EXHIBIT 4.1
EXECUTION COPY
INDENTURE
between
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1,
as Issuer
and
U.S. BANK NATIONAL ASSOCIATION,
as Indenture Trustee
Relating To:
The National Collegiate Student Loan Trust 2004-1
Dated as of June 1, 2004
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
Reconciliation and tie between Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act" or "TIA") and this Indenture of Trust, dated as of June 1,
2004.
TRUST INDENTURE ACT SECTION INDENTURE SECTION
Section 310(a)(1) 6.11
Section 310(a)(3) 9.08
Section 310(b) 6.11
Section 313(c) 3.24, 9.07
Section 314(c) 8.13
Section 314(d)(1) 8.13
Section 3.18 9.08
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NOTE: This reconciliation and tie shall not, for any purpose, be deemed
to be a part of the Indenture.
Attention should also be directed to Section 318(c) of the Trust Indenture Act,
which provides that the provisions of Sections 310 to and including 317 of the
Trust Indenture Act are a part of and govern every qualified indenture, whether
or not physically contained therein.
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Usage
SECTION 1.01 Definitions and Usage.......................................................................2
ARTICLE II
The Notes
SECTION 2.01 Form 2
SECTION 2.02 Execution, Authentication and Delivery......................................................3
SECTION 2.03 Temporary Notes.............................................................................3
SECTION 2.04 Registration; Registration of Transfer and Exchange.........................................4
SECTION 2.05 Mutilated, Destroyed, Lost or Stolen Notes.................................................12
SECTION 2.06 Persons Deemed Owner.......................................................................13
SECTION 2.07 Payment of Principal and Interest; Defaulted Interest......................................13
SECTION 2.08 Cancellation...............................................................................14
SECTION 2.09 Release of Collateral......................................................................14
SECTION 2.10 Book-Entry Notes...........................................................................14
SECTION 2.11 Notices to Clearing Agency.................................................................15
SECTION 2.12 Definitive Notes...........................................................................15
SECTION 2.13 Tax Treatment..............................................................................16
ARTICLE III
Covenants
SECTION 3.01 Payment to Noteholders.....................................................................16
SECTION 3.02 Maintenance of Office or Agency............................................................16
SECTION 3.03 Money for Payments To Be Held in Trust.....................................................17
SECTION 3.04 Existence..................................................................................18
SECTION 3.05 Protection of Indenture Trust Estate.......................................................18
SECTION 3.06 Opinions as to Indenture Trust Estate......................................................19
SECTION 3.07 Performance of Obligations; Servicing of Financed Student Loans............................19
SECTION 3.08 Negative Covenants.........................................................................21
SECTION 3.09 Annual Statement as to Compliance..........................................................21
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms........................................21
SECTION 3.11 Successor or Transferee....................................................................23
SECTION 3.12 No Other Business..........................................................................23
SECTION 3.13 No Borrowing...............................................................................23
SECTION 3.14 Disposing of Financed Student Loans........................................................23
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities..........................................24
SECTION 3.16 Capital Expenditures.......................................................................24
SECTION 3.17 Restricted Payments........................................................................25
SECTION 3.18 Notice of Events of Default................................................................25
SECTION 3.19 Further Instruments and Acts...............................................................25
SECTION 3.20 Additional Covenants.......................................................................25
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SECTION 3.21 Covenant Regarding Financed Student Loans..................................................26
SECTION 3.22 Additional Representations of the Issuer...................................................27
SECTION 3.23 Issuer Separateness Covenants..............................................................28
SECTION 3.24 Reports by Issuer..........................................................................29
SECTION 3.25 Rule 144A Information......................................................................30
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01 Satisfaction and Discharge of Indenture....................................................30
SECTION 4.02 Application of Trust Money.................................................................31
SECTION 4.03 Repayment of Moneys Held by Paying Agent...................................................31
ARTICLE V
Remedies
SECTION 5.01 Events of Default..........................................................................31
SECTION 5.02 Acceleration of Maturity; Rescission and Annulment.........................................32
SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee..................33
SECTION 5.04 Remedies; Priorities.......................................................................35
SECTION 5.05 Optional Preservation of the Financed Student Loans........................................38
SECTION 5.06 Limitation of Suits........................................................................38
SECTION 5.07 Unconditional Rights of Noteholders To Receive Principal and Interest......................39
SECTION 5.08 Restoration of Rights and Remedies.........................................................39
SECTION 5.09 Rights and Remedies Cumulative.............................................................40
SECTION 5.10 Delay or Omission Not a Waiver.............................................................40
SECTION 5.11 Control by Noteholders.....................................................................40
SECTION 5.12 Waiver of Past Defaults....................................................................40
SECTION 5.13 Undertaking for Costs......................................................................41
SECTION 5.14 Waiver of Stay or Extension Laws...........................................................41
SECTION 5.15 Action on Notes............................................................................41
SECTION 5.16 Performance and Enforcement of Certain Obligations.........................................41
SECTION 5.17 Notice of Defaults.........................................................................42
ARTICLE VI
The Indenture Trustee
SECTION 6.01 Duties of Indenture Trustee................................................................42
SECTION 6.02 Rights of Indenture Trustee................................................................43
SECTION 6.03 Individual Rights of Indenture Trustee.....................................................44
SECTION 6.04 Indenture Trustee's Disclaimer.............................................................45
SECTION 6.05 Notice of Defaults.........................................................................45
SECTION 6.06 Reports by Indenture Trustee to Noteholders................................................45
SECTION 6.07 Compensation and Indemnity.................................................................45
SECTION 6.08 Replacement of Indenture Trustee...........................................................45
SECTION 6.09 Successor Indenture Trustee by Merger......................................................46
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee..............................................47
SECTION 6.11 Eligibility; Disqualification..............................................................48
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SECTION 6.12 Back-up Certification......................................................................48
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.01 Issuer To Furnish Indenture Trustee Names and Addresses of Noteholders.....................48
SECTION 7.02 Preservation of Information; Communications to Noteholders.................................48
SECTION 7.03 Reports by Issuer..........................................................................49
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.01 Collection of Money........................................................................49
SECTION 8.02 Trust Accounts.............................................................................50
SECTION 8.03 General Provisions Regarding Accounts......................................................56
SECTION 8.04 Release of Indenture Trust Estate..........................................................57
SECTION 8.05 Opinion of Counsel.........................................................................57
SECTION 8.06 Cost of Issuance Account...................................................................57
SECTION 8.07 Application of Collections.................................................................58
SECTION 8.08 Reserve Account............................................................................58
SECTION 8.09 Statements to Noteholders..................................................................59
SECTION 8.10 Pre-Funding Account........................................................................61
SECTION 8.11 Advances...................................................................................61
SECTION 8.12 Future Distribution Account................................................................62
ARTICLE IX
Supplemental Indentures
SECTION 9.01 Supplemental Indentures Without Consent of Noteholders.....................................62
SECTION 9.02 Supplemental Indentures with Consent of Noteholders........................................63
SECTION 9.03 Execution of Supplemental Indentures.......................................................64
SECTION 9.04 Effect of Supplemental Indenture...........................................................64
SECTION 9.05 [Reserved].................................................................................65
SECTION 9.06 Reference in Notes to Supplemental Indentures..............................................65
SECTION 9.07 Conformity With the Trust Indenture Act....................................................65
ARTICLE X
Reporting Requirements
SECTION 10.01 Annual Statement as to Compliance..........................................................65
SECTION 10.02 Annual Independent Public Accountants' Servicing Report....................................65
ARTICLE XI
Miscellaneous
SECTION 11.01 Compliance Certificates and Opinions, etc..................................................65
SECTION 11.02 Form of Documents Delivered to Indenture Trustee...........................................66
SECTION 11.03 Acts of Noteholders........................................................................67
SECTION 11.04 Notices, etc., to Indenture Trustee, Issuer and Rating Agencies............................67
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SECTION 11.05 Notices to Noteholders; Waiver.............................................................68
SECTION 11.06 Alternate Payment and Notice Provisions....................................................68
SECTION 11.07 [Reserved].................................................................................69
SECTION 11.08 Effect of Headings and Table of Contents...................................................69
SECTION 11.09 Successors and Assigns.....................................................................69
SECTION 11.10 Separability...............................................................................69
SECTION 11.11 Benefits of Indenture......................................................................69
SECTION 11.12 Legal Holidays.............................................................................69
SECTION 11.13 Governing Law..............................................................................69
SECTION 11.14 Counterparts...............................................................................69
SECTION 11.15 Recording of Indenture.....................................................................69
SECTION 11.16 Trust Obligations..........................................................................70
SECTION 11.17 No Petition................................................................................70
SECTION 11.18 Inspection.................................................................................70
SECTION 11.19 Third-Party Beneficiaries..................................................................71
APPENDIX A Definitions and Usage
APPENDIX B Provisions Relating to Bearing Interest at an Auction Rate
APPENDIX C Notice of Payment Default
APPENDIX D Notice of Cure of Payment Default
APPENDIX E Notice of Event of Default
APPENDIX F Notice of Waiver/Cure of Event of Default
APPENDIX G Notice of Proposed Change in Auction Period
APPENDIX H Notice Regarding Establishment of Auction Period
APPENDIX I Notice of Change in Auction Date
SCHEDULE A Schedule of Initial Financed Student Loans
SCHEDULE B Schedule of Subsequent Student Loans
SCHEDULE C List of XXXX Guarantee Agreements
SCHEDULE D List of Student Loan Purchase Agreements
EXHIBIT A-1 Form of Class A-1 Note
EXHIBIT A-2 Form of Class A-2 Note
EXHIBIT A-3 Form of Class A-3 Note
EXHIBIT A-4 Form of Class A-4 Note
EXHIBIT A-5 Form of Class A-IO-1 Note
EXHIBIT A-6 Form of Class A-IO-2 Note
EXHIBIT A-7 Form of Class B-1 Note
EXHIBIT A-8 Form of Class B-2 Note
EXHIBIT B Form of Student Loan Acquisition Certificate
EXHIBIT C Form of Transferee Letter
EXHIBIT D Form of Rule 144A Certification
EXHIBIT E Form of Transfer Certificate for Rule 144A Global Note to Regulation S Global Note
during Restricted Period
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EXHIBIT F Form of Transfer Certificate for Rule 144A Global Note to Regulation S Global Note
after Restricted Period
EXHIBIT G Form of Transfer Certificate for Regulation S Global Note to Rule 144A Global Note
during Restricted Period
EXHIBIT H Form of Transfer Certificate for Regulation S Global Note during Restricted Period
EXHIBIT I Indenture Trustee Back-up Certification
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INDENTURE dated as of June 1, 2004, between THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1, a Delaware statutory trust (the "Issuer"), and U.S.
BANK NATIONAL ASSOCIATION, a national banking association, as trustee and not in
its individual capacity (the "Indenture Trustee").
W I T N E S S E T H:
--------------------
WHEREAS, the Issuer is duly created as a statutory trust under the laws
of the State of Delaware and by proper action has duly authorized the execution
and delivery of this Indenture, which Indenture provides for the issuance of
student loan asset-backed notes to finance the acquisition of certain student
loans from The National Collegiate Funding LLC (the "Depositor") and the payment
to holders of the Notes; and
WHEREAS, this Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act" or "TIA"), that are
deemed to be incorporated into this Indenture and shall, to the extent
applicable, be governed by such provisions;
NOW, THEREFORE, 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
Class A-1 Notes (the "Class A-1 Notes"), Class A-2 Notes (the "Class A-2
Notes"), Class A-3 Notes (the "Class A-3 Notes"), Class A-4 Notes (the "Class
A-4 Notes"), 7.87% Class A-IO-1 Notes (the "Class A-IO-1 Notes"), 0.12% Class
A-IO-2 Notes (the "Class A-IO-2 Notes"), Auction Rate Class B-1 Notes (the
"Class B-1 Notes") and Auction Rate Class B-2 Notes (the "Class B-2 Notes" and
together with the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the
Class A-4 Notes, the Class A-IO-1 Notes, Class A-IO-2 Notes and the Class B-1
Notes, the "Notes"):
GRANTING CLAUSE
The Issuer hereby Grants to the Indenture Trustee at the Closing Date, as
trustee for the benefit of the holders of the Notes, all the Issuer's right,
title and interest in and to the following:
(a) the Student Loans, and all obligations of the Obligors
thereunder including all moneys paid thereunder on or after the Cutoff
Date (or, in the case of Subsequent Student Loans, on or after the
related Subsequent Cutoff Date);
(b) all Servicing Agreements and all Student Loan Purchase
Agreements, including the right of the Issuer to cause the Sellers to
repurchase or the Servicers to purchase, Student Loans from the Issuer
under circumstances described therein;
(c) each Guarantee Agreement, including the right of the
Issuer to cause the Guarantee Agency to make Guarantee Payments in
respect of the Student Loans, the XXXX Deposit and Security Agreement
and the XXXX Pledge Fund as the same relate to the Student Loans and
the proceeds thereof, and each of the other Basic Documents;
(d) all funds on deposit from time to time in the Trust
Accounts related to the Notes (and sub-accounts thereof), including the
Reserve Account Initial Deposit and the Pre-Funded Amount; and
(e) 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 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, 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, "Collateral").
The foregoing Grant is made in trust to secure the payment of principal of
and/or interest on, as applicable, and any other amounts owing in respect of,
the Notes, equally and ratably, without prejudice, priority or distinction,
except as otherwise provided for herein, and 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 holders of the
Notes, acknowledges such Xxxxx, 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 holders of the Notes may be adequately and effectively
protected.
ARTICLE I
Definitions and Usage
SECTION 1.01 DEFINITIONS AND USAGE. Except as otherwise
specified herein or as the context may otherwise require, capitalized terms used
but not defined herein are defined in Appendix A and Appendix B hereto, which
also contain rules as to usage that shall be applicable herein.
ARTICLE II
The Notes
SECTION 2.01 FORM. The Notes, together with the Indenture
Trustee's certificate of authentication, shall be in substantially the forms set
forth in Exhibits A-1 through A-8, 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.
Each Note shall be dated the date of its authentication. The terms of the Notes
set forth in Exhibits A-1 through A-8, are part of the terms of this Indenture.
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SECTION 2.02 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 an Issuer Order authenticate and deliver Notes
for original issue in (i) an aggregate principal amount of $189,000,000 with
respect to the Class A-1 Notes, $342,100,000 with respect to the Class A-2
Notes, $105,000,000 with respect to the Class A-3 Notes, $75,000,000 with
respect to the Class A-4 Notes, $39,500,000 with respect to the Class B-1 Notes,
and $39,500,000 with respect to the Class B-2 Notes, and (ii) an aggregate
Notional Amount of $75,000,000 with respect to the Class A-IO-1 Notes and an
aggregate Notional Amount of $75,000,000 with respect to the Class A-IO-2 Notes,
except as provided in Section 2.05. As of any date of determination, the
aggregate Notional Amount of the Class A-IO-1 Notes and the Class A-IO-2 Notes
shall each equal the aggregate principal amount then outstanding of the Class
A-4 Notes; PROVIDED, HOWEVER after the Quarterly Distribution Date occurring in
June 2010, the Notional Amount of the Class A-IO-1 Notes shall equal $0.
Each Note shall be dated the date of its authentication. The Class A Notes shall
be issuable as registered Notes in the minimum denomination of $50,000 principal
amount and in integral multiples of $1,000 in excess thereof. The Class B Notes
shall be issuable as registered Notes in the minimum denomination of $50,000
principal amount and in integral multiples of $50,000 in excess thereof.
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 2.03 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 as the officers executing such Notes may
determine, as evidenced by their execution of such 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 3.02, without charge to the holder of the Notes. 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 initial principal amount or initial Notional Amount, as
applicable, of Definitive Notes of authorized
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denominations. Until so exchanged, the temporary Notes shall in all respects be
entitled to the same benefits under this Indenture as Definitive Notes.
SECTION 2.04 REGISTRATION; REGISTRATION OF TRANSFER AND
EXCHANGE. (a) The Indenture Trustee 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 and exchanges of Notes as herein provided. 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.
(b) If a Person other than the Indenture Trustee is appointed
by the Issuer as Note Registrar, the Issuer will 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
holders of the Notes and the principal amounts or Notional Amounts, as
applicable, and number of such Notes.
(c) The Issuer initially appoints the Indenture Trustee to act
as custodian with respect to the Notes. The Securities Legend shall be placed on
each Private Note.
(d) 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 holder of the Notes thereof or such xxxxxx'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.
(e) No service charge shall be made to a holder of the Notes
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 2.03 or 9.06 not
involving any transfer.
(f) On the Closing Date, the Issuer will execute and the
Indenture Trustee will, upon Issuer Order, authenticate one or more Global Notes
in an aggregate principal amount (or, in the case of the Class A-IO-1 Notes and
Class A-IO-2 Notes, Notional Amount) that shall equal the applicable Original
Principal Balance for each Class of Notes.
The Global Notes, pursuant to the Depository's instructions, shall be
delivered by the Administrator on behalf of the Depository to and deposited with
the DTC Custodian, and shall be registered in the name of Cede & Co. and shall
bear a legend substantially to the following effect:
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"Unless this Note is presented by an authorized representative
of The Depository Trust Company, a New York corporation
("DTC"), to the Issuer or its agent for registration of
transfer, exchange or payment, and any Note issued is
registered in the name of Cede & Co. or in such other name as
is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY
OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner
hereof, Cede & Co.,
has an interest herein."
The Global Notes may be deposited with such other Depository as the
Administrator may from time to time designate, and shall bear such legend as may
be appropriate; PROVIDED that such successor Depository maintains a book-entry
system that qualifies to be treated as "registered form" under Section 163(f) of
the Code.
The Issuer and the Indenture Trustee are hereby authorized to execute and
deliver a Note Depository Agreement with the Depository relating to the Global
Notes.
(g) With respect to Notes registered in the Note Register in
the name of Cede & Co., as nominee of the Depository, the Administrator, the
Owner Trustee and the Indenture Trustee shall have no responsibility or
obligation to Participants or Indirect Participants or Beneficial Owners for
which the Depository holds Notes from time to time as a Depository. Without
limiting the immediately preceding sentence, the Administrator, the Owner
Trustee and the Indenture Trustee shall have no responsibility or obligation
with respect to (a) the accuracy of the records of the Depository, Cede & Co.,
or any Participant or Indirect Participant or Beneficial Owners with respect to
the ownership interest in the Notes, (b) the delivery to any Participant or
Indirect Participant or any other Person, other than a registered Noteholder,
(c) the payment to any Participant or Indirect Participant or any other Person,
other than a registered Noteholder as shown in the Note Register, of any amount
with respect to any distribution of principal or interest on the Notes or (d)
the making of book-entry transfers among Participants of the Depository with
respect to Notes registered in the Note Register in the name of the nominee of
the Depository. No Person other than a registered Noteholder as shown in the
Note Register shall receive a Note evidencing such Note.
(h) Upon delivery by the Depository to the Indenture Trustee
of written notice to the effect that the Depository has determined to substitute
a new nominee in place of Cede & Co., and subject to the provisions hereof with
respect to the payment of distributions by the mailing of checks or drafts to
the registered Noteholder appearing as registered owners in the Note Register on
a Record Date, the name "Cede & Co." in this Indenture shall refer to such new
nominee of the Depository.
(i) Subject to the preceding paragraphs, upon surrender for
registration of transfer of any Note at the office of the Note Registrar and,
upon satisfaction of the conditions set forth below, the Issuer shall execute in
the name of the designated transferee or transferees, a new Note of the same
principal balance or Notional Amount and dated the date of authentication
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by the Indenture Trustee. The Note Registrar shall notify the Administrator and
the Indenture Trustee of any such transfer.
By acceptance of an Individual Note relating to a Private Note, whether
upon original issuance or subsequent transfer, each holder of such a Private
Note acknowledges the restrictions on the transfer of such Private Note set
forth in the Securities Legend and agrees that it will transfer such a Private
Note only as provided herein. The Note Registrar shall register the transfer of
any Individual Note relating to a Private Note if prior to the transfer the
transferee furnishes to the Note Registrar a Transferee Letter in the form of
Exhibit C hereto, provided that, if based upon an Opinion of Counsel to the
effect that the delivery of such Transferee Letter is not sufficient to confirm
that the proposed transfer is being made pursuant to an exemption from, or in a
transaction not subject to, the registration requirements of the Securities Act
and other applicable laws, the Note Registrar may as a condition of the
registration of any such transfer require the transferor to furnish other
certifications, legal opinions or other information prior to registering the
transfer of an Individual Note relating to a Private Note.
(j) Subject to Section 2.04(n), so long as a Global Note
relating to a Private Note remains outstanding and is held by or on behalf of
the Depository, transfers of beneficial interests in the Global Note relating to
a Private Note, or transfers by holders of Individual Notes relating to a
Private Note to transferees that take delivery in the form of beneficial
interests in the Global Note relating to a Private Note, may be made only in
accordance with this Section 2.04(j) and in accordance with the rules of the
Depository.
(i) RULE 144A GLOBAL NOTE TO REGULATION S GLOBAL NOTE DURING
THE RESTRICTED PERIOD. If, during the Restricted Period, a
Beneficial Owner of an interest in a Rule 144A Global Note
wishes at any time to transfer its beneficial interest in such
Rule 144A Global Note to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Regulation S
Global Note, such Beneficial Owner may, in addition to
complying with all applicable rules and procedures of the
Depository and Clearstream or Euroclear applicable to
transfers by their respective participants (the "Applicable
Procedures"), transfer or cause the transfer of such
beneficial interest for an equivalent beneficial interest in
the Regulation S Global Note only upon compliance with the
provisions of this Section 2.04(j)(i). Upon receipt by the
Note Registrar at its Corporate Trust Office of (1) written
instructions given in accordance with the Applicable
Procedures from a Depository Participant directing the Note
Registrar to credit or cause to be credited to another
specified Depository Participant's account a beneficial
interest in the Regulation S Global Note in an amount equal to
the denomination of the beneficial interest in the Rule 144A
Global Note to be transferred, (2) a written order given in
accordance with the Applicable Procedures containing
information regarding the account of the Depository
Participant (and the Euroclear or Clearstream account, as the
case may be) to be credited with, and the account of the
Depository Participant to be debited for, such beneficial
interest, and (3) a certificate in the form of Exhibit E
hereto given by the Beneficial Owner that is transferring such
interest, the Note Registrar shall instruct the Depository to
reduce the denomination of the Rule 144A Global Note by the
denomination of the beneficial interest in the Rule 144A
Global Note to be
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so transferred and, concurrently with such reduction, to
increase the denomination of the Regulation S Global Note by
the denomination of the beneficial interest in the Rule 144A
Global Note to be so transferred, and to credit or cause to be
credited to the account of the Person specified in such
instructions (who shall be a Depository Participant acting for
or on behalf of Euroclear or Clearstream, or both, as the case
may be) a beneficial interest in the Regulation S Global Note
having a denomination equal to the amount by which the
denomination of the Rule 144A Global Note was reduced upon
such transfer.
(ii) RULE 144A GLOBAL NOTE TO REGULATION S GLOBAL NOTE AFTER
THE RESTRICTED PERIOD. If, after the Restricted Period, a
Beneficial Owner of an interest in a Rule 144A Global Note
wishes at any time to transfer its beneficial interest in such
Rule 144A Global Note to a Person who wishes to take delivery
thereof in the form of a beneficial interest in a Regulation S
Global Note, such holder may, in addition to complying with
all Applicable Procedures, transfer or cause the transfer of
such beneficial interest for an equivalent beneficial interest
in a Regulation S Global Note only upon compliance with the
provisions of this Section 2.04(j)(ii). Upon receipt by the
Note Registrar at its Corporate Trust Office of (1) written
instructions given in accordance with the Applicable
Procedures from a Depository Participant directing the Note
Registrar to credit or cause to be credited to another
specified Depository Participant's account a beneficial
interest in the Regulation S Global Note in an amount equal to
the denomination of the beneficial interest in the Rule 144A
Global Note to be transferred, (2) a written order given in
accordance with the Applicable Procedures containing
information regarding the account of the Depository
Participant (and, in the case of a transfer pursuant to and in
accordance with Regulation S, the Euroclear or Clearstream
account, as the case may be) to be credited with, and the
account of the Depository Participant to be debited for, such
beneficial interest, and (3) a certificate in the form of
Exhibit F hereto given by the Beneficial Owner that is
transferring such interest, the Note Registrar shall instruct
the Depository to reduce the denomination of the Rule 144A
Global Note by the aggregate denomination of the beneficial
interest in the Rule 144A Global Note to be so transferred
and, concurrently with such reduction, to increase the
denomination of the Regulation S Global Note by the aggregate
denomination of the beneficial interest in the Rule 144A
Global Note to be so transferred, and to credit or cause to be
credited to the account of the Person specified in such
instructions (who shall be a Depository Participant acting for
or on behalf of Euroclear or Clearstream, or both, as the case
may be) a beneficial interest in the Regulation S Global Note
having a denomination equal to the amount by which the
denomination of the Rule 144A Global Note was reduced upon
such transfer.
(iii) REGULATION S GLOBAL NOTE TO RULE 144A GLOBAL NOTE. If
the Beneficial Owner of an interest in a Regulation S Global
Note wishes at any time to transfer its beneficial interest in
such Regulation S Global Note to a Person who wishes to take
delivery thereof in the form of a beneficial interest in the
Rule 144A Global Note, such holder may, in addition to
complying with all Applicable Procedures, transfer or cause
the transfer of such beneficial interest for an equivalent
7
beneficial interest in the Rule 144A Global Note only upon
compliance with the provisions of this Section 2.04(j)(iii).
Upon receipt by the Note Registrar at its Corporate Trust
Office of (1) written instructions given in accordance with
the Applicable Procedures from a Depository Participant
directing the Note Registrar to credit or cause to be credited
to another specified Depository Participant's account a
beneficial interest in the Rule 144A Global Note in an amount
equal to the denomination of the beneficial interest in the
Regulation S Global Note to be transferred, (2) a written
order given in accordance with the Applicable Procedures
containing information regarding the account of the Depository
Participant to be credited with, and the account of the
Depository Participant (or, if such account is held for
Euroclear or Clearstream, the Euroclear or Clearstream
account, as the case may be) to be debited for such beneficial
interest, and (3) with respect to a transfer of a beneficial
interest in the Regulation S Global Note for a beneficial
interest in the related Rule 144A Global Note (i) during the
Restricted Period, a certificate in the form of Exhibit G
hereto given by the Beneficial Owner, or (ii) after the
Restricted Period, a Rule 144A Certification in the form of
Exhibit D hereto from the transferee to the effect that such
transferee is a Qualified Institutional Buyer, the Note
Registrar shall instruct the Depository to reduce the
denomination of the Regulation S Global Note by the
denomination of the beneficial interest in the Regulation S
Global Note to be transferred, and, concurrently with such
reduction, to increase the denomination of the Rule 144A
Global Note by the aggregate denomination of the beneficial
interest in the Regulation S Global Note to be so transferred,
and to credit or cause to be credited to the account of the
Person specified in such instructions (who shall be a
Depository Participant acting for or on behalf of Euroclear or
Clearstream, or both, as the case may be) a beneficial
interest in the Rule 144A Global Note having a denomination
equal to the amount by which the denomination of the
Regulation S Global Note was reduced upon such transfer.
(iv) TRANSFERS WITHIN REGULATION S GLOBAL NOTES DURING
RESTRICTED PERIOD. If, during the Restricted Period, the
Beneficial Owner of an interest in a Regulation S Global Note
wishes at any time to transfer its beneficial interest in such
Certificate to a Person who wishes to take delivery thereof in
the form of a Regulation S Global Note, such Beneficial Owner
may transfer or cause the transfer of such beneficial interest
for an equivalent beneficial interest in such Regulation S
Global Note only upon compliance with the provisions of this
Section 2.04(j)(iv) and all Applicable Procedures. Upon
receipt by the Note Registrar at its Corporate Trust Office of
(1) written instructions given in accordance with the
Applicable Procedures from a Depository Participant directing
the Note Registrar to credit or cause to be credited to
another specified Depository Participant's account a
beneficial interest in such Regulation S Global Note in an
amount equal to the denomination of the beneficial interest to
be transferred, (2) a written order given in accordance with
the Applicable Procedures containing information regarding the
account of the Depository Participant to be credited with, and
the account of the Depository Participant (or, if such account
is held for Euroclear or Clearstream, the Euroclear or
Clearstream account, as the case may be) to be debited for,
such beneficial interest and (3) a
8
certificate in the form of Exhibit H hereto given by the
transferee, the Note Registrar shall instruct the Depository
to credit or cause to be credited to the account of the Person
specified in such instructions (who shall be a Depository
Participant acting for or on behalf of Euroclear or
Clearstream, or both, as the case may be) a beneficial
interest in the Regulation S Global Note having a denomination
equal to the amount specified in such instructions by which
the account to be debited was reduced upon such transfer. The
Note Registrar shall not be required to monitor compliance by
Beneficial Owners of the provisions of this Section
2.04(j)(iv).
(k) Any and all transfers from a Global Note relating to a
Private Note to a transferee wishing to take delivery in the form of an
Individual Note relating to a Private Note will require the transferee to take
delivery subject to the restrictions on the transfer of such Individual Note
relating to a Private Note described on the face of such Note, and such
transferee agrees that it will transfer such Individual Note relating to a
Private Note only as provided therein and herein. No such transfer shall be made
and the Note Registrar shall not register any such transfer unless such transfer
is made in accordance with this Section 2.04(k).
(i) Transfers of a beneficial interest in a Global
Note relating to a Private Note to a Qualified Institutional Buyer or a
Regulation S Investor wishing to take delivery in the form of an
Individual Note relating to a Private Note will be registered by the
Note Registrar only upon compliance with the provisions of Section
2.04(j) and if the Note Registrar is provided with a Rule 144A
Certification or a Regulation S Transfer Certificate, as applicable.
(ii) Notwithstanding the foregoing, no transfer of a
beneficial interest in a Regulation S Global Note to an Individual Note
relating to a Private Note shall be made prior to the expiration of the
Restricted Period. Upon acceptance for exchange or transfer of a
beneficial interest in a Global Note for an Individual Note relating to
a Private Note, as provided herein, the Note Registrar shall endorse on
the schedule affixed to the related Global Note (or on a continuation
of such schedule affixed to such Global Note and made a part thereof)
an appropriate notation evidencing the date of such exchange or
transfer and a decrease in the denomination of such Global Note equal
to the denomination of such Individual Note relating to a Private Note
issued in exchange therefor or upon transfer thereof. Unless determined
otherwise by the Administrator in accordance with applicable law, an
Individual Note relating to a Private Note issued upon transfer of or
exchange for a beneficial interest in the Global Note shall bear the
Securities Legend.
(l) TRANSFERS OF INDIVIDUAL NOTE TO THE GLOBAL NOTES. If a
Holder of an Individual Note relating to a Private Note wishes at any time to
transfer such Note to a Person who wishes to take delivery thereof in the form
of a beneficial interest in the related Regulation S Global Note or the related
Rule 144A Global Note, such transfer may be effected only in accordance with the
Applicable Procedures, and this Section 2.04(l). Upon receipt by the Note
Registrar at the Corporate Trust Office of (1) the Individual Note relating to a
Private Note to be transferred with an assignment and transfer, (2) written
instructions given in accordance with the Applicable Procedures from a
Depository Participant directing the Note Registrar to
9
credit or cause to be credited to another specified Depository Participant's
account a beneficial interest in such Regulation S Global Note or such Rule 144A
Global Note, as the case may be, in an amount equal to the denomination of the
Individual Note to be so transferred, (3) a written order given in accordance
with the Applicable Procedures containing information regarding the account of
the Depository Participant (and, in the case of any transfer pursuant to
Regulation S, the Euroclear or Clearstream account, as the case may be) to be
credited with such beneficial interest, and (4) (x) if delivery is to be taken
in the form of a beneficial interest in the Regulation S Global Note, a
Regulation S Transfer Certificate from the transferor or (y) a Rule 144A
Certification from the transferee to the effect that such transferee is a
Qualified Institutional Buyer, if delivery is to be taken in the form of a
beneficial interest in the Rule 144A Global Note, the Note Registrar shall
cancel such Individual Note relating to a Private Note, the Issuer shall execute
and the Indenture Trustee shall authenticate and deliver a new Individual Note
relating to a Private Note for the denomination of the Individual Note not so
transferred, registered in the name of the Holder, and the Note Registrar shall
instruct the Depository to increase the denomination of the Regulation S Global
Note or the Rule 144A Global Note, as the case may be, by the denomination of
the Individual Note to be so transferred, and to credit or cause to be credited
to the account of the Person specified in such instructions (who, in the case of
any increase in the Regulation S Global Note during the Restricted Period, shall
be a Depository Participant acting for or on behalf of Euroclear or Clearstream,
or both, as the case may be) a corresponding denomination of the Rule 144A
Global Note or the Regulation S Global Note, as the case may be.
It is the intent of the foregoing that under no circumstances may an investor
that is not a Qualified Institutional Buyer or a Regulation S Investor take
delivery in the form of a beneficial interest in a Global Note relating to a
Private Note or an Individual Note relating to a Private Note.
(m) An exchange of a beneficial interest in a Global Note for
an Individual Note or Notes, an exchange of an Individual Note or Notes for a
beneficial interest in a Global Note and an exchange of an Individual Note or
Notes for another Individual Note or Notes (in each case, whether or not such
exchange is made in anticipation of subsequent transfer, and in the case of the
Global Notes, so long as the Global Notes remain outstanding and are held by or
on behalf of the Depository), may be made only in accordance with this Section
2.04 and in accordance with the rules of the Depository and Applicable
Procedures.
(n) (i) Upon acceptance for exchange or transfer of an
Individual Note relating to a Private Note for a beneficial interest in the
Global Note as provided herein, the Note Registrar shall cancel such Individual
Note and shall (or shall request the Depository to) endorse on the schedule
affixed to the applicable Global Note (or on a continuation of such schedule
affixed to the Global Note and made a part thereof) an appropriate notation
evidencing the date of such exchange or transfer and an increase in the Note
balance of the Global Note equal to the Note balance of such Individual Note
exchanged or transferred therefor.
(ii) Upon acceptance for exchange or transfer of a
beneficial interest in the Global Note for an Individual Note relating
to a Private Note as provided herein, the Note Registrar shall (or
shall request the Depository to) endorse on the schedule affixed to the
Global Note (or on a continuation of such schedule affixed to the
Global Note and
10
made a part thereof) an appropriate notation evidencing the date of
such exchange or transfer and a decrease in the Note balance of the
Global Note equal to the Note balance of such Individual Note issued in
exchange therefor or upon transfer thereof.
(o) The Securities Legend shall be placed on any Individual
Note relating to a Private Note issued in exchange for or upon transfer of
another Individual Note relating to a Private Note or of a beneficial interest
in the Global Note.
No transfer of any Private Note shall be made unless such transfer is exempt
from the registration requirements of the Securities Act and any applicable
state securities laws or is made in accordance with said Act and laws. No
transfer of any Private Note shall be made if such transfer would require the
Issuer to register as an "investment company" under the Investment Company Act
of 1940, as amended. In the event of any such transfer, unless such transfer is
made in reliance on Rule 144A under the Securities Act or Regulation S under the
Securities Act, (i) the Indenture Trustee may require a written Opinion of
Counsel (which may be in-house counsel) acceptable to and in form and substance
reasonably satisfactory to the Indenture Trustee that such transfer may be made
pursuant to an exemption, describing the applicable exemption and the basis
therefor, from said Act and laws or is being made pursuant to said Act and laws,
which Opinion of Counsel shall not be an expense of the Indenture Trustee or the
Trust and (ii) the Indenture Trustee shall require the transferee to execute a
Transferee Letter certifying to the Issuer and the Indenture Trustee the facts
surrounding such transfer, which Transferee Letter shall not be an expense of
the Indenture Trustee, or the Trust. The holder of a Private Note desiring to
effect such transfer shall, and does hereby agree to, indemnify the Indenture
Trustee, and the Trust against any liability that may result if the transfer is
not so exempt or is not made in accordance with such federal and state laws.
None of the Issuer, the Indenture Trustee or the Trust intends or is obligated
to register or qualify any Private Note under the Securities Act or any state
securities laws.
No Note may be acquired directly or indirectly by a fiduciary of, on
behalf of, or with "Plan Assets" (within the meaning of Section 2510.3-101 of
the U.S. Department of Labor regulations (the "Plan Asset Regulation")) of, an
"employee benefit plan" as defined in Section 3(3) of ERISA, a "plan" within the
meaning of Section 4975 of the Code or any other entity whose underlying assets
include Plan Assets by reason of any plan's investment in the entity, which is
subject to Title I of ERISA or Section 4975 of the Code (a "Plan"), unless (i)
such Note is rated investment grade or better as of the date of purchase, (ii)
the transferee of the Note believes that the Note is properly treated as
indebtedness without substantial equity features for purposes of the Plan Asset
Regulation and agrees to so treat such Note and (iii) the acquisition and
holding of the Note do not result in a violation of the prohibited transaction
rules of ERISA or Section 4975 of the Code (A) because it is covered by an
applicable exemption, including Prohibited Transaction Class Exemption 96-23,
95-60, 91-38, 90-1 or 84-14, or (B) by reason of the Trust, the Administrator,
the Underwriters, the Servicers, the Indenture Trustee, the Owner Trustee, any
provider of credit support or any of their affiliates not being a "Party in
Interest" (within the meaning of Section 3(14) of ERISA) with respect to such
Plan. No transfer of a Note shall be made unless the Indenture Trustee shall
have received a certification from the transferee of such Note, acceptable to
and in form and substance satisfactory to the Indenture Trustee and the Issuer,
to the effect that such transferee is acquiring a Note in conformance with the
requirements of the preceding sentence. Notwithstanding anything else to the
contrary herein, in
11
the event any purported transfer of any Note is made without delivery of the
certification referred to above, such certification shall be deemed to have been
made by the transferee by its acceptance of a Note.
Notwithstanding any other provision of this Indenture to the contrary,
no transfer, sale, pledge or other disposition of one or more Class A-4 Notes,
Class A-IO-1 Notes or Class A-IO-2 Notes (a "Transfer") shall be made unless
simultaneously with the Transfer (1) a proportionate amount of Class A-IO-1
Note, Class A-IO-2 Notes and Class A-4 Notes are Transferred so that the ratio
of the Notional Amount of the Class A-IO-1 Notes so Transferred to the Notional
Amount of all Class A-IO-1 Notes, the ratio of the Notional Amount of the Class
A-IO-2 Notes so Transferred to the Notional Amount of all Class A-IO-2 Notes,
and the ratio of the principal amount of the Class A-4 Notes so Transferred to
the principal amount of all Class A-4 Notes are equal and (2) the Transfers of
the Class A-IO-1 Notes, the Class A-IO-2 Notes and the Class A-4 Notes referred
to herein are made to the same Person.
The Indenture Trustee shall have no obligation or duty to monitor,
determine or inquire as to compliance with any restrictions on transfer imposed
under this Indenture or under applicable law with respect to any transfer of any
interest in any Note (including any transfers between or among Participants,
members or Beneficial Owners in any Note) other than to require delivery of such
certificates and other documentation or evidence as are expressly required by,
and to do so if and when expressly required by, the terms of this Indenture, and
to examine the same to determine substantial compliance as to form with the
express requirements hereof.
SECTION 2.05 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 Indenture Trustee such security
or indemnity as may be required by it 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 instead of
issuing a replacement Note, the Issuer may pay such destroyed, lost or stolen
Note when so due or payable 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 holder of the Notes thereof of a sum sufficient to
cover any tax or other
12
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 2.06 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 (with respect to
each Class of Notes other than the Class A-IO Notes) and interest on such Note
and for all other purposes whatsoever, whether or not such Note be overdue, and
neither the Issuer or the Indenture Trustee nor any agent of the Issuer or the
Indenture Trustee shall be affected by notice to the contrary.
SECTION 2.07 PAYMENT OF PRINCIPAL AND INTEREST; DEFAULTED
INTEREST. (a) The Class A Notes shall accrue interest as provided in the
applicable form of such Class set forth in Exhibits A-1 through A-6
respectively, and each other Class of Notes shall accrue interest as provided in
Appendix B, and such interest accrued on each Class of Notes shall be payable on
each applicable Distribution Date as specified therein, subject to Section 3.01.
Any installment of interest or principal, if any, with respect to each Class of
Notes payable on any applicable 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 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
Clearing Agency (initially, such nominee to be Cede & Co.), payment will 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 to such Note on a Distribution Date or on the applicable Note Final
Maturity Date which shall be payable as provided below. The funds represented by
any such checks returned undelivered shall be held in accordance with Section
3.03.
(b) The principal of each Note, other than the Class A-IO
Notes, shall be payable in installments on each Distribution Date as provided in
the applicable form of Note set forth in Exhibits A-1 through A-8, respectively,
to the extent the amount of funds required and available to be distributed in
respect of principal on such Class of Notes pursuant to the terms of this
Indenture; PROVIDED, HOWEVER, the entire unpaid principal amount of each Class
of Notes, other than the
13
Class A-IO Notes, shall be due and payable on its respective Final Maturity
Date. Notwithstanding the foregoing, the entire unpaid principal amount of the
Notes, other than the Class A-IO Notes, shall be due and payable, if not
previously paid, on the date on which an Event of Default shall have occurred
and is continuing, if the Indenture Trustee or the Interested Noteholders
holding a majority of the Outstanding Amount of the related Classes of Notes
have declared the Notes to be immediately due and payable in the manner provided
in Section 5.02. All principal payments on each Class of Class A Notes, other
than the Class A-IO Notes, shall be made pro rata to the holders of such Class
of Notes entitled thereto. All principal payments on each Class of Auction Rate
Notes shall be made as described in Appendix B hereto and, with respect to each
Class of Auction Rate Notes receiving a principal payment, the Trustee shall
select the Outstanding Auction Rate Notes of such Class to receive principal
payments by lot, or in its discretion, on a pro rata basis. 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 any
Class of Notes 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.
