Exhibit 99.3
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SLM STUDENT LOAN TRUST 2004-4
ADMINISTRATION AGREEMENT
DATED AS XX XXX 0, 0000
XXXXX
XXX FUNDING LLC
SLM STUDENT LOAN TRUST 2004-4
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
AS ELIGIBLE LENDER TRUSTEE
XXXXXX XXX, INC.
AND
DEUTSCHE BANK TRUST COMPANY AMERICAS,
AS INDENTURE TRUSTEE
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TABLE OF CONTENTS
Dated as of May 5, 2004
ARTICLE I
Section 1.1 Definitions and Usage........................................................................ 2
ARTICLE II
Section 2.1 Duties with Respect to the Indenture......................................................... 2
Section 2.2 Duties with Respect to the Issuer............................................................ 4
Section 2.3 Establishment of Trust Accounts.............................................................. 5
Section 2.4 Collections.................................................................................. 7
Section 2.5 Application of Collections................................................................... 8
Section 2.6 Additional Deposits.......................................................................... 8
Section 2.7 Distributions................................................................................ 9
Section 2.8 Priority of Distributions.................................................................... 10
Section 2.9 Reserve Account.............................................................................. 11
Section 2.10 Investment Earnings; Other Trust Accounts.................................................... 12
Section 2.11 Statements to Excess Distribution Certificateholder and Noteholders.......................... 13
Section 2.12 Non-Ministerial Matters...................................................................... 14
Section 2.13 Exceptions................................................................................... 14
Section 2.14 Compensation................................................................................. 15
Section 2.15 Servicer and Administrator Expenses.......................................................... 15
ARTICLE III
Section 3.1 Administrator's Certificate; Servicer's Report............................................... 15
Section 3.2 Annual Statement as to Compliance; Notice of Default; Financial Statements................... 16
Section 3.3 Annual Independent Certified Public Accountants' Report...................................... 17
ARTICLE IV
Section 4.1 Representations of Administrator............................................................. 17
Section 4.2 Liability of Administrator; Indemnities...................................................... 18
Section 4.3 Merger or Consolidation of, or Assumption of the............................................. 20
Section 4.4 Limitation on Liability of Seller, Administrator and Others.................................. 21
Section 4.5 Administrator May Own Certificates or Notes.................................................. 22
Section 4.6 Xxxxxx Mae, Inc. Not to Resign as Administrator.............................................. 22
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ARTICLE V
Section 5.1 Administrator Default........................................................................ 22
Section 5.2 Appointment of Successor..................................................................... 23
Section 5.3 Notification to Noteholders and Certificateholders........................................... 24
Section 5.4 Waiver of Past Defaults...................................................................... 24
ARTICLE VI
Section 6.1 Termination.................................................................................. 25
ARTICLE VII
Section 7.1 Protection of Interests in Trust............................................................. 25
ARTICLE VIII
Section 8.1 Independence of the Administrator............................................................ 28
Section 8.2 No Joint Venture............................................................................. 28
Section 8.3 Other Activities of Administrator............................................................ 28
Section 8.4 Powers of Attorney........................................................................... 28
Section 8.5 Amendment.................................................................................... 28
Section 8.6 Assignment................................................................................... 29
Section 8.7 Limitations on Rights of Others.............................................................. 30
Section 8.8 Assignment to Indenture Trustee.............................................................. 30
Section 8.9 Nonpetition Covenants........................................................................ 30
Section 8.10 Limitation of Liability of Eligible Lender Trustee and Indenture Trustee..................... 31
Section 8.11 Governing Law................................................................................ 31
Section 8.12 Headings..................................................................................... 31
Section 8.13 Counterparts................................................................................. 31
Section 8.14 Severability................................................................................. 31
Section 8.15 Excess Distribution Certificate.............................................................. 31
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ADMINISTRATION AGREEMENT
SLM Student Loan Trust 2004-4 Administration Agreement, dated as of May
5, 2004 (this "Agreement"), among SLM Funding LLC (the "Depositor"), SLM Student
Loan Trust 0000-0 (xxx "Xxxxxx"), Xxxxx Xxxxxxxxx Bank USA, National
Association, not in its individual capacity but solely in its capacity as
eligible lender trustee (in such capacity, the "Eligible Lender Trustee"),
Deutsche Bank Trust Company Americas, not in its individual capacity but solely
in its capacity as indenture trustee (in such capacity, the "Indenture
Trustee"), Xxxxxx Xxx, Inc., not in its individual capacity but solely in its
capacity as servicer (in such capacity, the "Servicer"), and Xxxxxx Mae, Inc.,
not its individual capacity but solely in its capacity as administrator (in such
capacity, the "Administrator").
RECITALS
WHEREAS, pursuant to an Indenture, dated as of May 1, 2004 (the
"Indenture"), among the Issuer, the Indenture Trustee and the Eligible Lender
Trustee, the Issuer (a) is issuing (i) five classes of its Student Loan-Backed
Notes (collectively, the "Notes") pursuant to the Indenture, and (ii) an Excess
Distribution Certificate (the "Excess Distribution Certificate") pursuant to the
Short-Form Trust Agreement, dated as of April 22, 2004 between the Depositor and
the Eligible Lender Trustee, pursuant to which the Issuer was established, as
amended and restated by the Amended and Restated Trust Agreement, dated as of
May 5, 2004 (the "Trust Agreement"), among the Depositor, the Eligible Lender
Trustee and the Indenture Trustee, and (b) will not issue any other classes of
certificates (the "Certificates");
WHEREAS, the Issuer has entered into certain agreements in connection
with the issuance of the Notes and the Excess Distribution Certificate,
including the Trust Agreement, the Servicing Agreement, the Sale Agreement, the
Indenture and the Interest Rate Cap Agreement;
WHEREAS, pursuant to certain Basic Documents, the Issuer and the
Eligible Lender Trustee are required to perform certain duties in connection
with (a) the Notes and the Collateral therefore pledged pursuant to the
Indenture and (b) the Excess Distribution Certificate pursuant to the Trust
Agreement;
WHEREAS, the Issuer and the Eligible Lender Trustee desire to have the
Administrator and the Servicer 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 this Agreement and the other Basic
Documents as the Issuer and the Eligible Lender Trustee may from time to time
request; and
WHEREAS, the Administrator and the Servicer have the capacity to
provide the services required hereby and are 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 Depositor, the Issuer, the Eligible Lender Trustee, the
Indenture Trustee, the Servicer, and the Administrator, hereby agree as follows:
ARTICLE I
Section 1.1 Definitions and Usage. Except as otherwise specified herein
or as the context may otherwise require, capitalized terms used but not
otherwise defined herein are defined in Appendix A to the Indenture, which also
contains rules as to usage that shall be applicable herein.
ARTICLE II
Section 2.1 Duties with Respect to the Indenture. The Administrator
agrees to consult with the Eligible Lender Trustee regarding the duties of the
Issuer under the Indenture and the Depository Agreement. 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
Indenture and the Depository Agreement. 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 Indenture and the Depository Agreement. In furtherance of the
foregoing, the Administrator shall take the actions with respect to the
following matters that it is the duty of the Issuer or the Indenture Trustee to
take pursuant to the Indenture:
(a) preparing or obtaining the documents and instruments
required for authentication of the Notes and delivering the same to the
Indenture Trustee (Section 2.2 of the Indenture);
(b) preparing, obtaining or filing the instruments, opinions
and certificates and other documents required for the release of
Collateral (Section 2.9 of the Indenture);
(c) obtaining and preserving 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 3.4 of the
Indenture);
(d) preparing all supplements, amendments, financing
statements, continuation statements, instruments of further assurance
and other instruments, in accordance with Section 3.5 of the Indenture,
necessary to protect the Indenture Trust Estate (Section 3.5 of the
Indenture);
(e) delivering the Opinion of Counsel on the Closing Date and
the annual delivery of Opinions of Counsel, in accordance with Section
3.6 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 3.9 of the Indenture, as to
compliance, with the Indenture (Sections 3.6 and 3.9 of the Indenture);
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(f) in the event of a Servicer Default, the taking of all
reasonable steps available to enforce the Issuer's rights under the
Basic Documents in respect of such Servicer Default (Section 3.7(d) of
the Indenture);
(g) preparing and obtaining the documents and instruments
required for the release of the Issuer from its obligations under the
Indenture (Section 3.10 of the Indenture);
(h) monitoring the Issuer's obligations as to the satisfaction
and discharge of the Indenture and preparing an Officers' Certificate
of the Issuer and obtaining of the Opinion of Counsel and the
Independent Certificate relating thereto (Section 4.1 of the
Indenture);
(i) selling of the Indenture Trust Estate in a commercially
reasonable manner if an Event of Default resulting in a
non-rescindable, non-waivable acceleration of the Notes has occurred
and is continuing (Section 5.4 of the Indenture);
(j) preparing and, after execution by the Issuer, filing with
the Commission, any applicable State agencies and the Indenture Trustee
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 (Section 7.3 of the
Indenture);
(k) opening of one or more accounts in the Issuer's name,
preparing Issuer Orders and Officers' Certificates of the Issuer,
obtaining the Opinions of Counsel and all other actions necessary with
respect to investment and reinvestment of funds in the Trust Accounts
(Sections 8.2 and 8.3 of the Indenture);
(l) preparing 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 8.4 and 8.5 of the Indenture);
(m) preparing Issuer Orders and obtaining of Opinions of
Counsel with respect to the execution of supplemental indentures
(Sections 9.1, 9.2 and 9.3 of the Indenture);
(n) preparing 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 9.6 of
the Indenture);
(o) preparing all Officers' Certificates of the Issuer and
obtaining any Independent Certificates and/or Opinions of Counsel with
respect to any requests by the Issuer to the Indenture Trustee to take
any action under the Indenture (Section 11.1(a) of the Indenture);
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(p) preparing and delivering of Officers' Certificates of the
Issuer and obtaining any Independent Certificates, if necessary, for
the release of property from the lien of the Indenture (Section 11.1(b)
of the Indenture);
(q) preparing and delivering to Noteholders and the Indenture
Trustee any agreements with respect to alternate payment and notice
provisions (Section 11.6 of the Indenture);
(r) recording the Indenture, if applicable (Section 11.15 of
the Indenture);
(s) undertaking all obligations required to be performed by
the Administrator, including, without limitation, preparing and
delivering all notices, communications, information and calculations,
under the Interest Rate Cap Agreement;
(t) on the Closing Date, directing the Eligible Lender Trustee
to enter into the Interest Rate Cap Agreement (not in its individual
capacity, but solely on behalf of the Trust) with the Interest Rate Cap
Counterparty;
(u) calculating on each Distribution Date, as applicable, the
Principal Distribution Amount and any applicable Specified Reserve
Account Balance; and
(v) calculating on or before each Distribution Date, as
applicable, any amounts to be deposited in, or withdrawn from, each
Trust Account.
