EXHIBIT 99.3
ADMINISTRATION AGREEMENT dated as of November 1, 2001 among
XXXXX FARGO STUDENT LOAN TRUST 2001-1, a Delaware trust (the
"Issuer"), XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION, a
national banking association, as administrator (the
"Administrator"), and JPMORGAN CHASE BANK, a New York banking
corporation, not in its individual capacity but solely as Indenture
Trustee (the "Indenture Trustee").
WITNESSETH
WHEREAS, the Issuer was formed pursuant to the Trust Agreement dated
as of November 1, 2001 (the "Trust Agreement") between Xxxxx Fargo Student
Loans Receivables I, LLC, as depositor, and Bank One, National Association
("Bank One"), as eligible lender trustee (the "Eligible Lender Trustee") and
is issuing the Class A-1 Floating Rate Asset-Backed Senior Notes (the "Class
A-1 Notes"), the Class A-2 Floating Rate Asset-Backed Senior Notes (the "Class
A-2 Notes" and, together with the Class A-1 Notes, the "Senior Notes") and the
Class B Floating Rate Asset-Backed Subordinate Notes (the "Subordinate Notes"
and, together with the Senior Notes, the "Notes") pursuant to the Indenture
dated as of November 1, 2001 (the "Indenture"), between the Issuer and the
Indenture Trustee, (capitalized terms used herein and not defined herein shall
have the meanings assigned to such terms in Appendix A hereto, which also
contains rules of usage and construction that shall be applicable herein); and
WHEREAS, the Issuer has entered into certain agreements in
connection with the issuance of the Notes, including the Basic Documents; and
WHEREAS, pursuant to the Basic Documents, the Issuer and the
Eligible Lender Trustee are required to perform certain duties in connection
with the Notes and the Collateral therefor pledged pursuant to the Indenture;
and
WHEREAS, the Issuer and the Eligible Lender Trustee desire to have
the Administrator perform certain of the duties of the Issuer and the Eligible
Lender Trustee referred to in the preceding clause, and to provide such
additional services consistent with the terms of this Agreement and the Basic
Documents as the Issuer and the Eligible Lender Trustee may from time to time
request; and
WHEREAS, the Administrator has the capacity to provide the services
required hereby and is willing to perform such services for the Issuer and the
Eligible Lender Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants contained
herein, and other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties agree as follows:
Section 1. Representations of the Administrator. The Administrator
makes the following representations on which the Issuer, the Eligible Lender
Trustee and the Swap Counterparty are deemed to have relied. The
representations speak as of the execution and delivery of this Agreement and
as of the Closing Date and shall survive the sale of the Financed Student
Loans to the Eligible Lender Trustee on behalf of the Issuer and the pledge
thereof to the Indenture Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Administrator is a national
banking association duly organized and validly existing in good standing
under the laws of the United States. It has all requisite power and
authority to execute, deliver and perform its obligations under this
Agreement.
(b) Power and Authority of the Administrator. The Administrator has
taken all action necessary to authorize the execution and delivery by it
of this Agreement, and this Agreement will be executed and delivered by
one of its officers who is duly authorized to execute and deliver this
Agreement on its behalf.
(c) Binding Obligation. This Agreement constitutes a legal, valid
and binding obligation of the Administrator, enforceable in accordance
with its terms, subject to applicable bankruptcy, insolvency,
reorganization and similar laws relating to creditors' rights generally
and subject to general principles of equity.
(d) No Violation. The consummation of the transactions contemplated
by this Agreement and the fulfillment of the terms hereof or thereof do
not conflict with, result in any breach of any of the terms and
provisions of, nor constitute (with or without notice or lapse of time or
both) a default under, the charter or by-laws of the Administrator, or
any material indenture, agreement or other instrument to which the
Administrator is a party or by which it shall be bound; or result in the
creation or imposition of any Lien upon any of its material properties
pursuant to the terms of any such indenture, agreement or other
instrument; or violate any law or, to the knowledge of the Administrator,
any order, rule or regulation applicable to the Administrator of any
court or of any federal or state regulatory body, administrative agency
or other governmental instrumentality having jurisdiction over the
Administrator or its properties.
(e) No Proceedings. There are no proceedings or investigations
pending against the Administrator or, to its best knowledge, threatened
against the Administrator, before any court, regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Administrator or its properties: (i) asserting the
invalidity of this Agreement, the Indenture or any of the other Basic
Documents to which the Administrator is a party, (ii) seeking to prevent
the issuance of the Notes or the consummation of any of the transactions
contemplated by this Agreement, the Indenture or any of the other Basic
Documents, (iii) seeking any determination or ruling that could
reasonably be expected to have a material and adverse effect on the
performance by the Administrator of its obligations under, or the
validity or enforceability of, this Agreement, the Indenture, any of the
other Basic Documents or the Notes or (iv) seeking to affect adversely
the federal or state income tax attributes of the Issuer or the Notes.
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(f) All Consents. All authorizations, consents, licenses, orders or
approvals of or registrations or declarations with any court, regulatory
body, administrative agency or other government instrumentality required
to be obtained, effected or given by the Administrator in connection with
the execution and delivery by the Administrator of this Agreement and the
performance by the Administrator of its duties as contemplated by this
Agreement have in each case been duly obtained, effected or given and are
in full force and effect.
Section 2. Duties of the Administrator.
(a) Duties with Respect to the Basic Documents. The Administrator
shall perform all its duties as Administrator and the duties of the Issuer
under the Basic Documents. In addition, the Administrator shall consult with
the Eligible Lender Trustee as the Administrator deems appropriate regarding
the duties of the Issuer under the Basic Documents. The Administrator shall
monitor the performance of the Issuer and shall advise the Eligible Lender
Trustee when action is necessary to comply with the Issuer's duties under the
Basic Documents. The Administrator shall prepare for execution by the Issuer
or shall cause the preparation by other appropriate Persons of all such
documents, reports, filings, instruments, certificates and opinions as it
shall be the duty of the Issuer to prepare, file or deliver pursuant to the
Basic Documents. In furtherance of the foregoing, the Administrator shall take
all appropriate action that is the duty of the Issuer to take pursuant to the
Indenture, including such of the foregoing as are required with respect to the
following matters (references below in this subsection (a) being to sections
of the Indenture):
(A) the duty to cause the Note Registrar to keep the Note Register
and to give the Indenture Trustee prompt notice of any appointment of a
new Note Registrar and the location, or change in location, of the Note
Register (Section 2.04);
(B) the fixing or causing to be fixed of any specified record date
and the timely notification of the Indenture Trustee and Noteholders with
respect to special payment dates, if any (Section 2.07(c));
(C) the preparation of or obtaining of the documents and instruments
required for authentication of the Notes and delivery of the same to the
Indenture Trustee (Section 2.02);
(D) the preparation, obtaining or filing of the instruments,
opinions and certificates and other documents required for the release of
collateral (Section 2.09);
(E) the preparation, obtaining or filing of the instruments,
opinions and certificates and other documents, if any, required for a
transfer of the Subordinate Notes (Section 2.04);
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(F) the duty to cause the Note Registrar to maintain on behalf of
the Issuer an office in the Borough of Manhattan, The City of New York,
for registration of transfer or exchange of the Notes (Section 3.02);
(G) the duty to cause newly appointed Paying Agents, if any, to
deliver to the Indenture Trustee the instrument specified in the
Indenture regarding funds held in trust (Section 3.03);
(H) the direction to the Paying Agents to deposit moneys with the
Indenture Trustee (Section 3.03);
(I) the obtaining and preservation of the Issuer's qualification to
do business in each jurisdiction in which such qualification is or shall
be necessary to protect the validity and enforceability of the Indenture,
the Notes, the Collateral and each other instrument and agreement
included in the Indenture Trust Estate (Section 3.04);
(J) the preparation of all supplements, amendments, financing
statements, continuation statements, instruments of further assurance and
other instruments, in accordance with Section 3.05 of the Indenture,
necessary to protect the Indenture Trust Estate (Section 3.05);
(K) the delivery by the Issuer of the Opinion of Counsel on the
Closing Date and the annual delivery of Opinions of Counsel, in
accordance with Section 3.06 of the Indenture, as to the Indenture Trust
Estate, and the annual delivery of the Officers' Certificate of the
Issuer and certain other statements, in accordance with Section 3.09 of
the Indenture, as to compliance with the Indenture (Sections 3.06 and
3.09);
(L) the identification to the Indenture Trustee in an Officers'
Certificate of the Issuer of a Person with whom the Issuer has contracted
to perform its duties under the Indenture (Section 3.07(b));
(M) the notification of the Indenture Trustee and the Rating
Agencies of any Servicer Default pursuant to the Servicing Agreement of
which a Responsible Officer of the Administrator has knowledge and, if
such Servicer Default arises from the failure of the Servicer to perform
any of its duties under the Servicing Agreement, the taking of all
reasonable steps available to remedy such failure (Section 3.07(d));
(N) the preparation and obtaining of documents and instruments
required for the release of the Issuer from its obligations under the
Indenture (Section 3.10);
(O) the prompt delivery of notice to the Indenture Trustee and the
Rating Agencies of each Event of Default, any Default under Section
5.01(iii) of the Indenture and each default by the Servicer under the
Servicing Agreement or by the Seller under the Loan Sale Agreement of
which a Responsible Officer of the Administrator has knowledge (Section
3.18);
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(P) the monitoring of the Issuer's obligations as to the
satisfaction and discharge of the Indenture and the preparation of an
Officers' Certificate of the Issuer and the obtaining of the Opinion of
Counsel and the Independent Certificate relating thereto (Section 4.01);
(Q) the compliance with any written directive of the Indenture
Trustee with respect to the sale of the Indenture Trust Estate in a
commercially reasonable manner if an Event of Default shall have occurred
and be continuing (Section 5.04);
(R) the preparation of any written instruments required to confirm
more fully the authority of any co-trustee or separate trustee and any
written instruments necessary in connection with the resignation or
removal of any co-trustee or separate trustee (Sections 6.08 and 6.10);
(S) the furnishing of the Indenture Trustee with the names and
addresses of Noteholders during any period when the Indenture Trustee is
not the Note Registrar (Section 7.01);
(T) the preparation and, after execution by the Issuer, the filing
with the Commission, any applicable State agencies and the Indenture
Trustee of documents required to be filed on a periodic basis with, and
summaries thereof as may be required by rules and regulations prescribed
by, the Commission and any applicable State agencies and the transmission
of such summaries to the Noteholders (Section 7.03);
(U) the opening of one or more accounts in the Issuer's name, the
preparation of Issuer Orders, Officers' Certificates of the Issuer and
Opinions of Counsel and all other actions necessary with respect to
investment and reinvestment of funds in the Trust Accounts (Sections 8.02
and 8.03);
(V) the preparation of an Issuer Request and Officers' Certificate
of the Issuer and the obtaining of an Opinion of Counsel and Independent
Certificates, if necessary, for the release of the Indenture Trust Estate
(Sections 8.04 and 8.05);
(W) the preparation of Issuer Orders and the obtaining of Opinions
of Counsel with respect to the execution of supplemental indentures and
the mailing to the Noteholders, each Rating Agency and the Swap
Counterparty of notices with respect to such supplemental indentures
(Sections 9.01, 9.02 and 9.03);
(X) the preparation of or obtaining of the documents and instruments
required for the execution and authentication of new Notes conforming to
any supplemental indenture and the delivery of the same to the Eligible
Lender Trustee and the Indenture Trustee, respectively (Section 9.06);
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(Y) the notification of Noteholders and the Swap Counterparty of
redemption of the Notes or the duty to cause the Indenture Trustee to
provide such notification (Section 10.02);
(Z) the preparation of all Officers' Certificates of the Issuer,
Opinions of Counsel and Independent Certificates with respect to any
requests by the Issuer to the Indenture Trustee to take any action under
the Indenture (Section 11.01(a));
(AA) the preparation and delivery of Officers' Certificates of the
Issuer and the obtaining of Independent Certificates, if necessary, for
the release of property from the lien of the Indenture (Section
11.01(b));
(BB) the preparation and timely delivery to Noteholders and the
Indenture Trustee of any agreements with respect to alternate payment and
notice provisions (Section 11.06);
(CC) the recording of the Indenture, if applicable (Section 11.14);
(DD) the duty to obtain a new servicer as Successor Servicer and to
enter into an agreement with such Successor Servicer (Section 3.07(e));
(EE) the notification of the termination of the Servicer and the
appointment of a Successor Servicer (Section 3.07(f));
(FF) the duty to cause the Servicer to comply with the Servicing
Agreement (Section 3.14); and
(GG) the delivery of all documents and opinions to be provided by
the Issuer under Part 3 of the Swap Agreement, performing all obligations
of the Issuer under Part 5(b) of the Swap Agreement, and providing all
notices and consents required by the Issuer under the Swap Agreement.
The Issuer hereby appoints the Administrator as the initial Paying Agent.
(b) Duties with Respect to the Issuer. (i) In addition to the duties
of the Administrator set forth above and in the other Basic Documents, the
Administrator shall perform such calculations and shall prepare for execution
by the Issuer or the Eligible Lender Trustee or shall cause the preparation by
other appropriate Persons of all such documents, reports, filings,
instruments, certificates and opinions as it shall be the duty of the Issuer
or the Eligible Lender Trustee to prepare, file or deliver pursuant to the
Basic Documents, and at the request of the Eligible Lender Trustee shall take
all appropriate action that it is the duty of the Issuer to take pursuant to
the Basic Documents. In furtherance thereof, the Eligible Lender Trustee
shall, on behalf of itself and of the Issuer, execute and deliver to the
Administrator and to each successor Administrator appointed pursuant to the
terms hereof, one or more powers of attorney substantially in the form of
Exhibit A hereto, appointing the Administrator the attorney-in-fact of
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the Eligible Lender Trustee and the Issuer for the purpose of executing on
behalf of the Eligible Lender Trustee and the Issuer all such documents,
reports, filings, instruments, certificates and opinions. Subject to Section 9
of this Agreement, and in accordance with the directions of the Eligible
Lender Trustee, the Administrator shall administer, perform or supervise the
performance of such other activities in connection with the Collateral
(including the Basic Documents) as are not covered by any of the foregoing
provisions and as are expressly requested by the Eligible Lender Trustee and
are reasonably within the capability of the Administrator. Upon the request of
the Administrator, the Servicer shall perform any of the obligations of the
Administrator set forth in this Section 2(b)(i) that the Administrator would
otherwise be required to perform from time to time.
Prior to each Determination Date immediately preceding a Quarterly
Payment Date, the Administrator shall determine, the Class A-1 Note Rate, the
Class A-2 Note Rate and the Subordinate Note Rate that will be applicable to
the Quarterly Payment Date following such Determination Date. In connection
therewith, the Administrator shall calculate Three-Month LIBOR, the Class A-1
Note Rate, the Class A-2 Note Rate and the Subordinate Note Rate in accordance
with the respective definitions thereof.
(ii) Notwithstanding anything in this Agreement or the Basic
Documents to the contrary, the Administrator shall be responsible for the
performance of the duties of the Eligible Lender Trustee set forth in Section
5.02 of the Trust Agreement with respect to, among other things, any tax
information or accounting report required to be distributed to Note Owners.
(iii) The Administrator shall perform the duties of the
Administrator specified in Sections 10.02 and 10.03 of the Trust Agreement
required to be performed in connection with the resignation or removal of the
Eligible Lender Trustee and the appointment of a successor Eligible Lender
Trustee, and any other duties expressly required to be performed by the
Administrator under the Trust Agreement and the other Basic Documents,
including those under Section 6.08 of the Indenture.
(iv) As described in Article IX of the Trust Agreement, notice of
any termination of the Trust shall be given by the Administrator to the
Eligible Lender Trustee, the Indenture Trustee and the Swap Counterparty as
soon as practicable after the Administrator has received notice thereof.
(v) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Administrator may enter into
transactions with or otherwise deal with any of its Affiliates; provided,
however, that the terms of any such transactions or dealings shall be in
accordance with any directions received from the Issuer and shall be, in the
Administrator's opinion, no less favorable to the Issuer or the Noteholders
than would be available from unaffiliated parties.
(c) Establishment and Maintenance of Trust Accounts.
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(i) The Administrator, for the benefit of the Issuer, shall
establish and maintain an Eligible Deposit Account in the name of the
Indenture Trustee, for the benefit of the Noteholders (the "Collection
Account").
(ii) The Administrator shall establish and maintain an Eligible
Deposit Account in the name of the Indenture Trustee, for the benefit of the
Noteholders (the "Reserve Account"). In the event the entire amount
outstanding under the Demand Note is drawn on pursuant to Section 2(e)(vi)
hereof, the Administrator shall establish and maintain an Eligible Deposit
Account in the name of the Indenture Trustee for the benefit of the
Noteholders (the "Demand Note Account").