(c) If the Issuer defaults in a payment of interest on any
Class of the Notes, the Issuer shall pay defaulted interest (plus interest on
such defaulted interest to the extent lawful) at the applicable Note Interest
Rate in any lawful manner. The Issuer shall pay such defaulted interest to the
persons who are holders of such Class or Classes of Notes on a subsequent
special record date, which date shall be at least three Business Days prior to
the payment date. The Issuer shall fix or cause to be fixed any such special
record date and payment date, and, at least 15 days before any such special
record date, the Issuer shall mail to each holder of the affected Class or
Classes of Notes and the Indenture Trustee a notice that states the special
record date, the payment date and the amount of defaulted interest to be paid.
SECTION 2.08 CANCELLATION. All Notes surrendered for payment,
registration of transfer or exchange 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 cancelled 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 2.09 RELEASE OF COLLATERAL. Subject to Section 11.01
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.
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
14
The Depository Trust Company, the initial Clearing Agency, by, 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 will receive a Definitive Note (as defined below) representing such Note
Owner's interest in such Note, except as provided in Section 2.12. Unless and
until definitive, fully registered Notes (the "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 may
deal with the 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 Clearing Agency and shall be limited to those
established by law and agreements between such Note Owners and the
Clearing Agency and/or the Clearing Agency Participants pursuant to the
Note Depository Agreements. Unless and until Definitive Notes are
issued pursuant to Section 2.12, the initial Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive
and transmit payments of principal of and interest and other amounts on
the Notes to such Clearing Agency Participants; and
(v) whenever this Indenture requires or permits
actions to be taken based upon instructions or directions of the
holders of the Notes evidencing a specified percentage of the
Outstanding Amount of the Notes, the 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 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.
SECTION 2.11 NOTICES TO CLEARING AGENCY. Whenever a notice or
other communication to the holders of the Notes is required under this
Indenture, unless and until Definitive Notes shall have been issued to Note
Owners pursuant to Section 2.12, the Indenture Trustee shall give all such
notices and communications specified herein to be given to the holders of the
Notes to the Clearing Agency.
SECTION 2.12 DEFINITIVE NOTES. If (i) the Administrator
advises the Indenture Trustee in writing that the Clearing Agency is no longer
willing or able to properly discharge its responsibilities with respect to the
Notes, and the Administrator is unable to locate a qualified successor, (ii)
circumstances change so that the book-entry system through the Clearing Agency
is less advantageous due to economic or administrative burden or the use of the
book-entry system becomes unlawful with respect to the Notes or the Issuer
notifies the Indenture Trustee in writing that because of the change in
circumstances the Issuer is terminating the book-entry system with respect to
the Notes or (iii) after the occurrence of an Event of Default, Note Owners
15
representing beneficial interests aggregating at least a majority of the
Outstanding Amount of such Class of Notes advise the Clearing Agency (which
shall then notify the Indenture Trustee) in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Note Owners of such Class of Notes, then the Indenture Trustee will cause
the Clearing Agency to notify all Note Owners of such Class of Notes, through
the Clearing Agency, of the occurrence of any such event and of the availability
of Definitive Notes to such Note Owners requesting the same. Upon surrender to
the Indenture Trustee of the typewritten Notes representing the Book-Entry Notes
by the 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 the Clearing Agency. 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 the Noteholders for such Class of Notes.
SECTION 2.13 TAX TREATMENT. The Issuer has entered into this
Indenture, and the Notes will be issued, with the intention that, for federal,
state and local income, business and franchise tax purposes, the Notes will
qualify as indebtedness of the Issuer. The Issuer, by entering into this
Indenture, and each Noteholder, by its acceptance of its Note, agree to treat
the Notes for federal, state and local income, business and franchise tax
purposes as indebtedness of the Issuer.
ARTICLE III
Covenants
SECTION 3.01 PAYMENT TO NOTEHOLDERS. The Issuer will duly and
punctually pay the principal of and interest owing on each Class of Notes
pursuant to the terms of this Indenture. Without limiting the foregoing, subject
to Section 8.02, the Issuer will cause to be distributed to the holders of the
each Class of Notes that portion of the amounts on deposit in the Trust Accounts
on a Distribution Date, to which the holders of each Class of Notes are entitled
to receive pursuant to the terms of this Indenture. Amounts properly withheld
under the Code by any Person from a payment to any holder of the Notes of
interest on and/or principal of shall be considered as having been paid by the
Issuer to such holder of the applicable Notes for all purposes of this
Indenture. The Notes will be non-recourse obligations of the Issuer and shall be
limited in right of payment to amounts available from the Indenture Trust Estate
as provided in this Indenture and the Issuer shall not be otherwise liable on
the Notes.
SECTION 3.02 MAINTENANCE OF OFFICE OR AGENCY. The Issuer will
maintain in the Borough of Manhattan, The City of New York, an office or agency
where Notes may be surrendered for registration of transfer or exchange. The
Issuer hereby initially designates U.S. Bank National Association, U.S. Bank
Trust New York, 000 Xxxx Xxxxxx, Xxxxx 0000, Xxx Xxxx, Xxx Xxxx 00000 to serve
as its agent for the foregoing purposes. The Issuer will 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 may be made
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or served at the Corporate Trust Office, and the Issuer hereby appoints the
Indenture Trustee as its agent to receive all such surrenders in respect of the
Notes.
SECTION 3.03 MONEY FOR PAYMENTS TO BE HELD IN TRUST. As
provided in Section 8.02, 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 any other Trust Account pursuant to Section 8.02 shall be made on
behalf of the Issuer by the Indenture Trustee or by another Paying Agent, and no
amounts so distributed from the Collection Account for payments of Notes shall
be paid over to the Issuer except as provided in this Section. The Indenture
Trustee is hereby appointed as the initial "Paying Agent" hereunder and the
Indenture Trustee hereby accepts such appointment.
On or before the Business Day next preceding each Distribution 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 each Class of 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 will 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 each Class of 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 any Class of 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 payment of each applicable Class of 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 Class of
the Notes of any applicable withholding taxes imposed thereon and with
respect to any applicable reporting requirements in connection
therewith.
The Administrator may at any time, for the purpose of obtaining the satisfaction
and discharge of this Indenture or for any other purpose, by written order
direct any Paying Agent to pay to the
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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 payable shall be discharged from such trust and be
paid to the Issuer on Issuer Request; and the holder of such Notes 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, 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.
SECTION 3.04 EXISTENCE. The Issuer will keep in full effect
its existence, rights and franchises as a 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 will keep in full effect its existence, rights and
franchises under the laws of such other jurisdiction) and will 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 3.05 PROTECTION OF INDENTURE TRUST ESTATE. The Issuer
will from time to time execute and deliver all such supplements and amendments
hereto and all such financing statements, continuation statements, instruments
of further assurance and other instruments, 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 holders of the
Notes 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 3.06 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, any
indentures supplemental hereto, and any other requisite documents, and with
respect to the execution and filing of any financing statements and continuation
statements, as are 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 April 30 in each calendar year, beginning in
2005, 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, any indentures supplemental hereto and any other requisite documents
and with respect to the execution and filing of any financing statements and
continuation statements as is necessary to maintain the lien and security
interest created by this Indenture and reciting 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, re-recording and refiling of this Indenture, any
indentures supplemental hereto and any other requisite documents and the
execution and filing of any financing statements and continuation statements
that will, in the opinion of such counsel, be required to maintain the lien and
security interest of this Indenture until April 30 in the following calendar
year.
SECTION 3.07 PERFORMANCE OF OBLIGATIONS; SERVICING OF FINANCED
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 or the other Basic
Documents.
(b) Although the Issuer will contract with other Persons to
assist it in performing its duties under this Indenture, 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.
Initially, the Issuer has contracted with the Servicers and the Administrator to
assist the Issuer in performing its duties under this Indenture.
(c) The Issuer will enforce all of its rights under this
Indenture and the Basic Documents, including, without limitation, enforcing the
covenants and agreements of the Depositor in the Deposit and Sale Agreement
(including covenants to the effect that the Depositor will enforce covenants
against the Sellers under the Student Loan Purchase Agreements), and will
punctually perform and observe all of its obligations and agreements contained
in this Indenture, the other Basic Documents and in the instruments and
agreements
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included in the Indenture Trust Estate, including filing or causing to be filed
all UCC financing statements and continuation statements required to be filed by
the terms of this Indenture 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
and the Interested Noteholders holding a majority of the Outstanding Amount of
the related Classes of Notes).
(d) If the Issuer shall have knowledge of the occurrence of a
Servicer Default or an Administrator Default, 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 a 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 Financed 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) Upon any partial or complete termination of the Servicer's
rights and powers pursuant to a 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 the
Rating Agencies. As soon as a successor Servicer or a successor Administrator is
appointed, the Issuer shall notify the Indenture Trustee and the Rating Agencies
of such appointment, specifying in such notice the name and address of such
Successor Servicer or such Successor Administrator.
(f) 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 and the Interested
Noteholders holding a majority of the Outstanding Amount of the Related Classes
of 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 therein, or waive timely performance or observance by the
Servicers, the Administrator, the Depositor, the Issuer or the Owner Trustee
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, collections of payments with respect to Student Loans or
distributions that shall be required to be made for the benefit of the holders
of Notes, (ii) amend the aforesaid percentage of the Outstanding Amount of the
related Class or Classes of Notes, which are required to consent to any such
amendment, without the consent of all outstanding holders of all Classes of
Notes affected by such amendment. If any such amendment, modification,
supplement or waiver shall be so consented to by the Indenture Trustee and such
holders of the Notes, the Issuer 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.
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SECTION 3.08 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 pursuant to the terms hereof;
(ii) claim any credit on, or make any deduction from
the principal or interest payable in respect of, the applicable 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 holder of the Notes by reason of the payment of the taxes levied
or assessed upon any part of the Indenture Trust Estate; or
(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, in each case arising solely as a result
of an action or omission of the related Obligor, 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.
SECTION 3.09 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer
will deliver to the Indenture Trustee, on or before March 15 of each year,
commencing March 15, 2005, an Officers' Certificate of the Issuer stating that:
(i) a review of the activities of the Issuer during
the previous calendar 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
21
to the Indenture Trustee, the due and punctual payment of the principal
of and interest on each Class of 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;
(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 tax consequence to the Issuer, any holder of the Notes
or any holder of the Certificates;
(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.
(b) The Issuer shall not convey or transfer all or
substantially all 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 assumes, 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 on each Class of 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 agrees 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 holders of the Notes
and (D) unless otherwise provided in such supplemental indenture,
expressly agrees 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;
(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;
22
(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 tax consequence to the Issuer, any holder of the Notes
or any holder of the Certificates;
(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.
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), The National Collegiate
Student Loan Trust 2004-1 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 The National Collegiate Student
Loan Trust 2004-1 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 servicing the
Financed Student Loans and making Additional Fundings in the manner contemplated
by this Indenture and the other Basic Documents and activities incidental
thereto.
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 DISPOSING OF FINANCED STUDENT LOANS. Other than
pursuant to Article V, Financed Student Loans may only be sold, transferred,
exchanged or otherwise disposed of by the Indenture Trustee free from the lien
of this Indenture (i) for transfer to a Guarantee Agency pursuant to the terms
of the applicable Guarantee Agreement; (ii) to a Seller or the Depositor in
accordance with the applicable Student Loan Purchase Agreement or the Deposit
and Sale Agreement; or (iii) to a Servicer in and, in each case, if the
Indenture Trustee is provided with the following:
(a) an Issuer Order stating the sale price and directing that
Financed Student Loans be sold, transferred or otherwise disposed of and
delivered to a transferee whose name shall be specified; and
23
(b) a Certificate signed by an Authorized Officer of the
Issuer to the effect that the disposition price is equal to or in excess of the
amount required by the applicable Guarantee Agreement in the case of clause (i),
by the applicable Student Loan Purchase Agreement in the case of clause (ii), or
by the applicable Servicing Agreement in the case of clause (iii).
(c) Subject to the provisions of this Indenture and except for
sales of Financed Student Loans pursuant to this Section 3.14, the Indenture
Trustee shall release property from the lien of this Indenture only upon receipt
of an Issuer Order, 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.
(d) 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 Financed Student Loan to be sold pursuant to this Section 3.14,
and each Noteholder, by the acceptance of a Note, consents to any such release.
The Indenture Trustee, as a third-party beneficiary under the Student Loan
Purchase Agreements entered into by the Depositor, who has assigned its entire
right, title and interest in such Student Loan Purchase Agreements to the Issuer
pursuant to the terms of the Deposit and Sale Agreement, shall have the right to
request the repurchase of loans by the applicable Seller or the Depositor, as
the case may be, together with any indemnity payments due thereunder upon the
conditions and subject to the provisions contained in the Student Loan Purchase
Agreements. The Indenture Trustee shall make such a request to the applicable
Seller under the related Student Loan Purchase Agreement or the Depositor under
the Deposit and Sale Agreement, as the case may be, to repurchase and, as the
case may be, pay any indemnity amounts due with respect to certain specific
loans pursuant to the Student Loan Purchase Agreements or the Deposit and Sale
Agreement, as applicable, if (i) the Indenture Trustee has actual knowledge that
the conditions precedent to such a repurchase or indemnity obligation with
respect to such loans have been satisfied; (ii) it has notified the Issuer in
writing that such conditions have been satisfied; and (iii) the Issuer has not
exercised its right to request the repurchase or indemnity of the applicable
loans by the applicable Seller or the Depositor, as the case may be, within 10
days after receiving written notice from the Indenture Trustee.
SECTION 3.15 GUARANTEES, LOANS, ADVANCES AND OTHER
LIABILITIES. Except as contemplated by this Indenture or 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).
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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 Owner 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 Depositor, the Servicers 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 such persons 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 and the Rating Agencies prompt written notice of each
Event of Default hereunder and each default on the part of the Servicer of its
obligations under a Servicing Agreement or the Administrator of its obligations
under the Administration Agreement. In addition, the Issuer shall deliver to the
Indenture Trustee, 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 Default
under Section 5.01(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.
SECTION 3.20 ADDITIONAL COVENANTS. The Issuer covenants that
it will acquire or cause to be acquired Student Loans as described herein. The
Noteholders shall not in any circumstances be deemed to be the owner or holder
of the Financed Student Loan.
The Issuer, or its designated agent, shall be responsible for each of the
following actions:
(a) The Issuer, or its designated agent, shall cause the
benefits of the Guarantee Agreements to flow to the Indenture Trustee.
(b) The Indenture Trustee shall have no obligation to
administer, service or collect the loans in the Trust Estate or to maintain or
monitor the administration, servicing or collection of such loans.
(c) The Issuer shall comply with all United States statutes,
rules and regulations which apply to the Student Loan Programs, the Program
Manual and the Student Loans.
(d) The Issuer shall cause to be diligently enforced and taken
all reasonable steps, actions and proceedings necessary for the enforcement of
all terms, covenants and conditions of all Student Loans made and agreements in
connection therewith, including the
25
prompt payment of all principal and interest payments and all other amounts due
the Issuer thereunder. The Issuer shall not permit the release of the
obligations of any borrower under any Student Loan and shall at all times, to
the extent permitted by law, cause to be defended, enforced, preserved and
protected the rights and privileges of the Issuer, the Indenture Trustee and of
the Noteholders under or with respect to each Student Loan and agreement in
connection therewith.
(e) The Issuer shall take all appropriate action to ensure
that at the time each Student Loan becomes a part of the Trust Estate it shall
be free and clear from all liens.
(f) The Issuer shall diligently enforce, and take all steps,
actions and proceedings reasonably necessary to protect its rights with respect
to each Student Loan, and to maintain any Guarantee (including the Guarantee
issued by XXXX) on and to enforce all terms, covenants and conditions of Student
Loans, including its rights and remedies under any Student Loan Purchase
Agreement and the XXXX Pledge Fund.
The Trustee shall not be deemed to be the designated agent for the purposes of
this Section unless it has agreed in writing to be such agent.
SECTION 3.21 COVENANT REGARDING FINANCED STUDENT LOANS. The
Issuer hereby covenants that all Student Loans to be acquired hereunder will
meet the following:
(a) Each Student Loan is evidenced by an executed promissory
note, which note is a valid and binding obligation of the Obligor, enforceable
by or on behalf of the holder thereof in accordance with its terms, subject to
bankruptcy, insolvency and other laws relating to or affecting creditors'
rights.
(b) The amount of the unpaid principal balance of each Student
Loan is due and owing, and no counterclaim, offset, defense or right to
rescission exists with respect to any such Student Loan which can be asserted
and maintained or which, with notice, lapse of time, or the occurrence or
failure to occur of any act or event, could be asserted and maintained by the
Obligor against the Issuer as assignee thereof. The Issuer shall take all
reasonable actions to assure that no maker of a Student Loan has or may acquire
a defense to the payment thereof.
(c) No Student Loan has a payment that is more than 90 days
overdue other than such Student Loans that, in the aggregate, do not exceed
1.00% of the then aggregate outstanding principal amount of the Student Loans.
(d) The Issuer has full right, title and interest in each
Student Loan free and clear of all liens, pledges or encumbrances whatsoever.
(e) Each Student Loan was made in compliance with all
applicable state and federal laws, rules and regulations, including, without
limitation, all applicable nondiscrimination, truth-in-lending, consumer credit
and usury laws.
(f) All loan documentation shall be delivered to the Servicer
(as custodian for the Indenture Trustee) prior to payment of the purchase price
of such Student Loan.
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(g) Each Student Loan is accruing interest (whether or not
such interest is being paid currently by the borrower or is being capitalized),
except as otherwise expressly permitted by this Indenture.
(h) Each Student Loan was originated in conformity with the
"loan acceptance criteria" (including, without limitation, any general policies,
eligible borrower criteria, creditworthiness criteria and "good credit"
criteria) and the "loan program terms" (including, without limitation, the loan
amount, the interest rate and the guaranty fee) (or any similar criteria or
terms, however so designated, under the applicable Program Manual) contained in
the Program Manual and otherwise, in substantial conformity with the Program
Manual.
(i) Each Student Loan is guaranteed by a Guarantee Agency.
SECTION 3.22 ADDITIONAL REPRESENTATIONS OF THE ISSUER. The
Issuer hereby makes the following representations and warranties to the
Indenture Trustee, on behalf of the Noteholders:
(a) VALID AND CONTINUING SECURITY INTEREST. This Indenture
creates a valid and continuing security interest (as defined in the applicable
Uniform Commercial Code ("UCC") in effect in the State of Delaware) in the
Financed Student Loans and all other assets constituting part of the Trust
Estate in favor of the Indenture Trustee, which security interest is prior to
all other liens, charges, security interests, mortgages or other encumbrances,
and is enforceable as such as against creditors of and purchasers from Issuer.
(b) ACCOUNTS. The Financed Student Loans constitute "accounts"
or "payment intangibles" within the meaning of the applicable UCC.
(c) GOOD AND MARKETABLE TITLE. The Issuer owns and has good
and marketable title to the Financed Student Loans and all other assets
constituting part of the Trust Estate free and clear of any lien, charge,
security interest, mortgage or other encumbrance, claim or encumbrance of any
Person, other that those granted pursuant to this Indenture.
(d) PERFECTION BY FILING. The Issuer has caused or will have
caused, within ten days of the Closing Date, the filing of all appropriate
financing statements in the proper filing office in the appropriate
jurisdictions under applicable law in order to perfect the security interest in
the Financed Student Loans and all other assets of the Trust Estate granted to
the Trustee hereunder.
(e) PERFECTION BY POSSESSION. The Issuer has given the
Indenture Trustee a copy of a written acknowledgment from the applicable
custodian that the custodian is holding executed copies of the promissory notes
and master promissory notes that constitute or evidence the Financed Student
Loans, and that such custodian is holding such notes solely on behalf and for
the benefit of the Indenture Trustee.
(f) PRIORITY. Other than the security interest granted to the
Indenture Trustee pursuant to this Indenture, the Issuer has not pledged,
assigned, sold, granted a security interest in, or otherwise conveyed any of the
Financed Student Loans or any other portion of the Trust Estate. The Issuer has
not authorized the filing of and is not aware of any financing statements
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against the Issuer that include a description of collateral covering the
Financed Student Loans or any other portion of the Trust Estate other than any
financing statement relating to the security interest granted to the Trustee
hereunder or that has been terminated. The Issuer is not aware of any judgment
or tax lien filings against the Issuer.
(g) VALID BUSINESS REASONS; NO FRAUDULENT TRANSFERS. The
transactions contemplated by this Indenture are in the ordinary course of the
Issuer's business and the Issuer has valid business reasons for granting the
Indenture Trust Estate pursuant to this Indenture. At the time of each such
grant: (i) the Issuer granted the Indenture Trust Estate to the Indenture
Trustee without any intent to hinder, delay, or defraud any current or future
creditor of the Issuer; (ii) the Issuer was not insolvent and did not become
insolvent as a result of any such grant; (iii) the Issuer was not engaged and
was not about to engage in any business or transaction for which any property
remaining with such entity was an unreasonably small capital or for which the
remaining assets of such entity are unreasonably small in relation to the
business of such entity or the transaction; (iv) the Issuer did not intend to
incur, and did not believe or should not have reasonably believed, that it would
incur, debts beyond its ability to pay as they become due; and (v) the
consideration paid received by the Issuer for the grant of the Indenture Trust
Estate was reasonably equivalent to the value of the related grant.
SECTION 3.23 ISSUER SEPARATENESS COVENANTS. So long as any of
the Notes are Outstanding:
(a) The Issuer shall not engage in any business or activity
other than in connection with the activities contemplated hereby and in the
Basic Documents, and in connection with the issuance of Notes.
(b) The funds and other assets of the Issuer shall not be
commingled with those of any other individual, corporation, estate, partnership,
joint venture, association, joint stock company, trust, unincorporated
organization, or government or any agency or political subdivision thereof.
(c) The Issuer shall not be, become or hold itself out as
being liable for the debts of any other party.
(d) The Issuer shall not form, or cause to be formed, any
subsidiaries.
(e) The Issuer shall act solely in its own name and through
its duly authorized officers or agents in the conduct of its business, and shall
conduct its business so as not to mislead others as to the identity of the
entity with which they are concerned.
(f) The Issuer shall maintain its records and books of account
and shall not commingle its records and books of account with the records and
books of account of any other Person. The books of the Issuer maybe kept
(subject to any provision contained in the statutes) inside or outside the State
of Delaware at such place or places as may be designated from time to time by
the board of trustees or in the bylaws of the Issuer.
(g) All actions of the Issuer shall be taken by a duly
authorized officer or agent of the Issuer.
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(h) The Issuer shall not amend, alter, change or repeal any
provision contained in this Section without (i) the prior written consent of the
Indenture Trustee, and (ii) satisfying the Rating Agency Condition.
(i) The Issuer shall not amend its organizational documents or
change its jurisdiction of formation without first satisfying the Rating Agency
Condition.
(j) All audited financial statements of the Issuer that are
consolidated with those of any Affiliate thereof will contain detailed notes
clearly stating that (i) all of the Issuer's assets are owned by the Issuer, and
(ii) the Issuer is a separate entity with creditors who have received ownership
and/or security interests in the Issuer's assets.
(k) The Issuer will strictly observe legal formalities in its
dealings with any of its Affiliates, and funds or other assets of the Issuer
will not be commingled with those of any of its Affiliates. The Issuer shall not
maintain joint bank accounts or other depository accounts to which any of its
Affiliates has independent access. None of the Issuer's funds will at any time
be pooled with the funds of any of its Affiliates.
(l) The Issuer will maintain an arm's length relationship with
each Seller (and any Affiliate thereof), the Depositor (and any Affiliate
thereof), and any of the Issuer's Affiliates. Any Person that renders or
otherwise furnishes services to the Issuer will be compensated by the Issuer at
market rates for such services it renders or otherwise furnishes to the Issuer
except as otherwise provided in this Indenture. The Issuer will not hold itself
out to be responsible for the debts of the Seller, or the Depositor, the parent
or the decisions or actions respecting the daily business and affairs of the
Seller, the Depositor or the parent.
(m) The Issuer shall not sell, transfer, exchange or otherwise
dispose of any portion of the Trust Estate except as expressly permitted by this
Indenture.
(n) The Issuer shall not claim any credit on, or make any
deduction from, the principal amount of any of the Notes by reason of the
payment of any taxes levied or assessed upon any portion of the Trust Estate.
(o) The Issuer shall not permit the validity or effectiveness
of this Indenture or any grant hereunder 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 under this Indenture, except as may be expressly permitted hereby.
SECTION 3.24 REPORTS BY ISSUER. The Issuer will:
(a) File with the Indenture Trustee, within 15 days after the
Issuer is required to file the same with the SEC, 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 SEC may from time to time by rules and
regulations prescribe), if any, which the Issuer may be required to file with
the SEC pursuant to Section 13 or Section 15(d) of the Exchange Act;
(b) File with the Indenture Trustee and the SEC, in accordance
with rules and regulations prescribed from time to time by the SEC, such
additional information, documents
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and reports, if any, 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
(c) Transmit by mail to the Noteholders, within 30 days after
the filing thereof with the Indenture Trustee, in the manner and to the extent
provided in TIA Section 313(c), such summaries of any information, documents and
reports required to be filed by the Issuer, if any, pursuant to Section 3.24(a)
and (b) as may be required by rules and regulations prescribed from time to time
by the SEC.
The Indenture Trustee may conclusively rely and accept such reports from the
Issuer as fulfilling the requirements of this Section 3.24, with no further duty
to examine such reports or to determine whether such reports comply with the
prescribed timing, rules and regulations of the SEC. Delivery of such reports to
the Indenture Trustee is for informational purposes only and the Indenture
Trustee's receipt of such shall not constitute constructive notice of any
information contained therein or determinable from information contained
therein, including the Issuer's compliance with any of its covenants hereunder
(as to which the Indenture Trustee is entitled to rely on an Officers'
Certificate).
SECTION 3.25 RULE 144A INFORMATION. For so long as any of the
Private Notes are outstanding and are "restricted securities" within the meaning
of Rule 144(a)(3) of the Securities Act, (i) the Issuer will provide or cause to
be provided to any holder of such Notes and any prospective purchaser thereof
designated by such a holder, upon the request of such holder or prospective
purchaser, the information required to be provided to such holder or prospective
purchaser by Rule 144A(d)(4) under the Securities Act; and (ii) the Issuer shall
update such information from time to time in order to prevent such information
from becoming false and misleading and will take such other actions as are
necessary to ensure that the safe harbor exemption from the registration
requirements of the Securities Act under Rule 144A is and will be available for
resales of such Private Notes conducted in accordance with Rule 144A.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.01 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 holders of the Notes
to receive payments of principal thereof and interest thereon, (iv) Sections
3.03, 3.04, 3.05, 3.08, 3.10, 3.12 and 3.13, (v) the rights, obligations and
immunities of the Indenture Trustee hereunder (including the rights of the
Indenture Trustee under Section 6.07 and the obligations of the Indenture
Trustee under Section 4.02) and (vi) the rights of holders of the Notes, 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) a period of 367 days has expired after
all Notes theretofore authenticated and delivered (other than
(i) Notes that have been destroyed, lost or
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stolen and that have been replaced or paid as provided in
Section 2.05 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 3.03) have
been delivered to the Indenture Trustee for cancellation;
(B) a period of 367 days has expired after
the later of (i) the date on which no Notes are outstanding or
(ii) the date on which the Issuer has paid or caused to be
paid all other sums otherwise payable hereunder by the Issuer;
and
(C) the Issuer has delivered to the
Indenture Trustee an Officers' Certificate of the Issuer and
an Opinion of Counsel, each meeting the applicable
requirements of Section 11.01 and, subject to Section 11.02,
each stating that all conditions precedent herein provided for
relating to the satisfaction and discharge of this Indenture
have been complied with.
SECTION 4.02 APPLICATION OF TRUST MONEY. All moneys deposited
with the Indenture Trustee pursuant to Section 4.01 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 holders of the particular Notes for the
payment of which such moneys have been deposited with the Indenture Trustee, of
all sums due and to become due thereon for principal of and interest on each
Class of Notes; but such moneys need not be segregated from other funds except
to the extent required herein or required by law.
SECTION 4.03 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 3.03 and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
ARTICLE V
Remedies
SECTION 5.01 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 three (3) Business Days (PROVIDED, HOWEVER, so
long as any of the Senior Notes are outstanding, each holder of any
Class B Note or the Note Owner of any such Class B Note by such
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holder's acceptance of such Class B Note or beneficial interest
therein, as the case may be, shall be deemed to have consented to the
delay in payment of interest on such Class B Note and to have waived
its right to institute suit for enforcement of any such payment); or;
(ii) default in the payment of the principal of any
Note (x) when the same becomes due and payable (but only to the extent
there exists sufficient Available Funds, therefor), or (y) on the Final
Maturity Date with respect thereto; or
(iii) default in the observance or performance of any
covenant or agreement of the Issuer made in this Indenture or any other
Basic Document (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 any other Basic Document or in any
certificate or other writing delivered pursuant hereto or in connection
herewith proving to have been incorrect in any material respect as of
the time when the same shall have been made, and such default 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 Interested Noteholders, representing not less than 25%
of the Outstanding Amount of the applicable Classes of 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, 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 5.02 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 at the direction of the Interested
Noteholders representing not less than a majority of the
32
Outstanding Amount of the applicable Classes of Notes, shall 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 the holders of the Notes), and upon
any such declaration the unpaid principal amount of the Notes, together with
accrued and unpaid interest thereon through the date of acceleration, shall
become immediately due and payable.
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 Interested
Noteholders representing not less than a majority of the Outstanding Amount of
the applicable Classes of 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 have 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.
SECTION 5.03 COLLECTION OF INDEBTEDNESS AND SUITS FOR
ENFORCEMENT BY INDENTURE TRUSTEE. (a) 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 three Business Days, or (ii)
default is made in the payment of the principal on the related Final Maturity
Date of a Class of Notes when the same becomes due and payable in accordance
with Section 2.07(b), the Issuer will, upon demand of the Indenture Trustee, pay
to the Indenture Trustee, for the benefit of the holders of the Notes, 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 2.07 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.
(b) 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, or shall at the written direction of the Interested
Noteholders, representing not less than a majority of the Outstanding Amount of
the applicable Classes of Notes, institute a Proceeding for the collection of
the sums so due and unpaid, and prosecute such Proceeding to judgment or final
decree, and
33
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.
(c) If an Event of Default occurs and is continuing, the
Indenture Trustee may, or shall at the written direction of the Interested
Noteholders, representing not less than a majority of the Outstanding Amount of
the applicable Classes of Notes, as more particularly provided in Section 5.04,
proceed to protect and enforce its rights, the rights of the holders of the
Notes, as applicable, 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.
(d) 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, may, or shall at the written direction of the Interested
Noteholders representing not less than a majority of the Outstanding Amount of
the applicable Classes of Notes, 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 of and interest on each Class of Notes 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 predecessor Indenture
Trustee, except as a result of negligence or bad faith) and the holders
of the Notes allowed in such Proceedings;
(ii) unless prohibited by applicable law and
regulations, to vote on behalf of the holders of the Notes 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 holders of the
Notes and of the Indenture Trustee on their behalf;
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(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 or the holders of the Notes allowed in any
judicial proceedings relative to the Issuer, its creditors and its
property; and
(v) to take any other action with respect to such
claims including participating as a member of any official committee of
creditor's appointed in the matters as it deems necessary or advisable;
and any trustee, receiver, liquidator, custodian or other similar
official in any such Proceeding is hereby authorized by each of such holders of
the Notes 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
holders of the Notes 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.
(e) 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 holder of the Notes any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any holder of the
Notes thereof or to authorize the Indenture Trustee to vote in respect of the
claim of any holder of the Notes in any such proceeding except, as aforesaid, to
vote for the election of a trustee in bankruptcy or similar Person.
(f) 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 holders of the Notes.
(g) 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 holders of the Notes and it shall not
be necessary to make any holder of the Notes a party to any such Proceedings.
SECTION 5.04 REMEDIES; PRIORITIES. (a) If an Event of Default
shall have occurred and be continuing, the Indenture Trustee may, or shall at
the written direction of the Interested Noteholders representing not less than a
majority of the Outstanding Amount of the applicable Classes of Notes (or such
different percentage as set forth below), do one or more of the following
(subject to Section 5.05):
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(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;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture with respect to the
Indenture Trust Estate securing the Notes;
(iii) exercise any remedies of a secured party under
the UCC and take any other appropriate action to protect and enforce
the rights and remedies of the Indenture Trustee and the holders of the
Notes; and
(iv) sell the Indenture Trust Estate securing the
Notes 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;
PROVIDED, HOWEVER, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate securing the Notes following an Event of
Default, other than an Event of Default described in Section 5.01(i) or (ii),
unless (x) 100% of the Noteholders consent to such sale, (y) the proceeds of
such sale are sufficient to pay in full the principal of and the accrued
interest on the Notes or (z) the Indenture Trustee determines that the
collections on the Student Loans would not be sufficient on an ongoing basis to
make all payments on the Notes as such payments would have become due if such
obligations had not been declared due and payable, and the Indenture Trustee
obtains the consent of the holders of Notes, representing not less than a 66.67%
of the Outstanding Amount of the Notes.
(b) If the Indenture Trustee collects any money or property
under this Article V following the occurrence and during the continuation of an
Event of Default with respect to Sections 5.01(i) or 5.01(ii) above or following
the acceleration of the Notes pursuant to Section 5.02, it shall pay out the
money or property in the following order:
First: pro rata based upon amounts owed to the Owner Trustee
for amounts due under Article X of the Trust Agreement, to the
Indenture Trustee for amounts due under Section 6.07 and to the Grantor
Trustee for amounts due under the Grantor Trust Agreement, not to
exceed $150,000 per annum in the aggregate, (ii) to the Servicers, the
Administrator and any Paying Agents, the unpaid fees owed by the Issuer
to such parties, not to exceed $100,000 per annum in the aggregate, and
(iii) to the Auction Agent and the Broker-Dealers, the unpaid fees owed
by the Issuer to such parties;
Second: to the holders of the Class A Notes for amounts due
and unpaid on the Class A Notes for interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A Notes for interest;
Third: to the holders of the Class A Notes, other than the
Class A-IO Notes, for amounts due and unpaid on the Class A Notes for
principal, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class A Notes for
principal, until the Outstanding Amount of the Class A Notes is zero.
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Fourth: to the holders of the Class B Notes for amounts due
and unpaid on the Class B Notes for interest (other than Carry-Over
Amounts) ratably, without preference or priority of any kind, according
to the amounts due and payable on the Class B Notes for interest;
Fifth: to the holders of the Class B Notes for amounts due and
unpaid on the Class B Notes for principal, ratably, without preference
or priority of any kind, according to the amounts due and payable on
the Class B Notes for principal, until the Outstanding Amount of the
Class B Notes is zero;
Sixth: to the holders of the Class B Notes for amounts due and
unpaid for Carry-Over Amounts, ratably without preference or priority
of any kind, according to the amounts due and payable on the Class B
Notes for Carry-Over Amounts;
Seventh: pro rata based upon amounts owed, to the Owner
Trustee, the Indenture Trustee and the Grantor Trustee, for all amounts
due and owing to such parties under the Basic Documents to the extent
not paid pursuant to priority FIRST above, to FMC, for any unreimbursed
Advances made pursuant to Section 8.11, and to the Servicers, the
Administrator any Paying Agents, the Auction Agent, the Broker-Dealers
and the Guarantee Agency, for all amounts due and owing to such parties
pursuant to the Basic Documents, and
Eighth: to the Owner Trustee (on behalf of the Issuer), for
distribution to the Certificateholders in accordance with the terms of
the Trust Agreement.
The Indenture Trustee may fix a record date and payment date for any payment to
the holders of the Notes pursuant to this Section. At least 15 days before such
record date, the Issuer shall mail to each holder of the Notes and the Indenture
Trustee a notice that states the record date, the payment date and the amount to
be paid.
(c) If the Indenture Trustee collects any money or property
under this Article V following the occurrence and during the continuation of an
Event of Default other than with respect to Sections 5.01(i) or 5.01(ii) above
or following the acceleration of the Notes pursuant to Section 5.02, it shall
pay out the money or property in the following order:
First: pro rata based upon amounts owed (i) to the Owner
Trustee for amounts due under Article X of the Trust Agreement, to the
Indenture Trustee for amounts due under Section 6.07 and to the Grantor
Trustee for amounts due under the Grantor Trust Agreement, not to
exceed $150,000 per annum in the aggregate, (ii) to the Servicers, the
Administrator and any Paying Agents, the unpaid fees owed by the Issuer
to such parties, not to exceed $100,000 per annum in the aggregate, and
(iii) to the Auction Agent and the Broker-Dealers, the unpaid fees owed
by the Issuer to such parties;
Second: to the holders of the Class A Notes for amounts due
and unpaid on the Class A Notes for interest, ratably, without
preference or priority of any kind, according to the amounts due and
payable on the Class A Notes for interest;
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Third: to the holders of the Class B Notes for amounts due and
unpaid on the Class B Notes for interest (other than Carry-Over
Amounts) ratably, without preference or priority of any kind, according
to the amounts due and payable on the Class B Notes for interest;
Fourth: to the holders of the Class A Notes, other than the
Class A-IO Notes, for amounts due and unpaid on the Class A Notes for
principal, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Class A Notes for
principal, until the Outstanding Amount of the Class A Notes is zero.
Fifth: to the holders of the Class B Notes for amounts due and
unpaid on the Class B Notes for principal, ratably, without preference
or priority of any kind, according to the amounts due and payable on
the Class B Notes for principal, until the Outstanding Amount of the
Class B Notes is zero;
Sixth: to the holders of the Class B Notes for amounts due and
unpaid for Carry-Over Amounts, ratably without preference or priority
of any kind, according to the amounts due and payable on the Class B
Notes for Carry-Over Amounts;
Seventh: pro rata based upon amounts owed, to the Owner
Trustee, the Indenture Trustee and the Grantor Trustee, for all amounts
due and owning to such parties under the Basic Documents to the extent
not paid pursuant to priority FIRST above, to FMC, for any unreimbursed
Advances made pursuant to Section 8.11, and to the Servicers, the
Administrator, any Paying Agents, the Auction Agent, the Broker-Dealers
and the Guarantee Agency, for all amounts due and owing to such parties
pursuant to the Basic Documents, and
Eighth: to the Owner Trustee (on behalf of the Issuer), for
distribution to the Certificateholders in accordance with the terms of
the Trust Agreement.
SECTION 5.05 OPTIONAL PRESERVATION OF THE FINANCED STUDENT
LOANS. If the Notes have been declared to be due and payable under Section 5.02
following an Event of Default and such declaration and its consequences have not
been rescinded and annulled, the Indenture Trustee may, or shall at the written
direction of the Interested Noteholders, representing not less than a majority
of the Outstanding Amount of the applicable Classes of Notes, elect to maintain
possession of the related Indenture Trust Estate. It is the desire of the
parties hereto and the holders of the Notes that there be at all times
sufficient funds for the payment of principal of and interest on each Class of
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 5.06 LIMITATION OF SUITS. No holder of the Notes shall
have any right to institute any Proceeding, judicial or otherwise, with respect
to this Indenture, or for the
38
appointment of a receiver or trustee, or for any other remedy hereunder, unless
the following conditions listed below are satisfied:
(i) such holder of the Notes has previously given
written notice to the Indenture Trustee of a continuing Event of
Default;
(ii) the holders of not less than 25% of the
Outstanding Amount of the Notes, in the aggregate, 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 holders of the Notes 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 holders of a majority of the Outstanding Amount of the
Notes in the aggregate;
it being understood and intended that no one or more holders of the
Notes 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 holders of the Notes or to obtain or to seek to obtain priority or
preference over any other holders of the Notes or to enforce any right under
this Indenture, except in the manner herein provided.
If 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 5.07 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE
PRINCIPAL AND INTEREST. Notwithstanding any other provisions in this Indenture,
any holder of any Class of Notes shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest, on such
Note, on or after the respective due dates thereof expressed in such Note or in
this Indenture and to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such holder of any
such Class of Notes.
SECTION 5.08 RESTORATION OF RIGHTS AND REMEDIES. If the
Indenture Trustee or any holder of Notes 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 holder of Notes, then and in every such case the
Issuer, the Indenture Trustee and the holders of the Notes 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 holders of the Notes shall continue as though no such
Proceeding had been instituted.
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SECTION 5.09 RIGHTS AND REMEDIES CUMULATIVE. No right or
remedy herein conferred upon or reserved to the Indenture Trustee or to the
holders of the Notes 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 holder of Notes 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 or to the
holders of the Notes may be exercised from time to time, and as often as may be
deemed expedient, by the Indenture Trustee or by the holders of the Notes.
SECTION 5.11 CONTROL BY NOTEHOLDERS. With respect to the
Notes, the Interested Noteholders, representing not less than a majority of the
Outstanding Amount of the applicable Classes of Notes (or, in each case, if only
one Class is affected thereby, a majority of the Outstanding Amount of such
Class) 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 5.04,
any direction to the Indenture Trustee to sell or liquidate the
Indenture Trust Estate shall be by the holders of not less than 100% of
the Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.05
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 the holders 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 6.01, 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 holders of the Notes not
consenting to such action.
SECTION 5.12 WAIVER OF PAST DEFAULTS. Prior to the declaration
of the acceleration of the Notes as provided in Section 5.02, the Interested
Noteholders representing not less than a majority of the Outstanding Amount of
the applicable Classes of Notes, may waive any past Default and its consequences
except a Default (a) in payment when due of principal of or interest on any Note
or (b) in respect of a covenant or provision hereof which cannot be modified or
amended without the consent of each holder of the Notes. In the case of any such
40
waiver, the Issuer, the Indenture Trustee and the holders of the Notes 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 holder of the Notes 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 holder of the Notes or
group of holders of the Notes, in each case holding in the aggregate more than
10% of the Outstanding Amount of the Notes or (c) any suit instituted by any
holder of the Notes 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.
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 holders of the Notes 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 5.04(b) or (c), as the case may be.
