-3 Rate shall mean
the Initial Accrual Rate plus 0.09 %, based on an Actual/360 accrual method.
"Class A-4 Rate" means, for any Accrual Period after the initial Accrual
Period, Three-Month LIBOR, as determined on the second Business Day before the
beginning of the applicable Accrual Period, plus 0.15 % based on an Actual/360
accrual method. For the initial Accrual Period, the Class A-4 Rate shall mean
the Initial Accrual Rate plus 0.15 %, based on an Actual/360 accrual method.
"Class A-5 Rate" means, for any Accrual Period after the initial Accrual
Period, Three-Month LIBOR, as determined on the second Business Day before the
beginning of the applicable Accrual Period, plus 0.17 % based on an Actual/360
accrual method. For the initial Accrual Period, the Class A-5 Rate shall mean
the Initial Accrual Rate plus 0.17 %, based on an Actual/360 accrual method.
"Class B Maturity Date" means the April 2025 Distribution Date.
"Class B Note Interest Shortfall" means, with respect to any Distribution
Date, the excess of (i) the Class B Noteholders' Interest Distribution Amount on
the preceding Distribution Date over (ii) the amount of interest actually
distributed to the Class B Noteholders on such preceding Distribution Date, plus
interest on the amount of such excess interest due to the Class B Noteholders,
to the extent permitted by law, at the Class B Rate from such preceding
Distribution Date to the current Distribution Date.
"Class B Note Principal Shortfall" means, as of the close of any
Distribution Date, the excess of (i) the Class B Noteholders' Principal
Distribution Amount on such Distribution Date over (ii) the amount of principal
actually distributed to the Class B Noteholders on such Distribution Date.
"Class B Noteholder" means the Person in whose name a Class B Note is
registered in the Note Register.
"Class B Noteholders' Distribution Amount" means, for any Distribution
Date, the sum of the Class B Noteholders' Interest Distribution Amount and the
Class B Noteholders' Principal Distribution Amount for that Distribution Date.
"Class B Noteholders' Interest Distribution Amount" means, for any
Distribution Date, the sum of (1) the amount of interest accrued at the Class B
Rate for the related Accrual Period on the Outstanding Amount of the Class B
Notes on the immediately preceding Distribution
Appendix A-8
Date(s) (or, in the case of the first Distribution Date, the Closing Date),
after giving effect to all principal distributions to Class B Noteholders on
that preceding Distribution Date, and (ii) the Class B Note Interest Shortfall
for that Distribution Date.
"Class B Noteholders' Principal Distribution Amount" means, for any
Distribution Date, the excess of (1) the sum of (a) the Principal Distribution
Amount for such Distribution Date plus (b) the Class A Note Principal Shortfall
as of the close of the preceding Distribution Date plus (c) the Class B Note
Principal Shortfall as of the close of business on the preceding Distribution
Date over (2) the Class A Noteholders' Principal Distribution Amount for that
Distribution Date; provided that the Class B Noteholders' Principal Distribution
Amount will not exceed the Outstanding Amount of the Class B Notes. In addition,
on the Class B Maturity Date, the principal required to be distributed to the
Class B Noteholders will include the amount required to reduce the Outstanding
Amount of the Class B Notes to zero.
"Class B Notes" means the $45,287,000 Floating Rate Class B Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-6 thereto.
"Class B Rate" means, for any Accrual Period after the initial Accrual
Period, Three-Month LIBOR, as determined on the second Business Day before the
beginning of the applicable Accrual Period, plus 0.36% based on an Actual/360
accrual method. For the initial Accrual Period, the Class B Rate shall mean the
Initial Accrual Rate plus 0.36 %, based on an Actual/360 accrual method.
"Clearing Agency" means an organization registered as a "clearing agency"
pursuant to applicable law. The initial Clearing Agency shall be DTC, and the
initial nominee for such Clearing Agency shall be Cede & Co.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Closing Date" means July 28, 2004.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of the
Indenture.
"Collection Account" means the account designated as such, established and
maintained pursuant to Section 2.3(a) of the Administration Agreement.
"Collection Account Initial Deposit" means $34,643,112.43.
"Collection Period" means, with respect to the first Distribution Date,
the period beginning on the Closing Date and ending on September 30, 2004, and
with respect to each subsequent Distribution Date the Collection Period means
the three calendar months immediately following the end of the previous
Collection Period.
Appendix A-9
"Commission" means the Securities and Exchange Commission.
"Consolidation Loans" means Student Loans made in accordance with the
Section 428C of the Higher Education Act.
"Corporate Trust Office" means (i) with respect to the Indenture Trustee,
the principal office of the Indenture Trustee at which at any particular time
its corporate trust business shall be administered, which office at the Closing
Date is located at 00 Xxxx Xxxxxx, 26th Floor, Mailstop XXX00-0000, Xxx Xxxx,
Xxx Xxxx 00000, Attention: Trust & Securities Services/Structured Finance
Services, telephone: (000) 000-0000, facsimile: (000) 000-0000 or at such other
address as the Indenture Trustee may designate from time to time by notice to
the Noteholders and the Depositor, or the principal corporate trust office of
any successor Indenture Trustee (the address of which the successor Indenture
Trustee will notify the Noteholders, the Administrator and the Depositor) and
(ii) with respect to the Eligible Lender Trustee, the principal corporate trust
office of the Eligible Lender Trustee located at Christiana Center/OPS4, 000
Xxxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
Department (telephone: (000) 000-0000; facsimile: (000) 000-0000); or at such
other address as the Eligible Lender Trustee may designate by notice to the
Depositor, or the principal corporate trust office of any successor Eligible
Lender Trustee (the address of which the successor Eligible Lender Trustee will
notify the Administrator and the Depositor).