Section 2.2 Duties with Respect to the Issuer.
(a) In addition to the duties of the Administrator set forth
above and in the other Basic Documents, the Administrator shall perform
such calculations, including calculating on each LIBOR Determination
Date, the applicable rate of interest for the applicable Accrual
Period, 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. Subject to Section 8.1 below, 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.
(b) The Administrator shall be responsible for performance of
the duties of the Eligible Lender Trustee set forth in Section 5.4 of
the Trust Agreement and the Administrator shall be entitled to hire an
Independent accounting firm to perform the duties described therein,
the reasonable fees and expenses of which shall be paid by the
Depositor or the holder of the Excess Distribution Certificate, if not
then held by the Depositor.
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(c) The Administrator shall perform the duties of the
Administrator specified in Section 10.2 of the Trust Agreement required
to be performed in connection with the resignation or removal of the
Eligible Lender Trustee, and any other duties expressly required to be
performed by the Administrator under the Trust Agreement and the other
Basic Documents.
(d) The Administrator shall be responsible for preparing and
delivering, on behalf of the Issuer, (i) all notices required by any
Clearing Agency or stock exchange upon which the Notes are then listed
and (ii) any information required to effectuate the listing of the
Notes on a stock exchange of international standing and, if applicable,
the transfer of the listing of the Notes to an alternative stock
exchange of international standing.
(e) The Administrator shall be responsible for serving as
Calculation Agent or as successor calculation agent, if required, and
shall be responsible for preparing any notices required to be delivered
by the Issuer to the Interest Rate Cap Counterparty under the Interest
Rate Cap Agreement, as applicable, including, without limitation, any
notice obligations specified in the Interest Rate Cap Agreement in the
event of a default by the Interest Rate Cap Counterparty.
(f) 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 the Administrator's opinion, no less favorable to the
Issuer than would be available from unaffiliated parties.
Section 2.3 Establishment of Trust Accounts.
(a) On the Closing Date and at such other times as specified
herein, the Administrator shall establish the following Eligible Deposit
Accounts as more fully described below:
(i) a "Collection Account"; and
(ii) a "Reserve Account".
(b) Funds on deposit in each account specified in Section
2.3(a) above (collectively, the "Trust Accounts") shall be invested by the
Indenture Trustee (or any custodian or designated agent with respect to any
amounts on deposit in such accounts) in Eligible Investments (including Eligible
Investments of the Indenture Trustee) pursuant to written instructions by the
Administrator; provided, however, it is understood and agreed that the Indenture
Trustee shall not be liable for the selection of, or 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 Issuer; provided that on the Business Day preceding each Distribution Date,
all interest and other investment income (net of losses and investment expenses)
on funds on deposit therein shall be deposited into the Collection Account and
shall be deemed to constitute a portion of the Available Funds for such
Distribution Date. Other than as described in the following proviso or as
otherwise permitted by the Rating
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Agencies, funds on deposit in the Trust Accounts shall only be invested in
Eligible Investments that will mature so that such funds will be available at
the close of business on the Business Day preceding the following Monthly
Servicing Payment Date (to the extent necessary to pay the Primary Servicing Fee
payable on such date) or the following Distribution Date. Funds deposited in a
Trust Account on a Business Day which immediately precedes a Monthly Servicing
Payment Date or Distribution Date upon the maturity of any Eligible Investments
are not required to be invested overnight.
(c) The Depositor and the Issuer pledged to the Indenture
Trustee all of their respective right, title and interest in all funds on
deposit from time to time in the Trust Accounts and in all proceeds thereof
(including all income thereon) and all such funds, investments, proceeds and
income shall be part of the Trust Estate. Subject to the Administrator's power
to instruct the Indenture Trustee pursuant to Section 2.3(b) above and Section
2.3(e) below, the Trust Accounts shall be under the sole dominion and control of
the Indenture Trustee for the benefit of the Noteholders and the Issuer. If, at
any time, any Trust Account 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.
(d) With respect to the Trust Account Property, the Indenture
Trustee agrees, by its acceptance hereof, that:
(i) any Trust Account Property that is held in
deposit accounts shall be held solely in Eligible Deposit Accounts, subject to
the last sentence of Section 2.3(c) and, subject to Section 2.3(b), each such
Eligible Deposit Account shall be subject to the exclusive custody and control
of the Indenture Trustee, and the Indenture Trustee shall have sole signature
authority with respect thereto;
(ii) 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" and shall be held, pending
maturity or disposition, solely by the Indenture Trustee or a financial
intermediary (as such term is defined in Section 8-313(4) of the UCC) acting
solely for the Indenture Trustee;
(iii) 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 shall be maintained by the Indenture Trustee,
pending maturity or disposition, through continuous book-entry registration of
such Trust Account Property as described in such paragraph; and
(iv) any Trust Account Property that is an
"uncertificated security" under Article 8 of the UCC and that is not governed by
clause (iii) above shall be Delivered to
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the Indenture Trustee in accordance with paragraph (c) of the definition of
"Delivery" and shall be maintained by the Indenture Trustee, pending maturity or
disposition, through continued registration of the Indenture Trustee's (or its
nominee's) ownership of such security.
Notwithstanding anything to the contrary set forth in this Section 2.3(d), the
Indenture Trustee shall have no liability or obligation in respect of any failed
Delivery, as contemplated herein, other than with respect to a Delivery which
fails as a result of any action or inaction on behalf of the Indenture Trustee.
(e) 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, the Administrator
or the Eligible Lender Trustee to carry out its respective duties
hereunder or permitting the Indenture Trustee to carry out its duties
under the Indenture.
(f) On the Closing Date, the Administrator, for the benefit of
the Noteholders and the Trust, shall establish and maintain in the name
of the Indenture Trustee an Eligible Deposit Account (the "Collection
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Trust. The Collection
Account will initially be established as a segregated trust account in
the name of the Indenture Trustee with the corporate trust department
of Deutsche Bank Trust Company Americas.
(g) On the Closing Date, the Administrator, for the benefit of
the Noteholders and the Trust, shall establish and maintain in the name
of the Indenture Trustee an Eligible Deposit Account (the "Reserve
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Trust. The Reserve
Account will initially be established as a segregated trust account in
the name of the Indenture Trustee with the corporate trust department
of Deutsche Bank Trust Company Americas. On the Closing Date, the
Administrator shall cause the Trust to deposit the Reserve Account
Initial Deposit into the Reserve Account.
Section 2.4 Collections. The Servicer shall remit within two Business
Days of receipt thereof to the Collection Account all payments by or on behalf
of the Obligors with respect to the Trust Student Loans (other than Purchased
Student Loans), and all Liquidation Proceeds, both as collected during the
Collection Period, and the Eligible Lender Trustee shall remit within two
Business Days of receipt thereof to the Collection Account any Interest Subsidy
Payments and Special Allowance Payments received by it with respect to the Trust
Student Loans during the Collection Period. Notwithstanding the foregoing, for
so long as (a) the senior unsecured obligations of the Administrator (or any
affiliate of the Administrator which guarantees the obligations of the
Administrator hereunder) are then assigned a long-term rating of not less than
"AA-" (or an equivalent rating) or a short-term rating of not less than "A-1"
(or an equivalent rating) by each of the Rating Agencies or the remitting by the
Servicer and the Eligible Lender Trustee of the amounts referred to in this
Section 2.4 to the Administrator will not result in a downgrading or withdrawal
of any of the then-current ratings of any of the Notes by any of the
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Rating Agencies, and (b) no Administrator Default shall have occurred and be
continuing, the Servicer and the Eligible Lender Trustee shall remit such
collections within two Business Days of receipt thereof to the Administrator,
and the Administrator need not deposit such collections into the Collection
Account until one Business Day immediately prior to the next following Monthly
Servicing Payment Date (in an amount up to the Servicing Fee then due) or
Distribution Date together with interest on such amounts (less Servicing Fees
paid during such period) calculated on a daily basis from the first day of the
month following receipt thereof by the Administrator through the last day of the
related Collection Period at a rate equal to no less than the Federal Funds Rate
less 0.20%. In the event that the Administrator (and each such Affiliate which
guarantees the obligations of the Administrator) is rated below "AA-" and "A-1"
by S&P, the Administrator shall deposit all such collections into the Collection
Account at least as frequently as the next following Monthly Servicing Payment
Date, unless less frequent deposits will not result in a downgrading or
withdrawal of S&P's then-current ratings on the Notes. In the event that any of
the foregoing conditions for ceasing daily remittances shall no longer be
satisfied, then the Administrator shall deposit all collections held by it into
the Collection Account within two Business Days of receipt thereof.