SECTION 5.16 PERFORMANCE AND ENFORCEMENT OF CERTAIN
OBLIGATIONS. (a) Promptly following a request from the Indenture Trustee, 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, the Sellers, the Administrator and the Servicers, as
applicable, of each of their obligations to the Issuer under or in connection
with the Basic Documents in accordance with the terms thereof, and to exercise
any and all rights,
41
remedies, powers and privileges lawfully available to the Issuer under or in
connection with the Basic Documents, including the transmission of notices of
default and the institution of legal or administrative actions or proceedings to
compel or secure performance by the Depositor, the Sellers, the Administrator or
the Servicers of each of their obligations under the Basic Documents.
(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee shall at the direction (which direction shall be in writing or
by telephone (confirmed in writing promptly thereafter)) of the Interested
Noteholders, representing not less than 66.67% of the Outstanding Amount of the
applicable Classes of Notes, exercise all rights, remedies, powers, privileges
and claims of the Issuer against the Depositor, the Sellers, the Administrator,
the Servicers or the Guarantee Agency under or in connection with the Basic
Documents, including the right or power to take any action to compel or secure
performance or observance by the Depositor, the Sellers, the Administrator and
the Servicers of each of their obligations to the Issuer thereunder and to give
any consent, request, notice, direction, approval, extension or waiver under the
Basic Documents and any right of the Issuer to take such action shall be
suspended.
SECTION 5.17 NOTICE OF DEFAULTS. Within 90 days after the
occurrence of any Default hereunder with respect to the Notes, the Indenture
Trustee shall transmit in the manner and to the extent provided in TIA Section
313(c), notice of such Default hereunder to which a Responsible Officer of the
Indenture Trustee has actual knowledge or is in receipt of a written notice
thereof in accordance with the terms of this Indenture, unless such Default
shall have been cured or waived; PROVIDED, HOWEVER, that, except in the case of
a Default in the payment of the principal of or interest with respect to any
Note, the Indenture Trustee shall be protected in withholding such notice if and
so long as a Responsible Officer of the Indenture Trustee in good faith
determines that the withholding of such notice is in the interest of the
Noteholders.
ARTICLE VI
The Indenture Trustee
SECTION 6.01 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 the other Basic Documents to which the Indenture Trustee
is a party, 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 therein, upon
certificates or opinions furnished to a Responsible Officer of the
42
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) Every provision of this Indenture that in any way relates
to the Indenture Trustee is subject to paragraphs (a), (b), (c) and (g) of this
Section 6.01.
(e) 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.
(f) 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.
(g) 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.
(h) Except as expressly provided in the Basic Documents, the
Indenture Trustee shall have no obligation to administer, service or collect the
Financed Student Loans or to maintain, monitor or otherwise supervise the
administration, servicing or collection of the Financed Student Loans.
(i) 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.
(j) 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 6.01.
SECTION 6.02 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
43
proper Person. The Indenture Trustee need not investigate any fact or matter
stated in such document.
(b) Before the Indenture Trustee acts or refrains from acting,
it may require an Officers' Certificate of the Issuer 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.
(f) In the event that the Person acting as Indenture Trustee
is also acting as securities intermediary all the rights, powers, immunities and
indemnities afforded to the Indenture Trustee under the Basic Documents shall
also be afforded to the securities intermediary.
(g) Absent willful misconduct or fraud, the Indenture Trustee
shall not be liable for any punitive damages, regardless of the form of action
and whether or not any such damages were foreseeable or contemplated.
(h) The Indenture Trustee shall not be deemed to have notice
of any Default or Event of Default unless a Responsible Officer of the Indenture
Trustee has actual knowledge thereof or unless written notice of any event which
is in fact such Default or Event of Default is received by the Indenture Trustee
at the Corporate Trust Office, and such notice references the Notes under this
Indenture.
(i) Any permissive right or authority granted to the Indenture
Trustee shall not be construed as a mandatory duty.
SECTION 6.03 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 Section 6.11.
44
SECTION 6.04 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 6.05 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 received by a Responsible Officer of the Indenture Trustee, the
Indenture Trustee shall mail to each holder of the Notes notice of the Default
within 90 days after it occurs. Except in the case of a Default in payment of
principal of or interest on the Notes, the Indenture Trustee may withhold the
notice to the holders of the Notes if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interests of holders of the Notes.
SECTION 6.06 REPORTS BY INDENTURE TRUSTEE TO NOTEHOLDERS. The
Indenture Trustee shall deliver to each holder of the Notes (and to each Person
who was a holder of the Notes 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.
SECTION 6.07 COMPENSATION AND INDEMNITY. The Issuer shall pay
to the Indenture Trustee from time to time reasonable compensation for all
services rendered under this Indenture, and also all reasonable expenses,
charges, counsel fees and other disbursements, including those of their
attorneys, agents and employees, incurred in and about the performance of their
powers and duties under this Indenture. The Issuer further agrees to indemnify
and save the Indenture Trustee harmless against any liabilities which it may
incur in the exercise and performance of its powers and duties hereunder, and
which are not due to its negligence or willful misconduct, to the extent solely
payable from the Indenture Trust Estate. To secure the Indenture Trustee's right
to receive amounts pursuant to this Section 6.07, the Indenture Trustee shall
have a lien against the Indenture Trust Estate that is subordinate to the rights
of the Noteholders. Without prejudice to its rights hereunder, when the
Indenture Trustee incurs expenses or renders services after a Default specified
in Sections 5.01(iv) or (v) occurs, such expenses and the compensation for such
services (including the fees and expenses of its agent and counsel) shall
constitute expenses of administration under the applicable bankruptcy law. The
provisions of this Section 6.07 shall survive the satisfaction and discharge of
this Indenture and the resignation or removal of the Indenture Trustee.
SECTION 6.08 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 6.08. The Indenture Trustee
may resign at any time by so notifying the Issuer. The Administrator 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;
45
(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 Administrator
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 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 the holders of the Notes and each
Rating Agency. The retiring Indenture Trustee shall promptly transfer all
property held by it as Indenture Trustee to the successor Indenture Trustee upon
payment of all monies due and owing to the retiring 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 holders of a majority in Outstanding Amount of the
Notes may petition any court of competent jurisdiction for the appointment of a
successor Indenture Trustee.
If the Indenture Trustee fails to comply with Section 6.11, any holder of the
Notes 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 6.07
shall continue for the benefit of the retiring Indenture Trustee.
SECTION 6.09 SUCCESSOR INDENTURE TRUSTEE BY MERGER. If the
Indenture Trustee consolidates with, merges or converts into, or transfers all
or substantially all 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.
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
46
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 holders
of the Notes, 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 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 holders of the Notes of the appointment of any co-trustee or separate
trustee shall be required under Section 6.08 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 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
47
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 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. There shall at all
times be an Indenture Trustee hereunder which shall be eligible to act as
Indenture Trustee under TIA Section 310(a)(1) and shall have a combined capital
and surplus of at least $50,000,000 (and, with respect to any successor
Indenture Trustee, having a rating of at least "Baa3" from Xxxxx'x unless the
Rating Agency Condition is satisfied). If such corporation publishes reports of
condition at least annually, pursuant to law or the requirements of federal,
state, territorial or District of Columbia supervising or examining authority,
then for the purposes of this Section 6.11, the combined capital and surplus of
such corporation shall be deemed to be its combined capital and surplus as set
forth in its most recent report of condition so published. If at any time the
Indenture Trustee shall cease to be eligible in accordance with the provisions
of this Section 6.11, it shall resign immediately in the manner and with the
effect specified in this Article VI. Neither the Issuer nor any Person directly
or indirectly controlling or controlled by, or under common control with, the
Issuer shall serve as Indenture Trustee.
SECTION 6.12 BACK-UP CERTIFICATION. The Indenture Trustee
shall provide the Depositor with a certificate substantially in the form
attached hereto as Exhibit I at the request of the Administrator; provided that
the Indenture Trustee shall have no responsibility to file such certificate with
the Securities and Exchange Commission.
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.01 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 holders of the Notes as of such Record Date, (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.
SECTION 7.02 PRESERVATION OF INFORMATION; COMMUNICATIONS TO
NOTEHOLDERS. (a) The Indenture Trustee shall preserve, in as current a form as
is reasonably practicable, the names and addresses of the holders of the Notes
contained in the most recent list furnished to the Indenture Trustee as provided
in Section 7.01 and the names and addresses of the holders of the
48
Notes 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 7.01 upon receipt of a new list so furnished.
(b) Upon receipt by the Indenture Trustee of any request by a
holder of the Notes to receive a copy of the current list of holders of the
Notes, 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
holders of the Notes produced in response thereto.
(c) The Indenture Trustee shall furnish to the holders of the
Notes 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.
SECTION 7.03 REPORTS BY ISSUER. (a) The Issuer shall cause the
Administrator to furnish the Issuer, the Indenture Trustee and the Grantor
Trustee the reports required by the Administration Agreement and by Section 3.24
of this Indenture.
(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 8.01 COLLECTION OF MONEY. (a) 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 the holders of the Notes 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.
(b) The Indenture Trustee shall deposit into the Collection
Account all payments it receives from the Servicers by or on behalf of the
Obligors with respect to the Student Loans, and all related Liquidation Proceeds
and Recoveries, as collected during the Collection Period. For purposes of this
Article VIII, the phrase "payments by or on behalf of Obligors" shall mean
payments made with respect to the Student Loans, as applicable, by or on behalf
of borrowers thereof and the Guarantee Agency.
(c) The Indenture Trustee shall deposit into the Collection
Account the aggregate Purchase Amount it receives with respect to Purchased
Student Loans and all other amounts received from the Sellers or the Servicers
with respect to the Student Loans. The
49
Indenture Trustee also shall deposit into the Collection Account all amounts
transferred from the Pre-Funding Account pursuant to Section 8.10.
SECTION 8.02 TRUST ACCOUNTS. (a)(i) The Issuer, for the
benefit of the Noteholders and itself, shall establish and maintain in the name
of the Indenture Trustee an Eligible Deposit Account (the "Collection Account"),
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Noteholders and the Issuer. The Collection Account
will initially be established as a segregated account at U.S. Bank National
Association in the name of the Indenture Trustee. The Issuer will make an
initial deposit on the Closing Date into the Collection Account of cash equal to
$605,130,319, which amount will be disbursed on the Closing Date by the
Indenture Trustee, pursuant to written instructions of the Administrator, to
acquire the Initial Financed Student Loans.
(ii) The Issuer, for the benefit of the Noteholders and
itself, shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Reserve Account"), bearing a
designation clearly indicating that the funds deposited therein are
held for the benefit of the Noteholders and the Issuer. The Reserve
Account initially will be established as a segregated account at U.S.
Bank National Association in the name of the Indenture Trustee. The
Issuer will make an initial deposit on the Closing Date into the
Reserve Account of cash or certain Eligible Investments equal to the
Reserve Account Initial Deposit.
(iii) The Issuer, for the benefit of the Noteholders and
itself, shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Pre-Funding Account"),
bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Noteholders and the Issuer. The
Pre-Funding Account initially will be established as a segregated
account at U.S. Bank National Association in the name of the Indenture
Trustee. The Issuer will make an initial deposit on the Closing Date
into the Pre-Funding Account of cash or certain Eligible Investments
equal to $46,168,158.02 (the "Pre-Funded Amount"), to be used for the
purchase of Subsequent Student Loans and as provided by Section 8.10
hereof.
(iv) The Issuer, for the benefit of the Noteholders and
itself, shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Future Distribution
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Noteholders and the
Issuer. The Future Distribution Account initially will be established
as a segregated account at U.S. Bank National Association in the name
of the Indenture Trustee.
(b) Funds on deposit in the Collection Account, the Reserve
Account, the Pre-Funding Account and the Future Distribution Account
(collectively, the "Trust Accounts") shall be invested by the Indenture Trustee
(or any custodian or designated agent with respect to any amounts on deposit in
such accounts) in Eligible Investments pursuant to written instructions by the
Issuer; PROVIDED, HOWEVER, it is understood and agreed that the Indenture
Trustee shall not be liable for any loss arising from such investment in
Eligible Investments. All such Eligible Investments shall be held by (or by any
custodian on behalf of) the Indenture Trustee for the benefit of the Noteholders
and the Issuer; provided that on the Business Day preceding each
50
Distribution Date on which funds in the applicable Trust Account will be needed,
all interest and other investment income (net of losses and investment expenses)
on funds on deposit therein shall be deposited into the Collection Account and
shall constitute a portion of the Available Funds for such Distribution Date.
Other than as described in the following proviso or as otherwise permitted by
the Rating Agencies, funds on deposit in the Trust Accounts shall be invested in
Eligible Investments that will mature so that such funds will be available at
the close of business on the Business Day preceding the following Distribution
Date for which such funds are needed; PROVIDED, HOWEVER, that funds on deposit
in Trust Accounts may be invested in Eligible Investments of the Indenture
Trustee which may mature so that such funds will be available on such
Distribution Date. Funds deposited in a Trust Account on a Business Day which
immediately precedes a Distribution Date upon the maturity of any Eligible
Investments are not required to be invested overnight.
(c) The Indenture Trustee, on behalf of the Noteholders, shall
possess all right, title and interest in all funds on deposit from time to time
in the Trust Accounts and in all proceeds thereof (including all income thereon)
and all such funds, investments, proceeds and income shall be part of the
Indenture Trust Estate. Subject to the Issuer's power to instruct the Indenture
Trustee pursuant to paragraph (b) above, the Trust Accounts shall be under the
sole dominion and control of the Indenture Trustee for the benefit of the
Noteholders. If, at any time, any of the Trust Accounts ceases to be an Eligible
Deposit Account, the Indenture Trustee (or the Administrator on its behalf)
agrees, by its acceptance hereto, that it shall within 5 Business Days (or such
longer period, not to exceed 30 calendar days, as to which each Rating Agency
may consent) establish a new Trust Account as an Eligible Deposit Account and
shall transfer any cash and/or any investments to such new Trust Account. In
connection with the foregoing, the Issuer agrees that, in the event that any of
the Trust Accounts are not accounts with the Indenture Trustee, the Issuer shall
notify the Indenture Trustee, in writing, promptly upon any of such Trust
Accounts ceasing to be an Eligible Deposit Account.
(A) With respect to the Trust Account
Property, the Indenture Trustee agrees, by its acceptance
hereof, that:
(B) any Trust Account Property that is held
in deposit accounts shall be held solely in Eligible Deposit
Accounts; and, subject to Section 8.02(b), each such Eligible
Deposit Account shall be subject to the exclusive custody and
control of the Indenture Trustee, and the Indenture Trustee
shall have sole signature authority with respect thereto;
(C) any Trust Account Property shall be
Delivered to the Indenture Trustee in accordance with the
definition of "Delivery" and shall be held, pending maturity
or disposition, solely by the Indenture Trustee or such other
Person acting solely for the Indenture Trustee as required for
Delivery;
(D) In the event that the Indenture Trustee,
in its capacity as securities intermediary has or subsequently
obtains by agreement, operation of law or otherwise a security
interest in the Trust Accounts or any security entitlement
credited thereto, the Indenture Trustee, in its capacity as
securities intermediary hereby agrees that such security
interest shall be subordinate to the
51
security interest of the Indenture Trustee for the benefit of
the Noteholders. The financial assets and other items
deposited to the Trust Accounts will not be subject to
deduction, set-off, banker's lien, or any other right in favor
of any person other than the Indenture Trustee (except that
the Indenture Trustee, in its capacity as securities
intermediary may set off (i) the face amount of any checks
which have been credited to the Trust Accounts but are
subsequently returned unpaid because of uncollected or
insufficient funds, and (ii) all amounts due to it in respect
of its customary fees and expenses for the routine maintenance
and operation of the Trust Accounts;
(E) The Issuer shall instruct the Indenture
Trustee to make withdrawals and payments from the Trust
Accounts for the purpose of permitting the Indenture Trustee
to carry out its duties under this Indenture;
(F) Each Trust Account provided for herein
to be established and maintained by the Indenture Trustee
shall be so established and maintained by the Indenture
Trustee, as securities intermediary (in such capacity, the
"Securities Intermediary"). Each item of "investment property"
within the meaning of Section 9-102(a)(49) of the New York
Uniform Commercial Code (which shall not be deemed to include
the Financed Student Loans or the related notes evidencing the
Financed Student Loans) or "money" within the meaning of
Section 1-201(24) of the New York Uniform Commercial Code,
that is (whether investment property, security, instrument or
cash) credited to such a Trust Account shall be treated as a
"financial asset" within the meaning of Section 8-102(a)(9) of
the New York Uniform Commercial Code. The State of New York
shall be deemed to be the Securities Intermediary's location
for purposes of the New York Uniform Commercial Code, and each
such Trust Account (as well as the securities entitlements
related thereto) shall be governed by the laws of the State of
New York; and
(G) Following the filing of any UCC
financing statement with respect to this Indenture the
Indenture Trustee hereby agrees to notify the Issuer six
months prior to the expiration of such filing of the need to
file continuation statements, and to the extent permitted by
law, the Issuer shall execute and file such continuation
statements, and provide a copy thereof to the Indenture
Trustee along with an Opinion of Counsel to the effect that
all action has been taken as is necessary to maintain the lien
and security interest created by this Indenture.
(d) On or prior to the 20th calendar day of each month other
than the month in which a Quarterly Distribution Date occurs, or if such day is
not a Business Day, the immediately following Business Day, the Administrator
shall instruct the Indenture Trustee in writing (based on the information
contained in the Administrator's Officer's Certificate and each related
Servicer's Report delivered pursuant to the Administration Agreement) to
transfer funds on deposit in the Collection Account to the Future Distribution
Account, on or before the Monthly Allocation Date of the same month, from and to
the extent of the Available Funds on deposit in the Collection Account, in the
following order of priority, and the Indenture Trustee shall comply with such
instructions:
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(i) First, pro rata based on the amounts owed to each
such party, in the amount of fees and expenses expected to accrue and
be paid to the Indenture Trustee, the Owner Trustee, the Grantor
Trustee, the Servicers and the Administrator from the calendar day
after the current month's Monthly Allocation Date (plus, for the
initial Monthly Allocation Date, the fees and expenses accrued from the
Closing Date through and including such initial Monthly Allocation
Date) through the following month's Monthly Allocation Date, or if
there is not a Monthly Allocation Date in the next calendar month, the
Quarterly Distribution Date that occurs in the following month, plus
previously accrued and unpaid amounts not previously deposited in the
Future Distribution Account;
(ii) Second, pro rata based on the amounts owed to
each such party, in the amount of fees and expenses expected to accrue
and be paid to the Auction Agent and the Broker-Dealers from the
calendar day after the current month's Monthly Allocation date (plus,
for the initial Monthly Allocation Date, the fees and expenses accrued
from the Closing Date through and including such initial Monthly
Allocation Date) through the following month's Monthly Allocation Date,
or if there is not a Monthly Allocation Date in the next calendar
month, the Quarterly Distribution Date that occurs in the following
month, plus previously accrued and unpaid amounts not previously
deposited in the Future Distribution Account;
(iii) Third, pro rata based on the amounts owed to
each such party, for each Class of Class A Notes, other than the Class
A-IO Notes, an amount equal to interest expected to accrue on such
Class of Notes at the then applicable Note Interest Rate, and for the
Class A-IO-1, an amount equal to interest at 7.87% per annum, and for
the Class A-IO-2 Notes, an amount equal to interest at 0.12% per annum,
from the calendar day after the current month's Monthly Allocation Date
(plus, for the initial Monthly Allocation Date, the interest accrued
from the Closing Date through and including such initial Monthly
Allocation Date) through the following month's Monthly Allocation Date,
or if there is not a Monthly Allocation Date in the next calendar
month, the Quarterly Distribution Date that occurs in the following
month, plus previously accrued and unpaid amounts not deposited in the
Future Distribution Account; and
(iv) Fourth, pro rata based on the amounts owed to
each such party, for each Class of Class B Notes, an amount equal to
interest expected to accrue on the Class B Notes at the then applicable
Auction Rates from the calendar day after the current month's Monthly
Allocation Date (plus, for the initial Monthly Allocation Date, the
interest accrued from the Closing Date through and including such
initial Monthly Allocation Date) through the following month's Monthly
Allocation Date, or if there is not a Monthly Allocation Date in the
next calendar month, the Quarterly Distribution Date that occurs in the
following month, plus previously accrued and unpaid amounts not
previously deposited in the Future Distribution Account.
(e) On each Auction Rate Note Interest Payment Date for a
Class of Auction Rate Notes that is not a Quarterly Distribution Date, the
Indenture Trustee will make the following distributions based upon written
instructions received from the Administrator:
53
(i) First, from amounts on deposit in the Future
Distribution Account allocated to the Auction Agent and the
Broker-Dealers, and then from amounts on deposit in the Collection
Account and the Reserve Account, pro rata based upon amounts owed to
each such party, to the Auction Agent and the Broker-Dealers, the
Auction Agent Fees and the Broker-Dealer Fees;
(ii) Second, from amounts on deposit in the Future
Distribution Account to pay interest on that Class of Auction Rate
Notes, and then from amounts on deposit in the Collection Account and
the Reserve Account, to that Class of Auction Rate Notes, an amount
equal to the Noteholders' Interest Distribution Amount for that Class
of Auction Rate Notes;
(iii) Third, from amounts on deposit in the Future
Distribution Account to pay principal on that Class of Auction Rate
Notes, if any, to that Class of Action Rate Notes; and
(iv) Fourth, from amounts on deposit in the Future
Distribution Account to pay Carry-over Amounts on that Class of Auction
Rate Notes, if any, to that Class of Auction Rate Notes.
(f) On each Monthly Servicing Payment Date, based upon written
instructions received from the Administrator, the Indenture Trustee shall pay to
the Servicers an amount equal to the Servicing Fees then payable to the
Servicers from amounts on deposit in the Future Distribution Account that were
allocated for such Servicing Fees, or to the extent necessary, from the
Collection Account and the Reserve Account.
(g) On each Quarterly Distribution Date, the Administrator
shall instruct the Indenture Trustee in writing (based on the information
contained in the Administrator's Officer's Certificate and each related
Servicer's Report delivered pursuant to the Administration Agreement) to make
the following deposits and distributions to the Persons or to the account
specified below by 11:00 a.m. (New York time), to the extent of the amount of
Available Funds in the Collection Account, in the following order of priority
(except as otherwise provided in Sections 5.04(b)) and the Indenture Trustee
shall comply with such instruction; PROVIDED, HOWEVER, only if an Auction Rate
Note Interest Payment Date is also a Quarterly Distribution Date will a Class of
Auction Rate Notes be paid interest or principal on a Quarterly Distribution
Date (otherwise, the amount allocated to each such Class of Auction Rate Notes
will be deposited into the Future Distribution Account):
(1) First, pro rata: (i) Indenture Trustee fees and expenses,
Owner Trustee fees and expenses and Grantor Trustee fees and expenses,
in an aggregate amount not to exceed $150,000 per annum; (ii) Servicing
Fees with respect to the Financed Student Loans due on such Quarterly
Distribution Date and all prior unpaid Servicing Fees allocated to the
Financed Student Loans up to the amount specified in the Servicing
Agreements, Administration Fees with respect to the Financed Student
Loans up to the amount specified in the Administration Agreement and
any Paying Agent fees, the aggregate amount of fees paid pursuant to
this clause (ii) shall not exceed $100,000 per annum, and (iii) to the
extent the Quarterly Distribution Date is also an Auction Rate
54
Note Interest Payment Date, Broker-Dealer Fees and expenses up to the
amount specified in the Broker-Dealer Agreements and Auction Agent Fees
and expenses up to the amount specified in the Auction Agency
Agreement;
(2) Second, to the Future Distribution Account, an amount
necessary to provide for one month's expected payments of fees and
expenses for each of the items in clause (1);
(3) Third, to XXXX, the additional guaranty fees pursuant to
the XXXX Guaranty Agreements, which will be deposited into the XXXX
Pledge Fund;
(4) Fourth, to the holders of each Class of Class A Notes, the
Interest Distribution Amount for such Class A Notes on a pro rata
basis;
(5) Fifth, if the Quarterly Distribution Date is the Final
Maturity Date for a Class of Class A Notes, to the holders of that
Class of Class A Notes, the amount required to reduce the Outstanding
Principal Balance of that Class to zero;
(6) Sixth, if the Quarterly Distribution Date is also an
Auction Rate Note Interest Payment Date for one or more Classes of
Class B Notes, to the holders of such Auction Rate Notes, the Interest
Distribution Amount for such Class B Notes on a pro rata basis;
(7) Seventh, to the Future Distribution Account, an amount
necessary to provide for one month's expected interest payments on the
Class A Notes as described under Section 8.02(d)(iii);
(8) Eighth, to the Future Distribution Account, an amount
necessary to provide for one month's expected interest payments on the
Class B Notes as described under Section 8.02 (d)(iv);
(9) Ninth, to the Reserve Account, an amount, up to the
amount, if any, necessary to reinstate the balance of the Reserve
Account to the greater of the amounts determined pursuant to clauses
(b) and (c) of the definition of Specified Reserve Account Balance;
(10) Tenth, to XXXX, to purchase Rehabilitated Financed
Student Loans;
(11) Eleventh, to the holders of (i) the Class A-1 Notes,
until paid in full, then (ii) the Class A-2 Notes, until paid in full,
then (iii) the Class A-3 Notes, until paid in full, then (iv) the Class
A-4 Notes, until paid in full, and then (v) to the Class B-1 and the
Class B-2 Notes, on a pro rata basis, until paid in full, or to the
Future Distribution Account, as the case may be, the Noteholders'
Principal Distribution Amount, less any amounts distributed as
principal pursuant to priority Fifth (principal will be paid to the
holders of the Auction Rate Notes in lots of $50,000 only);
(12) Twelfth, to the holders of the Class B Notes or to the
Future Distribution Account, as the case may be, Xxxxxxxxx Amounts, if
any;
55
(13) Thirteenth, pro rata: (i) any unreimbursed advances to
FMC and (ii) for all amounts in excess of the maximum amounts specified
in clause (1): for Indenture Trustee fees and expenses; Owner Trustee
fees and expenses pursuant to the Trust Agreement; Grantor Trustee fees
and expenses pursuant to the Grantor Trust Agreement; indemnities and
expenses of the Servicers; the portion of the Administration Fee
allocated to the Notes and all unpaid Administration Fees from prior
Collection Periods allocated to the Notes; Broker-Dealer Fees and
expenses pursuant to the Broker-Dealer Agreements; Auction Agent Fees
and expenses pursuant to the Auction Agency Agreement and any Paying
Agent Fees;
(14) Fourteenth, to the holders of the Class A-1 Notes, any
remaining amounts until the Outstanding Principal Balance of that Class
is reduced to zero;
(15) Fifteenth, on and after the 10% Pool Balance Distribution
Date or a XXXX Trigger Event, to the holders of the Notes or to the
Future Distribution Account, as the case may be, any remaining amounts
as payment of principal allocated among the Noteholders as described in
clause (11) until the Outstanding Principal Balance of each Class of
Notes is reduced to zero; and
(16) Sixteenth, to FMC, any unpaid and accrued structuring
advisory fee, and then to the Certificateholders, any remaining
amounts.
SECTION 8.03 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 8.01(b); PROVIDED, HOWEVER, that funds in the Pre-Funding Account
shall be invested only in Eligible Investments described in clause (a) of the
definition thereof. 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 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 6.01(c), the Indenture Trustee shall
not in any way be held liable 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
56
(ii) a Default shall have occurred and be continuing, but the Notes shall not
have been declared due and payable pursuant to Section 5.02, 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 5.04 as if there had not been such a declaration; then
the Indenture Trustee shall, to the fullest extent practicable, invest and
reinvest funds in the Trust Accounts in one or more Eligible Investments.
SECTION 8.04 RELEASE OF INDENTURE TRUST ESTATE. (a) Subject to
the payment of its fees and expenses pursuant to Section 6.07, 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, all sums due the Indenture Trustee pursuant to Section 6.07
have been paid, release any remaining portion of the 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 8.04(b) only upon receipt of an Issuer Request
accompanied by an Officers' Certificate of the Issuer and an Opinion of Counsel
meeting the applicable requirements of Section 11.01.
SECTION 8.05 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 8.04(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.04(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
holders of the Notes in contravention of the provisions of this Indenture.
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.
SECTION 8.06 COST OF ISSUANCE ACCOUNT. The Issuer shall
establish and maintain in the name of the Indenture Trustee an Eligible Deposit
Account (the "Cost of Issuance Account"). The Cost of Issuance Account shall not
be a Trust Account and the Noteholders shall have no interest in the amount
deposited therein. The Cost of Issuance Account initially will be established as
a segregated account at U.S. Bank National Association in the name of the
Indenture Trustee. The Issuer shall make a deposit into the Cost of Issuance
Account on the Closing Date in an amount equal to $3,042,800. Upon receipt of
written instructions from the Administrator, the Indenture Trustee shall remit
funds on deposit in the
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Cost of Issuance Account to pay the costs and expenses incurred by the Issuer in
connection with issuing the Notes.
SECTION 8.07 APPLICATION OF COLLECTIONS. (a) With respect to
each Student Loan, all collections (including all Guarantee Payments) with
respect thereto for the Collection Period shall be applied to interest and
principal on such Student Loan by allocating to interest the portion of such
collection equal to the product of (A) the applicable interest rate on such
Student Loan, (B) the unpaid principal balance of such Student Loan, and (C) the
period of time elapsed since the preceding payment of interest on such Student
Loan was made (over the actual number of days in a year) ("Interest
Collections") and by allocating the remainder of such collection to principal.
(b) All Liquidation Proceeds shall be applied to the related
Student Loan.
SECTION 8.08 RESERVE ACCOUNT. (a) On the Closing Date, the
Issuer shall deposit the Reserve Account Initial Deposit into the Reserve
Account. The Trustee shall deposit into the Reserve Account the amounts, if any,
required to be deposited pursuant to Sections 8.02 and 8.11.
(b) (i) If the amounts payable for any Monthly Servicing
Payment Date or Quarterly Distribution Date pursuant to Section 8.02(g)(1)
exceed the amount distributed or allocated to the applicable parties on such
Monthly Servicing Payment Date or Quarterly Distribution Date, the Administrator
shall instruct the Indenture Trustee in writing to withdraw from the Reserve
Account on such Monthly Servicing Payment Date or Quarterly Distribution Date an
amount equal to such excess, to the extent of funds available therein, and to
distribute or allocate such amounts to the applicable parties PRO RATA (based
upon the amount owed to such parties).
(ii) If the amounts payable on each Quarterly
Distribution Date pursuant to Section 8.02(g)(2) exceed the amount
transferred to the Future Distribution Account on such Quarterly
Distribution Date, the Administrator shall instruct the Indenture
Trustee in writing to withdraw from the Reserve Account on such
Quarterly Distribution Date an amount equal to such excess, to the
extent of funds available therein after giving effect to
paragraph(b)(i), and to transfer such amount to the Future Distribution
Account.
(iii) If the amounts payable for any Quarterly
Distribution Date pursuant to Section 8.02(g)(3) exceed the amount
transferred to the XXXX Pledge Fund on such Quarterly Distribution
Date, the Administrator shall instruct the Indenture Trustee in writing
to withdraw from the Reserve Account on such Quarterly Distribution
Date an amount equal to such excess, to the extent of funds available
therein after giving effect to paragraphs (b)(i) through (b)(ii) above,
and to transfer such amount to the XXXX Pledge Fund.
(iv) If the Noteholders' Interest Distribution Amount
with respect to the Class A Notes for a Distribution Date exceeds the
amount distributed to the holders of the Class A Notes on such
Distribution Date, the Administrator shall instruct the
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Indenture Trustee in writing to withdraw from the Reserve Account on
such Distribution Date an amount equal to such excess, to the extent of
funds available therein after giving effect to paragraph (b)(i) through
(b)(iii) above, and to distribute such amount PRO RATA (based on the
amount of such excess allocable to the holders of the Class A Notes),
to the holders of the Class A Notes entitled thereto.
(v) If on the Final Maturity Date for a Class of
Class A Notes, the outstanding principal balance of the applicable
Class of Class A Notes (prior to giving effect to any distribution of
principal thereon on such date) exceeds the amount of principal
distributed to the holders of the applicable Class of Class A Notes on
such date, the Administrator shall instruct the Indenture Trustee in
writing on such date to withdraw from the Reserve Account on such date
an amount equal to such excess, to the extent of funds available
therein, after giving effect to paragraphs (b)(i) through (b)(iv) above
and to distribute such amount to the holders of the applicable Class of
Class A Notes, in the same order and priority as is set forth in
Section 8.02(g)(11).
(vi) If the Noteholders' Interest Distribution Amount
with respect to the Class B Notes for a Distribution Date exceeds the
amount distributed to the holders of the Class B Notes on such
Distribution Date, the Administrator shall instruct the Indenture
Trustee in writing to withdraw from the Reserve Account on such
Distribution Date an amount equal to such excess, to the extent of
funds available therein after giving effect to paragraph (b)(i) through
(b)(v) above, and to distribute such amount PRO RATA (based on the
amount of such excess allocable to the holders of the Class B Notes),
to the holders of the Class A Notes entitled thereto.
(vii) If on the Final Maturity Date for a Class of
Class B Notes, the outstanding principal balance of the applicable
Class of Class B Notes (prior to giving effect to any distribution of
principal thereon on such date) exceeds the amount of principal
distributed to the holders of the applicable Class of Class B Notes on
such date, the Administrator shall instruct the Indenture Trustee in
writing on such date to withdraw from the Reserve Account on such date
an amount equal to such excess, to the extent of funds available
therein, after giving effect to paragraphs (b)(i) through (b)(vi) above
and to distribute such amount to the holders of the applicable Class of
Class B Notes, PRO RATA (based on the Outstanding Principal Balance of
each such Class).
(c) If the amount on deposit in the Reserve Account on any
Quarterly Distribution Date (without giving effect to all deposits or
withdrawals therefrom on such Quarterly Distribution Date) is greater than the
Specified Reserve Account Balance for such Quarterly Distribution Date, the
Issuer shall instruct the Indenture Trustee in writing to deposit the amount of
such excess into the Collection Account for distribution on such Quarterly
Distribution Date.
SECTION 8.09 STATEMENTS TO NOTEHOLDERS. On each Determination
Date preceding a Quarterly Distribution Date, pursuant to the Administration
Agreement the Administrator shall provide to the Indenture Trustee (with a copy
to the Owner Trustee and the Rating Agencies) for the Indenture Trustee to
forward on such succeeding Quarterly Distribution Date to each holder of record
of the Notes a statement substantially in the form set forth as an
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exhibit to the Administration Agreement setting forth at least the following
information as to the Notes, to the extent applicable:
(1) the amount of the distribution allocable to
principal of each Class of Notes;
(2) the amount of the distribution allocable to
interest on each Class of Notes, together with the interest
rates applicable with respect thereto;
(3) the Pool Balance as of the close of business on
the last day of the preceding Collection Period, after giving
effect to the related payments allocated to principal reported
under clause (1) above;
(4) the aggregate outstanding principal balance or
Notional Amount, as applicable, of each Class of Notes as of
such Quarterly Distribution Date, after giving effect to
related payments allocated to principal reported under clause
(1) above;
(5) for each Quarterly Distribution Date (A) the
amount of fees and expenses paid to the Indenture Trustee and
the Owner Trustee; (B) the amount of the Servicing Fee paid to
each Servicer; (C) the amount of fees and expenses paid to
each Broker-Dealer and the Auction Agent; (D) the amount of
fees paid to XXXX; and (E) the amount of the Administration
Fee paid to the Administrator, and, in each case, with respect
to such Collection Period, together with the amount, if any,
remaining unpaid after giving effect to all such payments;
(6) for each Quarterly Distribution Date, the amount
of the aggregate Realized Losses for the Financed Student
Loans, if any, for such Collection Period and the balance of
the Financed Student Loans that are delinquent in each
delinquency period as of the end of such Collection Period;
(7) the balance of the Reserve Account on such
Quarterly Distribution Date, after giving effect to changes
therein on such Quarterly Distribution Date;
(8) the amounts withdrawn from the Reserve Account on
such Quarterly Distribution Date;
(9) for Quarterly Distribution Dates during the
Funding Period, the remaining Pre-Funded Amount on such
Quarterly Distribution Date, after giving effect to changes
therein during the related Collection Period;
(10) for the first Quarterly Distribution Date on or
following the end of the Funding Period, the amount of any
remaining Pre-Funded Amount that has not been used to make
Additional Fundings with respect to Additional Student Loans
and is being deposited into the Collection Account; and
(11) the amount of any Advance with respect to such
Distribution Date;
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(12) the amount transferred to the XXXX Pledge Fund
to acquire Rehabilitated Student Loans with respect to such
Distribution Date; and
Each amount set forth pursuant to clauses (1), (2),
(3), (5) and (6) above shall be expressed as a dollar amount
per $50,000 of original principal balance of a Note. A copy of
the statements referred to above may be obtained by any Note
Owner by a written request to the Indenture Trustee addressed
to the Corporate Trust Office.
On each Determination Date preceding an Auction Rate Note Interest
Payment Date, the Administrator shall provide to the Indenture Trustee (with a
copy to the Owner Trustee and the Rating Agencies) for the Indenture Trustee to
forward to each holder of record of the applicable Class of Notes a statement
setting forth the information in clauses (1) and (2) above with respect to the
related Auction Rate Notes.
SECTION 8.10 PRE-FUNDING ACCOUNT. (a) On the Closing Date, the
Issuer will deposit in the Pre-Funding Account, $46,168,158.02, to be used by
the Trust to acquire Subsequent Student Loans and as otherwise provided in this
Section 8.10. On each Subsequent Transfer Date during the Funding Period on
which Subsequent Student Loans are to be conveyed to the Issuer, the Issuer
shall instruct the Indenture Trustee in writing to withdraw from the Pre-Funding
Account an amount up to 109.8% of the sum of the principal balance of, plus to
the extent capitalized or to be capitalized upon commencement of repayment or
during deferment or forbearance, accrued interest on, such Subsequent Student
Loans. The Administrator shall instruct the Indenture Trustee in writing to
distribute such amount as directed by the Administrator; provided, however, upon
each acquisition of Subsequent Student Loans, the amount deposited in the XXXX
Pledge Fund must be equal to or greater than 6% of the principal balance of such
Subsequent Student Loans being acquired.
(b) If the Pre-Funded Amount has not been reduced to zero on
or prior to the Distribution Date on which the Funding Period ends (or, if the
Funding Period does not end on a Distribution Date, on or prior to the first
Distribution Date following the end of the Funding Period) after giving effect
to any reductions in the Pre-Funded Amount on such Distribution Date pursuant to
paragraph (a) above, the Administrator shall instruct the Indenture Trustee in
writing to transfer on such Distribution Date from the Pre-Funding Account to
the Collection Account an amount equal to the funds remaining in the Pre-Funding
Account. Any such funds so transferred shall be considered Available Funds for
the related Distribution Date.
SECTION 8.11 ADVANCES. (a) On or prior to any Quarterly
Distribution Date, a Certificateholder may, but shall not be obligated to, make
an optional deposit (each, an "Optional Deposit") to the Reserve Account from
funds to be released to such Certificateholder pursuant to Sections 8.02(g)(16)
on such Distribution Date or otherwise. Any such Optional Deposit shall be
applied on the related Distribution Date in the same manner as other funds on
deposit in the Reserve Account on the related Distribution Date in accordance
with Section 8.08.
(b) If on any Determination Date the amount required to be
distributed on the upcoming Monthly Servicing Payment Date or Distribution Date
pursuant to Sections 8.02(e)(i), 8.02(f), or 8.02(g)(1), as the case may be,
would exceed the sum of the aggregate amount in the
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Collection Account, the Future Distribution Account and the Reserve Account, the
Administrator, in its sole option, may elect to deposit, or have an Affiliate
deposit, in the Reserve Account (no later than the Business Day immediately
preceding such Monthly Servicing Payment Date or Distribution Date) an amount up
to the amount of such deficiency (such deposit, is referred to as an "Advance").
SECTION 8.12 FUTURE DISTRIBUTION ACCOUNT. The Indenture
Trustee shall make deposits into and withdrawals from the Future Distribution
Account as provided in Section 8.02. To the extent amounts to be paid to the
Noteholders or any other Person are in the Future Distribution Account, the
Indenture Trustee, based upon written instructions received from the
Administrator, shall transfer such amounts from the Future Distribution Account
to the Collection Account and make such payments from the Collection Account.
ARTICLE IX
Supplemental Indentures
SECTION 9.01 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF
NOTEHOLDERS. (a) Without the consent of any holders of the Notes 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, 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 holders of the Notes, or to surrender any right or power
herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge
any property to or with 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 holders of the Notes; or
(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
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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.
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 Administrator, on behalf of the Issuer and the
Indenture Trustee, when authorized by an Issuer Order, may, also without the
consent of any of the holders of the Notes but upon satisfying the Rating Agency
Condition, 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 including changing the Auction
Procedures for the Auction Rate Notes, or of modifying in any manner the rights
of the holders of the Notes 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 holder of the Notes.
SECTION 9.02 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 Interested Noteholders holding a majority of the Outstanding Amount of
the related Classes of Notes, may 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 holders of the Notes under this
Indenture; PROVIDED, HOWEVER, that no such supplemental indenture shall, without
the consent of the holder of each Outstanding Note affected thereby:
(i) change the date of payment of any installment of
principal of or interest on each Class of Notes, or reduce the
principal amount thereof or the interest rate thereon, 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 applicable 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;
(ii) reduce the percentage of the Outstanding Amount
of the Notes, the consent of the holders of which is required for any
such supplemental indenture, or the consent of the holders of the Notes
of which is required for any waiver of compliance with certain
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";
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(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 5.04;
(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 holder 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 applicable Note on any
Distribution Date (including the calculation of any of the individual
components of such calculation);
(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 holder of any Note
of the security provided by the lien of this Indenture; or
(viii) or change the definition of Interested
Noteholders.
It shall not be necessary for any Act of holders of the Notes 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 holders of the Notes to which such amendment or supplemental
indenture relates a notice prepared by the Issuer 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 9.03 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 6.01 and 6.02, 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.
SECTION 9.04 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, and the respective rights, limitations of rights, obligations,
duties, liabilities and immunities under this Indenture of the Indenture
Trustee, the Issuer and the holders of the Notes shall thereafter be determined,
exercised and enforced hereunder subject in all respects to such modifications
and amendments, and all the
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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 9.05 [RESERVED]
SECTION 9.06 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.