"Cutoff Date" means July 28, 2004.
"Default" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.10 of the
Indenture.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12, Part V of the
Delaware Code, entitled "Treatment of Delaware Statutory Trusts".
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute
"instruments" within the meaning of Section 9-102(a)(47) of the UCC and
are susceptible of physical delivery, transfer thereof to the Indenture
Trustee or its nominee or custodian by physical delivery to the Indenture
Trustee or its nominee or custodian endorsed to, or registered in the name
of, the Indenture Trustee or its nominee or custodian or endorsed in
blank, and, with respect to a certificated security (as defined in Section
8-102(a)(3) of the UCC) transfer thereof (i) by delivery of such
certificated security endorsed to, or registered in the name of, the
Indenture Trustee or its nominee or custodian or endorsed in blank to a
securities intermediary (as defined in Section 8-102(a)(14) of the UCC)
and the making by such securities intermediary of entries on its books and
records identifying such certificated securities as belonging to the
Indenture Trustee or its nominee or custodian and the sending by such
securities intermediary of a confirmation of the purchase of such
certificated security by the Indenture Trustee or its nominee or
custodian, or (ii) by delivery thereof to a "clearing corporation" (as
defined in Section 8-102(a)(5) of the UCC) and the making by such clearing
corporation of appropriate
Appendix A-10
entries on its books reducing the appropriate securities account of the
transferor and increasing the appropriate securities account of a
securities intermediary by the amount of such certificated security, the
identification by the clearing corporation of the certificated securities
for the sole and exclusive account of the securities intermediary, the
maintenance of such certificated securities by such clearing corporation
or the nominee of either subject to the clearing corporation's exclusive
control, the sending of a confirmation by the securities intermediary of
the purchase by the Indenture Trustee or its nominee or custodian of such
securities and the making by such securities intermediary of entries on
its books and records identifying such certificated securities as
belonging to the Indenture Trustee or its nominee or custodian (all of the
foregoing, but not including Trust Student Loans, "Physical Property");
and such additional or alternative procedures as may hereafter become
appropriate to effect the complete transfer of ownership of any such Trust
Account Property to the Indenture Trustee or its nominee or custodian,
consistent with changes in applicable law or regulations or the
interpretation thereof;
(b) with respect to any security issued by the U.S. Treasury, the
Government National Mortgage Association, the Federal Home Loan Mortgage
Corporation or the Federal National Mortgage Association that is a
book-entry security held at a Federal Reserve Bank pursuant to Federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable Federal regulations and Articles 8
and 9 of the UCC: the crediting of such book-entry security to an
appropriate book-entry account of the Indenture Trustee or its nominee or
the custodian or securities intermediary at a Federal Reserve Bank,
causing the custodian to continuously indicate by book-entry such
book-entry security as credited to the relevant book-entry account, the
continuous crediting of such book-entry security to a securities account
of the custodian at such Federal Reserve Bank and the continuous
identification of such book-entry security by the custodian as credited to
the appropriate book-entry account; and
(c) with respect to any item of Trust Account Property that is an
uncertificated security under Article 8 of the UCC and that is not
governed by clause (b) above, registration on the books and records of the
issuer thereof in the name of the securities intermediary, the sending of
a confirmation by the securities intermediary of the purchase by the
Indenture Trustee or its nominee or custodian of such uncertificated
security, the making by such securities intermediary of entries on its
books and records identifying such uncertificated certificates as
belonging to the Indenture Trustee or its nominee or custodian.
"Department" means the United States Department of Education, an agency of
the Federal government.
"Depositor" means SLM Funding LLC, a Delaware limited liability company,
and its successors and assigns, including, for such purpose, a permitted
transferee of all of SLM Funding LLC's right, title and interest in the Excess
Distribution Certificate.
"Depository Agreement" means the Note Depository Agreement.
"Determination Date" means, with respect to the Collection Period
preceding any Distribution Date, the first Business Day preceding such
Distribution Date.
Appendix A-11
"Distribution Date" means, for any class of Notes the 25th day of each of
January, April, July and October, or, if such day is not a Business Day, the
immediately following Business Day, commencing on October 25, 2004.
"DTC" means The Depository Trust Company, or any successor thereto.
"Eligible Deposit Account" means either (a) a segregated account with an
Eligible Institution or (b) a segregated trust account with the corporate trust
department of a depository institution organized under the laws of the United
States of America or any one of the States or the District of Columbia (or any
domestic branch of a foreign bank), having corporate trust powers and acting as
trustee for funds deposited in such account, so long as any of the securities of
such depository institution have a credit rating from Xxxxx'x, S&P, and, if such
institution is rated by Fitch, Fitch, in one of their generic rating categories
which signifies investment grade.
"Eligible Institution" means a depository institution organized under the
laws of the United States of America or any one of the States or the District of
Columbia (or any domestic branch of a foreign bank) (i) which has (A) either a
long-term senior unsecured debt rating of "AAA" or a short-term senior unsecured
debt or certificate of deposit rating of "A-1+" or better by S&P and (B)(1) a
long-term senior unsecured debt rating of "A1" or better and (2) a short-term
senior unsecured debt rating of "P-1" or better by Moody's, and (C) if such
institution is rated by Fitch, a long-term senior unsecured debt rating of "AA"
or a short-term senior unsecured debt rating of "F-1+," or any other long-term,
short-term or certificate of deposit rating with respect to which the Rating
Agency Condition has been satisfied and (ii) whose deposits are insured by the
FDIC. If so qualified, the Eligible Lender Trustee or the Indenture Trustee may
be considered an Eligible Institution.