Section 2.5 Application of Collections.
(a) With respect to each Trust Student Loan, all collections
(including all Guarantee Payments) with respect thereto for each Collection
Period shall be applied to interest and principal on such Trust Student Loan by
the Servicer in accordance with its customary practice.
(b) All Liquidation Proceeds shall be applied to the related
Trust Student Loan.
Section 2.6 Additional Deposits.
(c) The Servicer shall deposit or cause to be deposited in the
Collection Account the aggregate purchase price with respect to Purchased
Student Loans as determined pursuant to Section 3.5 of the Servicing Agreement
and all other amounts to be paid by the Servicer under Section 3.5 of the
Servicing Agreement on or before the third Business Day before the related
Distribution Date, and the Depositor shall deposit or cause to be deposited in
the Collection Account the aggregate Purchase Amount with respect to Purchased
Student Loans and all other amounts to be paid by the Depositor under Section 6
of the Sale Agreement when such amounts are due.
(d) Notwithstanding anything to the contrary set forth in
Section 2.6(a) above, if daily deposits to the Collection Account are not
required pursuant to Section 2.4 above, the Depositor and the Servicer shall pay
the amounts referred to in Section 2.6(a) above that would otherwise be
deposited into the Collection Account to the Administrator. The Administrator
shall not be required to deposit such amounts into the Collection Account until
the Business Day preceding each Distribution Date; provided, however, that, on
or before the Business Day preceding each Monthly Servicing Payment Date that is
not a Distribution Date, the Administrator shall deposit into the Collection
Account that portion of such amounts received by it that is equal to the Primary
Servicing Fee payable on such date and provided,
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further that the Administrator shall also deposit into the Collection Account on
such date interest on such amounts (less Servicing Fees paid during such period)
calculated on a daily basis from the first day of the month following receipt
thereof by the Administrator through the last day of the related Collection
Period at a rate equal to no less than the Federal Funds Rate less 0.20%.
Section 2.7 Distributions.
(e) On or before the second Business Day immediately preceding
each Distribution Date, the Administrator shall calculate all amounts required
to be deposited into the Collection Account from the Trust Accounts, as
applicable, including the amount of all Investment Earnings to be transferred
from the Trust Accounts to the Collection Account, and the amount to be
distributed from the Collection Account as Available Funds and pursuant to
paragraph (a)(2) of the definition of Available Funds on the related
Distribution Date. On the fifth Business Day preceding each Monthly Servicing
Payment Date that is not a Distribution Date, as applicable, the Administrator
shall calculate all amounts required to be deposited into the Collection Account
from the Reserve Account and the amounts to be distributed therefrom on the
related Monthly Servicing Payment Date. In addition, the Administrator shall:
(i) calculate all amounts required to be deposited
into the Collection Account from the Reserve Account on or before the
second Business Day preceding each Distribution Date; and
(ii) calculate, in each case, if and to the extent
applicable, the Class A Noteholders' Distribution Amount, the Class B
Noteholders' Distribution Amount and the Specified Reserve Account
Balance on or before the second Business Day immediately preceding such
Distribution Date;
(f) The Administrator shall instruct the Indenture Trustee in
writing no later than the second Business Day preceding each Monthly Servicing
Payment Date that is not a Distribution Date (based on the information contained
in the Administrator's Officers' Certificate and the related Servicer's Report
delivered pursuant to Section 3.1(a) and (b) below) to distribute to the
Servicer, by 1:00 p.m. (New York time) on such Monthly Servicing Payment Date,
from and to the extent of the Available Funds on deposit in the Collection
Account the Primary Servicing Fee due with respect to the preceding calendar
month, and the Indenture Trustee shall comply with such instructions.
(g) The Administrator shall instruct the Indenture Trustee in
writing no later than one Business Day preceding each Distribution Date (based
on the information contained in the Administrator's Certificate and the related
Servicer's Report delivered pursuant to Sections 3.1(a) and 3.1(c) below) to
make the deposits and distributions set forth in Section 2.8 to the Persons or
to the account specified below by 1:00 p.m. (New York time) on such Distribution
Date (provided that funds are not required to be distributed pursuant to Section
5.4(b) of the Indenture). These deposits and distributions will be made to the
extent of the amount of Available Funds for that Distribution Date in the
Collection Account plus amounts transferred from the Reserve Account pursuant to
Section 2.9. The amount of Available Funds in the Collection Account for each
Distribution Date will be distributed pursuant to the priority
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of distributions set forth under Section. 2.8 below. The Indenture Trustee shall
comply with such instructions received by the Administrator.
The Administrator shall instruct the Indenture Trustee in writing no
later than one Business Day preceding each Distribution Date to make the
payments pursuant to paragraph (a)(2) of the definition of Available Funds.
Section 2.8 Priority of Distributions. On each Distribution Date,
the Indenture Trustee shall first reimburse itself for all amounts due under
Section 6.7 of the Indenture and then shall make the following deposits and
distributions in the amounts and in the order of priority set forth below:
(h) to the Servicer, the Primary Servicing Fee due on
that Distribution Date; (i) to the Administrator, the Administration
Fee due on that Distribution Date and all prior unpaid Administration
Fees;
(j) to the Class A Noteholders, the Class A
Noteholders' Interest Distribution Amount, pro rata, based on the
amounts payable as Class A Noteholders' Interest Distribution Amount;
(k) to the Class B Noteholders, the Class B
Noteholders' Interest Distribution Amount, pro rata, based on the
amounts payable as Class B Noteholders' Interest Distribution Amount;
(l) to Class A-1 Noteholders, until paid in full, the
Class A Noteholders' Principal Distribution Amount; (m) to Class A-2
Noteholders, until paid in full, any remaining Class A Noteholders'
Principal Distribution Amount;
(n) to Class A-3 Noteholders, until paid in full, any
remaining Class A Noteholders' Principal Distribution Amount;
(o) to Class A-4 Noteholders, until paid in full, any
remaining Class A Noteholders' Principal Distribution Amount;
(p) to Class B Noteholders, until paid in full, the
Class B Noteholders' Principal Distribution Amount; (q) to the Reserve
Account, the amount, if any, necessary to reinstate the balance of the
Reserve Account to the Specified Reserve Account Balance;
(r) to the Servicer, the aggregate unpaid amount of
the Carryover Servicing Fee, if any; and
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(s) to the Excess Distribution Certificateholder, any
remaining amounts after application of the preceding clauses; provided,
that any amount owing to the Interest Rate Cap Counterparty as a
termination payment shall be paid from such remaining amounts prior to
the payment to the Excess Distribution Certificateholder.
Notwithstanding the foregoing:
(x) If (i) on any Distribution Date following distributions
under clauses 2.8(a) through (h) above to be made on such Distribution Date, the
Outstanding Amount of the Class A Notes would be in EXCESS OF (A) the sum of (1)
the outstanding principal balance of the Trust Student Loans, (2) any accrued
but unpaid interest on the Trust Student Loans as of the last day of the related
Collection Period and (3) the balance of the Reserve Account on such
Distribution Date following those distributions required to be made under
clauses 2.8(a) through (h) above, MINUS (B) the Specified Reserve Account
Balance for that Distribution Date, or (ii) an Event of Default affecting the
Class A Notes has occurred and is continuing, then, until the conditions
described in (i) or (ii) no longer exist, amounts on deposit in the Collection
Account and the Reserve Account shall be applied on such Distribution Date to
the payment of the Class A Noteholders' Distribution Amount before any amounts
are applied to the payment of the Class B Noteholders' Distribution Amount; and
(y) In the event the Trust Student Loans are not sold pursuant
to Section 6.1(A) or Section 4.4 of the Indenture, the amount that would
otherwise be paid to the Excess Distribution Certificateholder shall be applied
on such Distribution Date to pay as an accelerated payment of principal on the
Notes, first to the Class A Noteholders in the same order and priority as is set
forth in clauses 2.8(e) through (h) until the Outstanding Amount of the Class A
Notes is paid in full and reduced to zero, and then to the Class B Noteholders
as set forth in clause 2.8(i) above; provided that the amount of such
distribution shall not exceed the Outstanding Amount of the Class A Notes or the
Class B Notes, as applicable, after giving effect to all other payments in
respect of principal of Class A Notes and Class B Notes to be made on such
Distribution Date.
Section 2.9 Reserve Account. On the Closing Date, the Issuer shall
deposit the Reserve Account Initial Deposit into the Reserve Account.
