EXHIBIT 4.3
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INDENTURE
among
SLM STUDENT LOAN TRUST 2004-3
as the Issuer,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as the Eligible Lender Trustee
and
THE BANK OF NEW YORK,
not in its individual capacity but
solely as the Indenture Trustee
Dated as of March 1, 2004
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TABLE OF CONTENTS
Page
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ARTICLE I
Definitions and Usage
SECTION 1.1 Definitions and Usage................................................................... 2
SECTION 1.2 Incorporation by Reference of Trust Indenture Act....................................... 2
ARTICLE II
The Notes
SECTION 2.1 Form.................................................................................... 3
SECTION 2.2 Execution, Authentication and Delivery.................................................. 4
SECTION 2.3 Temporary Notes......................................................................... 5
SECTION 2.4 Registration; Registration of Transfer and Exchange..................................... 5
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes.............................................. 7
SECTION 2.6 Persons Deemed Owner.................................................................... 8
SECTION 2.7 Payment of Principal and Interest; Note Interest Shortfall.............................. 8
SECTION 2.8 Cancellation............................................................................ 9
SECTION 2.9 Release of Collateral................................................................... 9
SECTION 2.10 Book-Entry Notes........................................................................ 9
SECTION 2.11 Notices to Clearing Agency.............................................................. 10
SECTION 2.12 Definitive Notes........................................................................ 11
SECTION 2.13 Transfer Restrictions................................................................... 11
ARTICLE III
Covenants
SECTION 3.1 Payments to Noteholders and each Swap Counterparty...................................... 11
SECTION 3.2 Maintenance of Office or Agency......................................................... 12
SECTION 3.3 Money for Payments to be Held in Trust.................................................. 13
SECTION 3.4 Existence............................................................................... 14
SECTION 3.5 Protection of Indenture Trust Estate.................................................... 14
SECTION 3.6 Opinions as to Indenture Trust Estate................................................... 15
SECTION 3.7 Performance of Obligations; Servicing of Trust Student Loans............................ 15
SECTION 3.8 Negative Covenants...................................................................... 18
SECTION 3.9 Annual Statement as to Compliance....................................................... 18
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain Terms..................................... 19
SECTION 3.11 Successor or Transferee................................................................. 20
SECTION 3.12 No Other Business....................................................................... 20
SECTION 3.13 No Borrowing............................................................................ 20
SECTION 3.14 Obligations of Servicer and Administrator............................................... 21
SECTION 3.15 Guarantees, Loans, Advances and Other Liabilities....................................... 21
SECTION 3.16 Capital Expenditures.................................................................... 21
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SECTION 3.17 Restricted Payments..................................................................... 21
SECTION 3.18 Notice of Events of Default............................................................. 21
SECTION 3.19 Further Instruments and Acts............................................................ 22
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1 Satisfaction and Discharge of Indenture................................................. 22
SECTION 4.2 Application of Trust Money.............................................................. 23
SECTION 4.3 Repayment of Moneys Held by Paying Agent................................................ 23
SECTION 4.4 Auction of Trust Student Loans.......................................................... 23
ARTICLE V
Remedies
SECTION 5.1 Events of Default....................................................................... 24
SECTION 5.2 Acceleration of Maturity; Rescission and Annulment...................................... 25
SECTION 5.3 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee............... 25
SECTION 5.4 Remedies; Priorities.................................................................... 28
SECTION 5.5 Optional Preservation of the Trust Student Loans........................................ 31
SECTION 5.6 Limitation of Suits..................................................................... 31
SECTION 5.7 Unconditional Rights of Noteholders to Receive Principal and Interest................... 32
SECTION 5.8 Restoration of Rights and Remedies...................................................... 32
SECTION 5.9 Rights and Remedies Cumulative.......................................................... 32
SECTION 5.10 Delay or Omission Not a Waiver.......................................................... 32
SECTION 5.11 Control by Noteholders.................................................................. 33
SECTION 5.12 Waiver of Past Defaults................................................................. 33
SECTION 5.13 Undertaking for Costs................................................................... 33
SECTION 5.14 Waiver of Stay or Extension Laws........................................................ 34
SECTION 5.15 Action on Notes......................................................................... 34
SECTION 5.16 Performance and Enforcement of Certain Obligations...................................... 34
ARTICLE VI
The Indenture Trustee
SECTION 6.1 Duties of Indenture Trustee............................................................. 35
SECTION 6.2 Rights of Indenture Trustee............................................................. 36
SECTION 6.3 Individual Rights of Indenture Trustee.................................................. 37
SECTION 6.4 Indenture Trustee's Disclaimer.......................................................... 37
SECTION 6.5 Notice of Defaults...................................................................... 37
SECTION 6.6 Reports by Indenture Trustee to Noteholders............................................. 37
SECTION 6.7 Compensation and Indemnity.............................................................. 37
SECTION 6.8 Replacement of Indenture Trustee........................................................ 38
SECTION 6.9 Successor Indenture Trustee by Merger................................................... 39
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee........................................... 39
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SECTION 6.11 Eligibility; Disqualification........................................................... 41
SECTION 6.12 Preferential Collection of Claims Against the Issuer.................................... 41
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.1 Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders.................. 41
SECTION 7.2 Preservation of Information; Communications to Noteholders.............................. 41
SECTION 7.3 Reports by Issuer....................................................................... 42
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.1 Collection of Money..................................................................... 42
SECTION 8.2 Trust Accounts.......................................................................... 43
SECTION 8.3 General Provisions Regarding Accounts................................................... 43
SECTION 8.4 Release of Indenture Trust Estate....................................................... 44
SECTION 8.5 Opinion of Counsel...................................................................... 44
ARTICLE IX
Supplemental Indentures
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders.................................. 45
SECTION 9.2 Supplemental Indentures with Consent of Noteholders..................................... 46
SECTION 9.3 Execution of Supplemental Indentures.................................................... 47
SECTION 9.4 Effect of Supplemental Indenture........................................................ 47
SECTION 9.5 Conformity with Trust Indenture Act..................................................... 48
SECTION 9.6 Reference in Notes to Supplemental Indentures........................................... 48
ARTICLE X
Redemption of Notes
SECTION 10.1 Redemption.............................................................................. 48
SECTION 10.2 Form of Redemption Notice............................................................... 48
SECTION 10.3 Notes Payable on Redemption Date........................................................ 49
ARTICLE XI
Miscellaneous
SECTION 11.1 Compliance Certificates and Opinions, etc............................................... 49
SECTION 11.2 Form of Documents Delivered to Indenture Trustee........................................ 51
SECTION 11.3 Acts of Noteholders..................................................................... 51
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer and Rating Agencies......................... 52
SECTION 11.5 Notices to Noteholders; Waiver.......................................................... 53
SECTION 11.6 Alternate Payment and Notice Provisions................................................. 53
SECTION 11.7 Conflict with Trust Indenture Act....................................................... 53
SECTION 11.8 Effect of Headings and Table of Contents................................................ 54
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SECTION 11.9 Successors and Assigns.................................................................. 54
SECTION 11.10 Separability............................................................................ 54
SECTION 11.11 Benefits of Indenture................................................................... 54
SECTION 11.12 Legal Holidays.......................................................................... 54
SECTION 11.13 Governing Law........................................................................... 54
SECTION 11.14 Counterparts............................................................................ 55
SECTION 11.15 Recording of Indenture.................................................................. 55
SECTION 11.16 Trust Obligations....................................................................... 55
SECTION 11.17 No Petition............................................................................. 55
SECTION 11.18 Inspection.............................................................................. 55
SECTION 11.19 Subordination........................................................................... 56
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APPENDICES, SCHEDULES AND EXHIBITS
APPENDIX A-1 Definitions and Usage
APPENDIX A-2 Reset Rate Note Procedures
APPENDIX A-3 Transfer Restrictions for the Reset Rate Notes
SCHEDULE A Schedule of Trust Student Loans
SCHEDULE B Location of Trust Student Loan Files
EXHIBIT A Forms of Notes
EXHIBIT B Form of Note Depository Agreement for U.S. Dollar
Denominated Notes
EXHIBIT C Form of Note Depository Agreement for Notes Denominated in a
Currency Other than U.S. Dollars
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INDENTURE, dated as of March 1, 2004, among SLM STUDENT LOAN
TRUST 2004-3, a Delaware statutory trust (the "Issuer"), CHASE MANHATTAN BANK
USA, NATIONAL ASSOCIATION, a national banking association, not in its individual
capacity but solely as eligible lender trustee on behalf of the Issuer (the
"Eligible Lender Trustee"), and THE BANK OF NEW YORK, a New York banking
corporation, not in its individual capacity but solely as indenture trustee (the
"Indenture Trustee").
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the holders of the Issuer's
Student Loan-Backed Notes (the "Notes") and, after the Notes have been paid in
full, for the benefit of any Currency Swap Counterparty:
GRANTING CLAUSE
The Issuer and, with respect to the Trust Student Loans, the
Eligible Lender Trustee hereby Grant to the Indenture Trustee, as trustee for
the benefit of the Noteholders and, subject to the provisions of Section 11.19,
any Currency Swap Counterparty, effective as of the Closing Date all of their
right, title and interest in and to the following:
(a) the Trust Student Loans, and all obligations of the Obligors
thereunder including all moneys accrued and paid thereunder on or after the
Cutoff Date and all guaranties and other rights relating to the Trust Student
Loans;
(b) the Servicing Agreement, including the right of the Issuer to
cause the Servicer to purchase Trust Student Loans from the Issuer under
circumstances described therein;
(c) the Sale Agreement, including the right of the Issuer to cause
the Depositor to repurchase Trust Student Loans from the Issuer under the
circumstances described therein and including the rights of the Depositor under
the Purchase Agreements;
(d) the SLMA Purchase Agreement and the SLM ELC Purchase
Agreement, to the extent that the rights of the Depositor thereunder have been
assigned to the Issuer pursuant to the Sale Agreement, including the right of
the Depositor to cause SLMA or SLM ELC, as the case may be, to repurchase Trust
Student Loans from the Depositor under the circumstances described in the
applicable Purchase Agreement;
(e) the Administration Agreement, the Interest Rate Cap Agreement,
the Remarketing Agreement, the Initial Currency Swap Agreements and any other
Swap Agreements to be entered into from time to time and any agreement
representing Eligible Repurchase Obligations between the Trust and an Eligible
Repo Counterparty to be entered into from time to time;
(f) each Guarantee Agreement, including the right of the Issuer to
cause the related Guarantor to make Guarantee Payments in respect of the Trust
Student Loans;
(g) the Trust Accounts and all funds on deposit from time to time
in the Trust Accounts, including the Reserve Account Initial Deposit, the
Collection Account Initial Deposit and the Capitalized Interest Account Initial
Deposit, if any, and all investments and proceeds thereof (including all income
thereon); and
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(h) all present and future claims, demands, causes and choses in
action in respect of any or all of the foregoing and all payments on or under
and all proceeds of every kind and nature whatsoever in respect of any or all of
the foregoing, including all proceeds of the conversion, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, general
intangibles, deposit accounts, insurance proceeds, condemnation awards, rights
to payment of any and every kind and other forms of obligations and receivables,
instruments and other property which at any time constitute all or part of or
are included in the proceeds of any of the foregoing (collectively, the
"Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, to secure
compliance with the provisions of this Indenture and, subject to the provisions
of Section 11.19, to secure amounts owing to any Currency Swap Counterparty
under the related Currency Swap Agreement, all as provided in this Indenture.
The Indenture Trustee, as indenture trustee on behalf of the
Noteholders and each Currency Swap Counterparty, acknowledges such Grant,
accepts the trusts under this Indenture in accordance with the provisions of
this Indenture and agrees to perform its duties required in this Indenture to
the best of its ability to the end that the interests of the Noteholders and
each Currency Swap Counterparty under the related Currency Swap Agreement may be
adequately and effectively protected.
ARTICLE I
Definitions and Usage
SECTION 1.1 Definitions and Usage. Except as otherwise
specified herein or as the context may otherwise require, capitalized terms used
but not otherwise defined herein are defined in Appendix A-1 to this Indenture,
which also contains rules as to usage that shall be applicable herein.
SECTION 1.2 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Indenture Trustee.
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"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule have the meaning assigned to them by such definitions.
ARTICLE II
The Notes
SECTION 2.1 Form. The Notes, together with the Indenture
Trustee's certificate of authentication, shall be in substantially the forms set
forth in Exhibit A, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing the Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
The Definitive Notes shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods (with
or without steel engraved borders), all as determined by the officers executing
such Notes, as evidenced by their execution of such Notes.
The terms of the Notes set forth in Exhibit A are part of the
terms of this Indenture.
Each class of Floating Rate Notes will be represented by
interests in a book-entry note certificate deposited on the Closing Date with
The Bank of New York, as custodian for DTC (the "DTC Custodian"), and registered
in the name of Cede & Co. as initial nominee for DTC.
Each class of Reset Rate Notes denominated in a currency other
than U.S. Dollars may be offered and sold only to QIBs in reliance on Rule 144A
or to a non-U.S. Person (as defined in Regulation S) outside the United States
of America in reliance on Regulation S, as applicable and will be represented by
interests in either a Rule 144A global registered note certificate (the
"Non-U.S. Rule 144A Global Note Certificate") or a Regulation S global
registered note certificate (the "Regulation S Global Note Certificate," and
collectively with the Non-U.S. Rule 144A Global Note Certificate, the "Non-U.S.
Global Note Certificates"). On the Closing Date, the entire Outstanding Amount
of each class of Reset Rate Notes will be allocated between the corresponding
Non-U.S. Rule 144A Global Note Certificate and Regulation S Global Note
Certificate, as applicable. Each Non-U.S. Global Note Certificate will be
registered in the name of the Joint Nominee, and will be deposited on the
Closing Date with the Regulation S Custodian. There will be only one Non-U.S.
Rule 144A Global Note Certificate and one Regulation S Global Note Certificate
for each class of Reset Rate Notes. On the Closing Date, with respect to each
class of Reset Rate Notes, a corresponding U.S. Rule 144A Global Note
Certificate will be deposited with the DTC Custodian and will have an
outstanding principal
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balance of zero for so long as such class of Reset Rate Notes is denominated in
a currency other than U.S. Dollars.
Each class of Reset Rate Notes denominated in U.S. Dollars may
be offered and sold only to QIBs in reliance on Rule 144A or to a non-U.S.
Person (as defined in Regulation S) outside the United States in reliance on
Regulation S, as applicable, and the entire outstanding principal balance of
each class of Reset Rate Notes will be allocated between a global registered
note certificate (the "U.S. Rule 144A Global Note Certificate", and, together
with the Non-U.S. Global Note Certificates, the "Global Note Certificates"),
deposited with the DTC Custodian and registered in the name of Cede & Co. as
initial nominee for DTC, the Non-U.S. Rule 144A Global Note Certificate and the
Regulation S Global Note Certificate. Transfers of interest among the U.S. Rule
144A Global Note Certificate, the Non-U.S. Rule 144A Global Note Certificate and
the Regulation S Global Note Certificate on any date (other than a Reset Date)
when the related class of Reset Rate Notes is then denominated in U.S. Dollars
will be governed by the usual and customary rules and regulations applicable to
DTC, Euroclear and Clearstream, as applicable.
At all times during any Reset Period when a class of Reset
Notes is to be denominated in a currency other than U.S. Dollars, the aggregate
Outstanding Amount of such class of Reset Rate Notes will be allocated between
the corresponding Non-U.S. Rule 144A Global Note Certificate and Regulation S
Global Note Certificate, either of which may, from time to time during the
related Reset Period, represent between zero and 100% of the Outstanding Amount
of such class of Reset Rate Notes and the corresponding U.S. Rule 144A Global
Note Certificate will have an outstanding principal balance of zero. At all
times during any Reset Period when a class of Reset Rate Notes is to be
denominated in U.S. Dollars, the aggregate Outstanding Amount of such class of
Reset Rate Notes will be allocated among the three Global Note Certificates, any
of which may, from time to time during the related Reset Period, represent
between zero and 100% of the Outstanding Amount of such class of Reset Rate
Notes.
SECTION 2.2 Execution, Authentication and Delivery. The Notes
shall be executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals
who were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Order authenticate and
deliver Notes for original issue in an aggregate principal amount of
$3,068,579,000, using the Initial Pounds Sterling Exchange Rate with respect to
the principal amount of (pound)724,000,000 of the Reset Rate Notes included in
such amount. The aggregate principal amount of Notes Outstanding at any time may
not exceed such amount except as provided in Section 2.5. On each Spread
Determination Date, upon receipt of an Issuer Order, the Indenture Trustee shall
deliver a revised Schedule A for the Reset Rate Notes to the Custodians.
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Each Note shall be dated the date of its authentication. The
Floating Rate Class A Notes shall be issuable as registered notes in minimum
denominations of $10,000 and additional increments of $1,000. The Class B Notes
shall be issuable as registered notes in minimum denominations of $100,000 and
additional increments of $1,000.
During any Reset Period when a class of Reset Rate Notes is
denominated in U.S. Dollars, such Reset Rate Notes shall be issued in minimum
denominations of $250,000, and additional increments of $1. During any Reset
Period when a class of Reset Rate Notes is denominated in a currency other than
U.S. Dollars, such Reset Rate Notes shall be issued in minimum denominations of
the applicable currency equivalent (approximately) of $250,000 and additional
increments of the applicable currency equivalent of $1 (which shall be
determined by reference to the exchange rate to be set forth in the related
Currency Swap Agreement); provided, that during any Reset Period when a class of
Reset Rate Notes is denominated in Pounds Sterling, such Reset Rate Notes shall
be issued in minimum denominations of (pound)100,000 and additional increments
of (pound)1; and provided, further, that during any Reset Period when a class of
Reset Rate Notes is denominated in Euros, such Reset Rate Notes shall be issued
in minimum denominations of (euro)100,000 and additional increments of (euro)1.
No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.
SECTION 2.3 Temporary Notes. Pending the preparation of
Definitive Notes, the Issuer may execute, and upon receipt of an Issuer Order
the Indenture Trustee shall authenticate and deliver, temporary Notes which are
printed, lithographed, typewritten, mimeographed or otherwise produced, of the
tenor of the Definitive Notes in lieu of which they are issued and with such
variations not inconsistent with the terms of this Indenture determined to be
appropriate by the Responsible Officer of the Issuer executing the temporary
Notes, as evidenced by his or her execution of such temporary Notes.
If temporary Notes are issued, the Issuer will cause
Definitive Notes to be prepared without unreasonable delay. After the
preparation of Definitive Notes, the temporary Notes shall be exchangeable for
Definitive Notes upon surrender of the temporary Notes at the office or agency
of the Issuer to be maintained as provided in Section 3.2, without charge to the
Noteholder. Upon surrender for cancellation of any one or more temporary Notes,
the Issuer shall execute and the Indenture Trustee shall authenticate and
deliver in exchange therefor a like principal amount of Definitive Notes of
authorized denominations. Until so exchanged, the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as Definitive
Notes.
SECTION 2.4 Registration; Registration of Transfer and
Exchange. The Issuer shall cause to be kept a register (the "Note Register") in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and the registration of transfers of
Notes. The Indenture Trustee shall be "Note Registrar" for the
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purpose of registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar.
If a Person other than the Indenture Trustee is appointed by
the Issuer as Note Registrar, the Issuer shall give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate executed on behalf of the Note Registrar by an Executive
Officer thereof as to the names and addresses of the Noteholders and the
principal amounts and number of such Notes.
Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.2 or,
with respect to the Reset Rate Notes, to the Note Registrar or any transfer
agent, as applicable, if the requirements of Section 8-401(1) of the UCC are
met, the Issuer shall execute, and the Indenture Trustee shall authenticate and
the Noteholder shall obtain from the Indenture Trustee, in the name of the
designated transferee or transferees, one or more new Notes in any authorized
denominations and a like aggregate principal amount.
On each Reset Date on which either the All Hold Rate is not
applicable or fewer than 100% of a class of Reset Rate Noteholders permissibly
elect to hold their Reset Rate Notes, the Indenture Trustee shall allocate the
aggregate Outstanding Amount of such class of Reset Rate Notes, if such class of
Reset Rate Notes is to be denominated in U.S. Dollars during the immediately
following Reset Period, to the Global Note Certificates, any of which may, from
time to time during the related Reset Period, represent between zero and 100% of
the Outstanding Amount of such Reset Rate Notes. On any Reset Date when a class
of Reset Rate Notes is to be denominated in a currency other than U.S. Dollars
during the immediately following Reset Period, the Outstanding Amount of such
class of Reset Rate Notes shall be allocated entirely to the Non-U.S. Global
Note Certificates, as applicable, and the corresponding U.S. Rule 144A Global
Certificate will have an outstanding principal balance of zero. Any transfer of
a class of Reset Rate Notes when such class is denominated in a non-U.S. Dollar
Currency (other than on a Reset Date) between the related U.S. Rule 144A Global
Note Certificate and the related Non-U.S. Global Note Certificates is not
permitted and any attempt or inadvertent transfer shall be null and void and of
no effect.
At the option of the Noteholder, Notes may be exchanged for
other Notes in any authorized denominations and a like aggregate principal
amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, the Issuer shall execute,
and the Indenture Trustee shall authenticate and the Noteholder shall obtain
from the Indenture Trustee, the Notes which the Noteholder making the exchange
is entitled to receive.
All Notes issued upon any registration of transfer or exchange
of Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
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Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by the Noteholder thereof or such Noteholder's attorney duly authorized
in writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar, which requirements
include membership or participation in Securities Transfer Agent's Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Exchange Act.
No service charge shall be made to a Noteholder for any
registration of transfer or exchange of Notes, but the Indenture Trustee may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 2.3 or 9.6 not
involving any transfer.
The preceding provisions of this Section notwithstanding, the
Issuer shall not be required to make and the Note Registrar need not register
transfers or exchanges of Notes selected for redemption or of any Note for a
period of 15 days preceding the due date for any payment with respect to the
Note.
Any transfer or assignment of any Note or any interest in any
Note that is not effected pursuant to the provisions of this Indenture
(including, without limitation, this Section 2.4, Section 2.13 and Appendix A-3
to this Indenture), such as a transfer or assignment not reflected on the Note
Register, shall be null and void and shall not be taken into account by, or be
binding upon, the Indenture Trustee or any other party.
SECTION 2.5 Mutilated, Destroyed, Lost or Stolen Notes. If (i)
any mutilated Note is surrendered to the Indenture Trustee, or the Indenture
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, and (ii) there is delivered to the Issuer and the Indenture Trustee
such security or indemnity as may be required by each of them to hold the Issuer
and the Indenture Trustee harmless, then, in the absence of notice to the
Issuer, the Note Registrar or the Indenture Trustee that such Note has been
acquired by a bona fide purchaser, and provided that the requirements of Section
8-405 of the UCC are met, the Issuer shall execute and upon its request the
Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Note, a replacement Note;
provided, however, that if any such destroyed, lost or stolen Note, but not a
mutilated Note, shall have become or within 15 days shall be due and payable, or
shall have been called for redemption, instead of issuing a replacement Note,
the Issuer may pay such destroyed, lost or stolen Note when so due or payable or
upon the Redemption Date without surrender thereof. If, after the delivery of
such replacement Note or payment of a destroyed, lost or stolen Note pursuant to
the proviso to the preceding sentence, a bona fide purchaser of the original
Note in lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
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provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section,
the Issuer may require the payment by the Noteholder thereof of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.6 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of, interest, if any, on
such Note and for all other purposes whatsoever, whether or not such Note be
overdue, and neither the Issuer, the Indenture Trustee nor any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.
SECTION 2.7 Payment of Principal and Interest; Note Interest
Shortfall. (a) The Floating Rate Notes shall accrue interest as provided in such
Floating Rate Notes, which shall be substantially in the form of Exhibits X-0,
X-0, X-0, X-0, A-5 and A-12 and each class of Reset Rate Notes shall accrue
interest as provided in such Reset Rate Notes, which shall be substantially in
the form of Exhibit X-0, X-0, X-0, X-0, A-10 or A-11, and such interest shall be
payable on each applicable Distribution Date as specified therein, subject to
Section 3.1. Any installment of interest or principal, if any, payable on any
Note which is punctually paid or duly provided for by the Issuer on the
applicable Distribution Date shall be paid to the Person in whose name such Note
(or one or more Predecessor Notes) is registered on the applicable Record Date
by check mailed first-class, postage prepaid to such Person's address as it
appears on the Note Register on such Record Date, except that, unless Definitive
Notes have been issued pursuant to Section 2.12, with respect to Notes
registered on the Record Date in the name of the nominee of the applicable
Clearing Agency, for the Notes, payment shall be made by wire transfer in
immediately available funds to the account designated by such nominee and except
for the final installment of principal payable with respect to such Note on a
Distribution Date or on the Note Final Maturity Date for such Note which shall
be payable as provided below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.3.
(b) The principal amount of each class of Floating Rate Notes
shall be payable on each applicable Distribution Date as provided in the forms
of Notes set forth in Exhibits X-0, X-
0
0, X-0, X-0, A-5 and A-12 and the principal amount of each class of Reset Rate
Notes shall be payable on each applicable Distribution Date as set forth in
Exhibit X-0, X-0, X-0, X-0, A-10 or A-11 and in Appendix A-2 to this Indenture.
Notwithstanding the foregoing, the entire unpaid principal amount of each class
of the Notes shall be due and payable, if not previously paid, on the Note Final
Maturity Date for such class of Notes and on the date on which an Event of
Default shall have occurred and be continuing if the Indenture Trustee or the
Noteholders of the Notes representing at least a majority of the Outstanding
Amount of the Notes have declared the Notes to be immediately due and payable in
the manner provided in Section 5.2. All principal payments on the Notes shall be
made pro rata to the specific class of Noteholders entitled thereto. The
Indenture Trustee shall notify the Person in whose name a Note is registered at
the close of business on the Record Date preceding the Distribution Date on
which the Issuer expects that the final installment of principal of and interest
on such Note will be paid. Such notice shall be mailed or transmitted by
facsimile prior to such final Distribution Date and shall specify that such
final installment will be payable only upon presentation and surrender of such
Note and shall specify the place where such Note may be presented and
surrendered for payment of such installment. Notices in connection with
redemptions of Notes shall be mailed to Noteholders as provided in Section 10.2.
(c) If the Issuer defaults in a payment of interest at the
applicable Note Rate on the Notes, the Issuer shall pay the resulting Note
Interest Shortfall on the following Distribution Date as provided in the
Administration Agreement.
SECTION 2.8 Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section, except as expressly permitted
by this Indenture. All canceled Notes may be held or disposed of by the
Indenture Trustee in accordance with its standard retention or disposal policy
as in effect at the time, unless the Issuer shall direct by an Issuer Order that
they be returned to it and so long as such Issuer Order is timely and the Notes
have not been previously disposed of by the Indenture Trustee.
SECTION 2.9 Release of Collateral. Subject to Sections 3.1(b)
and 11.19 and the terms of the Basic Documents, the Indenture Trustee shall
release property from the lien of this Indenture only upon receipt of an Issuer
Request accompanied by an Officers' Certificate of the Issuer, an Opinion of
Counsel and Independent Certificates in accordance with TIA Section 314(c) and
314(d)(1) or an Opinion of Counsel in lieu of such Independent Certificates to
the effect that the TIA does not require any such Independent Certificates.
SECTION 2.10 Book-Entry Notes. The Notes, upon original
issuance, will be issued in the form of typewritten Notes representing the
Book-Entry Notes, to be delivered to the applicable initial Clearing Agency by
the Issuer, or by the Indenture Trustee on behalf of the Issuer. Such Notes
shall initially be registered on the Note Register in the name of the nominee of
each initial Clearing Agency, and no Note Owner shall receive a definitive,
fully registered
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note (a "Definitive Note") representing such Note Owner's interest in such Note,
except as provided in Section 2.12. Unless and until Definitive Notes have been
issued to Note Owners pursuant to Section 2.12:
(i) the provisions of this Section shall be in full force
and effect;
(ii) the Note Registrar and the Indenture Trustee, and
their respective directors, officers, employees and agents, may deal with the
applicable Clearing Agency for all purposes (including the payment of principal
of and interest and other amounts on the Notes) as the authorized representative
of the Note Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture, the provisions of this
Section shall control;
(iv) the rights of Note Owners shall be exercised only
through the applicable Clearing Agency and shall be limited to those established
by law and agreements between such Note Owners and the applicable Clearing
Agency and/or the applicable Clearing Agency Participants pursuant to the Note
Depository Agreements; and unless and until Definitive Notes are issued pursuant
to Section 2.12, the applicable initial Clearing Agency will make book-entry
transfers among the applicable Clearing Agency Participants and receive and
transmit payments of principal of and interest and other amounts on the Notes to
such applicable Clearing Agency Participants;
(v) whenever this Indenture requires or permits actions
to be taken based upon instructions or directions of Noteholders of Notes
evidencing a specified percentage of the Outstanding Amount of the Notes, the
applicable Clearing Agency shall be deemed to represent such percentage only to
the extent that it has received instructions to such effect from Note Owners
and/or applicable Clearing Agency Participants owning or representing,
respectively, such required percentage of the beneficial interest in the Notes
and has delivered such instructions to the Indenture Trustee; and
(vi) upon acquisition or transfer of a beneficial interest
in any Book-Entry Note by, for or with the assets of, an employee benefit plan
or other retirement arrangement ("Plan"), such Note Owner shall be deemed to
have represented that such acquisition or purchase will not constitute or
otherwise result in: (i) in the case of a Plan subject to Section 406 of ERISA
or Section 4975 of the Code, a non-exempt prohibited transaction in violation of
Section 406 of ERISA or Section 4975 of the Code which is not covered by a class
or other applicable exemption and (ii) in the case of a Plan subject to a
substantially similar federal, state, local or foreign law ("Similar Law"), a
non-exempt violation of such substantially Similar Law. Any transfer found to
have been made in violation of such deemed representation shall be null and void
and of no effect.
SECTION 2.11 Notices to Clearing Agency. Whenever a notice or
other communication is required under this Indenture to be given to Noteholders,
unless and until Definitive Notes shall have been issued to Note Owners pursuant
to Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to the applicable Clearing Agency.