"Eligible Investments" means book-entry securities, negotiable instruments
or securities represented by instruments in bearer or registered form which
evidence:
(a) direct obligations of, and obligations fully guaranteed as to timely
payment by, the United States of America, the Government National Mortgage
Association, the Federal Home Loan Mortgage Corporation, the Federal
National Mortgage Association, SLMA, or any agency or instrumentality of
the United States of America the obligations of which are backed by the
full faith and credit of the United States of America; provided that
obligations of, or guaranteed by, the Government National Mortgage
Association (GNMA), the Federal Home Loan Mortgage Corporation (Xxxxxxx
Mac), the Federal National Mortgage Association (Xxxxxx Mae) or SLMA shall
be Eligible Investments only if, at the time of investment, they meet the
criteria of each of the Rating Agencies for collateral for securities
having ratings equivalent to the respective ratings of the Notes in effect
at the Closing Date;
(b) demand deposits, time deposits or certificates of deposit of any
depository institution or trust company incorporated under the laws of the
United States of America or any State (or any domestic branch of a foreign
bank) and subject to supervision and examination by Federal or state
banking or depository institution authorities (including depository
receipts issued by any such institution or trust company as custodian with
respect to any obligation referred to in clause (a) above or portion of
such obligation for the benefit of the holders of such depository
receipts); provided that at the time of the investment or contractual
commitment to invest therein (which shall be deemed to be made again each
time funds are
Appendix A-12
reinvested following each Distribution Date), the commercial paper or
other short-term senior unsecured debt obligations (other than such
obligations the rating of which is based on the credit of a Person other
than such depository institution or trust company) thereof shall have a
credit rating from each of the Rating Agencies in the highest investment
category granted thereby;
(c) commercial paper having, at the time of the investment, a rating from
each of the Rating Agencies in the highest investment category granted
thereby;
(d) investments in money market funds having a rating from each of the
Rating Agencies in the highest investment category granted thereby
(including funds for which the Indenture Trustee, the Administrator or the
Eligible Lender Trustee or any of their respective Affiliates is
investment manager or advisor);
(e) bankers' acceptances issued by any depository institution or trust
company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States of America or any
agency or instrumentality thereof the obligations of which are backed by
the full faith and credit of the United States of America, in either case
entered into with a depository institution or trust company (acting as
principal) described in clause (b) above;
(g) asset-backed securities, including asset-backed securities issued by
Affiliates, or entities formed by Affiliates, of SLMA, but excluding
mortgage-backed securities, that at the time of investment, have a rating
in the highest investment category granted by each of the Rating Agencies,
but not at a purchase price in excess of par;
(h) Eligible Repurchase Obligations; and
(i) any other investment which would not result in the downgrading or
withdrawal of any rating of the Notes by any of the Rating Agencies as
affirmed in writing delivered to the Indenture Trustee.
For purposes of the definition of "Eligible Investments" the phrase "highest
investment category" means (i) in the case of Fitch, "AAA" for long-term
investments (or the equivalent) and "F-1+" for short-term investments (or the
equivalent), (ii) in the case of Moody's, "Aaa" for long-term investments (or
the equivalent) and "P-1" for short-term investments (or the equivalent), and
(iii) in the case of S&P, "AAA" for long-term investments (or the equivalent)
and "A-1+" for short-term investments (or the equivalent). A proposed investment
not rated by Fitch but rated in the highest investment category by Moody's and
S&P shall be considered to be rated by each of the Rating Agencies in the
highest investment category granted thereby.
"Eligible Lender Trustee" means Chase Manhattan Bank USA, National
Association, a national banking association, not in its individual capacity but
solely as Eligible Lender Trustee under the Trust Agreement. "Eligible Lender
Trustee" shall also mean each successor Eligible Lender Trustee as of the
qualification of such successor as Eligible Lender Trustee under the Trust
Agreement.
"Eligible Loans" has the meaning specified in the Purchase Agreement or
the Sale Agreement, as applicable.
Appendix A-13
"Eligible Repo Counterparty" means an institution that is an eligible
lender (under the Federal Family Education Loan Program) or that holds Student
Loans through an eligible lender trustee and whose short-term debt ratings are
not less than "P-1" by Moody's, "A-1" by S&P and "F1" by Fitch, if rated by
Fitch.
"Eligible Repurchase Obligations" means repurchase obligations with
respect to Student Loans serviced by the Servicer or an Affiliate thereof,
entered into with an Eligible Repo Counterparty, provided that the applicable
repurchase date shall occur no later than the Business Day prior to the next
Distribution Date.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"Event of Default" has the meaning specified in Section 5.1 of the
Indenture.
"Excess Distribution Certificate" means the certificate, substantially in
the form of Exhibit A to the Trust Agreement, evidencing the right to receive
payments thereon as set forth in Sections 2.8(m) and 2.9(f) of the
Administration Agreement.
"Excess Distribution Certificate Paying Agent" means any paying agent or
co-paying agent appointed pursuant to Section 3.3(g) of the Trust Agreement,
which paying agent shall initially be the Indenture Trustee.
"Excess Distribution Certificate Register" and "Excess Distribution
Certificate Registrar" mean the register mentioned and the registrar appointed
pursuant to Section 3.3(c) of the Trust Agreement.