SECTION 9.07 CONFORMITY WITH THE TRUST INDENTURE ACT. Every
Supplemental Indenture executed pursuant to this Article IX shall conform to the
requirements of the TIA as then in effect.
ARTICLE X
Reporting Requirements
SECTION 10.01 ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer
will cause each Servicer to deliver to the Administrator, any applicable annual
statements as to compliance required by the Servicer's Servicing Agreement.
Copies of any such annual statements will be provided to the Rating Agencies
rating the Notes.
SECTION 10.02 ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING
REPORT. Within 90 days of the end of each Servicer's regular fiscal-year or
calendar-year audit period, the Issuer shall cause each Servicer, at the
Servicer's expense, to cause a firm of independent public accountants to furnish
a statement to the Administrator and the Indenture Trustee in accordance with
the Servicer's Servicing Agreement. Copies of any such statement shall be
provided to the Rating Agencies rating the Notes.
ARTICLE XI
Miscellaneous
SECTION 11.01 COMPLIANCE CERTIFICATES AND OPINIONS, ETC. 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 (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 and (ii) an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent, if any, have
been complied with, 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.
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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 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.
SECTION 11.02 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 Servicers, the
Issuer or the Administrator, stating that the information with respect to such
factual matters is in the possession of such Servicer, 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
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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 truth and accuracy of any
statement or opinion contained in any such document as provided in Article VI.
SECTION 11.03 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 holders of the Notes may be embodied in
and evidenced by one or more instruments of substantially similar tenor signed
by such holders of the Notes, 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 holders of the
Notes, 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 6.01) 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 the holder of any Notes shall bind the holder
of every Note issued upon the registration 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 11.04 NOTICES, ETC., TO INDENTURE TRUSTEE, ISSUER AND
RATING AGENCIES. Any request, demand, authorization, direction, notice, consent,
waiver or Act of holders of Notes, 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 holders of Notes, is to be made
upon, given or furnished to or filed with:
(a) the Indenture Trustee by any holder of Notes, 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.
(b) the Issuer by the Indenture Trustee or by any holder of
Notes shall be sufficient for every purpose hereunder if in writing and mailed,
first-class, postage prepaid, to the Issuer addressed to: The National
Collegiate Student Loan Trust 2004-1, c/o Wachovia Trust Company, National
Association, as Owner Trustee, Xxx Xxxxxx Xxxxxx, 1st Floor, 000 Xxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Administration; with a
copy to: The First Marblehead Corporation, The Prudential Tower, 000 Xxxxxxxx
Xxxxxx, 00xx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000-8157, Attention: Controller,
with a copy to Xxxxxxx X. Xxxxxxx, Esq., or at any other address previously
furnished in writing to the Indenture Trustee by the
67
Issuer or the Administrator. The Issuer shall promptly transmit any notice
received by it from the holders of the Notes to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the Issuer, the Indenture
Trustee or the Owner 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: Xxxxx'x Investors Service, Inc., ABS Monitoring
Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000; (ii) in the case of
Standard & Poor's, at the following address: Standard & Poor's Rating Services,
00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of Asset Backed
Surveillance Department; and (iii) in the case of Fitch, at the following
address: Fitch, Inc., One State Street Plaza, Attention: ABS Surveillance, New
York, NY 10004, SF; or as to each of the foregoing, at such other address as
shall be designated by written notice to the other parties.
SECTION 11.05 NOTICES TO NOTEHOLDERS; WAIVER. Where this
Indenture provides for notice to holders of Notes 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 holder of Notes
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 holders of the Notes
is given by mail, neither the failure to mail such notice nor any defect in any
notice so mailed to any particular holder of Notes shall affect the sufficiency
of such notice with respect to other holders of Notes, 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 holders of the Notes 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 holders of the Notes 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 11.06 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 holder of the Notes
providing for a method of payment, or notice by the Indenture Trustee or any
Paying Agent to such holder of the Notes that is different from the methods
provided for 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.
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SECTION 11.07 [RESERVED]
SECTION 11.08 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 11.09 SUCCESSORS AND ASSIGNS. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successors 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, and the holders of the Notes, and
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, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. THIS
INDENTURE IS SUBJECT TO THE PROVISIONS OF THE TIA THAT ARE REQUIRED TO BE PART
OF THIS INDENTURE AND SHALL, TO THE EXTENT APPLICABLE, BE GOVERNED BY SUCH
PROVISIONS.
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 holders of the Notes or
any other Person secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture.
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SECTION 11.16 TRUST OBLIGATIONS. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the
Administrator, the Servicer, the Owner 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 Administrator, the Servicer,
the Indenture Trustee or the Owner Trustee in its individual capacity or (ii)
any partner, owner, beneficiary, agent, officer, director, employee or agent of
the Administrator, the Servicer, the Indenture Trustee or the Owner Trustee in
its individual capacity, any holder or owner of a beneficial interest in the
Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign
of the Administrator, the Servicer, the Indenture Trustee or the Owner Trustee
in its individual capacity, except as any such Person may have expressly agreed
(it being understood that the Indenture Trustee and the Owner 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.
This Indenture is executed and delivered by Wachovia Trust Company,
National Association ("Wachovia"), not individually or personally but solely as
Owner Trustee of the Issuer in the exercise of the powers and authority
conferred and vested in it and each of the representations, undertakings and
agreements herein made on the part of the Issuer is made and intended not as
personal representations, undertakings and agreements by Wachovia but is made
and intended for the purpose of binding only the Issuer and under no
circumstances shall Xxxxxxxx be personally liable for the payment of any
indebtedness or expenses of the Issuer or be liable for the breach or failure of
any obligation, representation, warranty or covenant made or undertaken by the
Issuer under this Indenture or otherwise.
SECTION 11.17 NO PETITION. The Indenture Trustee, by entering
into this Indenture, and each holder of each Class of the Notes, by accepting a
Note, hereby covenant and agree that they will not at any time institute against
the Issuer, or join in any institution against 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.
SECTION 11.18 INSPECTION. The Issuer agrees that, on
reasonable prior notice, it will 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 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.
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SECTION 11.19 THIRD-PARTY BENEFICIARIES. This Indenture will
inure to the benefit of and be binding upon the parties hereto, the Noteholders,
the Note Owners and their respective successors and permitted assigns. Except as
otherwise provided in this Indenture, no other person will have any right or
obligation hereunder.
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IN WITNESS WHEREOF, the Issuer 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.
THE NATIONAL COLLEGIATE STUDENT
LOAN TRUST 2004-1,
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee,
By: /s/ Xxxxxxxx X. Xxxxxxx
--------------------------------------
Name: Xxxxxxxx X. Xxxxxxx
Title: Vice President
U.S. BANK NATIONAL ASSOCIATION,
not in its individual capacity but solely as
Indenture Trustee,
By: /s/ Xxxxxx Xxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
72
STATE OF DELAWARE )
) ss.:
COUNTY OF NEW CASTLE )
On the 2nd day of June in the year 2004, before me, the undersigned,
personally appeared Xxxxxxxx X. Xxxxxxx, an Authorized Officer, of WACHOVIA
TRUST COMPANY, NATIONAL ASSOCIATION, as Owner Trustee of THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1, personally known to me or proved to me on the basis
of satisfactory evidence to be the individual whose name is subscribed to the
within instrument and acknowledged to me that he executed the same in his
capacity, and that by his signature on the instrument, the individual, or the
person upon behalf of which the individual acted, executed the instrument.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this 2nd day of June, 2004.
/s/ Xxxxx X. Xxxxxxxx
------------------------
Notary Public in and for
the State of Delaware.
My commission expires: October 9, 2004
STATE OF Massachusetts )
) ss.:
COUNTY OF Suffolk )
On the 10th day of June in the year 2004, before me, the undersigned,
personally appeared Xxxxxx X. Xxxxxxx, a Vice President of U.S. BANK NATIONAL
ASSOCIATION, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
GIVEN UNDER MY HAND AND SEAL OF OFFICE, this 10th day of June, 2004.
/s/ Xxxxx Xxx
Notary Public in and for
the State of MA.
My commission expires: April 21, 2006
APPENDIX A
DEFINITIONS AND USAGE
USAGE
The following rules of construction and usage shall be applicable to any
instrument that is governed by 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 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.
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DEFINITIONS
"ACCOUNTANT" means PricewaterhouseCoopers LLP and any other
independent certified public accountant as may be selected by the Issuer and
satisfying the Rating Agency Condition.
"ACT" has the meaning specified in Section 11.03(a) of the
Indenture.
"ADDITIONAL FUNDINGS" means the moneys transferred from the
Pre-Funding Account on Subsequent Transfer Dates during the Funding Period, and
shall consist of amounts paid to the applicable Seller to acquire Subsequent
Student Loans as of the applicable Subsequent Cut-off Dates, to pay capitalized
interest on the Student Loans, as applicable, and to remit to the Collection
Account if the amount on deposit in the XXXX Pledge Fund is less than the amount
specified in Section 8.10 of the Indenture.
"ADMINISTRATION AGREEMENT" means the Administration Agreement
dated as of June 10, 2004, among the Issuer, the Indenture Trustee, the Owner
Trustee and the Administrator.
"ADMINISTRATION FEE" has the meaning specified in Section 3 of
the Administration Agreement.
"ADMINISTRATOR" means First Marblehead Data Services, Inc., a
Massachusetts corporation, in its capacity as administrator of the Issuer and
the Financed Student Loans, and its successors and permitted assigns.
"ADMINISTRATOR DEFAULT" means the occurrence of any event
specified in Section 8(d) of the Administration Agreement.
"ADVANCE" has the meaning specified in Section 8.11(b) of the
Indenture.
"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.
"APPLICABLE INDEX" means with respect to the Class A-1, A-2,
A-3 and A-4 Notes, Three-Month LIBOR; PROVIDED, HOWEVER, with respect to the
initial Interest Period, the Applicable Index shall be determined by the
following formula:
X + [17/30*(Y-X)]
Where: X = Three-Month LIBOR, and
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Y = Four-Month LIBOR, in each case, as of the second
business day before the start of the initial Interest
Period.
"APPLICABLE NOTE MARGIN" means: 0.12% for the Class A-1 Notes,
0.26% for the Class A-2 Notes, 0.38% for the Class A-3 Notes, and 0.43% for the
Class A-4 Notes.
"APPLICABLE NOTE RATE" means, with respect to the Class A-IO-1
Notes, 7.87% per annum and with respect to the Class A-IO-2 Notes, 0.12% per
annum.
"APPLICABLE PROCEDURES" has the meaning specified in Section
2.04(j)(i) of the Indenture.
"AUCTION RATE NOTES" means the Class B-1 Notes and the Class
B-2 Notes.
"AUTHORIZED OFFICER" means, with respect to any Person, any
Person who is authorized to act for such Person in matters relating to the Basic
Documents and whose action is binding upon such Person. With the respect to the
Issuer, "Authorized Officer" means any officer of the Owner Trustee and/or the
Administrator who is authorized to act for the Owner Trustee and/or the
Administrator in matters relating to the Issuer. With respect to the Indenture
Trustee, "Authorized Officer" means any officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the above
designated officers 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.
"AVAILABLE FUNDS" means, with respect to any Distribution
Date, any Monthly Servicing Payment Date or any other distribution date pursuant
to Section 5.04 of the Indenture, the sum of the following amounts received with
respect to the then elapsed portion of the related Collection Period to the
extent not previously distributed:
(i) all collections received by a Servicer (or any
Sub-Servicer acting on its behalf) on the Student Loans,
(including any Guarantee Payments received) but net of any
applicable administrative fees, late fees or similar fees
received from a borrower;
(ii) all Liquidation Proceeds and all Recoveries in
respect of Liquidated Student Loans which were written off in
prior Collection Periods or prior months of such Collection
Period;
(iii) the aggregate Purchase Amounts received for
Student Loans repurchased by a Seller or a Servicer or under
an obligation which arose during the elapsed portion of such
Collection Period;
(iv) Investment Earnings for such Distribution Date;
(v) amounts withdrawn from the Reserve Account in
excess of the Specified Reserve Account Balance and deposited
into the Collection Account;
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(vi) amounts transferred from the Pre-Funding Account
to the Collection Account;
(vii) amounts on deposit in the Future Distribution
Account;
(viii) Advances and Optional Deposits, if any; and
(ix) any proceeds received in connection with the
sale of the Student Loans, or sums collected by the Indenture
Trustee pursuant to Sections 5.03 or 5.04(a) of the Indenture;
PROVIDED, HOWEVER, that Available Funds will exclude all
payments and proceeds (including Liquidation Proceeds) of any
Student Loans, the related Purchase Amount of which has been
included in Available Funds, for a prior Distribution Date;
PROVIDED, FURTHER, that if on any Distribution Date there
would not be sufficient funds, after application of Available
Funds and amounts available from the Reserve Account, the
Future Distribution Account and the Pre-Funding Account, to
pay any of the items specified in clauses (1) through (6) of
Section 8.02(g) of the Indenture for such Distribution Date,
then Available Funds for such Distribution Date will include,
in addition to the Available Funds, amounts being held
pursuant to Section 8.01 of the Indenture, or on deposit in
the Collection Account, with respect to Available Funds
relating to such Distribution Date which would have
constituted Available Funds for the Distribution Date
succeeding such Distribution Date, up to the amount necessary
to pay the items specified in clause (1) through (6) of
Section 8.02(g) of the Indenture, and the Available Funds, for
such succeeding Distribution Date will be adjusted
accordingly.
"BASIC DOCUMENTS" means the Trust Agreement, the Grantor Trust
Agreement, the Indenture, all Student Loan Purchase Agreements, the Deposit and
Sale Agreement, all Servicing Agreements, the Administration Agreement, the
Custodial Agreement, the Note Depository Agreement, the Guarantee Agreements,
the XXXX Deposit and Security Agreement, the Auction Agent Agreement, the Broker
Dealer Agreements, any Program Manual and other documents and certificates
delivered in connection with any thereof.
"BENEFICIAL OWNER" means, with respect to a Note, the Person
who is the beneficial owner of such Note, as reflected on the books of the
Depository or on the books of a Person maintaining an account with such
Depository (directly or as an indirect participant, in accordance with the rules
of such Depository), as the case may be.
"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 any day other than a Saturday, a Sunday
or a day on which banking institutions or trust companies in New York City or
the city in which the designated corporate trust office of the Indenture Trustee
is located, are authorized or obligated by law, regulation or executive order to
remain closed.
A-4
"CERTIFICATE" means the Trust Certificate issued pursuant to
the Trust Agreement, substantially in the form of Exhibit 1 thereto.
"CERTIFICATEHOLDER" means the Person in whose name a
Certificate is registered.
"CLASS" means reference to any of the Class A-1, Class A-2,
Class A-3, Class A-4, Class A-IO-1, Class A-IO-2 Class B-1 or Class B-2 Notes,
as applicable.
"CLASS A NOTES" means the Class A-1 Notes, Class A-2 Notes,
Class A-3 Notes, Class A-4 Notes, Class A-IO-1 Notes and Class A-IO-2 Notes.
"CLASS A-1 NOTE" means a Class A-1 Note issued pursuant to the
Indenture, substantially in the form of Exhibit A-1 thereto.
"CLASS A-2 NOTE" means a Class A-2 Note issued pursuant to the
Indenture, substantially in the form of Exhibit A-2 thereto.
"CLASS A-3 NOTE" means a Class A-3 Note issued pursuant to the
Indenture, substantially in the form of Exhibit A-3 thereto.
"CLASS A-4 NOTE" means a Class A-4 Note issued pursuant to the
Indenture, substantially in the form of Exhibit A-4 thereto.
"CLASS A-IO NOTES" means the Class A-IO-1 Notes and the Class
A-IO-2 Notes.
"CLASS A-IO-1 NOTE" means a 7.87% Class A-IO-1 Note issued
pursuant to the Indenture, substantially in the form of Exhibit A-5 thereto.
"CLASS A-IO-2 NOTE" means a 0.12% Class A-IO-2 Note issued
pursuant to the Indenture, substantially in the form of Exhibit A-6 thereto.
"CLASS B NOTES" means the Class B-1 Notes and the Class B-2
Notes.
"CLASS B-1 NOTE" means an Auction Rate Class B-1 Note issued
pursuant to the Indenture, substantially in the form of Exhibit A-7 thereto.
"CLASS B-2 NOTE" means an Auction Rate Class B-2 Note issued
pursuant to the Indenture, substantially in the form of Exhibit A-8 thereto.
"CLEARING AGENCY" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
"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.
"CLEARSTREAM" means Clearstream Banking, a societe anonyme, a
limited liability company organized under the laws of Luxembourg.
A-5
"CLOSING DATE" means June 10, 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 8.02(a)(i) of the Indenture.
"COLLECTION PERIOD" means, with respect to the first Quarterly
Distribution Date, the period beginning on the Cutoff Date and ending on August
31st, 2004, and with respect to each subsequent Quarterly Distribution Date, the
Collection Period means the three calendar months immediately following the end
of the previous Collection Period.
"CORPORATE TRUST OFFICE" means (i) with respect to the
Indenture Trustee and the Note Registrar (so long as the Indenture Trustee is
the Note Registrar), the designated 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 Xxx Xxxxxxx Xxxxxx, 0xx Xxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000, Attention: The National Collegiate Student Loan Trust
2004-1 (facsimile: (000) 000-0000) or at such other address as the Indenture
Trustee may designate from time to time by notice to the Noteholders, the
Administrator, 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 Owner Trustee, the principal corporate trust office of
the Owner Trustee located at Xxx Xxxxxx Xxxxxx, 0xx Xxxxx, 000 Xxxx Xxxxxx,
Xxxxxxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust Administration
(facsimile: (000) 000-0000); or at such other address as the Owner Trustee may
designate by notice to the Certificateholder, the Administrator, and the
Depositor, or corporate trust office of any successor Owner Trustee (the address
of which the successor Owner Trustee will notify the Certificateholder, the
Administrator, and the Depositor).
"COST OF ISSUANCE ACCOUNT" means the account designated as
such, established and maintained pursuant to Section 8.06 of the Indenture.
"CREDIT-WORTHY COSIGNED LOAN" means a loan made to a borrower
to pay the costs of attendance at a school approved under the Student Loan
Programs, which loan (i) was originated and underwritten to a credit-worthy
standard as set forth in the related Program Manual with at least two signatures
on the note evidencing such Student Loan, and (ii) is guaranteed by XXXX.
"CREDIT-WORTHY NON-COSIGNED LOAN" means a loan made to a
borrower to pay the costs of attendance at a school approved under the Student
Loan Programs, which loan (i) was originated and underwritten to a credit-worthy
standard as set forth in the related Program Manual with one signature on the
note evidencing such Student Loan, and (ii) is guaranteed by XXXX.
"CREDIT-READY LOAN" means a loan made to a borrower to pay the
costs of attendance at a school approved under the Student Loan Programs, which
loan (i) was originated
A-6
and underwritten to a credit-ready standard as set forth in the related Program
Manual with one signature on the note evidencing such Student Loan, and (ii) is
guaranteed by XXXX.
"CUMULATIVE DEFAULT RATE" means, as of any Quarterly
Distribution Date, the percentage equivalent of the fraction (a) the numerator
of which is the cumulative principal balance of the Financed Student Loans which
are Defaulted Student Loans on the last day of the Collection Period related to
such Quarterly Distribution Date, and (b) the denominator of which is the
cumulative principal balance (on a loan by loan basis, the beginning principal
balance of each Financed Student Loan on the first date each loan first enters
repayment status) of all Financed Student Loans that have entered repayment
status plus any prepayments on such Financed Student Loans that have occurred
prior to those Financed Student Loans entering repayment.
"CUSTODIAL AGREEMENTS" means, the Custodial Agreements, dated
as of June 10, 2004, between each Servicer and the Indenture Trustee.
"CUTOFF DATE" means with respect to the Initial Financed
Student Loans, May 31, 2004.
"DEFAULT" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"DEFAULTED STUDENT LOAN" means a Financed Student Loan for
which a XXXX Guaranty Event has occurred.
"DEFINITIVE NOTES" has the meaning specified in Section 2.10
of the Indenture.
"DELIVERY" or "DELIVER" when used with respect to Trust
Account Property means the following and such additional or alternative
procedures as may hereafter become appropriate to effect the complete transfer
of ownership of any such Collateral to the Indenture Trustee, free and clear of
any adverse claims, consistent with changes in applicable law or regulations or
the interpretation thereof:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute instruments and
are susceptible of physical delivery ("Physical Property"):
(b) transfer of possession thereof to the Indenture Trustee endorsed to, or with
respect to a certificated security:
(i) delivery thereof in bearer form
to the Indenture Trustee; or
(ii) delivery thereof in registered
form to the Indenture Trustee and
(A) the certificate is
endorsed to the Indenture Trustee or in blank by effective
endorsement; or
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(B) the certificate is
registered in the name of the Indenture Trustee, upon original
issue or registration of transfer by the issuer;
(c) with respect to an uncertificated security:
(i) the delivery of the
uncertificated security to the Indenture Trustee; or
(ii) the issuer has agreed that it
will comply with instructions originated by the Indenture
Trustee, without further consent by the registered owner;
(d) with respect to any security issued by the U.S. Treasury, the Federal Home
Loan Mortgage Corporation or by the Federal National Mortgage Association that
is a book-entry security held through the Federal Reserve System pursuant to
Federal book-entry regulations:
(i) a Federal Reserve Bank by book
entry credits the book-entry security to the securities
account (as defined in 31 CFR Part 357) of a participant (as
defined in 31 CFR Part 357) which is also a securities
intermediary; and
(ii) the participant indicates by
book entry that the book-entry security has been credited to
the Indenture Trustee's securities account, as applicable;
(e) with respect to a security entitlement:
(i) the Indenture Trustee, becomes
the entitlement holder; or
(ii) the securities intermediary has
agreed that it will comply with entitlement orders originated
by the Indenture Trustee;
(f) without further consent by the entitlement holder for the purpose of clauses
(b) and (c) hereof "delivery" means:
(i) with respect to a certificated
security:
(A) the Indenture Trustee,
acquires possession thereof;
(B) another person (other
than a securities intermediary) either acquires possession
thereof on behalf of the Indenture Trustee or, having
previously acquired possession thereof, acknowledges that it
holds for the Indenture Trustee; or
(C) a securities
intermediary acting on behalf of the Indenture Trustee
acquires possession of thereof, only if the certificate is in
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registered form and has been specially endorsed to the
Indenture Trustee by an effective endorsement;
(ii) with respect to an
uncertificated security:
(A) the issuer registers
the Indenture Trustee as the registered owner, upon original
issue or registration of transfer; or
(B) another person (other
than a securities intermediary) either becomes the registered
owner thereof on behalf of the Indenture Trustee, or, having
previously become the registered owner, acknowledges that it
holds for the Indenture Trustee;
(g) for purposes of this definition, except as otherwise indicated, the
following terms shall have the meaning assigned to each such term in the UCC:
(i) "certificated security"
(ii) "effective endorsement"
(iii) "entitlement holder"
(iv) "instrument"
(v) "securities account"
(vi) "securities entitlement"
(vii) "securities intermediary"
(viii) "uncertificated security"
(h) in each case of Delivery contemplated herein, the Indenture Trustee shall
make appropriate notations on its records, and shall cause same to be made of
the records of its nominees, indicating that securities are held in trust
pursuant to and as provided in this Agreement.
"DEPOSIT AND SALE AGREEMENT" means the Deposit and Sale
Agreement dated as of June 1, 2004, between the Depositor and the Issuer
pursuant to which the Depositor transfers Student Loans to the Issuer.
"DEPOSITOR" means The National Collegiate Funding LLC, as
depositor under the Trust Agreement and any successor thereto or assignee
thereof.
"DEPOSITORY" means The Depository Trust Company, a New York
corporation, its successors and assigns.
"DEPOSITORY PARTICIPANT" means a Person for whom, from time to
time, the Depository effects book-entry transfers and pledges of securities
deposited with the Depository.
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"DETERMINATION DATE" means, with respect to any Monthly
Servicing Payment Date or Distribution Date, as the case may be, the third
Business Day preceding such Monthly Servicing Payment Date or Distribution Date.
"DISTRIBUTION DATE" means, a Quarterly Distribution Date
and/or an Auction Rate Note Interest Payment Date.
"DTC" means the Depository Trust Company, a New York
corporation.
"DTC CUSTODIAN" means the Indenture Trustee as a custodian for
DTC.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated
account with an Eligible Institution, (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 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 at least two nationally
recognized Rating Agencies in one of their respective generic rating categories
which signifies investment grade, or (c) any other account that is acceptable to
the Rating Agencies (as evidenced by written confirmation to the Indenture
Trustee from each Rating Agency that the use of such account satisfies the
Rating Agency Condition).
"ELIGIBLE INSTITUTION" means a depository institution (which
may be, without limitation, the Indenture Trustee or any Affiliate of the
Indenture Trustee) organized under the banking laws of the United States of
America or any one of the States (or any domestic branch of a foreign bank), (a)
which has (i) a short-term senior unsecured debt rating of "P-1" or better by
Xxxxx'x, (ii) either (A) a long term senior unsecured debt rating of "AAA" by
S&P or (B) a short-term senior unsecured debt rating "A-1+" by S&P, and (iii) a
short-term senior unsecured debt rating of "F-1" or better by Fitch or any other
long-term, short-term or certificate of deposit rating acceptable to the Rating
Agencies, and (b) whose deposits are insured by the FDIC.
"ELIGIBLE INVESTMENTS" mean 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;
(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, HOWEVER, that (i) each such
investment has an original maturity of less than 365 days and (ii) at the time
of the investment or contractual commitment to invest therein (which shall be
deemed to be made again each time funds are reinvested following each
Distribution Date, as the case may be), the commercial paper or other short-term
senior unsecured debt obligations (other than such obligations the rating of
which is based on the credit
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of a Person other than such depository institution or trust company) thereof
shall have a credit rating from Xxxxx'x, S&P and Fitch in the highest investment
category granted thereby;
(c) commercial paper having an original maturity of less than 365 days and
having, at the time of the investment or contractual commitment to invest
therein, a rating from Xxxxx'x, S&P and Fitch in the highest investment category
granted thereby;
(d) investments in money market funds (including funds for which the Indenture
Trustee or the Owner Trustee or any of their respective Affiliates is an
investment manager or advisor) that (i) maintain a stable $1.00 net asset value
per share, (ii) are freely transferable on a daily basis, (iii) invests only in
other Eligible Investments, and (iv) have a rating from Xxxxx'x, S&P and Fitch
in the highest investment category granted thereby;
(e) bankers' acceptances having an original maturity of less than 365 days and
issued by any depository institution or trust company referred to in clause (b)
above; and
(f) any other investment permitted by each of the Rating Agencies and as set
forth in writing delivered to the Indenture Trustee; PROVIDED that such
investment is consistent with the definition of an "eligible investment"
contained in FASB 140, Paragraph 35.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"EUROCLEAR" means the Euroclear System, or any successor
thereto.
"EVENT OF DEFAULT" has the meaning specified in Section 5.01
of the Indenture.
"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, the Assistant Secretary or the Treasurer of such
corporation; and with respect to any partnership, any general partner xxxxxxx.
"FASB" means the Financial Accounting Standards Board.
"FDIC" means the Federal Deposit Insurance Corporation.
"FINAL MATURITY DATE" means for the (i) Class A-1 Notes, the
June 2014 Quarterly Distribution Date, (ii) Class A-2 Notes, the June 2027
Quarterly Distribution Date, (iii) Class A-3 Notes, the June 2029 Quarterly
Distribution Date, (iv) Class A-4 Notes, the June 2031 Quarterly Distribution
Date, (v) Class A-IO-1 Notes, the June 2010 Quarterly Distribution Date, (vi)
Class A-IO-2 Notes, the June 2031 Quarterly Distribution Day, (vii) Class B-1
Notes, June 1, 2039, and (viii) Class B-2 Notes, June 1, 2039.
"FINANCED STUDENT LOANS" means the collective reference to the
Initial Financed Student Loans and the Subsequent Student Loans.
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"FINANCED STUDENT LOAN NOTE" means the original fully executed
copy of the note (or a copy of a fully executed master promissory note)
evidencing each Financed Student Loan.
"FMC" means The First Marblehead Corporation.
"FITCH" means Fitch, Inc., and its successors and assigns.
"FORMULA RATE" means for any Interest Period with respect to
the Class A-1, A-2, A-3 and A-4 Notes, the Applicable Index plus the Applicable
Note Margin.
"FIVE-MONTH LIBOR" see "One-Month LIBOR" herein.
"FOUR-MONTH LIBOR" see "One-Month LIBOR" herein.
"FUNDING PERIOD" means the period beginning on the Closing
Date and ending on the first to occur of (a) the date on which an Event of
Default, a Servicer Default or an Administrator Default occurs, (b) the date on
which an Insolvency Event occurs with respect to the Depositor or the
Administrator, (c) the first date on which amounts on deposit in the Pre-Funding
Account is zero, after giving effect to the purchase of Subsequent Student Loans
and related transfers of funds pursuant to Section 8.10 hereof, and (d) July 30,
2004.
"FUTURE DISTRIBUTION ACCOUNT" means the account designated as
such, established and maintained pursuant to Section 8.02(a)(iv) of the
Indenture.
"GLOBAL NOTE" means any Note registered in the name of the
Depository or its nominee, beneficial interests of which are reflected on the
books of the Depository or on the books of a Person maintaining any account with
such Depository (directly or as an indirect participant in accordance with the
rules of such Depository). The Global Note shall include the Rule 144A Global
Notes and the Regulation S Global Notes.
"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.
"GRANTOR TRUSTEE" means U.S. Bank National Association, not in
its individual capacity but solely as Grantor Trustee under the Grantor Trust
Agreement.
"GRANTOR TRUST AGREEMENT" means the Grantor Trust Agreement
dated as of June 10, 2004 between the Depositor and the Grantor Trustee.
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"GUARANTEE" means with respect to a Student Loan, the
insurance or guarantee of the Guarantee Agency pursuant to such Guarantee
Agency's Guarantee Agreement.
"GUARANTEE AGENCY" means XXXX.
"GUARANTEE AGREEMENTS" means the XXXX Guarantee Agreements.
"GUARANTEE PAYMENT" means any payment made by the Guarantee
Agency pursuant to the Guarantee Agreement in respect of a Financed Student
Loan.
"INDENTURE" means the Indenture dated as of June 1, 2004,
between the Issuer and the Indenture Trustee.
"INDENTURE TRUSTEE" means U.S. Bank National Association, not
in its individual capacity but solely as Indenture Trustee under the Indenture.
"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 of the Noteholders (including
all property and interests granted to the Indenture Trustee), including all
proceeds thereof.
"INDEPENDENT" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Depositor, the Administrator 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 Issuer, any such other obligor,
the Depositor, the Administrator or any Affiliate of any of the foregoing
Persons and (c) is not connected with the Issuer, any such other obligor, the
Depositor, the Administrator or any Affiliate of any of the foregoing Persons as
an officer, employee, promoter, underwriter, trustee, partner, director or
person performing similar functions. Whenever it is herein provided that any
Independent Person's Opinion of Counsel or certificate shall be furnished to the
Indenture Trustee, such Person shall be appointed by the Issuer or the Indenture
Trustee, as the case may be, and such Opinion of Counsel or certificate shall
state that the signer has read this definition and that the signer is
Independent within the meaning hereof.
"INDEX MATURITY" means, (i) for One-Month LIBOR, one month,
(ii) for Three-Month LIBOR, three months, (iii) for Five-Month LIBOR, five
months, (iv) for Six-Month LIBOR, six months and (v) for One-Year LIBOR, one
year.
"INDIRECT PARTICIPANT" means any financial institution for
whom any Participant holds an interest in any Note.
"INDIVIDUAL NOTE" means any Note registered in the name of a
holder other than the Depository or its nominee.
"INITIAL FINANCED STUDENT LOANS" means the Student Loans
identified as such in each of the pool supplements dated as of the Closing Date
between the Trust and a Seller, transferred to the Trust as of the Closing Date
and listed on the Schedule of Initial Financed
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Student Loans on the Closing Date as set forth in Schedule A to the Indenture
(which Schedule may be in the form of microfiche or computer disk or tape).
"INITIAL PURCHASERS" means UBS Securities LLC and Newport
Funding Corp.
"INSIDER" means, with respect to an entity, any officer,
director or person privy to material information, including, but not limited to,
contracts or agreements concerning such entity that are not available to the
general public.
"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, and such decree
or order shall remain 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 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 COLLECTIONS" shall have the meaning specified in
Section 8.07 of the Indenture.
"INTEREST PERIOD" means, with respect to a Distribution Date
for a Class of Notes, the period from and including the Closing Date or the most
recent Distribution Date for that Class of Notes on which interest on the Notes
has been distributed to but excluding the current Distribution Date.
"INTEREST RATE CHANGE DATE" means for each Interest Period for
the Class A-1, A-2, A-3 and A-4 Notes, the date or dates, based on the
Applicable Index, on which the rate of interest for such Class of Notes is to be
reset.
"INTEREST RATE DETERMINATION DATE" means, for each Interest
Period for the Class A-1, A-2, A-3 and A-4 Notes, the related LIBOR
Determination Date.
"INTERESTED NOTEHOLDERS" means the Senior Noteholders (until
such time as all Senior Notes have been paid in full, and then the Subordinate
Noteholders). Notwithstanding the foregoing, any Notes owned by the
Administrator, the Depositor or any of their respective Affiliates or agents
designated for such purpose, shall be not voted by such entity nor considered in
determining any specified voting percentage of the Interested Noteholders,
unless otherwise set forth in the Indenture. The Class A-IO Notes shall not be
entitled to any voting rights on matters to be decided by the Interested
Noteholders.
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"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 8.02(b) of the Indenture.
"IRISH PAYING AGENT" means Deutsche International Corporate
Services (Ireland) Limited, and its successors and assigns, and any other entity
serving in such capacity.
"ISSUER" means The National Collegiate Student Loan Trust
2004-1 until a successor replaces it and, thereafter, means the successor.
"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 the London interbank offered rate for deposits
in U.S. dollars for a specified maturity.
"LIBOR DETERMINATION DATE" means, with respect to each
Interest Period for the Class A-1, A-2, A-3 and A-4 Notes, the second Business
Day prior to the commencement of such Interest Period. For purposes of this
definition, a "Business Day" is any day on which banks in London and New York
City are open for the transaction of business.
"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 Financed Student Loan by operation of law as a
result of any act or omission by the related Obligor.
"LIQUIDATED STUDENT LOAN" means any defaulted Financed Student
Loan, liquidated by the Servicers have, after using all reasonable efforts to
realize upon such Financed Student Loan, determined to charge off.
"LIQUIDATION PROCEEDS" means, with respect to any Liquidated
Student Loan, the moneys collected in respect thereof from whatever source,
other than Recoveries or Guarantee Payments received, net of the sum of any
amounts expended by the Servicers in connection with such liquidation and any
amounts required by law to be remitted to the borrower on such Liquidated
Student Loan.
"MONTHLY ALLOCATION DATE" means the 25th calendar day of each
month other than the month in which a Quarterly Distribution occurs, or if such
day is not a Business Day, the immediately following Business Day.
"MONTHLY SERVICING PAYMENT DATE" means the 25th calendar day
of each month, or, if such day is not a Business Day, the immediately following
Business Day, commencing in June 2004.
"MOODY'S" means Xxxxx'x Investors Service, Inc., and its
successors and assigns.
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"NOTE DEPOSITORY AGREEMENT" means the agreement dated as of
June 9, 2004 relating to the Notes, among the Issuer, the Indenture Trustee and
The Depository Trust Company, as the initial Clearing Agency.
"NOTE INTEREST RATE" means, with respect to any Interest
Period, (1) in the case of each of the Class A Notes, other than the Class A-IO
Notes, the interest rate per annum equal to the sum of (x) the Applicable Index
plus (y) the Applicable Note Margin for such Class, (2) in the case of each
Class of the Class A-IO Notes, the Applicable Note Rate and (3) in the case of
each Class of Auction Rate Notes, the interest rate established for each such
Class for each such Interest Period pursuant to the procedures described in
Appendix B to the Indenture. The interest rate per annum for the Class A Notes
(other than the Class A-IO-1 Notes) will be computed on the basis of the actual
number of days elapsed in the related Interest Period divided by 360. The
interest rate per annum for the Class A-IO-1 Notes will be computed on a 30/360
basis, meaning a year of 360 days that is comprised of 12 months consisting of
30 days each; provided, however, that the initial Interest Period for the Class
A-IO-1 Notes shall be deemed to consist of 107 days. The interest rate per annum
for the Auction Rate Notes will be computed as provided in Appendix B hereto.
"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 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 REGISTER" and "NOTE REGISTRAR" have the respective
meanings specified in Section 2.04 of the Indenture.
"NOTEHOLDERS" means each Person in whose name a Note is
registered in the Note.
"NOTEHOLDERS' INTEREST CARRYOVER SHORTFALL" means, with
respect to any Distribution Date and any Class of Notes, the excess of (i) the
sum of the related Noteholders' Interest Distribution Amount with respect to
that Class of Notes, on the preceding Distribution Date for the Class of Notes
over (ii) the amount of interest actually distributed to the holders of that
Class of Notes on such preceding Distribution Date, plus interest on the amount
of such excess interest due to the holders of that Class of Notes to the extent
permitted by law, at the then current Note Interest Rate for that Class of Notes
from such preceding Distribution Date for that Class of Notes to the current
Distribution Date for that Class of Notes.
"NOTEHOLDERS' INTEREST DISTRIBUTION AMOUNT" means, with
respect to any Distribution Date and any Class of Notes, the sum of (i) the
aggregate amount of interest accrued at the applicable Note Interest Rate for
the related Interest Period on the outstanding principal balance or outstanding
Notional Amount, as applicable, of such Class of Notes on the immediately
preceding Distribution Date for that Class of Notes after giving effect to all
principal distributions, or Notional Amount allocations, as applicable, to such
Noteholders of such Class on such date (or, in the case of the first
Distribution Date, on the Closing Date) and (ii) the Noteholders' Interest
Carryover Shortfall for such Class and such Distribution Date.
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"NOTEHOLDERS' PRINCIPAL DISTRIBUTION AMOUNT" means, with
respect to any Quarterly Distribution Date, the amount necessary, so that after
distributing such amount to the Notes, the ratio, expressed as a percentage, of
(a) the sum of the Pool Balance, as of the last day of the related Collection
Period, plus amounts on deposit in the Pre-Funding Account, the Reserve Account,
the Future Distribution Account and the Collection Account (excluding funds on
deposit in the XXXX Pledge Fund), in each case as of the last day of the related
Collection Period, to (b) the Outstanding Amount of the Notes (other than the
Class A-IO Notes) would equal at least 103%; PROVIDED, HOWEVER, that the
Noteholders' Principal Distribution Amount will not exceed the Outstanding
Amount of the Notes (other than the Class A-IO Notes). In addition, (a) on the
Final Maturity Date for each related Class of Notes, the principal required to
be distributed to such Class of Notes will include the amount required to reduce
the outstanding principal balance of such Class of Notes to zero.
"NOTES" means collectively, the Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes, the Class A-4 Notes, the Class A-IO-1 Notes, the
Class A-IO-2 Notes, the Class B-1 Notes, and the Class B-2 Notes.
"NOTIONAL AMOUNT" means, for each of the Class A-IO-1 Notes
and the Class A-IO-2 Notes, the amount on which the interest accrued on each
such Class of Notes is computed and, as of any date, shall equal the then
outstanding principal balance of the Class A-4 Notes; PROVIDED, HOWEVER, that
after the Quarterly Distribution Date in June 2010, the Notional Amount of the
Class A-IO-1 Notes shall equal $0.
"OBLIGOR" on a Financed Student Loan means the borrower or
co-borrowers of such Financed Student Loan and any other Person who owes
payments in respect of such Financed Student Loan, including the Guarantee
Agency thereof.
"OFFICERS' CERTIFICATE" means, with respect to the Issuer or
the Administrator, a certificate signed by one of its Authorized Officers.
"ONE-MONTH LIBOR," "THREE-MONTH LIBOR," "FIVE-MONTH LIBOR,"
"FOUR-MONTH LIBOR," "SIX-MONTH LIBOR" and "ONE-YEAR LIBOR" means, with respect
to any Interest 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 such LIBOR Determination Date. If such 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 such LIBOR Determination Date to prime
banks in the London interbank market by the Reference Banks. The Administrator
will request the principal London office of each of such Reference Banks to
provide a quotation of its rate. If at least two such quotations are provided,
the rate for that day will be the arithmetic mean of the quotations. If fewer
than two quotations are provided, 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 City time, on such 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;
provided that if the banks selected as aforesaid are not quoting as mentioned in
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this sentence, LIBOR in effect for the applicable Interest Period for the
applicable Index Maturity will be LIBOR in effect for the previous Interest
Period for that Index Maturity.
"ONE-YEAR LIBOR" see "One-Month LIBOR" herein.
"OPINION OF COUNSEL" means a written opinion of an attorney at
law or firm of attorneys selected by the Person obliged to deliver an opinion on
the subject in question, reasonably acceptable to the Person who is to receive
the same hereunder, duly admitted to the practice of law before the highest
court of any state of the United States of America or the District of Columbia.
"OPTIONAL DEPOSIT" has the meaning specified in Section
8.11(a) of the Indenture.
"ORIGINAL PRINCIPAL BALANCE" means, for any Class of Notes,
the original principal balance (or, in the case of the Class A-IO-1 and Class
A-IO-2 Notes, the original Notional Amount) for such Class on the Closing Date,
as set forth in Section 2.02 of the Indenture.
"OUTSTANDING" means, as of the date of determination, all
Notes theretofore authenticated and delivered under the Indenture except:
(i) Notes theretofore canceled by the Note
Registrar or delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment
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;
(iii) 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 Issuer, any other obligor upon the Notes, the
Depositor, the Administrator, the Servicer, 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 Issuer, any other obligor upon the Notes, the Depositor, the
Administrator, the Servicer, any Sub-Servicer or any Affiliate of any of the
foregoing Persons.