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SECTION 2.12 Definitive Notes. If (i) the Administrator
advises the Indenture Trustee in writing that a Clearing Agency (a) is closed
for business for a continuous period of 14 days (other than by reason of
holiday, statutory or otherwise), (b) announces an intention to cease business
permanently (or does so and no alternative clearing system acceptable to the
Indenture Trustee is then available), or (c) at any time, is unwilling or unable
to continue as, or ceases to be, a clearing agency registered under all
applicable laws, and a successor clearing agency which is registered as a
clearing agency under all applicable laws is not appointed by the Administrator
within 90 days of such event, (ii) the Administrator at its option advises the
Indenture Trustee in writing that it elects to terminate the book-entry system
through that Clearing Agency or (iii) after the occurrence of an Event of
Default, a Servicer Default or an Administrator Default, Note Owners
representing beneficial interests aggregating at least a majority of the
Outstanding Amount of the applicable Notes advise the applicable Clearing Agency
(which shall then notify the Indenture Trustee) in writing that the continuation
of a book-entry system through such Clearing Agency is no longer in the best
interests of such Note Owners, then the Indenture Trustee shall cause such
Clearing Agency to notify all Note Owners cleared, through such Clearing Agency,
of the occurrence of any such event and of the availability of Definitive Notes
to Note Owners requesting the same. Upon surrender to the Indenture Trustee of
the typewritten Notes representing the Book-Entry Notes by a Clearing Agency,
accompanied by registration instructions, the Issuer shall execute and the
Indenture Trustee shall authenticate the Definitive Notes in accordance with the
instructions of such Clearing Agency, which shall include, without limitation,
the identity and payment instructions for all Noteholders of the applicable
Notes. None of the Issuer, the Note Registrar or the Indenture Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions. Upon the issuance
of Definitive Notes, the Indenture Trustee shall recognize the holders of the
Definitive Notes as Noteholders.
Upon acquisition or transfer of a Definitive Note by, for or
with the assets of, a Plan, such Note Owner shall be deemed to have represented
that such acquisition or purchase will not constitute or otherwise result in:
(i) in the case of a Plan subject to Section 406 of ERISA or Section 4975 of the
Code, a non-exempt prohibited transaction in violation of Section 406 of ERISA
or Section 4975 of the Code which is not covered by a class or other applicable
exemption and (ii) in the case of a Plan subject to a substantially Similar Law,
a non-exempt violation of such substantially Similar Law. Any transfer found to
have been made in violation of such deemed representation shall be null and void
and of no effect.
SECTION 2.13 Transfer Restrictions. Each Noteholder and Note
Owner of a Reset Rate Note shall be subject to the restrictions on transfer
thereof set forth in Appendix A-3 to this Indenture.
ARTICLE III
Covenants
SECTION 3.1 Payments to Noteholders and each Swap
Counterparty.
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(a) The Issuer shall duly and punctually pay the principal and
interest, if any, with respect to the Notes in accordance with the terms of the
Notes and this Indenture and shall duly and punctually pay amounts, if any,
owing to each Swap Counterparty in accordance with the terms of this Indenture
and the related Swap Agreement. Without limiting the foregoing, the Issuer shall
cause to be distributed to Noteholders and each Swap Counterparty in accordance
with the Administration Agreement that portion of the amounts on deposit in the
Trust Accounts on a Distribution Date or with respect to any Swap Counterparty
amounts on deposit in the relevant Trust Accounts on the date such payment is
due under the related Swap Agreement, which the Noteholders and any Swap
Counterparty are entitled to receive pursuant to Sections 2.7 and 2.8 of the
Administration Agreement. Amounts properly withheld under the Code by any Person
from a payment to any Noteholder of interest and/or principal shall be
considered as having been paid by the Issuer to such Noteholder for all purposes
of this Indenture.
(b) In the event that pursuant to the terms of an applicable Swap
Agreement, a related Swap Counterparty (or its credit support provider) is
required to deposit cash or securities as collateral to secure its obligations
("Swap Collateral"), the Indenture Trustee shall establish and maintain one or
more Eligible Deposit Accounts in the name of the Indenture Trustee for the
benefit of the Issuer and such Swap Counterparty (each a "Swap Agreement
Collateral Account"). All sums on deposit and securities held in any Swap
Agreement Collateral Account shall be used only for the purposes set forth in
the related credit support agreement between the Trust and the related Swap
Counterparty (a "Credit Support Agreement"). Amounts on deposit in any Swap
Agreement Collateral Account may be invested in Eligible Investments at the
written direction of the related Swap Counterparty and on each Distribution
Date, all Investment Earnings actually received by the Indenture Trustee on
amounts on deposit in a Swap Agreement Collateral Account or on securities held
by the Indenture Trustee as Swap Collateral shall be paid directly to the
related Swap Counterparty and not become part of Available Funds in accordance
with the terms of the Credit Support Agreement. All amounts deposited in a Swap
Agreement Collateral Account shall be paid to the Issuer (and become part of
Available Funds on the related Distribution Date) or returned to the related
Swap Counterparty, from time to time, in accordance with the provisions set
forth in the applicable Swap Agreement or the related Credit Support Agreement.
SECTION 3.2 Maintenance of Office or Agency. The Issuer shall
maintain in the Borough of Manhattan, The City of New York and in Luxembourg, so
long as any of the Notes are listed on the Luxembourg Stock Exchange and the
rules of such exchange so require, or in such other jurisdiction if any of the
Notes are listed on another stock exchange of international standing and the
rules of such other exchange so require, an office or agency where Notes may be
surrendered for registration of transfer or exchange, and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer hereby initially appoints the Indenture Trustee to serve as
its agent for the foregoing purposes. The Issuer shall give prompt written
notice to the Indenture Trustee of the location, and of any change in the
location, of any such office or agency. If at any time the Issuer shall fail to
maintain any such office or agency or shall fail to furnish the Indenture
Trustee with the address thereof, such surrenders, notices and demands may be
made or served at the Corporate Trust Office, and the Issuer hereby appoints the
Indenture Trustee as its agent to receive all such surrenders, notices and
demands.
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SECTION 3.3 Money for Payments to be Held in Trust. As
provided in Section 8.2(a) and (b), all payments of amounts due and payable with
respect to any Notes or any Swap Agreement that are to be made from amounts
distributed from the Collection Account or any other Trust Account pursuant to
Sections 2.7 and 2.8 of the Administration Agreement shall be made on behalf of
the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts
so distributed from the Collection Account for payments to Noteholders or any
Swap Counterparty shall be paid over to the Issuer except as provided in this
Section.
On or before the Business Day next preceding each Distribution
Date and Redemption Date, the Issuer shall distribute or cause to be distributed
to the Indenture Trustee (or any other Paying Agent) an aggregate sum sufficient
to pay the amounts then becoming due under the Notes or any Swap Agreement, such
sum to be held in trust for the benefit of the Persons entitled thereto and
(unless the Paying Agent is the Indenture Trustee) shall promptly notify the
Indenture Trustee of its action or failure so to act.
The Issuer shall cause each Paying Agent other than the
Indenture Trustee to execute and deliver to the Indenture Trustee an instrument
in which such Paying Agent shall agree with the Indenture Trustee (and if the
Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the
provisions of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts
due with respect to the Notes or any Swap Agreement in trust for the benefit of
the Persons entitled thereto until such sums shall be paid to such Persons or
otherwise disposed of as herein provided and pay such sums to such Persons as
herein provided;
(ii) give the Indenture Trustee notice of any default by
the Issuer of which it has actual knowledge (or any other obligor upon the
Notes) in the making of any payment required to be made with respect to the
Notes or any Swap Agreement;
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith pay to the
Indenture Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith
pay to the Indenture Trustee all sums held by it in trust for the payments due
under the Notes or any Swap Agreement if at any time it ceases to meet the
standards required to be met by a Paying Agent at the time of its appointment;
and
(v) comply with all requirements of the Code with respect
to the withholding from any payments made by it on any Notes of any applicable
withholding taxes imposed thereon and with respect to any applicable reporting
requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to pay to the Indenture Trustee all sums held in
trust by such Paying Agent, such sums to be held by the Indenture Trustee upon
the same trusts as those upon which the sums were held by such
13
Paying Agent; and upon such payment by any Paying Agent to the Indenture
Trustee, such Paying Agent shall be released from all further liability with
respect to such money.
Subject to applicable laws with respect to escheat of funds,
any money held by the Indenture Trustee or any Paying Agent in trust for the
payment of any amount due with respect to any Note and remaining unclaimed for
two years after such amount has become due and payable shall be discharged from
such trust and be paid to the Issuer on Issuer Request or if the Issuer has been
terminated to the Depositor upon its written request; and the Noteholder thereof
shall thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published once, in
a newspaper published in the English language, customarily published on each
Business Day and of general circulation in The City of New York and in
Luxembourg, so long as any of the Notes are listed on the Luxembourg Stock
Exchange and the rules of such Exchange so require, or in such other
jurisdiction if any of the Notes are listed on another stock exchange of
international standing and the rules of such other exchange so require, notice
that such money remains unclaimed and that, after a date specified therein,
which shall not be less than 30 days from the date of such publication, any
unclaimed balance of such money then remaining will be repaid to the Issuer. The
Indenture Trustee shall also adopt and employ, at the expense of the Issuer, any
other reasonable means of notification of such repayment (including mailing
notice of such repayment to Noteholders whose Notes have been called but have
not been surrendered for redemption or whose right to or interest in moneys due
and payable but not claimed is determinable from the records of the Indenture
Trustee or of any Paying Agent, at the last address of record for each such
Noteholder).
SECTION 3.4 Existence. The Issuer shall keep in full effect
its existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States of
America, in which case the Issuer shall keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and shall
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Indenture Trust Estate.
SECTION 3.5 Protection of Indenture Trust Estate. The Issuer
will from time to time execute and deliver all such supplements and amendments
hereto, all such financing statements and continuation statements and will take
such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry out more effectively the
purposes hereof;
(ii) perfect, publish notice of or protect the validity of
any grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
14
(iv) preserve and defend title to the Indenture Trust
Estate and the rights of the Indenture Trustee, the Noteholders and each Swap
Counterparty in such Indenture Trust Estate against the claims of all persons
and parties.
The Issuer hereby designates the Indenture Trustee its agent
and attorney-in-fact to execute any financing statement, continuation statement
or other instrument required to be executed pursuant to this Section.
SECTION 3.6 Opinions as to Indenture Trust Estate. (a) On the
Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion of
Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording and filing of this Indenture as is
necessary to perfect and make effective the lien and security interest of this
Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.
(b) On or before December 31 in each calendar year, beginning in
2004, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been taken
with respect to the recording, filing, re-recording and refiling of this
Indenture and any indentures supplemental hereto as is necessary to maintain the
lien and security interest created by this Indenture and relating the details of
such action or stating that in the opinion of such counsel no such action is
necessary to maintain such lien and security interest. Such Opinion of Counsel
shall also describe the recording, filing, recording and refiling of this
Indenture and any indentures supplemental hereto that will, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture until December 31 in the following calendar year.
SECTION 3.7 Performance of Obligations; Servicing of Trust
Student Loans. (a) The Issuer will not take any action and will use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Indenture Trust Estate or that would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any such instrument or
agreement, except as expressly provided in this Indenture, any other Basic
Document or such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist it in
performing its duties under this Indenture, and any performance of such duties
by a Person identified to the Indenture Trustee in an Officers' Certificate of
the Issuer shall be deemed to be action taken by the Issuer; provided, however,
the Issuer shall not be liable for any acts of Persons with whom the Issuer has
contracted with reasonable care. Initially, the Issuer has contracted with the
Servicer and the Administrator to assist the Issuer in performing its duties
under this Indenture. The Issuer shall give written notice to the Indenture
Trustee and each Rating Agency of any such contract with any other Person.
(c) The Issuer shall punctually perform and observe all of its
obligations and agreements contained in this Indenture, the other Basic
Documents and the instruments and agreements included in the Indenture Trust
Estate, including filing or causing to be filed all UCC financing statements and
continuation statements prepared by the Issuer and required to be filed
15
by the terms of this Indenture and the Administration Agreement in accordance
with and within the time periods provided for herein and therein. Except as
otherwise expressly provided therein, the Issuer shall not waive, amend, modify,
supplement or terminate any Basic Document or any provision thereof without the
consent of the Indenture Trustee or the Noteholders of at least a majority of
the Outstanding Amount of the Notes. The Issuer shall give written notice to
each Rating Agency of any such waiver, amendment, modification, supplement or
termination.
(d) If a Responsible Officer of the Issuer shall have knowledge of
the occurrence of a Servicer Default or an Administrator Default under the
Servicing Agreement or the Administration Agreement, respectively, the Issuer
shall promptly notify the Indenture Trustee and the Rating Agencies thereof, and
shall specify in such notice the action, if any, the Issuer is taking with
respect to such default. If a Servicer Default shall arise from the failure of
the Servicer to perform any of its duties or obligations under the Servicing
Agreement, or an Administrator Default shall arise from the failure of the
Administrator to perform any of its duties or obligations under the
Administration Agreement, as the case may be, with respect to the Trust Student
Loans, the Issuer shall take all reasonable steps available to it to enforce its
rights under the Basic Documents in respect of such failure.
(e) As promptly as possible after the giving of notice of
termination to the Servicer of the Servicer's rights and powers, pursuant to
Section 5.1 of the Servicing Agreement, or to the Administrator of the
Administrator's rights and powers, pursuant to Section 5.1 of the Administration
Agreement, the Issuer shall appoint a successor servicer (the "Successor
Servicer") or a successor administrator (the "Successor Administrator"),
respectively, and such Successor Servicer or Successor Administrator, as the
case may be, shall accept its appointment by a written assumption in a form
acceptable to the Indenture Trustee. In the event that a Successor Servicer or
Successor Administrator has not been appointed and accepted its appointment at
the time when the Servicer or Administrator, as the case may be, ceases to act
as Servicer or Administrator, respectively, the Indenture Trustee without
further action shall automatically be appointed the Successor Servicer or
Successor Administrator, as the case may be. The Indenture Trustee may resign as
the Successor Servicer or the Successor Administrator by giving written notice
of resignation to the Issuer and in such event will be released from such duties
and obligations, such release not to be effective until the date a new servicer
or a new administrator enters into an agreement with the Issuer as provided
below; provided, however, that nothing herein shall require or permit the
Indenture Trustee to act as Servicer, or otherwise service the Trust Student
Loans, in violation of the Higher Education Act. Upon delivery of any such
notice to the Issuer, the Issuer shall obtain a new servicer as the Successor
Servicer under the Servicing Agreement or a new administrator as the Successor
Administrator under the Administration Agreement, as the case may be. Any
Successor Servicer or Successor Administrator, other than the Indenture Trustee,
shall (i) be an established institution (A) that satisfies any requirements of
the Higher Education Act applicable to servicers and (B) whose regular business
includes the servicing or administration of student loans and (ii) enter into a
servicing agreement or an administration agreement, respectively, with the
Issuer having substantially the same provisions as the provisions of the
Servicing Agreement and the Administration Agreement, as applicable. If within
30 days after the delivery of the notice referred to above, the Issuer shall not
have obtained such a new servicer or new administrator, as the case may be, the
Indenture Trustee may appoint, or may petition a court of competent jurisdiction
to appoint, a Successor Servicer or Successor Administrator; provided, however,
that
16
such right to appoint or to petition for the appointment of any such successor
shall in no event relieve the Indenture Trustee from any obligations otherwise
imposed on it under the Basic Documents until such successor has in fact assumed
such appointment. In connection with any such appointment, the Indenture Trustee
may make such arrangements for the compensation of such successor as it and such
successor shall agree, subject to the limitations set forth below and in the
Servicing Agreement or Administration Agreement, as applicable, and in
accordance with Section 5.2 of the Servicing Agreement and Section 5.2 of the
Administration Agreement, the Issuer shall enter into an agreement with such
successor for the servicing or administration of the Trust Student Loans (such
agreement to be in form and substance satisfactory to the Indenture Trustee). If
the Indenture Trustee shall succeed as provided herein to the Servicer's duties
as Servicer with respect to the Trust Student Loans, or the Administrator's
duties with respect to the Issuer and the Trust Student Loans, as the case may
be, it shall do so in its individual capacity and not in its capacity as
Indenture Trustee and, accordingly, the provisions of Article VI hereof shall be
inapplicable to the Indenture Trustee in its duties as the successor to the
Servicer or the Administrator, as the case may be, and the servicing or
administration of the Trust Student Loans. In case the Indenture Trustee shall
become successor to the Servicer or the Administrator, the Indenture Trustee
shall be entitled to appoint as Servicer or as Administrator, as the case may
be, any one of its Affiliates, provided that such appointment shall not affect
or alter in any way the liability of the Indenture Trustee as Successor Servicer
or Successor Administrator, respectively, in accordance with the terms hereof.
(f) Upon any termination of the Servicer's rights and powers
pursuant to the Servicing Agreement, or any termination of the Administrator's
rights and powers pursuant to the Administration Agreement, as the case may be,
the Issuer shall promptly notify the Indenture Trustee and each Rating Agency.
As soon as a Successor Servicer or a Successor Administrator is appointed, the
Issuer shall notify the Indenture Trustee and each Rating Agency of such
appointment, specifying in such notice the name and address of such Successor
Servicer or such Successor Administrator.
(g) Without derogating from the absolute nature of the assignment
granted to the Indenture Trustee under this Indenture or the rights of the
Indenture Trustee hereunder, the Issuer agrees that it will not, without the
prior written consent of the Indenture Trustee or the Noteholders of at least a
majority in Outstanding Amount of the Notes, amend, modify, waive, supplement,
terminate or surrender, or agree to any amendment, modification, supplement,
termination, waiver or surrender of, the terms of any Collateral or the Basic
Documents, except to the extent otherwise provided in the Basic Documents, or
waive timely performance or observance by the Servicer, the Administrator, the
Depositor, the holder of the Excess Distribution Certificate, SLMA, SLM ELC, the
Issuer or the Eligible Lender Trustee or any Swap Counterparty under the Basic
Documents; provided, however, that no such amendment shall (i) increase or
reduce in any manner the amount of, or accelerate or delay the timing of,
distributions that are required to be made for the benefit of the Noteholders or
any Swap Counterparty, or (ii) reduce the aforesaid percentage of the Notes
which are required to consent to any such amendment, without the consent of the
Noteholders of all the Outstanding Notes. If any such amendment, modification,
supplement or waiver shall be so consented to by the Indenture Trustee or such
Noteholders, the Issuer shall give written notice thereof to each Rating Agency
and agrees, promptly following a request by the Indenture Trustee to do so, to
execute and deliver, in its own name and at its own expense, such agreements,
instruments, consents and
17
other documents as the Indenture Trustee may deem necessary or appropriate in
the circumstances.
SECTION 3.8 Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by this Indenture or
any other Basic Document, sell, transfer, exchange or otherwise dispose of any
of the properties or assets of the Issuer, including those included in the
Indenture Trust Estate, unless directed to do so by the Indenture Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than amounts
properly withheld from such payments under the Code or applicable state law) or
assert any claim against any present or former Noteholder by reason of the
payment of the taxes levied or assessed upon any part of the Indenture Trust
Estate;
(iii) (A) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this Indenture to be amended,
hypothecated, subordinated, terminated or discharged, or permit any Person to be
released from any covenants or obligations with respect to the Notes under this
Indenture except as may be expressly permitted hereby, (B) permit any lien,
charge, excise, claim, security interest, mortgage or other encumbrance (other
than the lien of this Indenture) to be created on or extend to or otherwise
arise upon or burden the Indenture Trust Estate or any part thereof or any
interest therein or the proceeds thereof (other than tax liens and other liens
that arise by operation of law, and other than as expressly permitted by the
Basic Documents) or (C) permit the lien of this Indenture not to constitute a
valid first priority (other than with respect to any such tax or other lien)
security interest in the Indenture Trust Estate; or
(iv) enter into any amendment to the Interest Rate Cap
Agreement or any Swap Agreement to cure any ambiguity in, or to correct or
supplement any provision of the Interest Rate Cap Agreement or any Swap
Agreement, unless the Issuer has determined, and the Indenture Trustee has
agreed in writing at the written direction of the Issuer, that the amendment
will not materially adversely affect the interests of the Noteholders and
provided that the Issuer has provided reasonable notice to the Rating Agencies
of such amendment and the Rating Agency Condition is satisfied.
SECTION 3.9 Annual Statement as to Compliance. The Issuer will
deliver to the Indenture Trustee and each Rating Agency, within 90 days after
the end of each fiscal year of the Issuer (commencing with the fiscal year
ending December 31, 2004), an Officers' Certificate of the Issuer stating that:
(i) a review of the activities of the Issuer during such
year and of performance under this Indenture has been made under such Authorized
Officers' supervision; and
(ii) to the best of such Authorized Officers' knowledge,
based on such review, the Issuer has complied with all conditions and covenants
under this Indenture
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throughout such year, or, if there has been a default in the compliance of any
such condition or covenant, specifying each such default known to such
Authorized Officers and the nature and status thereof.
SECTION 3.10 Issuer May Consolidate, etc., Only on Certain
Terms.
(a) The Issuer shall not consolidate or merge with or into any
other Person, unless:
(i) the Person (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a Person organized and existing
under the laws of the United States of America or any State and shall expressly
assume, by an indenture supplemental hereto, executed and delivered to the
Indenture Trustee, in form satisfactory to the Indenture Trustee, the due and
punctual payment of the principal of, and interest, if any, on all Notes and the
performance or observance of every agreement and covenant of this Indenture and
the other Basic Documents on the part of the Issuer to be performed or observed,
all as provided herein;
(ii) immediately after giving effect to such transaction,
no Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to the effect
that such transaction will not have any material adverse Federal or Delaware
state tax consequence to the Issuer or any Noteholder or any Swap Counterparty;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate of the Issuer and an Opinion of Counsel each
stating that such consolidation or merger and such supplemental indenture comply
with this Article III and that all conditions precedent herein provided for
relating to such transaction have been complied with (including any filing
required by the Exchange Act).
(b) The Issuer shall not convey or transfer all or substantially
all of its properties or assets, including those included in the Indenture Trust
Estate, to any Person, unless:
(i) the Person that acquires by conveyance or transfer
the properties and assets of the Issuer the conveyance or transfer of which is
hereby restricted shall (A) be a United States citizen or a Person organized and
existing under the laws of the United States of America or any State, (B)
expressly assume, by an indenture supplemental hereto, executed and delivered to
the Indenture Trustee, in form satisfactory to the Indenture Trustee, the due
and punctual payment of the principal of, and interest, if any, on all Notes and
the performance or observance of every agreement and covenant of this Indenture
on the part of the Issuer to be performed or observed, all as provided herein,
(C) expressly agree by means of such supplemental indenture that all right,
title and interest so conveyed or transferred shall be subject and subordinate
to the
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rights of Noteholders and any Currency Swap Counterparty, (D) unless otherwise
provided in such supplemental indenture, expressly agree to indemnify, defend
and hold harmless the Issuer against and from any loss, liability or expense
arising under or related to this Indenture and the Notes and (E) expressly agree
by means of such supplemental indenture that such Person (or if a group of
Persons, then one specified Person) shall make all filings with the Commission
(and any other appropriate Person) required by the Exchange Act in connection
with the Notes;
(ii) immediately after giving effect to such transaction,
no Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to the effect
that such transaction will not have any material adverse Federal or Delaware
state tax consequence to the Issuer or any Noteholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate of the Issuer and an Opinion of Counsel each
stating that such conveyance or transfer and such supplemental indenture comply
with this Article III and that all conditions precedent herein provided for
relating to such transaction have been complied with (including any filing
required by the Exchange Act).
SECTION 3.11 Successor or Transferee. (a) Upon any
consolidation or merger of the Issuer in accordance with Section 3.10(a), the
Person formed by or surviving such consolidation or merger (if other than the
Issuer) shall succeed to, and be substituted for, and may exercise every right
and power of, the Issuer under this Indenture with the same effect as if such
Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and properties
of the Issuer pursuant to Section 3.10(b), SLM Student Loan Trust 2004-3 will be
released from every covenant and agreement of this Indenture to be observed or
performed on the part of the Issuer with respect to the Notes immediately upon
the delivery by the Issuer of written notice to the Indenture Trustee stating
that SLM Student Loan Trust 2004-3 is to be so released.
SECTION 3.12 No Other Business. The Issuer shall not engage in
any business other than financing (including entering into Swap Agreements from
time to time), purchasing, owning, selling and managing the Trust Student Loans
and the other assets of the Issuer and related proceeds in the manner
contemplated by this Indenture and the other Basic Documents and activities
incidental thereto.
SECTION 3.13 No Borrowing. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.
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SECTION 3.14 Obligations of Servicer and Administrator. The
Issuer shall cause the Servicer to comply with Sections 3.1, 3.2 and 3.3 of the
Administration Agreement and Section 3.7 of the Servicing Agreement and the
Administrator to comply with Sections 2.11, 3.1, 3.2 and 3.3 of the
Administration Agreement.
SECTION 3.15 Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by this Indenture and the other Basic
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.
SECTION 3.16 Capital Expenditures. The Issuer shall not make
any expenditure (by long-term or operating lease or otherwise) for capital
assets (either realty or personalty).
SECTION 3.17 Restricted Payments. The Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities or a
combination thereof, to the Eligible Lender Trustee or any owner of a beneficial
interest in the Issuer or otherwise with respect to any ownership or equity
interest or security in or of the Issuer or to the Servicer or the
Administrator, (ii) redeem, purchase, retire or otherwise acquire for value any
such ownership or equity interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose; provided, however, that the Issuer
may make, or cause to be made, distributions to the Servicer, the Eligible
Lender Trustee, the Indenture Trustee, the Noteholders, any Swap Counterparty,
any Remarketing Agent, the Administrator, the Depositor and the holder of the
Excess Distribution Certificate as contemplated by, and to the extent funds are
available for such purpose under, this Indenture and the other Basic Documents.
The Issuer will not, directly or indirectly, make payments to or distributions
from the Collection Account except in accordance with this Indenture and the
other Basic Documents.
SECTION 3.18 Notice of Events of Default. The Issuer shall
give the Indenture Trustee, the Rating Agencies and each Swap Counterparty
prompt written notice of each Event of Default hereunder. The Issuer shall give
the Indenture Trustee, the Rating Agencies and each Swap Counterparty prompt
written notice of each default on the part of (i) the Depositor of its
obligations under the Sale Agreement, (ii) SLMA of its obligations under the
SLMA Purchase Agreement, (iii) SLM ELC of its obligations under the SLM ELC
Purchase Agreement, (iv) the Servicer of its obligations under the Servicing
Agreement, or (v) the Administrator of its obligations under the Administration
Agreement. In addition, the Issuer shall deliver to the Indenture Trustee, each
Rating Agency and each Swap Counterparty, within five days after the occurrence
thereof, written notice in the form of an Officers' Certificate of the Issuer of
any event which with the giving of notice and the lapse of time would become an
Event of Default under Section 5.1(iii), its status and what action the Issuer
is taking or proposes to take with respect thereto.
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SECTION 3.19 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.
ARTICLE IV
Satisfaction and Discharge
SECTION 4.1 Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect with respect to the Notes except
as to (i) rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon, (iv) Sections 3.3,
3.4, 3.5, 3.8, 3.10, 3.12 and 3.13, (v) the rights, obligations and immunities
of the Indenture Trustee hereunder (including, without limitation, the rights of
the Indenture Trustee under Section 6.7 and the obligations of the Indenture
Trustee under Section 4.2) and (vi) the rights of Noteholders as beneficiaries
hereof with respect to the property so deposited with the Indenture Trustee
payable to all or any of them, and the Indenture Trustee, on demand of and at
the expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Notes, when:
(a) either
(1) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.5 and (ii) Notes for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Issuer and thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 3.3) have been delivered to the Indenture Trustee
for cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation
(i) have become due and payable,
(ii) will become due and payable at their
respective Note Final Maturity Date, within one year, or
(iii) are to be called for redemption within one
year under arrangements satisfactory to the Indenture Trustee for the giving of
notice of redemption by the Indenture Trustee in the name, and at the expense,
of the Issuer, and the Issuer, in the case of (i), (ii) or (iii) above, has
irrevocably deposited or caused to be irrevocably deposited with the Indenture
Trustee cash or direct obligations of or obligations guaranteed by the United
States of America (which will mature prior to the date such amounts are
payable), in trust for such purpose, in an amount sufficient to pay and
discharge the entire indebtedness on such Notes not theretofore delivered to the
Indenture Trustee for cancellation when due to the Note Final Maturity Date;
(b) the Issuer has paid or caused to be paid all other sums
payable hereunder by the Issuer; and
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(c) the Issuer has delivered to the Indenture Trustee an Officers'
Certificate of the Issuer, an Opinion of Counsel and (if required by the TIA or
the Indenture Trustee) an Independent Certificate from a firm of certified
public accountants, each meeting the applicable requirements of Section 11.1(a)
and, subject to Section 11.2, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
SECTION 4.2 Application of Trust Money. All moneys deposited
with the Indenture Trustee pursuant to Section 4.1 hereof shall be held in trust
and applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Noteholders of the particular Notes or
to any Swap Counterparty, as applicable, for the payment or redemption of which
such moneys have been deposited with the Indenture Trustee, of all sums due and
to become due thereon for principal and interest; but such moneys need not be
segregated from other funds except to the extent required herein or in the
Administration Agreement or required by law.
SECTION 4.3 Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all moneys then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Notes shall,
upon demand of the Issuer, be paid to the Indenture Trustee to be held and
applied according to Section 3.3 and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
SECTION 4.4 Auction of Trust Student Loans. Any Trust Student
Loans remaining in the Trust as of the end of the first Collection Period when
the Pool Balance is equal to 10% or less of the initial Pool Balance three
Business Days prior to such Distribution Date (the "Trust Auction Date") shall
be offered for sale by the Indenture Trustee unless the Servicer has exercised
its option to purchase the Trust Estate as described in Section 6.1(a) of the
Administration Agreement with respect to such Distribution Date. The Servicer
will be deemed to have waived such option if it fails to notify the Eligible
Lender Trustee and the Indenture Trustee of its exercise thereof in writing
prior to the Indenture Trustee's acceptance of a bid to purchase such Trust
Student Loans; provided, however, that there shall be no such offer for sale if
the Indenture Trustee fails to provide notice to the Servicer in accordance with
this Section 4.4. The Indenture Trustee shall provide written notice to the
Servicer of any such offer for sale at least 5 Business Days in advance of the
Trust Auction Date. The Indenture Trustee shall permit the Servicer or any of
its Affiliates including SLMA, SLM ELC and the Servicer to offer bids only if
the Pool Balance as of the applicable Trust Auction Date is equal to 10% or less
of the Initial Pool Balance and such bid does not exceed the fair market value
of the Trust Student Loans as of the Trust Auction Date. If at least two bids
are received, the Indenture Trustee shall solicit and resolicit new bids from
all participating bidders until only one bid remains or the remaining bidders
decline to resubmit bids. The Indenture Trustee shall accept the highest of such
remaining bids if it is equal to or in excess of both the Minimum Purchase
Amount and the fair market value of such Trust Student Loans as of the end of
the Collection Period immediately preceding the Trust Auction Date. If at least
two bids are not received or the highest bid after the resolicitation process is
completed is not equal to or in excess of the higher of the Minimum Purchase
Amount and the fair market value of the Trust Student Loans, the Indenture
Trustee
23
shall not consummate such sale. The Indenture Trustee may consult, and, at the
direction of the Depositor, shall consult, with a financial advisor, including
an Underwriter or Initial Purchaser of the Notes or the Administrator, to
determine if the fair market value of the Trust Student Loans has been offered.