"Excess Distribution Certificateholder" means the person in whose name an
Excess Distribution Certificate is registered in the Excess Distribution
Certificate Register.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer, President,
any Executive Vice President, any Senior Vice President, any Vice President, the
Secretary or the Treasurer of such corporation; and with respect to any
partnership, any general partner thereof.
"Expenses" means any and all liabilities, obligations, losses, damages,
taxes, claims, actions and suits, and any and all reasonable costs, expenses and
disbursements (including reasonable legal fees and expenses) of any kind and
nature whatsoever which may at any time be imposed on, incurred by, or asserted
against the Eligible Lender Trustee or any of its officers, directors or agents
in any way relating to or arising out of the Trust Agreement, the other Basic
Documents, the Trust Estate, the administration of the Trust Estate or the
action or inaction of the Eligible Lender Trustee under the Trust Agreement or
the other Basic Documents.
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Funds Rate" means the rate set forth for such day opposite the
caption "Federal Funds (effective)" in the weekly statistical release designated
H.15(519), or any successor
Appendix A-14
publication, published by the Board of Governors of the Federal Reserve System.
If such rate is not published in the relevant H.15(519) for any day, the rate
for such day shall be the arithmetic mean of the rates for the last transaction
in overnight Federal Funds arranged prior to 9:00 a.m. New York City time on
that day by each of four leading brokers in such transactions located in New
York City selected by the Administrator. The Federal Funds rate for each
Saturday and Sunday and for any other that is not a Business Day shall be the
Federal Funds Rate for the preceding Business Day as determined above.
"Fitch" means Fitch, Inc., also known as Fitch Ratings.
"Grant" means mortgage, pledge, bargain, sell, warrant, alienate, remise,
release, convey, assign, transfer, create and xxxxx x xxxx upon and a security
interest in and right of set-off against, deposit, set over and confirm pursuant
to the Indenture. A Grant of the Collateral or of any other agreement or
instrument shall include all rights, powers and options (but none of the
obligations) of the Granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of the Collateral and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
Proceedings in the name of the Granting party or otherwise and generally to do
and receive anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Guarantee Agreement" means any agreement between any Guarantor and the
Eligible Lender Trustee providing for the payment by the Guarantor of amounts
authorized to be paid pursuant to the Higher Education Act to holders of
qualifying Student Loans guaranteed in accordance with the Higher Education Act
by such Guarantor.
"Guarantee Payment" means any payment made by a Guarantor pursuant to a
Guarantee Agreement in respect of a Trust Student Loan.
"Guarantor" means any entity listed on Attachment B (as amended from time
to time) to the Sale Agreement or the Purchase Agreement, as applicable.
"H.15(519)" means the weekly statistical release designated as such, or
any successor publication, published by the Board of Governors of the United
States Federal Reserve System.
"H.15 Daily Update" means the daily update for H.15(519), available
through the world wide web site of the Board of Governors of the Federal Reserve
System at xxxx://xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxx/x00/xxxxxx, or any successor
site or publications.
"Higher Education Act" means the Higher Education Act of 1965, as amended,
together with any rules, regulations and interpretations thereunder.
"Indenture" means the Indenture dated as of July 1, 2004, among the
Eligible Lender Trustee on behalf of the Trust, the Trust and the Indenture
Trustee.
"Indenture Trust Estate" means all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of the Indenture for the benefit
Appendix A-15
of the Noteholders (including all Collateral Granted to the Indenture Trustee),
including all proceeds thereof.
"Indenture Trustee" means Deutsche Bank Trust Company Americas, a New York
banking corporation, not in its individual capacity but solely as trustee under
the Indenture.
"Independent" means, when used with respect to any specified Person, that
the Person (a) is in fact independent of the Trust, any other obligor upon the
Notes, the Depositor and any Affiliate of any of the foregoing Persons, (b) does
not have any direct financial interest or any material indirect financial
interest in the Trust, any such other obligor, the Depositor or any Affiliate of
any of the foregoing Persons and (c) is not connected with the Trust, any such
other obligor, the Depositor or any Affiliate of any of the foregoing Persons as
an officer, employee, promoter, underwriter, placement agent, trustee, partner,
director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be delivered
to the Indenture Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of Section 11.1 of the Indenture,
made by an Independent appraiser or other expert appointed by an Issuer Order
and approved by the Indenture Trustee in the exercise of reasonable care, and
such opinion or certificate shall state that the signer has read the definition
of "Independent" in the Indenture and that the signer is Independent within the
meaning thereof.
"Index Maturity" means, with respect to any Accrual Period, a period of
time equal to three or four months, as applicable, commencing on the first day
of that Accrual Period.
"Initial Accrual Rate" means for each class of Notes and the Accrual
Period commencing on the Closing Date to, but excluding, the first Distribution
Date, the rate per annum as determined on the related Determination Date, as
follows:
X + [27/30 * (Y - X)]
where:
X= Two-Month LIBOR, and
Y = Three-Month LIBOR.
"Initial Pool Balance" means the Pool Balance as of the Statistical Cutoff
Date, which is $1,500,059,926.
"Insolvency Event" means, with respect to a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in an
involuntary case under any applicable Federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its property, or ordering the
winding-up or liquidation of such Person's affairs, which decree or order
remains unstayed and in effect for a period of 60 consecutive days; or (b) the
commencement by such Person of a voluntary case under any applicable Federal or
state bankruptcy, insolvency or other similar law now or hereafter in effect, or
the consent by such
Appendix A-16
Person to the entry of an order for relief in an involuntary case under any such
law, or the consent by such Person to the appointment of or taking possession by
a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or the
making by such Person of any general assignment for the benefit of creditors, or
the failure by such Person generally to pay its debts as such debts become due,
or the taking of action by such Person in furtherance of any of the foregoing.