(t) In the event that the Primary Servicing Fee for any
Monthly Servicing Payment Date or Distribution Date exceeds the amount
distributed to the Servicer pursuant to Section 2.7(b) above and Section 2.8(a)
above on such Monthly Servicing Payment Date or Distribution Date, the
Administrator shall instruct the Indenture Trustee in writing to withdraw from
the Reserve Account on such Monthly Servicing Payment Date or Distribution Date
an amount equal to such excess, to the extent of funds available therein, and to
distribute such amount to the Servicer; provided, however, that, except as
provided in Section 2.9(f) below, amounts on deposit in the Reserve Account will
not be available to cover any unpaid Carryover Servicing Fees to the Servicer.
(u) In the event that the Available Funds are insufficient to
make the payments described under Sections 2.8(a) through 2.8(d) above on any
Distribution Date, the Administrator shall instruct the Indenture Trustee in
writing to withdraw from the Reserve
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Account on each Distribution Date an amount equal to such deficiency, to the
extent of funds available therein after giving effect to clause (a) above, and
to distribute such amounts in the same order and priority as is set forth in
Sections 2.8(a) through 2.8(d) above.
(v) In the event that the Class A Noteholders' Principal
Distribution Amount on the Note Final Maturity Date with respect to any class of
Class A Notes exceeds the amount distributed to such Class A Noteholders
pursuant to Sections 2.8(e), 2.8(f), 2.8(g) or 2.8(h) above on such date, the
Administrator shall instruct the Indenture Trustee in writing to withdraw from
the Reserve Account on such Note Final Maturity Date an amount equal to such
deficiency, to the extent of funds available therein after giving effect to
clauses (a) and (b) above, and to distribute such amount to the Class A
Noteholders entitled thereto, in the same order and priority as is set forth in
Sections 2.8(e) through 2.8(h) above.
(w) In the event that the Class B Noteholders' Principal
Distribution Amount on the Class B Maturity Date exceeds the amount distributed
to the Class B Noteholders pursuant to Section 2.8(i) on such date, the
Administrator shall instruct the Indenture Trustee in writing to withdraw from
the Reserve Account on the Class B Maturity Date an amount equal to such excess,
to the extent of funds available therein after giving effect to clauses (a)
through (c) above, and to distribute such amount to the Class B Noteholders
entitled thereto.
(x) After giving effect to clauses (a) through (d) above, if
the amount on deposit in the Reserve Account on any Distribution Date (after
giving effect to all deposits or withdrawals therefrom on such Distribution Date
other than pursuant to this Section 2.9(e) is greater than the Specified Reserve
Account Balance for such Distribution Date, the Administrator shall instruct the
Indenture Trustee in writing to withdraw the amount on deposit in excess of the
Specified Reserve Account Balance and deposit such amount into the Collection
Account.
(y) On the final Distribution Date upon termination of the
Trust and following the payment in full of the Outstanding Amount of the Notes
and of all other amounts (other than Carryover Servicing Fees) owing or to be
distributed hereunder or under the Indenture to Noteholders, the Servicer, the
Administrator or the Interest Rate Cap Counterparty, as applicable, to the
extent that Available Funds on such date are insufficient to make the following
payments, amounts remaining in the Reserve Account shall be used to pay any
Carryover Servicing Fees. Any amount remaining on deposit in the Reserve Account
after such payments have been made shall be distributed to the Excess
Distribution Certificateholder. The Excess Distribution Certificateholder shall
in no event be required to refund any amounts properly distributed pursuant to
this Section 2.9(f).
Anything in this Section 2.9 to the contrary notwithstanding, if the market
value of securities and cash in the Reserve Account is on any Distribution Date
sufficient to pay the remaining principal amount of and interest accrued on the
Notes, and to pay any unpaid Carryover Servicing Fee, such amount will be so
applied on such Distribution Date and the Administrator shall instruct the
Eligible Lender Trustee and the Indenture Trustee to make such payments.
Section 2.10 Investment Earnings; Other Trust Accounts. The
Administrator will instruct the Indenture Trustee to (1) withdraw all Investment
Earnings, if any, on deposit in each
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Trust Account on each Distribution Date; (2) deposit such amounts into the
Collection Account and (3) include such amounts as Available Funds for that
Distribution Date.
Section 2.11 Statements to Excess Distribution Certificateholder and
Noteholders. On each Determination Date preceding a Distribution Date, the
Administrator shall provide to the Indenture Trustee and the Eligible Lender
Trustee (with a copy to the Rating Agencies) for the Indenture Trustee to
forward on such succeeding Distribution Date to each Noteholder of record and
for the Eligible Lender Trustee to forward on such succeeding Distribution Date
to the Excess Distribution Certificateholder of record a statement, setting
forth at least the following information as to the Notes and the Excess
Distribution Certificate to the extent applicable:
(z) the amount of such distribution allocable to
principal of each class of the Notes;
(aa) the amount of the distribution allocable to
interest on each class of the Notes;
(bb) the amount of the distribution allocable to the
Excess Distribution Certificate, if any;
(cc) [Reserved];
(dd) the Pool Balance as of the close of business on
the last day of the preceding Collection Period;
(ee) the aggregate outstanding principal balance of
the Notes and the Note Pool Factor as of such Distribution Date, after
giving effect to payments allocated to principal reported under clauses
(a) and (c) above;
(ff) the Note Rate for the next period for any class
of Notes;
(gg) the amount of the Servicing Fee and any
Carryover Servicing Fee paid to the Servicer on such Distribution Date
and on the two preceding Monthly Servicing Payment Dates, and the
amount, if any, of the Carryover Servicing Fee remaining unpaid after
giving effect to any such payments;
(hh) the amount of the Administration Fee paid to the
Administrator on such Distribution Date;
(ii) [Reserved];
(jj) the amount of the aggregate Realized Losses, if
any, for the related Collection Period and the balance of Trust Student
Loans that are delinquent in each delinquency period as of the end of
such Collection Period;
(kk) the amount of any Note Interest Shortfall, if
any, in each case as applicable to each class of Notes, and the change
in such amounts from the preceding statement;
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(ll) the aggregate Purchase Amounts for Trust Student
Loans, if any, that were repurchased by the Depositor or purchased by
the Servicer or SLMA from the Issuer during such Collection Period;
(mm) the balance of the Reserve Account on such
Distribution Date, after giving effect to changes therein on such
Distribution Date; and
(nn) the balance of Trust Student Loans that are
delinquent in each delinquency period as of the end of that Collection
Period.
Each amount set forth pursuant to clauses (a), (b), (c), (f), (h), (i)
and (l) above shall be expressed as a dollar amount per $1,000 of original
principal balance of the applicable Note. A copy of the statements referred to
above may be obtained by any Excess Distribution Certificateholder or Note Owner
by a written request to the Eligible Lender Trustee or the Indenture Trustee,
respectively, addressed to the respective Corporate Trust Office.
Section 2.12 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 not
have withheld consent or provided an alternative direction. For the purpose of
the preceding sentence, "non-ministerial matters" shall include:
(oo) the amendment of or any supplement to the
Indenture;
(pp) 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
Trust Student Loans);
(qq) the amendment, change or modification of the
Basic Documents;
(rr) 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; and
(ss) the removal of the Indenture Trustee.
Section 2.13 Exceptions. Notwithstanding anything to the contrary in
this Agreement, except as expressly provided herein or in the other Basic
Documents, the Administrator shall not be obligated to, and shall not, (a) make
any payments to the Noteholders under the Basic Documents, (b) sell the
Indenture Trust Estate pursuant to Section 5.04 of the Indenture, (c) take any
other action that the Issuer directs the Administrator not to take on its
behalf, (d) in connection with its duties hereunder assume any indemnification
obligation of any other Person or (e) service the Trust Student Loans.
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Section 2.14 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 $20,000 for
each Collection Period payable on the related Distribution Date (the
"Administration Fees") payable in arrears which shall be solely an obligation of
the Issuer.
Section 2.15 Servicer and Administrator Expenses. Each of the Servicer
and the Administrator shall be severally required to pay all expenses incurred
by it in connection with its activities hereunder, including fees and
disbursements of independent accountants, taxes imposed on the Servicer or the
Administrator, as the case may be, and expenses incurred in connection with
distributions and reports to the Administrator or to the Certificateholders and
the Noteholders, as the case may be.
ARTICLE III
Section 3.1 Administrator's Certificate; Servicer's Report.
(a) On or before the tenth day of each month (or, if any such
day is not a Business Day, on the next succeeding Business Day), the Servicer
shall deliver to the Administrator a Servicer's Report with respect to the
preceding month containing all information necessary for the Administrator to
receive in connection with the preparation of the Administrator's Officers'
Certificate covering such calendar month referred to in Section 3.1(b) below. On
or before the tenth day (or, if any such day is not a Business Day, on the next
succeeding Business Day), preceding each Distribution Date the Servicer shall
deliver to the Administrator a Servicer's Report with respect to the preceding
Collection Period containing all information necessary for the Administrator to
receive in connection with the preparation of the Administrator's Certificate
covering such Collection Period referred to in Section 3.1(c) below.