(iii) The Administrator, for the benefit of the Noteholders, if
there are funds to be deposited in a prefunding account, shall establish and
maintain an Eligible Deposit Account in the name of the Indenture Trustee, for
the benefit of the Noteholders (the "Prefunding Account").
(iv) The Trust Accounts will initially be established as a
segregated trust account in the name of the Indenture Trustee with the
corporate trust department of the Administrator. Funds on deposit in the
Collection Account, the Reserve Account, the Demand Note Account and the
Prefunding Account (collectively, the "Trust Accounts") shall be invested by
the Administrator (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 Servicer; provided, however, it is understood and
agreed that the Administrator 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; provided, however, that on the Business Day
preceding each Monthly Payment Date all interest and other investment income
(net of losses and investment expenses) on funds on deposit therein (other
than with respect to any amounts on deposit in the Demand Note Account) shall
be deposited into the Collection Account and shall be deemed to constitute a
portion of the Monthly Available Funds for each Monthly Payment Date that is
not a Quarterly Payment Date, and a portion of the Available Funds for each
Quarterly Payment Date. Other than as permitted in writing by the Rating
Agencies, funds on deposit in the Trust Accounts shall be invested in Eligible
Investments that will mature so that funds sufficient to pay the Servicing Fee
(and all other amounts payable on a Quarterly Payment Date) will be available
in the Collection Account on the Business Day preceding each Monthly Payment
Date that is not a Quarterly Payment Date, so that funds on deposit in the
Prefunding Account that are required, in the judgment and at the discretion of
the Servicer, to make Additional Fundings during the Funding Period will be
available for such purpose and so that the remaining such funds will be
available at the close of business on the Business Day preceding each
Quarterly Payment Date. Any investment income (net of losses and investment
expenses) on any amounts on deposit in the Demand Note Account shall be
remitted on each Quarterly Payment Date to the Demand Note Provider.
(v) (A) 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
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income shall be part of the Trust Estate. 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 10 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 Administrator agrees
that, in the event that any of the Trust Accounts are not accounts with the
Indenture Trustee, the Administrator shall notify the Indenture Trustee in
writing promptly upon any of such Trust Accounts ceasing to be an Eligible
Deposit Account.
(B) With respect to the Trust Account Property, the Indenture
Trustee agrees, by its acceptance hereof, that:
(1) any Trust Account Property that is held in deposit accounts
shall be held solely in Eligible Deposit Accounts, subject to the
next to the last sentence of clause (v)(A) above; and 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;
(2) any Trust Account Property that constitutes Physical
Property shall be Delivered to the Indenture Trustee in accordance
with paragraph (a) of the definition of "Delivery";
(3) any Trust Account Property that is a book-entry security
held through the Federal Reserve System pursuant to Federal
book-entry regulations shall be Delivered in accordance with
paragraph (b) of the definition of "Delivery"; and
(4) any Trust Account Property that is an "uncertificated
security" under Article VIII of the UCC and that is not governed by
clause (3) above shall be Delivered to the Indenture Trustee in
accordance with paragraph (c) of the definition of "Delivery".
(C) The Administrator shall have the power, revocable for cause or
upon the occurrence and during the continuance of an Administrator
Default by the Indenture Trustee or by the Eligible Lender Trustee with
the consent of the Indenture Trustee, to instruct the Indenture Trustee
to make withdrawals and payments from the Trust Accounts for the purpose
of permitting the Servicer or the Eligible Lender Trustee to carry out
their respective duties under the Servicing Agreement and the Trust
Agreement, permitting the Indenture Trustee to carry out its duties under
the Indenture and withdrawing any amounts deposited in error into such
accounts.
(vi) On each Determination Date, the Servicer shall calculate all
amounts required to determine the amounts to be deposited in the
Collection Account and the other Trust
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Accounts and the amounts to be distributed therefrom on the related Monthly
Payment Date, Quarterly Payment Date or other dates from which amounts therein
are to be distributed.
(d) Withdrawals from the Collection Account. The Servicer shall
instruct the Administrator, on behalf of the Indenture Trustee, in writing
(based, in the case of clauses (iv) and (v) below, on the information
contained in the Servicer's report delivered with respect to the applicable
Determination Date pursuant to Section 3.07 of the Servicing Agreement) to
make withdrawals from amounts deposited in the Collection Account at the
following times and for the following purposes, and the Administrator shall
comply with such instructions:
(i) Reserved.
(ii) from time to time during each Collection Period to pay the
Department any Consolidation Fees due and payable to the Department, to the
extent such Consolidation Fees are not being deducted by the Department out of
Special Allowance Payments or Interest Subsidy Payments;
(iii)
(A) on each Add-on Consolidation Loan Funding Date after the Funding
Period, to prepay in full any Add-on Consolidation Loan pursuant to
Section 6.07 of the Trust Agreement; provided, however, that the amount
paid to prepay any Add-on Consolidation Loan on any date since the
preceding Quarterly Payment Date shall not exceed the Net Principal Cash
Flow Amount for such date minus the aggregate Loan Purchase Amount
remitted for the purchase of Serial Loans on each Transfer Date since the
preceding Quarterly Payment Date after the Funding Period pursuant to
Section 2(d)(iii)(B); and
(B) on each Transfer Date after the Funding Period and on or prior
to October 30, 2003, to pay to the Depositor, pursuant to Section 2.02 of
the Loan Sale Agreement, the aggregate Loan Purchase Amount for Serial
Loans purchased by the Eligible Lender Trustee on behalf of the Issuer on
such date; provided that the amount paid to the Seller for the purchase
of Serial Loans on such Transfer Date plus the amount of funds remitted
for the purchase of Serial Loans on each Transfer Date since the
preceding Quarterly Payment Date on any Transfer Date after the Funding
Period shall not exceed the Net Principal Cash Flow Amount for such
Transfer Date minus the sum of (i) all amounts paid since the last
Quarterly Payment Date pursuant to Section 2(d)(iii)(A) to prepay any
Add-on Consolidation Loan not held by the Issuer and (ii) all amounts
which the Administrator reasonably estimates will be required to prepay
Add-on Consolidation Loans pursuant to Section 2(d)(iii)(A) during the
remainder of the Collection Period;
(iv) on each Monthly Payment Date that is not a Quarterly Payment
Date, to pay to the Servicer, the Servicing Fee with respect to the preceding
calendar month and all unpaid Servicing Fees from prior months by 11:00 a.m.
(New York time), to the extent of Monthly Available Funds for such Monthly
Payment Date in the Collection Account.
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(v) on each Quarterly Payment Date, to make the following deposits
and distributions to the Persons or the account specified below by 11:00 a.m.
(New York time), to the extent of Available Funds for such Quarterly Payment
Date in the Collection Account, in the following order of priority:
(A) to the Servicer, the Servicing Fee with respect to the preceding
calendar month and all unpaid Servicing Fees from prior months;
(B) to the Administrator, from the amount of the Available Funds
remaining after the application of clause (A), the Administration Fee
with respect to the preceding Collection Period and all unpaid
Administration Fees from prior Collection Periods;
(C) to the Swap Counterparty, from the amount of Available Funds
remaining after the application of clauses (A) and (B), the Swap Fee with
respect to the preceding Collection Period and all unpaid Swap Fees from
prior Collection Periods;
(D) to the Indenture Trustee for distribution pursuant to Section
8.02(c) of the Indenture, in the following order of priority, from the
amount of the Available Funds remaining after the application of clauses
(A) through (C): (i) the Class A-1 Noteholders' Interest Distribution
Amount and the Class A-2 Noteholders' Interest Distribution Amount, pro
rata, based on the ratio of each such amount to the total of such
amounts; (ii) the Subordinate Noteholders' Interest Distribution Amount;
(iii) the Senior Noteholders' Principal Distribution Amount; and (iv) the
Subordinate Noteholders' Principal Distribution Amount, each with respect
to such Quarterly Payment Date; and
(E) to the Reserve Account, the amount of Available Funds remaining
after the application of clauses (A) through (D).
Except in the case of amounts deposited into the Reserve Account
pursuant to clause (v)(E) of this Section 2(d), amounts properly calculated,
reported and withdrawn from the Collection Account and properly distributed
pursuant to this Section 2(d) in accordance with the terms hereof shall be
deemed released from the Trust Estate and the security interest therein
granted to the Indenture Trustee, and the Persons to whom such amounts are
distributed shall in no event be required to refund any such distributed
amounts.
(e) Reserve Account and Demand Note.
(i) The Depositor shall deposit the Reserve Account Initial Deposit
into the Reserve Account as required by Section 2.01(c) of the Loan Sale
Agreement.
(ii) With respect to any amount in the Reserve Account on any
Quarterly Payment Date (after giving effect to all deposits thereto on such
Quarterly Payment Date and to all withdrawals therefrom necessary to make the
distributions required to be made from the Available Funds on such Quarterly
Payment Date) in excess of the Specified Reserve Account Balance for such
Quarterly Payment Date (the "Reserve Account Excess"), the Servicer shall
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instruct the Administrator, on behalf of the Indenture Trustee, to apply such
Reserve Account Excess to the following (in the priority indicated): (i) if
such Quarterly Payment Date is on or prior to the Parity Date (after
application of all other amounts paid to the Noteholders on such Quarterly
Payment Date, including the application of funds in the Prefunding Account),
to pay to the Indenture Trustee for distribution to Noteholders pursuant to
Section 8.02(d) of the Indenture an amount equal to the lesser of (x) the
remaining amount of such excess and (y) the amount by which the aggregate
principal amount of the Notes, after giving effect to all other distributions
in respect of principal of the Notes on such Quarterly Payment Date, exceeds
the sum of the Pool Balance plus the amount on deposit in the Prefunding
Account as of the close of business on the last day of the related Collection
Period and plus the amount on deposit in the Reserve Account (up to an amount
equal to the Specified Reserve Account Balance) as of such Quarterly Payment
Date; (ii) to the Swap Counterparty, all amounts other than the Swap Fee and
any overdue Swap Fees that are then due and payable to the Swap Counterparty
under the Swap Agreement; (iii) to reimburse the Demand Note Provider in
respect of any unreimbursed draws made on the Demand Note, or if the Demand
Note has been drawn on pursuant to Section 2(e)(vi), to deposit such
reimbursement amount in the Demand Note Account; (iv) to pay to the Indenture
Trustee for distribution to Noteholders pursuant to Section 8.02(d) of the
Indenture an amount equal to the lesser of (x) the remaining amount of such
excess and (y) the amount that, when paid as principal of the Notes, will
cause (I) the sum of the Pool Balance plus the amount on deposit in the
Prefunding Account as of the close of business on the last day of the related
Collection Period and plus the amount on deposit in the Reserve Account (up to
an amount equal to the Specified Reserve Account Balance) as of such Quarterly
Payment Date to equal (II) 100.50% of the aggregate principal amount of the
Notes, after giving effect to all other distributions in respect of principal
of the Notes on such Quarterly Payment Date; and (v) any remaining amount of
such excess, after application of clauses (i) through (iv) above will be
released to the Depositor. Amounts properly calculated, reported and
distributed pursuant to this Section 2(e)(ii) shall be deemed released from
the Trust Estate and the security interest therein granted to the Indenture
Trustee, and the Seller and the Depositor shall in no event thereafter be
required to refund any such distributed amounts.
(iii) Following the payment in full of the aggregate outstanding
principal amount of the Notes and of all other amounts owing or to be
distributed hereunder or under the Indenture to Noteholders, the Seller, the
Servicer or the Administrator and the termination of the Trust, any amount
remaining on deposit in the Reserve Account shall be distributed to the
Depositor. The Depositor shall in no event be required to refund any amounts
properly calculated, reported and distributed pursuant to this Section
2(e)(iii).
(iv)
(A) In the event that the Servicing Fee plus any overdue Servicing
Fees for any Monthly Payment Date exceeds the amount distributed to the
Servicer pursuant to Sections 2(d)(iv) or 2(d)(v)(A) on such Monthly
Payment Date, the Servicer shall instruct the Administrator, on behalf of
the Indenture Trustee, to withdraw from the Reserve Account (or to the
extent the amount in the Reserve Account has been or is thereby
12
reduced to zero and such date is on or prior to the Demand Note
Expiration Date, shall instruct the Indenture Trustee to draw on the
Demand Note or, if a draw on the Demand Note had been made pursuant to
Section 2(e)(vi), shall instruct the Administrator to withdraw from the
Demand Note Account) on such Monthly Payment Date an amount equal (in the
aggregate) to such excess and to distribute such amount to the Servicer.
(B) For any Quarterly Payment Date, in the event that the
Administration Fee plus any overdue Administration Fees for such
Quarterly Payment Date exceeds the amount distributed to the
Administrator pursuant to Section 2(d)(v)(B) on such Quarterly Payment
Date, the Servicer shall instruct the Administrator, on behalf of the
Indenture Trustee, to withdraw from the Reserve Account (or to the extent
the amount in the Reserve Account has been or is thereby reduced to zero
and such date is on or prior to the Demand Note Expiration Date, shall
instruct the Indenture Trustee to draw on the Demand Note or, if a draw
on the Demand Note had been made pursuant to Section 2(e)(vi), shall
instruct the Administrator to withdraw from the Demand Note Account) on
such Quarterly Payment Date an amount equal (in the aggregate) to such
excess, to the extent of funds available for such withdrawal or draw
after giving effect to paragraph (iv)(A) above, and to distribute such
amount to the Administrator.
(C) For any Quarterly Payment Date, in the event that the Swap Fee
plus any overdue Swap Fees for such Quarterly Payment Date exceeds the
amount distributed to the Swap Counterparty pursuant to Section
2(d)(v)(C) on such Quarterly Payment Date, the Servicer shall instruct
the Administrator, on behalf of the Indenture Trustee, to withdraw from
the Reserve Account (or to the extent the amount in the Reserve Account
has been (or is thereby) reduced to zero and such date is on or prior to
the Demand Note Expiration Date, shall instruct the Indenture Trustee to
draw on the Demand Note or, if a draw on the Demand Note had been made
pursuant to Section 2(e)(vi), shall instruct the Administrator to
withdraw from the Demand Note Account) on such Quarterly Payment Date an
amount equal (in the aggregate) to such excess, to the extent of funds
available for such withdrawal or draw after giving effect to paragraphs
(iv)(A) and (iv)(B) above, and to distribute such amount to the Swap
Counterparty.
(D) For any Quarterly Payment Date, in the event that (x) the
Noteholders' Interest Distribution Amount for such Quarterly Payment Date
plus, on the Final Maturity Date for any Class of Notes, the outstanding
principal balance of such Class of Notes immediately prior to such
Quarterly Payment Date, exceeds (y) the amount distributed to the
Indenture Trustee for distribution to the Noteholders pursuant to Section
2(d)(v)(D) on such Quarterly Payment Date, the Servicer shall instruct
the Administrator, on behalf of the Indenture Trustee, to withdraw from
the Reserve Account (or to the extent the amount in the Reserve Account
has been (or is thereby) reduced to zero and such date is on or prior to
the Demand Note Expiration Date, shall instruct the Indenture Trustee to
draw on the Demand Note or, if a draw on the Demand Note had been made
pursuant to Section 2(e)(vi), shall instruct the Administrator to
withdraw from the Demand Note Account) on such Quarterly Payment Date an
amount equal (in the
13
aggregate) to such excess, to the extent of funds available for such
withdrawal or draw after giving effect to paragraphs (iv)(A), (iv)(B) and
(iv) (C) above, and to distribute such amount as required by Section
2(d)(v)(D) on such Quarterly Payment Date.
(v) On the Closing Date, the Depositor has Granted the Demand Note
to the Indenture Trustee pursuant to the Indenture.
(vi) If, prior to the Demand Note Expiration Date, (A) the
short-term unsecured debt rating of the Demand Note Provider (or its
implied short-term unsecured debt rating based on the ratings assigned to
an affiliate of the Demand Note Provider) falls below "A-1" by S&P, "P-1"
by Xxxxx'x or "F-1" by Fitch or if the Demand Note Provider's long-term
unsecured debt rating (or its implied long-term unsecured debt rating
based on the ratings assigned to an affiliate of the Demand Note
Provider) falls below "A-" by S&P, "A2" by Xxxxx'x or "A" by Fitch and
(B) within 30 days of the withdrawal or reduction, each Rating Agency
that has withdrawn or reduced such rating has not confirmed the ratings
assigned by it to the Notes on the Closing Date, then the Servicer shall
instruct the Indenture Trustee to demand payment of the entire undrawn
amount of the Demand Note and deposit that amount into the Demand Note
Account. On the Demand Note Expiration Date, all amounts on deposit in
the Demand Note Account, after giving effect to any withdrawals therefrom
pursuant to Section 2(e)(iv) on such date, will be paid over to the
Demand Note Provider free and clear.