"Interest Rate Cap Agreement" means the agreement between the Trust and
the Interest Rate Cap Counterparty, dated as of July 20, 2004, documented under
a 1992 ISDA Master Agreement (Multicurrency-Cross Border), including the related
schedule and the Interest Rate Cap Confirmation, providing for certain payments
to the Trust, in the amounts and under the conditions set forth therein, which
will terminate in accordance with its terms on the July 2005 Distribution Date.
"Interest Rate Cap Agreement Upfront Payment" means the "Fixed Rate
Amount" specified in the Interest Rate Cap Confirmation.
"Interest Rate Cap Confirmation" means the confirmation executed under the
Interest Rate Cap Agreement, dated as of July 20, 2004, representing the
interest rate cap in a notional amount of $525,000,000.
"Interest Rate Cap Counterparty" means Xxxxxxx Xxxxx Mitsui Marine
Derivative Products, L.P., as counterparty under the Interest Rate Cap
Agreement.
"Interest Subsidy Payments" means payments, designated as such, consisting
of interest subsidies by the Department in respect of the Trust Student Loans to
the Eligible Lender Trustee on behalf of the Trust in accordance with the Higher
Education Act.
"Interim Eligible Lender Trustee" means Chase Manhattan Bank USA, National
Association, a national banking association, not in its individual capacity but
solely as Interim Eligible Lender Trustee under the Interim Trust Agreement.
"Interim Eligible Lender Trustee" shall also mean each successor Interim
Eligible Lender Trustee as of the qualification of such Interim Eligible Lender
Trustee under the Interim Trust Agreement.
"Interim Trust Agreement" means the Interim Trust Agreement dated as of
July 1, 2004, between the Depositor and the Interim Eligible Lender Trustee.
"Interim Trust Loans" has the meaning set forth in the Interim Trust
Agreement.
"Investment Earnings" means, with respect to any Distribution Date, the
investment earnings (net of losses and investment expenses) on amounts on
deposit in the Trust Accounts to be deposited into the Collection Account on or
prior to such Distribution Date pursuant to Section 2.3(b) of the Administration
Agreement.
"Issuer" means the Trust and, for purposes of any provision contained in
the Indenture and required by the TIA, each other obligor on the Notes.
Appendix A-17
"Issuer Order" and "Issuer Request" means a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Indenture Trustee.
"LIBOR" means Two-Month LIBOR or Three-Month LIBOR, as applicable.
"LIBOR Determination Date" means, for each Accrual Period, the second
Business Day before the beginning of that Accrual Period.
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens and any other liens, if any, which
attach to the respective Trust Student Loan by operation of law as a result of
any act or omission by the related Obligor.
"Liquidated Student Loan" means any defaulted Trust Student Loan
liquidated by the Servicer (which shall not include any Trust Student Loan on
which Guarantee Payments are received) or which the Servicer has, after using
all reasonable efforts to realize upon such Trust Student Loan, determined to
charge off.
"Liquidation Proceeds" means, with respect to any Liquidated Student Loan
which became a Liquidated Student Loan during the current Collection Period in
accordance with the Servicer's customary servicing procedures, the moneys
collected in respect of the liquidation thereof from whatever source, other than
Recoveries, net of the sum of any amounts expended by the Servicer in connection
with such liquidation and any amounts required by law to be remitted to the
Obligor on such Liquidated Student Loan.
"Loan" has the meaning set forth in Section 2 of the Purchase Agreement.
"Minimum Purchase Amount" means an amount that would be sufficient to (i)
reduce the Outstanding Amount of each class of Notes on such Distribution Date
to zero and (ii) pay to the respective Noteholders the Class A Noteholders'
Interest Distribution Amount and the Class B Noteholders' Interest Distribution
Amount payable on such Distribution Date.
"Monthly Servicing Payment Date" means the 25th day of each calendar month
or, if such day is not a Business Day, the immediately following Business Day,
commencing in August 2004.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Note Depository Agreement" means the Letter of Representations, dated
July 28, 2004 among the Trust, the Eligible Lender Trustee and the Indenture
Trustee in favor of DTC.
"Note Final Maturity Date" for a class of Notes means the Class A-1
Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity Date, the
Class A-4 Maturity Date, the Class A-5 Maturity Date or the Class B Maturity
Date, as applicable.
"Note Interest Shortfall" means the Class A Note Interest Shortfall, if
any, and/or the Class B Note Interest Shortfall, if any, as applicable.
Appendix A-18
"Note Owner" means, with respect to a Book-Entry Note, the Person who is
the owner of such Book-Entry Note, as reflected on the books of the applicable
Clearing Agency, or on the books of a Person maintaining an account with such
Clearing Agency (directly as a Clearing Agency Participant or as an indirect
participant, in each case in accordance with the rules of such Clearing Agency).
"Note Pool Factor" means, as of the close of business on a Distribution
Date, a seven-digit decimal figure equal to the Outstanding Amount of a class of
Notes divided by the original Outstanding Amount of such class of Notes. The
Note Pool Factor for each class will be 1.0000000 as of the Closing Date;
thereafter, the Note Pool Factor for each class will decline to reflect
reductions in the Outstanding Amount of that class of Notes.