A-18
"OUTSTANDING AMOUNT" means the aggregate principal amount or
Notional Amount, as applicable, of all Notes (or, if the context so indicates,
one or more Classes of Notes) Outstanding at the date of determination.
"OWNER TRUSTEE" means Wachovia Trust Company, National
Association, not in its individual capacity but solely as Owner Trustee under
the Trust Agreement, and any successor thereto or assigned thereof.
"PARTICIPANT" means a Person that has an account with DTC.
"PAYING AGENT" means (i) 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 Issuer 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 Issuer and (ii) the Irish Paying Agent.
"PERSON" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"PHYSICAL PROPERTY" has the meaning assigned to such term in
the definition of "Delivery" above.
"POOL BALANCE" means, at any time, the aggregate principal
balance of the Financed Student Loans at the end of the preceding Collection
Period (including accrued interest thereon for such Collection Period to the
extent such interest will be capitalized upon commencement of repayment or
during deferment or forbearance).
"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 2.05 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.
"PRE-FUNDED AMOUNT" means, with respect to any Distribution
Date, the amounts on deposit in the Pre-Funding Account.
"PRE-FUNDING ACCOUNT" means the account designated as such,
established and maintained pursuant to Section 8.02(a)(iii) of the Indenture.
"PRIVATE NOTES" means the Class A-4, Class A-IO-1 and Class
A-IO-2 Notes.
"PROCEEDING" means any suit in equity, action at law or other
judicial or administrative proceeding.
"PROGRAM MANUALS" means the program manual attached as an
exhibit to each XXXX Guarantee Agreement together with the student loan program
guidelines of each of the Sellers which describe their credit and collection
policies for the origination, acquisition,
A-19
financing and servicing of Financed Student Loans, as amended, revised or
supplemented from time to time; PROVIDED, HOWEVER, that no such amendment,
revision or supplement shall (a) reduce in any manner the amount of, or delay
the timing of, collections of payments with respect to Financed Student Loans or
(b) reduce the underwriting standards with respect to Financed Student Loans
acquired or to be acquired by the Issuer, in each case without satisfying the
Rating Agency Condition.
"PURCHASE AMOUNT" means, as of the close of business on the
last day of a Collection Period, 100% of the amount required to prepay in full
the respective Financed Student Loan, in each case under the terms thereof
including all accrued interest thereon expected to be capitalized upon
commencement of repayment or during deferment or forbearance.
"PURCHASE PRICE" means the purchase price of each Subsequent
Student Loan in an amount not exceeding 9.8% of the aggregate principal balance
thereof as of its related Subsequent Cutoff Date. For purposes of the foregoing
calculations, the aggregate principal balance of each Financed Student Loan
includes accrued interest thereon from the date of origination to the related
Subsequent Cutoff Date, in each case expected to be capitalized upon
commencement of repayment or during deferment or forbearance.
"PURCHASED STUDENT LOAN" means a Financed Student Loan
purchased by the Servicer or repurchased by a Seller from the Issuer.
"QUALIFIED INSTITUTIONAL BUYER" has the meaning ascribed to
such term in Rule 144A under the Securities Act.
"QUARTERLY DISTRIBUTION DATE" means the 25th calendar day of
each September, December, March and June or if the 25th day is not a Business
Day, the next Business Day, commencing in September 2004.
"RATING AGENCY" means each of Xxxxx'x, S&P and Fitch. If any
such organization or successor is no longer in existence, "Rating Agency" shall
be a nationally recognized statistical rating organization or other comparable
Person designated by the Issuer, notice of which designation shall be given to
the Indenture Trustee and the Owner Trustee.
"RATING AGENCY CONDITION" means, with respect to any action,
that each Rating Agency shall have been given 10 days' prior notice thereof (or
such shorter period as shall be acceptable to the Rating Agencies) and that none
of the Rating Agencies shall have notified the Administrator, the Indenture
Trustee and the Remarketing Agents, if applicable, in writing that such action
will in and of itself result in a reduction or withdrawal of the then current
rating of the Notes, based upon the review by each such Rating Agency of payment
and default performance of the Financed Student Loans, financial information
relating to the Trust, the Trust Estate, the Guarantee Agency, the Servicers or
the Administrator, and such other information that such Rating Agency determines
to review.
"REALIZED LOSSES" means the excess of the aggregate principal
balance of any Liquidated Student Loan plus accrued but unpaid interest thereon
over the related Liquidation Proceeds to the extent allocable to principal.
A-20
"RECORD DATE" means (i) with respect to the Class A Notes, the
close of business on the Business Day immediately preceding a Distribution Date
for such Classes of Notes and (ii) with respect to the Auction Rate Notes, the
meaning set forth in Appendix B hereto.
"RECOVERIES" means, with respect to any Liquidated Student
Loan, moneys collected in respect thereof, from whatever source, during any
Collection Period following the Collection Period in which such Financed Student
Loan, became a Liquidated Student Loan, net of the sum of any amounts expended
by the Servicers (or any Sub-Servicer acting on their behalf) for the account of
any Obligor and any amounts required by law to be remitted to the Obligor.
"REFERENCE BANK" means a leading bank (i) engaged in
transactions in Eurodollar deposits in the international Eurocurrency market,
(ii) not controlling, controlled by or under common control with the
Administrator and (iii) having an established place of business in London.
"REGULATION S" means Regulation S under the Securities Act.
"REGULATION S GLOBAL NOTES" means the Private Notes sold in
offshore transactions in reliance on Regulation S and represented by one or more
Global Notes deposited with the Indenture Trustee as custodian for the
Depository.
"REGULATION S INVESTOR" means, with respect to a transferee of
a Regulation S Global Note, a transferee that acquires such Private Note
pursuant to Regulation S.
"REGULATION S TRANSFER CERTIFICATE" means a letter
substantially in the form attached to the Indenture as Exhibit G or Exhibit H.
"REHABILITATED STUDENT LOANS" means Financed Student Loan
purchased by XXXX due to a XXXX Guaranty Event, that the Trust will repurchase,
(to the extent there are Available Funds), if XXXX succeeds, after purchase, in
obtaining from the borrower three full consecutive on-time monthly payments
pursuant to the XXXX Deposit and Security Agreement, and the borrower is within
thirty days of being current on the Financed Student Loan.
"RESERVE ACCOUNT" means the account designated as such,
established and maintained pursuant to Section 8.02(a)(ii) of the Indenture.
"RESERVE ACCOUNT INITIAL DEPOSIT" means $114,130,609.
"RESPONSIBLE OFFICER" means, with respect to the Indenture
Trustee or the Owner Trustee, any officer within the Corporate Trust Office of
the Indenture Trustee or the Owner Trustee, including any Vice President,
Assistant Vice President, Secretary, Assistant Secretary, or any other officer
of the Indenture Trustee or the Owner Trustee customarily performing functions
similar to those performed by any of the above designated officers, with direct
responsibility for the administration of the Indenture (or the Trust Agreement,
as amended from time to time, as applicable to the Owner Trustee) and the other
Basic Documents on behalf of the Indenture Trustee or the Owner 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.
A-21
"RESTRICTED PERIOD" means the 40-day period prescribed by
Regulation S commencing on the later of (a) the date upon which Private Notes
are first offered to Persons other than the Initial Purchaser and any other
distributor (as such term is defined in Regulation S) of the Private Notes and
(b) the Closing Date.
"RULE 144A" means Rule 144A under the Securities Act.
"RULE 144A CERTIFICATION" means a letter substantially in the
form attached to the Indenture as Exhibit D.
"RULE 144A GLOBAL NOTES" means the Private Notes sold within
the United States to U.S. Persons, initially issued to Qualified Institutional
Buyers in the form of beneficial interests in one or more Global Notes,
deposited with the Indenture Trustee as custodian for the Depository.
"S&P" means Standard and Poor's Ratings Services, a division
of The XxXxxx-Xxxx Companies, Inc., and its successors and assigns.
"SCHEDULES OF FINANCED STUDENT LOANS" means the listing of the
Financed Student Loans set forth in Schedule A to the Indenture (which Schedule
may be in the form of microfiche or file or computer disk tape), as amended or
supplemented on each Subsequent Transfer Date to reflect the sale to the Trust
of the Subsequent Student Loans.
"SEC" means the United States Securities and Exchange
Commission.
"SECURITIES" means the Notes.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES LEGEND" means the following legend: "THIS NOTE HAS
NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES OR BLUE SKY LAW OF ANY
STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT THIS NOTE MAY BE
REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
"QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S
UNDER THE SECURITIES ACT, (3) PURSUANT TO ANOTHER EXEMPTION AVAILABLE UNDER THE
SECURITIES ACT AND IN ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS, OR
(4) PURSUANT TO A VALID REGISTRATION STATEMENT."
A-22
"SELLER" means any person authorized to sell Student Loans to
the Depositor pursuant to a Student Loan Purchase Agreement.
"SENIOR NOTEHOLDERS" means, collectively, each Person in whose
name a Senior Note is registered in the Note Register.
"SENIOR NOTES" means the Class A-1 Notes, Class A-2 Notes,
Class A-3 Notes, Class A-4 Notes, Class A-IO-1 Notes and the Class A-IO-2 Notes.
"SERVICER" means, the Pennsylvania Higher Education Assistance
Agency, Great Lakes Educational Loan Services, Inc., Nelnet, Inc. or any other
loan servicer satisfying the Rating Agency Condition.
"SERVICER DEFAULT" means any default event specified in a
Servicing Agreement.
"SERVICER'S REPORT" means any report of a Servicer (or any
Sub-Servicer acting at the direction of the Servicer) delivered pursuant to a
Servicing Agreement, substantially in the form acceptable to the Administrator.
"SERVICING AGREEMENT" means (a) the agreement by which the
Pennsylvania Higher Education Assistance Agency will act as a Servicer, dated as
of October 16, 2001, as amended, between FMC and the Pennsylvania Higher
Education Assistance Agency, which agreement will be assigned to the Trust
concurrent with the initial purchase of Financed Student Loans, (b) Non-FFELP
Loan Servicing Agreement, dated as of May 1, 2003, as amended, by and between
Great Lakes Educational Loan Services, Inc. and FMC, (c) Loan Servicing
Agreement, dated as of August 1, 2001, as amended, between Nelnet, Inc.
(formerly known as Nelnet Loan Services, Inc.) and FMC, and (d) any other
servicing agreement between the Issuer and a Servicer under which such Servicer
agrees to service Financed Student Loans included in the Trust Estate, which
servicing agreement shall satisfy the Rating Agency Condition.
"SERVICING FEE" means the fee payable to a Servicer pursuant
to a Servicing Agreement as in effect on the Closing Date, such fee may be
increased upon satisfying the Rating Agency Condition.
"SIX-MONTH LIBOR" see "One-Month LIBOR" herein.
"SPECIFIED RESERVE ACCOUNT BALANCE" means, on any Quarterly
Distribution Date beginning with the Quarterly Distribution Date in June 2005
(after giving effect to all deposits or withdrawals therefrom on that Quarterly
Distribution Date) the greater of (a) the respective amount listed below for
that Quarterly Distribution Date:
ON OR AFTER QUARTERLY DISTRIBUTION DATE AMOUNT
--------------------------------------- ------
June 2005 $95,000,000
September 2005 $80,000,000
December 2005 $70,000,000
March 2006 $60,000,000
June 2006 $50,000,000
A-23
September 2006 $40,000,000
December 2006 $30,000,000
March 2007 $25,000,000
June 2007 $20,000,000
September 2007 $15,000,000
December 2007 $10,000,000
March 2008 $10,000,000
June 2008 $ 5,000,000
September 2008 and thereafter $ 1,500,000
(b) 1.25% of the Outstanding Amount of the Notes (other than
the Class A-IO Notes) as of the last day of the immediately preceding Collection
Period, and (c) $1,500,000.
"STATE" means any one of the 50 States of the United States of
America or the District of Columbia.
"STUDENT LOAN" means (a) a Credit-Worthy Cosigned Loan, (b) a
Credit-Worthy Non-Cosigned Loan, or (c) a Credit-Ready Loan.
"STUDENT LOAN ACQUISITION CERTIFICATE" means the Student Loan
Acquisition Certificate in substantially the form attached as Exhibit B to the
Indenture, as such Exhibit B may be amended or supplemented from time to time.
"STUDENT LOAN FILES" means
(a) the original fully executed copy of the note evidencing
the Financed Student Loan (including the original loan application fully
executed by the Obligor); and
(b) any and all other documents and computerized records that
the Servicer shall keep on file, in accordance with its customary procedures,
relating to such Financed Student Loan or any borrower with respect thereto.
"STUDENT LOAN PROGRAMS" means the student loan programs
sponsored by the Depositor and its Affiliates for the origination, acquisition,
holding, servicing and financing of Student Loans, which programs are governed
by the Program Manuals.
"STUDENT LOAN PURCHASE AGREEMENTS" means, collectively, the
student loan purchase agreements and any other similar agreement providing for
the sale of Student Loans from the Sellers to the Depositor for deposit into the
Trust Estate, including the pool supplement relating thereto by and among the
applicable Seller, the Depositor and FMC. On the Closing Date, the Student Loan
Purchase Agreements shall be as listed in Schedule D to the Indenture.
"SUBORDINATE NOTEHOLDERS" means, collectively, each Person in
whose name a Subordinate Note is registered in the Note Register.
"SUBORDINATE NOTES" means the Class B-1 Notes and the Class
B-2 Notes.
A-24
"SUBSEQUENT CUTOFF DATE" means the day specified in the
related Subsequent Transfer Agreement as of which principal and interest
accruing with respect to a Subsequent Student Loan is to be transferred to the
Issuer.
"SUBSEQUENT STUDENT LOANS" means the Student Loans purchased
by the Trust from the Depositor, and the Depositor from the Sellers with
proceeds in the Pre-Funding Account, each Subsequent Student Loan to be
identified on Schedule B to the Indenture (which may be in the form of
microfiche or computer tape).
"SUBSEQUENT TRANSFER DATE" means each day during the Funding
Period on which Subsequent Student Loans will be conveyed to the Issuer.
"SUPPLEMENTAL INDENTURE" means any amendment of or supplement
to this Indenture made in accordance with Article IX hereof.
"TELERATE PAGE 3750" means the display page so designated on
the Bridge Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices) or such
comparable page on a comparable service.
"10% POOL BALANCE DISTRIBUTION DATE" means the Quarterly
Distribution Date on which the outstanding aggregate Pool Balance is equal to or
less than 10% of the sum of the aggregate principal balance as of the Cutoff
Date of the Initial Financed Student Loans plus the aggregate initial principal
balance of all Subsequent Student Loans.
"XXXX" means The Education Resources Institute, Inc., a
Massachusetts non-profit corporation, or its successors and assigns.
"XXXX DEPOSIT AND SECURITY AGREEMENT" means the Deposit and
Security Agreement dated as of June 10, 2004, by and among the Issuer, XXXX and
the Administrator with respect to the issuance of the Notes hereunder.
"XXXX GUARANTEE AGREEMENT" means, with a respect to a Student
Loan Program, a guarantee agreement between a Seller and XXXX, together with the
acknowledgment relating thereto among the Seller, XXXX and the Issuer. On the
Issue Date, the XXXX Guarantee Agreements shall be as listed on Schedule C to
the Indenture.
"XXXX GUARANTY AMOUNT" means, pursuant to the XXXX Guaranty
Agreements, Financed Student Loans are guaranteed 100% as to payment of
principal and interest.
"XXXX GUARANTY EVENT" means a claim for payment on a Financed
Student Loan made under the XXXX Guaranty Agreements if (a) the Obligor has
failed to make monthly principal and/or interest payments on such loan when due,
provided such failure continues for a period of 150 consecutive days, (b) the
Obligor has filed a Chapter 13 petition in a bankruptcy or, in a Chapter 7
proceeding has filed an adversary proceeding pursuant to 11 U.S.C. ss.
523(a)(8), or (c) the Obligor has died.
A-25
"XXXX PLEDGE FUND" means the fund by the name created in the
XXXX Deposit and Security Agreement whereby XXXX will pledge a portion of its
guaranty fees to the Trust, by deposit into a special trust account with the
Indenture Trustee.
"XXXX TRIGGER EVENT" means with respect to the Financed
Student Loans on any Distribution Date, such time as the Cumulative Default Rate
exceeds 15%; PROVIDED, HOWEVER, that a XXXX Trigger Event will not have occurred
if XXXX is continuing to pay claims on Defaulted Student Loans that have met the
XXXX due diligence requirements.
"THREE-MONTH LIBOR" see "One-Month LIBOR" herein.
"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 the Issuer, established pursuant to the Trust
Agreement.
"TRUST ACCOUNT PROPERTY" means the Trust Accounts, all amounts
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 Deposits and the
Pre-Funded Amount and all proceeds of the foregoing.
"TRUST ACCOUNTS" has the meaning specified in Section 8.02(b)
of the Indenture.
"TRUST AGREEMENT" means the Trust Agreement, dated as of June
10, 2004, among the Depositor, XXXX and the Owner Trustee.
"TRUST CERTIFICATE" means the Certificate.
"TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act
of 1939, as amended from time to time.
"UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction, as amended
from time to time.
"UNDERWRITERS" means UBS Securities LLC, Deutsche Bank
Securities Inc., Citigroup Global Markets Inc. and Xxxxxxx, Xxxxx & Co.
A-26
APPENDIX B
PROVISIONS RELATING TO NOTES
BEARING INTEREST AS AN AUCTION RATE
Unless otherwise provided herein, the provisions of this Appendix B
shall apply separately to the Class B-1 Notes and Class B-2 Notes, each
constituting Auction Rate Notes ("Auction Rate Notes").
ARTICLE I
DEFINITIONS
SECTION 1.01. CERTAIN DEFINITIONS. In addition to the terms defined
elsewhere in the Indenture, the following terms shall have the following
meanings with respect to the Auction Rate Note, unless the context otherwise
requires:
"ALL HOLD RATE" on any date of determination, shall mean the Applicable
LIBOR-Based Rate less 0.25%, provided that in no event shall the applicable All
Hold Rate be greater than the Maximum Interest Rate.
"APPLICABLE AUCTION RATE" shall have the meaning set forth in Section
1.04(b) of this Appendix B.
"APPLICABLE LIBOR-BASED RATE" shall mean (a) for an Auction Period of
35 days or less, One-Month LIBOR, (b) for an Auction Period of more than 35 days
but less than 115 days, Three-Month LIBOR, (c) for an Auction Period of more
than 114 days but less than 195 days, Six-Month LIBOR, and (d) for an Auction
Period of more than 194 days, One-Year LIBOR.
"APPLICABLE NUMBER OF BUSINESS DAYS" means the greater of two Business
Days or one Business Day plus the number of Business Days by which the Auction
Date precedes the first day of the next succeeding Auction Rate Note Interest
Period.
"AUCTION" shall mean each periodic implementation of the Auction
Procedures.
"AUCTION AGENCY AGREEMENT" shall mean the Auction Agency Agreement,
dated as of June 1, 2004, among the Trustee, the Issuer and the Auction Agent,
and any similar agreement or agreements with a successor Auction Agent, in each
case as from time to time amended or supplemented.
"AUCTION AGENT" shall mean any person appointed as such pursuant to
Section 1.13 of this Appendix B.
"AUCTION AGENT FEE" shall mean the fee to be paid to the Auction Agent
for the services rendered by it under the Auction Agency Agreement and the
Broker-Dealer Agreements.
"AUCTION DATE" shall mean, for each Class of Auction Rate Notes, the
Business Day immediately preceding the first day of each Auction Rate Note
Interest Period for such Class,
B-1
other than: (a) each Auction Rate Note Interest Period commencing after the
ownership of the Auction Rate Note of such Class is no longer maintained in
book-entry form by the Depository; (b) each Auction Rate Note Interest Period
commencing after the occurrence and during the continuance of a Payment Default;
or (c) any Auction Rate Note Interest Period commencing less than the Applicable
Number of Business Days after the cure or waiver of a Payment Default.
Notwithstanding the foregoing, the Auction Date for one or more Auction Periods
may be changed pursuant to Section 1.15 of this Appendix B.
"AUCTION PERIOD" means, with respect to any Auction Rate Note, the
Auction Rate Note Interest Period applicable thereto as the same may be changed
pursuant to Section 1.15 of this Appendix B.
"AUCTION PROCEDURES" shall mean the procedures set forth in Section
1.06 of this Appendix B.
"AUCTION RATE" shall mean the rate of interest per annum on any Auction
Date that results from the implementation of the Auction Procedures, and
determined as described in Section 1.06(c)(ii) of this Appendix B.
"AUCTION RATE NOTE INITIAL INTEREST PERIOD" shall mean the period from
and including the date of delivery of the Auction Rate Notes, and ending on and
including July 15, 2004 for the for the Class B-1 Notes and July 8, 2004 for the
Class B-2 Notes.
"AUCTION RATE NOTE INTEREST PAYMENT DATE" shall mean the day after the
end of each Auction Rate Note Interest Period, except as changed as provided
herein; PROVIDED, HOWEVER, that if the duration of the Auction Rate Note
Interest Period is one year or longer, then the Auction Rate Note Interest
Payment Dates thereof shall be each January 1 and July 1 during such Auction
Rate Note Interest Period and the day following the end of such Auction Rate
Note Interest Period; and shall also mean the Final Maturity Date of any Class
of Auction Rate Notes, or if any such date is not a Business Day, the next
succeeding Business Day (but only for interest accrued through the last day of
the Auction Rate Note Interest Period next preceding such Auction Rate Note
Interest Payment Date).
"AUCTION RATE NOTE INTEREST PERIOD" shall mean (a) with respect to each
class of Auction Rate Notes, the Auction Rate Note Initial Interest Period and
unless otherwise changed as described in Section 1.15 of this Appendix B, each
successive period of generally 28 days, commencing on the first Business Day
following the applicable Auction Date for a Class of Auction Rate Note, and
ending on (and including) the next applicable Auction Date for such Class of
Auction Rate Note (unless such date is not followed by a Business Day, in which
case on the next succeeding day that is followed by a Business Day) and (b) if
the Auction Periods are changed, each period commencing on an Auction Rate Note
Interest Payment Date and ending on but excluding the next succeeding Auction
Rate Note Interest Payment Date. By way of example, if an Auction Rate Note
Interest Period ordinarily would end on a Tuesday, but the following Wednesday
is not a Business Day, the Auction Rate Note Interest Period will end on that
Wednesday and the new Auction Rate Note Interest Period will begin on Thursday.
"AUCTION RATE NOTES" shall mean the Class B-1 Notes and Class B-2
Notes.
B-2
"AUTHORIZED DENOMINATION" shall mean $50,000 and any integral multiple
thereof.
"AVAILABLE AUCTION RATE NOTE" shall have the meaning set forth in
Section 1.06(c)(i)(A) of this Appendix B.
"BID" shall have the meaning set forth in Section 1.06(a)(i) of this
Appendix B.
"BIDDER" shall have the meaning set forth in Section 1.06(a)(i) of this
Appendix B.
"BROKER-DEALER" shall mean UBS Financial Services Inc. and Deutsche
Bank Securities Inc. or any other broker or dealer (each as defined in the
Securities Exchange Act), commercial bank or other entity permitted by law to
perform the functions required of a Broker-Dealer set forth in the Auction
Procedures that (a) is a Participant (or an affiliate of a Participant), (b) has
a capital surplus of at least $100,000,000, (c) has been selected by the
Administrator with the approval of the Market Agents (which approval shall not
be unreasonably withheld), and (d) has entered into a Broker-Dealer Agreement
that remains effective.
"BROKER-DEALER AGREEMENT" shall mean the broker-dealer agreement, dated
as of June 1, 2004, between the Auction Agent and UBS Financial Services Inc.
and the broker-dealer agreement, dated as of June 1, 2004, between the Auction
Agent and Deutsche Bank Securities Inc., and each other agreement between the
Auction Agent and a Broker-Dealer pursuant to which the Broker-Dealer agrees to
participate in Auctions as set forth in the Auction Procedures, as from time to
time amended or supplemented.
"BROKER-DEALER FEE" shall mean the fee to be paid to a Broker-Dealer
for the services rendered by a Broker-Dealer under a Broker-Dealer Agreement.
"BROKER-DEALER FEE RATE" on any Auction Date, shall mean the rate per
annum at which the service charge to be paid to a Broker-Dealer for the services
rendered by it with respect to such Auction Date accrues, as provided in the
Auction Agency Agreement and Broker-Dealer Agreement.
"CARRY-OVER AMOUNT" shall mean the excess, if any, of (a) the amount of
interest on a Class of Auction Rate Note that would have accrued with respect to
the related Auction Period at the Auction Rate (if an Auction is not held for
any reason, the Auction Rate shall be deemed to be the Maximum Auction Rate for
purposes of this definition) over (b) the amount of interest on such Class of
Auction Rate Note with respect to such Class of Auction Rate Note, with respect
to such Auction Period based on the Maximum Rate, together with the unpaid
portion of any such excess from prior Auction Periods; provided that any
reference to "principal" or "interest" in the Indenture, and in the Auction Rate
Notes shall not include within the meanings of such words any Carry-over Amount
or any interest accrued on any Carry-over Amount.
"DEFAULT RATE" on any date of determination shall mean the interest
rate per annum equal to the lesser of (a) the Maximum Auction Rate or (b) the
Maximum Interest Rate, rounded to the nearest one-thousandth (0.001) of 1%.
"EXISTING OWNER" shall mean, (a) with respect to and for the purpose of
dealing with the Auction Agent in connection with an Auction, a Person who is a
Broker-Dealer listed in the
B-3
existing owner registry at the close of business on the Business Day immediately
preceding the Auction Date for such Auction and (b) with respect to and for the
purpose of dealing with a Broker-Dealer in connection with an Auction, a Person
who is a beneficial owner of Auction Rate Note.
"HOLD ORDER" shall have the meaning set forth in Section 1.06(a)(i) of
this Appendix B.
"INTEREST AMOUNT" shall mean the amount of interest distributable in
respect of each Auction Rate Note for any Auction Rate Note Interest Period or
part thereof, as calculated in accordance with Section 1.10 of this Appendix B.
"LIBOR DETERMINATION DATE" shall mean, with respect to an Auction Rate
Note, the Auction Date, or if no Auction Date is applicable, the Business Day
immediately preceding the first day of each Auction Rate Note Interest Period.
"MARKET AGENT" shall mean the market agent or market agents appointed
pursuant to Section 1.12 of this Appendix B, and its or their successors or
assigns.
"MARKET AGENT AGREEMENT" shall mean each Market Agent Agreement, dated
as of June 1, 2004, between the Issuer and the initial Market Agents, and any
similar agreement with a successor Market Agent, in each case as from time to
time amended or supplemented.
"MAXIMUM AUCTION RATE" shall mean either (a) the Applicable LIBOR-Based
Rate plus 1.50% (if the ratings assigned by the Rating Agencies to the Auction
Rate Note are "Aa3" and "AA-" or better, respectively), (b) the Applicable
LIBOR-Based Rate plus 2.50% (if any one of the ratings assigned by the Rating
Agencies to the Auction Rate Note is less than "Aa3" or "AA-", respectively, but
each such rating is at least any category of "A"), or (c) the Applicable
LIBOR-Based Rate plus 3.50% (if any one of the ratings assigned by the Rating
Agencies to the Auction Rate Note is less than the lowest category of "A"). For
purposes of the Auction Agent and the Auction Procedures, the ratings referred
to in this definition shall be the last ratings of which the Auction Agent has
been given notice pursuant to the Auction Agent Agreement. The percentage amount
to be added to the Applicable LIBOR-Based Rate in any one or more of clause (a),
(b) and (c) above may be increased upon satisfying the Rating Agency Condition.
"MAXIMUM INTEREST RATE" shall mean the lesser of (a) 17% per annum or
such higher rate as may be permitted upon satisfying the Rating Agency Condition
or (b) the maximum rate of interest permitted under the laws of the State of
Delaware.
"MAXIMUM RATE" on any date of determination, shall mean the interest
rate per annum equal to the lesser of:
(a) the Maximum Auction Rate; or
(b) the Maximum Interest Rate,
in each case rounded to the nearest one-thousandth (0.001) of 1%.
B-4
"ONE-MONTH LIBOR", "THREE-MONTH LIBOR", "SIX-MONTH LIBOR" or "ONE-YEAR
LIBOR" shall mean, with respect to the Auction Rate Notes, the offered rate, as
determined by the Auction Agent, of the Applicable LIBOR-Based Rate for United
States dollar deposits which appears on Telerate Page 3750, as reported by
Bloomberg Financial Markets Commodities News (or such other page as may replace
Telerate Page 3750 for the purpose of displaying comparable rates) as of
approximately 11:00 a.m. London time, on the LIBOR Determination Date; provided,
that if on any calculation date, no rate appears on Telerate Page 3750 as
specified above, the Auction Agent shall determine the arithmetic mean of the
offered quotations for four major banks in the London interbank market, for
deposits in U.S. dollars for the respective period specified above for the banks
in the London interbank market as of approximately 11:00 a.m., London time, on
such calculation date and in a principal amount of not less than $1,000,000 that
is representative of a single transaction in such market and at such time,
unless fewer than two such quotations are provided, in which case, the
Applicable LIBOR-Based Rate shall be the arithmetic mean of the offered
quotations that leading banks in New York City selected by the Auction Agent are
quoting on the relevant LIBOR Determination Date for loans in U.S. dollars to
leading European banks in a principal amount of not less than $1,000,000 that is
representative of a single transaction in such market at such time. All
percentages resulting from such calculations shall be rounded upwards, if
necessary, to the nearest one hundredth of one percent.
"ORDER" shall have the meaning set forth in Section 1.06(a) of this
Appendix B.
"OWNER" as used in this Appendix B shall mean the beneficial owner of
any Auction Rate Notes.
"PARTICIPANT" shall mean a member of or participant in, the Depository.
"PAYMENT DEFAULT" shall mean failure to make payment of interest on,
premium, if any, and principal of an Auction Rate Note when due, by the Issuer.
"PERSON" means and includes, unless otherwise specified, an individual,
corporation, company, trust, estate, partnership or association.
"POTENTIAL OWNER" shall mean any Person (including any Existing Owner
that is (a) a Broker-Dealer when dealing with the Auction Agent and (b) a
potential beneficial owner when dealing with a Broker-Dealer), who may be
interested in acquiring Auction Rate Notes (or, in the case of an Existing Owner
thereof, an additional principal amount of Auction Rate Notes).
"RECORD DATE" shall mean (a) if, and for so long as, Auction Rate Note
Interest Payment Dates are specified to occur at the end of each Auction Period,
as provided in Section 1.15 of this Appendix B, the Applicable Number of
Business Days immediately preceding each Auction Rate Note Interest Payment Date
and (b) if and for so long as interest is payable with respect thereto
semiannually, one Business Day prior to each Auction Rate Note Interest Payment
Date.
"REGISTRAR" shall mean the Trustee or any separate registrar appointed
under the Indenture with respect to the Auction Rate Note.
"SEC" shall mean the Securities and Exchange Commission.
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"SECURITIES EXCHANGE ACT" shall mean the Securities Exchange Act of
1934, as amended.
"SELL ORDER" shall have the meaning set forth in Section 1.06(a) of
this Appendix B.
"SERVICING FEES" means any fees payable by the Issuer to a Servicer in
respect of Financed Student Loans pursuant to the provisions of a Servicing
Agreement.
"SUBMISSION DEADLINE" shall mean 1:00 p.m., New York time, on any
Auction Date or such other time on any Auction Date by which the Broker-Dealers
are required to submit Orders to the Auction Agent , as specified by the Auction
Agent from time to time.
"SUBMITTED BID" shall have the meaning set forth in Section 1.06(c)(i)
of this Appendix B.
"SUBMITTED HOLD ORDER" shall have the meaning set forth in Section
1.06(c)(i) of this Appendix B.
"SUBMITTED ORDER" shall have the meaning set forth in Section
1.06(c)(i) of this Appendix B.
"SUBMITTED SELL ORDER" shall have the meaning set forth in Section
1.06(c)(i) of this Appendix B.
"SUFFICIENT CLEARING BIDS" shall have the meaning set forth in Section
1.06(c)(i)(B) of this Appendix B.
"TRUSTEE" means the Indenture Trustee as defined in Appendix A to the
Indenture.
"WINNING BID RATE" shall have the meaning set forth in Section
1.06(c)(i)(C) of this Appendix B.
SECTION 1.02. DESCRIPTION OF SERIES; GLOBAL FORM; DEPOSITORY.
(a) As provided in the Indenture, Class B-1 Notes and Class
B-2 Notes shall be issued as Auction Rate Notes.
(b) Except as otherwise provided in this Section, the Auction
Rate Notes, in the form of one or more securities, shall be registered
in the name of the Depository, and ownership thereof shall be
maintained in book-entry form by the Depository for the account of the
Participants thereof. Initially, the Auction Rate Notes shall be
registered in the name of Cede & Co., as the nominee of DTC. Except as
provided in subsection (c) of this Section, the Auction Rate Notes may
be transferred, in whole but not in part, only to the Depository, or to
a successor to DTC selected or approved by the Administrator or to a
nominee of such successor Depository.
(i) Neither the Issuer, the Registrar nor any of
their respective affiliates shall have any responsibility or
obligation with respect to:
B-6
(A) the accuracy of the records of the
Depository or any Participant with respect to any
beneficial ownership interest in an Auction Rate
Note;
(B) the delivery to any Participant, any
Owner of an Auction Rate Note or any other person,
other than the Depository, of any notice with respect
to the Auction Rate Notes; or
(C) the payment to any Participant, any
Owner of an Auction Rate Note or any other person,
other than the Depository, of any amount with respect
to the principal of, premium, if any, or interest on
the Auction Rate Notes.
So long as the certificates for the Auction Rate Notes are not issued
pursuant to subsection (c) of this Section 1.02, the Issuer and the Registrar
may treat the Depository as, and deem the Depository to be, the absolute owner
of the Auction Rate Notes for all purposes whatsoever, including without
limitation:
(i) the payment of principal of, premium, if any, and
interest on the Auction Rate Notes;
(ii) giving notices of redemption and other matters
with respect to the Auction Rate Notes;
(iii) registering transfer with respect to the
Auction Rate Notes; and
(iv) the selection of Auction Rate Notes for
redemption.
(d) If at any time the Market Agent has notified the Issuer
that the Auction Rate Notes should not be maintained in book-entry form
or the Depository notifies the Issuer that it is unwilling or unable to
continue as Depository with respect to the Auction Rate Notes, or if at
any time the Depository shall no longer be registered or in good
standing under the Securities Exchange Act or other applicable statute
or regulation and a successor Depository is not appointed by the Issuer
within 90 days after the Issuer receives notice or becomes aware of
such condition, as the case may be, then this Section shall no longer
be applicable and the Issuer shall execute and the Registrar shall
authenticate and deliver certificates representing the Auction Rate
Notes as provided below. Certificates for the Auction Rate Notes issued
in exchange for a global certificate pursuant to this subsection (c)
shall be registered in such names and authorized denominations as the
Depository, pursuant to instructions from the Participants or
otherwise, shall instruct the Issuer and the Registrar. The Registrar
shall deliver such certificates representing the Auction Rate Notes to
the persons in whose names such Auction Rate Note are so registered on
the Business Day immediately preceding the first day of an Auction Rate
Note Interest Period.
SECTION 1.03. LIMITATIONS ON TRANSFER. So long as the ownership of the
Auction Rate Note is maintained in book-entry form by the Depository, an
Existing Owner may sell, transfer or otherwise dispose of its beneficial
interest in an Auction Rate Note only pursuant to a Bid or
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Sell Order placed in any Auction or to or through a Broker-Dealer; provided that
in the case of all transfers other than pursuant to Auctions such Existing
Owner, its Broker-Dealer or its Participant advises the Auction Agent of such
transfer.
SECTION 1.04. INTEREST ON AUCTION RATE NOTES.
(a) Interest on the Auction Rate Notes shall accrue for each
Auction Rate Note Interest Period and shall be payable in arrears, on
each Auction Rate Note Interest Payment Date and shall be calculated in
accordance with the provisions of Section 1.10 of this Appendix B.
(b) The rate of interest on each Class of Auction Rate Notes
for its Initial Auction Rate Note Interest Period shall be as follows:
CLASS INITIAL RATE
B-1 1.50%
B-2 1.50%
The rate of interest on an Auction Rate Note for each subsequent
Auction Rate Note Interest Period shall be the Applicable Auction Rate unless
such Auction Rate exceeds the Maximum Rate, in which case, the rate of interest
on the Auction Rate Note for such Auction Rate Note Interest Period shall be the
Maximum Rate, or unless the Maximum Rate shall actually be lower than the All
Hold Rate, in which case the rate of interest on the Auction Rate Note for such
Auction Rate Note Interest Period shall be the Maximum Rate; provided that if,
on any Auction Date, an Auction is not held for any reason, then the rate of
interest for the next succeeding Auction Rate Note Interest Period shall equal
the Maximum Rate on such Auction Date.
Notwithstanding the foregoing, if:
(i) the ownership of an Auction Rate Note is no
longer maintained in book-entry form by the Depository, the
rate of interest on such Auction Rate Note for any Auction
Rate Note Interest Period commencing after the delivery of
certificates representing Auction Rate Note pursuant to
Section 1.02(c) of this Appendix B shall equal the Maximum
Rate on the Business Day immediately preceding the first day
of such Auction Rate Note Interest Period; or
(ii) a Payment Default occurs, Auctions will be
suspended and the Applicable Auction Rate (as defined below)
for the Auction Rate Note Interest Period commencing on or
after such Payment Default and for each Auction Rate Note
Interest Period thereafter, to and including the Auction Rate
Note Interest Period, if any, during which, or commencing less
than two Business Days after, such Payment Default is cured
will equal the Default Rate.
The rate per annum at which interest is payable on an Auction Rate Note
for any Auction Rate Note Interest Period is herein referred to as the
"Applicable Auction Rate."
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Notwithstanding anything herein to the contrary, the Applicable Auction Rate
cannot exceed the Maximum Interest Rate.
(c) Notwithstanding anything herein to the contrary, if any
Auction Rate Note or portion thereof has been selected for redemption
during the next succeeding Interest Period, said Auction Rate Note or
portion thereof, will not be included in the Auction preceding such
redemption date, and said Auction Rate Note or portion thereof, will
continue to bear interest until the redemption date at the rate
established for the Interest Period prior to said Auction.
SECTION 1.05. PAYMENTS. So long as the Auction Rate Notes are
registered in the name of the Depository or the nominee thereof, payment of
interest (other than at maturity) and premium, if any, on, and of principal at
redemption of, the Auction Rate Notes shall be made to the Depository by wire
transfer provided proper wire instructions are received.
SECTION 1.06. AUCTION PROCEDURES. Auctions shall be conducted on each
Auction Date (other than the Auction Date immediately preceding (a) each Auction
Rate Note Interest Period commencing after the ownership of an Auction Rate Note
is no longer maintained in book-entry form by the Depository; (b) each Auction
Rate Note Interest Period commencing after the occurrence and during the
continuance of a Payment Default; or (c) any Auction Rate Note Interest Period
commencing less than two Business Days after the cure of a Payment Default). If,
there is an Auction Agent on such Auction Date, Auctions shall be conducted in
the following manner (such procedures to apply separately to each Class of
Auction Rate Note):
(a) SUBMISSIONS BY EXISTING OWNERS AND POTENTIAL OWNERS TO A
BROKER-DEALER.
(i) Prior to the Submission Deadline on each Auction
Date:
(A) each Existing Owner of Auction Rate
Notes may submit to a Broker-Dealer any information
as to:
(1) the principal amount of
Outstanding Auction Rate Notes, if any, held
by such Existing Owner which such Existing
Owner desires to continue to hold without
regard to the Auction Rate for the next
succeeding Auction Rate Note Interest
Period;
(2) the principal amount of
Outstanding Auction Rate Notes, if any,
which such Existing Owner offers to sell if
the Auction Rate for the next succeeding
Auction Rate Note Interest Period shall be
less than the rate per annum specified by
such Existing Owner; and/or
(3) the principal amount of
Outstanding Auction Rate Notes, if any, held
by such Existing Owner which such Existing
Owner offers to sell without regard to the
Auction Rate for the next succeeding Auction
Rate Note Interest Period; and
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(B) one or more Broker-Dealers may contact
Potential Owners to determine the principal amount of
Auction Rate Notes which each such Potential Owner
offers to purchase if the Auction Rate for the next
succeeding Auction Rate Note Interest Period shall
not be less than the rate per annum specified by such
Potential Owner.
For the purposes hereof, the communication to a Broker-Dealer of
information referred to in clause (A)(1), (A)(2), (A)(3) or (B) of this
paragraph (i) is hereinafter referred to as an "Order" and collectively as
"Orders" and each Existing Owner and each Potential Owner placing an Order is
hereinafter referred to as a "Bidder" and collectively as "Bidders;" an Order
containing the information referred to in (x) clause (A)(1) of this paragraph
(i) is hereinafter referred to as a "Hold Order" and collectively as "Hold
Orders," (y) clause (A)(2) or (B) of this paragraph (i) is hereinafter referred
to as a "Bid" and collectively as "Bids" and (z) clause (A)(3) of this paragraph
(i) is hereinafter referred to as a "Sell Order" and collectively as "Sell
Orders."
(ii) (A) Subject to the provisions of Section 1.06(b)
of this Appendix B, a Bid by an Existing Owner shall
constitute an irrevocable offer to sell:
(1) the principal amount of
Outstanding Auction Rate Notes specified in
such Bid if the Auction Rate determined as
provided in this Section 1.06 of this
Appendix B shall be less than the rate
specified in such Bid; or
(2) such principal amount or a
lesser principal amount of Outstanding
Auction Rate Notes to be determined as set
forth in Section 1.06(d)(i)(D) of this
Appendix B, if the Auction Rate determined
as provided in this Section 1.06 shall be
equal to the rate specified in such Bid; or
(3) such principal amount or a
lesser principal amount of Outstanding
Auction Rate Notes to be determined as set
forth in Section 1.06(d)(ii)(C) of this
Appendix B, if the rate specified shall be
higher than the Maximum Auction Rate and
Sufficient Clearing Bids have not been made.