(vii) As the close of business on the Demand Note Expiration Date,
the Demand Note shall be surrendered to the Demand Note Provider for
cancellation.
(f) Prefunding Account.
(i) During the Funding Period, the Servicer shall instruct the
Administrator, on behalf of the Indenture Trustee, in writing to withdraw from
the Prefunding Account, in each case to the extent of the funds on deposit
therein (A) on each Transfer Date, an amount equal to the Loan Purchase Amount
for the Serial Loans transferred to the Eligible Lender Trustee on behalf of
the Issuer on such Transfer Date and to distribute such amount to or upon the
order of the Seller upon satisfaction of the conditions set forth in Section
2.02 of the Loan Sale Agreement with respect to such transfer, (B) when and as
requested by the Eligible Lender Trustee, in order to facilitate its
origination of Consolidation Loans, to transfer to the order of the Eligible
Lender Trustee an amount, sufficient to prepay in full any Student Loan that
is to be consolidated through such origination with one or more Financed
Student Loans, and (C) when and as requested by the Eligible Lender Trustee,
in order to facilitate its funding of the addition of the principal balance of
any Add-on Consolidation Loan to the principal balance of a Consolidation
Loan, an amount sufficient to prepay in full such Add-on Consolidation Loan.
(ii) On the Quarterly Payment Date on or next occurring after the
termination of the Funding Period, the Servicer shall instruct the
Administrator on behalf of the Indenture Trustee, to withdraw from the
Prefunding Account on such Quarterly Payment Date an amount equal to the
entire remaining amount on deposit in such account and to distribute such
amount pursuant to Section 8.02(e) of the Indenture.
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(iii) On the Closing Date, the Seller shall deposit the Prefunding
Account Closing Date Deposit into the Prefunding Account as required by
Section 2.01(c) of the Loan Sale Agreement.
(g) Statements to Noteholders.
(i) On each Determination Date preceding a Quarterly Payment Date,
the Servicer shall provide to the Administrator, the Indenture Trustee, the
Swap Counterparty (with a copy to the Rating Agencies) for the Administrator
to forward on such succeeding Quarterly Payment Date to each Noteholder of
record a statement substantially in the form of Exhibit B setting forth at
least the following information as to the Notes:
(A) the amount of such distribution allocable to principal of the
Notes, the amount thereof distributable as principal of the Class A-1
Notes, the Class A-2 Notes and the Subordinate Notes, and the amount
thereof attributable to the Principal Distribution Amount and the amount
thereof attributable to Reserve Account Excess;
(B) the amount of the distribution allocable on such Quarterly
Payment Date to interest on the Class A-1 Notes;
(C) the amount of the distribution allocable on such Quarterly
Payment Date to interest on the Class A-2 Notes;
(D) the amount of the distribution allocable on such Quarterly
Payment Date to interest on the Subordinate Notes;
(E) the Pool Balance as of the close of business on the last day of
the preceding Collection Period, after giving effect to payments
allocated to principal reported under clause (A) above;
(F) the aggregate outstanding principal amount of the Class A-1
Notes, the Class A-2 Notes, the Subordinate Notes, the Class A-1 Note
Pool Factor, the Class A-2 Note Pool Factor and the Subordinate Note Pool
Factor as of such Quarterly Payment Date, after giving effect to payments
allocated to principal reported under clause (A) above;
(G) the Note Rate applicable with respect to each distribution
referred to in clauses (B), (C) and (D) above;
(H) the amount of the Servicing Fee paid to the Servicer on such
Quarterly Payment Date and on each Monthly Payment Date following the
immediately preceding Quarterly Payment Date including a breakdown of the
components of the Servicing Fee attributable to each of the items
specified in Section 3.06 of the Servicing Agreement and for each Monthly
Payment Date following the immediately preceding Quarterly Payment Date;
15
(I) the amount of the Administration Fee paid to the Administrator
on such Quarterly Payment Date;
(J) the amount of the Swap Fee paid to the Swap Counterparty on such
Quarterly Payment Date and the amount of any other payments made to the
Swap Counterparty on such Quarterly Payment Date;
(K) the amount of the aggregate Realized Losses, if any, for such
Collection Period and the balance of Financed Student Loans that are
delinquent in each delinquency period as of the end of such Collection
Period;
(L) the balance of the Reserve Account on such Quarterly Payment
Date, after giving effect to changes therein on such Quarterly Payment
Date and indicating whether on such Quarterly Payment Date or any Monthly
Payment Date since the preceding Quarterly Payment Date any withdrawal
was made therefrom pursuant to Section 2(e)(iv), the amount of each such
withdrawal and the purpose(s) pursuant to Section 2(e)(iv) for each such
withdrawal;
(M) for each Quarterly Payment Date on or prior to the expiration of
the Demand Note, either (i) the balance of the Demand Note on such
Quarterly Payment Date, after giving effect to draws or repayments
thereon on such Quarterly Payment Date and indicating whether on such
Quarterly Payment Date or any Monthly Payment Date since the preceding
Quarterly Payment Date any draw was made thereon pursuant to Section
2(e)(iv), the amount of each such draw and the purpose(s) pursuant to
Section 2(e)(iv) for each such draw, or (ii) if a draw has been made on
the Demand Note pursuant to Section 2(e)(vi), the balance of the Demand
Note Account on such Quarterly Payment Date, after giving effect to
changes therein on such Quarterly Payment Date and indicating whether on
such Quarterly Payment Date or any Monthly Payment Date since the
preceding Quarterly Payment Date any withdrawal was made therefrom
pursuant to Section 2(e)(iv), the amount of each such withdrawal and the
purpose(s) pursuant to Section 2(e)(iv) for each such withdrawal;
(N) for Quarterly Payment Dates during the Funding Period, the
amount on deposit in the Prefunding Account as of the last day of the
related Collection Period and indicating the amount of withdrawals
therefrom during such Collection Period pursuant each of clauses (A), (B)
and (C) of Section 2(f)(i);
(O) for the Quarterly Payment Date on or immediately following the
end of the Funding Period, the amount remaining on deposit in the
Prefunding Account that has not been used to make Additional Fundings;
(P) (i) the principal balance and number of Consolidation Loans
originated on behalf of the Issuer during the related Collection Period,
(ii) the principal balance and number of Add-on Consolidation Loans the
principal balances of which have been added to the Trust during the
related Collection Period and (iii) the amount withdrawn from the
16
Prefunding Account to prepay Student Loans not held by the Issuer that
were consolidated through such origination (or addition, in the case of
Add-on Consolidation Loans) with one or more Financed Student Loans
during such Collection Period;
(Q) the principal balance and number of Serial Loans conveyed to the
Issuer during the related Collection Period, the aggregate Loan Purchase
Amounts thereof; and
(R) the number and principal balance of Financed Student Loans, as
of the end of the related Collection Period, that are In-School, Grace,
Repayment, Deferral, Forbearance or Consolidation Loans as of the end of
the related Collection Period, and a breakdown by number and principal
balance of Financed Student Loans, by school type, interest rate and loan
program.
Each amount set forth pursuant to clauses (A), (B), (C) and (D) above shall be
expressed as a dollar amount per $1,000 of original principal amount 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. The Administrator shall be under no obligations to verify,
recalculate or recompute the information it receives pursuant to this Section
2(g).
(h) Non-Ministerial Matters. With respect to matters that in the
reasonable judgment of the Administrator are non-ministerial, the
Administrator shall not take any action unless within a reasonable time before
the taking of such action, the Administrator shall have notified the Eligible
Lender Trustee of the proposed action and the Eligible Lender Trustee shall
have consented to it. For the purpose of the preceding sentence,
"non-ministerial matters" shall include, without limitation:
(i) the amendment of or any supplement to the Indenture;
(ii) the initiation of any claim or lawsuit by the Issuer and the
compromise of any action, claim or lawsuit brought by or against the Issuer
(other than in connection with the collection of the Financed Student Loans);
(iii) the amendment, change or modification of the Basic Documents;
(iv) the appointment of successor Note Registrars, successor Paying
Agents and successor Indenture Trustees pursuant to the Indenture or the
appointment of successor Administrators or Successor Servicers, or the consent
to the assignment by the Note Registrar, Paying Agent or Indenture Trustee of
its obligations under the Indenture;
(v) the removal of the Indenture Trustee;
(vi) the involvement in any lawsuit or other legal action against
the Indenture Trustee, including without limitation, consenting to the
settlement of any third party claim by the Indenture Trustee;
17
(vii) any actions related to the removal of the Eligible Lender
Trustee;
(viii) any non-ministerial action that the Issuer is entitled but
not obligated to take under the Basic Documents;
(ix) the preparation or delivery of any compliance certificate,
officers' certificate or opinion of counsel on behalf of the Issuer that is to
be delivered to the Indenture Trustee or upon which the Indenture Trustee is
to rely;
(x) the payment of any taxes of the Issuer or the Eligible Lender
Trustee including any amounts necessary to maintain its existence as a
business trust;
(xi) the making of any representations or warranties or covenants of
the Issuer or Eligible Lender Trustee;
(xii) any non-ministerial action related to any economic or
substantive right of interest of the Issuer or the Eligible Lender Trustee;
(xiii) the advance of funds for the purpose of allowing the
Indenture Trustee to make required payments on the Notes; and
(xiv) the recording of the Indenture, if required, pursuant to
Section 11.14 of the Indenture.
Notwithstanding anything to the contrary in this Agreement, the
Administrator shall not be obligated to, and shall not, take any action that
the Eligible Lender Trustee directs in writing that the Administrator not to
take on its behalf or on behalf of the Issuer.
(i) Swap Termination. In the event of a termination of a Swap
Agreement that requires the Trust to make a termination payment to the Swap
Counterparty, such termination payment shall be paid in the same order of
priority as the Swap Fee in Section 2(d)(v) and to the extent it exceeds the
amount of the Swap Fee for the related Quarterly Payment Date, the remainder
shall be paid pursuant to Section 2(e)(iv)(B); provided, however, that in the
event that the Trust is required to make a termination payment to a Swap
Counterparty as a result of (i) an Event of Default (as such term is defined
in the Swap Agreement) where the Swap Counterparty is the Defaulting Party (as
such term is defined in the Swap Agreement) or (ii) a Termination Event (as
such term is defined in the Swap Agreement), such termination payment will be
subordinate in priority to the right of the Class A Noteholders to receive the
Class A Noteholders' Distribution Amount and to the Subordinate Noteholders to
receive the Subordinate Noteholders' Distribution Amount and, if necessary, to
the reinstatement of the balance of the Reserve Account up to the Specified
Reserve Account Balance. In the event of a termination of a Swap Agreement
that requires the Trust to make a termination payment to the applicable Swap
Counterparty except as described in the proviso above, the Administrator
promptly shall notify the Rating Agencies of such requirement and, within
thirty (30) days of
18
such termination payment, shall provide to the Rating Agencies cash flows
and such other financial information with respect to the Trust as the
Rating Agencies may reasonably request.
Section 3. Annual Statement as to Compliance.
(a) The Administrator shall deliver to the Seller, the Eligible
Lender Trustee and the Indenture Trustee, on or before March 31 of each year
beginning 2003, an Officers' Certificate of the Administrator dated as of
December 31 of the preceding year, stating that (i) a review of the activities
of the Administrator during the preceding 12-month period (or, in the case of
the first such certificate, during the period from the Closing Date to
December 31) and of its performance under this Agreement has been made under
such officers' supervision and (ii) to the best of such officers' knowledge,
based on such review, the Administrator has fulfilled all its obligations
under this Agreement throughout such year or, if there has been a default in
the fulfillment of any such obligation, specifying each such default known to
such officers and the nature and status thereof. The Indenture Trustee shall
send a copy of each such Officer's Certificate and each report referred to in
Section 4 to the Rating Agencies. A copy of such Officers' Certificate and
each report referred to in Section 4 may be obtained by any Noteholder or Note
Owner by a request in writing to the Indenture Trustee addressed to its
Corporate Trust Office, together with evidence satisfactory to the Indenture
Trustee that such Person is one of the foregoing parties.
(b) The Administrator shall deliver to the Eligible Lender Trustee,
the Indenture Trustee, the Servicer and the Rating Agencies, promptly after
having obtained knowledge thereof, but in no event later than two Business
Days thereafter, written notice in an Officers' Certificate of the
Administrator of any event which with the giving of notice or lapse of time,
or both, would become an Administrator Default under Section 12.
Section 4. [Reserved.]
Section 5. Administrator Expenses. The Administrator shall be
required to pay all and customary ordinary out-of-pocket expenses incurred by
it in connection with its activities hereunder, including expenses incurred in
connection with distributions and reports to the Noteholders. Any other
amounts representing expenses incurred by the Administrator in connection with
its activities hereunder shall be reimbursed to the Administrator by the
Servicer at the Administrator's request.
Section 6. Records. The Administrator shall maintain appropriate
books of account and records relating to services performed hereunder, which
books of account and records shall be accessible for inspection by the Issuer
at any time during normal business hours.
Section 7. Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement and as reimbursement for its
expenses related thereto, the Administrator shall be entitled to the
Administration Fee payable monthly in arrears on each Quarterly Payment Date
which shall be solely an obligation of the Issuer and payable solely as
provided herein.
19
Section 8. Additional Information to Be Furnished. The Administrator
shall furnish to the Issuer from time to time such additional information
regarding the Collateral as the Issuer shall reasonably request.
Section 9. Independence of the Administrator. For all purposes of
this Agreement, the Administrator shall be an independent contractor and shall
not be subject to the supervision of the Issuer or the Eligible Lender Trustee
with respect to the manner in which it accomplishes the performance of its
obligations hereunder. Unless expressly authorized by the Issuer, the
Administrator shall have no authority to act for or represent the Issuer or
the Eligible Lender Trustee in any way and shall not otherwise be deemed an
agent of the Issuer or the Eligible Lender Trustee.
Section 10. No Joint Venture. Nothing contained in this Agreement
(i) shall constitute the Administrator and either the Issuer or the Eligible
Lender Trustee as members of any partnership, joint venture, association,
syndicate, unincorporated business or other separate entity, (ii) shall be
construed to impose any liability as such on any of them or (iii) shall be
deemed to confer on any of them any express, implied or apparent authority to
incur any obligation or liability on behalf of the others.
Section 11. Other Activities of Administrator. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other Person even though such Person may engage in
business activities similar to those of the Issuer, the Eligible Lender
Trustee or the Indenture Trustee.
Section 12. Administrator Default. If any one of the following
events (an "Administrator Default") shall occur and be continuing:
(a) any failure by the Administrator to direct the Indenture Trustee
to make any required distributions from any of the Trust Accounts, which
failure continues unremedied for three Business Days after written notice
of such failure is received by the Administrator from the Indenture
Trustee or the Eligible Lender Trustee or after discovery of such failure
by a Responsible Officer of the Administrator; or
(b) any failure by the Administrator duly to observe or to perform
in any material respect any other covenants or agreements of the
Administrator set forth in this Agreement or any Basic Documents, which
failure shall (i) materially and adversely affect the rights of
Noteholders and (ii) continues unremedied for a period of 30 days after
the date of discovery of such failure by a Responsible Officer of the
Administrator or on which written notice of such failure, requiring the
same to be remedied, shall have been given (A) to the Administrator by
the Indenture Trustee or the Eligible Lender Trustee or (B) to the
Administrator and to the Indenture Trustee and the Eligible Lender
Trustee by the Noteholders, representing not less than 25% of the
Outstanding Amount of the Notes; or
20
(c) an Insolvency Event occurs with respect to the Administrator; or
(d) any representation or warranty made by the Administrator
hereunder or under any Basic Document, or in any certificate furnished
hereunder or under any Basic Document, shall prove to be untrue or
incomplete in any material respect;
then, and in each and every case, so long as the Administrator Default shall
not have been remedied, either the Indenture Trustee, or the Noteholders
evidencing not less than 75% of the Outstanding Amount of the Notes, by notice
then given in writing to the Administrator (and to the Indenture Trustee and
the Eligible Lender Trustee if given by the Noteholders), may terminate all
the rights and obligations (other than the obligations set forth in Section 24
hereof) of the Administrator under this Agreement. On or after the receipt by
the Administrator of such written notice, all authority and power of the
Administrator under this Agreement, whether with respect to the Notes or the
Financed Student Loans or otherwise, shall, without further action, pass to
and be vested in the Indenture Trustee or such successor Administrator as may
be appointed under Section 13; and, without limitation, the Indenture Trustee
and the Eligible Lender Trustee are hereby authorized and empowered to execute
and deliver, for the benefit of the predecessor Administrator, as
attorney-in-fact or otherwise, any and all documents and other instruments,
and to do or accomplish all other acts or things necessary or appropriate to
effect the purposes of such notice of termination. The predecessor
Administrator shall cooperate with the successor Administrator, the Indenture
Trustee and the Eligible Lender Trustee in effecting the termination of the
responsibilities and rights of the predecessor Administrator under this
Agreement. All reasonable costs and expenses (including attorneys' fees and
expenses) incurred in connection with such transfer of responsibilities and
amending this Agreement to reflect such succession as Administrator pursuant
to this Section shall be paid by the predecessor Administrator upon
presentation of reasonable documentation of such costs and expenses. Upon
receipt of notice of the occurrence of an Administrator Default, the Eligible
Lender Trustee shall give notice thereof to the Rating Agencies.