The proceeds of any such sale will be paid at the time set forth in Section 2.6
of the Administration Agreement and applied in the order of priority set forth
in Section 5.4(b). If the sale is not consummated in accordance with the
foregoing, the Indenture Trustee may, but shall not be under any obligation to,
solicit bids for sale of the Trust Student Loans with respect to future
Distribution Dates upon terms similar to those described above, including the
Servicer's waiver of its option to purchase the Trust Estate in accordance with
Section 6.1(a) of the Administration Agreement with respect to each such future
Distribution Date.
ARTICLE V
Remedies
SECTION 5.1 Events of Default. "Event of Default," wherever
used herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) default in the payment of any interest on any Note
when the same becomes due and payable, and such default shall continue for a
period of five days; or
(ii) default in the payment of the principal of any Note
when the same becomes due and payable on the related Note Final Maturity Date;
or
(iii) default in the observance or performance of any
covenant or agreement of the Issuer made in this Indenture (other than a
covenant or agreement, a default in the observance or performance of which is
elsewhere in this Section specifically dealt with), or any representation or
warranty of the Issuer made in this Indenture or in any certificate or other
writing having been incorrect in any material respect as of the time when made,
such default or breach having a material adverse effect on the holders of the
Notes, and such default or breach shall continue or not be cured, or the
circumstance or condition in respect of which such misrepresentation or warranty
was incorrect shall not have been eliminated or otherwise cured, for a period of
30 days after there shall have been given, by registered or certified mail, to
the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee
by the Noteholders of at least 25% of the Outstanding Amount of the Notes, a
written notice specifying such default or incorrect representation or warranty
and requiring it to be remedied and stating that such notice is a notice of
Default hereunder; or
(iv) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any substantial
part of the Indenture Trust Estate in an involuntary case under any applicable
Federal or state bankruptcy, insolvency or other similar law now or hereafter in
effect, or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial part of
the Indenture Trust
24
Estate, or ordering the winding-up or liquidation of the Issuer's affairs, and
such decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or
(v) the commencement by the Issuer of a voluntary case
under any applicable Federal or state bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by the Issuer to the entry of an
order for relief in an involuntary case under any such law, or the consent by
the Issuer to the appointment or taking possession by a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the Issuer or
for any substantial part of the Indenture Trust Estate, or the making by the
Issuer of any general assignment for the benefit of creditors, or the failure by
the Issuer generally to pay its debts as such debts become due, or the taking of
action by the Issuer in furtherance of any of the foregoing.
SECTION 5.2 Acceleration of Maturity; Rescission and
Annulment. If an Event of Default should occur and be continuing, then and in
every such case the Indenture Trustee or the Noteholders representing at least a
majority of the Outstanding Amount of the Notes may declare all the Notes to be
immediately due and payable, by a notice in writing to the Issuer (and to the
Indenture Trustee if given by Noteholders), and upon any such declaration the
unpaid principal amount of such Notes, together with accrued and unpaid interest
thereon through the date of acceleration, shall become immediately due and
payable, subject, however, to Section 5.4 of this Indenture.
At any time after such declaration of acceleration of maturity
has been made and before a judgment or decree for payment of the money due has
been obtained by the Indenture Trustee as hereinafter in this Article V
provided, the Noteholders of Notes representing at least a majority of the
Outstanding Amount of the Notes, by written notice to the Issuer and the
Indenture Trustee, may rescind and annul such declaration and its consequences
if:
(i) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay:
(a) all payments of principal of and interest on
all Notes and all other amounts that would then be due
hereunder or upon such Notes if the Event of Default giving
rise to such acceleration had not occurred; and
(b) all sums paid or advanced by the Indenture
Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its
agents and counsel; and
(ii) all Events of Default, other than the nonpayment of
the principal of the Notes that has become due solely by such acceleration, have
been cured or waived as provided in Section 5.12.
No such rescission shall affect any subsequent default or
impair any right consequent thereto.
SECTION 5.3 Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee. The Issuer covenants that if (i) default is
made in the payment of any interest
25
on any Note when the same becomes due and payable, and such default continues
for a period of five days, or (ii) default is made in the payment of the
principal of any Note when the same becomes due and payable at the related Note
Final Maturity Date, the Issuer shall, upon demand of the Indenture Trustee, pay
to it, for the benefit of the Noteholders, the whole amount then due and payable
on such Notes for principal and interest, with interest upon the overdue
principal, and, to the extent payment at such rate of interest shall be legally
enforceable, upon overdue installments of interest, at the rate specified in
Section 2.7 and in addition thereto such further amount as shall be sufficient
to cover the costs and expenses of collection, including the reasonable
compensation, expenses, disbursements and advances of the Indenture Trustee and
its agents and counsel.
(a) In case the Issuer shall fail forthwith to pay such amounts
upon such demand, the Indenture Trustee, in its own name and as trustee of an
express trust, may institute a Proceeding for the collection of the sums so due
and unpaid, and may prosecute such Proceeding to judgment or final decree, and
may enforce the same against the Issuer or other obligor upon such Notes and
collect in the manner provided by law out of the property of the Issuer or other
obligor upon such Notes, wherever situated, the moneys adjudged or decreed to be
payable.
(b) If an Event of Default occurs and is continuing, the Indenture
Trustee may, as more particularly provided in Section 5.4, in its discretion,
proceed to protect and enforce its rights and the rights of the Noteholders and
any Currency Swap Counterparty by such appropriate Proceedings as the Indenture
Trustee shall deem most effective to protect and enforce any such rights,
whether for the specific enforcement of any covenant or agreement in this
Indenture or in aid of the exercise of any power granted herein, or to enforce
any other proper remedy or legal or equitable right vested in the Indenture
Trustee by this Indenture or by law.
(c) In case there shall be pending, relative to the Issuer or any
other obligor upon the Notes or any Person having or claiming an ownership
interest in the Indenture Trust Estate, Proceedings under Title 11 of the United
States Code or any other applicable Federal or state bankruptcy, insolvency or
other similar law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in case of any other, comparable judicial Proceedings
relative to the Issuer or other obligor upon the Notes, or to the creditors or
property of the Issuer or such other obligor, the Indenture Trustee,
irrespective of whether the principal of any Notes shall then be due and
payable, as therein expressed or by declaration or otherwise and irrespective of
whether the Indenture Trustee shall have made any demand pursuant to the
provisions of this Section, shall be entitled and empowered, by intervention in
such proceedings or otherwise:
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable in order to
have the claims of the Indenture Trustee (including any claim for reasonable
compensation to the Indenture Trustee and each predecessor Indenture Trustee,
and their respective agents, attorneys and counsel, and for reimbursement of all
expenses and liabilities incurred, and all advances made, by the Indenture
Trustee and each
26
predecessor Indenture Trustee, except as a result of negligence or bad faith)
and of the Noteholders allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations,
to vote on behalf of the Noteholders (and, if applicable, any Currency Swap
Counterparty) in any election of a trustee, a standby trustee or Person
performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts received
with respect to the claims of the Noteholders, any Currency Swap Counterparty
and the Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Indenture Trustee, any Currency Swap Counterparty or the Noteholders allowed in
any judicial proceedings relative to the Issuer, its creditors and its property;
and any trustee, receiver, liquidator, custodian or other
similar official in any such Proceeding is hereby authorized by each of such
Noteholders and any Currency Swap Counterparty to make payments to the Indenture
Trustee, and, in the event that the Indenture Trustee shall consent to the
making of payments directly to such Noteholders and any Currency Swap
Counterparty to pay to the Indenture Trustee such amounts as shall be sufficient
to cover reasonable compensation to the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents, attorneys and counsel, and all
other expenses and liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee except as a result of negligence
or bad faith.
(d) Nothing herein contained shall be deemed to authorize the
Indenture Trustee to authorize or consent to or vote for or accept or adopt on
behalf of any Noteholder any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Noteholder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
(e) All rights of action and of asserting claims under this
Indenture, or under any of the Notes, may be enforced by the Indenture Trustee
without the possession of any of the Notes or the production thereof in any
trial or other Proceedings relative thereto, and any such action or Proceedings
instituted by the Indenture Trustee shall be brought in its own name as trustee
of an express trust, and any recovery of judgment, subject to the payment of the
expenses, disbursements and compensation of the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents and attorneys, shall
be for the ratable benefit of the Noteholders, and after the Notes have been
paid in full, and subject to the provisions of Section 11.19, any Currency Swap
Counterparty.
(f) In any Proceedings brought by the Indenture Trustee (and also
any Proceedings involving the interpretation of any provision of this Indenture
to which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders and each
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Currency Swap Counterparty, and it shall not be necessary to make any Noteholder
or any Currency Swap Counterparty a party to any such Proceedings.
SECTION 5.4 Remedies; Priorities. If an Event of Default shall
have occurred and be continuing, the Indenture Trustee may do one or more of the
following (subject to Section 5.5):
(a) (i) institute Proceedings in its own name and as trustee
of an express trust for the collection of all amounts then payable on the Notes
or under this Indenture with respect thereto, whether by declaration or
otherwise, enforce any judgment obtained, and collect from the Issuer and any
other obligor upon such Notes moneys adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture, with respect to the Indenture
Trust Estate;
(iii) exercise any remedies of a secured party under the
UCC with respect to the Trust Estate and take any other appropriate action to
protect and enforce the rights and remedies of the Indenture Trustee, any
Currency Swap Counterparty and the Noteholders;
(iv) sell the Indenture Trust Estate or any portion
thereof or rights or interest therein, at one or more public or private sales
called and conducted in any manner permitted by law; and/or
(v) elect to have the Eligible Lender Trustee maintain
ownership of the Trust Student Loans and continue to apply collections with
respect to the Trust Student Loans as if there had been no declaration of
acceleration;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) with respect to the
Class A Notes, unless (A) the Noteholders of 100% of the Outstanding Amount of
the Class A Notes consent thereto, (B) the proceeds of such sale or liquidation
distributable to the Class A Noteholders are sufficient to discharge in full all
amounts then due and unpaid upon such Class A Notes for principal and interest
or (C) the Indenture Trustee determines that the Indenture Trust Estate will not
continue to provide sufficient funds for the payment of principal of and
interest on the Class A Notes as would have become due if the Class A Notes had
not been declared due and payable, and the Indenture Trustee obtains the consent
of Noteholders of 66-2/3% of the Outstanding Amount of the Class A Notes;
provided, further, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) with respect to the
Class A Notes, unless (D) the proceeds of such sale or liquidation distributable
to the Class B Noteholders plus the proceeds of the sale or liquidation of the
Trust Estate distributable to the Class B Noteholders are sufficient to pay to
the Class B Noteholders the Outstanding Amount of the Class B Notes plus accrued
and unpaid interest thereon or (E) after receipt of notice from the Eligible
Lender Trustee that the proceeds of such sale or liquidation distributable to
the Class B Noteholders plus the proceeds of the sale or liquidation of the
Trust Estate distributable to the Class B Noteholders would not be sufficient to
pay to the Class B Noteholders the outstanding principal plus accrued and unpaid
interest thereon, the Class
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B Noteholders of at least a majority of the Outstanding Amount of the Class B
Notes consent thereto. In determining such sufficiency or insufficiency with
respect to clauses (B), (C), (D) and (E), the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Indenture Trust Estate and/or Trust
Estate, as applicable, for such purpose.
(b) Notwithstanding the provisions of Section 8.2, following the
occurrence and during the continuation of an Event of Default specified in
Section 5.1(i), 5.1(ii), 5.1(iv) or 5.1(v) which has resulted in an acceleration
of the Notes, if the Indenture Trustee collects any money or property, it shall
pay out the money or property (and other amounts including amounts, if any, held
on deposit in each of the Trust Accounts) held as Collateral for the benefit of
the Noteholders, net of liquidation costs associated with the sale of the assets
of the Trust, in the following order:
FIRST:
A: to the applicable Noteholders of each class of Reset
Rate Notes then denominated in U.S. Dollars, bearing
interest at a fixed rate and not structured to
receive a payment of principal until the end of its
Reset Period, the amount, if any, on deposit in the
related Accumulation Account for such Reset Rate
Notes (excluding any Investment Earnings thereon) in
reduction of the Outstanding Amount of such Reset
Rate Notes until they are paid in full; and/or
B: to the related Currency Swap Counterparty if any
class of Reset Rate Notes is then in Foreign Exchange
Mode and not structured to receive a payment of
principal until the end of its Reset Period, the
amount, if any, on deposit in the related
Accumulation Account for such Reset Rate Notes
(excluding any Investment Earnings thereon) in
reduction of the Outstanding Amount of such Reset
Rate Notes until they are paid in full;
SECOND: to the Indenture Trustee for amounts due under
Section 6.7;
THIRD: to the Servicer for due and unpaid Primary
Servicing Fees;
FOURTH: to the Administrator, any due and unpaid
Administration Fees;
FIFTH: pro rata, based on amounts due and owing:
A: to the Class A Noteholders (other than the
noteholders of any class of Reset Rate Notes if a
Swap Agreement with respect to interest payments to
be made to such noteholders is then in effect), for
amounts due and unpaid on the Class A Notes for
interest at the applicable Note Rate, ratably,
without preference or priority of any kind, according
to the amounts due and payable on the Class A Notes
for such interest;
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B: if a Swap Agreement is then in effect for any class
of Reset Rate Noteholders with respect to interest
payments to be made to such noteholders, to each Swap
Counterparty, the amount of any Swap Interest
Payments due and payable by the Issuer (other than as
paid to that Swap Counterparty under clause FIRST);
and
C: if any Swap Agreement with respect to any class of
Reset Rate Notes has been terminated, to the related
Swap Counterparty, the amount of any Swap Termination
Payments due to such Swap Counterparty due to a
Termination Event (as defined in the related Swap
Agreement) resulting from a payment default under the
related Swap Agreement by the Issuer, a
non-rescindable, non-waivable acceleration of the
Notes, or the bankruptcy or insolvency of the Issuer.
SIXTH:
A: If any class of Reset Rate Notes is in Foreign
Exchange Mode, pro rata (1) to the Class A
Noteholders (other than the holders of any such class
of Reset Rate Notes then in Foreign Exchange Mode),
ratably, an amount sufficient to reduce the
respective principal balance of those Class A Notes
to zero, and (2) to the applicable Currency Swap
Counterparties an amount sufficient to reduce the
U.S. Dollar Equivalent Principal Amount of each class
of Reset Rate Notes then in Foreign Exchange Mode to
zero; or
B: if both classes of Reset Rate Notes are then
denominated in U.S. Dollars, pro rata to the Class A
Noteholders, ratably, an amount sufficient to reduce
the respective principal balance of those Class A
Notes to zero;
SEVENTH: to the Class B Noteholders for amounts due and
unpaid on the Class B Notes for interest at the Class B Note Rate;
EIGHTH: to the Class B Noteholders, an amount sufficient
to reduce the Outstanding Amount of the Class B Notes to zero;
NINTH: to the Servicer, for any unpaid Carryover
Servicing Fees;
TENTH: to any Swap Counterparties, pro rata, the amount
of any Swap Termination Payments due to such Swap Counterparties by the Issuer
and not payable in Clause FIFTH (C);
ELEVENTH: to the Remarketing Agents, any due and unpaid
Remarketing Fees payable by the Issuer to the extent not previously paid from
amounts on deposit in the Remarketing Fee Account;
TWELFTH: sequentially, first to the Remarketing Agents,
and second to the Administrator for any advances made on behalf of the Issuer,
in each case, for payment of certain
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costs and expenses as set forth in Section 3 of the Remarketing Agreement in
connection with the remarketing of any class of Reset Rate Notes not previously
reimbursed by the Issuer; and
THIRTEENTH: to the Excess Distribution Certificateholder,
any remaining funds.
If the Trust has entered into a Currency Swap Agreement and
such Currency Swap Agreement terminates, amounts that would have otherwise been
paid to the related Currency Swap Counterparty (other than amounts payable as a
Termination Payment thereunder) will be used to make payments to the related
class of Reset Rate Noteholders in an amount in the applicable non-U.S. Dollar
currency, equal to the payment that the related Currency Swap Counterparty would
have made. If this occurs, the Trust will exchange U.S. Dollars for the
applicable non-U.S. Dollar currency in order to make distributions on the
applicable class of Reset Rate Notes.
The Indenture Trustee may fix a record date and payment date
for any payment to Noteholders pursuant to this Section. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder and the
Issuer a notice that states the record date, the payment date and the amount to
be paid.
SECTION 5.5 Optional Preservation of the Trust Student Loans.
If the Notes have been declared to be due and payable under Section 5.2
following an Event of Default and such declaration and its consequences have not
been rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Indenture Trust Estate. It is the desire of the
parties hereto and the Noteholders that there be at all times sufficient funds
for the payment of principal of and interest on the Notes, and the Indenture
Trustee shall take such desire into account when determining whether or not to
maintain possession of the Indenture Trust Estate. In determining whether to
maintain possession of the Indenture Trust Estate, the Indenture Trustee may,
but need not, obtain and rely upon an opinion of an Independent investment
banking or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Indenture Trust Estate for such
purpose.
SECTION 5.6 Limitation of Suits. No Noteholder shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Noteholder has previously given written notice
to the Indenture Trustee of a continuing Event of Default;
(ii) the Noteholders of not less than 25% of the
Outstanding Amount of the Notes have made written request to the Indenture
Trustee to institute such Proceeding in respect of such Event of Default in its
own name as Indenture Trustee hereunder;
(iii) such Noteholder or Noteholders have offered to the
Indenture Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
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(iv) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to institute such
Proceeding; and
(v) no direction inconsistent with such written request
has been given to the Indenture Trustee during such 60-day period by the
Noteholders of at least a majority of the Outstanding Amount of the Notes;
it being understood and intended that no one or more
Noteholders shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this indenture to affect, disturb or prejudice the
rights of any other Noteholders or to obtain or to seek to obtain priority or
preference over any other Noteholders or to enforce any right under this
Indenture, except in the manner herein provided.
In the event the Indenture Trustee shall receive conflicting
or inconsistent requests and indemnity from two or more groups of Noteholders,
each representing less than a majority of the Outstanding Amount of the Notes,
the Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
SECTION 5.7 Unconditional Rights of Noteholders to Receive
Principal and Interest. Notwithstanding any other provisions in this Indenture,
each Noteholder shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest on its Note on or after the
respective due dates thereof expressed in such Note or in this Indenture (or, in
the case of redemption, on or after the Redemption Date) and to institute suit
for the enforcement of any such payment, and such right shall not be impaired
without the consent of such Noteholder.
SECTION 5.8 Restoration of Rights and Remedies. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any
right or remedy under this Indenture and such Proceeding has been discontinued
or abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had been
instituted.
SECTION 5.9 Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee, any Swap
Counterparty or to the Noteholders is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 5.10 Delay or Omission Not a Waiver. No delay or
omission of the Indenture Trustee, any Swap Counterparty or any Noteholder to
exercise any right or remedy accruing upon any Default shall impair any such
right or remedy or constitute a waiver of any
32
such Default or an acquiescence therein. Every right and remedy given by this
Article V or by law to the Indenture Trustee, any Swap Counterparty or to the
Noteholders may be exercised from time to time, and as often as may be deemed
expedient, by the Indenture Trustee, any Swap Counterparty or by the
Noteholders, as the case may be.
SECTION 5.11 Control by Noteholders. The Noteholders of at
least a majority of the Outstanding Amount of the Notes shall have the right to
direct the time, method and place of conducting any Proceeding for any remedy
available to the Indenture Trustee with respect to the Notes or exercising any
trust or power conferred on the Indenture Trustee; provided that
(i) such direction shall not be in conflict with any rule
of law or with this Indenture;
(ii) subject to the express terms of Section 5.4, any
direction to the Indenture Trustee to sell or liquidate the Indenture Trust
Estate shall be by the Noteholders of not less than 100% of the Outstanding
Amount of the Notes;
(iii) if the conditions set forth in Section 5.5 have been
satisfied and the Indenture Trustee elects to retain the Indenture Trust Estate
pursuant to such Section, then any direction to the Indenture Trustee by
Noteholders of less than 100% of the Outstanding Amount of the Notes to sell or
liquidate the Indenture Trust Estate shall be of no force and effect; and
(iv) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee that is not inconsistent with such
direction;
provided, however, that, subject to Section 6.1, the Indenture Trustee need not
take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
SECTION 5.12 Waiver of Past Defaults. Prior to the time a
judgment or decree for payment of money due has been obtained as described in
Section 5.2, the Noteholders of at least a majority of the Outstanding Amount of
the Notes may waive any past Default and its consequences except a Default (a)
in payment when due of principal of or interest on any of the Notes or (b) in
respect of a covenant or provision hereof which cannot be modified or amended
without the consent of each Noteholder. In the case of any such waiver, the
Issuer, the Indenture Trustee and the Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereto.
SECTION 5.13 Undertaking for Costs. All parties to this
Indenture agree, and each Noteholder by such Noteholder's acceptance of any Note
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Indenture Trustee for any action taken, suffered or omitted
by it as Indenture Trustee, the filing by any party litigant in such suit of an
33
undertaking to pay the costs of such suit, and that such court may in its
discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section shall not apply to (a) any suit instituted by the
Indenture Trustee, (b) any suit instituted by any Noteholder, or group of
Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Amount of the Notes or (c) any suit Instituted by any Noteholder for
the enforcement of the payment of principal of or interest on any Note on or
after the respective due dates expressed in such Note and in this Indenture (or,
in the case of redemption, on or after the Redemption Date).
SECTION 5.14 Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead or in any manner whatsoever, claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance of
this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
SECTION 5.15 Action on Notes. The Indenture Trustee's right to
seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be impaired
by the recovery of any judgment by the Indenture Trustee against the Issuer or
by the levy of any execution under such judgment upon any portion of the
Indenture Trust Estate or upon any of the assets of the Issuer. Any money or
property collected by the Indenture Trustee shall be applied in accordance with
Section 5.4(b).
SECTION 5.16 Performance and Enforcement of Certain
Obligations.
(a) Promptly following a request from the Indenture Trustee to do
so and at the Administrator's expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the performance
and observance by the Depositor, SLMA, SLM ELC, the Administrator and the
Servicer, as applicable, of each of their obligations to the Issuer, whether
directly or by assignment, under or in connection with the Sale Agreement, the
SLMA Purchase Agreement, the SLM ELC Purchase Agreement, the Administration
Agreement and the Servicing Agreement, respectively, in accordance with the
terms thereof, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the Sale
Agreement, the SLMA Purchase Agreement, the SLM ELC Purchase Agreement, the
Administration Agreement and the Servicing Agreement, as the case may be, to the
extent and in the manner directed by the Indenture Trustee, including the
transmission of notices of default on the part of the Depositor, SLMA, SLM ELC,
the Administrator or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Depositor, SLMA, SLM ELC, the Administrator or the Servicer of each of their
obligations under the Sale Agreement, the SLMA Purchase Agreement, the SLM ELC
Purchase Agreement, the Administration Agreement and the Servicing Agreement,
respectively.
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(b) If an Event of Default has occurred and is continuing, the
Indenture Trustee may, and at the written direction of the Noteholders of
66-2/3% of the Outstanding Amount of the Notes shall, exercise all rights,
remedies, powers, privileges and claims of the Issuer against the Depositor,
SLMA, SLM ELC, the Administrator or the Servicer under or in connection with the
Sale Agreement, the SLMA Purchase Agreement, the SLM ELC Purchase Agreement, the
Administration Agreement and the Servicing Agreement, respectively, including
the right or power to take any action to compel or secure performance or
observance by the Depositor, SLMA, SLM ELC, the Administrator or the Servicer of
each of their obligations to the Issuer thereunder, whether directly or by
assignment, and to give any consent, request, notice, direction, approval,
extension or waiver under the Sale Agreement, the SLMA Purchase Agreement, the
SLM ELC Purchase Agreement, the Administration Agreement and the Servicing
Agreement, respectively, and any right of the Issuer to take such action shall
be suspended.
ARTICLE VI
The Indenture Trustee
SECTION 6.1 Duties of Indenture Trustee. (a) If an Event of
Default has occurred and is continuing, the Indenture Trustee shall exercise the
rights and powers vested in it by this Indenture and use the same degree of care
and skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this Indenture and
no implied covenants or obligations shall be read into this Indenture against
the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or opinions
furnished to the Indenture Trustee and conforming to the requirements of this
Indenture; provided, however, that the Indenture Trustee shall examine the
certificates and opinions to determine whether or not they conform to the
requirements of this Indenture.
(c) The Indenture Trustee may not be relieved from liability for
its own negligent action, its own negligent failure to act or its own willful
misconduct, except that:
(i) this paragraph does not limit the effect of paragraph
(b) of this Section;
(ii) the Indenture Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer unless it is
proved that the Indenture Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Indenture Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in accordance with
a direction received by it pursuant to Section 5.11.
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(d) The Indenture Trustee shall not be liable for interest on any
money received by it except as the Indenture Trustee may agree in writing with
the Issuer.
(e) Money held in trust by the Indenture Trustee need not be
segregated from other funds except to the extent required by law or the terms of
this Indenture or the other Basic Documents.
(f) No provision of this Indenture shall require the Indenture
Trustee to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder or in the exercise of any of
its rights or powers, if it shall have reasonable grounds to believe that
repayments of such funds or adequate indemnity satisfactory to it against any
loss, liability or expense is not reasonably assured to it.
(g) Except as expressly provided in the Basic Documents, the
Indenture Trustee shall have no obligation to administer, service or collect the
Trust Student Loans or to maintain, monitor or otherwise supervise the
administration, servicing or collection of the Trust Student Loans.
(h) In the event that the Indenture Trustee is the Paying Agent or
the Note Registrar, the rights and protections afforded to the Indenture Trustee
pursuant to this Indenture shall also be afforded to the Indenture Trustee in
its capacity as Paying Agent or Note Registrar.
(i) Every provision of this Indenture relating to the conduct or
affecting the liability of or affording protection to the Indenture Trustee
shall be subject to the provisions of this Section and to the provisions of the
TIA.
SECTION 6.2 Rights of Indenture Trustee. (a) The Indenture
Trustee may rely on any document believed by it to be genuine and to have been
signed or presented by the proper Person. The Indenture Trustee need not
investigate any fact or matter stated in such document.
(b) Before the Indenture Trustee acts or refrains from acting, it
may require and shall be entitled to receive an Officers' Certificate of the
Issuer and/or an Opinion of Counsel. The Indenture Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on such
Officers' Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian or nominee, and the Indenture Trustee shall
not be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such agent, attorney, custodian or nominee appointed with
due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any action it
takes or omits to take in good faith which it believes to be authorized or
within its rights or powers; provided, however, that the Indenture Trustee's
conduct does not constitute willful misconduct, negligence or bad faith.
(e) The Indenture Trustee may consult with counsel, and the advice
or opinion of counsel with respect to legal matters relating to this Indenture
and the Notes shall be full and
36
complete authorization and protection from liability in respect to any action
taken, omitted or suffered by it hereunder in good faith and in accordance with
the advice or opinion of such counsel.
SECTION 6.3 Individual Rights of Indenture Trustee. The
Indenture Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Issuer or its Affiliates
with the same rights it would have if it were not Indenture Trustee. Any Paying
Agent, Note Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Indenture Trustee must comply with Sections 6.11 and 6.12.
SECTION 6.4 Indenture Trustee's Disclaimer. The Indenture
Trustee shall not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, it shall not be accountable
for the Issuer's use of the proceeds from the Notes, and it shall not be
responsible for any statement of the Issuer in the Indenture or in any document
issued in connection with the sale of the Notes or in the Notes other than the
Indenture Trustee's certificate of authentication.
SECTION 6.5 Notice of Defaults. If a Default occurs and is
continuing and if it is either actually known or written notice of the existence
thereof has been delivered to a Responsible Officer of the Indenture Trustee,
the Indenture Trustee shall mail notice of the Default to each Noteholder and
any Swap Counterparty within 90 days and to each Rating Agency as soon as
practicable within 30 days after it occurs. Except in the case of a Default in
payment of principal of or interest on any Note (including payments pursuant to
the mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interests of
Noteholders and any Swap Counterparty. Except as provided in the first sentence
of this Section 6.5, in no event shall the Indenture Trustee be deemed to have
knowledge of a Default or an Event of Default.
SECTION 6.6 Reports by Indenture Trustee to Noteholders. The
Indenture Trustee shall deliver to each Noteholder (and to each Person who was a
Noteholder at any time during the applicable calendar year) such information as
may be required to enable such holder to prepare its Federal and state income
tax returns. Within 60 days after each December 31 beginning with the December
31 following the date of this Indenture, the Indenture Trustee shall mail to
each Noteholder a brief report as of such December 31 that complies with TIA
Section 313(a) if required by said section. The Indenture Trustee shall also
comply with TIA Section 313(b). A copy of each such report required pursuant to
TIA Section 313(a) or (b) shall, at the time of such transaction to Noteholders,
be filed by the Indenture Trustee with the Commission and with each securities
exchange, if any, upon which the Notes are listed, provided that the Issuer has
previously notified the Indenture Trustee of such listing.
SECTION 6.7 Compensation and Indemnity. The Issuer shall cause
the Depositor to pay to the Indenture Trustee reasonable compensation for its
services in accordance with a separate agreement between the Depositor and the
Indenture Trustee and shall cause the Depositor to reimburse the Indenture
Trustee for all reasonable out-of-pocket expenses incurred or made by it as
provided in such separate agreement. The Indenture Trustee's compensation
37
shall not be limited by any law on compensation of a trustee of an express
trust. The Issuer shall cause the Administrator to indemnify the Indenture
Trustee and its directors, officers, employees and agents against any and all
loss, liability or expense (including attorneys' fees) incurred by it in
connection with the administration of this trust and the performance of its
duties hereunder and under the other Basic Documents. The Indenture Trustee
shall notify the Issuer and the Administrator promptly of any claim for which it
may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and
the Administrator shall not relieve the Issuer or the Administrator of its
obligations hereunder and under the other Basic Documents. The Issuer shall
cause the Administrator to defend the claim and the Administrator shall not be
liable for the legal fees and expenses of the Indenture Trustee after it has
assumed such defense; provided, however, that, in the event that there may be a
conflict between the positions of the Indenture Trustee and the Administrator in
conducting the defense of such claim, the Indenture Trustee shall be entitled to
separate counsel acceptable to it in its sole discretion the reasonable fees and
expenses of which shall be paid by the Administrator on behalf of the Issuer.