(B) Subject to the provisions of Section
1.06(b) of this Appendix B, a Sell Order by an
Existing Owner shall constitute an irrevocable offer
to sell:
(1) the principal amount of
Outstanding Auction Rate Notes specified in
such Sell Order; or
(2) such principal amount or a
lesser principal amount of Outstanding
Auction Rate Notes as set forth in Section
1.06(d)(ii)(C) of this Appendix B, if
Sufficient Clearing Bids have not been made.
B-10
(C) Subject to the provisions of Section
1.06(b) of this Appendix B, a Bid by a Potential
Owner shall constitute an irrevocable offer to
purchase:
(1) the principal amount of
Outstanding Auction Rate Notes specified in
such Bid if the Auction Rate determined as
provided in this Section shall be higher
than the rate specified in such Bid; or
(2) such principal amount or a
lesser principal amount of Outstanding
Auction Rate Notes as set forth in Section
1.06(d)(i)(E) of this Appendix B, if the
Auction Rate determined as provided in this
Section shall be equal to the rate specified
in such Bid.
(b) SUBMISSIONS BY A BROKER-DEALER TO AN AUCTION AGENT.
(i) Each Broker-Dealer shall submit in writing to the
Auction Agent prior to the Submission Deadline on each Auction
Date all Orders obtained by such Broker-Dealer and shall
specify with respect to each such Order:
(A) the name of the Bidder placing such
Order;
(B) the aggregate principal amount of
Auction Rate Notes that are the subject of such
Order;
(C) to the extent that such Bidder is an
Existing Owner:
(1) the principal amount of Auction
Rate Note, if any, subject to any Hold Order
placed by such Existing Owner;
(2) the principal amount of Auction
Rate Notes, if any, subject to any Bid
placed by such Existing Owner and the rate
specified in such Bid; and
(3) the principal amount of Auction
Rate Notes, if any, subject to any Sell
Order placed by such Existing Owner; and
(D) to the extent such Bidder is a Potential
Owner, the rate and amount specified in such
Potential Owner's Bid.
(ii) If any rate specified in any Bid contains more
than three figures to the right of the decimal point, the
Auction Agent shall round such rate up to the next highest one
thousandth (.001) of 1%.
(iii) If an Order or Orders covering all Outstanding
Auction Rate Notes held by any Existing Owner is not submitted
to the Auction Agent prior to the Submission Deadline, the
Auction Agent shall deem a Hold Order to have been
B-11
submitted on behalf of such Existing Owner covering the
principal amount of Outstanding Auction Rate Notes held by
such Existing Owner and not subject to an Order submitted to
the Auction Agent.
(iv) None of the Issuer, the Trustee nor the Auction
Agent shall be responsible for any failure of a Broker-Dealer
to submit an Order to the Auction Agent on behalf of any
Existing Owner or Potential Owner.
(v) If any Existing Owner submits through a
Broker-Dealer to the Auction Agent one or more Orders covering
in the aggregate more than the principal amount of Outstanding
Auction Rate Notes held by such Existing Owner, such Orders
shall be considered valid as follows and in the following
order of priority:
(A) all Hold Orders shall be considered
valid, but only up to and including in the aggregate
the principal amount of Auction Rate Notes held by
such Existing Owner, and if the aggregate principal
amount of Auction Rate Notes subject to such Hold
Orders exceeds the aggregate principal amount of
Auction Rate Notes held by such Existing Owner, the
aggregate principal amount of Auction Rate Notes
subject to each such Hold Order shall be reduced pro
rata to cover the aggregate principal amount of
Outstanding Auction Rate Notes held by such Existing
Owner;
(B) (1) any Bid shall be considered valid up
to and including the excess of the principal amount
of Outstanding Auction Rate Notes held by such
Existing Owner over the aggregate principal amount of
Auction Rate Notes subject to any Hold Orders
referred to in clause (A) of this paragraph (v);
(2) subject to subclause (1) of this
clause (B), if more than one Bid with the
same rate is submitted on behalf of such
Existing Owner and the aggregate principal
amount of Outstanding Auction Rate Notes
subject to such Bids is greater than such
excess such Bids shall be considered valid
up to and including the amount of such
excess, and the stated amount of Auction
Rate Notes subject to each Bid with the same
rate shall be reduced pro rata to cover the
stated amount of Auction Rate Notes equal to
such excess;
(3) subject to subclause (1) and (2)
of this clause (B), if more than one Bid
with different rates is submitted on behalf
of such Existing Owner, such Bids shall be
considered valid first in the ascending
order of their respective rates until the
highest rate is reached at which such excess
exists and then at such rate up to and
including the amount of such excess; and
B-12
(4) in any such event, the aggregate
principal amount of Outstanding Auction Rate
Notes, if any, subject to Bids not valid
under this clause (B) shall be treated as
the subject of a Bid by a Potential Owner at
the rate therein specified; and
(C) all Sell Orders shall be considered
valid up to and including the excess of the principal
amount of Outstanding Auction Rate Notes held by such
Existing Owner over the aggregate principal amount of
Auction Rate Note subject to valid Hold Orders
referred to in clause (A) of this paragraph (v) and
valid Bids referred to in clause (B) of this
paragraph (v).
(vi) If more than one Bid for Auction Rate Notes is
submitted on behalf of any Potential Owner, each Bid submitted
shall be a separate Bid with the rate and principal amount
therein specified.
(vii) Any Bid or Sell Order submitted by an Existing
Owner covering an aggregate principal amount of Auction Rate
Note not equal to an Authorized Denomination therefor shall be
rejected and shall be deemed a Hold Order. Any Bid submitted
by a Potential Owner covering an aggregate principal amount of
Auction Rate Notes not equal to an Authorized Denomination
therefor shall be rejected.
(viii) Any Bid submitted by an Existing Owner or a
Potential Owner specifying a rate lower than the All Hold Rate
shall be treated as a Bid specifying the All Hold Rate and any
such Bid shall be considered as valid and shall be selected in
the ascending order of the respective rates in the Submitted
Bids.
(ix) An Existing Owner that offers to purchase an
additional Auction Rate Note is, for purposes of such offer,
treated as a Potential Owner.
(x) Any Bid specifying a rate higher than the Maximum
Interest Rate will (A) be treated as a Sell Order if submitted
by an Existing Owner and (B) not be accepted if submitted by a
Potential Owner.
(c) DETERMINATION OF SUFFICIENT CLEARING BIDS, AUCTION RATE
AND WINNING BID RATE.
(i) Not earlier than the Submission Deadline on each
Auction Date, the Auction Agent shall assemble all valid
Orders submitted or deemed submitted to it by the
Broker-Dealers (each such Order as submitted or deemed
submitted by a Broker-Dealer being hereinafter referred to
individually as a "Submitted Hold Order," a "Submitted Bid" or
a "Submitted Sell Order," as the case may be, or as a
"Submitted Order," and collectively as "Submitted Hold
Orders," "Submitted Bids" or "Submitted Sell Orders," as the
case may be, or as "Submitted Orders") and shall determine:
B-13
(A) the excess of the total principal amount
of Outstanding Auction Rate Notes over the sum of the
aggregate principal amount of Outstanding Auction
Rate Notes subject to Submitted Hold Orders (such
excess being hereinafter referred to as the
"Available Auction Rate Note"); and
(B) from such Submitted Orders whether:
(1) the aggregate principal amount
of Outstanding Auction Rate Notes subject to
Submitted Bids by Potential Owners
specifying one or more rates equal to or
lower than the Maximum Interest Rate,
exceeds or is equal to the sum of:
(2) the aggregate principal amount
of Outstanding Auction Rate Notes subject to
Submitted Bids by Existing Owners specifying
one or more rates higher than the Maximum
Interest Rate; and
(3) the aggregate principal amount
of Outstanding Auction Rate Notes subject to
Submitted Sell Orders;
(in the event such excess or such equality
exists, other than because the sum of the
principal amounts of Auction Rate Notes in
subclauses (1) and (3) above is zero because
all of the Outstanding Auction Rate Notes
are subject to Submitted Hold Orders, such
Submitted Bids in subclause (1) above being
hereinafter referred to collectively as
"Sufficient Clearing Bids"); and
(C) if Sufficient Clearing Bids have been
made, the lowest rate specified in such Submitted
Bids (which shall be the "Winning Bid Rate") such
that if:
(1) each such Submitted Bid from
Existing Owners specifying such lowest rate
and all other Submitted Bids from Existing
Owners specifying lower rates were rejected,
thus entitling such Existing Owners to
continue to hold the principal amount of
Auction Rate Notes subject to such Submitted
Bids; and
(2) each such Submitted Bid from
Potential Owners specifying such lowest rate
and all other Submitted Bids from Potential
Owners specifying lower rates were accepted;
the result would be that such Existing
Owners described in subclause (1) above
would continue to hold own an aggregate
principal amount of Outstanding Auction Rate
Notes which, when added to the aggregate
principal amount of Outstanding Auction Rate
Note to be purchased by such Potential
Owners described in
B-14
subclause (2) above, would equal not less
than the Available Auction Rate Notes.
(ii) Promptly after the Auction Agent has made the
determinations pursuant to paragraph (i) of this subsection
(c), the Auction Agent shall advise the Trustee of the Maximum
Auction Rate, the Maximum Interest Rate, the All Hold Rate,
One-Month LIBOR, the Applicable LIBOR-Based Rate, the
Carry-over Amount and any applicable interest thereon, and the
components thereof on the Auction Date and, based on such
determinations, the Auction Rate for the next succeeding
Auction Rate Note Interest Period (the "Auction Rate") as
follows:
(A) if Sufficient Clearing Bids have been
made, that the Auction Rate for the next succeeding
Auction Rate Note Interest Period shall be equal to
the Winning Bid Rate so determined;
(B) if Sufficient Clearing Bids have not
been made (other than because all of the Outstanding
Auction Rate Notes are subject to Submitted Hold
Orders), that the Auction Rate for the next
succeeding Auction Rate Note Interest Period shall be
equal to the Maximum Auction Rate; or
(C) if all Outstanding Auction Rate Notes
are subject to Submitted Hold Orders, that the
Auction Rate for the next succeeding Auction Rate
Note Interest Period shall be equal to the All Hold
Rate.
If the Auction Rate determined as set forth above exceeds the
Maximum Rate, the Applicable Auction Rate for such Auction
Rate Note Interest Period shall be equal to the Maximum Rate,
and the excess of the amount of interest on the Auction Rate
Note that would have accrued at the rate equal to the Auction
Rate over the amount of interest on such Auction Rate Note
actually accrued at the Maximum Rate will accrue as the
Carry-over Amount. The Carry-over Amount will bear interest at
a rate equal to One-Month LIBOR from the Auction Rate Note
Interest Payment Date for the Auction Rate Note Interest
Period for which the Carry-over Amount was calculated until
paid, or until extinguished. The Carry-over Amount (and
interest accrued thereon) on the Auction Rate Note will be
calculated by the Auction Agent and paid by the Trustee, if
ever, on the next occurring Auction Rate Note Interest Payment
Date, and each succeeding Auction Rate Note Interest Payment
Date until paid, for each Auction Period subsequent to the
Auction Period in which such Carry-over Amount accrued, if and
to the extent that (1) during such subsequent Auction Period,
no additional Carry-over Amount is accruing on the Auction
Rate Note, and if paid, such Carry-over Amount is paid solely
to the extent that during such Auction Period, the amount of
interest that would be payable on this note at the Maximum
Rate exceeds the amount of interest that is payable for such
Auction Period on the Auction Rate Note at the interest rate
in effect for such Auction Period and (2) moneys are available
pursuant to the terms of the Indenture in an amount sufficient
to pay all or such portion of Carry-over Amount as described
in clause (1) above. Any such
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payment obligation for Carry-over Amount is extinguished when
the related Auction Rate Note is paid at maturity or by
earlier redemption.
(d) ACCEPTANCE AND REJECTION OF SUBMITTED BIDS AND SUBMITTED
SELL ORDERS AND ALLOCATION OF AUCTION RATE NOTES.
Existing Owners shall continue to hold the principal amount of
Auction Rate Notes that are subject to Submitted Hold Orders, and,
based on the determinations made pursuant to Section 1.06(c)(i) of this
Appendix B, Submitted Bids and Submitted Sell Orders shall be accepted
or rejected and the Auction Agent shall take such other action as set
forth below:
(i) If Sufficient Clearing Bids have been made, all
Submitted Sell Orders shall be accepted and, subject to the
provisions of paragraph (iv) of this subsection (d), Submitted
Bids shall be accepted or rejected as follows in the following
order of priority and all other Submitted Bids shall be
rejected:
(A) Existing Owners' Submitted Bids
specifying any rate that is higher than the Winning
Bid Rate shall be accepted, thus requiring each such
Existing Owner to sell the aggregate principal amount
of Auction Rate Notes subject to such Submitted Bids;
(B) Existing Owners' Submitted Bids
specifying any rate that is lower than the Winning
Bid Rate shall be rejected, thus entitling each such
Existing Owner to continue to hold the aggregate
principal amount of Auction Rate Notes subject to
such Submitted Bids;
(C) Potential Owners' Submitted Bids
specifying any rate that is lower than the Winning
Bid Rate shall be accepted, thus requiring such
Potential Owner to purchase the aggregate principal
amount of Auction Rate Notes subject to such
Submitted Bids;
(D) Each Existing Owners' Submitted Bid
specifying a rate that is equal to the Winning Bid
Rate shall be rejected, thus entitling such Existing
Owner to continue to hold the aggregate principal
amount of Auction Rate Notes subject to such
Submitted Bid, unless the aggregate principal amount
of Outstanding Auction Rate Notes subject to all such
Submitted Bids shall be greater than the principal
amount of Auction Rate Note (the "remaining principal
amount") equal to the excess of the Available Auction
Rate Notes over the aggregate principal amount of
Auction Rate Notes subject to Submitted Bids
described in clauses (B) and (C) of this paragraph
(i), in which event such Submitted Bid of such
Existing Owner shall be rejected in part, and such
Existing Owner shall be entitled to continue to hold
the principal amount of Auction Rate Notes subject to
such Submitted Bid, but only in an amount equal to
the aggregate principal amount of Auction Rate Notes
obtained by multiplying the remaining principal
amount by a fraction, the numerator of
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which shall be the principal amount of Outstanding
Auction Rate Notes held by such Existing Owner
subject to such Submitted Bid and the denominator of
which shall be the sum of the principal amount of
Outstanding Auction Rate Notes subject to such
Submitted Bids made by all such Existing Owners that
specified a rate equal to the Winning Bid Rate; and
(E) Each Potential Owner's Submitted Bid
specifying a rate that is equal to the Winning Bid
Rate shall be accepted, but only in an amount equal
to the principal amount of Auction Rate Notes
obtained by multiplying the excess of the aggregate
principal amount of Available Auction Rate Note over
the aggregate principal amount of Auction Rate Note
subject to Submitted Bids described in clauses (B),
(C) and (D) of this paragraph (i) by a fraction the
numerator of which shall be the aggregate principal
amount of Outstanding Auction Rate Notes subject to
such Submitted Bid and the denominator of which shall
be the sum of the principal amounts of Outstanding
Auction Rate Notes subject to Submitted Bids made by
all such Potential Owners that specified a rate equal
to the Winning Bid Rate.
(ii) If Sufficient Clearing Bids have not been made
(other than because all of the Outstanding Auction Rate Note
are subject to Submitted Hold Orders), subject to the
provisions of paragraph (iv) of this subsection (d), Submitted
Orders shall be accepted or rejected as follows in the
following order of priority and all other Submitted Bids shall
be rejected:
(A) Existing Owners' Submitted Bids
specifying any rate that is equal to or lower than
the Maximum Auction Rate shall be rejected, thus
entitling such Existing Owners to continue to hold
the aggregate principal amount of Auction Rate Notes
subject to such Submitted Bids;
(B) Potential Owners' Submitted Bids
specifying any rate that is equal to or lower than
the Maximum Auction Rate shall be accepted, thus
requiring each Potential Owner to purchase the
aggregate principal amount of Auction Rate Notes
subject to such Submitted Bids; and
(C) Each Existing Owner's Submitted Bid
specifying any rate that is higher than the Maximum
Auction Rate and the Submitted Sell Order of each
Existing Owner shall be accepted, thus entitling each
Existing Owner that submitted any such Submitted Bid
or Submitted Sell Order to sell the Auction Rate Note
subject to such Submitted Bid or Submitted Sell
Order, but in both cases only in an amount equal to
the aggregate principal amount of Auction Rate Notes
obtained by multiplying the aggregate principal
amount of Auction Rate Note subject to Submitted Bids
described in clause (B) of this paragraph (ii) by a
fraction the numerator of which shall be the
aggregate principal amount of Outstanding Auction
Rate Notes held by such Existing Owner subject to
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such Submitted Bid or Submitted Sell Order and the
denominator of which shall be the aggregate principal
amount of Outstanding Auction Rate Notes subject to
all such Submitted Bids and Submitted Sell Orders.
(iii) If all Outstanding Auction Rate Notes are
subject to Submitted Hold Orders, all Submitted Bids shall be
rejected.
(iv) If, as a result of the procedures described in
paragraph (i) or (ii) of this subsection (d), any Existing
Owner would be entitled or required to sell, or any Potential
Owner would be entitled or required to purchase, a principal
amount of Auction Rate Notes that is not equal to an
Authorized Denomination therefor, the Auction Agent shall, in
such manner as it shall, in its sole discretion, determine,
round up or down the principal amount of Auction Rate Note to
be purchased or sold by any Existing Owner or Potential Owner
so that the principal amount of Auction Rate Notes purchased
or sold by each Existing Owner or Potential Owner shall be
equal to an Authorized Denomination, even if such allocation
results in one or more of such Potential Owners not purchasing
any Auction Rate Note.
(e) Based on the results of each Auction, the Auction Agent
shall determine the aggregate principal amount of Auction Rate Notes to
be purchased and the aggregate principal amount of Auction Rate Notes
to be sold by Potential Owners and Existing Owners on whose behalf each
Broker-Dealer submitted Bids or Sell Orders and, with respect to each
Broker-Dealer, to the extent that such aggregate principal amount of
Auction Rate Notes to be sold differs from such aggregate principal
amount of Auction Rate Note to be purchased, determine to which other
Broker-Dealer or Broker-Dealers acting for one or more purchasers such
Broker-Dealer shall deliver, or from which other Broker-Dealer or
Broker-Dealers acting for one or more sellers such Broker-Dealer shall
receive, as the case may be, Auction Rate Notes.
SECTION 1.07. CERTAIN ORDERS NOT PERMITTED. Neither the Issuer nor any
Affiliate of the Issuer may submit an Order in any Auction. The Auction Agent
shall have no duty or liability in monitoring or enforcing compliance with this
Section.
SECTION 1.08. PAYMENT DEFAULTS; AUCTION AGENT AND BROKER-DEALER FEES
AND EXPENSES.
(a) By 12:30 p.m., New York time, on the Business Day
immediately succeeding each Auction Rate Note Interest Payment Date,
the Trustee will determine if a Payment Default has occurred. If a
Payment Default has occurred, the Trustee will notify the Auction Agent
and the Broker-Dealers by 1:00 p.m., New York time, of such Payment
Default. If a Payment Default has been cured, the Trustee shall so
notify the Auction Agent and the Broker-Dealers by 5:00 p.m., New York
time, on the day such Payment Default is cured. So long as the
ownership of the Auction
B-18
Rate Notes is maintained in book-entry form by the Depository, upon the
occurrence of a Payment Default the Trustee will immediately send a
notice thereof to the Auction Agent and Market Agent by telecopy or
similar means. So long as the ownership of the Auction Rate Notes is
maintained in book-entry form by the Depository, the Trustee will
immediately send notice to the Auction Agent by telecopy or similar
means if a Payment Default is cured.
(b) The Issuer will pay to the Auction Agent, on behalf of the
Owners of the Auction Rate Note in same day funds out of amounts in the
Collection Account, (i) an amount equal to the Auction Agent Fee as
calculated in the Auction Agency Agreement and (ii) an amount equal to
the Broker-Dealer Fee as calculated in the Broker-Dealer Agreements.
SECTION 1.09. CALCULATION OF RATES. The Auction Agent will calculate
the Carry-over Amount and any interest thereon, the Maximum Auction Rate, the
Maximum Rate, the Maximum Interest Rate, the All Hold Rate, One-Month LIBOR and
the Applicable LIBOR-Based Rate on each Auction Date. The determination by the
Auction Agent of the Maximum Auction Rate, the Maximum Rate, the Maximum
Interest Rate, the All Hold Rate, One-Month LIBOR and the Applicable LIBOR-Based
Rate will (in the absence of manifest error) be final and binding upon the
Owners and all other parties. If the ownership of an Auction Rate Note is no
longer maintained in book-entry form by the Depository, the Auction Agent will
calculate the Maximum Rate on the Business Day immediately preceding the first
day of each Auction Rate Note Interest Period commencing after the delivery of
certificates representing the Auction Rate Note pursuant to Subsection 1.02(c)
of this Appendix B. If a Payment Default shall have occurred, the Auction Agent
will calculate the Default Rate on the first day of (a) each Auction Rate Note
Interest Period commencing after the occurrence and during the continuance of
such Payment Default and (b) any Auction Rate Note Interest Period commencing
less than two Business Days after the cure of any Payment Default.
SECTION 1.10. COMPUTATION OF INTEREST. The amount of interest
distributable to Owners for any Auction Rate Note Interest Period or part
thereof for each $50,000 principal amount of Auction Rate Notes shall be
calculated by multiplying 50,000 by the Applicable Auction Rate for such Auction
Rate Note Interest Period or part thereof, multiplying such product by the
actual number of days in the Auction Rate Note Interest Period or part thereof
concerned divided by 365 or 366, as applicable, and rounding the resultant
figure to the nearest one cent. Interest on the Auction Rate Notes shall be
computed by the Trustee on the basis of a 365-day year for the number of days
actually elapsed; except that for any such calculation with respect to an
Auction Rate Note Interest Payment Date occurring after January 1 of any year
through December 31 of such year (being the leap year), such interest shall be
computed on the basis of a 366-day year period. The Trustee shall make the
calculation required in this Section not later than the close of business on
each Auction Date.
SECTION 1.11. NOTIFICATION OF RATES, AMOUNTS AND PAYMENT DATES.
(a) The Trustee shall determine the aggregate amount of
interest distributable on the next succeeding Auction Rate Note
Interest Payment Date to the Owners of the Auction Rate Note. So long
as the ownership of the Auction Rate Note is maintained in book-entry
form by the Depository, the Trustee shall advise the Depository of each
Record Date for the Auction Rate Note at least two Business Days prior
thereto.
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(b) Promptly after the date of original issuance of the
Auction Rate Notes and each Auction Rate Note Interest Payment Date,
but in any event at least 10 days prior to each Auction Rate Note
Interest Payment Date, the Trustee will:
(i) so long as no Payment Default has occurred and is
continuing and the ownership of the Auction Rate Note is
maintained in book-entry form by the Depository, acknowledge
the Auction Agent's written notification to the Trustee of (A)
the date of such next Auction Rate Note Interest Payment Date
and (B) the amount payable to the Auction Agent on each
Auction Rate Note Interest Payment Date pursuant to Section
1.08 of this Appendix B and notify the Auction Agent of any
discrepancy therein; and
(ii) advise the Depository, based on information
received from the Auction Agent, so long as the ownership of
the Auction Rate Note is maintained in book-entry form by the
Depository, of the Applicable Auction Rate and the Interest
Amount in respect of the next succeeding Auction Rate Note
Interest Period and the amount of Carry-over Amount and
interest thereon, if any.
In the event that any day that is scheduled to be an Auction
Rate Note Interest Payment Date is changed after the Trustee shall have
given the notice referred to in clause (i) above, not later than 9:15
a.m., New York time, on the Business Day next preceding the earlier of
the new Auction Rate Note Interest Payment Date or the old Auction Rate
Note Interest Payment Date, the Trustee will, by such means as the
Trustee deems practicable, give notice of such change to the Auction
Agent, so long as no Payment Default has occurred and is continuing and
the ownership of the Auction Rate Note is maintained in book-entry form
by the Depository.
SECTION 1.12. MARKET AGENT. The Market Agents shall be designated in
the Market Agent Agreements and shall serve as such under the terms and
provisions hereof and of the Market Agent Agreement. Each Market Agent,
including any successor appointed pursuant hereto, shall be a member of the
National Association of Securities Dealers, Inc. having capitalization of at
least $25,000,000, and be authorized by law to perform all the duties imposed
upon it by this Indenture and the respective Market Agent Agreement. The Market
Agents may be removed at any time by the Trustee, acting at the direction of (a)
the Administrator, or (b) the holders of 66-2/3% of the aggregate principal
amount of the Auction Rate Notes, provided that such removal shall not take
effect until the appointment of a successor Market Agent. Either Market Agent
may resign upon 30 days' written notice delivered to the Issuer and the Trustee.
The Administrator shall use its best efforts to appoint a successor Market Agent
that is a qualified institution, effective as of the effectiveness of any such
resignation or removal. The Trustee shall not be liable in any way for any
action taken, suffered, or omitted, or for any error of judgment made by the
Market Agent, whether in the performance of its duties under the Market Agent
Agreement or otherwise.
SECTION 1.13. AUCTION AGENT.
(a) The Bank of New York shall serve as the initial Auction
Agent for the Auction Rate Notes. The Trustee is hereby directed to
enter into an agreement with the
B-20
Auction Agent which shall provide as follows: The Auction Agent shall
be (i) a bank or trust company duly organized under the laws of the
United States of America or any state or territory thereof having its
principal place of business in the Borough of Manhattan, in The City of
New York, and having a combined capital stock, surplus and undivided
profits of at least $40,000,000, and (ii) a member of the National
Association of Securities Dealers, Inc., having a capitalization of at
least $40,000,000 and, in either case, authorized by law to perform all
the duties imposed upon it hereunder and under the Auction Agency
Agreement. The Auction Agent may resign and be discharged of the duties
and obligations created by the Indenture by giving at least 90 days'
written notice to the Issuer, the Trustee and the Market Agent (30
days' written notice if the Auction Agent has not been paid its fee for
more than 30 days). The Auction Agent may be removed at any time by the
Trustee if the Auction Agent is an entity other than the Trustee,
acting at the direction of (i) the Administrator or (ii) the holders of
66-2/3% of the aggregate principal amount of the Auction Rate Notes, by
an instrument signed by the Trustee and filed with the Auction Agent,
the Issuer and the Market Agent upon at least 90 days' notice; provided
that, if required by the Market Agent, an agreement in substantially
the form of the Auction Agency Agreement shall be entered into with a
successor Auction Agent. If the Auction Agent and the Trustee are the
same entity, the Auction Agent may be removed as described above, with
the Issuer acting in lieu of the Trustee.
(b) In the event that the Auction Agent resigns or is removed
or dissolved, or if the property or affairs of the Auction Agent is
taken under the control of any state or federal court or administrative
body because of bankruptcy or insolvency, or for any other reason, the
Administrator shall use its best efforts to appoint a successor as
Auction Agent, and the Trustee will thereupon enter into an Auction
Agency Agreement with such successor.
(c) The Auction Agent will act as agent for the Trustee and
the Issuer in connection with Auctions. In the absence of bad faith or
negligence on its part, the Auction Agent shall not be liable for any
action taken, suffered or omitted or for any error of judgment made by
it in the performance of its duties under the Auction Agency Agreement
and will not be liable for any error of judgment made in good faith
unless the Auction Agent shall have been negligent in ascertaining (or
failing to ascertain) the pertinent facts necessary to make such
judgment.
(d) Notwithstanding that the Auction Agent is the agent of the
Trustee hereunder and under the Auction Agency Agreement, the Trustee
will not be liable in any way for any action taken, suffered or
omitted, or for any error of judgment made by the Auction Agent,
whether in the performance of its duties under the Auction Agency
Agreement or otherwise.
SECTION 1.14. BROKER-DEALERS.
(a) The Auction Agent shall enter into a Broker-Dealer
Agreement with each of (i) UBS Financial Services Inc. with respect to
the Class B-1 Notes, and (ii) Deutsche Bank Securities Inc. with
respect to the B-2 Notes. The Market Agent may
B-21
from time to time approve one or more additional persons to serve as a
Broker-Dealer under Broker-Dealer Agreements. Any Broker-Dealer may be
removed at any time at the request of the Administrator of the Issuer,
but there shall, at all times, be at least one Broker-Dealer appointed
and acting as such.
SECTION 1.15. CHANGES IN AUCTION PERIODS OR AUCTION DATE OR AUCTION
RATE NOTE INTEREST PAYMENT DATES.
(a) Changes in Auction Period or Periods.
(i) The Market Agent:
(A) in order to conform with then-current
market practice with respect to similar securities,
shall; or
(B) in order to accommodate economic and
financial factors that may affect or be relevant to
the length of the Auction Period and the interest
rate borne by the Auction Rate Notes and with the
written consent of the Administrator of the Issuer,
may change, from time to time, the length of one or
more Auction Periods. In connection with any such
change, or otherwise, but for the same stated
purpose, the Market Agent:
(1) in order to conform with
then-current market practice with respect to
similar securities, shall; and
(2) with the written consent of the
Administrator, may change Auction Rate Note
Interest Payment Dates; any such change will
be considered a "change in the length of one
or more Auction Periods" for the purposes of
the Indenture. The Administrator shall not
consent to such change in the length of the
Auction Period, if such consent is required
above, unless he or she has received from
the Market Agent not less than three days
nor more than 25 days prior to the effective
date of such change a written request for
consent together with a certificate
demonstrating the need for change in
reliance on such factors. The Market Agent
will initiate the change in the length of
one or more Auction Periods by giving
written notice to the Trustee, the Auction
Agent, the Issuer and the Depository in
substantially the form of, or containing
substantially the information contained in,
Appendix G to the Indenture at least 10 days
prior to the Auction Date for such Auction
Period.
(ii) Any such changed Auction Period will not be less
than 7 days; furthermore, any such change in the Auction
Period shall not be more than 28 days without satisfying the
Rating Agency Condition.
(iii) The change in the length of one or more Auction
Periods shall not be allowed unless Sufficient Clearing Bids
existed at both the Auction before the
B-22
date on which the notice of the proposed change was given as
provided in this subsection (a) and the Auction immediately
preceding the proposed change.
(iv) The change in length of one or more Auction
Periods shall take effect only if (A) the Trustee and the
Auction Agent receive, by 11:00 A.M. New York time on the
Business Day before the Auction Date for the first such
Auction Period, a certificate from the Market Agent in
substantially the form attached as, or containing
substantially the same information contained in, Appendix H to
the Indenture, authorizing the change in the length of one or
more Auction Periods specified in such certificate and (B)
Sufficient Clearing Bids exist at the Auction on the Auction
Date for such first Auction Period. If the condition referred
to in clause (A) above is not met, the Applicable Auction Rate
for the next Auction Period shall be determined pursuant to
the Auction Procedures and the Auction Period shall be the
Auction Period determined without reference to the proposed
change. If the condition referred to in clause (A) is met but
the condition referred to in clause (B) above is not met, the
Applicable Auction Rate for the next Auction Period shall be
the Maximum Rate and the Auction Period shall be the Auction
Period determined without reference to the proposed change.
(b) Changes in the Auction Date. The Market Agent:
(i) in order to conform with then-current market
practice with respect to similar securities, shall; or
(ii) in order to accommodate economic and financial
factors that may affect or be relevant to the day of the week
constituting an Auction Date and the interest rate borne on an
Auction Rate Note and with the written consent of the
Administrator, may specify an earlier Auction Date (but in no
event more than five Business Days earlier) than the Auction
Date that would otherwise be determined in accordance with the
definition of "Auction Date" in Section 1.01 of this Appendix
B with respect to one or more specified Auction Periods. The
Administrator shall not consent to such change in the Auction
Date, if such consent is required in subparagraph (b)(ii)
above, unless he or she shall have received from the Market
Agent not less than three days nor more than 25 days prior to
the effective date of such change a written request for
consent together with a certificate demonstrating the need for
change in reliance on such factors. The Market Agent shall
provide notice of any determination to specify an earlier
Auction Date for one or more Auction Periods by means of a
written notice delivered at least 10 days prior to the
proposed changed Auction Date to the Trustee, the Auction
Agent, the Issuer and the Depository. Such notice shall be
substantially in the form of, or contain substantially the
information contained in, Appendix I to the Indenture.
(c) Any change described in this Section shall be made with
respect to one or more Classes of Auction Rate Notes (but in each case
separate notices shall be prepared and delivered as provided above and,
with respect to changes in the length of Auction
B-23
Periods, the conditions specified in subparagraph (a)(iv) above shall
be applied to each Class separately).
(d) In connection with any change described in this Section,
the Auction Agent shall provide notice to the parties as is specified
in Section 2.5 of the Auction Agency Agreement.
(e) No change shall be made to the Auction Period or Auction
Date unless the Issuer has satisfied the Rating Agency Condition.
SECTION 1.16. CREDIT RATINGS. The Issuer shall take all reasonable
action necessary to enable at least one nationally recognized statistical rating
organization (as that term is used in the rules and regulations of the SEC under
the Securities Exchange Act) to provide credit ratings for the Auction Rate
Notes.
SECTION 1.17. NOTICES. The Market Agent shall provide the Trustee and,
so long as no default under the Indenture has occurred and is continuing and the
ownership of the Auction Rate Notes is maintained in book-entry form by the
Depository, the Auction Agent with notice of any change in the Maximum Interest
Rate.
SECTION 1.18. PURCHASES OF AUCTION RATE NOTES. The Issuer shall not
purchase or otherwise acquire any Auction Rate Notes unless the Issuer redeems
or otherwise cancels such Auction Rate Note on the day of any purchase.
SECTION 1.19. NOTICE OF PAYMENT DEFAULT.
(a) If the Issuer determines that a Payment Default has
occurred the Issuer shall promptly notify the Trustee thereof.
(b) So long as the ownership of the Auction Rate Notes is
maintained in book-entry form by the Depository, upon the occurrence of
a Payment Default the Trustee shall immediately send a notice thereof
to the Auction Agent and Market Agent by telecopy or similar means.
(c) So long as the ownership of the Auction Rate Notes is
maintained in book-entry form by the Depository, the Trustee shall
immediately send notice to the Auction Agent by telecopy or similar
means if a Payment Default is cured.
B-24
C-1
APPENDIX C
NOTICE OF PAYMENT DEFAULT
The National Collegiate Student Loan Trust 2004-1
Student Loan Asset Backed Notes
Serves 2004-1, Class ___
NOTICE IS HEREBY GIVEN that a Payment Default currently exists with
respect to the above-captioned issue. The next Auction for the Series 2004-1,
Class ___ Notes will be held as scheduled on _______________. The rate of
interest on the Series 2004-1, Class ___ Notes for the next succeeding Auction
Period shall be determined through application of the Auction Procedures.
Dated: __________________
By ______________________________
Authorized Signatory
C-1
APPENDIX D
NOTICE OF CURE OF PAYMENT DEFAULT
The National Collegiate Student Loan Trust 2004-1
Student Loan Asset Backed Notes
Series 2004-1, Class ___
NOTICE IS HEREBY GIVEN that the Payment Default with respect to the
above-captioned issue has been cured. The next Interest Payment Date is
_______________ and the next Auction Date is scheduled to be _______________.
Dated: __________________
By __________________________________
Authorized Signatory
D-1
APPENDIX E
NOTICE OF EVENT OF DEFAULT
The National Collegiate Student Loan Trust I
Student Loan Asset Backed Notes
Series 2004-1, Class ___
NOTICE IS HEREBY GIVEN that an Event of Default with respect to the
above-captioned issue has occurred.
Dated: __________________
By __________________________________
Authorized Signatory
E-1
APPENDIX F
NOTICE OF WAIVER/CURE OF EVENT OF DEFAULT
The National Collegiate Student Loan Trust 2004-1
Student Loan Asset Backed Notes
Series 2004-1, Class ___
NOTICE IS HEREBY GIVEN that an Event of Default with respect to the
above-captioned issue has been [waived] [cured]. Determination of the interest
rate on the Series 2004-1, Class ___ Notes pursuant to the Auction Procedures
will resume. The next Interest Payment Date is _______________ and the next
Auction Date is scheduled to be __________________.
Dated: __________________
By ___________________________________
Authorized Signatory
F-1
APPENDIX G
NOTICE OF PROPOSED CHANGE IN AUCTION PERIOD
The National Collegiate Student Loan Trust 2004-1
Student Loan Asset Backed Notes
Series 2004-1, Class ___
NOTICE IS HEREBY GIVEN that The National Collegiate Student Loan Trust
2004-1 (the "Issuer") proposes to change the Auction Period in accordance with
the Indenture dated as of June 1, 2004, as supplemented (the "Indenture") as
follows: [insert description of change]. Assuming the conditions set forth in
the Indenture are met, such change will be effective on _____________. If any
such condition is not met, the Auction Rate for the next succeeding Auction
Period shall be established in accordance with the procedures set forth in the
Indenture.
All terms not otherwise defined in this notice shall have the meanings
set forth in the Indenture.
Dated: __________________
By ___________________________________
Authorized Signatory
G-1
APPENDIX H
NOTICE REGARDING ESTABLISHMENT OF AUCTION PERIOD
The National Collegiate Student Loan Trust 2004-1
Student Loan Asset Backed Notes
Series 2004-1, Class ___
NOTICE IS HEREBY GIVEN that The National Collegiate Student Loan Trust
2004-1 (the "Issuer") hereby authorizes the establishment of a new Auction
Period consisting of a period of _ days. If the condition(s) for the
establishment of the new Auction Period are met, such Auction Period will
commence on ___________________ and end on _________________. The Interest
Payment Date for such Auction Period shall be ___________________.
Capitalized terms used herein and not otherwise defined shall have the
meanings given to such terms in the Indenture of the Issuer dated as of June 1,
2004, as supplemented.
Dated: __________________
By ___________________________________
Authorized Signatory
H-1
APPENDIX I
NOTICE OF CHANGE IN AUCTION DATE
The National Collegiate Student Loan Trust 2004-1
Student Loan Asset Backed Notes
Series 2004-1, Class ___
NOTICE IS HEREBY GIVEN that the Auction Date for auctions conducted
with respect to the above-captioned issue has been changed to _______________.
The next succeeding Auction Date will be ________________. In order to
accommodate such change, the next succeeding Auction Period will consist of
_____days and shall begin on ______________ and end on ________________.
Interest will be paid on _______________.
Capitalized terms used herein and not otherwise defined shall have the
meanings given to such terms in the Indenture of the Issuer dated as of June 1,
2004, as supplemented.
Dated: __________________
[BROKER-DEALER]
By ___________________________________
Authorized Signatory
I-1
SCHEDULE A
----------
SCHEDULE OF INITIAL FINANCED STUDENT LOANS
[On file with Indenture Trustee]
Schedule A-1
SCHEDULE B
----------
SCHEDULE OF SUBSEQUENT STUDENT LOANS
[On file with Indenture Trustee]
Schedule B-1
SCHEDULE C
----------
LIST OF XXXX GUARANTEE AGREEMENTS
Each of the following Guaranty Agreements, as amended or supplemented, was
entered into by and between The Education Resources Institute, Inc. and:
o Bank of America, N.A., dated April 30, 2001, for loans that were
originated under Bank of America's BAGEL Loan Program, CEDU Loan
Program and ISLP Loan Program.
o Bank of America, N.A., dated June 30, 2003, for loans that were
originated under Bank of America's Direct to Consumer Loan Program.
o Bank One, N.A., dated May 13, 2002, for loans that were originated
under Bank One's CORPORATE ADVANTAGE Loan Program and EDUCATION ONE
Loan Program.
o Bank One, N.A., dated July 26, 2002, for loans that were originated
under Bank One's M&T REFERRAL Loan Program
o Charter One Bank, N.A., dated October 31, 2003, for loans that were
originated under Charter One's AES EducationGAIN Loan Program.
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's (AMS) TuitionPay Diploma Loan Program.
o Charter One Bank, N.A., dated July 15, 2003, for loans that were
originated under Charter One's Brazos Alternative Loan Program.
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's CFS Direct to Consumer Loan Program.
o Charter One Bank, N.A., dated June 30, 2003, for loans that were
originated under Charter One's Citibank Flexible Education Loan
Program.
o Charter One Bank, N.A., dated July 1, 2002, for loans that were
originated under Charter One's College Loan Corporation Loan Program.
o Charter One Bank, N.A., dated December 4, 2002, for loans that were
originated under Charter One's Comerica Alternative Loan Program.
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's Education Assistance Services
Alternative Loan Program.
o Charter One Bank, N.A., dated May 15, 2003, for loans that were
originated under Charter One's ESF Alternative Loan Program.
o Charter One Bank, N.A., dated September 15, 2003, for loans that were
originated under Charter One's Extra Credit II Loan Program (North
Texas Higher Education).
o Charter One Bank, N.A., dated September 20, 2003, for loans that were
originated under Charter One's M&I Alternative Loan Program.
o Charter One Bank, N.A., dated November 17, 2003, for loans that were
originated under Charter One's National Education Loan Program.
o Charter One Bank, N.A., dated May 15, 2003, for loans that were
originated under Charter One's Navy Federal Alternative Loan Program.
Schedule C-1
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's NextStudent Alternative Loan Program.
o Charter One Bank, N.A., dated March 17, 2003, for loans that were
originated under Charter One's PNC Bank Resource Loan Program.
o Charter One Bank, N.A., dated May 1, 2003, for loans that were
originated under Charter One's SAF Alternative Loan Program.
o Charter One Bank, N.A., dated September 20, 2002, for loans that were
originated under Charter One's Southwest Loan Program.
o Charter One Bank, N.A., dated May 15, 2003, for loans that were
originated under Charter One's WAMU Alternative Student Loan Program.
o Chase Manhattan Bank USA, N.A., dated September 30, 2003, for loans
that were originated under Xxxxx'x Xxxxx Extra Loan Program.
o Citizens Bank of Rhode Island, dated October 1, 2002, for loans that
were originated under Citizens Bank of Rhode Island's Pennsylvania
State University Undergraduate and Continuing Education Loan Program.
o First National Bank Northeast, dated August 1, 2001, for loans that
were originated under First National Bank Northeast's CASL
Undergraduate Loan Program.
o GMAC Bank, dated May 30, 2003, for loans that were originated under
GMAC Bank's GMAC Alternative Loan Program.
o HSBC Bank USA, N.A., dated April 17, 2002, for loans that were
originated under the HSBC Loan Program.
o The Huntington National Bank, dated May 20, 2003, for loans that were
originated under The Huntington National Bank's Huntington Education
Loan Program.
o National City Bank, dated July 26, 2002, for loans that were originated
under National City Bank's National City Loan Program.
o SunTrust Bank, dated March 1, 2002, for loans that were originated
under SunTrust Bank's SunTrust Alternative Loan Program.