Section 13. Appointment of Successor.
(a) Upon receipt by the Administrator of notice of termination
pursuant to Section 12, or the resignation by the Administrator in accordance
with the terms of this Agreement, the predecessor Administrator shall continue
to perform its functions as Administrator, in the case of termination, only
until the date specified in such termination notice or, if no such date is
specified in a notice of termination, until a successor Administrator has
accepted and assumed the responsibilities of the Administrator and, in the
case of resignation, until the later of (x) the date 120 days from the
delivery to the Eligible Lender Trustee and the Indenture Trustee of written
notice of such resignation (or written confirmation of such notice) in
accordance with the terms of this Agreement and (y) the date upon which the
predecessor Administrator shall become legally unable to act as Administrator
as specified in the notice of resignation and accompanying Opinion of Counsel.
In the event of termination hereunder of the Administrator, the Issuer shall
appoint a successor Administrator acceptable to the Indenture Trustee and the
successor Administrator shall accept its appointment by a written assumption
in
21
form acceptable to the Indenture Trustee. In the event that a successor
Administrator has not been appointed at the time when the predecessor
Administrator has ceased to act as Administrator in accordance with this
Section, the Indenture Trustee without further action shall automatically be
appointed the successor Administrator and the Indenture Trustee shall be
entitled to the Administration Fee. Notwithstanding the above, the Indenture
Trustee (with prior written notice to the Swap Counterparty) shall, if it
shall be unwilling or legally unable so to act, appoint or petition a court of
competent jurisdiction to appoint, as the successor to the Administrator under
this Agreement and the Administration Agreement, any established institution
the regular business of which shall include the servicing of student loans.
(b) Upon appointment, the successor Administrator (including the
Indenture Trustee acting as successor Administrator) shall be the successor in
all respects to the predecessor Administrator and shall be subject to all the
responsibilities, duties and liabilities placed on the predecessor
Administrator that arise thereafter or are related thereto and shall be
entitled to an amount agreed to by such successor Administrator (which shall
not exceed the Administration Fee unless the Swap Counterparty gives its prior
written consent and such compensation arrangements will not result in a
downgrading of the Class A-1 Notes, the Class A-2 Notes or the Subordinate
Notes by any Rating Agency), and all the rights granted to the predecessor
Administrator by the terms and provisions of this Agreement.
Section 14. Notification to Noteholders. Upon any termination of, or
appointment of a successor to, the Administrator pursuant to Section 12 or 13,
the Indenture Trustee shall give prompt written notice thereof to Noteholders,
the Swap Counterparty and the Rating Agencies (which, in the case of any such
appointment of a successor, shall consist of prior written notice thereof to
the Rating Agencies).
Section 15. Waiver of Past Defaults. The Noteholders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes
may, on behalf of all Noteholders, waive in writing any default by the
Administrator in the performance of its obligations hereunder and any
consequences thereof, except a default in making any required deposits to or
payments from any of the Trust Accounts (or giving instructions regarding the
same) in accordance with this Agreement. Upon any such waiver of a past
default, such default shall cease to exist, and any Administrator Default
arising therefrom shall be deemed to have been remedied for every purpose of
this Agreement to the extent provided in such waiver. No such waiver shall
extend to any subsequent or other default or impair any right consequent
thereto.
Section 16. Notices. Any notice, report or other communication given
hereunder shall be in writing (or in the form of facsimile notice, followed by
written notice) and addressed as follows:
22
(a) if to the Issuer, to
Xxxxx Fargo Student Loan Trust 0000-0
x/x Xxxxx Xxxxx Xxxx Xxxxxxxxx, National Association
Sixth and Xxxxxxxxx Xxxxxx.
Xxxxxxxxxxx, XX 00000
Attention: Asset Backed Administration
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to the Eligible Lender Trustee
at the Corporate Trust Office of the
Eligible Lender Trustee
(b) if to the Eligible Lender Trustee, to
Bank One, National Association
Xxx Xxxx Xxx Xxxxx, Xxxxx XX0-0000
Xxxxxxx, XX 00000-000
Attention: Xxxxxx XxXxxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(c) if to the Administrator, to
Xxxxx Fargo Bank Minnesota, National Association
Sixth and Marquette Avenue
MAC X0000-000
Xxxxxxxxxxx, XX 00000
Attention: Asset Backed Administration
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(d) if to the Indenture Trustee, to
JPMorgan Chase Bank
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Corporate Trust and Agency Group,
Structured Finance Team
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
(e) if to the Swap Counterparty, to the address specified in the
Swap Agreement
23
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed
given if such notice is mailed by certified mail, postage prepaid, or
hand-delivered to the address of such party as provided above.
Section 17. Amendments. This Agreement may be amended from time to
time by a written amendment duly executed and delivered by the Issuer, the
Administrator and the Indenture Trustee, with the prior written consent of the
Eligible Lender Trustee and the Swap Counterparty, but without the consent of
the Noteholders, for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of this Agreement or of
modifying in any manner the rights of the Noteholders; provided, however, that
such amendment will not, in an Opinion of Counsel obtained on behalf of the
Issuer and satisfactory to the Indenture Trustee and the Eligible Lender
Trustee, materially and adversely affect the interest of any Noteholder. This
Agreement may also be amended by the Issuer, the Administrator and the
Indenture Trustee with the prior written consent of the Eligible Lender
Trustee, the Swap Counterparty and the Noteholders of at least a majority in
the Outstanding Amount of the Notes for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Agreement or of modifying in any manner the rights of Noteholders; provided,
however, that no such amendment may (i) increase or reduce in any manner the
amount of, or accelerate or delay the timing of, collections of payments with
respect to the Financed Student Loans or distributions that are required to be
made for the benefit of the Noteholders or (ii) reduce the aforesaid
percentage of the Noteholders which are required to consent to any such
amendment, without the consent of all Outstanding Noteholders. Prior to the
execution of any such amendment, the Administrator shall furnish written
notification of the substance of such amendment to each of the Rating
Agencies.
Section 18. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 13, 25 or 27 of this Agreement
concerning the resignation of the Administrator, this Agreement may not be
assigned by the Administrator.
Section 19. Governing Law. This Agreement 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.
Section 20. Headings. The section headings hereof have been inserted
for convenience of reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.
Section 21. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.
Section 22. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition
24
or unenforceability without invalidating the remaining provisions hereof and
any such prohibition or unenforceability in any jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.
Section 23. Not Applicable to Xxxxx Fargo Bank Minnesota, National
Association in Other Capacities. Nothing in this Agreement shall affect any
obligation Xxxxx Fargo Bank Minnesota, National Association may have in any
other capacity under the Basic Documents.
Section 24. Liability of Administrator. (a) Neither the
Administrator nor any of the directors, officers, employees or agents of the
Administrator in its capacity as Administrator shall be under any liability to
the Issuer, the Indenture Trustee, any other party to any Basic Document or
any other Person for taking any action, or for refraining from the taking of
any action, in good faith in its capacity as Administrator pursuant to this
Agreement or any other Basic Document.
(b) The Administrator undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement, and no implied
covenants or obligations shall be read into this Agreement against the
Administrator.
(c) In the absence of bad faith or negligence on its part, the
Administrator may conclusively rely, as to the truth of the statements and the
correctness of the opinions and calculations expressed therein, upon
certificates or opinions furnished to the Administrator and conforming to the
requirements of this Agreement or any other Basic Document; provided, however,
that the Administrator, upon receipt of any resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Administrator that are specifically required to be furnished
pursuant to any provision of this Agreement or any other Basic Document, shall
examine them to determine whether they substantially conform, without
verification of the accuracy of any computations therein, to the requirements
of this Agreement or any other Basic Document. The Administrator shall give
prompt written notice to the Indenture Trustee of any material lack of
conformity of any such instrument to the applicable requirements of this
Agreement or any other Basic Document discovered by the Administrator that
would entitle the Indenture Trustee to take any action pursuant to this
Agreement or any other Basic Document if such lack of conformity cannot be
cured.
(d) No provision of this Agreement or any other Basic Document shall
be construed to relieve the Administrator from liability for its own
negligence or willful misconduct, except that:
(i) permissive rights of the Administrator shall not be construed as
duties;
(ii) the Administrator shall not be liable for any error of judgment
made in good faith by a Responsible Officer unless it is proved that the
Administrator was negligent in ascertaining the pertinent facts; and
(iii) the Administrator shall not be liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with this Agreement and at the
25
direction of the Indenture Trustee relating to the time, method and place of
conducting any proceeding for any remedy available to the Administrator, or
for exercising any trust or power conferred upon the Administrator under this
Agreement or any other Basic Document.
(e) No provision of this Agreement or any other Basic Document shall
require the Administrator to expend or risk its own funds or otherwise incur
any financial liability in the performance of any of its duties hereunder or
thereunder or in the exercise of any of its rights or powers if it shall have
reasonable grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably assured to it.
(f) For all purposes under this Agreement and any other Basic
Document, the Administrator shall not be deemed to have notice or knowledge of
any default or Event of Default unless a Responsible Officer assigned to and
working in the Corporate Trust Office of the Administrator has actual
knowledge thereof or has received written notice thereof. For purposes of
determining the Administrator's responsibility and liability hereunder or
under any other Basic Document, any reference to default or Event of Default
shall be construed to refer only to such default or Event of Default of which
the Administrator is deemed to have notice as described in this subsection
24(f).
(g) Except as otherwise provided in subsections 24(b) through (f):
(iv) The Administrator may conclusively rely and shall fully be
protected in acting or refraining from acting on any resolution, certificate,
statement, instrument, opinion, report, notice, request, direction, consent,
order, bond, note or other paper or document reasonably believed by it to be
genuine and to have been signed or presented by the proper party or parties.
(v) Whenever, in the administration of this Agreement or any other
Basic Document, the Administrator shall deem it desirable that a matter be
proved or established prior to taking, suffering or omitting any action
hereunder, the Administrator may (unless other evidence be herein specifically
prescribed), in the absence of bad faith on its part, rely on an Officer's
Certificate of the Issuer.
(vi) The Administrator may consult with counsel with respect to any
action to be taken, suffered or omitted by it hereunder and the written advice
of such counsel, obtained in good faith, or any Opinion of Counsel shall be
full and complete authorization and protection in respect of any action taken,
suffered or omitted by it hereunder in good faith reliance thereon.
(vii) The Administrator shall not be under any obligation to appear
in, prosecute or defend any legal action that is not incidental to its duties
as Administrator in accordance with this Agreement or any other Basic Document
and that in its reasonable judgment may involve it in any expense or
liability.
(viii) The Administrator shall not be bound to make any
investigation into the facts or matters stated in any resolution, certificate,
statement, instrument, opinion, report, notice,
26
request, direction, consent, order, bond, note or other paper or document, but
the Administrator, in its discretion, may make such further inquiry or
investigation into such facts or matters as it may see fit and, if the
Administrator shall determine to make such further inquiry or investigation,
it shall be entitled to examine the books, records and premises of the Issuer,
personally or by agent or attorney.
(ix) The Administrator may execute any of the trusts or powers
hereunder or under any other Basic Document or perform any duties hereunder or
thereunder either directly or through agents or attorneys, and the
Administrator shall not be responsible for any misconduct or negligence on the
part of any such agent or attorney appointed by it with due care.
(x) The Administrator shall not be liable for any actions taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights conferred upon the Administrator by this
Agreement or any other Basic Document
For purposes of this Section, in the event of the termination of the
rights and obligations of the Administrator (or any successor thereto pursuant
to Section 25) as Administrator pursuant to Section 12 or a resignation by
such Administrator pursuant to this Agreement, such Administrator shall be
deemed to be the Administrator pending appointment of a successor
Administrator pursuant to Section 13.
Section 25. Merger or Consolidation of, or Assumption of the
Obligations of, Administrator. Any Person (a) into which the Administrator may
be merged or consolidated, (b) which may result from any merger or
consolidation to which the Administrator shall be a party or (c) which may
succeed to the properties and assets of the Administrator substantially as a
whole, shall be the successor to the Administrator without the execution or
filing of any document or any further act by any of the parties to this
Agreement; provided, however, that the Administrator hereby covenants that it
will not consummate any of the foregoing transactions except upon satisfaction
of the following: (i) the surviving Administrator, if other than Xxxxx Fargo
Bank Minnesota, National Association, executes an agreement of assumption to
perform every obligation of the Administrator under this Agreement, (ii)
immediately after giving effect to such transaction, no representation or
warranty made pursuant to Section 1 shall have been breached and no
Administrator Default, and no event that, after notice or lapse of time or
both would become an Administrator Default, shall have occurred and be
continuing and (iii) the Administrator shall have delivered to the Eligible
Lender Trustee, the Indenture Trustee and the Swap Counterparty an Officers'
Certificate or an Opinion of Counsel stating that such consolidation, merger
or succession and such agreement of assumption comply with this Section and
that all conditions precedent, if any, provided for in this Agreement relating
to such transaction have been complied with, and that the Rating Agency
Condition shall have been satisfied with respect to such transaction.
Section 26. Limitation on Liability of Administrator and Others.
Neither the Administrator nor any of its directors, officers, employees or
agents shall be under any liability
27
to the Issuer, the Noteholders, the Indenture Trustee, the Eligible Lender
Trustee or the Swap Counterparty, except as provided under this Agreement, for
any action taken or for refraining from the taking of any action pursuant to
this Agreement or for errors in judgment; provided, however, that this
provision shall not protect the Administrator or any such person against any
liability that would otherwise be imposed by reason of willful misfeasance,
bad faith or negligence in the performance of its duties or by reason of
reckless disregard of obligations and its duties under this Agreement. The
Administrator and any of its directors, officers, employees or agents may rely
in good faith on the advice of counsel or on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder.
Except as provided in this Agreement, the Administrator shall not be
under any obligation to appear in, prosecute or defend any legal action that
shall not be incidental to its duties to administer the Financed Student Loans
and the Trust in accordance with this Agreement, and that in its opinion may
involve it in any expense or liability; provided, however, that the
Administrator may undertake any reasonable action that it may deem necessary
or desirable in respect of this Agreement and the other Basic Documents and
the rights and duties of the parties to this Agreement and the Basic Documents
and the interests of the Noteholders under the Indenture.
Section 27. Xxxxx Fargo Bank Minnesota, National Association Not to
Resign as Administrator. Subject to the provisions of Section 25, Xxxxx Fargo
Bank Minnesota, National Association shall not resign from the obligations and
duties imposed on it as Administrator under this Agreement except upon
determination that the performance of its duties under this Agreement shall no
longer be permissible under applicable law or shall violate any final order of
a court or administrative agency with jurisdiction over Xxxxx Fargo Bank
Minnesota, National Association or its properties. Notice of any such
determination permitting the resignation of Xxxxx Fargo Bank Minnesota,
National Association shall be communicated to the Eligible Lender Trustee and
the Indenture Trustee at the earliest practicable time (and, if such
communication is not in writing, shall be confirmed in writing at the earliest
practicable time) and any such determination shall be evidenced by an Opinion
of Counsel to such effect delivered to the Eligible Lender Trustee and the
Indenture Trustee concurrently with or promptly after such notice. No such
resignation shall become effective until the Indenture Trustee or a successor
Administrator shall have assumed the responsibilities and obligations of Xxxxx
Fargo Bank Minnesota, National Association in accordance with Section 13.
Section 28. Limitation of Liability of Eligible Lender Trustee and
Indenture Trustee. (a) Notwithstanding anything contained herein to the
contrary, except as provided in subsection (c) hereof, this instrument has
been countersigned by Bank One not in its individual capacity but solely in
its capacity as Eligible Lender Trustee of the Issuer and in no event shall
Bank One in its individual capacity or any Owner of the Issuer have any
liability for the representations, warranties, covenants, agreements or other
obligations of the Issuer hereunder, as to all of which recourse shall be had
solely to the assets of the Issuer. For all purposes of this Agreement, in the
performance of any duties or obligations of the Issuer thereunder, the
Eligible
28
Lender Trustee shall be subject to, and entitled to the benefits of, the terms
and provisions of Articles VI, VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the contrary,
except as provided in subsection (c) hereof, this Agreement has been
countersigned by JPMorgan Chase Bank not in its individual capacity but solely
as Indenture Trustee and in no event shall JPMorgan Chase Bank have any
liability for the representations, warranties, covenants, agreements or other
obligations of the Issuer hereunder or in any of the certificates, notices or
agreements delivered pursuant hereto, as to all of which recourse shall be had
solely to the assets of the Issuer.