Neither the Issuer nor the Administrator need reimburse any expense or indemnify
against any loss, liability or expense incurred by the Indenture Trustee through
the Indenture Trustee's own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee
pursuant to this Section shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses after the occurrence of a Default specified in
Section 5.1(iv) or (v) with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable Federal or state bankruptcy, insolvency or similar law.
SECTION 6.8 Replacement of Indenture Trustee. No resignation
or removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.8. The Indenture Trustee
may resign at any time by so notifying the Issuer. The Noteholders of at least a
majority in Outstanding Amount of the Notes may remove the Indenture Trustee by
so notifying the Indenture Trustee and may appoint a successor Indenture
Trustee. The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section
6.11;
(ii) an Insolvency Event occurs with respect to the
Indenture Trustee;
(iii) a receiver or other public officer takes charge of
the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of
acting.
If the Indenture Trustee resigns or is removed or if a vacancy
exists in the office of Indenture Trustee for any reason (the Indenture Trustee
in such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee and to the
Issuer. Thereupon the resignation or
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removal of the retiring Indenture Trustee shall become effective, and the
successor Indenture Trustee shall have all the rights, powers and duties of the
Indenture Trustee under this Indenture. The successor Indenture Trustee shall
mail a notice of its succession to Noteholders. The retiring Indenture Trustee
shall promptly transfer all property held by it as Indenture Trustee to the
successor Indenture Trustee.
If a successor Indenture Trustee does not take office within
60 days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Noteholders of at least a majority in
Outstanding Amount of the Notes may petition any court of competent jurisdiction
for the appointment of a successor Indenture Trustee. The successor Indenture
Trustee shall give notice of its appointment as successor Indenture Trustee to
the Rating Agencies.
If the Indenture Trustee fails to comply with Section 6.11,
any Noteholder may petition any court of competent jurisdiction for the removal
of the Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section, the Issuer's and the Administrator's obligations under
Section 6.7 shall continue for the benefit of the retiring Indenture Trustee.
SECTION 6.9 Successor Indenture Trustee by Merger. If the
Indenture Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Indenture Trustee,
provided that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. The Indenture Trustee shall provide
the Rating Agencies prior written notice of any such transaction.
In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
SECTION 6.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this
Indenture, at any time, for the purpose of meeting any legal requirement of any
jurisdiction in which any part of the Indenture Trust Estate may at the time be
located, the Indenture Trustee shall have the power and may execute and deliver
all instruments to appoint one or more Persons to act as a co-trustee or
co-trustees, or separate trustee or separate trustees, of all or any part of the
Indenture Trust Estate, and to vest in such Person or Persons, in such capacity
and for the benefit of the Noteholders,
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such title to the Indenture Trust Estate, or any part hereof, and, subject to
the other provisions of this Section, such powers, duties, obligations, rights
and trusts as the Indenture Trustee may consider necessary or desirable. No such
appointment shall relieve the Indenture Trustee of its obligations hereunder. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 6.11 and no notice to
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.8 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred
or imposed upon the Indenture Trustee shall be conferred or imposed upon and
exercised or performed by the Indenture Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or co-trustee
is not authorized to act separately without the Indenture Trustee joining in
such act), except to the extent that under any law of any jurisdiction in which
any particular act or acts are to be performed the Indenture Trustee shall be
incompetent or unqualified to perform such act or acts, in which event such
rights, powers, duties and obligations (including the holding of title to the
Indenture Trust Estate or any portion thereof in any such jurisdiction) shall be
exercised and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Indenture
Trustee shall be deemed to have been given to each of the then separate trustees
and co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Indenture and
the conditions of this Article VI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording
protection to, the Indenture Trustee. Every such instrument shall be filed with
the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute
the Indenture Trustee, its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Indenture on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
of its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Indenture Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
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SECTION 6.11 Eligibility; Disqualification. The Indenture
Trustee shall at all times satisfy the requirements of TIA Section 310(a), the
requirements of an "eligible lender" under 20 USC Section 1085(d) and the
requirements of Rule 3a-7(4)(i) of the General Rules and Regulations under the
Investment Company Act of 1940, as amended. The Indenture Trustee shall have a
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition and it shall have a long-term senior
unsecured debt rating of not less than investment grade by each of the Rating
Agencies. The Indenture Trustee shall comply with TIA Section 310(b), including
the optional provision permitted by the second sentence of TIA Section
310(b)(9); provided, however, that there shall be excluded from the operation of
TIA Section 310(b)(1) any indenture or indentures under which other securities
of the Issuer are outstanding if the requirements for such exclusion set forth
in TIA Section 310(b)(1) are met.
SECTION 6.12 Preferential Collection of Claims Against the
Issuer. The Indenture Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). An Indenture Trustee who
has resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated.
ARTICLE VII
Noteholders' Lists and Reports
SECTION 7.1 Issuer to Furnish Indenture Trustee Names and
Addresses of Noteholders. The Issuer will furnish or cause to be furnished to
the Indenture Trustee (a) not more than five days after the earlier of (i) each
Record Date and (ii) three months after the last Record Date, a list, in such
form as the Indenture Trustee may reasonably require, of the names and addresses
of the Noteholders as of such Record Date, (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.
SECTION 7.2 Preservation of Information; Communications to
Noteholders. The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Noteholders contained in
the most recent list furnished to the Indenture Trustee as provided in Section
7.1 and the names and addresses of Noteholders received by the Indenture Trustee
in its capacity as Note Registrar. The Indenture Trustee may destroy any list
furnished to it as provided in such Section 7.1 upon receipt of a new list so
furnished.
(a) Noteholders may communicate pursuant to TIA Section 312(b)
with other Noteholders with respect to their rights under this Indenture or
under the Notes. Upon receipt by the Indenture Trustee of any request by three
or more Noteholders or by one or more holders of Notes evidencing not less than
25% of the Outstanding Amount of the Notes to receive a copy of the current list
of Noteholders (whether or not made pursuant to TIA Section 312(b)), the
Indenture Trustee shall promptly notify the Administrator thereof by providing
to the Administrator a copy of such request and a copy of the list of
Noteholders produced in response thereto.
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(b) The Issuer, the Indenture Trustee and the Note Registrar shall
have the protection of TIA Section 312(c).
(c) On each Distribution Date the Indenture Trustee shall provide
to each Noteholder of record as of the related Record Date the information
provided by the Administrator to the Indenture Trustee on the related
Determination Date pursuant to Section 2.11 of the Administration Agreement.
(d) The Indenture Trustee shall furnish to the Noteholders
promptly upon receipt of a written request therefor, duplicates or copies of all
reports, notices, requests, demands, certificates, financial statements and any
other instruments furnished to the Indenture Trustee under the Basic Documents.
The Indenture Trustee shall furnish to the Noteholders promptly upon receipt
thereof from the Eligible Lender Trustee notice of any amendment of the
Administration Agreement pursuant to Section 8.5 of the Administration
Agreement.
SECTION 7.3 Reports by Issuer.
(a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after
the Issuer is required to file the same with the Commission, copies of the
annual reports and of the information, documents and other reports (or copies of
such portions of any of the foregoing as the Commission may from time to time by
rules and regulations prescribe) which the Issuer may be required to file with
the Commission pursuant to Section 13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by the
Commission such additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this Indenture as
may be required from time to time by such rules and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders described in TIA Section
313(c)) such summaries of any information, documents and reports required to be
filed by the Issuer pursuant to clauses (i) and (ii) of this Section 7.3(a) as
may be required by rules and regulations prescribed from time to time by the
Commission.
(b) Unless the Issuer otherwise determines, the fiscal year of the
Issuer shall end on December 31 of each year.
ARTICLE VIII
Accounts, Disbursements and Releases
SECTION 8.1 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this
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Indenture. The Indenture Trustee shall apply all such money received by it on
behalf of Noteholders and any Swap Counterparty pursuant to the Administration
Agreement as provided in this Indenture. Except as otherwise expressly provided
in this Indenture, if any default occurs in the making of any payment or
performance under any agreement or instrument that is part of the Indenture
Trust Estate, the Indenture Trustee may take such action as may be appropriate
to enforce such payment or performance, including the institution and
prosecution of appropriate Proceedings. Any such action shall be without
prejudice to any right to claim a Default under this Indenture and any right to
proceed thereafter as provided in Article V.
SECTION 8.2 Trust Accounts. (a) On or prior to the Closing
Date, the Issuer shall cause the Administrator to establish and maintain, in the
name of the Indenture Trustee, for the benefit of the Noteholders and any Swap
Counterparty the Trust Accounts as provided in Section 2.3 of the Administration
Agreement.
(b) On or before the Business Day immediately preceding each
Distribution Date, all Available Funds and amounts set forth in paragraph (a)(2)
of the definition of Available Funds with respect to the preceding Collection
Period will be deposited in the Collection Account as provided in Section 2.4 of
the Administration Agreement. On or before each Distribution Date, the Indenture
Trustee (or any other Paying Agent) shall make the required deposits and
distributions as provided in Sections 2.7 and 2.8 of the Administration
Agreement.
SECTION 8.3 General Provisions Regarding Accounts. (a) So long
as no Default shall have occurred and be continuing, all or a portion of the
funds in the Trust Accounts shall be invested in Eligible Investments and
reinvested by the Indenture Trustee upon Issuer Order, subject to the provisions
of Section 2.3(b) of the Administration Agreement. All income or other gain from
investments of moneys deposited in the Trust Accounts shall be deposited by the
Indenture Trustee in the Collection Account, and any loss resulting from such
investments shall be charged to such Trust Account. The Issuer will not direct
the Indenture Trustee to make any investment of any funds or to sell any
investment held in any of the Trust Accounts unless the security interest
granted and perfected in such account will continue to be perfected in such
investment or the proceeds of such sale, in either case without any further
action by any Person, and, in connection with any direction to the Indenture
Trustee to make any such investment or sale, if requested by the Indenture
Trustee, the Issuer shall deliver to the Indenture Trustee an Opinion of
Counsel, acceptable to the Indenture Trustee, to such effect.
(b) Subject to Section 6.1(c), the Indenture Trustee shall not in
any way be held liable for the selection of Eligible Investments or by reason of
any insufficiency in any of the Trust Accounts resulting from any loss on any
Eligible Investment included therein except for losses attributable to the
Indenture Trustee's failure to make payments on such Eligible Investments issued
by the Indenture Trustee, in its commercial capacity as principal obligor and
not as trustee, in accordance with their terms.
(c) If (i) the Issuer shall have failed to give investment
directions for any funds on deposit in the Trust Accounts to the Indenture
Trustee by 10:00 a.m. Eastern Time (or such other time as may be agreed by the
Issuer and Indenture Trustee) on any Business Day; or (ii) a Default shall have
occurred and be continuing with respect to the Notes but the Notes shall not
have been declared due and payable pursuant to Section 5.2, or, if such Notes
shall have been
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declared due and payable following an Event of Default, amounts collected or
receivable from the Indenture Trust Estate are being applied in accordance with
Section 5.5 as if there had not been such a declaration; then the Indenture
Trustee shall invest and reinvest funds in the Trust Accounts in the Eligible
Investments described in clause (d) of the definition thereof.
SECTION 8.4 Release of Indenture Trust Estate. (a) Subject to
the payment of its fees and expenses pursuant to Section 6.7, the Indenture
Trustee may, and when required by the provisions of this Indenture shall,
execute instruments to release property from the lien of this Indenture, or
convey the Indenture Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this Indenture.
No party relying upon an instrument executed by the Indenture Trustee as
provided in this Article VIII shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there are no
Notes Outstanding and all sums due the Indenture Trustee pursuant to Section 6.7
have been paid, subject to the interest therein of any Swap Counterparty,
release any remaining portion of the Indenture Trust Estate that secured the
Notes from the lien of this Indenture and release to the Issuer or any other
Person entitled thereto any funds then on deposit in the Trust Accounts. The
Indenture Trustee shall release property from the lien of this Indenture
pursuant to this Section 8.4(b) only upon receipt of an Issuer Request
accompanied by an Officers' Certificate of the Issuer, an Opinion of Counsel and
(if required by the TIA) Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.1.
(c) Each Noteholder, by the acceptance of a Note, acknowledges
that from time to time the Indenture Trustee shall release the lien of this
Indenture on any Trust Student Loan to be sold to (i) the Depositor in
accordance with Section 6 of the Sale Agreement, (ii) to the Servicer in
accordance with Section 3.5 of the Servicing Agreement, (iii) to SLMA in
accordance with Section 6 of the SLMA Purchase Agreement, and (iv) to SLM ELC in
accordance with Section 6 of the SLM ELC Purchase Agreement, and each
Noteholder, by the acceptance of a Note, consents to any such release.
SECTION 8.5 Opinion of Counsel. The Indenture Trustee shall
receive at least seven days' notice when requested by the Issuer to take any
action pursuant to Section 8.4(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.4(c), as a condition to such action,
an Opinion of Counsel, in form and substance satisfactory to the Indenture
Trustee, stating the legal effect of any such action, outlining the steps
required to complete the same, and concluding that all conditions precedent to
the taking of such action have been complied with and such action will not
materially and adversely impair the security for the Notes or the rights of the
Noteholders or any Swap Counterparty in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall not be required
to express an opinion as to the fair value of the Indenture Trust Estate.
Counsel rendering any such opinion may rely, without independent investigation,
on the accuracy and validity of any certificate or other instrument delivered to
the Indenture Trustee in connection with any such action.
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ARTICLE IX
Supplemental Indentures
SECTION 9.1 Supplemental Indentures Without Consent of Noteholders.
(a) Without the consent of any Noteholders but with prior notice
to the Rating Agencies, the Issuer and the Indenture Trustee, when authorized by
an Issuer Order, at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as in force at the date of the execution thereof), in form
satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property
at any time subject to the lien of this Indenture, or better to assure, convey
and confirm unto the Indenture Trustee any property subject or required to be
subjected to the lien of this Indenture, or to subject to the lien of this
Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein and in
the Notes contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Noteholders and, any Swap Counterparty, as applicable, or to
surrender any right or power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be inconsistent with
any other provision herein or in any supplemental indenture or to make any other
provisions with respect to matters or questions arising under this Indenture or
in any supplemental indenture; provided that such action shall not materially
adversely affect the interests of the Noteholders or any Swap Counterparty;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes and to
add to or change any of the provisions of this Indenture as shall be necessary
to facilitate the administration of the trusts hereunder by more than one
trustee, pursuant to the requirements of Article VI; or
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the qualification of
this Indenture under the TIA or under any similar Federal statute hereafter
enacted and to add to this Indenture such other provisions as may be expressly
required by the TIA.
The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
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(b) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, may, also without the consent of any of the Noteholders but with
prior notice to any Swap Counterparty and the Rating Agencies, enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Noteholders
or any Swap Counterparty under this Indenture; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder or any Swap Counterparty.
SECTION 9.2 Supplemental Indentures with Consent of
Noteholders.
(a) The Issuer and the Indenture Trustee, when authorized by an
Issuer Order, also may, with prior notice to any Swap Counterparty and the
Rating Agencies and with the consent of the Noteholders of at least a majority
of the Outstanding Amount of the Notes, by Act of such Noteholders delivered to
the Issuer and the Indenture Trustee, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Noteholder of each Outstanding Note affected thereby:
(i) change the date of payment of any installment of
principal of or interest on any Note, or reduce the principal amount thereof,
the interest rate thereon or the Redemption Price with respect thereto, change
the provisions of this Indenture relating to the application of collections on,
or the proceeds of the sale of, the Indenture Trust Estate to payment of
principal of or interest on the Notes, or change any place of payment where, or
the coin or currency in which, any Note or the interest thereon is payable
(other than pursuant to the terms and conditions of the Reset Rate Notes or
pursuant to the Reset Rate Note Procedures set forth in Appendix A-2 to this
Indenture) or impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds available
therefor, as provided in Article V, to the payment of any such amount due on the
Notes on or after the respective due dates thereof (or, in the case of
redemption, on or after the Redemption Date);
(ii) reduce the percentage of the Outstanding Amount of the Notes,
the consent of the Noteholders of which is required for any such supplemental
indenture, or the consent of the Noteholders of which is required for any waiver
of compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences provided for in this Indenture;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of the Notes
required to direct the Indenture Trustee to direct the Issuer to sell or
liquidate the Indenture Trust Estate pursuant to Section 5.4;
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(v) modify any provision of this Section except to increase any
percentage specified herein or to provide that certain additional provisions of
this Indenture or the other Basic Documents cannot be modified or waived without
the consent of the Noteholder of each Outstanding Note affected thereby;
(vi) modify any of the provisions of this Indenture in such manner
as to affect the calculation of the amount of any payment of interest or
principal due on any Note on any Distribution Date (including the calculation of
any of the individual components of such calculation) or to affect the rights of
the Noteholders to the benefit of any provisions for the mandatory redemption of
the Notes contained herein; or
(vii) permit the creation of any lien ranking prior to or on a
parity with the lien of this Indenture with respect to any part of the Indenture
Trust Estate or, except as otherwise permitted or contemplated herein, terminate
the lien of this Indenture on any property at any time subject hereto or deprive
any Noteholder of any Note of the security provided by the lien of this
Indenture;
provided, however, that such action shall not, as evidenced by an Opinion of
Counsel, adversely affect in any material respect the interests of any Swap
Counterparty.
It shall not be necessary for any Act of Noteholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section, the Indenture
Trustee shall mail to the Noteholders of the Notes to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Indenture Trustee
to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
SECTION 9.3 Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Indenture Trustee shall be entitled to
receive, and subject to Sections 6.1 and 6.2, shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise.
SECTION 9.4 Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Noteholders shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and
47
amendments, and all the terms and conditions of any such supplemental indenture
shall be and be deemed to be part of the terms and conditions of this Indenture
for any and all purposes.
SECTION 9.5 Conformity with Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article IX shall conform to the requirements of the Trust Indenture Act
as then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.
SECTION 9.6 Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as to
any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
Redemption of Notes
SECTION 10.1 Redemption. The Indenture Trustee shall, upon
receipt of written notice from the Servicer pursuant to Section 6.1(b) of the
Administration Agreement, give prompt written notice to the Noteholders of the
occurrence of such event. In the event that the assets of the Trust are sold
pursuant to Section 6.1(a) of the Administration Agreement, that portion of the
amounts on deposit in the Trust Accounts to be distributed to the Noteholders
shall be paid to the Noteholders as provided in Sections 2.7 and 2.8. If amounts
are to be paid to Noteholders pursuant to this Section 10.1, the notice of such
event from the Indenture Trustee to the Noteholders shall include notice of the
redemption of Notes by application of such amounts on the next Distribution Date
which is not sooner than 15 days after the date of such notice (the "Redemption
Date"), whereupon all such amounts shall be payable on the Redemption Date.
SECTION 10.2 Form of Redemption Notice. Notice of redemption
under Section 10.1 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, or by facsimile, mailed or transmitted on or prior to the
applicable Redemption Date to each Noteholder, as of the close of business on
the Record Date preceding the applicable Redemption Date, at such Noteholder's
address or facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or agency of the
Issuer to be maintained as provided in Section 3.2).
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Notice of redemption of the Notes shall be given by the
Indenture Trustee in the name and at the expense of the Issuer. Failure to give
notice of redemption, or any defect therein, to any Noteholder of any Note shall
not impair or affect the validity of the redemption of any other Note.
SECTION 10.3 Notes Payable on Redemption Date. The Notes or
portions thereof to be redeemed shall on the Redemption Date become due and
payable at the Redemption Price and (unless the Issuer shall default in the
payment of the Redemption Price) no interest shall accrue on the Redemption
Price for any period after the date to which accrued interest is calculated for
purposes of calculating the Redemption Price.
ARTICLE XI
Miscellaneous
SECTION 11.1 Compliance Certificates and Opinions, etc. (a)
Upon any application or request by the Issuer to the Indenture Trustee to take
any action under any provision of this Indenture, the Issuer shall furnish to
the Indenture Trustee and the Rating Agencies (i) an Officers' Certificate of
the Issuer stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with and (iii) (if required by
the TIA) an Independent Certificate from a firm of certified public accountants
meeting the applicable requirements of this Section, except that, in the case of
any such application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this indenture shall include:
(i) a statement that each signatory of such certificate
or opinion has read or has caused to be read such covenant or condition and the
definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions contained in
such certificate or opinion are based;
(iii) a statement that, in the opinion of each such
signatory, such signatory has made such examination or investigation as is
necessary to enable such signatory to express an informed opinion as to whether
or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each
such signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other property
or securities with the Indenture Trustee that is to be made the basis for the
release of any property or securities subject to the lien of this Indenture, the
Issuer shall, in addition to any obligation imposed in
49
Section 11.1(a) or elsewhere in this Indenture, furnish to the Indenture Trustee
and the Rating Agencies an Officers' Certificate of the Issuer certifying or
stating the opinion of each person signing such certificate as to the fair value
(within 90 days of such deposit) to the Issuer of the Collateral or other
property or securities to be so deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee and the Rating Agencies an Officers' Certificate of the Issuer
certifying or stating the opinion of any signer thereof as to the matters
described in clause (i) above, the Issuer shall also deliver to the Indenture
Trustee an Independent Certificate as to the same matters, if the fair value to
the Issuer of the securities to be so deposited and of all other such securities
made the basis of any such withdrawal or release since the commencement of the
then-current fiscal year of the Issuer, as set forth in the certificates
delivered pursuant to clause (i) above and this clause (ii), is 10% or more of
the Outstanding Amount of the Notes, but such a certificate need not be
furnished with respect to any securities so deposited, if the fair value thereof
to the Issuer as set forth in the related Officers' Certificate is less than
$25,000 or less than one percent of the Outstanding Amount of the Notes.
(iii) Other than any property released as contemplated by
clause (v) below, whenever any property or securities are to be released from
the lien of this Indenture, the Issuer shall also furnish to the Indenture
Trustee an Officers' Certificate of the Issuer certifying or stating the opinion
of each person signing such certificate as to the fair value (within 90 days of
such release) of the property or securities proposed to be released and stating
that in the opinion of such person the proposed release will not impair the
security under this Indenture in contravention of the provisions hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officers' Certificate of the Issuer certifying or stating
the opinion of any signer thereof as to the matters described in clause (iii)
above, the Issuer shall also furnish to the Indenture Trustee an Independent
Certificate as to the same matters if the fair value of the property or
securities and of all other property, other than property as contemplated by
clause (v) below, or securities released from the lien of this Indenture since
the commencement of the then-current calendar year, as set forth in the
certificates required by clause (iii) above and this clause (iv), equals 10% or
more of the Outstanding Amount of the Notes, but such certificate need not be
furnished in the case of any release of property or securities if the fair value
thereof as set forth in the related Officers' Certificate is less than $25,000
or less than one percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding Section 2.9 or any other provision of
this Section, the Issuer may, without compliance with the requirements of the
other provisions of this Section, (A) collect, liquidate, sell or otherwise
dispose of Trust Student Loans as and to the extent permitted or required by the
Basic Documents, (B) make cash payments out of the Trust Accounts as and to the
extent permitted or required by the Basic Documents and (C) convey to the
Depositor, the Servicer or another eligible lender those specified Trust Student
Loans as and to the extent permitted or required by and in accordance with
Section 8.4(c) hereof and Section 6 of the Sale Agreement, Section 3.5 of the
Servicing Agreement or Section 3.11E of the Servicing Agreement, respectively,
so long as the Issuer shall deliver to the Indenture Trustee every six months,
commencing December 31, 2004, an Officers' Certificate of the Issuer stating
that all
50
the dispositions of Collateral described in clauses (A), (B) or (C) above that
occurred during the immediately preceding six calendar months were in the
ordinary course of the Issuer's business and that the proceeds thereof were
applied in accordance with the Basic Documents.
SECTION 11.2 Form of Documents Delivered to Indenture Trustee.
In any case where several matters are required to be certified by, or covered by
an opinion of, any specified Person, it is not necessary that all such matters
be certified by, or covered by the opinion of, only one such Person, or that
they be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters, and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer, the Depositor, the Issuer or the Administrator, stating that the
information with respect to such factual matters is in the possession of the
Servicer, the Depositor, the Issuer or the Administrator, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Whenever in this Indenture, in connection with any application
or certificate or report to the Indenture Trustee, it is provided that the
Issuer shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuer's compliance with any term hereof, it
is intended that the truth and accuracy, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency of such certificate or report. The foregoing shall not,
however, be construed to affect the Indenture Trustee's right to rely upon the
truth and accuracy of any statement or opinion contained in any such document as
provided in Article VI.
SECTION 11.3 Acts of Noteholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee, and, where it
is hereby expressly required, to the Issuer. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Noteholders
51
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 6.1) conclusive in favor of
the Indenture Trustee and the Issuer, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any person of any such
instrument or writing may be proved in any manner that the Indenture Trustee
deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice,
consent, waiver or other action by any Noteholder shall bind the Noteholder of
every Note issued upon registration of transfer thereof or in exchange therefor
or in lieu thereof, in respect of anything done, omitted or suffered to be done
by the Indenture Trustee or the Issuer in reliance thereon, whether or not
notation of such action is made upon such Note.
SECTION 11.4 Notices, etc., to Indenture Trustee, Issuer and
Rating Agencies. Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture shall be in writing and if such request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders is to be made upon,
given or furnished to or filed with:
(a) The Indenture Trustee by any Noteholder, the Servicer, the
Administrator or by the Issuer shall be sufficient for every purpose hereunder
if made, given, furnished or filed in writing to or with the Indenture Trustee
at its Corporate Trust Office with a copy to: The Bank of New York, 0 Xxxxx
XxXxxxx Xx., Xxxxx 0000, Xxxxxxx, Xxxxxxxx, 00000, Attention: Corporate Trust -
Structured Finance.
(b) The Issuer by the Indenture Trustee or by any Noteholder shall
be sufficient for every purpose hereunder if in writing and mailed, first-class,
postage prepaid, to the Issuer addressed to: SLM Student Loan Trust 2004-3, in
care of Chase Manhattan Bank USA, National Association, Christiana Center/OPS4,
000 Xxxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx 00000, Attention: Corporate Trust
Department; with copies to JPMorgan Chase Bank, 000 Xxxx 00xx Xxxxxx 00xx Xx.,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Structured Finance Services; and the
Administrator, 00000 Xxxxxx Xxx Xxxxx, Xxxxxx, Xxxxxxxx 00000, Attention: ABS
Trust Administration, or any other address previously furnished in writing to
the Indenture Trustee by the Issuer or the Administrator. The Issuer shall
promptly transmit any notice received by it from the Noteholders to the
Indenture Trustee.
Notices required to be given to the Rating Agencies by the
Issuer, the Indenture Trustee or the Eligible Lender Trustee shall be in
writing, personally delivered or mailed by certified mail, return receipt
requested, to (i) in the case of Moody's, at the following address: ABS
Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (ii) in the
case of S&P, at the following address: 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000, Attention: Asset Backed Surveillance Department, 32nd Floor, and
(iii) in the case of Fitch, at the following address: Xxx Xxxxx Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Municipal Structured
52
Finance Group; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
Notices to any Swap Counterparty will be sent to the addresses
set forth in the related Swap Agreement or the Interest Rate Cap Agreement,
respectively or such other addresses as may be designated by written notice to
the parties to this Indenture.
SECTION 11.5 Notices to Noteholders; Waiver. Where this
Indenture provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture Trustee
shall be deemed to be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any other rights or
obligations created hereunder, and shall not under any circumstance constitute a
Default.
SECTION 11.6 Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Noteholder providing
for a method of payment, or notice by the Indenture Trustee or any Paying Agent
to such Noteholder, that is different from the methods provided for in this
Indenture for such payments or notices. The Issuer will furnish to the Indenture
Trustee a copy of each such agreement and the Indenture Trustee will cause
payments to be made and notices to be given in accordance with such agreements.
SECTION 11.7 Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with another provision hereof
that is required to be included in this Indenture by any of the provisions of
the Trust Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose
duties on any Person (including the provisions automatically deemed included
herein unless expressly excluded by
53
this Indenture) are a part of and govern this Indenture, whether or not
physically contained herein.
SECTION 11.8 Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 11.9 Successors and Assigns. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successor and assigns, whether so expressed or not. All agreements of the
Indenture Trustee in this Indenture shall bind the successors, co-trustees and
agents (excluding any legal representatives or accountants) of the Indenture
Trustee.
SECTION 11.10 Separability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
SECTION 11.11 Benefits of Indenture. (a) Except as set forth
in paragraphs (b) and (c) below, nothing in this Indenture or in the Notes,
express or implied shall give to any person, other than the parties hereto and
their successors hereunder, the Noteholders, any other party secured hereunder,
and any other Person with an ownership interest in any part of the Indenture
Trust Estate, any benefit or any legal or equitable right, remedy or claim under
this Indenture.
(b) The parties to this Indenture acknowledge and agree that each
Swap Counterparty is an intended third party beneficiary of this Indenture to
the extent of its rights hereunder and under the related Swap Agreement entered
into by the Issuer from time to time and shall be entitled to enforce such
rights.
(c) The parties to this Indenture acknowledge and agree that SLM
Corporation, and any permitted transferee, if applicable, is an intended third
party beneficiary of this Indenture to the extent of its rights with respect to
the Call Option as set forth in Section 7 of Appendix A-2 hereto and shall be
entitled to enforce such rights.
SECTION 11.12 Legal Holidays. In any case where the date on
which any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
SECTION 11.13 Governing Law. THIS INDENTURE SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL
OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
54
SECTION 11.14 Counterparts. This Indenture may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
SECTION 11.15 Recording of Indenture. If this Indenture is
subject to recording in any appropriate public recording offices, such recording
is to be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.
SECTION 11.16 Trust Obligations. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the
Depositor, the Administrator, the Servicer, the Eligible Lender Trustee or the
Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Eligible Lender Trustee in its individual capacity,
(ii) any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Indenture
Trustee or the Eligible Lender Trustee in its individual capacity, any holder or
owner of a beneficial interest in the Issuer, the Eligible Lender Trustee or the
Indenture Trustee or of any successor or assign thereof in its individual
capacity, except as any such Person may have expressly agreed (it being
understood that the Indenture Trustee and the Eligible Lender Trustee have no
such obligations in their individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by applicable
law, for any unpaid consideration for stock, unpaid capital contribution or
failure to pay any installment or call owing to such entity. For all purposes of
this Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Eligible Lender Trustee shall be subject to, and entitled to the
benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust
Agreement.