(b) On the second Business Day prior to each Monthly Servicing
Payment Date that is not a Distribution Date, the Administrator shall deliver to
the Eligible Lender Trustee and the Indenture Trustee, an Officers' Certificate
of the Administrator containing all information necessary to pay the Servicer
the Primary Servicing Fee due on such Monthly Servicing Payment Date pursuant to
Section 2.7(b) above.
(c) On each Determination Date prior to a Distribution Date,
the Administrator shall deliver to the Eligible Lender Trustee and the Indenture
Trustee, with a copy to the Rating Agencies, an Administrator's Certificate
containing all information necessary to make the distributions pursuant to
Sections 2.7 and 2.8 above, if applicable, for the Collection Period preceding
the date of such Administrator's Certificate.
(d) Prior to each Determination Date, the Administrator shall
determine the Note Rates and that will be applicable to the Distribution Date
following such Determination Date, in compliance with its obligation to prepare
and deliver an Administrator's Certificate on such Determination Date pursuant
to this Section 3.1. In connection therewith, the Administrator shall calculate
Two-Month LIBOR or Three-Month LIBOR, as applicable, for the first Accrual
Period and for each subsequent Accrual Period shall calculate, on each LIBOR
Determination Date during such Accrual Period, Three-Month LIBOR.
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(e) The Administrator hereby accepts the delegation to it of
the obligations of the "Calculation Agent" under the Interest Rate Cap Agreement
to which the Issuer is a party, as applicable.
(f) The Administrator shall furnish to the Issuer from time to
time such information regarding the Collateral as the Issuer shall reasonably
request.
Section 3.2 Annual Statement as to Compliance; Notice of Default;
Financial Statements.
(a) Each of the Servicer and the Administrator shall
deliver to the Eligible Lender Trustee and the Indenture Trustee on or
before 90 days after the end of the fiscal year of the Servicer and the
Administrator, an Officer's Certificate of the Servicer or the
Administrator, as the case may be, dated as of December 31 of the
preceding year, stating that (i) a review of the activities of the
Servicer or the Administrator, as the case may be, 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, 2004) 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 Servicer or the Administrator, as the case may be, has
fulfilled its obligations in all material respects under this Agreement
and, with respect to the Servicer, the Servicing Agreement throughout
such year or, if there has been a material default in the fulfillment
of any such obligation, specifying each such material default known to
such officers and the nature and status thereof. The Indenture Trustee
shall send a copy of each such Officers' Certificate and each report
referred to in Section 3.1 to the Rating Agencies. A copy of each such
Officers' Certificate and each report referred to in Section 3.1 may be
obtained by any Excess Distribution Certificateholder, Noteholder or
Note Owner by a request in writing to the Eligible Lender Trustee
addressed to its Corporate Trust Office, together with evidence
satisfactory to the Eligible Lender Trustee that such Person is one of
the foregoing parties. Upon the telephone request of the Eligible
Lender Trustee, the Indenture Trustee will promptly furnish the
Eligible Lender Trustee a list of Noteholders as of the date specified
by the Eligible Lender Trustee.
(b) The Servicer shall deliver to the Eligible Lender
Trustee, the Indenture Trustee and the Rating Agencies, promptly after
having obtained knowledge thereof, but in no event later than five
Business Days thereafter, written notice in an Officers' Certificate of
the Servicer of any event which with the giving of notice or lapse of
time, or both, would become a Servicer Default under Section 5.01 of
the Servicing Agreement.
(c) The Administrator shall deliver to the Eligible
Lender Trustee, the Indenture Trustee and the Rating Agencies, promptly
after having obtained knowledge thereof, but in no event later than
five 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 Sections 5.1(a) or (b) below or would cause the Administrator to
fail to meet the requirement of clause (a) of Section 2.4 above.
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(d) At any time that the Administrator is not an
Affiliate of the Depositor, the Administrator shall provide to the
Eligible Lender Trustee, the Indenture Trustee and the Rating Agencies
(i) as soon as possible and in no event more than 120 days after the
end of each fiscal year of the Administrator, audited financials as at
the end of and for such year and (ii) as soon as possible and in no
event more than 30 days after the end of each quarterly accounting
period of the Administrator unaudited financials as at the end of and
for such period.
Section 3.3 Annual Independent Certified Public Accountants' Report.
Each of the Servicer and the Administrator shall cause a firm of independent
certified public accountants, which may also render other services to the
Servicer or the Administrator, as the case may be, to deliver to the Eligible
Lender Trustee, the Indenture Trustee and the Rating Agencies on or before March
31 of each year, a report addressed to the Servicer or the Administrator, as the
case may be, the Eligible Lender Trustee and the Indenture Trustee, to the
effect that such firm has examined certain documents and records relating to the
servicing of the Trust Student Loans, or the administration of the Trust Student
Loans and of the Trust, as the case may be, during the preceding calendar year
(or, in the case of the first such report, during the period from the Closing
Date to December 31, 2004) and that, on the basis of the accounting and auditing
procedures considered appropriate under the circumstances, such firm is of the
opinion that such servicing or administration, respectively, was conducted in
compliance with those terms of this Agreement and in the case of the Servicer,
the Servicing Agreement, including any applicable statutory provisions
incorporated therein and such additional terms and statutes as may be specified
from time to time by the Administrator, except for (a) such exceptions as such
firm shall believe to be immaterial and (b) such other exceptions as shall be
set forth in such report. Such report will also indicate that the firm is
independent of the Servicer or the Administrator, as the case may be, within the
meaning of the Code of Professional Ethics of the American Institute of
Certified Public Accountants.
ARTICLE IV
Section 4.1 Representations of Administrator. Xxxxxx Xxx, Inc., as
Administrator, makes the following representations on which the Issuer is deemed
to have relied in acquiring the Trust Student Loans. 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 Trust 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 duly
organized and validly existing under the laws of the State of Delaware, with the
power and authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently conducted.
(b) Power and Authority. The Administrator has the corporate
power and authority to execute and deliver this Agreement and to carry out its
terms, and the execution, delivery and performance of this Agreement have been
duly authorized by the Administrator by all necessary corporate action.
17
(c) Binding Obligation. This Agreement has been duly
authorized, executed and delivered by the Administrator and, assuming that it is
duly executed and delivered by parties hereto, constitutes a valid and binding
agreement of the Administrator, enforceable against the Administrator in
accordance with its terms; except that the enforceability hereof may be subject
to (a) bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally, and (b)
general principles of equity (regardless of whether such enforceability is
considered in a proceeding at law or in equity) and (c) with respect to rights
to indemnity hereunder, limitations of public policy under applicable securities
laws.
(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 articles of incorporation or by-laws of the Administrator,
or any indenture, agreement or other instrument to which the Administrator is a
party or by which it shall be bound; nor result in the creation or imposition of
any Lien upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than pursuant to the Basic Documents); nor
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 legal or governmental
proceedings or investigations pending against the Administrator or, to its best
knowledge, threatened or contemplated against the Administrator or to which the
Administrator or any of its subsidiaries is party or of which any property of
the Administrator or any of its subsidiaries is the subject, before any court,
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Administrator or its properties or by any other
party: (i) asserting the invalidity of this Agreement or any of the other Basic
Documents, the Notes or the Excess Distribution Certificate, (ii) seeking to
prevent the issuance of the Notes or the Excess Distribution Certificate or the
consummation of any of the transactions contemplated by this Agreement 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, any of the other Basic Documents, the Trust, the Notes or
the Excess Distribution Certificate or (iv) seeking to affect adversely the
Federal or state income tax attributes of the Issuer, the Notes or the Excess
Distribution Certificate.
(f) All Consents. All authorizations, consents, 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 the transactions contemplated by this
Agreement have been duly obtained, effected or given and are in full force and
effect.
Section 4.2 Liability of Administrator; Indemnities.
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(a) The Administrator shall be liable in accordance herewith
only to the extent of the obligations specifically undertaken by the
Administrator under this Agreement.
(b) The Administrator shall indemnify, defend and hold
harmless the Issuer, the Excess Distribution Certificateholder and the
Noteholders and any of the officers, directors, employees and agents of the
Issuer from and against any and all costs, expenses, losses, claims, damages and
liabilities to the extent that such cost, expense, loss, claim, damage or
liability arose out of, or was imposed upon any such Person through, the gross
negligence, willful misfeasance or bad faith of the Administrator in the
performance of its duties under this Agreement or by reason of reckless
disregard of its obligations and duties hereunder or thereunder.
(c) The Administrator shall indemnify the Indenture Trustee in
its individual capacity and any of its officers, directors, employees and agents
against any and all loss, liability or expense (including attorneys' fees)
incurred by it in connection with the performance of its duties under the
Indenture and the other Basic Documents. The Indenture Trustee shall notify the
Issuer and the Administrator promptly of any claim for which it, may seek
indemnity. Failure by the Indenture Trustee to so notify the Issuer and the
Administrator shall not relieve the Issuer or the Administrator of its
obligations hereunder and under the other Basic Documents. The Administrator
shall defend the claim and the Administrator shall not be liable for the legal
fees and expenses of the Indenture Trustee after it has assumed such defense;
provided, however, that, in the event that there may be a conflict between the
positions of the Indenture Trustee and the Administrator in conducting the
defense of such claim, the Indenture Trustee shall be entitled to separate
counsel the fees and expenses of which shall be paid by the Administrator on
behalf of the Issuer. Neither the Issuer nor the Administrator need to reimburse
any expense or indemnify against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee's own willful misconduct,
negligence or bad faith.