(c) Notwithstanding any other provision in this Agreement or the
other Basic Documents, nothing in this Agreement or the other Basic Documents
shall be construed to limit the legal responsibility of the Eligible Lender
Trustee or the Indenture Trustee, to the U.S. Secretary of Education or a
Guarantor for any violations of statutory or regulatory requirements that may
occur with respect to loans held by the Eligible Lender Trustee or the
Indenture Trustee pursuant to, or to otherwise comply with their obligations
under, the Higher Education Act or implementing regulations.
Section 29. Notice of Termination of Trust. As described in Article
IX of the Trust Agreement, notice of any termination of the Trust shall be
given by the Administrator to the Eligible Lender Trustee and the Indenture
Trustee as soon as practicable after the Administrator has received notice
thereof.
Section 30. Third-Party Beneficiaries. The Eligible Lender Trustee
and the Swap Counterparty are third-party beneficiaries to this Agreement and
are entitled to the rights and benefits hereunder and may enforce the
provisions hereof as if they were parties hereto; provided, however, that in
the case of the Swap Counterparty, such right to enforcement and the right to
provide consents or waivers pursuant to the provisions hereof or to take other
actions as provided herein are conditioned upon its not being in default under
the Swap Agreement.
Section 31. Consents. With respect to any action to be taken
hereunder that requires the consent of a party hereto or of the Eligible
Lender Trustee or the Swap Counterparty, such consent shall not be
unreasonably withheld, delayed or conditioned.
[Signatures Follow on Next Page]
29
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the day and year first above written.
XXXXX FARGO STUDENT LOAN TRUST 2001-1
By: BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but solely as
Eligible Lender Trustee on behalf of the
Trust
By: /s/ Xxxxxx XxXxxxx
-----------------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Vice President
JPMORGAN CHASE BANK, not in its individual
capacity but solely as Indenture Trustee
By: /s/ Xxxxxxxx X. Xxxxx
--------------------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Assistant Vice President
XXXXX FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, not in its
individual capacity but solely as Administrator
By: /s/ Xxxxxxxx Xxxxxxxx
--------------------------------------------
Name:
Title:
Acknowledged and accepted as of the day
and year first above written:
XXXXX FARGO BANK SOUTH DAKOTA,
NATIONAL ASSOCIATION, not in its
individual capacity but solely as Servicer
By: /s/ Xxxx X. Xxxxxxx
--------------------------------
Name: Gllen X. Xxxxxxx
Title: Senior Vice President
30
EXHIBIT A TO THE
ADMINISTRATION AGREEMENT
POWER OF ATTORNEY
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
KNOW ALL MEN BY THESE PRESENTS, BANK ONE, NATIONAL ASSOCIATION, a
national bank, not in its individual capacity but solely as eligible lender
trustee ("Eligible Lender Trustee") for the Xxxxx Fargo Student Loan Trust
2001-1 (the "Trust"), does hereby make, constitute and appoint Xxxxx Fargo
Bank Minnesota, National Association, as Administrator under the
Administration Agreement (as defined below), and its agents and attorneys, as
Agents and Attorneys-in-Fact to execute on behalf of Eligible Lender Trustee
or the Trust all such documents, reports, filings, instruments, certificates
and opinions as it should be the duty of Eligible Lender Trustee or the Trust
to prepare, file or deliver pursuant to the Related Documents (as defined in
the Administration Agreement) or pursuant to Section 5.02 of the Trust
Agreement (as defined in the Administration Agreement), including without
limitation, to appear for and represent Eligible Lender Trustee and the Trust
in connection with the preparation, filing and audit of any federal, state and
local tax returns pertaining to the Trust, and with full power to perform any
and all acts associated with such returns and audits that the Eligible Lender
Trustee could perform, including without limitation, the right to distribute
and receive confidential information, defend and assert positions in response
to audits, initiate and defend litigation, and to execute waivers of
restriction on assessments of deficiencies, consents to the extension of any
statutory or regulatory time limit, and settlements. For the purpose of this
Power of Attorney, the term "Administration Agreement" means the
Administration Agreement dated as of November 1, 2001, among the Trust, Xxxxx
Fargo Bank Minnesota, National Association, as Administrator, and JPMorgan
Chase Bank, as Indenture Trustee, as such may be amended from time to time.
All powers of attorney for this purpose heretofore filed or executed by
Eligible Lender Trustee are hereby revoked.
EXECUTED as of the 27th day of November, 2001.
BANK ONE, NATIONAL ASSOCIATION, not in
its individual capacity but solely as
Eligible Lender Trustee
By:
------------------------------------
Name:
Title:
X-0
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
Before me, the undersigned authority, on this day personally appeared [ ]
known to me to be the person whose name is subscribed to the foregoing
instrument, and acknowledged to me that such person signed the same for the
purposes and considerations therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this [o] day of [o].
------------------------------------------------
Notary Public in and for the State of New York
------------------------------------------------
Printed Name of Notary Public
Commission Expires____________
A-2
EXHIBIT B
TO THE
ADMINISTRATION AGREEMENT
Form of Noteholders' Statement pursuant to Section 2(g) of Administration
Agreement. Capitalized terms used herein are defined in Appendix A thereto. It
should be noted, however, that while all the information listed below shall be
included in each Noteholders' Statement, the presentation thereof may vary
from that given below.
Quarterly Payment Date:
(i) Amount of principal being paid or distributed:
Class A-1 __________* ($_______ *
per $1,000 original
principal amount of
Notes)
Class A-2 __________* ($_______ *
per $1,000 original
principal amount of
Notes)
Subordinate __________* ($_______ *
per $1,000 original
principal amount of
Notes)
----------
* Portion of each such amount attributable to Reserve Account
Excess:___________________
(ii) Amount of interest being paid or distributed:
Class A-1 __________ ($_______
per $1,000 original
principal amount of
Notes)
Class A-2 __________ ($_______
per $1,000 original
principal amount of
Notes)
Subordinate __________ ($_______
per $1,000 original
principal amount of
Notes)
(iii) Reserved
(iv) Reserved
(v) Pool Balance at end of related Collection Period:
---------------
(vi) After giving effect to distributions on this Quarterly Payment Date:
(a) (1) outstanding principal amount of Class A-1 Notes:_______
(2) Class A-1 Note Pool Factor:__________
(b) (1) outstanding principal amount of Class A-2 Notes:_______
(2) Class A-2 Note Pool Factor:__________
(c) (1) outstanding principal amount of Subordinate Notes:__________
(2) Subordinate Note Pool Factor:__________
(vii) Applicable Interest Rate:
In general:
(1) Three-Month LIBOR for the LIBOR Reset Period since the previous
Quarterly Payment Date was _____%;
Class A-1 Note Rate: _____%
Class A-2 Note Rate: _____%
Subordinate Note Rate: _____%
(viii) Amount of Servicing Fee for related Collection Period including a
breakdown of the components of the Servicing Fee attributable to
each of the items specified in Section 3.06 of the Servicing
Agreement:
(ix) Amount of Administration Fee for related Collection
Period:__________
(x) the Swap Fee for such Quarterly Payment Date and the amount of
each other payment made to the Swap Counterparty on such Quarterly
Payment Date
C-2
(xi) Reserved
(xii) Aggregate amount of Realized Losses (if any) for the related
Collection Period:__________
(xiii) Financed Student Loans delinquent at end of related Collection
Period: __________; number of delinquent loans: ________;
aggregate unpaid principal balance of delinquent loans:
___________________
(xiv) Withdrawal from Reserve Account on related Quarterly Payment Date
(other than Reserve Account Excess) and on any Monthly Payment
Date since the preceding Quarterly Payment Date (list each
withdrawal separately): _______________ (purpose of each
withdrawal).
Reserve Account Excess on related Quarterly Payment Date ________
Principal balance of Notes to be paid to reach Parity
Date:_________
Principal balance of Notes to be paid to reach 100.5% support
level:_________
(xv) Draw on Demand Note [withdrawal from Demand Note Account] on
related Quarterly Payment Date and on any Monthly Payment Date
since the preceding Quarterly Payment Date (list each draw
[withdrawal] separately):___________ (purpose of each withdrawal)
(xvi) Withdrawals from Prefunding Account during related Collection
Period: __________
(xvii) Amount in the Reserve Account (after giving effect to
(xiv)):__________
(xviii) Amount of Demand Note [amount in Demand Note Account] (after
giving effect to (xv))
(xix) Amount in the Prefunding Account (after giving effect to
(xvi)):__________
(xx) Consolidation Loans: ___________ loans with aggregate principal
balances of ________ were originated during related Collection
Period; withdrawal from Prefunding Account to fund origination of
Consolidation Loans during related Collection Period: _______
(xxi) Add-on Consolidation Loans: ______ loans with aggregate principal
balances of ________ were added to the principal balance of a
Consolidation Loan; withdrawal from Prefunding Account to fund the
addition of the principal balances of Add-on Consolidation Loans
during the related Collection Period: _____
C-3
(xxii) Serial Loans: _______ loans with aggregate principal balances of
_______ were purchased ------- during the related Collection
Period; withdrawal from Prefunding Account to fund the acquisition
of Serial Loans during the related Collection Period: _____
(xxiii) Withdrawal from the Prefunding Account during the related
Collection Period (list each withdrawal pursuant to Section
2(f)(i) separately): ____________. (purpose of each withdrawal)
(xxiv) Financed Student Loans in the following categories as of the end
of the related Collection Period:
Weighted Average Number
Interest Rate of Loans Principal Balance
Status Type:
-----------
In-School
Grace
Repayment
Forbearance
Deferment
Delinquencies
Claims Filed Awaiting Payment
Delinquencies:
-------------
30-60 Days
61-90 Days
91-120 Days
More than 120 Days Delinquent
Claims Filed Awaiting Payment
Loan Type:
---------
Xxxxxxxx Loans
C-4
SLS Loans
PLUS Loans
Consolidation Loans
School Type:
-----------
Traditional
Vocational/Proprietary
C-5
EXECUTION COPY
APPENDIX A TO THE
ADMINISTRATION AGREEMENT
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.
Definitions
"Act" has the meaning specified in Section 11.03(a) of the
Indenture.
"Additional Fundings" means any withdrawals from the Prefunding
Account for any of the purposes set forth in Section 2(f) of the
Administration Agreement.
"Add-on Consolidation Loan" means a Student Loan, the principal
balance of which is added to an existing Consolidation Loan within 210 days
from the date that the existing Consolidation Loan was made, as required by
the Higher Education Act.
"Add-on Consolidation Loan Funding Date" means each day, prior to
the end of the Add-on Period, on which the principal balance of an Add-on
Consolidation Loan is added to the principal balance of a Consolidation Loan
in the Trust pursuant to Section 6.07 of the Trust Agreement.
"Add-on Period" means the period starting on the Closing Date and
ending on the date that is 210 days from the date that the last Consolidation
Loan was originated by the Trust during the Funding Period.
"Administration Agreement" means the Administration Agreement dated
as of November 1, 2001, among the Issuer, the Administrator and the Indenture
Trustee.
"Administration Fee" means, with respect to each Quarterly Payment
Date, an amount equal to $750.00.
"Administrator" means Xxxxx Fargo Bank Minnesota, National
Association, a national banking association, in its capacity as administrator
of the Issuer.
"Administrator Default" shall have the meaning set forth in Section
12 of the Administration Agreement.
"Administrator's Certificate" means an Officers' Certificate of the
Administrator delivered pursuant to Section 2(b)(ii) of the Administration
Agreement.
"Affiliate" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used
with respect to any specified Person means the power to direct the management
and policies of such Person, directly or indirectly, whether through the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Assignment" means a duly executed assignment delivered pursuant to
Section 3.02 of the Loan Sale Agreement in the form set forth in Exhibit F to
such Agreement.
"Authorized Officer" means (i) with respect to the Issuer, any
officer of the Eligible Lender Trustee who is authorized to act for the
Eligible Lender Trustee in matters
2
relating to the Issuer pursuant to the Basic Documents and who is identified
on the list of Authorized Officers delivered by the Eligible Lender Trustee to
the Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter) and (ii) with respect to the
Depositor, the Seller, the Servicer and the Administrator, any officer or
other authorized representative of the Depositor, the Seller, the Servicer or
the Administrator, respectively, who is authorized to act for the Depositor,
the Seller, the Servicer or the Administrator, respectively, in matters
relating to itself or to the Issuer and to be acted upon by the Depositor, the
Seller, the Servicer or the Administrator, respectively, pursuant to the Basic
Documents and who is identified on the list of Authorized Officers delivered
by the Depositor, the Seller, the Servicer and the Administrator,
respectively, to the Indenture Trustee on the Closing Date (as such list may
be modified or supplemented from time to time thereafter).
"Available Funds" means, with respect to a Quarterly Payment Date
and the related Collection Period, the sum of (1) the amounts specified in
clauses (i) through (vi) of the definition of Monthly Available Funds for each
of the three Monthly Collection Periods included in such Collection Period,
(2) all payments made by the Swap Counterparty under the Swap Agreement and
received by the Issuer with respect to such Quarterly Payment Date including
any Termination Payment received by the Trust with respect to such Quarterly
Payment Date and (3) at the end of the Funding Period the amount deposited
from the Prefunding Account to the Collection Account pursuant to Section
2(f)(iii) of the Administration Agreement; provided, however, that if with
respect to any Quarterly Payment Date there would not be sufficient funds,
after application of the Available Funds (as defined above) and amounts
available first from the Reserve Account and second from draws on the Demand
Note (or, if applicable, withdrawals from the Demand Note Account), to pay any
of the items specified in clauses (v)(A) through (v)(D) of Section 2(d) of the
Administration Agreement, then the Available Funds for such Quarterly Payment
Date will include, in addition to the Available Funds (as defined above),
amounts on deposit in the Collection Account on the Determination Date
relating to such Quarterly Payment Date which would have constituted the
Available Funds for the Quarterly Payment Date succeeding such Quarterly
Payment Date up to the amount necessary to pay such items, and the Available
Funds for such succeeding Quarterly Payment Date will be adjusted accordingly;
and provided, further, that the Available Funds will exclude (A) all payments
and proceeds (including Liquidation Proceeds) of any Financed Student Loans
the Purchase Amounts of which were included in the Available Funds for a prior
Collection Period; (B) amounts released from the Prefunding Account; (C) any
Monthly Rebate Fees paid during the related Collection Period by or on behalf
of the Trust; (D) any collections in respect of any principal on the Financed
Student Loans applied by the Eligible Lender Trustee on behalf of the Trust,
after the end of the Funding Period, to fund the addition of any Add-on
Consolidation Loans or to purchase Serial Loans during the related Collection
Period; and (E) the Servicing Fee and all overdue Servicing Fees paid on each
Monthly Payment Date that is not a Quarterly Payment Date during the related
Collection Period.
"Basic Documents" means the Trust Agreement, the Indenture, the Loan
Sale Agreement, the Servicing Agreement, the Administration Agreement, the
Depository Agreement, the Guarantee Agreements, any Swap Agreement and other
documents and certificates delivered in connection with any thereof.
3
"Billing Account" means those combined loans of a Borrower with the
same lender and branch, which loans are in the same status, and are the same
loan type, and are guaranteed by the same Guarantor and which require the same
processing and billing requirements. Xxxxxxxx Loans which are already in
repayment and being serviced by the Servicer will not be merged with new
Xxxxxxxx Loans for the same Borrower, and each such Xxxxxxxx Loan will be
treated as a separate Billing Account.
"Book-Entry Note" means a beneficial interest in the Senior Notes
and the Subordinate 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.
"Borrower" means an individual who is the maker of a Borrower Note
and who obtains a Student Loan from an "eligible lender" in accordance with
the Higher Education Act and the policies and procedures of a Guarantor.
"Borrower Note" means a promissory note of a Borrower for a Student
Loan set forth on the appropriate form furnished by the Guarantor which
Borrower Note meets the criteria set forth by the Higher Education Act and the
policies and procedures of the Guarantor.
"Business Day" means any day other than (i) a Saturday or a Sunday,
or (ii) a day on which banking institutions or trust companies in the States
of New York, Minnesota or in the city in which the Corporate Trust Office of
the Indenture Trustee is located are authorized or obligated by law,
regulation or executive order to remain closed.
"Business Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as the same may be amended from
time to time.