SECTION 11.17 No Petition. The Indenture Trustee, by entering
into this Indenture, and each Noteholder, by accepting a Note, hereby covenant
and agree that they shall not at any time institute against the Depositor or the
Issuer, or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency, receivership or liquidation
proceedings, or other proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Notes, this Indenture or any of the other Basic Documents. The foregoing shall
not limit the rights of the Indenture Trustee to file any claim in, or otherwise
take any action with respect to, any insolvency proceeding that was instituted
against the Issuer by any Person other than the Indenture Trustee.
SECTION 11.18 Inspection. The Issuer agrees that, on
reasonable prior notice, it shall permit any representative of the Indenture
Trustee, during the Issuer's normal business hours, to examine all the books of
account, records, reports, and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified
public accountants, and to discuss the Issuer's affairs, finances and accounts
with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Indenture Trustee shall and shall cause its
55
representatives to hold in confidence all such information obtained from such
examination or inspection except to the extent disclosure may be required by law
(and all reasonable applications for confidential treatment are unavailing) and
except to the extent that the Indenture Trustee may reasonably determine that
such disclosure is consistent with its obligations hereunder.
SECTION 11.19 Subordination. All rights and interest of each
Currency Swap Counterparty in the security interest granted to the Indenture
Trustee under this Indenture shall be fully subordinated to the interests of the
Noteholders. No Currency Swap Counterparty shall have any rights, implied or
otherwise, in the Collateral until after the Outstanding Amount of the Notes has
been reduced to zero and the Noteholders have been paid all amounts owed to them
under this Indenture. Notwithstanding the foregoing, the provisions of this
Section 11.19 shall not modify or otherwise affect the contractual priority of
payments set forth in Section 5.4(b) hereof or Section 2.8 of the Administration
Agreement. More specifically, no Currency Swap Counterparty shall have any
voting rights or rights to exercise any remedies under this Indenture until
after the Outstanding Amount of the Notes has been reduced to zero and the
Noteholders have been paid all amounts owed to them under this Indenture. After
the Outstanding Amount of the Notes has been reduced to zero and the Noteholders
have been paid all amounts owed to them under this Indenture, each Currency Swap
Counterparty shall have all of the rights and obligations, including all voting
rights, of the Noteholders set forth in this Indenture.
56
IN WITNESS WHEREOF, the Issuer, the Eligible Lender Trustee
and the Indenture Trustee have caused this Indenture to be duly executed by
their respective officers, thereunto duly authorized and duly attested, all as
of the day and year first above written.
SLM STUDENT LOAN TRUST 2004-3
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
THE BANK OF NEW YORK,
not in its individual capacity but solely
as Indenture Trustee
By: /s/ XXXX X. XXXXXXX
Name: Xxxx X. Xxxxxxx
Title: Agent
57
ACCEPTED AND AGREED TO WITH RESPECT TO THE TRANSFER OF ALL RIGHT, TITLE AND
INTEREST IN AND TO THE CALL OPTION CONTAINED IN, AND SUBJECT TO THE TERMS AND
CONDITIONS SET FORTH IN, SECTION 7 OF APPENDIX A-2 TO THIS INDENTURE
SLM FUNDING LLC
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
SLM CORPORATION
By: /s/ J. XXXXX XXXXXX
Name: J. Xxxxx Xxxxxx
Title: Authorized Agent
58
APPENDIX A-1
DEFINITIONS AND USAGE
SERIES 2004-3
USAGE
The following rules of construction and usage shall be applicable to
any instrument that is governed by this appendix (this "Appendix"):
(a) All terms defined in this Appendix shall have the defined
meanings when used in any instrument governed hereby and in any certificate or
other document made or delivered pursuant thereto unless otherwise defined
therein.
(b) As used herein, in any instrument governed hereby and in any
certificate or other document made or delivered pursuant thereto, accounting
terms not defined in this Appendix or in any such instrument, certificate or
other document, and accounting terms partly defined in this Appendix or in any
such instrument, certificate or other document, to the extent not defined, shall
have the respective meanings given to them under generally accepted accounting
principles as in effect on the date of such instrument. To the extent that the
definitions of accounting terms in this Appendix or in any such instrument,
certificate or other document are inconsistent with the meanings of such terms
under generally accepted accounting principles, the definitions contained in
this Appendix or in any such instrument, certificate or other document shall
control.
(c) The words "hereof," "herein," "hereunder" and words of similar
import when used in an instrument refer to such instrument as a whole and not to
any particular provision or subdivision thereof; references in an instrument to
"Article," "Section" or another subdivision or to an attachment are, unless the
context otherwise requires, to an article, section or subdivision of or an
attachment to such instrument; and the term "including" means "including without
limitation."
(d) The definitions contained in this Appendix are equally
applicable to both the singular and plural forms of such terms and to the
masculine as well as to the feminine and neuter genders of such terms.
(e) Any agreement, instrument or statute defined or referred to
below or any agreement or instrument that is governed by this Appendix means
such agreement or instrument or statute as from time to time amended, modified
or supplemented, including (in the case of agreements or instruments) by
assignment, assumption, waiver or consent and (in the case of statutes) by
succession of comparable successor statutes and includes (in the case of
agreements or instruments) references to all attachments thereto and instruments
incorporated therein. References to a Person are also to its permitted
successors and assigns.
Appendix A-2-1
"30/360" means that interest is calculated on the basis of a 360-day
year consisting of twelve 30-day months.
"91-day Treasury Xxxx Rate" means, for any relevant Interest Rate
Determination Date, prior to each Interest Rate Change Date, the rate equal to
the weighted average per annum discount rate (expressed as a bond equivalent
yield and applied on a daily basis) for direct obligations of the United States
with a maturity of thirteen weeks ("91-day Treasury Bills") sold at the
applicable 91-day Treasury Xxxx auction, as published in H.15(519) or otherwise
or as reported by the U.S. Department of the Treasury. In the event that the
results of the auctions of 91-day Treasury Bills cease to be published or
reported as provided above, or that no 91-day Treasury Xxxx auction is held in a
particular week, then the 91-day Treasury Xxxx Rate in effect as a result of the
last such publication or report will remain in effect until such time, if any,
as the results of auctions of 91-day Treasury Bills will again be so published
or reported or such auction is held, as the case may be. The 91-day Treasury
Xxxx Rate will be subject to a Lock-In Period of six Business Days.
"Accrual Period" means, with respect to a Distribution Date and (i)
each class of Notes bearing a floating rate of interest (including, without
limitation, the Floating Rate Notes and any class of Reset Rate Notes that bears
interest at a floating rate), the period from and including the immediately
preceding Distribution Date for such class of Notes to but excluding the
then-current Distribution Date, or in the case of the initial such period for
the Floating Rate Notes, the period from and including the Closing Date to and
including July 25, 2004; provided that if more than one Interest Rate Change
Date occurs for any class of Reset Rate Notes bearing a floating rate of
interest within any given Accrual Period, the rate of interest for the entire
Accrual Period shall be as specified in the relevant Remarketing Terms Notice;
and (ii) any class of Reset Rate Notes bearing a fixed rate of interest and (x)
is denominated in U.S. Dollars, the period from and including the 25th day of
the month of the last applicable Distribution Date, to and including the 24th
day of the month of the then-current applicable Distribution Date for such class
of Reset Rate Notes, or (y) is denominated in a currency other than U.S.
Dollars, (A) the period from and including the 25th day of the month of the last
applicable Distribution Date, to and including the 24th day of the month of the
then-current applicable Distribution Date or (B) as otherwise specified on the
Schedule A for the Reset Rate Notes.
"Accumulation Account" means each account designated as such,
established and maintained pursuant to Section 2.3(j) of the Administration
Agreement.
"Act" means the Securities Act of 1933, as amended.
"Actual/360" means that interest is calculated on the basis of the
actual number of days elapsed in a year of 360 days.
"Actual/365 (fixed)" means that interest is calculated on the basis of
the actual number of days elapsed in a year of 365 days, regardless of whether
accrual or payment occurs in a leap year.
"Actual/Actual (accrual basis)" means that interest is calculated on
the basis of the actual number of days elapsed in a year of 365 days, or 366
days for every day in a leap year.
Appendix A-1-2
"Actual/Actual (ISMA)" means a calculation in accordance with the
definition of "Actual/Actual" adopted by the International Securities Market
Association ("ISMA"), which means that interest is calculated on the following
basis:
(1) where the number of days in the relevant Accrual
Period is equal to or shorter than the Determination Period during
which such Accrual Period ends, the number of days in such Accrual
Period divided by the product of (A) the number of days in such
Determination Period and (B) the number of Distribution Dates that
would occur in one calendar year; or
(2) where the Accrual Period is longer than the
Determination Period during which the Accrual Period ends, the sum of:
(A) the number of days in such Accrual Period
falling in the Determination Period in which the Accrual Period begins
divided by the product of (x) the number of days in such Determination
Period and (y) the number of Distribution Dates that would occur in one
calendar year; and
(B) the number of days in such Accrual Period
falling in the next Determination Period divided by the product of (x)
the number of days in such Determination Period and (y) the number of
Distribution Dates that would occur in one calendar year;
where "Determination Period" means the period from and including one Calculation
Date to but excluding the next Calculation Date and "Calculation Date" means, in
each year, each of those days in the calendar year that are specified herein as
being the scheduled Distribution Dates.
"Actual/Actual (payment basis)" means that interest is calculated on
the basis of the actual number of days elapsed in a year of 365 days if the
interest period ends in a non-leap year, or 366 days if the interest period ends
in a leap year, as the case may be.
"Adjusted Pool Balance" means, for any Distribution Date, (a) if the
Pool Balance as of the last day of the related Collection Period is greater than
40% of the Initial Pool Balance, the sum of that Pool Balance, Capitalized
Interest and the Specified Reserve Account Balance for that Distribution Date or
(b) if the Pool Balance as of the last day of the related Collection Period is
less than or equal to 40% of the Initial Pool Balance, the sum of that Pool
Balance and Capitalized Interest.
"Administration Agreement" means the Administration Agreement, dated as
of March 18, 2004, among the Administrator, the Servicer, the Depositor, the
Trust and the Eligible Lender Trustee, and as such agreement may be further
amended or supplemented from time to time.
"Administration Fees" has the meaning specified in Section 2.14 of the
Administration Agreement.
"Administrator" means Xxxxxx Mae, Inc., in its capacity as
administrator of the Trust in accordance with the Administration Agreement.
Appendix A-2-3
"Administrator Default" has the meaning specified in Section 5.1 of the
Administration Agreement.
"Administrator's Certificate" means an Officers' Certificate of the
Administrator delivered pursuant to Section 3.1(c) of the Administration
Agreement.
"Affiliate" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" when used with respect to
any specified Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"All Hold Rate" means, if a class of Reset Rate Notes is denominated in
U.S. Dollars during the then-current Reset Period and the immediately following
Reset Period, the applicable Index plus or minus the applicable Spread (if such
class of Reset Rate Notes is in floating rate mode) or the applicable fixed
rate, which may be expressed as the fixed rate pricing benchmark plus or minus a
spread (if such class of Reset Rate Notes is in fixed rate mode), that the
Remarketing Agents, in consultation with the Administrator, determine will be
effective, unless the Call Option is exercised, in the event that 100% of the
holders of that class of Reset Rate Notes choose to hold their Notes for the
upcoming Reset Period. The All Hold Rate shall be a rate that the Remarketing
Agents, in consultation with the Administrator, and in their good faith
determination, believe would result in the remarketing of the entire applicable
class of Reset Rate Notes at a price equal to 100% of the Outstanding Amount
thereof.
"Authorized Officer" means (i) with respect to the Trust, any officer
of the Eligible Lender Trustee who is authorized to act for the Eligible Lender
Trustee in matters relating to the Trust pursuant to the Basic Documents and who
is identified on the list of Authorized Officers delivered by the Eligible
Lender Trustee to the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter), (ii) with respect to the
Administrator, any officer of the Administrator or any of its Affiliates who is
authorized to act for the Administrator in matters relating to itself or to the
Trust and to be acted upon by the Administrator pursuant to the Basic Documents
and who is identified on the list of Authorized Officers delivered by the
Administrator to the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter), (iii) with respect to
the Depositor, any officer of the Depositor or any of its Affiliates who is
authorized to act for the Depositor in matters relating to or to be acted upon
by the Depositor pursuant to the Basic Documents and who is identified on the
list of Authorized Officers delivered by the Depositor to the Indenture Trustee
on the Closing Date (as such list may be modified or supplemented from time to
time thereafter) and (iv) with respect to the Servicer, any officer of the
Servicer who is authorized to act for the Servicer in matters relating to or to
be acted upon by the Servicer pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Servicer to the
Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter).
"Available Funds" means, as to a Distribution Date or any related
Monthly Servicing Payment Date, the sum of the following amounts received with
respect to the related Collection
Appendix A-2-4
Period or, in the case of a Monthly Servicing Payment Date, the applicable
portion of these amounts:
(a) all collections on the Trust Student Loans (including
for this purpose, as to the first Distribution Date, the Collection Account
Initial Deposit), including any Guarantee Payments received on the Trust Student
Loans, but net of:
(1) any collections in respect of principal on
the Trust Student Loans applied by the Trust to repurchase
guaranteed loans from the Guarantors under the Guarantee
Agreements, and
(2) amounts required by the Higher Education Act
to be paid to the Department or to be repaid to borrowers,
whether or not in the form of a principal reduction of the
applicable Trust Student Loan, on the Trust Student Loans for
that Collection Period including Consolidation Loan rebate
fees;
(b) any Interest Subsidy Payments and Special Allowance
Payments with respect to the Trust Student Loans during that Collection Period;
(c) all Liquidation Proceeds from any Trust Student Loans
which became Liquidated Student Loans during that Collection Period in
accordance with the Servicer's customary servicing procedures, net of expenses
incurred by the Servicer related to their liquidation and any amounts required
by law to be remitted to the borrowers on the Liquidated Student Loans, and all
Recoveries on Liquidated Student Loans which were written off in prior
Collection Periods or during that Collection Period;
(d) the aggregate Purchase Amounts received during that
Collection Period for those Trust Student Loans repurchased by the Depositor or
purchased by the Servicer or for Trust Student Loans sold to another eligible
lender pursuant to Section 3.11E of the Servicing Agreement;
(e) the aggregate Purchase Amounts received during that
Collection Period for those Trust Student Loans purchased by either SLMA or SLM
ELC;
(f) the aggregate amounts, if any, received from any of
SLMA, SLM ELC, the Depositor or the Servicer, as the case may be, as
reimbursement of nonguaranteed interest amounts, or lost Interest Subsidy
Payments and Special Allowance Payments, on the Trust Student Loans pursuant to
the Sale Agreement or Section 3.5 of the Servicing Agreement, respectively;
(g) amounts received by the Trust pursuant to Sections
3.1 and 3.12 of the Servicing Agreement during that Collection Period as to
yield or principal adjustments;
(h) any interest remitted by the Administrator to the
Collection Account prior to such Distribution Date or Monthly Servicing Payment
Date;
Appendix A-2-5
(i) Investment Earnings for that Distribution Date earned
on amounts on deposit in each Trust Account (other than any Accumulation
Account, the Pounds Sterling Account or any Other Currency Account);
(j) Investment Earnings actually received by the Trust
for that Distribution Date, earned on amounts on deposit in any Accumulation
Account;
(k) amounts transferred from the Remarketing Fee Account
in excess of the sum of the Reset Period Target Amounts for that Distribution
Date;
(l) payments received under the Interest Rate Cap
Agreement;
(m) amounts transferred from the Reserve Account in
excess of the Specified Reserve Account Balance as of that Distribution Date;
(n) the Investment Premium Purchase Account Release
Amount transferred from any Investment Premium Purchase Account on that
Distribution Date;
(o) all amounts on deposit in any Investment Reserve
Account not transferred to the related Accumulation Account to offset realized
losses on Eligible Investments actually incurred by the Trust as of that
Distribution Date;
(p) all amounts received by the Trust from any Swap
Counterparty for deposit into the Collection Account, but only to the extent
paid in U.S. Dollars during that Collection Period;
(q) all amounts on deposit in any Supplemental Interest
Account;
(r) amounts transferred from the Reserve Account in
excess of the Specified Reserve Account Balance for that Distribution Date; and
(s) on the April 2005 Distribution Date, all funds then
on deposit in the Capitalized Interest Account that are transferred into the
Collection Account on that Distribution Date;
provided that if on any Distribution Date there would not be sufficient funds,
after application of Available Funds, as defined above, and application of
amounts available from the Capitalized Interest Account and the Reserve Account,
in that order, to pay certain of the items specified in clauses (a) through (e)
of Section 2.8 of the Administration Agreement (but excluding clause (e), and
including clauses (f) and (g) thereof, in the event that a condition exists as
described in either clause (i) or (ii) of the last paragraph of Section 2.8 of
the Administration Agreement), as set forth in Sections 2.9 and 2.10(a) of the
Administration Agreement, relating to such allocations and distributions, then
Available Funds for that Distribution Date will include, in addition to the
Available Funds as defined above, amounts on deposit in the Collection Account,
or amounts held by the Administrator, or which the Administrator reasonably
estimates to be held by the Administrator, for deposit into the Collection
Account which would have constituted Available Funds for the Distribution Date
succeeding that Distribution Date, up to the amount necessary to
Appendix A-2-6
pay such items, and the Available Funds for the succeeding Distribution Date
will be adjusted accordingly.
"Basic Documents" means the Trust Agreement, the Indenture, the
Servicing Agreement, the Administration Agreement, the Sale Agreement, the SLMA
Purchase Agreement, the SLM ELC Purchase Agreement, the Guarantee Agreements,
the Note Depository Agreements, any Remarketing Agreement, any Swap Agreements
(including the Interest Rate Cap Agreement and the Initial Currency Swap
Agreements) and other documents and certificates delivered in connection with
any such documents.
"Benefit Plan" has the meaning specified in Exhibit C to the Trust
Agreement.
"Xxxx of Sale" has the meaning specified in any of the Purchase
Agreements or the Sale Agreement, as applicable.
"Book-Entry Note" means a beneficial interest in the Notes, ownership
and transfers of which shall be made through book entries by a Clearing Agency
as described in Section 2.10 of the Indenture.
"Business Day" means (i) with respect to calculating LIBOR of a
specified maturity or GBP-LIBOR of a specified maturity, any day on which banks
in New York, New York and London, England are open for the transaction of
international business and making payments in respect of any class of Reset Rate
Notes denominated in a currency other than U.S. Dollars; (ii) with respect to
calculating GBP-LIBOR of a specified maturity, any day on which TARGET, London,
England and banks in New York, New York are open for the transaction of
international business and making payments in respect of any class of Reset Rate
Notes denominated in a currency other than U.S. Dollars; and (iii) for all other
purposes, any day other than a Saturday, a Sunday or a day on which banking
institutions or trust companies in New York, New York or Wilmington, Delaware
are authorized or obligated by law, regulation or executive order to remain
closed.
"Call Option" means, the option assigned by the Depositor to SLM
Corporation which may be further assigned by SLM Corporation to one of its
subsidiaries as a permitted transferee (provided, that no such subsidiary shall
possess the Call Option if it at any time owned an interest in any of the Trust
Student Loans) to purchase 100% of a class of Reset Rate Notes in its entirety
as of its related Reset Date, exercisable at a price equal 100% of the
Outstanding Amount of such class of Reset Rate Notes, less all amounts
distributed to the related Reset Rate Noteholders as a payment of principal in
respect of the related Distribution Date, plus any accrued and unpaid interest
not paid by the Trust in respect of the related Distribution Date, and pursuant
to the terms and conditions set forth in the Reset Rate Note Procedures.
"Call Option Notice" means a written notice from the holder of the Call
Option or the Administrator, as applicable, stating its desire to exercise the
Call Option on the related Reset Date, delivered to each Clearing Agency, the
Indenture Trustee, the Remarketing Agents, the Rating Agencies and, if the
related class of Reset Rate Notes is then listed on the Luxembourg Stock
Exchange, the Administrator will forward a copy to the Luxembourg Listing Agent
(the
Appendix A-2-7
contents of which are to be published in a leading newspaper having general
circulation in Luxembourg).
"Call Rate" means, if a Call Option has been exercised with respect to
a class of Reset Rate Notes, the rate of interest that is either (1) if that
class did not have at least one related Swap Agreement in effect during the
previous Reset Period, the floating rate applicable for the most recent Reset
Period during which the Failed Remarketing Rate was not in effect; or (2) if
that class had one or more related Swap Agreements in effect during the previous
Reset Period, the weighted average of the floating rates of interest that were
due to the related Interest Rate Swap Counterparties from the Trust during the
previous Reset Period. The Call Rate will continue to apply for each Reset
Period while the holder of the Call Option retains that class of Reset Rate
Notes.
"Capitalized Interest" means for any Distribution Date through and
including the April 2005 Distribution Date:
(a) if neither of the conditions set forth in Section 2.10(a) of
the Administration Agreement are in effect, the amount on
deposit in the Capitalized Interest Account on the
Distribution Date following distributions with respect to
clauses (d)(1), (d)(2) and (e) of Section 2.8 of the
Administration Agreement, or
(b) if either of the conditions set forth in Section 2.10(a) of
the Administration Agreement is in effect, the excess, if any,
of (x) the amount on deposit in the Capitalized Interest
Account on the Distribution Date following distributions with
respect to clauses (d)(1) and (d)(2) of Section 2.8 of the
Administration Agreement over (y) the Class B Noteholders'
Interest Distribution Amount.
"Capitalized Interest Account" means the account designated as such,
established and maintained pursuant to Section 2.3(h) of the Administration
Agreement.
"Capitalized Interest Account Initial Deposit" means $32,000,000.
"Carryover Servicing Fee" has the meaning specified in Attachment A to
the Servicing Agreement.
"Class A Note" means, a Class A-1 Note, a Class A-2 Note, a Class A-3
Note, a Class A-4 Note, a Class A-5 Note, a Class A-6A Note or a Class A-6B
Note.
"Class A Note Interest Shortfall" means, for any Distribution Date, the
excess of (x) the Class A Noteholders' Interest Distribution Amount on the
preceding Distribution Date, over (y) the amount of interest actually
distributed to the Class A Noteholders or the Currency Swap Counterparty, as
applicable, on the preceding Distribution Date, plus (2) interest on the amount
of that excess, to the extent permitted by law, at the interest rate applicable
for each such Class of Notes from the preceding Distribution Date to the current
Distribution Date.
"Class A Note Principal Shortfall" means, as of the close of any
Distribution Date, the excess of (i) the Class A Noteholders' Principal
Distribution Amount on that Distribution Date,
Appendix A-2-8
over (ii) the amount of principal actually distributed or allocated to the Class
A Noteholders or deposited into any Accumulation Account on such Distribution
Date.
"Class A Noteholder" means the Person in whose name a Class A Note is
registered in the Note Register.
"Class A Noteholders' Distribution Amount" means, for any Distribution
Date, the sum of the Class A Noteholders' Interest Distribution Amount and the
Class A Noteholders' Principal Distribution Amount for that Distribution Date.
"Class A Noteholders' Interest Distribution Amount" means, for any
Distribution Date, the sum of: (1) the amount of interest accrued at the Class
A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the Class
A-5 Rate, the Class A-6A Rate or the Class A-6B Rate, as applicable, for the
related Accrual Period on the Outstanding Amount of all classes of Class A Notes
on the immediately preceding Distribution Date(s) after giving effect to all
principal distributions to Class A Noteholders on that preceding Distribution
Date or, in the case of the first Distribution Date, on the Closing Date, and
(2) the Class A Note Interest Shortfall for that Distribution Date.
"Class A Noteholders' Principal Distribution Amount" means, for any
Distribution Date, the Principal Distribution Amount times the Class A
Percentage for that Distribution Date, plus any Class A Note Principal Shortfall
as of the close of business on the preceding Distribution Date; provided that
the Class A Noteholders' Principal Distribution Amount will not exceed the
Outstanding Amount of the Class A Notes (less all amounts, other than Investment
Earnings, on deposit in any related Accumulation Account). In addition, on the
Class A-1 Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity
Date, the Class A-4 Maturity Date, the Class A-5 Maturity Date, the Class A-6A
Maturity Date or the Class A-6B Maturity Date, as applicable, the principal
required to be distributed to the related Class A Noteholders will include the
amount required to reduce the Outstanding Amount of that class to zero.
"Class A Notes" means the Floating Rate Class A Notes and the Reset
Rate Notes.
"Class A Percentage" means 100% minus the Class B Percentage.
"Class A-1 Maturity Date" means the October 2009 Distribution Date.
"Class A-2 Maturity Date" means the April 2013 Distribution Date.
"Class A-3 Maturity Date" means the April 2016 Distribution Date.
"Class A-4 Maturity Date" means the April 2019 Distribution Date.
"Class A-5 Maturity Date" means the July 2023 Distribution Date.
"Class A-6A Maturity Date" means the October 2039 Distribution Date.
"Class A-6B Maturity Date" means the October 2039 Distribution Date.
Appendix A-2-9
"Class A-1 Noteholder" means a Person in whose name a Class A-1 Note is
registered in the Note Register.
"Class A-2 Noteholder" means a Person in whose name a Class A-2 Note is
registered in the Note Register.
"Class A-3 Noteholder" means a Person in whose name a Class A-3 Note is
registered in the Note Register.
"Class A-4 Noteholder" means a Person in whose name a Class A-4 Note is
registered in the Note Register.
"Class A-5 Noteholder" means a Person in whose name a Class A-5 Note is
registered in the Note Register.
"Class A-6A Noteholder" means a Person in whose name a Class A-6A Note
is registered in the Note Register.
"Class A-6B Noteholder" means a Person in whose name a Class A-6B Note
is registered in the Note Register.
"Class A-1 Notes" means the $315,000,000 Floating Rate Class A-1
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-1 thereto.
"Class A-2 Notes" means the $421,000,000 Floating Rate Class A-2
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-2 thereto.
"Class A-3 Notes" means the $376,000,000 Floating Rate Class A-3
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-3 thereto.
"Class A-4 Notes" means the $439,000,000 Floating Rate Class A-4
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-4 thereto.
"Class A-5 Notes" means the $701,121,000 Floating Rate Class A-5
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-5 thereto.
"Class A-6A Notes" means the (pound)200,000,000 Reset Rate Class A-6A
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibits X-0, X-0 and A-8 thereto.
"Class A-6B Notes" means the (pound)200,000,000 Reset Rate Class A-6B
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibits X-0, X-00 and A-11 thereto.
Appendix A-2-10
"Class A-1 Rate" means, for any Accrual Period after the initial
Accrual Period, Three-Month LIBOR, as determined on the related LIBOR
Determination Date, minus 0.01%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-1 Rate shall mean the Initial Accrual Rate
minus 0.01%, based on an Actual/360 accrual method.
"Class A-2 Rate" means, for any Accrual Period after the initial
Accrual Period, Three-Month LIBOR, as determined on the related LIBOR
Determination Date, plus 0.01%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-2 Rate shall mean the Initial Accrual Rate
plus 0.01%, based on an Actual/360 accrual method.
"Class A-3 Rate" means, for any Accrual Period after the initial
Accrual Period, Three-Month LIBOR, as determined on the related LIBOR
Determination Date, plus 0.09%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-3 Rate shall mean the Initial Accrual Rate
plus 0.09%, based on an Actual/360 accrual method.
"Class A-4 Rate" means, for any Accrual Period after the initial
Accrual Period, Three-Month LIBOR, as determined on the related LIBOR
Determination Date, plus 0.13%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-4 Rate shall mean the Initial Accrual Rate
plus 0.13%, based on an Actual/360 accrual method.
"Class A-5 Rate" means, for any Accrual Period after the initial
Accrual Period, Three-Month LIBOR, as determined on the related LIBOR
Determination Date, plus 0.17%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-5 Rate shall mean the Initial Accrual Rate
plus 0.17%, based on an Actual/360 accrual method.
"Class A-6A Rate" means, for any Accrual Period after the initial
Accrual Period until and including the Initial Reset Date for the Class A-6A
Notes, Three-Month GBP-LIBOR, as determined on the related GBP-LIBOR
Determination Date, plus 0.18%, based on an Actual/365 (Fixed) accrual method.
For the initial Accrual Period, the Class A-6A Rate shall mean the Initial
Accrual Rate plus 0.18%, based on an Actual/365 (Fixed) accrual method. The
Class A-6A Rate shall be changed on each related Reset Date to the interest rate
and Day Count Basis that will be set forth in the notice required to be
delivered by the Administrator and/or the Remarketing Agents on each Remarketing
Terms Determination Date and Spread Determination Date, as applicable, pursuant
to the procedures set forth in the Reset Rate Note Procedures.
"Class A-6B Rate" means, for any Accrual Period after the initial
Accrual Period until and including the Initial Reset Date for the Class A-6B
Notes, Three-Month GBP-LIBOR, as determined on the related GBP-LIBOR
Determination Date, plus 0.18%, based on an Actual/365 (fixed) accrual method.
For the initial Accrual Period, the Class A-6A Rate shall mean the Initial
Accrual Rate plus 0.18%, based on an Actual/365 (fixed) accrual method. The
Class A-6B Rate shall be changed on each related Reset Date to the interest rate
and Day Count Basis that will be set forth in the notice required to be
delivered by the Administrator and/or the Remarketing Agents on each Remarketing
Terms Determination Date and Spread Determination Date, as applicable, pursuant
to the procedures set forth in the Reset Rate Note Procedures.
"Class B Maturity Date" means the October 2039 Distribution Date.
Appendix A-2-11
"Class B Note Interest Shortfall" means, for any Distribution Date, (1)
the excess of (x) the Class B Noteholders' Interest Distribution Amount on the
preceding Distribution Date, over (y) the amount of interest actually
distributed to the Class B Noteholders on that preceding Distribution Date, plus
(2) interest on the amount of that excess, to the extent permitted by law, at
the Class B Rate from that preceding Distribution Date to the current
Distribution Date.
"Class B Note Principal Shortfall" means, as of the close of any
Distribution Date, the excess of (x) the Class B Noteholders' Principal
Distribution Amount on that Distribution Date over (y) the amount of principal
actually distributed to the Class B Noteholders on that Distribution Date, plus
(z) interest on the amount of the excess, to the extent permitted by law, at the
Class B Rate from that preceding Distribution Date to the current Distribution
Date.
"Class B Noteholder" means the Person in whose name a Class B Note is
registered in the Note Register.
"Class B Noteholders' Distribution Amount" means, for any Distribution
Date, the sum of the Class B Noteholders' Interest Distribution Amount and the
Class B Noteholders' Principal Distribution Amount for that Distribution Date.