(d) The Administrator shall indemnify the Eligible Lender
Trustee (including in its capacity as Interim Eligible Lender Trustee) in its
individual capacity and any of its officers, directors, employees and agents
against any and all loss, liability, claims, damages, costs, penalties, taxes
(excluding taxes payable by it on any compensation received by it for its
services as trustee) or expense (including attorneys' fees) incurred by it in
connection with the performance of its duties under the Interim Trust Agreement,
the Trust Agreement and the other Basic Documents.
(e) Without limiting the generality of the foregoing, the
Administrator shall indemnify the Eligible Lender Trustee in its individual
capacity and any of its officers, directors, employees and agents against any
and all liability relating to or resulting from any of the following:
(i) any claim that the Trust Student Loans (or any
guarantee with respect thereto) are delinquent, uncollectable, uninsured,
illegal, invalid or unenforceable;
(ii) any claim that the Trust Student Loans have not
been made, administered, serviced or collected in accordance with applicable
federal and state laws or the requirements of any Guarantor;
19
(iii) any claim that any original note or other
document evidencing or relating to the Trust Student Loans has been lost,
misplaced or destroyed; and
(iv) any claim for failure to comply with the
provisions of 34 CFR Sec. 682.203(b) (other than for the Eligible Lender
Trustee's failure to qualify as an eligible lender under the Act).
(f) The Eligible Lender Trustee shall notify the Administrator
promptly of any claim for which it may seek indemnity. Failure by the Eligible
Lender Trustee to so notify the Administrator shall not relieve the
Administrator of its obligations hereunder and under the other Basic Documents.
The Administrator shall defend the claim and the Administrator shall not be
liable for the legal fees and expenses of the Eligible Lender Trustee after it
has assumed such defense; provided, however, that, in the event that there may
be a conflict between the positions of the Eligible Lender Trustee and the
Administrator in conducting the defense of such claim, the Eligible Lender
Trustee shall be entitled to separate counsel the fees and expenses of which
shall be paid by the Administrator on behalf of the Issuer. Neither the Issuer
nor the Administrator need reimburse any expense or indemnify against any loss,
liability or expense incurred by the Eligible Lender Trustee through the
Eligible Lender Trustee's own willful misconduct, negligence or bad faith.
(g) The Depositor shall pay reasonable compensation to the
Indenture Trustee and the Eligible Lender Trustee and shall reimburse the
Indenture Trustee and the Eligible Lender Trustee for all reasonable expenses,
disbursements and advances.
(h) For purposes of this Section 4.2, in the event of the
termination of the rights and obligations of the Administrator (or any successor
thereto pursuant to Section 4.3 below) as Administrator pursuant to Section 5.1
below, 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 5.2 below.
(i) Indemnification under this Section 4.2 shall survive the
resignation or removal of the Eligible Lender Trustee or the Indenture Trustee
or the termination of this Agreement and shall include reasonable fees and
expenses of counsel and expenses of litigation. If the Administrator shall have
made any indemnity payments pursuant to this Section and the Person to or on
behalf of whom such payments are made thereafter collects any of such amounts
from others, such Person shall promptly repay such amounts to the Administrator,
without interest.
Section 4.3 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 Xxxxxx Xxx, Inc., executes an agreement
that states expressly that such Person assumes to perform every
20
obligation of the Administrator under this Agreement, (ii) immediately after
giving effect to such transaction, no representation or warranty made pursuant
to Section 4.1 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, (iii) the surviving
Administrator, if other than Xxxxxx Mae, Inc., shall have delivered to the
Eligible Lender Trustee and the Indenture Trustee an Officers' Certificate and
an Opinion of Counsel each stating that such consolidation, merger or succession
and such agreement of assumption comply with this Section 4.3 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, (iv) unless Xxxxxx Xxx,
Inc. is the surviving entity, such transaction will not result in a material
adverse Federal or state tax consequence to the Issuer, the Noteholders or the
Certificateholders and (v) unless Xxxxxx Mae, Inc. is the surviving entity, the
Administrator shall have delivered to the Eligible Lender Trustee and the
Indenture Trustee an Opinion of Counsel either (A) stating that, in the opinion
of such counsel, all financing statements and continuation statements and
amendments thereto have been executed and filed that are necessary fully to
preserve and protect the interest of the Eligible Lender Trustee and Indenture
Trustee, respectively, in the Trust Student Loans and reciting the details of
such filings, or (B) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interests. Anything in
this Section 4.3 to the contrary notwithstanding, the Administrator may at any
time assign its rights, obligations and duties under this Agreement to an
Affiliate provided that the Rating Agencies confirm that such assignment will
not result in a downgrading or a withdrawal of the ratings then applicable to
the Notes.
Section 4.4 Limitation on Liability of Seller, Administrator and
Others.
(a) Neither the Administrator nor any of its directors,
officers, employees or agents shall be under any liability to the Issuer, the
Noteholders or the Certificateholders, or to the Indenture Trustee or the
Eligible Lender Trustee 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 these provisions 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 duties or by reason of reckless disregard of obligations
and 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.
(b) 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 Trust
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 other Basic Documents
and the interests of the Certificateholders under this Agreement and the
Noteholders under the Indenture and under this Agreement.
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Section 4.5 Administrator May Own Certificates or Notes. The
Administrator and any Affiliate thereof may in its individual or any other
capacity become the owner or pledgee of the Excess Distribution Certificate or
Notes with the same rights as it would have if it were not the Administrator or
an Affiliate thereof, except as expressly provided herein in any other Basic
Document.
Section 4.6 Xxxxxx Xxx, Inc. Not to Resign as Administrator. Subject to
the provisions of Section 4.3 above, Xxxxxx Mae, Inc. 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
Xxxxxx Xxx, Inc. or its properties. Notice of any such determination permitting
or requiring the resignation of Xxxxxx Mae, Inc. 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 Xxxxxx Xxx, Inc. in accordance with Section 5.2 below. Anything
in this Section 4.6 to the contrary notwithstanding, the Administrator may
resign at any time subsequent to the assignment of its rights, duties and
obligations hereunder pursuant to Section 4.3 above.
ARTICLE V
Section 5.1 Administrator Default. If any one of the following events
(an "Administrator Default") shall occur and be continuing:
(a) (i) in the event that daily deposits into the Collection
Account are not required, any failure by the Administrator to deliver to the
Indenture Trustee for deposit in the Trust Accounts any Available Funds required
to be paid on or before the Business Day immediately preceding any Monthly
Servicing Payment Date or Distribution Date, as applicable, or
(ii) any failure by the Administrator to direct the
Indenture Trustee to make any required distributions from either of the Trust
Accounts on any Monthly Servicing Payment Date or Distribution Date, which
failure in case of either clause (i) or (ii) continues unremedied for five
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 an officer of the Administrator; or
(b) any failure by the Administrator duly to observe or to
perform in any material respect any other term, covenant or agreement of the
Administrator set forth in this Agreement or any other Basic Document, which
failure shall (i) materially and adversely affect the rights of Noteholders or
Certificateholders and (ii) continue unremedied for a period of 60 days after
the date 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
22
Trustee or (B) to the Administrator, the Indenture Trustee and the Eligible
Lender Trustee by the Noteholders or Certificateholders, as applicable,
representing not less than 50% of the Outstanding Amount of the Notes or 50% of
the outstanding Certificates (including any Certificates owned by the
Depositor); or
(c) an Insolvency Event occurs with respect to the
Administrator;
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 50% 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 4.2 above) 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, the Excess Distribution
Certificate, the Trust 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 5.2 below; 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) incurred in connection with amending this Agreement to reflect
such succession as Administrator pursuant to this Section shall be paid by the
predecessor Administrator (other than the Indenture Trustee acting as the
Administrator under this Section 5.1) 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 5.2 Appointment of Successor.
(a) Upon receipt by the Administrator of notice of termination
pursuant to Section 5.1 above, 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 under this Agreement 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 receipt of
such notice and, in the case of resignation, until the later of (i) 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 (ii) the date upon which the
predecessor Administrator shall become unable to act as Administrator as
specified in the notice of resignation and accompanying Opinion of Counsel (the
"Transfer Date"). In the event of the 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 form acceptable to the Indenture Trustee. In the event
that a successor Administrator has not been appointed at
23
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 shall, if it shall be unwilling or legally unable so to
act, appoint or petition a court of competent jurisdiction to appoint any
established institution whose regular business shall include the servicing of
student loans, as the successor to the Administrator under this Agreement.
(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 such compensation arrangements will not result in a
downgrading or withdrawal of any rating on the Notes or the Certificates by any
Rating Agency) and all the rights granted to the predecessor Administrator by
the terms and provisions of this Agreement.
(c) Notwithstanding the foregoing or anything to the contrary
herein or in the other Basic Documents, the Indenture Trustee, to the extent it
is acting as successor Administrator pursuant hereto and thereto, shall be
entitled to resign to the extent a qualified successor Administrator has been
appointed and has assumed all the obligations of the Administrator in accordance
with the terms of this Agreement and the other Basic Documents.