"Capitalized Interest Amount" means for any Monthly Collection
Period or other period of determination, the amount of interest that accrued
on the Financed Student Loans during such period but was not then payable and
that has been or will, pursuant to the terms of such Financed Student Loans,
be capitalized and added to the principal balances of such loans.
"Certificate of Trust" means the Certificate of Trust in the form of
Exhibit A to the Trust Agreement to be filed for the Trust pursuant to Section
3810(a) of the Business Trust Statute.
"Class A-1 Note" means a Class A-1 Floating Rate Asset- Backed
Senior Note issued pursuant to the Indenture, substantially in the form of
Exhibit A-1 thereto.
"Class A-1 Note Final Maturity Date" means the August 2008 Quarterly
Payment Date.
"Class A-1 Note Pool Factor" as of the close of business on a
Quarterly Payment Date means a seven-digit decimal figure equal to the
outstanding principal amount of the Class A-1 Notes divided by the original
outstanding principal amount of the Class A-1 Notes. The Class A-1 Note Pool
Factor will be 1.0000000 as of the Closing Date; thereafter, the Class A-1
4
Note Pool Factor will decline to reflect reductions in the outstanding
principal amount of the Class A-1 Notes.
"Class A-1 Note Rate" means, with respect to any Quarterly Interest
Period, the interest rate per annum (computed on the basis of the actual
number of days in such Quarterly Interest Period over a year of 360 days)
equal to Three-Month LIBOR for the related LIBOR Reset Period plus (i) 0.08%
and (ii) plus an additional 0.50% with respect to each succeeding Quarterly
Interest Period commencing on the first Quarterly Payment Date as of which the
Servicer has the right to purchase the Financed Student Loans pursuant to
Section 7.01 of the Servicing Agreement, if the Servicer has not exercised
such right on such Quarterly Payment Date.
"Class A-1 Noteholder" means the Noteholder of a Class A-1 Note.
"Class A-1 Noteholders' Interest Carryover Shortfall" means, with
respect to any Quarterly Payment Date, the excess of (i) the Class A-1
Noteholders' Interest Distribution Amount on the preceding Quarterly Payment
Date over (ii) the amount of interest actually distributed to the Class A-1
Noteholders on such preceding Quarterly Payment Date, plus interest on the
amount of such excess, to the extent permitted by law, at the then current
Class A-1 Note Rate from such preceding Quarterly Payment Date to the current
Quarterly Payment Date.
"Class A-1 Noteholders' Interest Distribution Amount" means, with
respect to any Quarterly Payment Date, the sum of (i) the amount of interest
accrued at the Class A-1 Note Rate for the related Quarterly Interest Period
on the outstanding principal balance of the Class A-1 Notes on the immediately
preceding Quarterly Payment Date (after giving effect to all principal
distributions to holders of Class A-1 Notes on such date) or, in the case of
first Quarterly Payment Date, on the Closing Date and (ii) the Class A-1
Noteholders' Interest Carryover Shortfall for such Quarterly Payment Date.
"Class A-2 Note" means a Class A-2 Floating Rate Asset- Backed
Senior Note issued pursuant to the Indenture, substantially in the form of
Exhibit A-2 thereto.
"Class A-2 Note Final Maturity Date" means the May 2030 Quarterly
Payment Date.
"Class A-2 Note Pool Factor" as of the close of business on a
Quarterly Payment Date means a seven-digit decimal figure equal to the
outstanding principal amount of the Class A-2 Notes divided by the original
outstanding principal amount of the Class A-2 Notes. The Class A-2 Note Pool
Factor will be 1.0000000 as of the Closing Date; thereafter, the Class A-2
Note Pool Factor will decline to reflect reductions in the outstanding
principal balance of the Class A-2 Notes.
"Class A-2 Note Rate" means, with respect to any Quarterly Payment
Date and the related Quarterly Interest Period, the interest rate per annum
(computed on the basis of the actual number of days in such Quarterly Interest
Period over a year of 360 days) equal to Three-Month LIBOR for the related
LIBOR Reset Period plus 0.18% and (ii) plus an additional 0.50%
5
with respect to each succeeding Quarterly Interest Period commencing on the
first Quarterly Payment Date as of which the Servicer has the right to
purchase the Financed Student Loans pursuant to Section 7.01 of the Servicing
Agreement, if the Servicer has not exercised such right on such Quarterly
Payment Date.
"Class A-2 Noteholder" means the Noteholder of a Class A-2 Note.
"Class A-2 Noteholders' Interest Carryover Shortfall" means, with
respect to any Quarterly Payment Date, the excess of (i) the Class A-2
Noteholders' Interest Distribution Amount on the preceding Quarterly Payment
Date over (ii) the amount of interest actually distributed to the Class A-2
Noteholders on such preceding Quarterly Payment Date, plus interest on the
amount of such excess, to the extent permitted by law at the then current
Class A-2 Note Rate from such preceding Quarterly Payment Date to the current
Quarterly Payment Date.
"Class A-2 Noteholders' Interest Distribution Amount" means, with
respect to any Quarterly Payment Date, the sum of (i) the amount of interest
accrued at the Class A-2 Note Rate for the related Quarterly Interest Period
on the aggregate principal amount of the Class A-2 Notes outstanding on the
immediately preceding Quarterly Payment Date (after giving effect to all
principal distributions to holders of Class A-2 Notes on such date) or, in the
case of the first Quarterly Payment Date, on the Closing Date and (ii) the
Class A-2 Noteholders' Interest Carryover Shortfall for such Quarterly Payment
Date;
"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.
"Closing Date" means November 27, 2001.
"Code" means the Internal Revenue Code of 1986, as amended from time
to time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of the
Indenture.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 2(c) of the Administration
Agreement, which shall be an Eligible Deposit Account.
"Collection Period" means, with respect to the first Quarterly
Payment Date, the period beginning on the Cutoff Date and ending on January
31, 2002, and with respect to each subsequent Quarterly Payment Date, the
Collection Period means the three calendar months immediately following the
end of the previous Collection Period.
"Commission" means the Securities and Exchange Commission.
6
"Consolidation Fee" means any Federal Origination Fee, Monthly
Rebate Fee or similar fee payable to the Department relating to the
origination or ownership of Consolidation Loans.
"Consolidation Loan" means a Student Loan made pursuant to the
Higher Education Act to consolidate the Borrower's obligations under various
federally authorized student loan programs into a single loan, as supplemented
by the addition of any related Add-on Consolidation Loans.
"Corporate Trust Office" means (i) with respect to the Indenture
Trustee, the principal office of the Indenture Trustee at which at any
particular time its corporate trust business shall be administered, which
office at the Closing Date is located at 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxxxx Xxxxx (telephone: (000) 000-0000; facsimile:
(000) 000-0000) or at such other address as the Indenture Trustee may
designate from time to time by notice to the Noteholders and the Depositor, or
the principal corporate trust office of any successor Indenture Trustee (the
address of which the successor Indenture Trustee will notify the Noteholders
and the Depositor) and (ii) with respect to the Eligible Lender Trustee, the
principal corporate trust office of the Eligible Lender Trustee located at 0
Xxxx Xxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000 Attention: Corporate Trust
Services (telephone: (000) 000-0000; facsimile: (000) 000-0000) or at such
other address as the Eligible Lender Trustee may designate by notice to the
Depositor or the principal corporate trust office of any successor Eligible
Lender Trustee (the address of which the successor Eligible Lender Trustee
will notify the Depositor.
"Custodian" means Xxxxx Fargo Bank South Dakota, National
Association in its capacity as custodian of the Borrower Notes or any
permitted successor Custodian.
"Cutoff Date" means November 1, 2001.
"Default" means any occurrence that is, or with notice or the lapse
of time or both would become, an Event of Default.
"Deferral" means the period defined by the Higher Education Act and
the policies of the related Guarantor during which a Borrower (in Repayment)
is entitled to postpone making payments upon the submission of appropriate
documentation.
"Deferral Loan" means a Student Loan during a period of Deferral.
"Definitive Notes" has the meaning specified in Section 2.10 of the
Indenture.
"Delaware Trust" has the meaning specified in Section 10.01 of the
Trust Agreement.
"Delaware Trustee" has the meaning set forth in Section 10.01 of the
Trust Agreement.
7
"Deleted Student Loan" has the meaning specified in Section 3.02 of
the Loan Sale Agreement.
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial paper, negotiable
certificates of deposit and other obligations that constitute instruments and
are susceptible of physical delivery ("Physical Property"):
(i) transfer of possession thereof to the Indenture Trustee,
endorsed to, or registered in the name of, the Indenture Trustee or its
nominee or endorsed in blank;
(b) 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
(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;
(e) with respect to a security entitlement:
(i) the Indenture Trustee becomes the entitlement holder; or
8
(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 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"
9
(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.
"Demand Note" means a demand note, issued by the Demand Note
Provider to the Depositor, in the amount of $10,525,000.
"Demand Note Account" means the account designated as such, to the
extent required to be established and maintained pursuant to Section 2(c) of
the Administration Agreement, which shall be an Eligible Deposit Account.
"Demand Note Expiration Date" means the Quarterly Payment Date in
November 2003.
"Demand Note Provider" means Xxxxx Fargo Bank South Dakota, National
Association, and its successors and assignors.
"Department" means the United States Department of Education, an
agency of the Federal government.
"Depositor" means Xxxxx Fargo Student Loans Receivables I, LLC.
"Depository Agreement" means, the agreement with respect to the
Notes attached to the Indenture as Exhibit B.
"Determination Date" means, with respect to any Monthly Payment
Date, the third Business Day preceding such Monthly Payment Date.
"Educational Institution" means any institution of higher education
that participates in the guaranteed loan programs authorized by Title IV of
the Higher Education Act and which is deemed eligible by a Guarantor to
participate in such Guarantor's program.
"Eligible Deposit Account" means either (a) a segregated account
with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the
laws of the United States of America or any one of the States (or 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 each Rating Agency in one of
its generic rating categories which signifies investment grade.
"Eligible Institution" means a depository institution organized
under the laws of the United States of America or any one of the States (or
any domestic branch of a foreign bank), which (i) has (A) either a long-term
senior unsecured debt rating of "AAA" by S&P and if rated by Fitch, "AAA" by
Fitch or a short-term senior unsecured debt or certificate of deposit rating
of "A-1+" by S&P and if rated by Fitch, "F-1+" by Fitch and (B)(1) a long-term
senior unsecured
10
debt rating of "A1" or better and (2) a short-term senior unsecured debt
rating of "P-1" by Moody's, or any other long-term, short-term or certificate
of deposit rating acceptable to the Rating Agencies and (ii) whose deposits
are insured by the FDIC. If so qualified, the Eligible Lender Trustee or the
Indenture Trustee may be considered an Eligible Institution.
"Eligible Investments" means book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to timely
payment by, the United States of America;
(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 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 Quarterly Payment Date), the commercial paper or other
short-term senior unsecured debt obligations (other than such obligations the
rating of which is based on the credit of a Person other than such depository
institution or trust company) thereof shall have a credit rating from each of
the Rating Agencies in the highest investment category granted thereby;
(c) commercial paper having, at the time of the investment or contractual
commitment to invest therein, a rating from each of the Rating Agencies in the
highest investment category granted thereby;
(d) investments in money market funds having a rating from each of the
Rating Agencies in the highest investment category granted thereby (including
funds for which the Indenture Trustee, the Servicer or the Eligible Lender
Trustee or any of their respective Affiliates is investment manager or
advisor);
(e) bankers' acceptances issued by any depository institution or trust
company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a direct
obligation of, or fully guaranteed by, the United States of America or any
agency or instrumentality thereof the obligations of which are backed by the
full faith and credit of the United States of America, in either case entered
into with a depository institution or trust company (acting as principal)
described in clause (b) above;
(g) any other investment permitted by each of the Rating Agencies as set
forth in a writing delivered to the Indenture Trustee.
11
No obligation will be considered to be rated in the highest
investment category if it has an "r" highlighter affixed to its rating.
"Eligible Lender Trustee" means Bank One, National Association, a
national banking association, not in its individual capacity but solely as
Eligible Lender Trustee under the Trust Agreement.
"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 or the Treasurer of such corporation; and with
respect to any partnership, any general partner thereof.
"Expected Interest Collections" means, with respect to any Quarterly
Interest Period, the sum of (i) the amount of interest accrued, net of accrued
Monthly Rebate Fees and other amounts required by the Higher Education Act to
be paid to the Department, with respect to the Financed Student Loans for the
related Student Loan Rate Accrual Period (whether or not such interest is
actually paid), (ii) all Interest Subsidy Payments and Special Allowance
Payments estimated to have accrued for such Student Loan Rate Accrual Period
whether or not actually received (taking into account any expected deduction
therefrom of Federal Origination Fees) and (iii) Investment Earnings for such
Student Loan Rate Accrual Period.
"Expenses" means any and all liabilities, obligations, losses,
damages, taxes, claims, actions and suits, and any and all reasonable costs,
expenses and disbursements (including reasonable legal fees and expenses) of
any kind and nature whatsoever which may at any time be imposed on, incurred
by, or asserted against the Eligible Lender Trustee or any of its officers,
directors or agents in any way relating to or arising out of the Trust
Agreement, the other Basic Documents, the Trust Estate, the administration of
the Trust Estate or the action or inaction of the Eligible Lender Trustee
under the Trust Agreement or the other Basic Documents.
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Guarantor" means a state or private non-profit guarantor
that guarantees the payment of principal of and interest on any of the
Financed Student Loans, which agency is reinsured by the Department under the
Higher Education Act for between (x) 80% and 100% of the amount of default
claims paid by such Federal Guarantor for a given federal fiscal year for
loans disbursed prior to October 1, 1993, for 78% to 98% of default claims
paid for loans disbursed on or after October 1, 1993 but prior to October 1,
1998 any (y) 75% to 95% of the amount of default claims paid to by such
Federal Guarantor for a given federal fiscal year for loans disbursed on or
after October 1, 1998 and for 100% of death, disability, bankruptcy, closed
school and false certification claims paid.
12
"Federal Origination Fee" means, with respect to each Consolidation
Loan that is originated by the Eligible Lender Trustee on behalf of the Issuer
and each Add-on Consolidation Loan that is added to the principal balance of a
Consolidation Loan, the origination fee payable to the Department equal to
0.5% of the initial principal balance of such Consolidation Loan or Add-on
Consolidation Loan.
"Final Maturity Date" means collectively, the Class A-1 Note Final
Maturity Date, the Class A-2 Final Maturity Date and the Subordinate Note
Final Maturity Date.
"Financed Student Loans" means those Student Loans that, as of any
date of determination, have been conveyed to the Issuer, consisting of the
Initial Financed Student Loans as of the Closing Date and, thereafter, any
Prefunded Loans or Serial Loans conveyed to the Issuer from the Depositor, any
Consolidation Loans originated by the Trust as provided in Section 6.07 of the
Trust Agreement, any Consolidation Loans the principal balance of which is
increased by the principal balance of any related Add-on Consolidation Loan as
provided in Section 6.07 of the Trust Agreement and any Qualified Substitute
Student Loans conveyed to the Issuer as provided in Section 3.02 of the Loan
Sale Agreement.
"Fitch" means Fitch, Inc. or any successor thereto.
"Forbearance Loan" means a Student Loan during a period of
forbearance of loan collections pursuant to the Higher Education Act.
"Funding Period" means the period from the Closing Date until the
first to occur of (a) the Quarterly Payment Date on which the amount on
deposit in the Prefunding Account is less than $100,000, (b) an Event of
Default occurring under the Indenture, a Servicer Default occurring under the
Servicing Agreement or an Administrator Default occurring under the
Administration Agreement, (c) an Insolvency Event occurring with respect to
the Depositor or the Seller, or (d) the last day of the Collection Period
preceding the November, 2003 Quarterly Payment Date.
"Grace" means the initial period following reduction by the student
Borrower to less than the minimum course load required by the Higher Education
Act, during which the student Borrower is not required to make payments on the
principal amount of the Borrower Note(s).
"Grace Loan" means a Student Loan during a period of Grace.
"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
13
Proceedings in the name of the Granting party or otherwise and generally to do
and receive anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Guarantee Agreement" means each agreement to guarantee Student
Loans entered into by the Eligible Lender Trustee on behalf of the Trust with
a Guarantor.
"Guarantee Payment" means any payment made by a Guarantor pursuant
to a Guarantee Agreement in respect of a Financed Student Loan.
"Guarantor" means the Colorado Department of Higher Education,
d/b/a/ the Colorado Student Loan Program, the Illinois Student Assistance
Commission and the National Student Loan Program, and their respective
successors.
"Higher Education Act" means the Higher Education Act of 1965, as
amended, together with any rules, regulations and interpretations thereunder.