"Class B Noteholders' Interest Distribution Amount" means, for any
Distribution Date, the sum of (1) the amount of interest accrued at the Class B
Rate for the related Accrual Period on the Outstanding Amount of the Class B
Notes on the immediately preceding Distribution Date (or, in the case of the
first Distribution Date, the Closing Date), after giving effect to all principal
distributions to Class B Noteholders on that preceding Distribution Date, and
(2) the Class B Note Interest Shortfall for that Distribution Date.
"Class B Noteholders' Principal Distribution Amount" means, for any
Distribution Date, the Principal Distribution Amount times the Class B
Percentage for that Distribution Date, plus any Class B Note Principal Shortfall
as of the close of business on the preceding Distribution Date; provided that
the Class B Noteholders' Principal Distribution Amount will not exceed the
Outstanding Amount of the Class B Notes. In addition, on the Class B Maturity
Date, the principal required to be distributed to the Class B Noteholders will
include the amount required to reduce the Outstanding Amount of the Class B
Notes to zero.
"Class B Notes" means the $92,058,000 Floating Rate Class B Student
Loan-Backed Notes issued by the Trust pursuant to the Indenture, substantially
in the form of Exhibit A-12 thereto.
"Class B Percentage" with respect to any Distribution Date, means (1)
prior to the Stepdown Date or with respect to any Distribution Date on which a
Trigger Event is in effect, zero; and (2) on and after the Stepdown Date and
provided that no Trigger Event is in effect, a fraction expressed as a
percentage, the numerator of which is the aggregate principal balance of the
Class B Notes immediately prior to that Distribution Date and the denominator of
which is Outstanding Amount of the Notes, less all amounts (other than
Investment Earnings) on deposit in the Accumulation Account, immediately prior
to that Distribution Date.
"Class B Rate" means, for any Accrual Period after the initial Accrual
Date, Three-Month LIBOR, as determined on the related LIBOR Determination Date,
plus 0.47%, based on
Appendix A-2-12
an Actual/360 accrual method. For the initial Accrual Period, the Class B Rate
shall mean the Initial Accrual Rate plus 0.47%, based on an Actual/360 accrual
method.
"Clearing Agency" means DTC, Euroclear or Clearstream, as applicable,
or another organization registered as a "clearing agency" pursuant to applicable
law. The initial Clearing Agency for the Floating Rate Notes shall be DTC and
the initial nominee for such Clearing Agency shall be Cede & Co. The initial
Clearing Agencies for a class of Reset Rate Notes (i) for any related Reset
Period when it is denominated in a currency other than U.S. Dollars shall be
Euroclear and Clearstream and the initial joint nominee for such Clearing
Agencies shall be The Bank of New York Depository (Nominees) Limited, and (ii)
for any related Reset Period when it is denominated in U.S. Dollars shall be DTC
and the initial nominee for such Clearing Agency shall be Cede & Co., or
Euroclear and Clearstream and the initial joint nominee for such Clearing
Agencies shall be The Bank of New York Depository (Nominees) Limited, as
applicable.
"Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Clearstream" means Clearstream Banking, societe anonyme, Luxembourg.
"Closing Date" means March 18, 2004.
"CMT Rate" means, for any relevant Interest Rate Determination Date
prior to each Interest Rate Change Date, the rate displayed on the applicable
Designated CMT Moneyline Telerate Page shown below by 3:00 p.m., New York City
time, on that Interest Rate Determination Date under the caption ". . . Treasury
Constant Maturities . . . Federal Reserve Board Release H.15 . . . Mondays
Approximately 3:45 p.m.," under the column for: (i) if the Designated CMT
Moneyline Telerate Page is 7051, the rate on that Interest Rate Determination
Date; or (ii) if the Designated CMT Moneyline Telerate Page is 7052, the average
for the week, the month or the quarter, as specified on the Remarketing Terms
Determination Date, ended immediately before the week in which the Interest Rate
Determination Date occurs. The following procedures will apply if the CMT Rate
cannot be determined as described above: (i) if the rate described above is not
displayed on the relevant page by 3:00 p.m., New York City time on that Interest
Rate Determination Date, unless the calculation is made earlier and the rate is
available from that source at that time on that Interest Rate Determination
Date, then the CMT Rate will be the Treasury constant maturity rate having the
designated index maturity, as published in H.15(519) or another recognized
electronic source for displaying the rate, (ii) if the applicable rate described
above is not published in H.15(519) or another recognized electronic source for
displaying such rate by 3:00 p.m., New York City time on that Interest Rate
Determination Date, unless the calculation is made earlier and the rate is
available from one of those sources at that time, then the CMT Rate will be the
Treasury constant maturity rate, or other United States Treasury rate, for the
index maturity and with reference to the relevant Interest Rate Determination
Date, that is published by either the Board of Governors of the Federal Reserve
System or the United States Department of the Treasury and that the
Administrator determines to be comparable to the rate formerly displayed on the
Designated CMT Moneyline Telerate Page shown above and published in H.15(519),
(iii) if the rate
Appendix A-2-13
described in the prior paragraph cannot be determined, then the Administrator
will determine the CMT Rate to be a yield to maturity based on the average of
the secondary market closing offered rates as of approximately 3:30 p.m., New
York City time, on the relevant Interest Rate Determination Date reported,
according to their written records, by leading primary United States government
securities dealers in New York City. The Administrator will select five such
securities dealers and will eliminate the highest and lowest quotations or, in
the event of equality, one of the highest and lowest quotations, for the most
recently issued direct noncallable fixed rate obligations of the United States
Treasury ("Treasury Notes") with an original maturity of approximately the
designated index maturity and a remaining term to maturity of not less than the
designated index maturity minus one year in a representative amount, (iv) if the
Administrator cannot obtain three Treasury Note quotations of the kind described
above in (iii), the Administrator will determine the CMT Rate to be the yield to
maturity based on the average of the secondary market bid rates for Treasury
Notes with an original maturity longer than the designated CMT index maturity
which have a remaining term to maturity closest to the designated CMT index
maturity and in a representative amount, as of approximately 3:30 p.m., New York
City time, on the relevant Interest Rate Determination Date of leading primary
United States government securities dealers in New York City. In selecting these
offered rates, the Administrator will request quotations from at least five such
securities dealers and will disregard the highest quotation (or if there is
equality, one of the highest) and the lowest quotation (or if there is equality,
one of the lowest). If two Treasury Notes with an original maturity longer than
the designated CMT index maturity have remaining terms to maturity that are
equally close to the designated CMT index maturity, the Administrator will
obtain quotations for the Treasury Note with the shorter remaining term to
maturity, (v) if three or four but not five leading primary United States
government securities dealers are quoting as described in the prior paragraph,
then the CMT Rate for the relevant Interest Rate Determination Date will be
based on the average of the bid rates obtained and neither the highest nor the
lowest of those quotations will be eliminated, or (vi) if fewer than three
leading primary United States government securities dealers selected by the
Administrator are quoting as described in (v) above, the CMT Rate will remain
the CMT Rate then in effect on that Interest Rate Determination Date.
"Code" means the Internal Revenue Code of 1986, as amended from time to
time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause of the
Indenture.
"Collection Account" means the account designated as such, established
and maintained pursuant to Section 2.3(f) of the Administration Agreement.
"Collection Account Initial Deposit" means $13,226,385.46.
"Collection Period" means, with respect to the first Distribution Date,
the period beginning on the Cutoff Date and ending on June 30, 2004, and with
respect to each subsequent Distribution Date, the Collection Period means the
three calendar months immediately following the end of the previous Collection
Period.
"Commercial Paper Rate" means, for any relevant Interest Rate
Determination Date prior to each Interest Rate Change Date, the Bond Equivalent
Yield shown below of the rate for 00-
Xxxxxxxx X-0-00
day commercial paper, as published in H.15(519) prior to 3:00 p.m., New York
City time, on that Interest Rate Determination Date under the heading
"Commercial Paper -- Financial". If the rate described above is not published in
H.15(519) by 3:00 p.m., New York City time, on that Interest Rate Determination
Date, unless the calculation is made earlier and the rate was available from
that source at that time, then the Commercial Paper Rate will be the Bond
Equivalent Yield of the rate on the relevant Interest Rate Determination Date,
for commercial paper having the index maturity specified on the Remarketing
Terms Determination Date, as published in H.15 Daily Update or any other
recognized electronic source used for displaying that rate under the heading
"Commercial Paper -- Financial". For purposes of the definition of "Commercial
Paper Rate", the "Bond Equivalent Yield" equals [(NxD)]/[360(Dx90)] times 100,
where "D" refers to the per annum rate determined as set forth above, quoted on
a bank discount basis and expressed as a decimal and "N" refers to 365 or 366,
as the case may be. If the rate described above cannot be determined, the
Commercial Paper Rate will remain the commercial paper rate then in effect on
that Interest Rate Determination Date. Unless otherwise specified on the
Remarketing Terms Determination Date, the Commercial Paper Rate will be subject
to a Lock-In Period of six Business Days.
"Commission" means the Securities and Exchange Commission.
"Consolidation Loans" means Student Loans made in accordance with the
Section 428C of the Higher Education Act.
"Corporate Trust Office" means (i) with respect to the Indenture
Trustee, the principal office of the Indenture Trustee at which at any
particular time its corporate trust business shall be administered, which office
at the Closing Date is located at 000 Xxxxxxx Xxxxxx 0 Xxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Trust Group (telephone: (000) 000-0000, facsimile:
(000) 000-0000) or at such other address as the Indenture Trustee may designate
from time to time by notice to the Noteholders and the Depositor, or the
principal corporate trust office of any successor Indenture Trustee (the address
of which the successor Indenture Trustee will notify the Noteholders, the
Administrator and the Depositor) and (ii) with respect to the Eligible Lender
Trustee, the principal corporate trust office of the Eligible Lender Trustee
located at Christiana Center/OPS4, 000 Xxxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx
00000, Attention: Corporate Trust Department (telephone: (000) 000-0000;
facsimile: (000) 000-0000); or at such other address as the Eligible Lender
Trustee may designate by notice to the Depositor, or the principal corporate
trust office of any successor Eligible Lender Trustee (the address of which the
successor Eligible Lender Trustee will notify the Administrator and the
Depositor).
"Currency Swap Agreement" means with respect to any class of Reset Rate
Notes in Foreign Exchange Mode, each Swap Agreement between the Trust and the
related Currency Swap Counterparty which (i) converts the secondary market trade
proceeds into U.S. Dollars received on the effective date of such Swap Agreement
(or, with respect to the Initial Currency Swap Agreement, converts all proceeds
on the Closing Date from the sale of each class of Reset Rate Notes to U.S.
Dollars); (ii) converts all principal payments in U.S. Dollars by the Trust to
the related class of Reset Rate Noteholders into the applicable currency; (iii)
converts the interest rate on any class of Reset Rate Notes from a LIBOR-based
rate to a fixed or floating rate payable in the applicable currency; (iv)
converts the U.S. Dollar equivalent of all secondary market trade proceeds
received on the related Reset Date resulting in the successful remarketing of a
class of
Appendix A-2-15
Reset Rate Notes or the exercise of a Call Option into the applicable currency
for the payment of principal to the tendering Reset Rate Noteholders; and (v)
pays to the Paying Agent, on behalf of the Trust, for the benefit of the
tendering Reset Rate Noteholders, the required amount of additional interest at
the interest rate applicable to the tendered Reset Rate Notes resulting from any
required delay in Reset Date payments through Euroclear and Clearstream.
"Currency Swap Counterparty" means each Eligible Swap Counterparty that
is a party, in its capacity as swap counterparty, to the related Currency Swap
Agreement.
"Custodian" has the meaning specified in Section 2.1 of the Indenture.
"Cutoff Date" means February 27, 2004.
"Day Count Basis" means 30/360, Actual/360, Actual/365 (Fixed),
Actual/Actual (accrual basis), Actual/Actual (ISMA) or Actual/Actual (payment
basis), as applicable, or any other day count basis set forth in the Remarketing
Terms Notice.
"Default" means any occurrence that is, or with notice or the lapse of
time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.10 of the
Indenture.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12, Part V of
the Delaware Code, entitled "Treatment of Delaware Statutory Trusts".
"Delivery" when used with respect to Trust Account Property means:
(a) with respect to bankers' acceptances, commercial
paper, negotiable certificates of deposit and other obligations that constitute
"instruments" within the meaning of Section 9-102(a)(47) of the UCC and are
susceptible of physical delivery, transfer thereof to the Indenture Trustee or
its nominee or custodian by physical delivery to the Indenture Trustee or its
nominee or custodian endorsed to, or registered in the name of, the Indenture
Trustee or its nominee or custodian or endorsed in blank, and, with respect to a
certificated security (as defined in Section 8-102(a)(3) of the UCC) transfer
thereof (i) by delivery of such certificated security endorsed to, or registered
in the name of, the Indenture Trustee or its nominee or custodian or endorsed in
blank to a securities intermediary (as defined in Section 8-102(a)(14) of the
UCC) and the making by such securities intermediary of entries on its books and
records identifying such certificated securities as belonging to the Indenture
Trustee or its nominee or custodian and the sending by such securities
intermediary of a confirmation of the purchase of such certificated security by
the Indenture Trustee or its nominee or custodian, or (ii) by delivery thereof
to a "clearing corporation" (as defined in Section 8-102(a)(5) of the UCC) and
the making by such clearing corporation of appropriate entries on its books
reducing the appropriate securities account of the transferor and increasing the
appropriate securities account of a securities intermediary by the amount of
such certificated security, the identification by the clearing corporation of
the certificated securities for the sole and exclusive account of the securities
intermediary, the maintenance of such certificated securities by such clearing
corporation or the nominee of either subject to the clearing corporation's
exclusive control, the sending of a confirmation by the securities intermediary
of the purchase by the Indenture Trustee or its
Appendix A-2-16
nominee or custodian of such securities and the making by such securities
intermediary of entries on its books and records identifying such certificated
securities as belonging to the Indenture Trustee or its nominee or custodian
(all of the foregoing, but not including Trust Student Loans, "Physical
Property"); and such additional or alternative procedures as may hereafter
become appropriate to effect the complete transfer of ownership of any such
Trust Account Property to the Indenture Trustee or its nominee or custodian,
consistent with changes in applicable law or regulations or the interpretation
thereof;
(b) with respect to any security issued by the U.S.
Treasury, the Government National Mortgage Association, the Federal Home Loan
Mortgage Corporation or the Federal National Mortgage Association that is a
book-entry security held at a Federal Reserve Bank pursuant to Federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable Federal regulations and Articles 8 and 9 of
the UCC: the crediting of such book-entry security to an appropriate book-entry
account of the Indenture Trustee or its nominee or the custodian or securities
intermediary at a Federal Reserve Bank, causing the custodian to continuously
indicate by book-entry such book-entry security as credited to the relevant
book-entry account, the continuous crediting of such book-entry security to a
securities account of the custodian at such Federal Reserve Bank and the
continuous identification of such book-entry security by the custodian as
credited to the appropriate book-entry account; and
(c) with respect to any item of Trust Account Property
that is an uncertificated security under Article 8 of the UCC and that is not
governed by clause (b) above, registration on the books and records of the
issuer thereof in the name of the securities intermediary, the sending of a
confirmation by the securities intermediary of the purchase by the Indenture
Trustee or its nominee or custodian of such uncertificated security, the making
by such securities intermediary of entries on its books and records identifying
such uncertificated certificates as belonging to the Indenture Trustee or its
nominee or custodian.
"Department" means the United States Department of Education, an agency
of the Federal government.
"Depositor" means SLM Funding LLC, a Delaware limited liability
company, and its successors and assigns, including for such purpose, a permitted
transferee of all of SLM Funding LLC's right, title and interest in the Excess
Distribution Certificate.
"Depository Agreements" means the Note Depository Agreements.
"Determination Date" means, with respect to the Collection Period
preceding any Distribution Date, the first Business Day preceding such
Distribution Date.
"Distribution Date" means for any class of Notes, the 25th day of each
of January, April, July and October, or, if such day is not a Business Day, the
immediately following Business Day, commencing July 26, 2004.
"DTC" means the Depository Trust Company, or any successor thereto.
Appendix A-2-17
"Eligible Deposit Account" means (i) with respect to the Trust Accounts
other than the Pounds Sterling Account or any Other Currency Account, either (a)
a segregated account with an Eligible Institution or (b) a segregated trust
account with the corporate trust department of a depository institution
organized under the laws of the United States of America or any one of the
States or the District of Columbia (or any domestic branch of a foreign bank),
having corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the securities of such depository institution have a
credit rating from Xxxxx'x, S&P, and, if such institution is rated by Fitch,
Fitch, in one of their generic rating categories which signifies investment
grade and (ii) with respect to the Pounds Sterling Account or any Other Currency
Account, a segregated account with the London Paying Agent.
"Eligible Institution" means a depository institution organized under
the laws of the United States of America or any one of the States or the
District of Columbia (or any domestic branch of a foreign bank) (i) which has
(A) either a long-term senior unsecured debt rating of "AAA" or a short-term
senior unsecured debt or certificate of deposit rating of "A-1+" or better by
S&P and (B)(1) a long-term senior unsecured debt rating of "A1" or better and
(2) a short-term senior unsecured debt rating of "P-1" or better by Xxxxx'x, and
(C) if such institution is rated by Fitch, a long-term senior unsecured debt
rating of "AA" or a short-term senior unsecured debt rating of "F1+", or any
other long-term, short-term or certificate of deposit rating with respect to
which the Rating Agency Condition has been satisfied and (ii) whose deposits are
insured by the FDIC. If so qualified, the Eligible Lender Trustee or the
Indenture Trustee may be considered an Eligible Institution.
"Eligible Investments" means book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully
guaranteed as to timely payment by, the United States of America, the Government
National Mortgage Association, the Federal Home Loan Mortgage Corporation, the
Federal National Mortgage Association, SLMA, or any agency or instrumentality of
the United States of America the obligations of which are backed by the full
faith and credit of the United States of America; provided that obligations of,
or guaranteed by, the Government National Mortgage Association, the Federal Home
Loan Mortgage Corporation, the Federal National Mortgage Association or SLMA
shall be Eligible Investments only if, at the time of investment, they meet the
criteria of each of the Rating Agencies for collateral for securities having
ratings equivalent to the respective ratings of the Notes in effect at the
Closing Date;
(b) demand deposits, time deposits or certificates of
deposit of any depository institution or trust company incorporated under the
laws of the United States of America or any State (or any domestic branch of a
foreign bank) and subject to supervision and examination by Federal or state
banking or depository institution authorities (including depository receipts
issued by any such institution or trust company as custodian with respect to any
obligation referred to in clause (a) above or portion of such obligation for the
benefit of the holders of such depository receipts); provided that at the time
of the investment or contractual commitment to invest therein (which shall be
deemed to be made again each time funds are reinvested following each
Distribution Date), the commercial paper or other short-term senior unsecured
debt obligations (other than such obligations the rating of which is based on
the credit of a Person other than such
Appendix A-2-18
depository institution or trust company) thereof shall have a credit rating from
each of the Rating Agencies in the highest investment category granted thereby;
(c) commercial paper having, at the time of the
investment, a rating from each of the Rating Agencies in the highest investment
category granted thereby;
(d) investments in money market funds having a rating
from each of the Rating Agencies in the highest investment category granted
thereby (including funds for which the Indenture Trustee, the Administrator or
the Eligible Lender Trustee or any of their respective Affiliates is investment
manager or advisor);
(e) bankers' acceptances issued by any depository
institution or trust company referred to in clause (b) above;
(f) repurchase obligations with respect to any security
that is a direct obligation of, or fully guaranteed by, the United States of
America or any agency or instrumentality thereof the obligations of which are
backed by the full faith and credit of the United States of America, in either
case entered into with a depository institution or trust company (acting as
principal) described in clause (b) above;
(g) asset-backed securities, including asset-backed
securities issued by Affiliates, or entities formed by Affiliates, of SLMA, but
excluding mortgage-backed securities, that at the time of investment have a
rating in the highest investment category granted by each of the Rating
Agencies; provided that the purchase price of any such asset-backed security in
excess of par must be paid for with amounts on deposit in the Investment Premium
Purchase Account;
(h) Eligible Repurchase Obligations; and
(i) any other investment which would not result in the
downgrading or withdrawal of any rating of the Notes by any of the Rating
Agencies as affirmed in writing delivered to the Indenture Trustee.
For purposes of the definition of "Eligible Investments" the phrase "highest
investment category" means (i) in the case of Fitch, "AAA" for long-term
investments (or the equivalent) and "F1+" for short-term investments (or the
equivalent), (ii) in the case of Xxxxx'x, "Aaa" for long-term investments (or
the equivalent) and "P-1" for short-term investments (or the equivalent), and
(iii) in the case of S&P, "AAA" for long-term investments (or the equivalent)
and "A-1+" for short-term investments (or the equivalent). A proposed investment
not rated by Fitch but rated in the highest investment category by Xxxxx'x and
S&P shall be considered to be rated by each of the Rating Agencies in the
highest investment category granted thereby.
"Eligible Lender Trustee" means Chase Manhattan Bank USA, National
Association, a national banking association, not in its individual capacity but
solely as Eligible Lender Trustee under the Trust Agreement. "Eligible Lender
Trustee" shall also mean each successor Eligible Lender Trustee as of the
qualification of such successor as Eligible Lender Trustee under the Trust
Agreement.
Appendix A-2-19
"Eligible Loans" has the meaning specified in any of the Purchase
Agreements or the Sale Agreement, as applicable.
"Eligible Repo Counterparty" means an institution that is an eligible
lender (under the Family Federal Family Education Loan Program) or that holds
Student Loans through an eligible lender trustee and whose short-term debt
ratings are not less than "P-1" by Xxxxx'x, "A-1" by S&P and "F1" by Fitch, if
rated by Fitch.
"Eligible Repurchase Obligations" means repurchase obligations with
respect to Student Loans serviced by the Servicer or an Affiliate thereof,
entered into with an Eligible Repo Counterparty, provided that the applicable
repurchase date shall occur no later than the Business Day prior to the next
Distribution Date.
"Eligible Swap Counterparty" means an entity, which may be an affiliate
of a Remarketing Agent, engaged in the business of entering into derivative
instrument contracts that satisfies the Rating Agency Condition.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EURIBOR" means, with respect to any Accrual Period, the Euro interbank
offered rate for deposits in Euros having a maturity of three months, commencing
on the first day of the Accrual Period, which appears on Telerate Page 248 as of
11:00 a.m. Brussels time, on the related EURIBOR Determination Date. If an
applicable rate does not appear on Telerate Page 248, the rate for that day will
be determined on the basis of the rates at which deposits in Euros, having the
applicable maturity and in a principal amount of not less than (euro)1,000,000,
are offered at approximately 11:00 a.m., Brussels time, on that EURIBOR
Determination Date, to prime banks in the Euro-zone interbank market by the
Reference Banks. The Administrator will request the principal Euro-zone office
of each Reference Bank to provide a quotation of its rate. If the Reference
Banks provide at least two quotations, the rate for that day will be the
arithmetic mean of the quotations. If the Reference Banks provide fewer than two
quotations, the rate for that day will be the arithmetic mean of the rates
quoted by major banks in the Euro-zone, selected by the Administrator, at
approximately 11:00 a.m. Brussels time, on that EURIBOR Determination Date, for
loans in Euros to leading European banks having the applicable maturity and in a
principal amount of not less than (euro)1,000,000. If the banks selected as
described above are not providing quotations, EURIBOR in effect for the
applicable Accrual Period will be EURIBOR for the specified maturity in effect
for the previous Accrual Period.
"EURIBOR Determination Date" means, for each Accrual Period, the day
that is two EURIBOR Settlement Days before the beginning of that Accrual Period.
"EURIBOR Settlement Day" means any day on which TARGET is open which is
also a day on which banks in New York City are open for business.
"Euroclear" means the Euroclear System, or any successor thereto.
"European Clearing Systems" means Euroclear or Clearstream.
"Event of Default" has the meaning specified in Section 5.1 of the
Indenture.
Appendix A-2-20
"Excess Distribution Certificate" means the certificate, substantially
in the form of Exhibit A to the Trust Agreement, evidencing the right to receive
payments thereon as set forth in Sections 2.8(p), 2.9(f) and 2.10(a)(ii) of the
Administration Agreement.
"Excess Distribution Certificate Paying Agent" means any paying agent
or co-paying agent appointed pursuant to Section 3.13(g) of the Trust Agreement,
which shall initially be the Indenture Trustee.
"Excess Distribution Certificate Register" and "Excess Distribution
Certificate Registrar" mean the register mentioned and the registrar appointed
pursuant to Section 3.13(c) of the Trust Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Executive Officer" means, with respect to any corporation, the Chief
Executive Officer, Chief Operating Officer, Chief Financial Officer, President,
any Executive Vice President, any Senior Vice President, any Vice President, the
Secretary or the Treasurer of such corporation; and with respect to any
partnership, any general partner thereof.
"Expenses" means any and all liabilities, obligations, losses, damages,
taxes, claims, actions and suits, and any and all reasonable costs, expenses and
disbursements (including reasonable legal fees and expenses) of any kind and
nature whatsoever which may at any time be imposed on, incurred by, or asserted
against the Eligible Lender Trustee or any of its officers, directors or agents
in any way relating to or arising out of the Trust Agreement, the other Basic
Documents, the Trust Estate, the administration of the Trust Estate or the
action or inaction of the Eligible Lender Trustee under the Trust Agreement or
the other Basic Documents.
"Extension Rate" means, for each Distribution Date following a Failed
Remarketing if a class of Reset Rate Notes is then in Foreign Exchange Mode, the
rate of interest payable to each related Currency Swap Counterparty, not to
exceed Three-Month LIBOR plus 0.75%, unless the Remarketing Agents, in
consultation with the Administrator, determine that market conditions or some
other benefit to the Trust requires a higher rate; provided that in such case
the Rating Agency Condition is satisfied. The initial Extension Rate for each
class of Reset Rate Notes under the Initial Currency Swap Agreements is
Three-Month LIBOR plus 0.75%.
"Failed Remarketing" means, on any Reset Date for a class of Reset Rate
Notes, the situation where:
(a) the Remarketing Agents, in consultation with the
Administrator, cannot establish one or more of the terms required to be set on
the Remarketing Terms Determination Date;
(b) the Remarketing Agents are unable to establish the
Spread or fixed rate on the Spread Determination Date;
(c) either the Remarketing Agents are unable to remarket
some or all of the tendered Reset Rate Notes at the Spread or fixed rate
established on the Spread Determination
Appendix A-2-21
Date, or any committed purchasers default on their purchase obligations and in
their sole discretion, the Remarketing Agents elect not to purchase those Reset
Rate Notes themselves;
(d) both classes of Reset Rate Notes are to be remarketed
on the same Reset Date and the terms of such remarketing include a change in
priority with respect to the right to receive principal payments, and the
Remarketing Agents are unable to remarket a class of Reset Rate Notes;
(e) the Remarketing Agents, in consultation with the
Administrator, are unable to obtain one or more Swap Agreements meeting the
required criteria, if applicable;
(f) any of the conditions specified in Section 8 of the
Remarketing Agreement are not satisfied; or
(g) any applicable Rating Agency Condition has not been
satisfied.
"Failed Remarketing Rate" means, for any Reset Period and any class of
Reset Rate Notes then denominated in U.S. Dollars, Three-Month LIBOR plus 0.75%;
and for any class of Reset Rate Notes while in Foreign Exchange Mode, as will be
determined on the Spread Determination Date pursuant to the terms of the related
Currency Swap Agreement (and for the initial Reset Rate for each class of Reset
Rate Notes, the Failed Remarketing Rate will be Three-Month GBP-LIBOR plus
0.55%).
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Funds Rate" means the rate set forth for such day opposite the
caption "Federal Funds (effective)" in the weekly statistical release designated
H.15(519), or any successor publication, published by the Board of Governors of
the Federal Reserve System. If such rate is not published in the relevant
H.15(519) for any day, the rate for such day shall be the arithmetic mean of the
rates for the last transaction in overnight Federal Funds arranged prior to 9:00
a.m. New York City time on that day by each of four leading brokers in such
transactions located in New York City selected by the Administrator. The Federal
Funds rate for each Saturday and Sunday and for any other that is not a Business
Day shall be the Federal Funds Rate for the preceding Business Day as determined
above.
"Fitch" means Fitch Inc., also known as Fitch Ratings, or any successor
rating agency.
"Five-Month GBP-LIBOR" see Three-Month GBP-LIBOR.
"Five-Month LIBOR" see Three-Month LIBOR.
"Floating Rate Class A Notes" means the Class A-1 Notes, the Class A-2
Notes, the Class A-3 Notes, the Class A-4 Notes and the Class A-5 Notes.
"Floating Rate Noteholder" means the Person in whose name a Floating
Rate Note is registered in the Note Register.
"Floating Rate Notes" means the Floating Rate Class A Notes and the
Class B Notes.
Appendix A-2-22
"Foreign Exchange Mode" means that a class of Reset Rate Notes is then
denominated in a currency other than U.S. Dollars during the related Reset
Period.
"Four-Month GBP-LIBOR" see Three-Month GBP-LIBOR.
"Four-Month LIBOR" see Three-Month LIBOR.
"GBP-LIBOR" means Three-Month GBP-LIBOR, Four-Month GBP-LIBOR or
Five-Month GBP-LIBOR, as applicable.
"GBP-LIBOR Determination Date" means, for each Accrual Period, the day
that is two GBP-LIBOR Settlement Days before the beginning of that Accrual
Period.
"GBP-LIBOR Settlement Day" means any day on which banks in both London
and New York City are open for business.
"Global Note Certificate" means a global note certificate representing
interests in the Reset Rate Notes offered and sold in reliance on Rule 144A or
Regulation S, as applicable.
"Grant" means mortgage, pledge, bargain, sell, warrant, alienate,
remise, release, convey, assign, transfer, create and xxxxx x xxxx upon and a
security interest in and right of set-off against, deposit, set over and confirm
pursuant to the Indenture. A Grant of the Collateral or of any other agreement
or instrument shall include all rights, powers and options (but none of the
obligations) of the Granting party thereunder, including the immediate and
continuing right to claim for, collect, receive and give receipt for principal
and interest payments in respect of the Collateral and all other moneys payable
thereunder, to give and receive notices and other communications, to make
waivers or other agreements, to exercise all rights and options, to bring
Proceedings in the name of the Granting party or otherwise and generally to do
and receive anything that the Granting party is or may be entitled to do or
receive thereunder or with respect thereto.
"Guarantee Agreement" means any agreement between any Guarantor and the
Eligible Lender Trustee providing for the payment by the Guarantor of amounts
authorized to be paid pursuant to the Higher Education Act to holders of
qualifying Student Loans guaranteed in accordance with the Higher Education Act
by such Guarantor.