Section 5.3 Notification to Noteholders and Certificateholders. Upon
any termination of, or appointment of a successor to, the Administrator pursuant
to this Article V, the Eligible Lender Trustee shall give prompt written notice
thereof to Certificateholders and the Indenture Trustee shall give prompt
written notice thereof to Noteholders 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 5.4 Waiver of Past Defaults. The Noteholders of Notes
evidencing a majority of the Outstanding Amount of the Notes (or the
Certificateholders of Certificates evidencing a majority of the outstanding
Certificates, in the case of any default which does not adversely affect the
Indenture Trustee or the Noteholders) may, on behalf of all Noteholders and
Certificateholders, 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. No such waiver shall extend
to any subsequent or other default or impair any right consequent thereto.
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ARTICLE VI
Section 6.1 Termination.
(a) Optional Purchase of All Trust Student Loans. The
Administrator shall notify the Servicer, the Depositor, the Issuer and the
Indenture Trustee in writing, within 15 days after the last day of any
Collection Period as of which the then outstanding Pool Balance is 12% or less
of the Initial Pool Balance, of the percentage that the then outstanding Pool
Balance bears to the Initial Pool Balance. As of the last day of any Collection
Period immediately preceding a Distribution Date as of which the then
outstanding Pool Balance is 10% or less of the Initial Pool Balance, the
Eligible Lender Trustee on behalf and at the direction of the Servicer, or any
other "eligible lender" (within the meaning of the Higher Education Act)
designated by the Servicer in writing to the Eligible Lender Trustee and the
Indenture Trustee, shall have the option to purchase the Trust Estate, other
than the Trust Accounts. To exercise such option, the Servicer shall deposit,
pursuant to Section 2.6 above, in the Collection Account an amount equal to the
aggregate Purchase Amount for the Trust Student Loans and the related rights
with respect thereto, plus the appraised value of any such other property held
by the Trust other than the Trust Accounts, such value to be determined by an
appraiser mutually agreed upon by the Servicer, the Eligible Lender Trustee and
the Indenture Trustee, and shall succeed to all interests in and to the Trust;
provided, however, that the Servicer may not effect such purchase if such
aggregate Purchase Amounts do not equal or exceed the Minimum Purchase Amount
plus any Carryover Servicing Fees. In the event the Servicer fails to notify the
Eligible Lender Trustee and the Indenture Trustee in writing prior to the
acceptance by the Indenture Trustee of a bid to purchase the Trust Estate
pursuant to Section 4.4 of the Indenture that the Servicer intends to exercise
its option to purchase the Trust Estate, the Servicer shall be deemed to have
waived its option to purchase the Trust Estate as long as the Servicer has
received 5 business days' notice from the Indenture Trustee as provided in
Section 4.4 of the Indenture.
(b) Notice. 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.
(c) Succession. Following the satisfaction and discharge of
the Indenture and the payment in full of the principal of and interest on the
Notes, the holder of the Excess Distribution Certificate shall succeed to the
rights of the Noteholders hereunder and the Eligible Lender Trustee shall
succeed to the rights of, and assume the obligations of, the Indenture Trustee
pursuant to this Agreement and any other Basic Documents.
ARTICLE VII
Section 7.1 Protection of Interests in Trust.
(a) The Administrator, on behalf of the Depositor, shall
execute and file such financing statements and cause to be executed and filed
such continuation statements, all in such manner and in such places as may be
required by law fully to preserve, maintain, and protect the interest of the
Issuer, the Eligible Lender Trustee and the Indenture Trustee in the Trust
Student Loans and in the proceeds thereof. The Administrator shall deliver (or
cause to be
25
delivered) to the Eligible Lender Trustee and the Indenture Trustee file-stamped
copies of, or filing receipts for, any document filed as provided above, as soon
as available following such filing.
(b) Neither the Depositor nor the Servicer shall change its
name, identity or corporate structure in any manner that would, could or might
make any financing statement or continuation statement filed in accordance with
paragraph (a) above seriously misleading within the meaning of Section 9-402(7)
of the UCC, unless it shall have given the Eligible Lender Trustee and the
Indenture Trustee at least five days' prior written notice thereof and shall
have promptly filed appropriate amendments to all previously filed financing
statements or continuation statements.
(c) Each of the Depositor and the Servicer shall have an
obligation to give the Eligible Lender Trustee and the Indenture Trustee at
least 60 days' prior written notice of any relocation of its principal executive
office if, as a result of such relocation, the applicable provisions of the UCC
would require the filing of any amendment of any previously filed financing or
continuation statement or of any new financing statement and shall promptly file
any such amendment. The Servicer shall at all times maintain each office from
which it shall service Trust Student Loans, and its principal executive office,
within the United States of America.
(d) The Servicer shall maintain accounts and records as to
each Trust Student Loan accurately and in sufficient detail to permit (i) the
reader thereof to know at any time the status of such Trust Student Loan,
including payments and recoveries made and payments owing (and the nature of
each) and (ii) reconciliation between payments or recoveries on (or with respect
to) each Trust Student Loan and the amounts from time to time deposited by the
Servicer in the Collection Account in respect of such Trust Student Loan.
(e) The Servicer shall maintain its computer systems so that,
from and after the time of sale of the Trust Student Loans to the Eligible
Lender Trustee on behalf of the Issuer, the Servicer's master computer records
(including any backup archives) that refer to a Trust Student Loan shall
indicate clearly the interest of the Issuer, the Eligible Lender Trustee and the
Indenture Trustee in such Trust Student Loan and that such Trust Student Loan is
owned by the Eligible Lender Trustee on behalf of the Issuer and has been
pledged to the Indenture Trustee. Indication of the Issuer's, the Eligible
Lender Trustee's and the Indenture Trustee's interest in a Trust Student Loan
shall be deleted from or modified on the Servicer's computer systems when, and
only when, the related Trust Student Loan shall have been paid in full or
repurchased.
(f) If at any time the Depositor or the Administrator shall
propose to sell, grant a security interest in, or otherwise transfer any
interest in student loans to any prospective purchaser, lender or other
transferee, the Servicer shall give to such prospective purchaser, lender or
other transferee computer tapes, records or printouts (including any restored
from backup archives) that, if they refer in any manner whatsoever to any Trust
Student Loan, indicate clearly that such Trust Student Loan has been sold and is
owned by the Eligible Lender Trustee on behalf of the Issuer and has been
pledged to the Indenture Trustee.
26
(g) Upon reasonable notice, the Servicer shall permit the
Indenture Trustee and its agents at any time during normal business hours to
inspect, audit and make copies of and abstracts from the Servicer's records
regarding any Trust Student Loan.
(h) Upon request, at any time the Eligible Lender Trustee or
the Indenture Trustee have reasonable grounds to believe that such request would
be necessary in connection with its performance of its duties under the Basic
Documents, the Servicer shall furnish to the Eligible Lender Trustee or to the
Indenture Trustee (in each case, with a copy to the Administrator), within five
Business Days, a list of all Trust Student Loans (by borrower social security
number, type of loan and date of issuance) then held as part of the Trust, and
the Administrator shall furnish to the Eligible Lender Trustee or to the
Indenture Trustee, within 20 Business Days thereafter, a comparison of such list
to the list of Trust Student Loans set forth in Schedule A to the Indenture as
of the Closing Date, and, for each Trust Student Loan that has been removed from
the pool of loans held by the Eligible Lender Trustee on behalf of the Issuer,
information as to the date as of which and circumstances under which each such
Trust Student Loan was so removed.
(i) The Depositor shall deliver to the Eligible Lender Trustee
and the Indenture Trustee:
(i) promptly after the execution and delivery of this
Agreement and of each amendment thereto and on each Transfer Date, an Opinion of
Counsel either (1) stating that, in the opinion of such counsel, all financing
statements and continuation statements have been executed and filed that are
necessary fully to preserve and protect the interest of the Eligible Lender
Trustee and the Indenture Trustee in the Trust Student Loans, and reciting the
details of such filings or referring to prior Opinions of Counsel in which such
details are given, or (2) stating that, in the opinion of such counsel, no such
action shall be necessary to preserve and protect such interest; and
(ii) within 120 days after the beginning of each
calendar year beginning with the first calendar year beginning more than three
months after the Cutoff Date, an Opinion of Counsel, dated as of a date during
such 120-day period, either (1) stating that, in the opinion of such counsel,
all financing statements and continuation statements have been executed and
filed that are necessary fully to preserve and protect the interest of the
Eligible Lender Trustee and the Indenture Trustee in the Trust Student Loans,
and reciting the details of such filings or referring to prior Opinions of
Counsel in which such details are given, or (2) stating that, in the opinion of
such counsel, no such action shall be necessary to preserve and protect such
interest; provided that a single Opinion of Counsel may be delivered in
satisfaction of the foregoing requirement and that of Section 3.6(b) of the
Indenture.
(j) Each Opinion of Counsel referred to in clause (i) or (ii)
of clause (i) above shall specify (as of the date of such opinion and given all
applicable laws as in effect on such date) any action necessary to be taken in
the following year to preserve and protect such interest.
(k) The Depositor shall, to the extent required by applicable
law, cause the Excess Distribution Certificate and the Notes to be registered
with the Commission pursuant
27
to Section 12(b) or Section 12(g) of the Exchange Act within the time periods
specified in such sections.