"Indenture" means the Indenture dated as of November 1, 2001,
between the Issuer and the Indenture Trustee.
"Indenture Trust Estate" means all money, instruments, rights and
other property that are subject or intended to be subject to the lien and
security interest of the Indenture for the benefit of the Noteholders
(including all property and interests Granted to the Indenture Trustee),
including all proceeds thereof.
"Indenture Trustee" means JPMorgan Chase Bank, a New York banking
corporation, not in its individual capacity but solely as Indenture Trustee
under the Indenture.
"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 Seller 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 Seller or any
Affiliate of any of the foregoing Persons and (c) is not connected with the
Issuer, any such other obligor, the Seller or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter, underwriter, trustee,
partner, director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.01 of the
Indenture, made by an Independent appraiser or other expert appointed by an
Issuer Order and approved by the Indenture Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that the signer
has read the definition of "Independent" in the Indenture and that the signer
is Independent within the meaning thereof.
"Initial Financed Student Loans" means those Financed Student Loans
conveyed to the Issuer on the Closing Date and listed on the Schedule of
Student Loans on such date.
14
"Initial Pool Balance" means $499,890,592.
"In-School Loan" means a Student Loan during the period, excluding
periods of in-school Deferral, during which a student Borrower is enrolled at
an Educational Institution for at least the minimum course load required to
maintain such student Borrower's eligibility to borrow under the education
loan programs administered by the Guarantor.
"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 sixty
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 Subsidy Payments" means payments, designated as such,
consisting of interest subsidies by the Department in respect of the Financed
Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Investment Earnings" means, with respect to any Monthly Payment
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 Monthly Payment Date or Quarterly Payment Date, as
applicable, pursuant to Section 2(c)(iv) of the Administration Agreement.
"Issuer" means Xxxxx Fargo Student Loan Trust 2001-1, until a
successor replaces it and, thereafter, means the successor and, for purposes
of any provision contained in the Indenture and required by the TIA, each
other obligor on the Notes.
"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 Determination Date" means, with respect to any Quarterly
Interest Period, other than the initial Quarterly Interest Period, the day
that is the second business day prior to the commencement of the LIBOR Reset
Period within such Quarterly Interest Period (or, in the case of the initial
LIBOR Reset Period, on the second business day prior to the Closing
15
Date). For purposes of this definition, a business day is any day in which
banks in the City of London and The City of New York are open for the
transaction of international business.
"LIBOR Reset Period" means the three-month period commencing on the
twenty-fifth day (or, if any such day is not a Business Day, on the next
succeeding Business Day) of each February, May, August and November and ending
on the day immediately preceding the following LIBOR Reset Period; provided,
however, that the initial LIBOR Reset Period will commence on the Closing
Date.
"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 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 Servicer or which the Servicer has, after using all
reasonable efforts to realize upon the such 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, net of the sum of any reasonable out-of-pocket expenses incurred
by the Servicer in connection with such liquidation and any amounts required
by law to be remitted to the Borrower on such Liquidated Student Loan.
"Loan Purchase Amount" means with respect to a Prefunded Loan or a
Serial Loan to be purchased from the Depositor by the Issuer, an amount equal
as of the related Subsequent Cut-off Date, to the principal balance of such
loan plus accrued borrower interest thereon.
"Loan Sale Agreement" means the Loan Sale Agreement dated as of
November 1, 2001 among the Issuer, the Depositor, the Seller and the Eligible
Lender Trustee.
"Minimum Purchase Price" means, as to any Quarterly Payment Date, an
amount equal to the amount that, when added to the Available Funds for such
Quarterly Payment Date and all amounts on deposit in the Reserve Account,
would be sufficient to (A) reduce the outstanding principal amount of the
Notes then outstanding on such Quarterly Payment Date to zero, (B) pay to the
Noteholders the Noteholders' Interest Distribution Amount payable on such
Quarterly Payment Date, (C) pay to the Swap Counterparty all amounts owed by
the Trust to the Swap Counterparty under the Swap Agreement, (D) pay to the
Servicer and the Administrator all amounts owed to such entities under any of
the Basic Documents and (E) pay any unreimbursed draws under the Demand Note.
"Monthly Available Funds" means, with respect to each Monthly
Payment Date that is not a Quarterly Payment Date, the sum of the following
amounts with respect to the related Monthly Collection Period: (i) all
collections received by the Servicer on the Financed Student Loans during such
Collection Period and remitted to the Indenture Trustee (including any
Guarantee Payments received with respect to the Financed Student Loans); (ii)
any Interest
16
Subsidy Payments and Special Allowance Payments received by the Eligible
Lender Trustee during such Monthly Collection Period with respect to the
Financed Student Loans; (iii) all Liquidation Proceeds from any Financed
Student Loans which became Liquidated Student Loans during such Monthly
Collection Period in accordance with the Servicer's customary servicing
procedures, and all Recoveries in respect of Liquidated Student Loans which
were written off in prior Monthly Collection Periods, in each case which have
been received by the Servicer and remitted to the Indenture Trustee; (iv) the
aggregate Purchase Amounts received by the Indenture Trustee for those
Financed Student Loans repurchased by the Seller or purchased by the Servicer
under an obligation which arose during the related Monthly Collection Period;
(v) Investment Earnings for such Monthly Payment Date; and (vi) with respect
to each Monthly Payment Date other than a Quarterly Payment Date and other
than an Monthly Payment Date immediately succeeding a Quarterly Payment Date,
the Monthly Available Funds remaining from the Monthly Collection Period
relating to the preceding Monthly Payment Date after giving effect to the
application of such Monthly Available Funds on such preceding Monthly Payment
Date; provided, however, that if with respect to any Monthly Payment Date
there would not be sufficient funds, after application of the Monthly
Available Funds (as defined above) and amounts available first from the
Reserve Account and second from draws on the Demand Note (or, if applicable,
withdrawals from the Demand Note Account), to pay any of the items specified
in Section 2(d)(iv) of the Administration Agreement, then the Monthly
Available Funds for such Monthly Payment Date will include, in addition to the
Monthly Available Funds (as defined above), amounts on deposit in the
Collection Account on the Determination Date relating to such Monthly Payment
Date which would have constituted Monthly Available Funds for the Monthly
Payment Date succeeding such Monthly Payment Date up to the amount necessary
to pay such items, and the Monthly Available Funds for such succeeding Monthly
Payment Date will be adjusted accordingly; and provided, further, that the
Monthly Available Funds will exclude (A) all payments and proceeds (including
Liquidation Proceeds) of any Financed Student Loan the Purchase Amount of
which has been included in the Monthly Available Funds for a prior Monthly
Collection Period, (B) amounts released from the Prefunding Account, (C) any
Monthly Rebate Fees paid during the related Monthly Collection Period by or on
behalf of the Trust and (D) any collections in respect of principal on the
Financed Student Loans applied during the related Monthly Collection Period by
the Eligible Lender Trustee on behalf of the Trust after the end of the
Funding Period used to fund the addition of any Add-on Consolidation Loans or
to purchase Serial Loans during such Monthly Collection Period.
"Monthly Collection Period" means, with respect to any Monthly
Payment Date, the calendar month immediately preceding the month of such
Monthly Payment Date.
"Monthly Payment Date" means the twenty-fifth day of each month (or,
if any such date is not a Business Day, on the next succeeding Business Day)
commencing December 26, 2001.
"Monthly Rebate Fee" means, for each calendar month and with respect
to each Consolidation Loan that was originated on or after October 1, 1993
(except for Consolidation Loans referred to in clause (B) below), the fee
payable to the Department equal to the product of (x) one-twelfth, (y) (A)
with respect to all of the Consolidation Loans (other than those, the
17
applications of which have been received during the period from October 1,
1998 through January 31, 1999), 1.05% or (B) with respect to Consolidation
Loans, the applications of which have been received during the period from
October 1, 1998 through January 31, 1999, 0.62% and (z) the outstanding
principal balance of such Consolidation Loan (including any increases in the
principal balance of a Consolidation Loan due to the addition of the principal
balance of a related Add-on Consolidation Loan) plus accrued interest on such
Consolidation Loan as of the last day of such month.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Principal Cash Flow Amount" means, as of any date, the
Principal Cash Flow Amount (calculated for the Collection Period ending in the
preceding calendar month or, if no Collection Period ended in the preceding
calendar month, calculated for each preceding calendar month during the
current Collection Period) minus the Capitalized Interest Amount for such
Collection Period or for each such preceding calendar month, as the case may
be.
"91-Day Treasury Bills" means direct obligations of the United
States with a maturity of thirteen weeks.
"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 Rate" means any one of the Class A-1 Note Rate, the Class A-2
Note Rate or the Subordinate Note Rate, as the case may be.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.04 of the Indenture.
"Noteholder" means the Person in whose name a Note is registered in
the Note Register.
"Noteholders' Interest Distribution Amount" means, with respect to
any Quarterly Payment Date, the sum of the Class A-1 Noteholders' Interest
Distribution Amount, the Class A-2 Noteholders' Interest Distribution Amount
and the Subordinate Noteholders' Interest Distribution Amount.
"Notes" means, collectively, the Class A-1 Notes, Class A-2 Notes
and the Subordinate Notes.
"Obligor" on a Student Loan means the borrower or co-borrowers of
such Student Loan and any other Person who owes payments in respect of such
Student Loan, including the Guarantor thereof and, with respect to any
Interest Subsidy Payment or Special Allowance Payment, if any, thereon, the
Department.
18
"Officers' Certificate" means (i) in the case of the Issuer, a
certificate signed by any two Authorized Officers of the Issuer, under the
circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.01 of the Indenture, and delivered to the Indenture
Trustee and (ii) in the case of the Seller, the Servicer or the Administrator,
a certificate signed by any two Authorized Officers of the Seller, the
Servicer or the Administrator, as appropriate.
"Opinion of Counsel" means (i) with respect to the Issuer, one or
more written opinions of counsel who may, except as otherwise expressly
provided in the Indenture, be employees of or counsel to the Issuer and who
shall be satisfactory to the Indenture Trustee, and which opinion or opinions
shall be addressed to the Indenture Trustee as Indenture Trustee, shall comply
with any applicable requirements of Section 11.01 of the Indenture, and shall
be in form and substance satisfactory to the Indenture Trustee and (ii) with
respect to the Seller, the Administrator, the Servicer or a Federal Guarantor,
one or more written opinions of counsel who may be an employee of or counsel
to the Seller, the Administrator, the Servicer or such Federal Guarantor,
which counsel shall be acceptable to the Indenture Trustee, the Eligible
Lender Trustee or the Rating Agencies, as applicable.
"Outstanding" means, as of the date of determination, all Notes
theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore cancelled 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
(provided, however, that if such Notes are to be redeemed, notice of such
redemption has been duly given pursuant to the Indenture); and
(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, however, 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 Seller 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
Seller or any Affiliate of any of the foregoing Persons.
19
"Outstanding Amount" means the aggregate principal amount of all
Notes Outstanding at the date of determination.
"Parity Date" means the first Quarterly Payment Date on which the
aggregate principal amount of the Notes, after giving effect to all
distributions on such date, is no longer in excess of the sum of the Pool
Balance plus the amount on deposit in the Prefunding Account as of the last
day of the related Collection Period and plus the amount on deposit in the
Reserve Account as of such Quarterly Payment Date.
"Paying Agent" means Xxxxx Fargo Bank Minnesota, National
Association 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.
"Person" means any individual, corporation, estate, partnership,
joint venture, limited liability company, limited liability partnership,
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 as the
definition of "Delivery" above.
"PLUS Loan" means a Student Loan designated as such that is made
under the Parent Loans to Undergraduate Students Program pursuant to the
Higher Education Act.
"Pool Balance" means, as of the close of business on the last day of
any Collection Period, the aggregate principal balances of the Financed
Student Loans as of such day (including accrued interest thereon for the
immediately preceding Collection Period whether or not such interest will be
capitalized upon commencement of repayment), excluding any Purchased Student
Loans and Liquidated Student Loans.
"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 is the mutilated, lost, destroyed or stolen Note.
"Prefunded Loans" means those Financed Student Loans acquired by the
Issuer with funds on deposit in the Prefunding Account.
"Prefunding Account" means the account designated as such,
established and maintained pursuant to Section 2(c) of the Administration
Agreement, which shall be an Eligible Deposit Account.
"Prefunding Account Closing Date Deposit" means $50,000,000.
20
"Principal Cash Flow Amount" means, with respect to any Quarterly
Payment Date, the sum of the following amounts with respect to the related
Collection Period, or with respect to any other date of determination, the sum
of the following amounts with respect to the period specified: (i) that
portion of all collections received by the Servicer and remitted to the
Indenture Trustee on the Financed Student Loans that is allocable to principal
(including the portion of any Guarantee Payments received that is allocable to
principal of the Financed Student Loans); (ii) all Liquidation Proceeds
attributable to the principal amount of Financed Student Loans which became
Liquidated Student Loans during such Collection Period, or such other
specified period, in accordance with the Servicer's customary servicing
procedures and have been received by the Servicer during such Collection
Period and remitted to the Indenture Trustee, together with all Realized
Losses on such Financed Student Loans; (iii) to the extent attributable to
principal, the Purchase Amount received by the Indenture Trustee with respect
to each Financed Student Loan repurchased by the Seller or purchased by the
Servicer as a result of a breach of a representation, warranty or covenant
which arose during the related Collection Period or such other specified
period; and (iv) the Principal Distribution Adjustment; provided, however,
that the Principal Distribution Amount will exclude all payments and proceeds
(including Liquidation Proceeds) of any Financed Student Loans the Purchase
Amount of which has been included in Available Funds for a prior Collection
Period.
"Principal Distribution Adjustment" means, with respect to any
Quarterly Payment Date, the amount of the Available Funds on such Quarterly
Payment Date to be used to make additional principal distributions to
Noteholders to account for (i) the amount of any insignificant balance
remaining outstanding as of such Quarterly Payment Date on a Financed Student
Loan after receipt of a final payment from a Borrower or a Guarantor, when
such insignificant balances are waived in the ordinary course of business by
the Servicer at the direction of the Administrator in accordance with the
Servicing Agreement or (ii) the amount of principal collections erroneously
treated as interest collections including, without limitation, by reason of
the failure by a Borrower to capitalize interest that had been expected to be
capitalized; provided, however, that the Principal Distribution Adjustment for
any Quarterly Payment Date shall not exceed the lesser of (x) $100,000 and (y)
the amount of any Reserve Account Excess after giving effect to all
distributions to be made therefrom on such Quarterly Payment Date other than
distributions to the Depositor out of such excess.
"Principal Distribution Amount" means, with respect to any Quarterly
Payment Date, the Net Principal Cash Flow Amount for such Quarterly Payment
Date minus the sum of (i) any funds remitted to the Seller during the
preceding Collection Period but after the end of the Funding Period for the
Loan Purchase Amount of Serial Loans and (ii) any funds which are applied
during the preceding Collection Period but after the end of the Funding Period
to fund the addition of the principal balance of any Add-on Consolidation Loan
to the principal balance of a related Consolidation Loan.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Purchase Amount" means, with respect to a Financed Student Loan
other than a Serial Loan to be purchased from the Issuer, the amount required,
as of the close of business on
21
the last day of a Monthly Interest Period or Quarterly Interest Period, as
applicable, to prepay in full the respective Student Loan under the terms
thereof including all accrued borrower interest thereon; provided, however,
that the Purchase Amount for a Financed Student Loan, which is being
repurchased by the Seller as a result of a breach of the representation and
warranty provided for in the last sentence of the first paragraph of Exhibit C
to the Loan Sale Agreement will be calculated without regard to any amount
which the Seller has advanced with respect to such loan and which was not
reflected by the principal balance of such loan as of the Cutoff Date (or the
applicable Subsequent Cutoff Date, as the case may be) after the loan was sold
into the Trust.
"Purchased Student Loan" means a Financed Student Loan purchased as
of the close of business on the last day of a Monthly Collection Period or
Collection Period, as applicable, by the Servicer pursuant to Section 3.05 of
the Servicing Agreement or repurchased by the Seller pursuant to Section 3.02
of the Loan Sale Agreement.
"Qualified Substitute Student Loan" means a Student Loan that (i)
was originated under the same loan program and is guaranteed by a Guarantor
and entitles the holder thereof to receive interest based on the same interest
rate index as the related Deleted Student Loan for which it is to be
substituted, and (ii) will not, at any level of such interest rate index, have
an interest rate that is less than that of such Deleted Student Loan.
"Quarterly Payment Date" means the Monthly Payment Date occurring in
each February, May, August and November, commencing with the Monthly Payment
Date occurring in February 2002.
"Quarterly Interest Period" means, with respect to a Quarterly
Payment Date, the period from and including the Quarterly Payment Date
immediately preceding such Quarterly Payment Date (or in the case of the first
Quarterly Payment Date, the Closing Date) to but excluding such Quarterly
Payment Date.