"Guarantee Payment" means any payment made by a Guarantor pursuant to a
Guarantee Agreement in respect of a Trust Student Loan.
"Guarantor" means any entity listed on Attachment B (as amended from
time to time) to the Sale Agreement.
"H.15(519)" means the weekly statistical release designated as such, or
any successor publication, published by the Board of Governors of the United
States Federal Reserve System.
"H.15 Daily Update" means the daily update for H.15(519), available
through the world wide web site of the Board of Governors of the Federal Reserve
System at xxxx://xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxx/x00/xxxxxx, or any successor
site or publications.
Appendix A-2-23
"Higher Education Act" means the Higher Education Act of 1965, as
amended, together with any rules, regulations and interpretations thereunder.
"Hold Notice" means a written statement (or an oral statement confirmed
in writing, which may be by e-mail) from a holder or beneficial owner of Reset
Rate Notes denominated in U.S. Dollars during the then-current and immediately
following Reset Periods, delivered to a Remarketing Agent that such holder or
beneficial owner desires to hold its Reset Rate Notes for the upcoming Reset
Period and affirmatively agrees to receive a rate of interest of not less than
the applicable All Hold Rate during that Reset Period.
"Indenture" means the Indenture, dated as of March 1, 2004, among the
Eligible Lender Trustee on behalf of the Trust, the Trust and the Indenture
Trustee.
"Indenture Trust Estate" means all money, instruments, rights and other
property that are subject or intended to be subject to the lien and security
interest of the Indenture for the benefit of the Noteholders and, as applicable,
each Swap Counterparty (including all Collateral Granted to the Indenture
Trustee), including all proceeds thereof.
"Indenture Trustee" means The Bank of New York, a New York banking
corporation, not in its individual capacity but solely as trustee under the
Indenture.
"Independent" means, when used with respect to any specified Person,
that the Person (a) is in fact independent of the Trust, any other obligor upon
the Notes, the Depositor and any Affiliate of any of the foregoing Persons, (b)
does not have any direct financial interest or any material indirect financial
interest in the Trust, any such other obligor, the Depositor or any Affiliate of
any of the foregoing Persons and (c) is not connected with the Trust, any such
other obligor, the Depositor or any Affiliate of any of the foregoing Persons as
an officer, employee, promoter, underwriter, placement agent, trustee, partner,
director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.1 of the
Indenture, made by an Independent appraiser or other expert appointed by an
Issuer Order and approved by the Indenture Trustee in the exercise of reasonable
care, and such opinion or certificate shall state that the signer has read the
definition of "Independent" in the Indenture and that the signer is Independent
within the meaning thereof.
"Index" or "Indices" means LIBOR, GBP-LIBOR, EURIBOR, a Commercial
Paper Rate, the CMT Rate, the Federal Funds Rate, the 91-day Treasury Xxxx Rate,
the Prime Rate or any other interest rate index specified in Schedule A to the
Reset Rate Notes.
"Index Maturity" means, with respect to any Accrual Period, the
interval between Interest Rate Change Dates for each applicable Index during
such Accrual Period, commencing on the first day of that Accrual Period.
"Initial Accrual Rate" means for each class of Notes and the Accrual
Period commencing on the Closing Date to, but excluding, the first Distribution
Date, the rate per annum as determined on the related Determination Date, as
follows:
Appendix A-2-24
X + [7/30 * (Y - X)]
where:
X = Four-Month LIBOR or Four-Month GBP-LIBOR, and
Y = Five-Month LIBOR or Five-Month GBP-LIBOR.
"Initial Currency Swap Agreements" means two initial Currency Swap
Agreements, each dated as of March 10, 2004, relating to the Reset Rate Notes
and each between the Trust and the Initial Currency Swap Counterparty.
"Initial Currency Swap Counterparty" means Swiss Re Financial Products
Corporation, and any successors or permitted assigns.
"Initial Pounds Sterling Exchange Rate" means an exchange rate of
$1.8110 equal to(pound)1.00
"Initial Pool Balance" means the Pool Balance as of the Cutoff Date,
which is $3,006,514,428.
"Initial Purchasers" means, collectively, Banc of America Securities
Limited, Citigroup Global Markets Limited, Credit Suisse First Boston (Europe)
Limited, Barclays Bank plc, Xxxxxxx Sachs International and Greenwich Capital
Markets, Inc.
"Initial Remarketing Agency Agreement" means each agreement,
substantially in the form of Appendix B to the Remarketing Agreement to be
entered into on each Remarketing Terms Determination Date (unless a Call Option
has been exercised) among the Remarketing Agents, the Administrator and the
Trust.
"Initial Reset Dates" means, for the Class A-6A Notes and Class A-6B
Notes, the Distribution Dates in October 2013 and January 2014, respectively.
"Initial Reset Date Notice" means the written notice delivered pursuant
to Section 3(a) of the Reset Rate Note Procedures.
"Insolvency Event" means, with respect to a specified Person, (a) the
filing of a decree or order for relief by a court having jurisdiction in the
premises in respect of such Person or any substantial part of its property in an
involuntary case under any applicable Federal or state bankruptcy, insolvency or
other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its property, or ordering the
winding-up or liquidation of such Person's affairs, which decree or order
remains unstayed and in effect for a period of 60 consecutive days; or (b) the
commencement by such Person of a voluntary case under any applicable Federal or
state bankruptcy, insolvency or other similar law now or hereafter in effect, or
the consent by such Person to the entry of an order for relief in an involuntary
case under any such law, or the consent by such Person to the appointment of or
taking possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official for such Person or for any substantial part of
its property, or the making by such Person of any general assignment for the
benefit of
Appendix A-2-25
creditors, or the failure by such Person generally to pay its debts as such
debts become due, or the taking of action by such Person in furtherance of any
of the foregoing.
"Interest Rate Cap Agreement" means the agreement between the Trust and
the Interest Rate Cap Swap Counterparty, dated March 10, 2004, documented under
a 1992 ISDA Master Agreement (Multicurrency-Cross Border), including the related
schedule and confirmation, providing for certain payments to the Trust, in the
amounts and under the conditions set forth therein, which will terminate in
accordance with its terms on or before the July 2005 Distribution Date.
"Interest Rate Cap Confirmation" means the confirmation executed under
the Interest Rate Cap Agreement, dated as of March 10, 2004, representing the
interest rate cap in a notional amount of $440,000,000.
"Interest Rate Cap Swap Counterparty" means Bank of America, N.A. and
any successors or permitted assigns.
"Interest Rate Change Date" means for each Accrual Period, the date or
dates, based on the applicable Index, on which the rate of interest for a class
of Reset Rate Notes bearing interest at a floating rate is to be reset.
"Interest Rate Determination Date" means, for each Accrual Period, and
(i) for the Reset Rate Notes that bear interest at a LIBOR or GBP-LIBOR-based
rate, the related LIBOR or GBP-LIBOR Determination Date, as applicable, or (ii)
for the Reset Rate Notes that bear interest at a floating rate that is not
LIBOR-based, the applicable date or dates set forth in the Remarketing Terms
Notice, on which the applicable rate of interest to be in effect as of the next
Interest Rate Change Date will be determined by the Administrator.
"Interest Rate Swap Agreement" means, with respect to any class of
Reset Rate Notes during any Reset Period when it is denominated in U.S. Dollars
and (i) bears a fixed rate of interest (or bears interest based on LIBOR or a
U.S. Commercial Paper Rate, if a Swap Agreement is to be entered into pursuant
to the Reset Rate Note Procedures), or (ii) bears interest based on an index
other than LIBOR or a U.S. Commercial Paper Rate, any Swap Agreement between the
Trust and an Eligible Swap Counterparty, to hedge the basis risk during the
related Reset Period.
"Interest Subsidy Payments" means payments, designated as such,
consisting of interest subsidies by the Department in respect of the Trust
Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Interim Eligible Lender Trustee" means Chase Manhattan Bank USA,
National Association, a national banking association, not in its individual
capacity but solely as Interim Eligible Lender Trustee under the Interim Trust
Agreement. "Interim Eligible Lender Trustee" shall also mean each successor
Interim Eligible Lender Trustee as of the qualification of such Interim Eligible
Lender Trustee under the Interim Trust Agreement.
"Interim Trust Agreement" means the Interim Trust Agreement, dated as
of March 1, 2004, between the Depositor and the Interim Eligible Lender Trustee.
Appendix A-2-26
"Interim Trust Loans" has the meaning set forth in the Interim Trust
Agreement.
"Investment Earnings" means, with respect to any Distribution Date, the
Investment Earnings (net of losses and investment expenses) on amounts on
deposit in the Trust Accounts to be deposited into the Collection Account on or
prior to such Distribution Date pursuant to Section 2.3(b) of the Administration
Agreement.
"Investment Premium Purchase Account" means each account designated as
such, established and maintained pursuant to Section 2.3(l) of the
Administration Agreement.
"Investment Premium Purchase Account Deposit Amount" means, with
respect to each Distribution Date when funds are deposited into an Accumulation
Account, an amount equal to 1.00% of the amount deposited into that Accumulation
Account on such Distribution Date.
"Investment Premium Purchase Account Release Amount" means, with
respect to any Distribution Date that is one year or less prior to a Reset Date
relating to a class of Reset Rate Notes for which funds are then on deposit in
an Accumulation Account, the amount, if any, to be withdrawn from the related
Investment Premium Purchase Account so that the remaining funds on deposit in
such Investment Premium Purchase Account will be equal to the lesser of (a)
1.00% of the amount on deposit in the related Accumulation Account, and (b) the
amount then on deposit the related Investment Premium Purchase Account; provided
that on any Distribution Date that is also a Reset Date for a class of Reset
Rate Notes for which amounts are then on deposit in an Accumulation Account, all
Investment Premium Purchase Account Deposit Amounts relating to such
Accumulation Account that remain on deposit in the related Investment Premium
Purchase Account will become part of the related Investment Premium Purchase
Account Release Amount on such Distribution Date.
"Investment Reserve Account" means each account designated as such,
established and maintained pursuant to Section 2.3(m) of the Administration
Agreement.
"Investment Reserve Account Required Amount" means, with respect to
each Distribution Date, immediately following the date when the ratings of any
Eligible Investment in an Accumulation Account has been downgraded by one or
more Rating Agencies, an amount (to the extent of Available Funds), to be set by
each applicable Rating Agency in satisfaction of the Rating Agency Condition
(but not to exceed the amount of the unrealized loss on the related Eligible
Investment).
"Issuer" means the Trust and, for purposes of any provision contained
in the Indenture and required by the TIA, each other obligor on the Notes.
"Issuer Order" and "Issuer Request" means a written order or request
signed in the name of the Issuer by any one of its Authorized Officers and
delivered to the Indenture Trustee.
"LIBOR" means Three-Month LIBOR, Four-Month LIBOR or Five-Month LIBOR,
as applicable.
"LIBOR Determination Date" means, for each Accrual Period, the second
Business Day before the beginning of that Accrual Period.
Appendix A-2-27
"Lien" means a security interest, lien, charge, pledge, equity or
encumbrance of any kind, other than tax liens and any other liens, if any, which
attach to the respective Trust Student Loan by operation of law as a result of
any act or omission by the related Obligor.
"Liquidated Student Loan" means any defaulted Trust Student Loan
liquidated by the Servicer (which shall not include any Trust Student Loan on
which Guarantee Payments are received) or which the Servicer has, after using
all reasonable efforts to realize upon such Trust Student Loan, determined to
charge off.
"Liquidation Proceeds" means, with respect to any Liquidated Student
Loan which became a Liquidated Student Loan during the current Collection Period
in accordance with the Servicer's customary servicing procedures, the moneys
collected in respect of the liquidation thereof from whatever source, other than
Recoveries, net of the sum of any amounts expended by the Servicer in connection
with such liquidation and any amounts required by law to be remitted to the
Obligor on such Liquidated Student Loan.
"Loan" has the meaning set forth in Section 2 of either Purchase
Agreement, as applicable.
"Lock-In Period" means a period from the first day of such Lock-In
Period (which may be expressed as a number of Business Days prior to a
Distribution Date) to the immediately succeeding Interest Payment Date during
which the interest rate, Index or other calculation in effect on the first day
of such Lock-In Period shall remain in effect for every day in such Lock-In
Period.
"London Paying Agent" means, with respect to any class of Reset Rate
Notes while in Foreign Exchange Mode, the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 of the Indenture and is authorized by the Eligible Lender Trustee
on behalf of the Trust to make the payments to and distributions from the Pounds
Sterling Account and any Other Currency Account and shall initially be The Bank
of New York London.
"Luxembourg Listing Agent" means, initially, The Bank of New York
(Luxembourg) S.A.
"Luxembourg Paying Agent" means, initially, The Bank of New York
(Luxembourg) S.A.
"Minimum Purchase Amount" means an amount that would be sufficient to
(i) reduce the Outstanding Amount of each class of Notes, less the amount on
deposit in any Accumulation Account with respect to the related class of Reset
Rate Notes, on such Distribution Date to zero and (ii) pay to the respective
Noteholders the Class A Noteholders' Interest Distribution Amount and the Class
B Noteholders' Interest Distribution Amount payable on such Distribution Date.
"Monthly Servicing Payment Date" means the 25th day of each calendar
month or, if such day is not a Business Day, the immediately following Business
Day, commencing on April 26, 2004.
Appendix A-2-28
"Moody's" means Xxxxx'x Investors Service, Inc., or any successor
rating agency.
"Non-U.S. Global Note Certificates" has the meaning specified in
Section 2.1 of the Indenture.
"Non-U.S. Rule 144 A Global Note Certificate" has the meaning specified
in Section 2.1 of the Indenture.
"Note" and "Notes" means any of the Floating Rate Notes and the Reset
Rate Notes.
"Note Depository Agreements" means with respect to the Notes, the
Letter of Representations, dated March 18, 2004, among the Trust, the Eligible
Lender Trustee and the Indenture Trustee in favor of DTC, and with respect to
the Reset Rate Notes, the Instruction Letter from Issuer to Common Depositary,
dated March 18, 2004 between the Trust and The Bank of New York Depository
(Nominees) Limited.
"Note Final Maturity Date" for a class of Notes means the Class A-1
Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity Date, the
Class A-4 Maturity Date, the Class A-5 Maturity Date, the Class A-6A Maturity
Date, the Class A-6B Maturity Date or the Class B Maturity Date, as applicable.
"Note Interest Shortfall" means the Class A Note Interest Shortfall, if
any, and/or the Class B Note Interest Shortfall, if any, as applicable.
"Note Owner" means, with respect to a Book-Entry Note, the Person who
is the owner of such Book-Entry Note, as reflected on the books of the
applicable Clearing Agency, or on the books of a Person maintaining an account
with such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such Clearing
Agency).
"Note Pool Factor" means, as of the close of business on a Distribution
Date, a seven-digit decimal figure equal to the Outstanding Amount of a class of
Notes divided by the original Outstanding Amount of such class of Notes. The
Note Pool Factor for each class will be 1.0000000 as of the Closing Date;
thereafter, the Note Pool Factor for each class will decline to reflect
reductions in the Outstanding Amount of that class of Notes.
"Note Purchase Agreement" means the Note Purchase Agreement dated as of
March 10, 2004, among the Depositor, the Seller and the Initial Purchasers.
"Note Rates" means, with respect to any Accrual Period, the Class A-1
Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the Class A-5
Rate, the Class A-6A Rate, the Class A-6B Rate and the Class B Rate for such
Accrual Period, collectively.
"Note Register" and "Note Registrar" have the respective meanings
specified in Section 2.4 of the Indenture.
"Noteholder" means a Floating Rate Noteholder, a Class A Noteholder, a
Reset Rate Noteholder or a Class B Noteholder, as the context requires.
Appendix A-2-29
"Notes" means the Class A-1 Notes, the Class A-2 Notes, the Class A-3
Notes, the Class A-4 Notes, the Class A-5 Notes, the Class A-6A Notes, the Class
A-6B Notes and the Class B Notes, collectively.
"Notice Date" means, for each class of Reset Rate Notes, 12:00 p.m.
(noon), New York City time, on the sixth day prior to the Reset Date for that
class.
"Obligor" on a Trust Student Loan means the borrower or co-borrowers of
such Trust Student Loan and any other Person who owes payments in respect of
such Trust Student Loan, including the Guarantor thereof and, with respect to
any Interest Subsidy Payment or Special Allowance Payment, if any, thereon, the
Department.
"Officers' Certificate" means (i) in the case of the Trust, a
certificate signed by any two Authorized Officers of the Eligible Lender
Trustee, under the circumstances described in, and otherwise complying with, the
applicable requirements of Section 11.1 of the Indenture, and delivered to the
Indenture Trustee, and (ii) in the case of the Depositor, the Administrator or
the Servicer, a certificate signed by any two Authorized Officers of the
Depositor, the Administrator or the Servicer, as applicable.
"Opinion of Counsel" means (i) with respect to the Trust, one or more
written opinions of counsel who may, except as otherwise expressly provided in
the Indenture, be employees of or counsel to the Eligible Lender Trustee, the
Trust, the Depositor or an Affiliate of the Depositor and who shall be
satisfactory to the Indenture Trustee, and which opinion or opinions shall be
addressed to the Indenture Trustee as Indenture Trustee, shall comply with any
applicable requirements of Section 11.1 of the Indenture and shall be in form
and substance satisfactory to the Indenture Trustee, and (ii) with respect to
the Depositor, the Administrator or the Servicer, one or more written opinions
of counsel who may be an employee of or counsel to the Depositor, the
Administrator or the Servicer, which counsel shall be acceptable to the
Indenture Trustee and the Eligible Lender Trustee.
"Origination Fee" means the origination fee payable to the Department
by the lender with respect to any Trust Student Loan made on or after October 1,
1993, equal to 0.50% of the initial principal balance of such loan.
"Other Currency Account" means each account designated as such,
established and maintained pursuant to Section 2.3(n) of the Administration
Agreement.
"Outstanding" means, as of the date of determination, all Notes
theretofore authenticated and delivered under the Indenture except:
(a) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(b) Notes, or portions thereof, for which payment has been
made to the applicable Noteholders in reduction of the outstanding principal
balance thereof or for which money in the necessary amount has been theretofore
deposited with the Indenture Trustee or any Paying Agent in trust for the
Noteholders thereof (excluding for such purpose any amounts on
Appendix A-2-30
deposit in the Accumulation Account); provided, however, that if such Notes are
to be redeemed, notice of such redemption has been duly given pursuant to the
Indenture; and
(c) Notes in exchange for or in lieu of other Notes which have
been authenticated and delivered pursuant to the Indenture unless proof
satisfactory to the Indenture Trustee is presented that any such Notes are held
by a bona fide purchaser; provided that in determining whether the Noteholders
of the requisite Outstanding Amount of the Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or under any other
Basic Document, Notes owned by the Trust, any other obligor upon the Notes, the
Depositor or any Affiliate of any of the foregoing Persons shall be disregarded
and deemed not to be Outstanding, except that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that a
Responsible Officer of the Indenture Trustee either actually knows to be so
owned or has received written notice thereof shall be so disregarded. Notes so
owned that have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Indenture Trustee the pledgee's
right so to act with respect to such Notes and that the pledgee is not the
Trust, any other obligor upon the Notes, the Depositor or any Affiliate of any
of the foregoing Persons.
"Outstanding Amount" means the aggregate principal balance of all the
Notes or the applicable class or classes of Notes, as the case may be,
Outstanding at the date of determination; provided, however, that if any class
of Reset Rate Notes is then in Foreign Exchange Mode, the Outstanding Amount
shall be based on the U.S. Dollar Equivalent Principal Amount of that class of
Reset Rate Notes.
"Paying Agent" means, with respect to the Notes (other than any class
of Reset Rate Notes denominated in a currency other than U.S. Dollars), the
Indenture Trustee or any other Person that meets the eligibility standards for
the Indenture Trustee specified in Section 6.11 of the Indenture and is
authorized by the Eligible Lender Trustee, on behalf of the Trust, to make the
payments to and distributions from the Collection Account and payments of
principal of and interest and any other amounts owing on the Notes on behalf of
the Trust. With respect to any class of Reset Rate Notes denominated in a
currency other than U.S. Dollars, Paying Agent means the London Paying Agent and
the Luxembourg Paying Agent.
"Person" means any individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust (including any beneficiary
thereof), unincorporated organization, limited liability company, limited
liability partnership or government or any agency or political subdivision
thereof.
"Physical Property" has the meaning assigned to such terms in the
definition of "Delivery" above.
"Pool Balance" for any date means the aggregate principal balance of
the Trust Student Loans on that date, including accrued interest that is
expected to be capitalized, as reduced by:
(a) all payments received by the Trust through that date from
borrowers, the Guarantors and the Department;
Appendix A-2-31
(b) all amounts received by the Trust through that date from
purchases of the Trust Student Loans by SLMA, SLM ELC, the Depositor, or the
Servicer;
(c) all Liquidation Proceeds and Realized Losses on the
Trust Student Loans liquidated through that date;
(d) the amount of any adjustments to balances of the
Trust Student Loans that the Servicer makes under the Servicing Agreement
through that date; and
(e) the amount by which Guarantor reimbursements of
principal on defaulted Trust Student Loans through that date are reduced from
100% to 98%, or other applicable percentage, as required by the risk sharing
provisions of the Higher Education Act.
"Pounds Sterling Account" means the account designated as
such, established and maintained pursuant to Section 2.3(n) of the
Administration Agreement.
"Predecessor Note" means, with respect to any particular Note, every
previous Note evidencing all or a portion of the same debt as that evidenced by
such particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.5 of the Indenture and in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.
"Primary Servicing Fee" for any Monthly Servicing Payment Date has the
meaning specified in Attachment A to the Servicing Agreement, and shall include
any such fees from prior Monthly Servicing Payment Dates that remain unpaid.
"Prime Rate" means, for any relevant Interest Rate Determination Date
prior to each Interest Rate Change Date, the prime rate or base lending rate on
that date, as published in H.15(519), prior to 3:00 p.m., New York City time, on
that Interest Rate Determination Date under the heading "Bank Prime Loan." The
Administrator will observe the following procedures if the Prime Rate cannot be
determined as described above: (i) if the rate described above is not published
in H.15(519) prior to 3:00 p.m., New York City time, on the relevant Interest
Rate Determination Date unless the calculation is made earlier and the rate was
available from that source at that time, then the Prime Rate will be the rate
for that Interest Rate Determination Date, as published in H.15 Daily Update or
another recognized electronic source for displaying such rate opposite the
caption "Bank Prime Loan", (ii) if the above rate is not published in either
H.15(519), H.15 Daily Update or another recognized electronic source for
displaying such rate by 3:00 p.m., New York City time, on the relevant Interest
Rate Determination Date, then the Administrator will determine the Prime Rate to
be the average of the rates of interest publicly announced by each bank that
appears on the Reuters screen designated as "USPRIME1" as that bank's prime rate
or base lending rate as in effect on that Interest Rate Determination Date,
(iii) if fewer than four rates appear on the Reuters screen USPRIME1 page on the
relevant Interest Rate Determination Date, then the Prime Rate will be the
average of the prime rates or base lending rates quoted, on the basis of the
actual number of days in the year divided by a 360-day year, as of the close of
business on that Interest Rate Determination Date by three major banks in New
York City selected by the Administrator, or (iv) if the banks selected by the
Appendix A-2-32
Administrator are not quoting as mentioned above, the Prime Rate will remain the
prime rate then in effect on that Interest Rate Determination Date.
"Principal Distribution Amount" means, (i) with respect to the initial
Distribution Date, the amount by which the sum of the Outstanding Amount of the
Notes exceeds the Adjusted Pool Balance for that Distribution Date, and (ii)
with respect to each subsequent Distribution Date, the sum of (a) the amount by
which the Adjusted Pool Balance for the preceding Distribution Date exceeds the
Adjusted Pool Balance for that Distribution Date, and (b) any amounts received
under the Interest Rate Cap Agreement for that Distribution Date.
"Proceeding" means any suit in equity, action at law or other judicial
or administrative proceeding.
"Purchase Agreements" means the SLMA Purchase Agreement and the SLM ELC
Purchase Agreement.
"Purchase Amount" with respect to any Trust Student Loan means the
amount required to prepay in full such Trust Student Loan under the terms
thereof including all accrued interest thereon.
"Purchased Student Loan" means a Trust Student Loan which is, as of the
close of business on the last day of a Collection Period, purchased by the
Servicer pursuant to Section 3.5 of the Servicing Agreement or repurchased by
the Depositor pursuant to Section 6 of the Sale Agreement, purchased by SLMA
pursuant to Section 6 of the SLMA Purchase Agreement or purchased by SLM ELC
pursuant to Section 6 of the SLM ELC Purchase Agreement.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A
under the Act.
"Quarterly Funding Amount" means, for each class of Reset Rate Notes,
for any Distribution Date that is (1) more than one year before the next related
Reset Date, zero and (2) one year or less before the next related Reset Date, an
amount to be deposited into the Remarketing Fee Account for the Reset Rate Notes
so that the amount therein in respect of that class equals the Quarterly
Required Amount for that class; provided, however, that if on any Distribution
Date that is not a Reset Date, the amount on deposit in the Remarketing Fee
Account in respect of that class is greater than the Quarterly Required Amount
for that class, such excess will be transferred to the Collection Account and
included in Available Funds for that Distribution Date.
"Quarterly Required Amount" means, for each class of Reset Rate Notes,
(1) on any related Reset Date, the Reset Period Target Amount for that class or
(2) on a Distribution Date that is one year or less before the next related
Reset Date (x) the Reset Period Target Amount for that class multiplied by (y) 5
minus the number of Distribution Dates remaining until the next Reset Date for
that class (excluding the current Distribution Date and including the next Reset
Date), divided by (z) five (5).
"Rating Agency" means Xxxxx'x, S&P and Fitch. If any such organization
or successor thereto is no longer in existence, "Rating Agency" with respect to
such organization shall be a nationally recognized statistical rating
organization or other comparable Person designated by
Appendix A-2-33
the Administrator, notice of which designation shall be given to the Indenture
Trustee, the Eligible Lender Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any intended action,
that each Rating Agency then rating a class of Notes shall have been given 10
days' prior written notice thereof and that each such Rating Agency shall have
notified the Administrator, the Servicer, the Eligible Lender Trustee, the
Indenture Trustee and the Remarketing Agents, if applicable, in writing that
such proposed action will not result in and of itself in the reduction or
withdrawal of its then-current rating of any class of Notes.
"Realized Loss" means the excess of the principal balance, including
any interest that had been or had been expected to be capitalized, of any
Liquidated Student Loan over Liquidation Proceeds for that Liquidated Student
Loan to the extent allocable to principal, including any interest that had been
or had been expected to be capitalized.
"Record Date" means, with respect to a Distribution Date or Redemption
Date and for each class of Notes, the close of business on the day preceding
such Distribution Date or Redemption Date.
"Recoveries" means moneys collected from whatever source with respect
to any Liquidated Student Loan which was written off in prior Collection Periods
or during the current Collection Period, net of the sum of any amounts expended
by the Servicer for the account of any Obligor and any amounts required by law
to be remitted to any Obligor.
"Redemption Date" means in the case of a payment to Noteholders
pursuant to Section 10.1 of the Indenture, the Distribution Date specified
pursuant to Section 10.1 of the Indenture.
"Redemption Price" means an amount equal to the Outstanding Amount of
the Notes, plus accrued and unpaid interest thereon at the applicable Note Rates
to but excluding the Redemption Date.
"Reference Banks" means, with respect to (i) LIBOR, four major banks in
the London interbank market for deposits in U.S Dollars selected by the
Administrator, (ii) GBP-LIBOR, four major banks in the London interbank market
for deposits in Pounds Sterling selected by the Administrator and (iii) EURIBOR,
four major banks in the Euro-zone interbank market selected by the
Administrator.
"Registrar" means the Excess Distribution Certificate Registrar and/or
the Note Registrar, as applicable.
"Regulation S" means Regulation S promulgated under the Act.
"Regulation S Global Note Certificate" has the meaning specified in
Section 2.1 of the Indenture.
"Remarketing Agency Agreement" means the collective reference to an
Initial Remarketing Agency Agreement and the Supplemental Remarketing Agency
Agreement.
Appendix A-2-34
"Remarketing Agent" means, initially, each of Banc of America
Securities LLC, Citigroup Global Markets Inc. and Credit Suisse First Boston
LLC. The Administrator, in its sole discretion, may change any Remarketing Agent
for the Reset Rate Notes for any Reset Period at any time on or before a
Remarketing Terms Determination Date.
"Remarketing Agreement" means the Remarketing Agreement dated as of
March 18, 2004 among the Remarketing Agents, the Administrator and the Trust, as
amended or supplemented from time to time.
"Remarketing Fee Account" means the account designated as such,
established and maintained pursuant to Section 2.3(i) of the Administration
Agreement.
"Remarketing Terms Determination Date" means, for a class of Reset Rate
Notes, not later than 3:00 p.m., New York City time, on the eighth Business Day
prior to the applicable Reset Date.
"Remarketing Terms Notice" means the notice delivered by the
Remarketing Agents to a class of Reset Rate Noteholders, the Indenture Trustee,
the Rating Agencies and the applicable Clearing Agencies on each Remarketing
Terms Determination Date containing the information set forth in the Reset Rate
Note Procedures (Appendix A-2 to the Indenture).
"Reserve Account" means the account designated as such, established and
maintained pursuant to Section 2.3(g) of the Administration Agreement.
"Reserve Account Initial Deposit" means $7,516,286.
"Reset Date" means a Distribution Date on which certain terms for a
class of Reset Rate Notes may be changed in accordance with the Reset Rate Note
Procedures (Appendix A-2 to the Indenture).
"Reset Period" means, with respect to any class of Reset Rate Notes, a
period of at least three months (or any other longer duration that is a multiple
of three months) that will always end on the day before a Distribution Date,
which such Distribution Date will be the next Reset Date; provided that no such
Reset Period may end after the day before the related Reset Rate Notes Maturity
Date.
"Reset Period Target Amount" means, for each class of Reset Rate Notes
and any Distribution Date that is (1) more than one year before the next related
Reset Date, zero, and (2) one year or less before the next related Reset Date,
the highest remarketing fee payable to the Remarketing Agents for that class of
Reset Rate Notes (not to exceed 0.35% of the maximum principal balance of such
class of Reset Rate Notes that could be remarketed) on the next related Reset
Date as determined by the Administrator based on the assumed weighted average
life of such class of Reset Rate Notes and the maximum remarketing fee set forth
on a schedule attached to the Remarketing Agreement, as such schedule may be
amended from time to time.
"Reset Rate Note" means any Class A-6A Notes or Class A-6B Notes, as
applicable.