Schedule C-2
SCHEDULE D
----------
LIST OF STUDENT LOAN PURCHASE AGREEMENTS
Each of the Note Purchase Agreements, as amended or supplemented, was entered
into by and between The First Marblehead Corporation and:
o Bank of America, N.A., dated April 30, 2001, for loans that were
originated under Bank of America's BAGEL Loan Program, CEDU Loan
Program and ISLP Loan Program.
o Bank of America, N.A., dated June 30, 2003, for loans that were
originated under Bank of America's Direct to Consumer Loan Program.
o Bank One, N.A., dated May 1, 2002, for loans that were originated under
Bank One's CORPORATE ADVANTAGE Loan Program and EDUCATION ONE Loan
Program.
o Bank One, N.A., dated July 26, 2002, for loans that were originated
under Bank One's M&T REFERRAL Loan Program
o Charter One Bank, N.A., dated October 31, 2003, for loans that were
originated under Charter One's AES EducationGAIN Loan Program.
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's (AMS) TuitionPay Diploma Loan Program.
o Charter One Bank, N.A., dated July 15, 2003, for loans that were
originated under Charter One's Brazos Alternative Loan Program.
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's CFS Direct to Consumer Loan Program.
o Charter One Bank, N.A., dated June 30, 2003, for loans that were
originated under Charter One's Citibank Flexible Education Loan
Program.
o Charter One Bank, N.A., dated July 1, 2002, for loans that were
originated under Charter One's College Loan Corporation Loan Program.
o Charter One Bank, N.A., dated December 4, 2002, for loans that were
originated under Charter One's Comerica Alternative Loan Program.
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's Education Assistance Services
Alternative Loan Program.
o Charter One Bank, N.A., dated May 15, 2003, for loans that were
originated under Charter One's ESF Alternative Loan Program.
o Charter One Bank, N.A., dated September 15, 2003, for loans that were
originated under Charter One's Extra Credit II Loan Program (North
Texas Higher Education).
o Charter One Bank, N.A., dated September 20, 2003, for loans that were
originated under Charter One's M&I Alternative Loan Program.
o Charter One Bank, N.A., dated November 17, 2003, for loans that were
originated under Charter One's National Education Loan Program.
o Charter One Bank, N.A., dated May 15, 2003, for loans that were
originated under Charter One's Navy Federal Alternative Loan Program.
Schedule D-1
o Charter One Bank, N.A., dated May 15, 2002, for loans that were
originated under Charter One's NextStudent Alternative Loan Program.
o Charter One Bank, N.A., dated March 17, 2003, for loans that were
originated under Charter One's PNC Bank Resource Loan Program.
o Charter One Bank, N.A., dated May 1, 2003, for loans that were
originated under Charter One's SAF Alternative Loan Program.
o Charter One Bank, N.A., dated September 20, 2002, for loans that were
originated under Charter One's Southwest Loan Program.
o Charter One Bank, N.A., dated May 15, 2003, for loans that were
originated under Charter One's WAMU Alternative Student Loan Program.
o Chase Manhattan Bank USA, N.A., dated September 30, 2003, for loans
that were originated under Xxxxx'x Xxxxx Extra Loan Program.
o Citizens Bank of Rhode Island, dated October 1, 2002, for loans that
were originated under Citizens Bank of Rhode Island's Pennsylvania
State University Undergraduate and Continuing Education Loan Program.
o First National Bank Northeast, dated August 1, 2001, for loans that
were originated under First National Bank Northeast's CASL
Undergraduate Loan Program.
o GMAC Bank, dated May 30, 2003, for loans that were originated under
GMAC Bank's GMAC Alternative Loan Program.
o HSBC Bank USA, N.A., dated April 17, 2002, for loans that were
originated under the HSBC Loan Program.
o The Huntington National Bank, dated May 20, 2003, for loans that were
originated under The Huntington National Bank's Huntington Education
Loan Program.
o National City Bank, dated November 13, 2002, for loans that were
originated under National City Bank's National City Loan Program.
o SunTrust Bank, dated March 1, 2002, for loans that were originated
under SunTrust Bank's SunTrust Alternative Loan Program.
Schedule D-2
EXHIBIT A-1
-----------
FORM OF CLASS A-1 NOTE
----------------------
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS" (WITHIN THE MEANING OF
SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE "PLAN ASSET
REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE
"CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR (II)(A) THIS NOTE IS RATED
INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE NOTE
DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA OR
SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR
84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE UNDERWRITERS, THE
SERVICERS, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, ANY PROVIDER OF CREDIT
SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A "PARTY IN INTEREST" (WITHIN THE
MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT TO SUCH PLAN.
A-1-3
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED LIBOR RATE NOTES
CLASS A-1
No. A-1-___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
Variable June 25, 2014 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
PRINCIPAL AMOUNT: **$189,000,000**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, the Principal Amount shown above in lawful money of the
United States of America on the Date of Maturity shown above, unless prepaid
prior thereto with interest thereon from the Quarterly Distribution Date next
preceding the date of authentication hereof, unless such date of authentication
is prior to the first Quarterly Distribution Date, in which case this note shall
bear interest from the Dated Date specified above or unless such date of
authentication is a Quarterly Distribution Date, in which case this note shall
bear interest from such Quarterly Distribution Date; PROVIDED, HOWEVER, that if
as shown by the records of the Indenture Trustee (defined herein) interest on
the Class A-1 Notes (defined herein) shall be in default, Class A-1 Notes issued
in lieu of such Class A-1 Notes surrendered for transfer or exchange shall bear
interest from the date to which interest has been paid in full on the Class A-1
Notes surrendered until payment of the principal hereof has been made or duly
provided for. Principal of this note is payable upon the presentation and
surrender hereof at the principal corporate trust office of U.S. Bank National
Association, as indenture trustee (the "Indenture Trustee"). Interest on this
note is payable to the Registered Owner of record as of the close of business on
the applicable record date as shown on the registration books of the Issuer
maintained by the Indenture Trustee in its capacity as bond registrar, or its
successor in such capacity, by check or draft mailed to the Registered Owner at
the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
The Issuer will pay interest on this Class A-1 Note at the rate per annum equal
to the Note Interest Rate (as defined in the Indenture) for this Note, on each
Quarterly Distribution Date until the principal of this Note is paid or made
available for payment, on the principal amount of this Note outstanding on the
preceding Distribution Date (after giving effect to all payments of principal
made on the preceding Distribution Date). Interest on this Note will accrue for
each Quarterly Distribution Date from the most recent Distribution Date on which
interest has been paid to but excluding such Quarterly Distribution Date or, if
no interest has yet been paid, from
A-1-4
the Closing Date). Such principal of and interest on this Note shall be paid in
the manner specified herein.
The principal of and interest on this Note are payable in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal of this Note.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed LIBOR Rate Notes, Class A-1 (the "Class A-1 Notes"),
issued pursuant to the Indenture, dated as of June 1, 2004, between the Issuer
and the Indenture Trustee, as indenture trustee (such indenture, as supplemented
or amended from time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class A-1 Notes. The Class
A-1 Notes, together with any additional notes issued pursuant to the Indenture
are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class A-1 Notes have been
issued and provisions made for their security and for the rights, duties and
obligations of the Issuer, the Indenture Trustee and the Registered Owners of
the Class A-1 Notes.
The Class A-1 Notes are issuable as registered notes in the denomination of
$50,000 and $1,000 integral multiple thereof. Subject to the limitations
provided in the Indenture and upon payment of any tax or governmental charge,
Class A-1 Notes may be exchanged for a like Class and aggregate principal amount
of Class A-1 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
A-1-5
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue or not, for the purpose of receiving
payment of or on account of the principal or interest and for all other
purposes, and all such payments so made to the Registered Owner or upon such
Registered Owner's order shall be valid and effectual to satisfy and discharge
the liability on this note to the extent of the sum or sums so paid, and neither
the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
A-1-6
CERTIFICATE OF AUTHENTICATION
This note is one of the Class A-1 Notes and described in the provisions of the
within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-1-7
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-1-8
EXHIBIT A-2
-----------
FORM OF CLASS A-2 NOTE
----------------------
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS" (WITHIN THE MEANING OF
SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE "PLAN ASSET
REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE
"CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR (II)(A) THIS NOTE IS RATED
INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE NOTE
DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA OR
SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR
84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE UNDERWRITERS, THE
SERVICERS, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, ANY PROVIDER OF CREDIT
SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A "PARTY IN INTEREST" (WITHIN THE
MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT TO SUCH PLAN.
A-2-1
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED LIBOR RATE NOTES
CLASS A-2
No. A-2-___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
Variable June 25, 2027 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
PRINCIPAL AMOUNT: **$342,100,000**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, the Principal Amount shown above in lawful money of the
United States of America on the Date of Maturity shown above, unless prepaid
prior thereto with interest thereon from the Quarterly Distribution Date next
preceding the date of authentication hereof, unless such date of authentication
is prior to the first Quarterly Distribution Date, in which case this note shall
bear interest from the Dated Date specified above or unless such date of
authentication is a Quarterly Distribution Date, in which case this note shall
bear interest from such Quarterly Distribution Date; PROVIDED, HOWEVER, that if
as shown by the records of the Indenture Trustee (defined herein) interest on
the Class A-2 Notes (defined herein) shall be in default, Class A-2 Notes issued
in lieu of such Class A-2 Notes surrendered for transfer or exchange shall bear
interest from the date to which interest has been paid in full on the Class A-2
Notes surrendered until payment of the principal hereof has been made or duly
provided for. Principal of this note is payable upon the presentation and
surrender hereof at the principal corporate trust office of U.S. Bank National
Association, as indenture trustee (the "Indenture Trustee"). Interest on this
note is payable to the Registered Owner of record as of the close of business on
the applicable record date as shown on the registration books of the Issuer
maintained by the Indenture Trustee in its capacity as bond registrar, or its
successor in such capacity, by check or draft mailed to the Registered Owner at
the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
The Issuer will pay interest on this Class A-2 Note at the rate per annum equal
to the Note Interest Rate (as defined in the Indenture) for this Note, on each
Quarterly Distribution Date until the principal of this Note is paid or made
available for payment, on the principal amount of this Note outstanding on the
preceding Distribution Date (after giving effect to all payments of principal
made on the preceding Distribution Date). Interest on this Note will accrue for
each Quarterly Distribution Date from the most recent Distribution Date on which
interest has been paid to but excluding such Quarterly Distribution Date or, if
no interest has yet been paid, from the Closing Date). Such principal of and
interest on this Note shall be paid in the manner specified herein.
A-2-2
The principal of and interest on this Note are payable in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal of this Note.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed LIBOR Rate Notes, Class A-2 (the "Class A-2 Notes"),
issued pursuant to the Indenture, dated as of June 1, 2004, between the Issuer
and the Indenture Trustee, as indenture trustee (such indenture, as supplemented
or amended from time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class A-2 Notes. The Class
A-2 Notes, together with any additional notes issued pursuant to the Indenture
are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class A-2 Notes have been
issued and provisions made for their security and for the rights, duties and
obligations of the Issuer, the Indenture Trustee and the Registered Owners of
the Class A-2 Notes.
The Class A-2 Notes are issuable as registered notes in the denomination of
$50,000 and $1,000 integral multiple thereof. Subject to the limitations
provided in the Indenture and upon payment of any tax or governmental charge,
Class A-2 Notes may be exchanged for a like Class and aggregate principal amount
of Class A-2 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
A-2-3
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue or not, for the purpose of receiving
payment of or on account of the principal or interest and for all other
purposes, and all such payments so made to the Registered Owner or upon such
Registered Owner's order shall be valid and effectual to satisfy and discharge
the liability on this note to the extent of the sum or sums so paid, and neither
the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Owner Trustee
By: ____________________________
Name:
Title:
Attest
______________________________
A-2-4
CERTIFICATE OF AUTHENTICATION
This note is one of the Class A-2 Notes and described in the provisions of the
within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By ____________________________
Authorized Signatory
A-2-5
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
EXHIBIT A-3
-----------
FORM OF CLASS A-3 NOTE
----------------------
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS" (WITHIN THE MEANING OF
SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE "PLAN ASSET
REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE
"CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR (II)(A) THIS NOTE IS RATED
INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE NOTE
DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA OR
SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR
84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE UNDERWRITERS, THE
SERVICERS, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, ANY PROVIDER OF CREDIT
SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A "PARTY IN INTEREST" (WITHIN THE
MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT TO SUCH PLAN.
A-3-1
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED LIBOR RATE NOTES
CLASS A-3
No. A-3-___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
Variable June 25, 2029 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
PRINCIPAL AMOUNT: **$105,000,000**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, the Principal Amount shown above in lawful money of the
United States of America on the Date of Maturity shown above, unless prepaid
prior thereto with interest thereon from the Quarterly Distribution Date next
preceding the date of authentication hereof, unless such date of authentication
is prior to the first Quarterly Distribution Date, in which case this note shall
bear interest from the Dated Date specified above or unless such date of
authentication is a Quarterly Distribution Date, in which case this note shall
bear interest from such Quarterly Distribution Date; PROVIDED, HOWEVER, that if
as shown by the records of the Indenture Trustee (defined herein) interest on
the Class A-3 Notes (defined herein) shall be in default, Class A-3 Notes issued
in lieu of such Class A-3 Notes surrendered for transfer or exchange shall bear
interest from the date to which interest has been paid in full on the Class A-3
Notes surrendered until payment of the principal hereof has been made or duly
provided for. Principal of this note is payable upon the presentation and
surrender hereof at the principal corporate trust office of U.S. Bank National
Association, as indenture trustee (the "Indenture Trustee"). Interest on this
note is payable to the Registered Owner of record as of the close of business on
the applicable record date as shown on the registration books of the Issuer
maintained by the Indenture Trustee in its capacity as bond registrar, or its
successor in such capacity, by check or draft mailed to the Registered Owner at
the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
The Issuer will pay interest on this Class A-3 Note at the rate per annum equal
to the Note Interest Rate (as defined in the Indenture) for this Note, on each
Quarterly Distribution Date until the principal of this Note is paid or made
available for payment, on the principal amount of this Note outstanding on the
preceding Distribution Date (after giving effect to all payments of principal
made on the preceding Distribution Date). Interest on this Note will accrue for
each Quarterly Distribution Date from the most recent Distribution Date on which
interest has been paid to but excluding such Quarterly Distribution Date or, if
no interest has yet been paid, from the Closing Date). Such principal of and
interest on this Note shall be paid in the manner specified herein.
A-3-2
The principal of and interest on this Note are payable in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal of this Note.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed LIBOR Rate Notes, Class A-3 (the "Class A-3 Notes"),
issued pursuant to the Indenture, dated as of June 1, 2004, between the Issuer
and the Indenture Trustee, as indenture trustee (such indenture, as supplemented
or amended from time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class A-3 Notes. The Class
A-3 Notes, together with any additional notes issued pursuant to the Indenture
are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class A-3 Notes have been
issued and provisions made for their security and for the rights, duties and
obligations of the Issuer, the Indenture Trustee and the Registered Owners of
the Class A-3 Notes.
The Class A-3 Notes are issuable as registered notes in the denomination of
$50,000 and $1,000 integral multiple thereof. Subject to the limitations
provided in the Indenture and upon payment of any tax or governmental charge,
Class A-3 Notes may be exchanged for a like Class and aggregate principal amount
of Class A-3 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
A-3-3
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue or not, for the purpose of receiving
payment of or on account of the principal or interest and for all other
purposes, and all such payments so made to the Registered Owner or upon such
Registered Owner's order shall be valid and effectual to satisfy and discharge
the liability on this note to the extent of the sum or sums so paid, and neither
the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
A-3-4
CERTIFICATE OF AUTHENTICATION
This note is one of the Class A-3 Notes and described in the provisions of the
within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-3-5
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-3-6
EXHIBIT A-4
-----------
FORM OF CLASS A-4 NOTE
----------------------
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES OR BLUE
SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT
THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO ANOTHER EXEMPTION
AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS, OR (4) PURSUANT TO A VALID REGISTRATION STATEMENT.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
[IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER
OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF THE NOTES,
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE UNITED STATES
OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.]
A-4-1
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS" (WITHIN THE MEANING OF
SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE "PLAN ASSET
REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE
"CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR (II)(A) THIS NOTE IS RATED
INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE NOTE
DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA OR
SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR
84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE UNDERWRITERS, THE
SERVICERS, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, ANY PROVIDER OF CREDIT
SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A "PARTY IN INTEREST" (WITHIN THE
MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT TO SUCH PLAN.
NO TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION OF ONE OR MORE CLASS A-4 NOTES (A
"TRANSFER") SHALL BE MADE UNLESS SIMULTANEOUSLY WITH THE TRANSFER (1) A
PROPORTIONATE AMOUNT OF CLASS A-IO-1 NOTES AND CLASS A-IO-2 NOTES ARE
TRANSFERRED SO THAT THE RATIO OF THE NOTIONAL AMOUNT OF THE CLASS A-IO-1 NOTES
SO TRANSFERRED TO THE NOTIONAL AMOUNT OF ALL CLASS A-IO-1 NOTES, THE RATIO OF
THE NOTIONAL AMOUNT OF THE CLASS A-IO-2 NOTES SO TRANSFERRED TO THE NOTIONAL
AMOUNT OF ALL CLASS A-IO-2 NOTES, AND THE RATIO OF THE PRINCIPAL AMOUNT OF THE
CLASS A-4 NOTES SO TRANSFERRED TO THE PRINCIPAL AMOUNT OF ALL CLASS A-4 NOTES
ARE EQUAL AND (2) THE TRANSFERS OF THE CLASS A-IO-1 NOTES, THE CLASS A-IO-2
NOTES AND THE CLASS A-4 NOTES REFERRED TO HEREIN ARE MADE TO THE SAME PERSON.
A-4-2
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED LIBOR RATE NOTES
CLASS A-4
No. A-4-___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
Variable June 25, 2031 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
PRINCIPAL AMOUNT: **$75,000,000**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, the Principal Amount shown above in lawful money of the
United States of America on the Date of Maturity shown above, unless prepaid
prior thereto with interest thereon from the Quarterly Distribution Date next
preceding the date of authentication hereof, unless such date of authentication
is prior to the first Quarterly Distribution Date, in which case this note shall
bear interest from the Dated Date specified above or unless such date of
authentication is a Quarterly Distribution Date, in which case this note shall
bear interest from such Quarterly Distribution Date; PROVIDED, HOWEVER, that if
as shown by the records of the Indenture Trustee (defined herein) interest on
the Class A-4 Notes (defined herein) shall be in default, Class A-4 Notes issued
in lieu of such Class A-4 Notes surrendered for transfer or exchange shall bear
interest from the date to which interest has been paid in full on the Class A-4
Notes surrendered until payment of the principal hereof has been made or duly
provided for. Principal of this note is payable upon the presentation and
surrender hereof at the principal corporate trust office of U.S. Bank National
Association, as indenture trustee (the "Indenture Trustee"). Interest on this
note is payable to the Registered Owner of record as of the close of business on
the applicable record date as shown on the registration books of the Issuer
maintained by the Indenture Trustee in its capacity as bond registrar, or its
successor in such capacity, by check or draft mailed to the Registered Owner at
the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
The Issuer will pay interest on this Class A-4 Note at the rate per annum equal
to the Note Interest Rate (as defined in the Indenture) for this Note, on each
Quarterly Distribution Date until the principal of this Note is paid or made
available for payment, on the principal amount of this Note outstanding on the
preceding Distribution Date (after giving effect to all payments of principal
made on the preceding Distribution Date). Interest on this Note will accrue for
each Quarterly Distribution Date from the most recent Distribution Date on which
interest has been paid to but excluding such Quarterly Distribution Date or, if
no interest has yet been paid, from
A-4-3
the Closing Date). Such principal of and interest on this Note shall be paid in
the manner specified herein.
The principal of and interest on this Note are payable in such coin or currency
of the United States of America as at the time of payment is legal tender for
payment of public and private debts. All payments made by the Issuer with
respect to this Note shall be applied first to interest due and payable on this
Note as provided above and then to the unpaid principal of this Note.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed LIBOR Rate Notes, Class A-4 (the "Class A-4 Notes"),
issued pursuant to the Indenture, dated as of June 1, 2004, between the Issuer
and the Indenture Trustee, as indenture trustee (such indenture, as supplemented
or amended from time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class A-4 Notes. The Class
A-4 Notes, together with any additional notes issued pursuant to the Indenture
are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class A-4 Notes have been
issued and provisions made for their security and for the rights, duties and
obligations of the Issuer, the Indenture Trustee and the Registered Owners of
the Class A-4 Notes.
The Class A-4 Notes are issuable as registered notes in the denomination of
$50,000 and $1,000 integral multiple thereof. Subject to the limitations
provided in the Indenture and upon payment of any tax or governmental charge,
Class A-4 Notes may be exchanged for a like Class and aggregate principal amount
of Class A-4 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
A-4-4
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue or not, for the purpose of receiving
payment of or on account of the principal or interest and for all other
purposes, and all such payments so made to the Registered Owner or upon such
Registered Owner's order shall be valid and effectual to satisfy and discharge
the liability on this note to the extent of the sum or sums so paid, and neither
the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
A-4-5
CERTIFICATE OF AUTHENTICATION
This note is one of the Class A-4 Notes and described in the provisions of the
within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-4-6
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE1
The following exchanges of a part of this Global Note for an interest in another
Global Note or for an Individual Note, or exchanges of a part of another Global
Note or Individual Note for an interest in this Global Note, have been made:
Principal Amount of
this Global Note
Amount of decrease in Amount of increase in following such Signature of
Principal Amount of Principal Amount of decrease authorized officer of
Date of Exchange this Global Note this Global Note (or increase) Note Registrar
---------------- ---------------- ---------------- ------------- --------------
----------------
1 This should be included only if the Note is issued in global form.
A-4-7
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-4-8
EXHIBIT A-5
-----------
FORM OF CLASS A-IO-1 NOTE
-------------------------
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES OR BLUE
SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT
THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO ANOTHER EXEMPTION
AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS, OR (4) PURSUANT TO A VALID REGISTRATION STATEMENT.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
[IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER
OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF THE NOTES,
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE UNITED STATES
OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.]
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT
A-5-1
PURCHASING THIS NOTE ON BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS"
(WITHIN THE MEANING OF SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR
REGULATIONS (THE "PLAN ASSET REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS
DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED ("ERISA")), A "PLAN" (WITHIN THE MEANING OF SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY,
WHICH IS SUBJECT TO TITLE I OF ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR
(II)(A) THIS NOTE IS RATED INVESTMENT GRADE OR BETTER AS OF THE DATE OF
PURCHASE, (B) THE PURCHASER OR HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS
PROPERLY TREATED AS INDEBTEDNESS WITHOUT SUBSTANTIAL EQUITY FEATURES FOR
PURPOSES OF THE PLAN ASSET REGULATION AND AGREES TO SO TREAT SUCH NOTE AND (C)
THE ACQUISITION AND HOLDING OF THE NOTE DO NOT RESULT IN A VIOLATION OF THE
PROHIBITED TRANSACTION RULES OF ERISA OR SECTION 4975 OF THE CODE (X) BECAUSE IT
IS COVERED BY AN APPLICABLE EXEMPTION, INCLUDING PROHIBITED TRANSACTION CLASS
EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14, OR (Y) BY REASON OF THE TRUST, THE
ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE OWNER
TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A
"PARTY IN INTEREST" (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
TO SUCH PLAN.
NO TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION OF ONE OR MORE CLASS A-IO-1 NOTES
(A "TRANSFER") SHALL BE MADE UNLESS SIMULTANEOUSLY WITH THE TRANSFER (1) A
PROPORTIONATE AMOUNT OF CLASS A-IO-2 NOTES AND CLASS A-4 NOTES ARE TRANSFERRED
SO THAT THE RATIO OF THE NOTIONAL AMOUNT OF THE CLASS A-IO-1 NOTES SO
TRANSFERRED TO THE NOTIONAL AMOUNT OF ALL CLASS A-IO-1 NOTES, THE RATIO OF THE
NOTIONAL AMOUNT OF THE CLASS A-IO-2 SO TRANSFERRED TO THE NOTIONAL AMOUNT OF ALL
CLASS A-IO-2 NOTES, AND THE RATIO OF THE PRINCIPAL AMOUNT OF THE CLASS A-4 NOTES
SO TRANSFERRED TO THE PRINCIPAL AMOUNT OF ALL CLASS A-4 NOTES ARE EQUAL AND (2)
THE TRANSFERS OF THE CLASS A-IO-1 NOTES, THE CLASS A-IO-2 AND THE CLASS A-4
NOTES REFERRED TO HEREIN ARE MADE TO THE SAME PERSON.
THIS NOTE HAS NO PRINCIPAL BALANCE AND IS NOT ENTITLED TO ANY DISTRIBUTIONS IN
RESPECT OF PRINCIPAL.
A-5-2
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED LIBOR RATE NOTES
CLASS A-IO-1
No. A-IO-1___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
7.87% June 25, 2010 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, certain monthly distributions of interest for each Quarterly
Distribution Date through and including the Date of Maturity shown above, unless
prepaid prior thereto with interest thereon from the Quarterly Distribution Date
next preceding the date of authentication hereof, unless such date of
authentication is prior to the first Quarterly Distribution Date, in which case
this note shall bear interest from the Dated Date specified above or unless such
date of authentication is a Quarterly Distribution Date, in which case this note
shall bear interest from such Quarterly Distribution Date; PROVIDED, HOWEVER,
that if as shown by the records of the Indenture Trustee (defined herein)
interest on the Class A-IO-1 Notes (defined herein) shall be in default, Class
A-IO-1 Notes issued in lieu of such Class A-IO-1 Notes surrendered for transfer
or exchange shall bear interest from the date to which interest has been paid in
full on the Class A-IO-1 Notes surrendered until the Date of Maturity shown
above. Interest on this note is payable to the Registered Owner of record as of
the close of business on the applicable record date as shown on the registration
books of the Issuer maintained by the U.S. Bank National Association, as
indenture trustee (the "Indenture Trustee") in its capacity as bond registrar,
or its successor in such capacity, by check or draft mailed to the Registered
Owner at the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
The Issuer will pay interest on this Class A-IO-1 Note at the rate per annum
equal to the Note Interest Rate (as defined in the Indenture) on each Quarterly
Distribution Date until the Date of Maturity. Interest on this Class A-IO-1 Note
will accrue for each Quarterly Distribution Date on the Notional Amount
outstanding of the Class A-IO-1 Note until such Notional Amount is reduced to
zero, from the most recent Distribution Date on which interest has been paid to
but excluding such Quarterly Distribution Date or, if no interest has yet been
paid, from the Closing Date). Such interest on this Note shall be paid in the
manner specified herein.
Interest on this Note is payable in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed LIBOR Rate Notes, Class A-IO-1 (the "Class A-IO-1
Notes"), issued pursuant to the
A-5-3
Indenture, dated as of June 1, 2004, between the Issuer and the Indenture
Trustee, as indenture trustee (such indenture, as supplemented or amended from
time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class A-IO-1 Notes. The
Class A-IO-1 Notes, together with any additional notes issued pursuant to the
Indenture are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class A-IO-1 Notes have
been issued and provisions made for their security and for the rights, duties
and obligations of the Issuer, the Indenture Trustee and the Registered Owners
of the Class A-IO-1 Notes.
The Class A-IO-1 Notes are issuable as registered notes in the denomination of
$50,000 or any integral multiple thereof. Subject to the limitations provided in
the Indenture and upon payment of any tax or governmental charge, Class A-IO-1
Notes may be exchanged for a like Class and aggregate Notional Amount of Class
A-IO-1 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue
A-5-4
or not, for the purpose of receiving payment of or on account of interest and
for all other purposes, and all such payments so made to the Registered Owner or
upon such Registered Owner's order shall be valid and effectual to satisfy and
discharge the liability on this note to the extent of the sum or sums so paid,
and neither the Issuer nor Indenture Trustee nor any Registrar shall be affected
by any notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
A-5-5
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
A-5-6
CERTIFICATE OF AUTHENTICATION
This note is one of the Class A-IO-1 Notes and described in the provisions of
the within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-5-7
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE1
The following exchanges of a part of this Global Note for an interest in another
Global Note or for an Individual Note, or exchanges of a part of another Global
Note or Individual Note for an interest in this Global Note, have been made:
Principal Amount of
this Global Note
Amount of decrease in Amount of increase in following such Signature of
Principal Amount of Principal Amount of decrease authorized officer of
Date of Exchange this Global Note this Global Note (or increase) Note Registrar
---------------- ---------------- ---------------- ------------- --------------
-------------------------
1 This should be included only if the Note is issued in global form.
A-5-8
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-5-9
EXHIBIT A-6
-----------
FORM OF CLASS A-IO-2 NOTE
-------------------------
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR UNDER ANY STATE SECURITIES OR BLUE
SKY LAW OF ANY STATE. THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT
THIS NOTE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN
COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (1)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT
THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE
MEANING OF RULE 144A (A "QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB
PURCHASING FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE,
THAT THE REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON
RULE 144A, (2) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE
904 OF REGULATION S UNDER THE SECURITIES ACT, (3) PURSUANT TO ANOTHER EXEMPTION
AVAILABLE UNDER THE SECURITIES ACT AND IN ACCORDANCE WITH ANY APPLICABLE STATE
SECURITIES LAWS, OR (4) PURSUANT TO A VALID REGISTRATION STATEMENT.
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
[IF REGULATION S GLOBAL NOTE] [THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT AND PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER
OF THE COMMENCEMENT OF THE OFFERING AND THE ORIGINAL ISSUE DATE OF THE NOTES,
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE UNITED STATES
OR TO A U.S. PERSON EXCEPT PURSUANT TO AN EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT.]
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT
A-6-1
PURCHASING THIS NOTE ON BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS"
(WITHIN THE MEANING OF SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR
REGULATIONS (THE "PLAN ASSET REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS
DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED ("ERISA")), A "PLAN" (WITHIN THE MEANING OF SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986 (THE "CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY,
WHICH IS SUBJECT TO TITLE I OF ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR
(II)(A) THIS NOTE IS RATED INVESTMENT GRADE OR BETTER AS OF THE DATE OF
PURCHASE, (B) THE PURCHASER OR HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS
PROPERLY TREATED AS INDEBTEDNESS WITHOUT SUBSTANTIAL EQUITY FEATURES FOR
PURPOSES OF THE PLAN ASSET REGULATION AND AGREES TO SO TREAT SUCH NOTE AND (C)
THE ACQUISITION AND HOLDING OF THE NOTE DO NOT RESULT IN A VIOLATION OF THE
PROHIBITED TRANSACTION RULES OF ERISA OR SECTION 4975 OF THE CODE (X) BECAUSE IT
IS COVERED BY AN APPLICABLE EXEMPTION, INCLUDING PROHIBITED TRANSACTION CLASS
EXEMPTION 96-23, 95-60, 91-38, 90-1 OR 84-14, OR (Y) BY REASON OF THE TRUST, THE
ADMINISTRATOR, THE UNDERWRITERS, THE SERVICERS, THE INDENTURE TRUSTEE, THE OWNER
TRUSTEE, ANY PROVIDER OF CREDIT SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A
"PARTY IN INTEREST" (WITHIN THE MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT
TO SUCH PLAN.
NO TRANSFER, SALE, PLEDGE OR OTHER DISPOSITION OF ONE OR MORE CLASS A-IO-2 NOTES
(A "TRANSFER") SHALL BE MADE UNLESS SIMULTANEOUSLY WITH THE TRANSFER (1) A
PROPORTIONATE AMOUNT OF CLASS A-IO-1 NOTES AND CLASS A-4 NOTES ARE TRANSFERRED
SO THAT THE RATIO OF THE NOTIONAL AMOUNT OF THE CLASS A-IO-1 NOTES SO
TRANSFERRED TO THE NOTIONAL AMOUNT OF ALL CLASS A-IO-1 NOTES, THE RATIO OF THE
NOTIONAL AMOUNT OF THE CLASS A-IO-2 SO TRANSFERRED TO THE NOTIONAL AMOUNT OF ALL
CLASS A-IO-2 NOTES, AND THE RATIO OF THE PRINCIPAL AMOUNT OF THE CLASS A-4 NOTES
SO TRANSFERRED TO THE PRINCIPAL AMOUNT OF ALL CLASS A-4 NOTES ARE EQUAL AND (2)
THE TRANSFERS OF THE CLASS A-IO-1 NOTES, THE CLASS A-IO-2 AND THE CLASS A-4
NOTES REFERRED TO HEREIN ARE MADE TO THE SAME PERSON.
THIS NOTE HAS NO PRINCIPAL BALANCE AND IS NOT ENTITLED TO ANY DISTRIBUTIONS IN
RESPECT OF PRINCIPAL.
A-6-2
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED LIBOR RATE NOTES
CLASS A-IO-2
No. A-IO-2___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
0.12% June 25, 2031 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, certain monthly distributions of interest for each Quarterly
Distribution Date through and including the Date of Maturity shown above, unless
prepaid prior thereto with interest thereon from the Quarterly Distribution Date
next preceding the date of authentication hereof, unless such date of
authentication is prior to the first Quarterly Distribution Date, in which case
this note shall bear interest from the Dated Date specified above or unless such
date of authentication is a Quarterly Distribution Date, in which case this note
shall bear interest from such Quarterly Distribution Date; PROVIDED, HOWEVER,
that if as shown by the records of the Indenture Trustee (defined herein)
interest on the Class A-IO-2 Notes (defined herein) shall be in default, Class
A-IO-2 Notes issued in lieu of such Class A-IO-2 Notes surrendered for transfer
or exchange shall bear interest from the date to which interest has been paid in
full on the Class A-IO-2 Notes surrendered until the Date of Maturity shown
above. Interest on this note is payable to the Registered Owner of record as of
the close of business on the applicable record date as shown on the registration
books of the Issuer maintained by the U.S. Bank National Association, as
indenture trustee (the "Indenture Trustee") in its capacity as bond registrar,
or its successor in such capacity, by check or draft mailed to the Registered
Owner at the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
The Issuer will pay interest on this Class A-IO-2 Note at the rate per annum
equal to the Note Interest Rate (as defined in the Indenture) on each Quarterly
Distribution Date until the Date of Maturity. Interest on this Class A-IO-2 Note
will accrue for each Quarterly Distribution Date on the Notional Amount
outstanding of the Class A-IO-2 Note until such Notional Amount is reduced to
zero, from the most recent Distribution Date on which interest has been paid to
but excluding such Quarterly Distribution Date or, if no interest has yet been
paid, from the Closing Date). Such interest on this Note shall be paid in the
manner specified herein.
Interest on this Note is payable in such coin or currency of the United States
of America as at the time of payment is legal tender for payment of public and
private debts.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed LIBOR Rate Notes, Class A-IO-2 (the "Class A-IO-2
Notes"), issued pursuant to the
A-6-3
Indenture, dated as of June 1, 2004, between the Issuer and the Indenture
Trustee, as indenture trustee (such indenture, as supplemented or amended from
time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class A-IO-2 Notes. The
Class A-IO-2 Notes, together with any additional notes issued pursuant to the
Indenture are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class A-IO-2 Notes have
been issued and provisions made for their security and for the rights, duties
and obligations of the Issuer, the Indenture Trustee and the Registered Owners
of the Class A-IO-2 Notes.
The Class A-IO-2 Notes are issuable as registered notes in the denomination of
$50,000 or any integral multiple thereof. Subject to the limitations provided in
the Indenture and upon payment of any tax or governmental charge, Class A-IO-2
Notes may be exchanged for a like Class and aggregate Notional Amount of Class
A-IO-2 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue
A-6-4
or not, for the purpose of receiving payment of or on account of interest and
for all other purposes, and all such payments so made to the Registered Owner or
upon such Registered Owner's order shall be valid and effectual to satisfy and
discharge the liability on this note to the extent of the sum or sums so paid,
and neither the Issuer nor Indenture Trustee nor any Registrar shall be affected
by any notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
A-6-5
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
A-6-6
CERTIFICATE OF AUTHENTICATION
This note is one of the Class A-IO-2 Notes and described in the provisions of
the within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-6-7
SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE1
The following exchanges of a part of this Global Note for an interest in another
Global Note or for an Individual Note, or exchanges of a part of another Global
Note or Individual Note for an interest in this Global Note, have been made:
Principal Amount of
this Global Note
Amount of decrease in Amount of increase in following such Signature of
Principal Amount of Principal Amount of decrease authorized officer of
Date of Exchange this Global Note this Global Note (or increase) Note Registrar
---------------- ---------------- ---------------- ------------- --------------
-----------------
1 This should be included only if the Note is issued in global form.
A-6-8
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-6-9
EXHIBIT A-7
-----------
FORM OF CLASS B-1 NOTE
----------------------
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS" (WITHIN THE MEANING OF
SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE "PLAN ASSET
REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE
"CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR (II)(A) THIS NOTE IS RATED
INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE NOTE
DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA OR
SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR
84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE UNDERWRITERS, THE
SERVICERS, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, ANY PROVIDER OF CREDIT
SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A "PARTY IN INTEREST" (WITHIN THE
MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT TO SUCH PLAN.
A-7-1
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED AUCTION RATE NOTES
CLASS B-1
No. B-1-___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
Variable June 1, 2039 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
PRINCIPAL AMOUNT: **$39,500,000**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, the Principal Amount shown above in lawful money of the
United States of America on the Date of Maturity shown above, unless prepaid
prior thereto with interest thereon from the Auction Rate Note Interest Payment
Date next preceding the date of authentication hereof, unless such date of
authentication is prior to the first Auction Rate Note Interest Payment Date, in
which case this note shall bear interest from the Dated Date specified above or
unless such date of authentication is an Auction Rate Note Interest Payment
Date, in which case this note shall bear interest from such Auction Rate Note
Interest Payment Date; PROVIDED, HOWEVER, that if as shown by the records of the
Indenture Trustee (defined herein) interest on the Class B-1 Notes (defined
herein) shall be in default, Class B-1 Notes issued in lieu of such Class B-1
Notes surrendered for transfer or exchange shall bear interest from the date to
which interest has been paid in full on the Class B-1 Notes surrendered until
payment of the principal hereof has been made or duly provided for. Principal of
this note is payable upon the presentation and surrender hereof at the principal
corporate trust office of U.S. Bank National Association, as indenture trustee
(the "Indenture Trustee"). Interest on this note is payable to the Registered
Owner of record as of the close of business on the applicable record date as
shown on the registration books of the Issuer maintained by the Indenture
Trustee in its capacity as bond registrar, or its successor in such capacity, by
check or draft mailed to the Registered Owner at the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
This note shall initially bear interest at the rate of interest per annum
established by the Broker-Dealers for the initial Auction Period pursuant to the
Broker-Dealer Agreements, written notice of which shall be given to the
Indenture Trustee. For each Auction Period thereafter, the unpaid principal
amount hereof from time to time outstanding shall bear interest at the Auction
Rate, except as hereinafter provided, determined in accordance with the
provisions of Appendix B to the Indenture, payable on each Auction Rate Note
Interest Payment Date and on the date of payment or redemption of principal
hereof to the extent of interest accrued on the principal then being paid or
redeemed, such interest to accrue from the later of the date hereof or the date
to
A-7-2
which interest has been paid or duly provided for. Interest at the Auction Rate
established from time to time pursuant to Appendix B to the Indenture shall be
computed for the actual number of days elapsed on the basis of a year consisting
of 365 or 366 days, as applicable, and as provided in Appendix B to the
Indenture.
This Note shall bear interest at an Auction Rate based on an Auction Period that
shall, until adjusted pursuant to Appendix B to the Indenture, generally consist
of 28 days, all as determined in Appendix B to the Indenture.
If, for any Auction Period, the Auction Rate exceeds the Maximum Auction Rate,
each as determined in accordance with the provisions of Appendix B to the
Indenture, then the applicable interest rate for this note for that Auction
Period will be the Maximum Auction Rate. The excess of the amount of interest
that would have accrued on this note at the Auction Rate over the amount of
interest actually accrued at the Maximum Auction Rate, together with any unpaid
portion of any such excess from prior Auction Periods, will accrue as the
Carry-over Amount. The Carry-over Amount will bear interest at a rate equal to
One-Month LIBOR (as defined in Appendix B to the Indenture) from the Auction
Rate Note Interest Payment Date for the Auction Period for which the Carry-over
Amount was calculated until paid or extinguished as described in the Indenture.
No reference to "principal" or "interest" in this note or in the Indenture shall
include within the meaning of such words any Carry-over Amount or any interest
accrued on any Carry-over Amount.
The Carry-over Amount (and interest accrued thereon) for the Class B-1 Notes
shall be paid by the Indenture Trustee, if ever, on the first occurring Auction
Rate Note Interest Payment Date for a subsequent Auction Period if and to the
extent set forth in the Indenture.