"Rating Agency" means Xxxxx'x, S&P and Fitch and their successors.
"Rating Agency Condition" means, with respect to any action, that
each Rating Agency shall have been given ten days' prior notice thereof and
that each of the Rating Agencies shall have notified the Seller, the Servicer,
the Eligible Lender Trustee and the Indenture Trustee in writing that such
action will not result in and of itself in a reduction or withdrawal of the
then current rating of the Class A-1 Notes, the Class A-2 Notes or the
Subordinate Notes.
"Realized Losses" means the excess of the aggregate principal
balance of any Liquidated Student Loan plus accrued but unpaid interest
thereon over Liquidation Proceeds to the extent allocable to principal.
"Record Date" means, with respect to a Quarterly Payment Date or a
Redemption Date, the close of business on the twenty-fourth day of the
calendar month in which such Quarterly Payment Date or Redemption Date occurs
(whether or not such date is a Business Day).
22
"Recoveries" means, with respect to any Liquidated Student Loan, all
monies in respect thereof, from whatever source, that have been received by
the Servicer and remitted to the Indenture Trustee during any Monthly
Collection Period or Collection Period, as applicable, following the Monthly
Collection Period or Collection Period, as applicable, in which such Financed
Student Loan became a Liquidated Student Loan, net of the sum of all
reasonable amounts expended by the Servicer for the account of any Obligor to
the extent not previously reimbursed from Liquidation Proceeds or otherwise
and any amounts required by law to be remitted to the Obligor.
"Redemption Date" means in the case of a payment to the Noteholders
pursuant to Section 10.01 of the Indenture, the Quarterly Payment Date
specified by the Administrator or the Issuer pursuant to Section 10.01 (b) of
the Indenture.
"Redemption Price" means, in the case of a payment made to the
Noteholders pursuant to Section 10.01 (b) of the Indenture, the Outstanding
Amount of the Notes and all accrued and unpaid interest thereon.
"Reference Banks" means four major banks in the London interbank
market selected by the Administrator.
"Repayment" means the period of time during which a Borrower is
required to make installment payments to repay the aggregate principal amount
plus accrued interest of all amounts borrowed by virtue of the Borrower
Note(s) executed by such Borrower.
"Repayment Loan" means a Student Loan during a period of Repayment.
"Reserve Account" means the account designated as such, established
and maintained pursuant to Section 2(c) of the Administration Agreement, which
shall be an Eligible Deposit Account.
"Reserve Account Excess" has the meaning specified in Section
2(e)(ii) of the Administration Agreement.
"Reserve Account Initial Deposit" means $1,386,284.
"Responsible Officer" means, with respect to (i) the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture
Trustee, including any vice president, assistant vice president, assistant
treasurer, assistant secretary, or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the
above designated officers, with direct responsibility for the administration
of the Indenture and the other Basic Documents on behalf of the Indenture
Trustee and also, with respect to a particular matter, any other officer to
whom such matter is referred because of such officer's knowledge of and
familiarity with the particular subject and (ii) the Administrator, any
officer of the Administrator, including any vice president, assistant vice
president, assistant treasurer, assistant secretary, or any other officer of
the Administrator customarily performing functions similar to those performed
by any of the above designated officers, with direct responsibility for
23
the administration of the Administration Agreement and the other Basic
Documents on behalf of the Administrator and also, with respect to a
particular matter, any other officer to whom such matter is referred because
of such officer's knowledge of and familiarity with the particular subject.
"S&P" means Standard & Poor's, a division of The XxXxxx-Xxxx
Companies, Inc.
"Schedule of Student Loans" means the listing of the Financed
Student Loans set forth in Schedule A to the Loan Sale Agreement and to the
Indenture (which Schedule may be in the form of microfiche) as the same may be
amended from time to time.
"Secretary" means the Secretary of the Department, or any
predecessor or successor to the functions thereof under the Higher Education
Act.
"Securities Act" means the federal Securities Act of 1933, as
amended.
"Seller" means Xxxxx Fargo Bank South Dakota, National Association,
in its capacity as seller of the Financed Student Loans.
"Senior Noteholder" means the Noteholder of a Senior Note.
"Senior Noteholders' Distribution Amount" means, with respect to any
Quarterly Payment Date, the sum of the Class A-1 Noteholders' Interest
Distribution Amount, the Class A-2 Noteholders' Interest Distribution Amount
and the Senior Noteholders' Principal Distribution Amount for such Quarterly
Payment Date.
"Senior Noteholders' Interest Distribution Amount" means, with
respect to any Quarterly Payment Date, the sum of (i) the Class A-1
Noteholders' Interest Distribution Amount and (ii) the Class A-2 Noteholders'
Interest Distribution Amount, each for such Quarterly Payment Date.
"Senior Noteholders' Principal Carryover Shortfall" means, as of the
close of any Quarterly Payment Date, the excess of (i) the Senior Noteholders'
Principal Distribution Amount on such Quarterly Payment Date over (ii) the
amount of principal actually distributed to the Senior Noteholders on such
Quarterly Payment Date.
"Senior Noteholders' Principal Distribution Amount" means, with
respect to any Quarterly Payment Date, the Principal Distribution Amount for
such Quarterly Payment Date plus the Senior Noteholders' Principal Carryover
Shortfall as of the close of the preceding Quarterly Payment Date; provided,
however, that the Senior Noteholders' Principal Distribution Amount will not
exceed the outstanding aggregate principal balance of the Senior Notes. In
addition, (i) on the Class A-1 Note Final Maturity Date, the principal
required to be distributed to Class A-1 Noteholders will include the amount
required to reduce the outstanding principal balance of the Class A-1 Notes to
zero and (ii) on the Class A-2 Note Final Maturity Date, the
24
principal required to be distributed to Class A-2 Noteholders will include the
amount required to reduce the outstanding principal balance of the Class A-2
Notes to zero.
"Senior Notes" means, collectively, the Class A-1 Notes and the
Class A-2 Notes.
"Serial Loan" means a Financed Student Loan which (i) is made by an
eligible lender under the Higher Education Act to a Borrower who is also a
Borrower under at least one outstanding Financed Student Loan and is acquired
by the Seller, (ii) is made under the same federal loan program as such
Financed Student Loan, (iii) has the same Guarantor as such Financed Student
Loan and (iv) has a final maturity date during or before the Collection Period
preceding the Subordinate Note Final Maturity Date.
"Servicer" means Xxxxx Fargo Bank South Dakota, National
Association, in its capacity as servicer of the Financed Student Loans or any
permitted Successor Servicer.
"Servicer Default" means an event specified in Section 6.01 of the
Servicing Agreement.
"Servicer Liability Limit" has the meaning specified in Section
3.05(a) of the Servicing Agreement.
"Servicer Liability Period" has the meaning specified in Section
3.05(a) of the Servicing Agreement.
"Servicing Agreement" means the Servicing Agreement dated as of
November 1, 2001, among the Issuer, the Servicer, the Depositor and the
Eligible Lender Trustee.
"Servicing Fee" has the meaning specified in Section 3.06 of the
Servicing Agreement.
"SLS Loan" means a Student Loan designated as such that is made
under the Supplemental Loans for Students Program pursuant to the Higher
Education Act.
"Special Allowance Payments" means payments, designated as such,
consisting of effective interest subsidies by the Department in respect of the
Financed Student Loans to the Eligible Lender Trustee on behalf of the Trust
in accordance with the Higher Education Act.
"Specified Reserve Account Balance" with respect to any Quarterly
Payment Date means the greatest of (a) 0.25% of the principal balance of the
Notes after taking into account the effect of distributions on such Quarterly
Payment Date and (b) $500,000 after giving effect to payments on the Quarterly
Payment Date; provided, however, that in no event shall the Specified Reserve
Account Balance exceed the outstanding principal balance of the Notes.
"Xxxxxxxx Loan" means a Student Loan designated as such that is made
under the Xxxxxx X. Xxxxxxxx Student Loan Program in accordance with the
Higher Education Act.
25
"State" means any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx xx
Xxxxxxx, the trust territories of the United States, or the District of
Columbia.
"Student Loan" means an agreement to repay a disbursement of money
to or on behalf of an eligible student, evidenced by a Borrower Note and
guaranteed in accordance with the policies and procedures of a Federal
Guarantor.
"Student Loan Files" means the documents relating to the Financed
Student Loans specified in Section 2.01 of the Servicing Agreement.
"Student Loan Rate Accrual Period" means, with respect to any
Quarterly Payment Date, the Collection Period preceding such Quarterly Payment
Date.
"Subordinate Note" means a Class B Floating Rate Asset-Backed
Subordinate Note issued pursuant to the Indenture, substantially in the form
of Exhibit A-3 thereto.
"Subordinate Note Final Maturity Date" means the August 2035
Quarterly Payment Date.
"Subordinate Note Pool Factor" as of the close of business on a
Quarterly Payment Date means a seven-digit decimal figure equal to the
outstanding principal balance of the Subordinate Notes divided by the original
outstanding principal balance of the Subordinate Notes. The Subordinate Note
Pool Factor will be 1.0000000 as of the Closing Date; thereafter, the
Subordinate Note Pool Factor will decline to reflect reductions in the
outstanding principal balance of the Subordinate Notes.
"Subordinate Note Rate" means, with respect to any Quarterly Payment
Date and the related Quarterly Interest Period, the interest rate per annum
(computed on the basis of the actual number of days in such Quarterly Interest
Period over a year of 360 days) equal to Three-Month LIBOR for the related
LIBOR Reset Period plus 0.50% and (ii) plus an additional 0.50% with respect
to each succeeding Quarterly Interest Period commencing on the first Quarterly
Payment Date as of which the Servicer has the right to purchase the Financed
Student Loans pursuant to Section 7.01 of the Servicing Agreement, if the
Servicer has not exercised such right on such Quarterly Payment Date.
"Subordinate Noteholder" means the Noteholder of a Subordinate Note.
"Subordinate Noteholders' Distribution Amount" means, with respect
to any Quarterly Payment Date, the Subordinate Noteholders' Interest
Distribution Amount for such Quarterly Payment Date plus, with respect to any
Quarterly Payment Date on and after which the Senior Notes have been paid in
full, the Subordinate Noteholders' Principal Distribution Amount for such
Quarterly Payment Date.
"Subordinate Noteholders' Interest Carryover Shortfall" means, with
respect to any Quarterly Payment Date, the excess of (i) the Subordinate
Noteholders' Interest Distribution Amount on the preceding Quarterly Payment
Date over (ii) the amount of interest actually
26
distributed to the Subordinate Noteholders on such preceding Quarterly Payment
Date, plus interest on the amount of such excess, to the extent permitted by
law, at the then current Subordinate Note Rate from such preceding Quarterly
Payment Date to the current Quarterly Payment Date.
"Subordinate Noteholders' Interest Distribution Amount" means, with
respect to any Quarterly Payment Date, the sum of (i) the amount of interest
accrued at the Subordinate Note Rate for the related Quarterly Interest Period
on the aggregate principal amount of the Subordinate Notes outstanding on the
immediately preceding Quarterly Payment Date (after giving effect to all
principal distributions to Subordinate Noteholders on such Quarterly Payment
Date) or, in the case of the first Quarterly Payment Date, on the Closing Date
and (ii) the Subordinate Noteholders' Interest Carryover Shortfall for such
Quarterly Payment Date.
"Subordinate Noteholders' Principal Carryover Shortfall" means, as
of the close of any Quarterly Payment Date on or after which the Senior Notes
have been paid in full, the excess of (i) the Subordinate Noteholders'
Principal Distribution Amount on such Quarterly Payment Date over (ii) the
amount of principal actually distributed to the Subordinate Noteholders on
such Quarterly Payment Date.
"Subordinate Noteholders' Principal Distribution Amount" means, with
respect to each Quarterly Payment Date on and after which the aggregate
principal amount of the Senior Notes has been paid in full, the sum of (a) the
Principal Distribution Amount for such Quarterly Payment Date (or, in the case
of the Quarterly Payment Date on which the aggregate principal balance of the
Senior Notes is paid in full, any remaining Principal Distribution Amount not
otherwise distributed to the Senior Noteholders on such Quarterly Payment
Date) and (b) the Subordinate Noteholders' Principal Carryover Shortfall as of
the close of the preceding Quarterly Payment Date; provided, however, that the
Subordinate Noteholders' Principal Distribution Amount will in no event exceed
the aggregate principal amount of the Subordinate Notes outstanding on such
date. In addition, on the Subordinate Note Final Maturity Date, the principal
required to be distributed to the Subordinate Noteholders will include the
amount required to reduce the outstanding principal amount of the Subordinate
Notes to zero.
"Subsequent Cutoff Date" means for Prefunded Loans or Serial Loans,
the date as of which any Prefunded Loan or Serial Loan is transferred to the
Issuer and the date on and after which all distributions on such loan are
property of the Issuer or the date of the related Assignment in the case of
any Qualified Substitute Student Loan.
"Subservicer" means any subservicer appointed in accordance with
Section 3.12 of the Servicing Agreement.
"Subservicing Agreement" means any agreement entered into between
the Servicer and a Subservicer containing the terms under which the
Subservicer shall service, and otherwise act with respect to, all or certain
of the Financed Student Loans.
"Substitution Adjustment Amount" has the meaning specified in
Section 3.02 of the Loan Sale Agreement.
27
"Successor Servicer" has the meaning specified in Section 3.07(e) of
the Indenture.
"Swap Agreement" means the interest rate swap agreement, entered
into by and between the Trust with the Swap Counterparty pursuant to a 1992
ISDA Master Agreement (Multicurrency-Cross Border), together with the schedule
thereto and the confirmation thereunder and any replacement swap agreement
entered into in accordance with the Basic Documents.
"Swap Counterparty" means Xxxxx Fargo Bank, National Association and
any replacement swap counterparty appointed in accordance with the terms of
the Swap Agreement.
"Swap Default" means an event of default under the Swap Agreement.
"Swap Fee" means, with respect to each Quarterly Payment Date while
the Swap Agreement is in effect, a fee equal to 0.04% per annum on the
outstanding principal balance for each Class of Notes on the day immediately
preceding that Quarterly Payment Date.
"Telerate Page 3750" means the display page so designated on the Dow
Xxxxx Telerate Service (or such other page as may replace that page on any
service for the purpose of displaying comparable rates or prices).
"Three-Month LIBOR" means, with respect to any LIBOR Reset Period,
the London interbank offered rate for deposits in U.S. dollars having a
maturity of three months commencing on the related LIBOR Determination Date
(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 The City
of New York, selected by the Administrator, at approximately 11:00 a.m., New
York 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
equal to an amount of not less than U.S. $1,000,000; provided, however, that
if the banks selected as aforesaid are not quoting as mentioned in this
sentence, Three-Month LIBOR in effect for the applicable LIBOR Reset Period
will be the Three-Month LIBOR in effect for the previous LIBOR Reset Period.
"Transfer" means any direct or indirect transfer, sale, pledge,
hypothecation or other form of assignment of any ownership interest in a Note
or, with respect Section 3.01 of the Trust Agreement, in the Trust.
28
"Transfer Agreement" has the meaning provided in Section 2.03 of the
Loan Sale Agreement.
"Transfer Date" means the day fixed for the transfer of any New
Loans, Serial Loans or Prefunded Loans by the Seller to the Depositor and by
the Depositor to the Issuer pursuant to Section 2.02(a) of the Loan Sale
Agreement.
"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 Deposit, the
Prefunding Account Closing Date Deposit and the Collection Account Closing
Date Deposit and all proceeds of the foregoing.
"Trust Accounts" has the meaning specified in Section 2(c) of the
Administration Agreement.
"Trust Agreement" means the Trust Agreement dated as of November 1,
2001, among the Depositor and the Eligible Lender Trustee.
"Trust Estate" means all right, title and interest of the Trust (or
the Eligible Lender Trustee on behalf of the Trust) in and to the property and
rights assigned to the Trust pursuant to Article II of the Loan Sale Agreement
all funds on deposit from time to time in the Trust Accounts and all other
property of the Trust from time to time, including any rights of the Eligible
Lender Trustee and the Trust pursuant to the Loan Sale Agreement, the
Servicing Agreement and the Administration Agreement.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939
as in force on the date hereof, unless otherwise specifically provided.
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from
time to time.
"United States Person" means a citizen or resident of the United
States, a corporation, partnership or other entity created or organized in, or
under the laws of, the United States or any political subdivision thereof, or
an estate whose income is subject to United States federal income tax
regardless of its source, or a trust if a court within the United States is
able to exercise primary supervision over the administration of the trust and
one or more United States fiduciaries have the authority to control all
substantial decisions of the trust.