"Note Rates" means, with respect to any Accrual Period, the Class A-1
Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the Class A-5
Rate and the Class B Rate for such Accrual Period, collectively.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.4 of the Indenture.
"Noteholder" means either a Class A Noteholder or a Class B Noteholder, as
the context requires.
"Notes" means the Class A-1 Notes, the Class A-2 Notes, the Class A-3
Notes, the Class A-4 Notes, the Class A-5 Notes and the Class B Notes,
collectively.
"Obligor" on a Trust Student Loan means the borrower or co-borrowers of
such Trust Student Loan and any other Person who owes payments in respect of
such Trust Student Loan, including the Guarantor thereof and, with respect to
any Interest Subsidy Payment or Special Allowance Payment, if any, thereon, the
Department.
"Officers' Certificate" means (i) in the case of the Trust, a certificate
signed by any two Authorized Officers of the Eligible Lender Trustee, under the
circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.1 of the Indenture, and delivered to the Indenture
Trustee, and (ii) in the case of the Depositor, the Administrator or the
Servicer, a certificate signed by any two Authorized Officers of the Depositor,
the Administrator or the Servicer, as applicable.
"Opinion of Counsel" means (i) with respect to the Trust, one or more
written opinions of counsel who may, except as otherwise expressly provided in
the Indenture, be employees of or counsel to the Eligible Lender Trustee, the
Trust, the Depositor or an Affiliate of the Depositor and who shall be
satisfactory to the Indenture Trustee, and which opinion or opinions shall be
addressed to the Indenture Trustee as Indenture Trustee, shall comply with any
applicable requirements of Section 11.1 of the Indenture and shall be in form
and substance satisfactory to the Indenture Trustee, and (ii) with respect to
the Depositor, the Administrator or the Servicer, one or more written opinions
of counsel who may be an employee of or counsel to the Depositor, the
Administrator or the Servicer, which counsel shall be acceptable to the
Indenture Trustee and the Eligible Lender Trustee.
Appendix A-19
"Origination Fee" means any origination fee payable to the Department by
the lender with respect to any Trust Student Loan.
"Outstanding" means, as of any date of determination, all Notes
theretofore authenticated and delivered under the Indenture except:
(a) Notes theretofore cancelled by the Note Registrar or delivered to the
Note Registrar for cancellation;
(b) Notes or portions thereof, for which payment has been made to the
applicable Noteholders in reduction of the outstanding principal balance
thereof or for which money in the necessary amount has been theretofore
deposited with the Indenture Trustee or any Paying Agent in trust for the
Noteholders thereof (provided, however, that if such Notes are to be
redeemed, notice of such redemption has been duly given pursuant to the
Indenture); and
(c) Notes in exchange for or in lieu of other Notes which have been
authenticated and delivered pursuant to the Indenture unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are
held by a bona fide purchaser; provided that in determining whether the
Noteholders of the requisite Outstanding Amount of the Notes have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder or under any other Basic Document, Notes owned by the Trust, any
other obligor upon the Notes, the Depositor or any Affiliate of any of the
foregoing Persons shall be disregarded and deemed not to be Outstanding,
except that, in determining whether the Indenture Trustee shall be
protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes that a Responsible
Officer of the Indenture Trustee either actually knows to be so owned or
has received written notice thereof shall be so disregarded. Notes so
owned that have been pledged in good faith may be regarded as Outstanding
if the pledgee establishes to the satisfaction of the Indenture Trustee
the pledgee's right so to act with respect to such Notes and that the
pledgee is not the Trust, any other obligor upon the Notes, the Depositor
or any Affiliate of any of the foregoing Persons.
"Outstanding Amount" means, as of any date of determination, the aggregate
principal balance of all the Notes or the applicable class or classes of Notes,
as the case may be, Outstanding at such date of determination.
"Paying Agent" means the Indenture Trustee or any other Person that meets
the eligibility standards for the Indenture Trustee specified in Section 6.11 of
the Indenture and is authorized by the Eligible Lender Trustee on behalf of the
Trust to make the payments to and distributions from the Collection Account and
payments of principal of and interest and any other amounts owing on the Notes
on behalf of the Trust.
"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization, limited liability company, limited
liability partnership or government or any agency or political subdivision
thereof.
"Physical Property" has the meaning assigned to such terms in the
definition of "Delivery" above.
Appendix A-20
"Pool Balance" for any date means the aggregate principal balance of the
Trust Student Loans on that date (including accrued interest that is expected to
be capitalized), as reduced by:
(a) all payments received by the Trust through that date from borrowers,
the Guarantors and the Department;
(b) all amounts received by the Trust through that date from repurchases
of the Trust Student Loans by SLM ECFC or the Depositor, as
applicable, or purchases by the Servicer;
(c) all Liquidation Proceeds and Realized Losses on the Trust Student
Loans liquidated through that date;
(d) the amount of any adjustments to the outstanding principal balances
of the Trust Student Loans that the Servicer makes under the
Servicing Agreement through that date; and
(e) the amount by which Guarantor reimbursements of principal on
defaulted Trust Student Loans through that date are reduced from
100% to 98%, or other applicable percentage, as required by the risk
sharing provisions of the Higher Education Act.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.5 of the Indenture and in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.
"Primary Servicing Fee" for any Monthly Servicing Payment Date has the
meaning specified in Attachment A to the Servicing Agreement, and shall include
any such fees from prior Monthly Servicing Payment Dates that remain unpaid.