THE AUCTION PERIOD, THE AUCTION RATE, THE METHOD OF DETERMINING THE AUCTION RATE
AND THE MAXIMUM AUCTION RATE ON THIS NOTE AND THE AUCTION PROCEDURES RELATED
THERETO, A CHANGE IN THE AUCTION DATE AND THE AUCTION RATE NOTE INTEREST PAYMENT
DATES WILL BE DETERMINED IN ACCORDANCE WITH THE TERMS, CONDITIONS AND PROVISIONS
OF, INCLUDING, WITHOUT LIMITATION, REQUIRED NOTICES THEREOF TO THE REGISTERED
OWNERS OF THE CLASS B-1 NOTES, THE INDENTURE AND THE AUCTION AGENCY AGREEMENT,
TO WHICH TERMS, CONDITIONS AND PROVISIONS SPECIFIC REFERENCE IS HEREBY MADE, AND
ALL OF WHICH TERMS, CONDITIONS AND PROVISIONS ARE HEREBY SPECIFICALLY
INCORPORATED HEREIN BY REFERENCE.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed Auction Rate Notes, Class B-1 (the "Class B-1 Notes"),
issued pursuant to the Indenture, dated as of June 1, 2004, between the Issuer
and the Indenture Trustee, as indenture trustee (such indenture, as supplemented
or amended from time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
A-7-3
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class B-1 Notes. The Class
B-1 Notes, together with any additional notes issued pursuant to the Indenture
are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class B-1 Notes have been
issued and provisions made for their security and for the rights, duties and
obligations of the Issuer, the Indenture Trustee and the Registered Owners of
the Class B-1 Notes.
The Class B-1 Notes are issuable as registered notes in the denomination of
$50,000 or any integral multiple thereof. Subject to the limitations provided in
the Indenture and upon payment of any tax or governmental charge, Class B-1
Notes may be exchanged for a like Class and aggregate principal amount of Class
B-1 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue or not, for the purpose of receiving
payment of or on account of the principal or interest and for all other
purposes, and all such payments so made to the Registered Owner or upon such
Registered Owner's order shall be valid and effectual to satisfy and discharge
the liability on this note to the extent of the sum or sums so paid, and neither
the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
A-7-4
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
CERTIFICATE OF AUTHENTICATION
This note is one of the Class B-1 Notes and described in the provisions of the
within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-7-5
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-7-6
EXHIBIT A-8
-----------
FORM OF CLASS B-2 NOTE
----------------------
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE INDENTURE TRUSTEE, THE
REGISTRAR OR ANY AGENT THEREOF FOR REGISTRATION OF TRANSFER, EXCHANGE OR
PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED
OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE PURCHASER OR HOLDER OF THIS NOTE OR ANY INTEREST HEREIN WILL BE DEEMED TO
HAVE REPRESENTED THAT EITHER (I) IT IS NOT, AND IS NOT PURCHASING THIS NOTE ON
BEHALF OF, AS A FIDUCIARY OF, OR WITH "PLAN ASSETS" (WITHIN THE MEANING OF
SECTION 2510.3-101 OF THE U.S. DEPARTMENT OF LABOR REGULATIONS (THE "PLAN ASSET
REGULATION")) OF, AN "EMPLOYEE BENEFIT PLAN" (AS DEFINED IN SECTION 3(3) OF THE
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA")), A "PLAN"
(WITHIN THE MEANING OF SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986 (THE
"CODE")) OR ANY OTHER ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF ANY PLAN'S INVESTMENT IN THE ENTITY, WHICH IS SUBJECT TO TITLE I OF
ERISA OR SECTION 4975 OF THE CODE (A "PLAN"), OR (II)(A) THIS NOTE IS RATED
INVESTMENT GRADE OR BETTER AS OF THE DATE OF PURCHASE, (B) THE PURCHASER OR
HOLDER OF THE NOTE BELIEVES THAT THE NOTE IS PROPERLY TREATED AS INDEBTEDNESS
WITHOUT SUBSTANTIAL EQUITY FEATURES FOR PURPOSES OF THE PLAN ASSET REGULATION
AND AGREES TO SO TREAT SUCH NOTE AND (C) THE ACQUISITION AND HOLDING OF THE NOTE
DO NOT RESULT IN A VIOLATION OF THE PROHIBITED TRANSACTION RULES OF ERISA OR
SECTION 4975 OF THE CODE (X) BECAUSE IT IS COVERED BY AN APPLICABLE EXEMPTION,
INCLUDING PROHIBITED TRANSACTION CLASS EXEMPTION 96-23, 95-60, 91-38, 90-1 OR
84-14, OR (Y) BY REASON OF THE TRUST, THE ADMINISTRATOR, THE UNDERWRITERS, THE
SERVICERS, THE INDENTURE TRUSTEE, THE OWNER TRUSTEE, ANY PROVIDER OF CREDIT
SUPPORT OR ANY OF THEIR AFFILIATES NOT BEING A "PARTY IN INTEREST" (WITHIN THE
MEANING OF SECTION 3(14) OF ERISA) WITH RESPECT TO SUCH PLAN.
A-8-1
THE NATIONAL COLLEGIATE STUDENT LOAN TRUST 2004-1
STUDENT LOAN ASSET BACKED AUCTION RATE NOTES
CLASS B-2
No. B-2-___
INTEREST RATE DATE OF MATURITY DATED DATE CUSIP
Variable June 1, 2039 ______ __, 200_ ___________
REGISTERED OWNER: **CEDE & CO.**
PRINCIPAL AMOUNT: **$39,500,000**
The National Collegiate Student Loan Trust 2004-1, a statutory trust duly
organized and validly existing under the laws of the State of Delaware (the
"Issuer"), for value received, hereby promises to pay, but only from the sources
and as hereinafter provided, to the Registered Owner specified above, or
registered assigns, the Principal Amount shown above in lawful money of the
United States of America on the Date of Maturity shown above, unless prepaid
prior thereto with interest thereon from the Auction Rate Note Interest Payment
Date next preceding the date of authentication hereof, unless such date of
authentication is prior to the first Auction Rate Note Interest Payment Date, in
which case this note shall bear interest from the Dated Date specified above or
unless such date of authentication is an Auction Rate Note Interest Payment
Date, in which case this note shall bear interest from such Auction Rate Note
Interest Payment Date; PROVIDED, HOWEVER, that if as shown by the records of the
Indenture Trustee (defined herein) interest on the Class B-2 Notes (defined
herein) shall be in default, Class B-2 Notes issued in lieu of such Class B-2
Notes surrendered for transfer or exchange shall bear interest from the date to
which interest has been paid in full on the Class B-2 Notes surrendered until
payment of the principal hereof has been made or duly provided for. Principal of
this note is payable upon the presentation and surrender hereof at the principal
corporate trust office of U.S. Bank National Association, as indenture trustee
(the "Indenture Trustee"). Interest on this note is payable to the Registered
Owner of record as of the close of business on the applicable record date as
shown on the registration books of the Issuer maintained by the Indenture
Trustee in its capacity as bond registrar, or its successor in such capacity, by
check or draft mailed to the Registered Owner at the registered address.
Any capitalized words and terms used as defined words and terms in this note and
not otherwise defined herein shall have the meanings given them in the Indenture
(hereinafter defined).
This note shall initially bear interest at the rate of interest per annum
established by the Broker-Dealers for the initial Auction Period pursuant to the
Broker-Dealer Agreements, written notice of which shall be given to the
Indenture Trustee. For each Auction Period thereafter, the unpaid principal
amount hereof from time to time outstanding shall bear interest at the Auction
Rate, except as hereinafter provided, determined in accordance with the
provisions of Appendix B to the Indenture, payable on each Auction Rate Note
Interest Payment Date and on the date of payment or redemption of principal
hereof to the extent of interest accrued on the principal then being paid or
redeemed, such interest to accrue from the later of the date hereof or the date
to
A-8-2
which interest has been paid or duly provided for. Interest at the Auction Rate
established from time to time pursuant to Appendix B to the Indenture shall be
computed for the actual number of days elapsed on the basis of a year consisting
of 365 or 366 days, as applicable, and as provided in Appendix B to the
Indenture.
This Note shall bear interest at an Auction Rate based on an Auction Period that
shall, until adjusted pursuant to Appendix B to the Indenture, generally consist
of 28 days, all as determined in Appendix B to the Indenture.
If, for any Auction Period, the Auction Rate exceeds the Maximum Auction Rate,
each as determined in accordance with the provisions of Appendix B to the
Indenture, then the applicable interest rate for this note for that Auction
Period will be the Maximum Auction Rate. The excess of the amount of interest
that would have accrued on this note at the Auction Rate over the amount of
interest actually accrued at the Maximum Auction Rate, together with any unpaid
portion of any such excess from prior Auction Periods, will accrue as the
Carry-over Amount. The Carry-over Amount will bear interest at a rate equal to
One-Month LIBOR (as defined in Appendix B to the Indenture) from the Auction
Rate Note Interest Payment Date for the Auction Period for which the Carry-over
Amount was calculated until paid or extinguished as described in the Indenture.
No reference to "principal" or "interest" in this note or in the Indenture shall
include within the meaning of such words any Carry-over Amount or any interest
accrued on any Carry-over Amount.
The Carry-over Amount (and interest accrued thereon) for the Class B-2 Notes
shall be paid by the Indenture Trustee, if ever, on the first occurring Auction
Rate Note Interest Payment Date for a subsequent Auction Period if and to the
extent set forth in the Indenture.
THE AUCTION PERIOD, THE AUCTION RATE, THE METHOD OF DETERMINING THE AUCTION RATE
AND THE MAXIMUM AUCTION RATE ON THIS NOTE AND THE AUCTION PROCEDURES RELATED
THERETO, A CHANGE IN THE AUCTION DATE AND THE AUCTION RATE NOTE INTEREST PAYMENT
DATES WILL BE DETERMINED IN ACCORDANCE WITH THE TERMS, CONDITIONS AND PROVISIONS
OF, INCLUDING, WITHOUT LIMITATION, REQUIRED NOTICES THEREOF TO THE REGISTERED
OWNERS OF THE CLASS B-2 NOTES, THE INDENTURE AND THE AUCTION AGENCY AGREEMENT,
TO WHICH TERMS, CONDITIONS AND PROVISIONS SPECIFIC REFERENCE IS HEREBY MADE, AND
ALL OF WHICH TERMS, CONDITIONS AND PROVISIONS ARE HEREBY SPECIFICALLY
INCORPORATED HEREIN BY REFERENCE.
This note is one of a duly authorized class of notes of the Issuer designated
Student Loan Asset Backed Auction Rate Notes, Class B-2 (the "Class B-2 Notes"),
issued pursuant to the Indenture, dated as of June 1, 2004, between the Issuer
and the Indenture Trustee, as indenture trustee (such indenture, as supplemented
or amended from time to time in accordance with its terms, the "Indenture").
The Indenture pledges for the payment of the Notes (as hereinafter defined) the
student loans identified in the Indenture (the "Financed Student Loans") and the
payments of interest and the repayments of principal with respect thereto,
including certain guarantees related thereto, as well as certain other rights,
funds and accounts of the Issuer set forth in the Indenture, including a Reserve
Account (collectively, the "Trust Estate").
A-8-3
This note is a limited obligation of the Issuer, payable solely from the
principal and interest on Financed Student Loans financed pursuant to the
Indenture, any guaranty payments thereon received by the Issuer, and certain
other revenues and earnings to be held pursuant to the Indenture, all in an
amount and in the manner provided in the Indenture. Additional notes and other
obligations may be issued or entered into under the Indenture the right to
payment of which is equal with or subordinate to the Class B-2 Notes. The Class
B-2 Notes, together with any additional notes issued pursuant to the Indenture
are collectively referred to herein as "Notes."
The Notes are secured as provided in the Indenture, but solely by the pledge of
the Trust Estate described in the Indenture; provided that the rights of the
holders of the Class A Notes shall be superior to the rights of the Registered
Owners of Class B Notes. Reference is made to the Indenture for a complete
statement of the terms and conditions upon which the Class B-2 Notes have been
issued and provisions made for their security and for the rights, duties and
obligations of the Issuer, the Indenture Trustee and the Registered Owners of
the Class B-2 Notes.
The Class B-2 Notes are issuable as registered notes in the denomination of
$50,000 or any integral multiple thereof. Subject to the limitations provided in
the Indenture and upon payment of any tax or governmental charge, Class B-2
Notes may be exchanged for a like Class and aggregate principal amount of Class
B-2 Notes of other authorized denominations.
The Registered Owner of this note shall have no right to enforce the provisions
of the Indenture or to institute action to enforce the covenants therein, or to
take any action with respect to any Event of Default under the Indenture, or to
institute, appear in or defend any suit or other proceedings with respect
thereto, except as provided in the Indenture. If an Event of Default under the
Indenture occurs, the principal of all Notes then Outstanding issued under the
Indenture may be declared due and payable upon the conditions and in the manner
and with the effect provided in the Indenture.
IT IS HEREBY CERTIFIED, RECITED AND DECLARED that all acts, conditions and
things required to be done, to exist, to happen and to be performed in order to
make this note a valid and binding obligation of the Issuer according to its
terms have been done, do exist, have happened and have been performed in regular
and due form, time and manner as so required.
The Issuer and the Indenture Trustee may deem and treat the person in whose name
this note is registered upon the registration books as the absolute owner
hereof, whether this note is overdue or not, for the purpose of receiving
payment of or on account of the principal or interest and for all other
purposes, and all such payments so made to the Registered Owner or upon such
Registered Owner's order shall be valid and effectual to satisfy and discharge
the liability on this note to the extent of the sum or sums so paid, and neither
the Issuer nor Indenture Trustee nor any Registrar shall be affected by any
notice to the contrary.
This note shall not be valid or become obligatory for any purpose or be entitled
to any security or benefit under the Indenture until the Certificate of
Authentication hereon shall have been executed by the Indenture Trustee.
A-8-4
IN WITNESS WHEREOF, The National Collegiate Student Loan Trust 2004-1 has caused
this note to be executed and attested.
THE NATIONAL COLLEGIATE
STUDENT LOAN TRUST 2004-1
By: WACHOVIA TRUST COMPANY,
NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Owner Trustee
By: __________________________________
Name:
Title:
Attest
_______________________________
A-8-5
CERTIFICATE OF AUTHENTICATION
This note is one of the Class B-2 Notes and described in the provisions of the
within-mentioned Indenture.
Date of Authentication: __________________
U.S. BANK NATIONAL ASSOCIATION,
as Authenticating Agent
By _____________________________
Authorized Signatory
A-8-6
ASSIGNMENT
For Value Received _____________________ hereby sell(s), assign(s) and
transfer(s) unto
_______________________________________________________________________________
(Please print or type an address (Social Security number
including postal zip code of transferee) of transferee)
the within note, together with accrued interest
thereon and all right, title and interest thereto, and hereby
irrevocably authorize(s) and appoint(s)
_______________________________________ attorney to transfer
said note on the books of the within named Corporation with
full power of substitution in the premises.
Dated ________________ ____________________________L.S.
Guaranteed by:
____________________________________
A-8-7
EXHIBIT B
---------
FORM OF STUDENT LOAN ACQUISITION CERTIFICATE
--------------------------------------------
This Student Loan Acquisition Certificate is submitted pursuant to the
provisions of the Indenture, dated as of June 1, 2004 (as amended, the
"Indenture"), between The National Collegiate Student Loan Trust 2004-1 (the
"Issuer") and U.S. Bank National Association, as Indenture Trustee. All
capitalized terms used in this Certificate and not otherwise defined herein
shall have the same meanings given to such terms in the Indenture. In your
capacity as Trustee, you are hereby authorized and requested to disburse to
_____________________ (the "Seller") the sum of approximately $__________ in
accordance with specific instructions that will follow (or, in the case of an
exchange, the Financed Student Loans listed in Schedule A hereto) for the
purchase of Student Loans. With respect to the Student Loans so to be acquired,
the Issuer hereby certifies as follows:
(1) The Student Loans to be acquired are those specified in
Schedule A, attached hereto and furnished to you by the Servicer (the
"Subsequent Student Loans"). The remaining unpaid principal amount of
each Subsequent Student Loan is as shown on such Schedule.
(2) The amount to be disbursed pursuant to this Certificate
does not exceed the amount permitted by Section 8.10 of the Indenture.
(3) The Issuer and Seller represent that each Subsequent
Student Loan is a Student Loan that meets the requirements of Section
3.21 of the Indenture and each such Student Loan is authorized to be
acquired by the Indenture.
(4) You have been previously, or are herewith, provided with
the following items (the items listed in subparagraphs (a), (b) and (c)
have been received and are being retained, on your behalf, by the
Issuer or the Servicer):
(a) a copy of the Student Loan Purchase
Agreement between the Issuer and the Seller with respect to
the Subsequent Student Loans;
(b) with respect to each Guaranteed Student
Loan included among the Subsequent Student Loans, a certified
copy of the Guarantee Agreement relating thereto;
(c) a blanket endorsement of the promissory
notes evidencing the Subsequent Student Loans specifying that
they have been assigned to the Trustee with all necessary
endorsements which the Servicer has been instructed to attach
to each promissory note;
(d) instruments duly assigning the
Subsequent Student Loans to the Trustee; and
B-1
(e) an opinion of counsel to the Issuer
specifying each action necessary to perfect a security
interest in all Subsequent Student Loans to be acquired by the
Issuer pursuant to the Student Loan Purchase Agreement in
favor of the Trustee, including, if applicable, in the manner
provided for by the provisions of 20 U.S.C. ss. 1087-2(d)(3)
or 20 U.S.C. ss. 1082(m)(1)(d)(iv), as applicable (you Are
authorized to rely on the advice of a single blanket opinion
of counsel to the Issuer until such time as this Issuer shall
provide any amended opinion to you).
(5) The Issuer is not, on the date hereof, in default under the
Indenture or the Student Loan Purchase Agreement applicable to the Subsequent
Student Loans, and, to the best knowledge of the Issuer, the Seller is not in
default under the Student Loan Purchase Agreement applicable to the Subsequent
Student Loans. The Issuer is not aware of any default existing on the date
hereof under any of the other documents referred to in paragraph 4 hereof.
(6) All of the conditions specified in the Student Loan Purchase
Agreement applicable to the Subsequent Student Loans and in the Indenture for
the disbursement hereby authorized and requested have been satisfied; provided
that the Administrator may waive any requirement of receiving an opinion of
counsel from the counsel to the Seller.
(7) The Issuer is not in default in the performance of any of its
covenants and agreements made in the Guarantee Agreement applicable to the
Subsequent Student Loans.
(8) The proposed use of moneys in the Pre-Funding Account is in
compliance with the provisions of the Indenture.
(9) The undersigned is authorized to sign and submit this Certificate
on behalf of the Depositor.
B-2
WITNESS my hand this __ day of __________, 20__.
THE NATIONAL COLLEGIATE STUDENT
LOAN TRUST 2004-1
By [______________________]
By______________________________
Name____________________________
Title___________________________
B-3
EXHIBIT C
---------
FORM OF TRANSFEREE LETTER
-------------------------
[Non-Rule 144a]
---------------
[Date]
The National Collegiate Student Loan Trust 2004-1
c/o Wachovia Trust Company, National Association, as Owner Trustee
One Xxxxxx Square, 1st Floor
000 Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
with a copy to:
The First Marblehead Corporation
The Prudential Tower
000 Xxxxxxxx Xxxxxx - 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-8157
Attention: Controller
Copy to:
Xxxxxxx X. Xxxxxxx, Esq.
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCSLT 2003-1
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-I)-2 Notes
----------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above-captioned Notes, we certify that
(a) we understand that the Notes are not being registered under the Securities
Act of 1933, as amended (the "Act"), or any state securities laws and are being
transferred to us in a transaction that is exempt from the registration
requirements of the Act and any such laws, (b) we have had the opportunity to
ask questions of and receive answers from The National Collegiate Student Loan
Trust 2004-1 concerning the purchase of the Notes and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Notes, (c) we are acquiring the Notes for investment for our own
account and not with a view to any distribution
C-1
of such Notes (but without prejudice to our right at all times to sell or
otherwise dispose of the Notes in accordance with clause (e) below), (d) we have
not offered or sold any Notes to, or solicited offers to buy any Notes from, any
person, or otherwise approached or negotiated with any person with respect
thereto, or taken any other action which would result in a violation of Section
5 of the Act, (e) we will not sell, transfer or otherwise dispose of any Notes
unless (1) such sale, transfer or other disposition is made pursuant to an
effective registration statement under the Act or is exempt from such
registration requirements, and if requested, we will at our expense provide an
opinion of counsel satisfactory to the addressees of this certificate that such
sale, transfer or other disposition may be made pursuant to an exemption from
the Act, (2) the purchaser or transferee of such Note has executed and delivered
to you a certificate to substantially the same effect as this certificate if
required by the Indenture, and (3) the purchaser or transferee has otherwise
complied with any conditions for transfer set forth in the Indenture, (f) the
purchaser is not acquiring a Note, directly or indirectly, as a fiduciary of, on
behalf of, or with the "Plan Assets" (within the meaning of Section 2510.3-101
of the U.S. Department of Labor regulations (the "Plan Asset Regulation")) of,
an "employee benefit plan" (as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")), a "plan" (within
the meaning of Section 4975 of the Internal Revenue Code of 1986 (the "Code"))
or any other entity whose underlying assets include Plan Assets by reason of any
plan's investment in the entity, which is subject to Title I of ERISA or Section
4975 of the Code (a "Plan"); unless (i) such Note is rated investment grade or
better as of the date of purchase, (ii) the purchaser of the Note believes that
the Note is properly treated as indebtedness without substantial equity features
for purposes of the Plan Asset Regulation and agrees to so treat such Note and
(iii) the acquisition and holding of the Note does not result in a violation of
the prohibited transaction rules of ERISA or Section 4975 of the Code (A)
because it is covered by an applicable exemption, including Prohibited
Transaction Class Exemption 96-23, 95-60, 91-38, 90-1 or 84-14, or (B) by reason
of the Trust, the Administrator, the Initial Purchasers, the Servicers, the
Indenture Trustee, the Owner Trustee, any provider of credit support or any of
their affiliates not being a "Party in Interest" (within the meaning of Section
3(14) of ERISA) with respect to such Plan, and (g) if the purchaser is acquiring
a Class A-4 Note, Class A-IO-1 Note or a Class A-IO-2 Note, the purchaser also
simultaneously is acquiring a proportionate amount of the Class A-IO-1 Notes,
Class A-IO-2 Notes or Class A-4 Notes, as applicable, such that the ratio and
the principal balance of the Class A-4 Note being acquired to all Class A-4
Notes and the ratio and the notional amount of the Class A-IO-1 Note and Class
A-IO-2 Note being acquired to all Class A-IO-1 Notes and Class A-IO-2 Notes are
equal.
Very truly yours,
________________________
Print Name of Transferee
By:___________________
Authorized Officer
C-2
EXHIBIT D
---------
FORM OF RULE 144A CERTIFICATION
-------------------------------
[Date]
The National Collegiate Student Loan Trust 2004-1
c/o Wachovia Trust Company, National Association, as Owner Trustee
One Xxxxxx Square, 1st Floor
000 Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
with a copy to:
The First Marblehead Corporation
The Prudential Tower
000 Xxxxxxxx Xxxxxx - 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-8157
Attention: Controller
Copy to:
Xxxxxxx X. Xxxxxxx, Esq.
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCSLT 2003-1
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-IO-2 Notes
----------------------------------------------
Ladies and Gentlemen:
In connection with our acquisition of the above Notes we certify that
(a) we understand that the Notes are not being registered under the Securities
Act of 1933, as amended (the "Act"), or any state securities laws and are being
transferred to us in a transaction that is exempt from the registration
requirements of the Act and any such laws, (b) we have had the opportunity to
ask questions of and receive answers from The National Collegiate Student Loan
Trust 2004-1 concerning the purchase of the Notes and all matters relating
thereto or any additional information deemed necessary to our decision to
purchase the Notes, (c) we have not, nor has anyone acting on our behalf
offered, transferred, pledged, sold or otherwise disposed of the Notes, any
interest in the Notes or any other similar security to, or solicited any offer
to buy or
D-1
accept a transfer, pledge or other disposition of the Notes, any interest in the
Notes or any other similar security from, or otherwise approached or negotiated
with respect to the Notes, any interest in the Notes or any other similar
security with, any person in any manner, or made any general solicitation by
means of general advertising or in any other manner, or taken any other action,
that would constitute a distribution of the Notes under the Act or that would
render the disposition of the Notes a violation of Section 5 of the Act or
require registration pursuant thereto, nor will act, nor has authorized or will
authorize any person to act, in such manner with respect to the Notes, (d) we
are a "qualified institutional buyer" as that term is defined in Rule 144A under
the Act and have completed the form of certification to that effect attached
hereto as Annex 1, (e) we are not acquiring a Note, directly or indirectly, as a
fiduciary of, on behalf of, or with the "Plan Assets" (within the meaning of
Section 2510.3-101 of the U.S. Department of Labor regulations (the "Plan Asset
Regulation")) of, an "employee benefit plan" (as defined in Section 3(3) of the
Employee Retirement Income Security Act of 1974, as amended ("ERISA")), a "plan"
(within the meaning of Section 4975 of the Internal Revenue Code of 1986 (the
"Code")) or any other entity whose underlying assets include Plan Assets by
reason of any plan's investment in the entity, which is subject to Title I of
ERISA or Section 4975 of the Code (a "Plan"); unless (i) such Note is rated
investment grade or better as of the date of purchase, (ii) the purchaser of the
Note believes that the Note is properly treated as indebtedness without
substantial equity features for purposes of the Plan Asset Regulation and agrees
to so treat such Note and (iii) the acquisition and holding of the Note does not
result in a violation of the prohibited transaction rules of ERISA or Section
4975 of the Code (A) because it is covered by an applicable exemption, including
Prohibited Transaction Class Exemption 96-23, 95-60, 91-38, 90-1 or 84-14, or
(B) by reason of the Trust, the Administrator, the Initial Purchasers, the
Servicers, the Indenture Trustee, the Owner Trustee, any provider of credit
support or any of their affiliates not being a "Party in Interest" (within the
meaning of Section 3(14) of ERISA) with respect to such Plan, (f) if the
Purchaser is acquiring a Class A-4 Note, Class A-IO-1 Note or a Class A-IO-2
Note, the purchaser also simultaneously is acquiring a proportionate amount of
the Class A-IO-1 Notes, Class A-IO-2 Notes or Class A-4 Notes, as applicable,
such that the ratio and the principal balance of the Class A-4 Note being
acquired to all Class A-4 Notes and the ratio and the notional amount of the
Class A-IO-1 Note being acquired to all Class A-IO-1 Notes and Class A-IO-2
Notes are equal. We are aware that the sale to us is being made in reliance on
Rule 144A. We are acquiring the Notes for our own account or for resale pursuant
to Rule 144A and further, understand that such Notes may be resold, pledged or
transferred only (i) to a person reasonably believed to be a qualified
institutional buyer that purchases for its own account or for the account of a
qualified institutional buyer to whom notice is given that the resale, pledge or
transfer is being made in reliance on Rule 144A, or (ii) pursuant to another
exemption from registration under the Act.
Very truly yours,
_________________________
Print Name of Transferee
By:___________________
Authorized Officer
D-2
ANNEX 1 TO EXHIBIT D
[FORM OF CERTIFICATION]
[Date]
The National Collegiate Student Loan Trust 2004-1
c/o Wachovia Trust Company, National Association, as Owner Trustee
One Xxxxxx Square, 1st Floor
000 Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Administration
with a copy to:
The First Marblehead Corporation
The Prudential Tower
000 Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-8157
Attention: Controller
Copy to:
Xxxxxxx X. Xxxxxxx, Esq.
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCSLT 2003-1
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-IO-2 Notes
----------------------------------------------
Ladies and Gentlemen:
In connection with our purchase of the above Notes, the undersigned
certifies to each of the parties to whom this letter is addressed that it is a
qualified institutional buyer (as defined in Rule 144A under the Securities Act
of 1933, as amended (the "Act")) as follows:
1. It owns and/or invests on a discretionary basis eligible
securities (excluding affiliate's securities, bank deposit
notes and CD's, loan participations, repurchase agreements,
securities owned but subject to a repurchase agreement and
currency, interest rate and commodity swaps), as described
below:
1
Amount:1 $_________________; and
2. The dollar amount set forth above is:
a. greater than $100 million and the undersigned is one of the following
entities:
(1) |_| an insurance company as defined in Section 2(13) of the Act;*
or
(2) |_| an investment company registered under the Investment Company
Act or any business development company as defined in Section 2(a)(48)
of the Investment Company Act of 1940 or as defined in Section
202(a)(22) of the Investment Advisers Act of 1940; or
(3) |_| a Small Business Investment Company licensed by the U.S. Small
Business Administration under Section 301(c) or (d) of the Small
Business Investment Act of 1958; or
(4) |_| a plan (i) established and maintained by a state, its political
subdivisions, or any agency or instrumentality of a state or its
political subdivisions, the laws of which permit the purchase of
securities of this type, for the benefit of its employees and (ii) the
governing investment guidelines of which permit the purchase of
securities of this type; or
(5) |_| a corporation (other than a U.S. bank, savings and loan
association or equivalent foreign institution), partnership,
Massachusetts or similar business trust, or an organization described
in Section 501(c)(3) of the Internal Revenue Code; or
(6) |_| a U.S. bank, savings and loan association or equivalent foreign
institution, which has an audited net worth of at least $25 million as
demonstrated in its latest annual financial statements as of a date not
more than 16 months preceding the date of sale in the case of a U.S.
institution or 18 months in the case of a foreign institution; or
(7) |_| an investment adviser registered under the Investment Advisers
Act; or
b. |_| greater than $10 million, and the undersigned is a
broker-dealer registered with the SEC; or
c. |_| greater than $10 million, and the undersigned is a
broker-dealer registered with the SEC and will only purchase Rule
144A securities in riskless principal transactions (as defined in
Rule 144A); or
--------------------------
1 Must be calculated using only securities which the undersigned beneficially
held as of the date below.
* A purchase by an insurance company for one or more of its separate
accounts, as defined by section 2(a)(37) of the Investment Company Act of
1940, which are neither registered nor required to be registered
thereunder, shall be deemed to be a purchase for the account of such
insurance company.
2
d. |_| greater than $100 million, and the undersigned is an
investment company registered under the Investment Company Act of
1940, which, together with one or more registered investment
companies having the same or an affiliated investment adviser,
owns at least $100 million of eligible securities; or
e. |_| greater than $100 million, and the undersigned is an
entity, all the equity owners of which are qualified institutional
buyers.
The undersigned further certifies that it is purchasing Notes for its own
account or for the account of others that independently qualify as "Qualified
Institutional Buyers" as defined in Rule 144A. It is aware that the sale of
the Notes is being made in reliance on its continued compliance with Rule
144A. It is aware that the transferor may rely on the exemption from the
provisions of Section 5 of the Act provided by Rule 144A. The undersigned
understands that the Notes may be resold, pledged or transferred only to a
person reasonably believed to be a Qualified Institutional Buyer that
purchases for its own account or for the account of a Qualified Institutional
Buyer to whom notice is given that the resale, pledge or transfer is being
made in reliance in Rule 144A.
The undersigned agrees that if at some time before the expiration of the
holding period described in Rule 144 it wishes to dispose of or exchange any
of the Notes, it will not transfer or exchange any of the Notes to a Qualified
Institutional Buyer without first obtaining a letter in the form hereof from
the transferee and delivering such certificate to the addressees hereof.
IN WITNESS WHEREOF, this document has been executed by the undersigned who is
duly authorized to do so on behalf of the undersigned Qualified Institutional
Buyer on the _____ day of ___________, ____.
Name of Institution
Signature
Name
Title**
3
--------------------
**Must be President, Chief Financial Officer, or other executive officer.
4
EXHIBIT E
---------
FORM OF TRANSFER CERTIFICATE FOR RULE 144A GLOBAL NOTE TO
---------------------------------------------------------
REGULATION S GLOBAL NOTE DURING RESTRICTED PERIOD
-------------------------------------------------
[Date]
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCSLT 2003-1
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-IO-2 Notes
----------------------------------------------
Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of June 1, 2004 (the
"Agreement"), between The National Collegiate Student Loan Trust 2004-1, as
Issuer (the "Issuer"), and U.S. Bank National Association, as indenture trustee
(the "Indenture Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Agreement.
This letter relates to US $[_______] aggregate current principal amount of Class
__ Notes (the "Notes") which are held in the form of the Rule 144A Global Note
(CUSIP No. _________) with the Depository in the name of [insert name of
transferor] (the "Transferor"). The Transferor has requested a transfer of such
beneficial interest for an interest in the Regulation S Global Note (CUSIP No.
__________) to be held with [Euroclear] [Clearstream] (Common Code
No.____________) through the Depository.
In connection with such request and in respect of such Notes, the Transferor
does hereby certify that such transfer has been effected in accordance with the
transfer restrictions set forth in the Agreement and pursuant to and in
accordance with Regulation S under the Securities Act of 1933, as amended (the
"Securities Act"), and accordingly the Transferor does hereby certify that:
1. the offer of the Notes was not made to a person in the United
States,
2. [at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting
on its behalf reasonably believed that the transferee was outside
the United States] [the transaction was executed in, on or
through the facilities of a designated offshore securities market
and neither
E-1
the transferor nor any person acting on its behalf knows that the
transaction was pre-arranged with a buyer in the United States],
3. the transferee is not a U.S. Person within the meaning of Rule
902(o) of Regulation S nor a Person acting for the account or
benefit of a U.S. Person,
4. no directed selling efforts have been made in contravention of
the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable,
5. the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act, and
6. upon completion of the transaction, the beneficial interest being
transferred as described above will be held with the Depository
through [Euroclear] [Clearstream].
This certificate and the statements contained herein are made for your benefit
and the benefit of the Indenture Trustee and the Issuer.
[Insert Name of Transferor]
By:_______________________________
Name:
Title:
Dated:
E-2
EXHIBIT F
---------
FORM OF TRANSFER CERTIFICATE FOR RULE 144A GLOBAL NOTE TO
---------------------------------------------------------
REGULATION S GLOBAL NOTE AFTER RESTRICTED PERIOD
------------------------------------------------
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCSLT 2003-1
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-IO-2 Notes
----------------------------------------------
Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of June 1, 2004 (the
"Agreement"), between The National Collegiate Student Loan Trust 2004-1, as
Issuer (the "Issuer"), and U.S. Bank National Association, as indenture trustee
(the "Indenture Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Agreement.
This letter relates to US $[________] aggregate current principal amount of
Class __ Notes (the "Notes") which are held in the form of the Rule 144A Global
Note (CUSIP No. ________) with the Depository in the name of [insert name of
transferor] (the "Transferor"). The Transferor has requested a transfer of such
beneficial interest in the Notes for an interest in the Regulation S Global Note
(Common Code No. _____).
In connection with such request, and in respect of such Notes, the Transferor
does hereby certify that such transfer has been effected in accordance with the
transfer restrictions set forth in the Agreement and, (i) with respect to
transfers made in reliance on Regulation S under the Securities Act of 1933, as
amended (the "Securities Act"), the Transferor does hereby certify that:
1. the offer of the Notes was not made to a person in the United
States;
2. [at the time the buy order was originated, the transferee was
outside the United States or the Transferor and any person acting
on its behalf reasonably believed that the transferee was outside
the United States] [the transaction was executed in, on or
through the facilities of a designated offshore securities market
and neither
F-1
the Transferor nor any person acting on its behalf knows that the
transaction was pre-arranged with a buyer in the United States];
3. no directed selling efforts have been made in contravention of
the requirements of Rule 903(b) or Rule 904(b) of Regulation S,
as applicable; and
4. the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act,
or (ii) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that the Notes that are being
transferred are not "restricted securities" as defined in Rule 144 under the
Securities Act.
This certificate and the statements contained herein are made for your benefit
and the benefit of the Indenture Trustee and the Issuer.
[Insert Name of Transferor]
By:_______________________________
Name:
Title:
Dated:
F-2
EXHIBIT G
---------
FORM OF TRANSFER CERTIFICATE REGULATION S GLOBAL NOTE
-----------------------------------------------------
TO RULE 144A GLOBAL NOTE DURING RESTRICTED PERIOD
-------------------------------------------------
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCSLT 2003-1
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-IO-2 Notes
----------------------------------------------
Ladies and Gentlemen:
Reference is hereby made to the Indenture, dated as of June 1, 2004 (the
"Agreement"), between The National Collegiate Student Loan Trust 2003-1, as
Issuer (the "Issuer"), and U.S. Bank National Association, as indenture trustee
(the "Indenture Trustee"). Capitalized terms used but not defined herein shall
have the meanings given to them in the Agreement.
This letter relates to US $[________] aggregate current principal amount of
Class __ Notes (the "Notes") which are held in the form of the Regulation S
Global Note (CUSIP No. _______) with [Euroclear] [Clearstream] (Common Code
No.__________) through the Depository in the name of [insert name of transferor]
(the "Transferor"). The Transferor has requested a transfer of such beneficial
interest in the Notes for an interest in the Regulation 144A Global Note (CUSIP
No.____________).
In connection with such request, and in respect of such Notes, the Transferor
does hereby certify that such Notes are being transferred in accordance with (i)
the transfer restrictions set forth in the Agreement and (ii) Rule 144A under
the Securities Act to a transferee that the Transferor reasonably believes is
purchasing the Notes for its own account with respect to which the transferee
exercises sole investment discretion and the transferee and any such account is
a "qualified institutional buyer" within the meaning of Rule 144A, in each case
in a transaction meeting the requirements of Rule 144A and in accordance with
any applicable securities laws of any state of the United States or any
jurisdiction.
G-1
This certificate and the statements contained herein are made for your benefit
and the benefit of the Indenture Trustee, the Issuer and placement agent of the
offering of the Notes.
[Insert Name of Transferor]
By:_______________________________
Name:
Title:
Dated:
G-2
EXHIBIT H
---------
FORM OF TRANSFER CERTIFICATE FOR REGULATION S
---------------------------------------------
GLOBAL NOTE DURING RESTRICTED PERIOD
------------------------------------
U.S. Bank National Association Corporate Trust Department -- SFS Xxx Xxxxxxx
Xxxxxx, 0xx Xxxxx Xxxxxx, Xxxxxxxxxxxxx 00000 Attention: NCT 2003-1 Auction Rate
Notes
Re: The National Collegiate Student Loan Trust 2004-1,
Class A-4, Class A-IO-1 and Class A-IO-2 Notes
----------------------------------------------
Ladies and Gentlemen:
This certificate is delivered pursuant to Section 2.04 of the Indenture, dated
as of June 1, 2004 (the "Agreement"), between The National Collegiate Student
Loan Trust 2003-1, as Issuer (the "Issuer"), and U.S. Bank National Association,
as indenture trustee (the "Indenture Trustee"), in connection with the transfer
by the undersigned (the "Transferor") to _________________ (the "Transferee") of
$__________________ current principal amount of Class ___ Notes, in fully
registered form (each, an "Individual Note"), or a beneficial interest of such
aggregate current principal amount in the Regulation S Global Note (the "Global
Note") maintained by The Depository Trust Company or its successor as Depository
under the Agreement (such transferred interest, in either form, being the
"Transferred Interest").
In connection with such transfer, the Transferor does hereby certify that such
transfer has been effected in accordance with the transfer restrictions set
forth in the Agreement and the Notes and (i) with respect to transfers made in
accordance with Regulation S ("Regulation S") promulgated under the Securities
Act of 1933, as amended (the "Securities Act"), the Transferor does hereby
certify that:
1. the offer of the Transferred Interest was not made to a
person in the United States;
2. [at the time the buy order was originated, the Transferee
was outside the United States or the Transferor and any
person acting on its behalf reasonably believed that the
Transferee was outside the United States] [the transaction
was executed in, on or through the facilities of a
designated offshore securities
H-1
market and neither the undersigned nor any person acting on
its behalf knows that the transaction was pre-arranged with
a buyer in the United States];
3. the transferee is not a U.S. Person within the meaning of
Rule 902(o) of Regulation S nor a person acting for the
account or benefit of a U.S. Person, and upon completion of
the transaction, the Transferred Interest will be held with
the Depository through [Euroclear] [Clearstream];
4. no directed selling efforts have been made in contravention
of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S, as applicable; and
5. the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act.
or (ii) with respect to transfers made in reliance on Rule 144 under the
Securities Act, the Transferor does hereby certify that the Certificates that
are being transferred are not "restricted securities" as defined in Rule 144
under the Securities Act.
This certificate and the statements contained herein are made for your benefit
and the benefit of the Indenture Trustee and the Issuer.
[Insert Name of Transferor]
By:_______________________________
Name:
Title:
Dated:
H-2
EXHIBIT I
---------
FORM CERTIFICATION TO BE
PROVIDED TO DEPOSITOR BY THE INDENTURE TRUSTEE
Re: The National Collegiate Funding LLC
The undersigned, U.S. Bank National Association, solely in its
capacity as Indenture Trustee under that certain Indenture dated as of June 1,
2004 (the "Indenture") between The National Collegiate Student Loan Trust 2004-1
and U.S. Bank National Association, hereby certifies that:
1. The Indenture Trustee has reviewed the annual report on
Form 10-K for the fiscal year [____], and all reports on Form 8-K containing
distribution reports filed in respect of periods included in the year covered by
that annual report, of the Registrant relating to the above-referenced trust;
2. Subject to paragraph 4 below and based on the knowledge of
the officer of the Indenture Trustee signing this certification, the information
in the distribution reports prepared by the Indenture Trustee, taken as a whole,
does not contain any untrue statement of material fact or omit to state a
material fact necessary to make the statements made, in light of the
circumstances under which such statements were made, not misleading as of the
last day of the period covered by that annual report; and
3. Based on the Indenture Trustee's knowledge, the
distribution or servicing information required to be provided by the Indenture
Trustee under the Indenture, to the extent received by the Indenture Trustee
from the Administrator, is included in these distribution reports.
4. In compiling the information in the distribution reports
and making the foregoing certifications, the Indenture Trustee has relied upon
information furnished to it by the Administrator under the Indenture. The
Indenture Trustee shall have no responsibility or liability for any inaccuracy
in such reports resulting from information so provided to it by the
Administrator.
5. For purposes of this certificate, an officer shall mean any
officer of the Indenture Trustee with direct responsibility for the
administration of the Indenture, and shall also mean, with respect to a
particular corporate trust matter, any other officer to whom such matter is
referred because of his or her knowledge and familiarity with the particular
subject.
I-1
Capitalized terms used and not defined herein shall have the
meanings given to such terms in the Indenture.
Date:
X.X.Xxxx National Association,
solely in its capacity as
Indenture Trustee
By:
------------------------
Name:
Title:
I-2