ARTICLE VIII
Section 8.1 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 8.2 No Joint Venture. Nothing contained in this Agreement (a)
shall constitute the Administrator and either of the Issuer or the Eligible
Lender Trustee as members of any partnership, joint venture, association,
syndicate, unincorporated business or other separate entity, (b) shall be
construed to impose any liability as such on any of them or (c) 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 8.3 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 or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Eligible
Lender Trustee or the Indenture Trustee.
Section 8.4 Powers of Attorney. The Eligible Lender Trustee and the
Indenture Trustee shall upon the written request of the Administrator furnish
the Administrator with any powers of attorney and other documents reasonably
necessary or appropriate to enable the Administrator to carry out its
administrative duties hereunder.
Section 8.5 Amendment.
(a) This Agreement (other than Sections 2.1 and 2.2 above) may
be amended by the Issuer, the holder of the Excess Distribution Certificate, the
Servicer, the Administrator, the Eligible Lender Trustee and the Indenture
Trustee, without the consent of any of the Noteholders, to cure any ambiguity,
to correct or Agreement any provisions in this Agreement or for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions in this Agreement or of modifying in any manner the rights of the
Noteholders; provided, however, that such action shall not, as evidenced by an
Opinion of Counsel delivered to the Eligible Lender Trustee and the Indenture
Trustee, adversely affect in any material respect the interests of any
Noteholder or Certificateholder, and that such action will not materially
adversely affect (1) the Trust's ability to enforce or protect its rights or
remedies under the Interest Rate Cap Agreement, (2) the ability of the Trust to
timely and fully perform its obligations under the Interest Rate Cap Agreement
or (3) any of the Trust's obligations under the Interest Rate Cap Agreement or
any cap transaction under such agreement. Any such
28
amendment, modification or Agreement without the consent of the Interest Rate
Cap Counterparty shall not be binding on the Interest Rate Cap Counterparty.
(b) Sections 2.1 and 2.2 may be amended from time to time by a
written amendment duly executed and delivered by the Issuer, the holder of the
Excess Distribution Certificate, the Eligible Lender Trustee, the Indenture
Trustee and the Administrator, without the consent of the Noteholders, for the
purpose of adding any provision to or changing in any manner or eliminating any
of the provisions of such Article; provided 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.
(c ) This Agreement (other than Sections 2.1 and 2.2 above)
may also be amended from time to time by the Issuer, the holder of the Excess
Distribution Certificate, the Servicer, the Administrator, the Indenture Trustee
and the Eligible Lender Trustee, and Sections 2.1 and 2.2 above may also be
amended by the Eligible Lender Trustee, the Administrator and the Indenture
Trustee, with the consent of the Noteholders of Notes evidencing a majority of
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 the Noteholders; provided, however,
that no such amendment shall (i) increase or reduce in any manner the amount of,
or accelerate or delay the timing of, collections of payments with respect to
Trust Student Loans or distributions that shall be required to be made for the
benefit of the Noteholders or (ii) reduce the aforesaid percentage of the
Outstanding Amount of the Notes, the Noteholders of which are required to
consent to any such amendment, without the consent of all outstanding
Noteholders.
(d) Promptly after the execution of any such amendment (or, in
the case of the Rating Agencies, fifteen days prior thereto), the Eligible
Lender Trustee shall furnish written notification of the substance of such
amendment to the holder of the Excess Distribution Certificate, the Indenture
Trustee and each of the Rating Agencies.
(e) It shall not be necessary for the consent of Noteholders
pursuant to this Section to approve the particular form of any proposed
amendment or consent, but it shall be sufficient if such consent shall approve
the substance thereof.
(f) Prior to the execution of any amendment to this Agreement,
the Eligible Lender Trustee and the Indenture Trustee shall be entitled to
receive and rely upon an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement and the Opinion of
Counsel referred to in Section 7.1(i) above. The Eligible Lender Trustee and the
Indenture Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Eligible Lender Trustee's or the Indenture
Trustee's, as applicable, own rights, duties or immunities under this Agreement
or otherwise.
Section 8.6 Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 4.3 of the Servicing Agreement
and Section 4.3 of this Agreement, this Agreement may not be assigned by the
Depositor, the Administrator or the Servicer. This
29
Agreement may be assigned by the Eligible Lender Trustee only to its permitted
successor pursuant to the Trust Agreement.
Section 8.7 Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Depositor, the Servicer, the
Issuer, the Indenture Trustee and the Eligible Lender Trustee and for the
benefit of the Excess Distribution Certificateholders and the Noteholders, as
third party beneficiaries, and nothing in this Agreement, whether express or
implied, shall be construed to give to any other Person any legal or equitable
right, remedy or claim in the Trust Estate or under or in respect of this
Agreement or any covenants, conditions or provisions contained herein.
Section 8.8 Assignment to Indenture Trustee. The Depositor hereby
acknowledges and consents to any Grant by the Issuer to the Indenture Trustee
pursuant to the Indenture for the benefit of the Noteholders of a security
interest in all right, title and interest of the Issuer in, to and under the
Trust Student Loans and the assignment of any or all of the Issuer's rights and
obligations under this Agreement and the Sale Agreement and the Depositor's
rights under the Purchase Agreement to the Indenture Trustee. The Servicer
hereby acknowledges and consents to the assignment by the Issuer to the
Indenture Trustee pursuant to the Indenture for the benefit of the Noteholders
of any and all of the Issuer's rights and obligations under this Agreement and
under the Servicing Agreement.
Section 8.9 Nonpetition Covenants.
(a) Notwithstanding any prior termination of this Agreement,
the Servicer, the Administrator, the Eligible Lender Trustee, the Indenture
Trustee and the Depositor shall not, prior to the date which is 367 days after
the payment in full of the Notes, acquiesce, petition or otherwise invoke or
cause the Issuer to invoke the process of any court or government authority for
the purpose of commencing or sustaining a case against the Issuer under any
Federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Issuer or any substantial part of its property, or ordering the winding
up or liquidation of the affairs of the Issuer. The foregoing shall not limit
the rights of the Servicer, the Administrator, the Eligible Lender Trustee, the
Indenture Trustee and the Depositor to file any claim in, or otherwise take any
action with respect to, any insolvency proceeding that was instituted against
the Issuer by a Person other than the Servicer, the Administrator, the Eligible
Lender Trustee or the Depositor.
(b) Notwithstanding any prior termination of this Agreement,
the Servicer, the Administrator, the Issuer and the Eligible Lender Trustee
shall not, prior to the date which is 367 days after the payment in full of the
Notes, acquiesce, petition or otherwise invoke or cause the Depositor to invoke
the process of any court or government authority for the purpose of commencing
or sustaining a case against the Depositor under any insolvency or similar law
or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator
or other similar official of the Depositor or any substantial part of its
property, or ordering the winding up or liquidation of the affairs of the
Depositor. The foregoing shall not limit the rights of the Servicer, the
Administrator, the Issuer and the Eligible Lender Trustee to file any claim in,
or otherwise take any action with respect to, any insolvency proceeding that was
instituted against
30
the Issuer by a Person other than the Servicer, the Administrator, the Issuer or
the Eligible Lender Trustee.
Section 8.10 Limitation of Liability of Eligible Lender Trustee and
Indenture Trustee.
(a) Notwithstanding anything contained herein to the contrary,
this Agreement has been executed and delivered by Chase Manhattan Bank USA,
National Association, not in its individual capacity but solely in its capacity
as Eligible Lender Trustee of the Issuer, and in no event shall Chase Manhattan
Bank USA, National Association, in its individual capacity have any liability
for the representations, warranties, covenants, agreements or other obligations
of the Issuer or the Eligible Lender Trustee 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.
(b) Notwithstanding anything contained herein to the contrary,
this Agreement has been executed and delivered by Deutsche Bank Trust Company
Americas, not in its individual capacity but solely as Indenture Trustee, and in
no event shall Deutsche Bank Trust Company Americas 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) The rights of and protections of the Indenture Trustee
under the Indenture shall be incorporated as though explicitly set forth herein.
Section 8.11 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO THE
CONFLICT OF LAW PROVISIONS THEREOF, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF
THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 8.12 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 8.13 Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.
Section 8.14 Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition 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. Each of the parties named on the signature pages to this
Agreement by execution of this Agreement agrees, for the benefit of the
Administrator and the other signatories hereto, to be bound by the terms of this
Agreement and the other Basic Documents to the extent reference is made in such
document to such party.
Section 8.15 Excess Distribution Certificate.
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Any holder of the Excess Distribution Certificate, as evidenced by
its agreement to accept the rights conferred under the Excess Distribution
Certificate, is hereby deemed to accept all obligations of the Depositor under
this Agreement.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed and delivered as of the date first above written.
SLM FUNDING LLC,
in its capacity as Depositor and as initial
holder of the Excess Distribution Certificate
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
XXXXXX XXX, INC.,
in its capacity as Servicer and Administrator
By: /s/ XXXXX X. XXXXXX
Name: Xxxxx X. Xxxxxx
Title: Vice President
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SLM STUDENT LOAN TRUST 2004-4
By: CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, not in its individual capacity
but solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, not in its individual capacity
but solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
DEUTSCHE BANK TRUST COMPANY AMERICAS, not in
its individual capacity but solely as
Indenture Trustee
By: /s/ XXXXXXX X.X. XXXX
Name: Xxxxxxx H.Y. Voon
Title: Assistant Vice President
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