"Principal Distribution Amount" means (i) with respect to the initial
Distribution Date, the amount by which the sum of the Outstanding Amount of the
Notes exceeds the Adjusted Pool Balance for that Distribution Date, and (ii)
with respect to each subsequent Distribution Date, the sum of (a) the amount by
which the Adjusted Pool Balance for the preceding Distribution Date exceeds the
Adjusted Pool Balance for that Distribution Date, and (b) any amounts received
under the Interest Rate Cap Agreement for that Distribution Date.
"Proceeding" means any suit in equity, action at law or other judicial or
administrative proceeding.
"Purchase Agreement" means the Purchase Agreement Master Securitization
Terms Number 1000, dated as of July 28, 2004, among SLM ECFC, the Interim
Eligible Lender Trustee and the Depositor, and the purchase agreement or
agreements entered into thereunder.
Appendix A-21
"Purchase Amount" with respect to any Trust Student Loan means the amount
required to prepay in full such Trust Student Loan under the terms thereof
including all accrued interest thereon.
"Purchased Student Loan" means a Trust Student Loan which is, as of the
close of business on the last day of a Collection Period, purchased by the
Servicer pursuant to Section 3.5 of the Servicing Agreement or repurchased by
the Depositor pursuant to Section 6 of the Sale Agreement, repurchased by SLM
ECFC pursuant to Section 6 of the Purchase Agreement or sold to another eligible
lender holding one or more Serial Loans with respect to such Trust Student Loan
pursuant to Section 3.11E of the Servicing Agreement.
"Rating Agency" means Xxxxx'x, S&P and Fitch. If any such organization or
successor thereto is no longer in existence, "Rating Agency" with respect to
such organization shall be a nationally recognized statistical rating
organization or other comparable Person designated by the Administrator, notice
of which designation shall be given to the Indenture Trustee, the Eligible
Lender Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any intended action, that
each Rating Agency then rating a class of Notes shall have been given 10 days'
prior written notice thereof and that each such Rating Agency shall have
notified the Administrator, the Servicer, the Eligible Lender Trustee and the
Indenture Trustee in writing that such proposed action will not result in and of
itself in the reduction or withdrawal of its then current rating of any class of
Notes.
"Realized Loss" means the excess of the principal balance, including any
interest that had been or had been expected to be capitalized, of any Liquidated
Student Loan over Liquidation Proceeds for that Liquidated Student Loan to the
extent allocable to principal, including any interest that had been or had been
expected to be capitalized.
"Record Date" means, with respect to a Distribution Date or Redemption
Date and for each class of Notes, the close of business on the day preceding
such Distribution Date or Redemption Date.
"Recoveries" means moneys collected from whatever source with respect to
any Liquidated Student Loan which was written off in prior Collection Periods or
during the current Collection Period, net of the sum of any amounts expended by
the Servicer for the account of any Obligor and any amounts required by law to
be remitted to any Obligor.
"Redemption Date" means in the case of a payment to Noteholders pursuant
to Section 10.1 of the Indenture, the Distribution Date specified pursuant to
Section 10.1 of the Indenture.
"Redemption Price" means an amount equal to the Outstanding Amount of the
Notes, plus accrued and unpaid interest thereon at the applicable Note Rates to
but excluding the Redemption Date.
"Reference Banks" means four major banks in the London interbank market,
as selected by the Administrator.
Appendix A-22
"Registrar" means the Excess Distribution Certificate Registrar and/or the
Note Registrar, as applicable.
"Reserve Account" means the account designated as such, established and
maintained pursuant to Section 2.3(a) of the Administration Agreement.
"Reserve Account Initial Deposit" means $3,750,150.
"Responsible Officer" means, with respect to the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Assistant Treasurer, Assistant
Secretary, or any other officer of the Indenture Trustee customarily performing
functions similar to those performed by any of the above designated officers,
with direct responsibility for the administration of the Indenture and the other
Basic Documents on behalf of the Indenture Trustee and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc.
"Sale Agreement" means the Sale Agreement Master Securitization Terms
Number 1000, dated as of July 28, 2004, among the Eligible Lender Trustee on
behalf of the Trust, the Trust, the Interim Eligible Lender Trustee and the
Depositor, and the sale agreement or agreements entered into thereunder.
"Schedule of Trust Student Loans" means the listing of the Trust Student
Loans set forth in Schedule A to the Indenture and the Xxxx of Sale (which
Schedule may be in the form of microfiche).
"Serial Loan" means an additional student loan other than a Consolidation
Loan, which is made to a borrower who is also a borrower under at least one
Trust Student Loan.
"Servicer" means Xxxxxx Xxx, Inc., in its capacity as servicer of the
Trust Student Loans.
"Servicer Default" means an event specified in Section 5.1 of the
Servicing Agreement.
"Servicer Distribution Date" has the meaning specified in the Servicing
Agreement.
"Servicer's Report" means any report of the Servicer delivered pursuant to
Section 3.1(a) of the Administration Agreement, substantially in the form
acceptable to the Administrator.
"Servicing Agreement" means the Servicing Agreement dated as of July 28,
2004, among the Trust, the Eligible Lender Trustee, the Servicer, the
Administrator and the Indenture Trustee.
"Servicing Fee" has the meaning specified in Attachment A to the Servicing
Agreement.
"SLMA" means the Student Loan Marketing Association.
Appendix A-23
"SLM ECFC" means SLM Education Credit Finance Corporation.
"SLS Loan" means a Trust Student Loan designated as such that is made
under the Supplemental Loans for Students Program in accordance with the Higher
Education Act.
"Special Allowance Payments" means payments, designated as such,
consisting of effective interest subsidies by the Department in respect of the
Trust Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Specified Reserve Account Balance" means, for any Distribution Date, the
greater of:
(a) 0.25% of the Pool Balance as of the close of business on the last
day of the related Collection Period and
(b) $1,500,060;
provided that in no event will that balance exceed the Outstanding Amount of the
Notes.
"Xxxxxxxx Loan" means a Trust Student Loan designated as such that is made
under the Xxxxxxxx Loan Program in accordance with the Higher Education Act.
"State" means any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx xx Xxxxxxx or
the District of Columbia.
"Statistical Cutoff Date" means July 8, 2004.
"Student Loans" means education loans to students and parents of students
under the Federal Family Education Loan Program.
"Successor Administrator" has the meaning specified in Section 3.7(e) of
the Indenture.
"Successor Servicer" has the meaning specified in Section 3.7(e) of the
Indenture.
"Telerate Page 3750" means the display page so designated on the Moneyline
Telerate Service (or such other page as may replace that page on that service
for the purpose of displaying comparable rates or prices).
"Transfer Date" has the meaning specified in Section 5.2(a) of the
Administration Agreement.
"Three-Month LIBOR" or "Two-Month LIBOR" means, with respect to any
Accrual Period, the London interbank offered rate for deposits in U.S. Dollars
having the Index Maturity which appears on Telerate Page 3750 as of 11:00 a.m.
London time, on the related LIBOR Determination Date. If this rate does not
appear on Telerate Page 3750, the rate for that day will be determined on the
basis of the rates at which deposits in U.S. Dollars, having the Index Maturity
and in a principal amount of not less than U.S. $1,000,000, are offered at
approximately 11:00 a.m., London time, on that LIBOR Determination Date, to
prime banks in the London interbank market by the Reference Banks. The
Administrator will request the principal London
Appendix A-24
office of each Reference Bank to provide a quotation of its rate. If the
Reference Banks provide at least two quotations, the rate for that day will be
the arithmetic mean of the quotations. If the Reference Banks provide fewer than
two quotations, the rate for that day will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Administrator, at
approximately 11:00 a.m., New York time, on that LIBOR Determination Date, for
loans in U.S. Dollars to leading European banks having the Index Maturity and in
a principal amount of not less than U.S. $1,000,000. If the banks selected as
described above are not providing quotations, Three-Month LIBOR in effect for
the applicable Accrual Period will be Three-Month LIBOR in effect for the
previous Accrual Period.
"Treasury Regulations" means regulations, including proposed or temporary
regulations, promulgated under the Code. References in any document or
instrument to specific provisions of proposed or temporary regulations shall
include analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
"Trust" means SLM Student Loan Trust 2004-7, a Delaware statutory trust
established pursuant to the Trust Agreement.
"Trust Account Property" means the Trust Accounts, all cash and
investments held from time to time in any Trust Account (whether in the form of
deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), including the Reserve Account Initial Deposit, the
Capitalized Interest Account Initial Deposit, the Collection Account Initial
Deposit and all earnings on and proceeds of the foregoing.
"Trust Accounts" has the meaning specified in Section 2.3(b) of the
Administration Agreement.
"Trust Agreement" means the short-form trust agreement, dated as of July
9, 2004, between the Depositor and the Eligible Lender Trustee, as amended and
restated pursuant to an Amended and Restated Trust Agreement, dated as of July
28, 2004 among the Depositor, the Eligible Lender Trustee and the Indenture
Trustee.
"Trust Auction Date" has the meaning specified in Section 4.4 of the
Indenture.
"Trust Estate" means all right, title and interest of the Trust (or the
Eligible Lender Trustee on behalf of the Trust) in and to the property and
rights sold, transferred and assigned to the Trust pursuant to the Sale
Agreement, all funds on deposit from time to time in the Trust Accounts and all
other property of the Trust from time to time, including any rights of the
Eligible Lender Trustee and the Trust pursuant to the Trust Agreement, the
Administration Agreement, the Servicing Agreement, the Interest Rate Cap
Agreement and any Eligible Repurchase Obligations.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as in
force on the date hereof, unless otherwise specifically provided.
"Trust Student Loan" means any student loan that is listed on the Schedule
of Trust Student Loans on the Closing Date plus any student loan that is
permissibly substituted for a Trust Student Loan by the Depositor pursuant to
Section 6 of the Sale Agreement or by the
Appendix A-25
Servicer pursuant to Section 3.5 of the Servicing Agreement, but shall not
include any Purchased Student Loan following receipt by or on behalf of the
Trust of the Purchase Amount with respect thereto or any Liquidated Student Loan
following receipt by or on behalf of the Trust of Liquidation Proceeds with
respect thereto or following such Liquidated Student Loan having otherwise been
written off by the Servicer.
"Trust Student Loan Files" means the documents specified in Section 2.1 of
the Servicing Agreement.
"UCC" means, unless the context otherwise requires, the Uniform Commercial
Code, as in effect in the relevant jurisdiction, as amended from time to time.
Appendix A-26
SCHEDULE A
Schedule of Trust Student Loans
[See Schedule A to the Xxxx of Sale
(Attachment C to the Sale Agreement)]
Schedule A-1
SCHEDULE B
Location of Trust Student Loan Files
[See Attachment B to the Servicing Agreement)]
Schedule B-1
EXHIBIT A
[FORM OF NOTES]
(SEE TABS 15.1 THROUGH 16.1)
Exhibit A-1
EXHIBIT B
[Form of Note Depository Agreement
for U.S. Dollar Denominated Notes]
Exhibit B-1