"Reset Rate Note Procedures" means Appendix A-2 to the Indenture.
Appendix A-2-35
"Reset Rate Noteholder" means the Person in whose name a Reset Rate
Note is registered in the Note Register.
"Reset Rate Notes" means the Class A-6A Notes and Class A-6B Notes.
"Reset Rate Notes Maturity Date" means the Class A-6A Maturity Date or
Class A-6B Maturity Date, as applicable.
"Responsible Officer" means, with respect to the Indenture Trustee, any
officer within the Corporate Trust Office of the Indenture Trustee, including
any Vice President, Assistant Vice President, Assistant Treasurer, Assistant
Secretary, or any other officer of the Indenture Trustee customarily performing
functions similar to those performed by any of the above designated officers,
with direct responsibility for the administration of the Indenture and the other
Basic Documents on behalf of the Indenture Trustee and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject.
"Rule 144A" means Rule 144A promulgated under the Act.
"S&P" means Standard & Poor's Ratings Services, a division of The
XxXxxx-Xxxx Companies, Inc., or any successor rating agency.
"Sale Agreement" means the Sale Agreement Master Securitization Terms
Number 1000, dated as of March 18, 2004, among the Eligible Lender Trustee on
behalf of the Trust, the Trust, the Interim Eligible Lender Trustee and the
Depositor.
"Schedule of Trust Student Loans" means the listing of the Trust
Student Loans set forth in Schedule A to the Indenture and the Xxxx of Sale
(which Schedule may be in the form of microfiche).
"Schedule Replacement Order" means an Issuer Order replacing Schedule A
to each class of Reset Rate Notes to be delivered with respect to the related
Reset Date.
"Servicer" means Xxxxxx Xxx, Inc., in its capacity as servicer of the
Trust Student Loans, or any successor thereto in such capacity in accordance
with the Servicing Agreement.
"Servicer Default" means an event specified in Section 5.1 of the
Servicing Agreement.
"Servicer Distribution Date" has the meaning specified in the Servicing
Agreement.
"Servicer's Report" means any report of the Servicer delivered pursuant
to Section 3.1(a) of the Administration Agreement, substantially in the form
acceptable to the Administrator.
"Servicing Agreement" means the Servicing Agreement, dated as of March
18, 2004, among the Trust, the Eligible Lender Trustee, the Servicer, the
Administrator and the Indenture Trustee.
"Servicing Fee" has the meaning specified in Attachment A to the
Servicing Agreement.
Appendix A-2-36
"SLM ELC" means SLM Education Loan Corp.
"SLM ELC Purchase Agreement" means the Purchase Agreement Master
Securitization Terms Number 1000, dated as of March 18, 2004, among SLM ELC, the
Interim Eligible Lender Trustee and the Depositor.
"SLMA" means the Student Loan Marketing Association.
"SLMA Purchase Agreement" means the Purchase Agreement Master
Securitization Terms Number 1000, dated as of March 18, 2004, among SLMA, the
Interim Eligible Lender Trustee and the Depositor.
"Special Allowance Payments" means payments, designated as such,
consisting of effective interest subsidies by the Department in respect of the
Trust Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Specified Reserve Account Balance" means, for any Distribution Date,
the greater of:
(a) 0.25% of the Pool Balance as of the close of business on
the last day of the related Collection Period; and
(b) $4,509,771;
provided that in no event will that balance exceed the Outstanding Amount. For
these purposes, as to a class of Reset Rate Notes which then bears interest at a
fixed rate and is not structured to receive a payment of principal until the end
of the related Reset Period, the Outstanding Amount, or its U.S. Dollar
Equivalent Principal Amount, as applicable, of that class of Reset Rate Notes
will be reduced by any amounts (less any Investment Earnings) on deposit in the
related Accumulation Account for that class of Reset Rate Notes.
"Spread" means the percentage, determined by the Remarketing Agents on
the Spread Determination Date, with respect to a class of Reset Rate Notes that
is to bear a floating rate of interest, in excess of or below the applicable
interest rate Index that will be applicable to that class of Reset Rate Notes
during any Reset Period after the initial Reset Period so as to result in an
interest rate that, in the reasonable opinion of the Remarketing Agents, will
enable all of the tendered Reset Rate Notes of that class to be remarketed by
the Remarketing Agents at 100% of the Outstanding Amount thereof.
"Spread Determination Date" means, for any class of Reset Rate Notes,
not later than 3:00 p.m., New York City time, on the third Business Day prior to
the applicable Reset Date.
"Spread Determination Notice" means the notice delivered by the
Remarketing Agents to the Noteholders of a class of Reset Rate Notes, the
Indenture Trustee, the Rating Agencies, the Clearing Agencies and, if such class
of Reset Rate Notes is then listed on the Luxembourg Stock Exchange, the
Luxembourg Stock Exchange on each Spread Determination Date containing the
information set forth in the Reset Rate Note Procedures (Appendix A-2 to the
Indenture).
Appendix A-2-37
"State" means any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx xx Xxxxxxx
or the District of Columbia.
"Stepdown Date" means the earlier to occur of (i) the April 2009
Distribution Date or (ii) the first date on which no Class A Notes remain
Outstanding. For this purpose, the Outstanding Principal Balance of a class of
Reset Rate Notes will be deemed reduced by any amounts (other than Investment
Earnings) on deposit in any related Accumulation Account.
"Student Loans" means education loans to students and parents of
students under the Federal Family Education Loan Program.
"Successor Administrator" has the meaning specified in Section 3.7(e)
of the Indenture.
"Successor Servicer" has the meaning specified in Section 3.7(e) of the
Indenture.
"Supplemental Interest Account" means each account designated as such,
established and maintained pursuant to Section 2.3(k) of the Administration
Agreement.
"Supplemental Interest Account Deposit Amount" means, with respect to
any Distribution Date when a class of Reset Rate Notes is in fixed rate mode and
is not structured to receive a payment of principal until the end of the related
Reset Period, the lesser of:
(a) the product of:
(1) the difference between (x) the weighted average of the
LIBOR-based rates (as determined on the LIBOR Determination
Date immediately preceding that Distribution Date) that will
be payable by the Trust to the related Swap Counterparty on
the next Distribution Date, and (y) an assumed rate of
Investment Earnings that satisfies the Rating Agency
Condition,
(2) the amount on deposit in the related Accumulation Account
immediately after that Distribution Date, and
(3) the actual number of days from that Distribution Date to
the next Reset Date for that class of Reset Rate Notes,
divided by 360; and
(b) an amount that satisfies the Rating Agency Condition.
"Supplemental Remarketing Agency Agreement" means each agreement,
substantially in the form of Appendix C to the Remarketing Agreement to be
entered into on each Spread Determination Date (unless a Call Option has been
exercised or a Failed Remarketing has been declared) among the Remarketing
Agents, the Administrator and the Trust.
"Swap Agreement" means the applicable ISDA Master Agreement, and each
related swap schedule and/or Swap Confirmation with respect to: (i) the Initial
Currency Swap Agreement, (ii) each Currency Swap Agreement and each Interest
Rate Swap Agreement to be entered into from time to time by the Administrator or
the Eligible Lender Trustee in either case solely on behalf of the Trust and an
Eligible Swap Counterparty, pursuant to the terms and conditions set forth in
the Reset Rate Note Procedures, and (iii) the Interest Rate Cap Agreement.
Appendix A-2-38
"Swap Confirmation" means each swap confirmation relating to a Swap
Agreement.
"Swap Counterparty" means each Eligible Swap Counterparty from time to
time party to a Swap Agreement, the Initial Currency Swap Counterparty (with
respect to each Initial Currency Swap Agreement) and the Interest Rate Cap Swap
Counterparty (with respect to the Interest Rate Cap Agreement).
"Swap Interest Payments" means, with respect to each Distribution Date,
the amount payable to the related Swap Counterparty by the Trust as a quarterly
premium payment pursuant to the related Swap Agreement.
"Swap Payments" means, with respect to each Distribution Date, the
amount, if any, payable to a Swap Counterparty by the Trust for such date,
including amounts due and unpaid from prior Distribution Dates (other than Swap
Termination Payments), as specified in the applicable Swap Agreement.
"Swap Receipts" means, with respect to each Distribution Date, the
amount required to be received from the related Swap Counterparty by the Trust
for such date (other than Swap Termination Payments), as specified in the
related Swap Agreement.
"Swap Termination Date" means the date on which Swap Agreement
terminates in accordance with its terms, which with respect to any Initial
Currency Rate Swap Agreement is scheduled to be the Initial Reset Date for the
related class of Reset Rate Notes.
"Swap Termination Payments" shall have the meaning set forth in each
Swap Agreement.
"TARGET" means the Trans-European Automated Real-time Gross Settlement
Express Transfer System.
"Telerate Page 248" means the display page so designated on the
Moneyline Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices).
"Telerate Page 3750" means the display page so designated on the
Moneyline Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices).
"Telerate Page 7051" means the display page so designated on the
Moneyline Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices).
"Telerate Page 7052" means the display page so designated on the
Moneyline Telerate Service (or such other page as may replace that page on that
service for the purpose of displaying comparable rates or prices).
"Three-Month GBP-LIBOR", "Four-Month GBP-LIBOR" and "Five-Month
GBP-LIBOR" means, with respect to any Accrual Period, will be the London
interbank offered rate for deposits in Pounds Sterling having the specified
maturity commencing on the first day of the
Appendix A-2-39
Accrual Period, which appears on Telerate Page 3750 as of 11:00 a.m. London
time, on the related gbp-libor Determination Date. If an applicable rate does
not appear on Telerate Page 3750, the rate for that day will be determined on
the basis of the rates at which deposits in Pounds Sterling, having the
specified maturity and in a principal amount of not less than (pound)1,000,000,
are offered at approximately 11:00 a.m., London time, on that GBP-LIBOR
Determination Date, to prime banks in the London interbank market by the
Reference Banks. The Administrator will request the principal London office of
each Reference Bank to provide a quotation of its rate. If the Reference Banks
provide at least two quotations, the rate for that day will be the arithmetic
mean of the quotations. If the Reference Banks provide fewer than two
quotations, the rate for that day will be the arithmetic mean of the rates
quoted by prime banks in London, selected by the Administrator, at approximately
11:00 a.m. London time, on that GBP-LIBOR Determination Date, for loans in
Pounds Sterling to leading European banks having the specified maturity and in a
principal amount of not less than (pound)1,000,000. If the banks selected as
described above are not providing quotations, GPB-LIBOR in effect for the
applicable Accrual Period will be GBP-LIBOR for the specified maturity in effect
for the previous Accrual Period. For any GBP-LIBOR-based notes, interest due for
any Accrual Period always will be determined based on the actual number of days
elapsed in the Accrual Period over a 365-day year.
"Three-Month LIBOR," "Four-Month LIBOR" and "Five-Month LIBOR" means,
with respect to any Accrual Period, the London interbank offered rate for
deposits in U.S. Dollars having the Index Maturity which appears on Telerate
Page 3750 as of 11:00 a.m. London time, on the related LIBOR Determination Date.
If this rate does not appear on Telerate Page 3750, the rate for that day will
be determined on the basis of the rates at which deposits in U.S. Dollars,
having the Index Maturity and in a principal amount of not less than U.S.
$1,000,000, are offered at approximately 11:00 a.m., London time, on that LIBOR
Determination Date, to prime banks in the London interbank market by the
Reference Banks. The Administrator will request the principal London office of
each Reference Bank to provide a quotation of its rate. If the Reference Banks
provide at least two quotations, the rate for that day will be the arithmetic
mean of the quotations. If the Reference Banks provide fewer than two
quotations, the rate for that day will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Administrator, at
approximately 11:00 a.m., New York time, on that LIBOR Determination Date, for
loans in U.S. Dollars to leading European banks having the Index Maturity and in
a principal amount of not less than U.S. $1,000,000. If the banks selected as
described above are not providing quotations, LIBOR in effect for the applicable
Accrual Period will be LIBOR, for the specified maturity in effect for the
previous Accrual Period.
"Transfer" an offer, sale, pledge, transfer or other disposition of a
Note or any interest therein.
"Transfer Date" has the meaning specified in Section 5.2(a) of the
Administration Agreement.
"Treasury Regulations" means regulations, including proposed or
temporary regulations, promulgated under the Code. References in any document or
instrument to specific provisions of proposed or temporary regulations shall
include analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
Appendix A-2-40
"Trigger Event" means, on any Distribution Date while any of the Class
A Notes are outstanding, the Outstanding Amount of the Notes, less any amounts
(other than Investment Earnings) on deposit in any Accumulation Account, after
giving effect to distributions to be made on that Distribution Date, would
exceed the Adjusted Pool Balance as of the end of the related Collection Period.
"Trust" means SLM Student Loan Trust 2004-3, a Delaware statutory trust
established pursuant to the Trust Agreement.
"Trust Account Property" means the Trust Accounts, all cash and
investments held from time to time in any Trust Account (whether in the form of
deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), including the Reserve Account Initial Deposit, the
Capitalized Interest Account Initial Deposit, the Collection Account Initial
Deposit and all earnings on and proceeds of the foregoing.
"Trust Accounts" has the meaning specified in Section 2.3(b) of the
Administration Agreement.
"Trust Agreement" means the short-form trust agreement, dated as of
March 5, 2004, between the Depositor and the Eligible Lender Trustee, as amended
and restated pursuant to an amended and restated Trust Agreement, dated as of
March 18, 2004 among the Depositor, the Eligible Lender Trustee and the
Indenture Trustee.
"Trust Auction Date" has the meaning specified in Section 4.4 of the
Indenture.
"Trust Estate" means all right, title and interest of the Trust (or the
Eligible Lender Trustee on behalf of the Trust) in and to the property and
rights sold, transferred and assigned to the Trust pursuant to the Sale
Agreement, all funds on deposit from time to time in the Trust Accounts and all
other property of the Trust from time to time, including any rights of the
Eligible Lender Trustee and the Trust pursuant to the Trust Agreement, the
Administration Agreement, the Servicing Agreement, any Swap Agreements and any
Eligible Repurchase Obligations.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939 as
in force on the date hereof, unless otherwise specifically provided.
"Trust Student Loan" means any student loan that is listed on the
Schedule of Trust Student Loans on the Closing Date, plus any student loan that
is permissibly substituted for a Trust Student Loan by the Depositor pursuant to
Sections 6 of the Sale Agreement or by the Servicer pursuant to Section 3.5 of
the Servicing Agreement, but shall not include any Purchased Student Loan
following receipt by or on behalf of the Trust of the Purchase Amount with
respect thereto or any Liquidated Student Loan following receipt by or on behalf
of the Trust of Liquidation Proceeds with respect thereto or following such
Liquidated Student Loan having otherwise been written off by the Servicer.
"Trust Student Loan Files" means the documents specified in Section 2.1
of the Servicing Agreement.
Appendix A-2-41
"UCC" means, unless the context otherwise requires, the Uniform
Commercial Code, as in effect in the relevant jurisdiction, as amended from time
to time.
"U.S. Dollar Equivalent Principal Amount" means, with respect to any
class of Reset Rate Notes while in Foreign Exchange Mode, the U.S. Dollar
equivalent of the Outstanding Amount of such class of Reset Rate Notes in
Foreign Exchange Mode as of the date of determination based on the exchange rate
provided in the related Currency Swap Agreement.
"U.S. Global Note Certificate" has the meaning specified in Section 2.1
of the Indenture.
Appendix X-0-00
XXXXXXXX X-0
RESET RATE NOTE PROCEDURES
Section 1. Definitions: All terms which are defined in Appendix A-1
shall have the same meanings in this Appendix A-2.
Section 2. Interest Rates; Principal Payments: (a) Each class of Reset
Rate Notes will bear interest for each related Reset Period at the rate set
forth on Schedule A attached to the related Reset Rate Note as determined in
accordance with Section 2(b) below; provided that during each initial Reset
Period, each class of Reset Rate Notes will bear interest from the Closing Date
through and including the related Initial Reset Date at the rate set forth in
the first sentence of the definitions of "Class A-6A Rate" and "Class A-6B
Rate," respectively. Interest on each class of Reset Rate Notes shall be payable
by the Trust with respect to each Distribution Date at the priority level set
forth in Section 2.8(d) of the Administration Agreement; provided that if
interest due to a class of Reset Rate Notes is payable through a Swap Agreement,
the related Swap Interest Payments will be payable by the Trust to the related
Swap Counterparty, and by the Swap Counterparty to the Trust (for payment to the
related Reset Rate Noteholders), as described in Section 10 below.
(b) After each initial Reset Period, either class of Reset Rate Notes
may be reset to bear either a fixed or floating rate of interest at the option
of the Remarketing Agents, in consultation with the Administrator. The interest
rate of each class of Reset Rate Notes will be reset as of each related Reset
Date as determined by (i) the Remarketing Agents, in consultation with the
Administrator, with respect to (A) the length of the related Reset Period, (B)
whether the rate is fixed or floating and (x) if floating, the applicable Index,
or (y) if fixed, the applicable pricing benchmark, (C) the applicable Day Count
Basis, (D) the applicable currency denomination, i.e., U.S. Dollars, Euros,
Pounds Sterling or another non-U.S. Dollar currency, (E) if in Foreign Exchange
Mode, the applicable Distribution Dates on which interest will be paid to the
related Reset Rate Noteholders, if other than quarterly, (F) the applicable
Interest Rate Determination Dates within each Accrual Period, (G) the interval
between Interest Rate Change Dates during each Accrual Period and (H) if
applicable, the related All Hold Rate, and (ii) the Remarketing Agents (in their
sole determination) with respect to the setting of the (A) fixed rate of
interest or (B) Spread to the chosen Index, as applicable.
(c) In the event that any class of Reset Rate Notes is reset (i) to
bear (or continue to bear) interest at a floating rate, (ii) to bear (or
continue to bear) a fixed rate of interest and/or (iii) to be denominated (or
continue to be denominated) in a currency other than U.S. Dollars, and the
Remarketing Agents, in consultation with the Administrator determine that it
would be in the best interest of the Trust based on existing market conditions
to enter into one or more Swap Agreements, the Administrator will be responsible
for arranging, on behalf of the Trust, one or more Swap Agreements to hedge the
basis risk and/or currency exchange risk (as applicable) and, together with the
Remarketing Agents, for selecting the Swap Counterparties thereto in accordance
with the procedures set forth in Section 10(d) below. No class of Reset Rate
Notes will be reset (or continue) to bear interest at a floating rate that is
not based on LIBOR or a Commercial Paper Rate, at a fixed rate or to be
denominated in a currency other than U.S. Dollars unless one or more Swap
Agreements are entered into as of the related Reset Date that
Appendix A-2-1
results in the Rating Agency Condition being satisfied. In connection with each
Swap Agreement, the Remarketing Agents shall solicit bids from Eligible Swap
Counterparties in accordance with the procedures set forth in Section 10(d)
below.
(d) Each class of Reset Rate Notes that bears interest at (i) a
floating rate shall be entitled to receive payments of principal in reduction of
its Outstanding Amount on each Distribution Date at the priority level set forth
in Section 2.8(f) of the Administration Agreement and (ii) a fixed rate shall be
entitled to receive allocations of principal at the priority level set forth in
Section 2.8(f) of the Administration Agreement on each Distribution Date;
provided, however, that such amounts referred to in this clause (ii) shall not
be paid in reduction of the Outstanding Amount of such class of Reset Rate Notes
if such class is structured not to receive a payment of principal until the end
of its Reset Period; instead all such amounts shall be deposited into the
related Accumulation Account for payment to the related Reset Rate Noteholders
or the related Currency Swap Counterparty, as applicable, on or about the next
Reset Date as set forth in Section 11(a) below.
Section 3. End of Reset Period Notice: (a) Unless the holder of the
related Call Option has delivered the related Call Option Notice, the
Administrator, not less than fifteen nor more than thirty calendar days prior to
any Remarketing Terms Determination Date, will (i) give written notice
(including facsimile or other electronic transmission, if permitted pursuant to
the recipient's standard procedures) to the applicable Clearing Agencies and the
Luxembourg Stock Exchange (for so long as the related class of Reset Rate Notes
is listed on such exchange), with a copy to the Indenture Trustee, notifying
them of the upcoming Reset Date and the identities of the related Remarketing
Agents and stating whether tender is deemed mandatory or optional for the
applicable class of Reset Rate Notes on the related Reset Date (the "Initial
Reset Date Notice"), (ii) request that each Clearing Agency notify its
participants of (1) the contents of the Initial Reset Date Notice, (2) the
Remarketing Terms Notice to be given on the Remarketing Terms Determination Date
pursuant to Section 4(d) below, (3) the Spread Determination Notice to be given
on the Spread Determination Date pursuant to Section 9(e) below, and (4) if
applicable, the procedures concerning the timely delivery of a Hold Notice
pursuant to Section 8 below that must be followed if any beneficial owner of a
class of Reset Rate Notes wishes to retain its Reset Rate Notes. For so long as
the related class of Reset Rate Notes is listed on the Luxembourg Stock
Exchange, a copy of such notices will be sent to the Luxembourg Stock Exchange
and each of the Remarketing Terms Notice and the Spread Determination Notice
will also be published in a leading newspaper having general circulation in
Luxembourg (which is expected to be The Luxemburger Wort) and (iii) initiate
discussions with representatives of the Luxembourg Stock Exchange regarding an
addendum to the Offering Memorandum dated March 10, 2004, if required by Section
7(f)(i) of the Remarketing Agreement.
(b) The Administrator will also include in each Initial Reset Date
Notice the names and contact information of the Luxembourg Listing Agent, if
applicable, and any Remarketing Agents confirmed or appointed by the
Administrator, or if no Remarketing Agents have then been so chosen, the
Administrator will provide adequate contact information for Reset Rate
Noteholders to receive information regarding the upcoming Reset Date.
(c) If the related Clearing Agency or its respective nominee, as
applicable, is no longer the holder of record of the related class of Reset Rate
Notes, the Administrator, or the
Appendix A-2-2
Remarketing Agents on its behalf, will send the related Reset Rate Noteholders,
with a copy to the Indenture Trustee and the Luxembourg listing agent, as
applicable, the required notices setting forth the information in Sections 3(a)
and 3(b) above not less than fifteen nor more than thirty calendar days prior to
any Remarketing Terms Determination Date. In addition, in the event that
Definitive Notes evidencing an interest in any class of Reset Rate Notes are
issued, the Administrator shall cause the Note Registrar to provide to the
relevant Reset Rate Noteholders and the Luxembourg listing agent, as applicable,
any additional procedures applicable to such Reset Rate Notes while in
definitive form.
Section 4. Remarketing Terms Determination Date: (a) Subject to the
provisions of the Remarketing Agreement, prior to the Remarketing Terms
Determination Date, and unless the holder of the related Call Option has
delivered the related Call Option Notice, the Administrator shall re-affirm the
capability of the initial Remarketing Agents to perform under the Remarketing
Agreement, and/or enter into new remarketing agreements with other or additional
remarketing agents, who shall function as the Remarketing Agents with respect to
the related Reset Date. On each Remarketing Terms Determination Date, the Trust,
the Administrator and the Remarketing Agents will enter into a Remarketing
Agency Agreement for the remarketing of the related class of Reset Rate Notes.
(b) If the Remarketing Agents, in consultation with the Administrator,
determine prior to the Remarketing Terms Determination Date that any Currency
Swap Agreements required pursuant to Section 2(c)(iii) above will not be
obtainable on the related Reset Date, the related class of Reset Rate Notes must
be denominated in U.S. Dollars during the next related Reset Period.
(c) Unless the holder of the related Call Option has delivered the
related Call Option Notice, on or prior to the Remarketing Terms Determination
Date the Remarketing Agents will notify the related Reset Rate Noteholders
whether tender is deemed mandatory or optional and, in consultation with the
Administrator, will establish the following terms for the related class of Reset
Rate Notes to be applicable during the immediately following related Reset
Period:
(i) the expected weighted average life of that class of Reset
Rate Notes, based on prepayment and other assumptions customary for
comparable securities;
(ii) the name and contact information of the Remarketing
Agents;
(iii) the next Reset Date and length of such Reset Period;
(iv) the interest rate mode (i.e., fixed rate or floating
rate);
(v) the currency denomination;
(vi) the applicable minimum denominations and additional
increments for such class of Reset Rate Notes;
(vii) if both classes of Reset Rate Notes are successfully
remarketed on the same Reset Date, whether there will be any change in
the relative priorities with respect to the right to receive payments
of principal;
Appendix A-2-3
(viii) if in Foreign Exchange Mode, the identities of the
Eligible Swap Counterparties from which bids will be solicited;
(ix) if in Foreign Exchange Mode, the applicable Distribution
Dates on which interest and principal will be paid to the related Reset
Rate Noteholders, if other than quarterly;
(x) if in fixed rate mode, whether the applicable class will
be structured to amortize periodically or to receive a payment of
principal only at the end of the r elated Reset Period;
(xi) if in floating rate mode, the applicable Index;
(xii) if in floating rate mode, the interval between Interest
Rate Change Dates;
(xiii) if in floating rate mode, the applicable Interest Rate
Determination Date;
(xiv) if in fixed rate mode, the applicable fixed rate pricing
benchmark;
(xv) if in fixed rate mode, the identities of the Eligible
Swap Counterparties from which bids will be solicited;
(xvi) if in floating rate mode, whether there will be a
related Swap Agreement and, if so, the identities of the Eligible Swap
Counterparties from which bids will be solicited;
(xvii) the applicable Day Count Basis;
(xviii) the related All Hold Rate, if applicable;
(xix) if Definitive Notes are to be issued, the procedures for
delivery and exchange of Definitive Notes and for dealing with lost or
mutilated notes; and
(xx) any other relevant terms incidental to the foregoing
(other than the related Spread or fixed rate of interest, as
applicable) for the next Reset Period;
provided that any interest rate mode, other than a floating rate based on LIBOR
or a Commercial Paper Rate, will require that the Rating Agency Condition be
satisfied prior to the delivery of the related Remarketing Terms Notice.
(d) The Remarketing Agents will communicate all of the information
established in Section 4(c) above in the Remarketing Terms Notice required to be
given in writing (including facsimile or other electronic transmission if in
accordance with each Clearing Agency's standard procedures) to each Clearing
Agency (and the Luxembourg Stock Exchange if the Reset Rate Notes are then
listed on such exchange) or the related Reset Rate Noteholders if Definitive
Notes have been issued, as applicable, the Indenture Trustee and the Rating
Agencies on the Remarketing Terms Determination Date.
Appendix A-2-4
(e) In addition, prior to the Remarketing Terms Determination Date, the
Administrator shall cause the Schedule Replacement Order with respect to the
related Reset Rate Notes to be delivered to the Indenture Trustee, the Clearing
Agencies and, if the related class of Reset Rate Notes is then listed on the
Luxembourg Stock Exchange, the Luxembourg listing agent.
Section 5. All Hold Rate: (a) On each Remarketing Terms Determination
Date for a class of Reset Rate Notes which is denominated in U.S. Dollars during
both the then-current Reset Period and the immediately following Reset Period,
the Remarketing Agents, in consultation with the Administrator, will establish
the related All Hold Rate for that class of Reset Rate Notes. With respect to
any class of Reset Rate Notes that is either in Foreign Exchange Mode during the
then-current Reset Period or will be reset into Foreign Exchange Mode on the
immediately following Reset Date, all related Reset Rate Noteholders will be
deemed to have tendered their Notes on the related Reset Date, regardless of any
desire by such Reset Rate Noteholders to retain their ownership thereof, and no
All Hold Rate will be applicable.
(b) The All Hold Rate will only be applicable if 100% of the Reset Rate
Noteholders of a class deliver timely Hold Notices wherein they elect to hold
their Reset Rate Notes for the next related Reset Period. If applicable, the
related interest rate for that class of Reset Rate Notes during the immediately
following Reset Period will not be less than the All Hold Rate. If the rate of
interest using the Spread or fixed rate of interest established on the Spread
Determination Date is higher than the All Hold Rate, then upon a successful
remarketing of the related class of Reset Rate Notes, all related Reset Rate
Noteholders who delivered a Hold Notice agreeing to be subject to the All Hold
Rate instead will be entitled to the higher rate of interest during the
immediately following Reset Period.
Section 6. Failed Remarketing: (a) With respect to each Reset Date for
which the holder of the related Call Option does not deliver the related Call
Option Notice, a Failed Remarketing will be declared by the Remarketing Agents
and the provisions of this Section 6 will apply if any of the conditions set
forth in the definition of "Failed Remarketing" are applicable. In order to
prevent the declaration of a Failed Remarketing, the Remarketing Agents will
have the option, but not the obligation, to purchase any Reset Rate Notes
tendered that they are not otherwise able to remarket or with respect to which a
committed purchaser defaults on their purchase obligations.
(b) At any time a Failed Remarketing is declared: (i) all related Reset
Rate Notes will be retained by the related Reset Rate Noteholders on the related
Reset Date, regardless of any deemed mandatory or voluntary tenders made to the
Remarketing Agents, (ii) the Failed Remarketing Rate for such class of Reset
Rate Notes will apply for the related Reset Period and (iii) a Reset Period of
three months will be established. In addition, if a class of Reset Rate Notes
are in Foreign Exchange Mode at the time a Failed Remarketing is declared, the
provisions of Sections 10(a)(i) and (ii) shall also apply.
(c) If there is a Failed Remarketing of a class of Reset Rate Notes,
the related Reset Rate Noteholders shall not be entitled to exercise any
remedies as a result of the failure of their class of Reset Rate Notes to be
remarketed on the related Reset Date.
Appendix A-2-5
Section 7. Call Option: (a) With respect to each Reset Date, the
Depositor, as the initial holder of the Excess Distribution Certificate, is
hereby granted a Call Option for the purchase of not less than 100% of the
related class of Reset Rate Notes, exercisable at a price equal to 100% of the
Outstanding Amount of that class of Reset Rate Notes, less all amounts
distributed to the related Reset Rate Noteholders as a payment of principal with
respect to the related Distribution Date(s), plus any accrued and unpaid
interest not paid by the Trust with respect to the applicable Reset Date.
(b) The Depositor, as the initial holder of the Excess Distribution
Certificate, effective as of the Closing Date, hereby transfers all of its right
title and interest in and to each Call Option to SLM Education Credit Finance
Corporation, which upon receipt thereof will dividend all of its right, title
and interest in and to each Call Option to SLM Corporation, and in acceptance of
such transfer SLM Corporation also hereby agrees to abide by all terms and
conditions hereunder with respect to each Call Option as set forth in these
Reset Rate Note Procedures.
(c) SLM Corporation may further transfer ownership of either Call
Option at any time to one of its Affiliates; provided that such permitted
transferee has at no time in the past owned, and is not obligated under either
the Purchase Agreements or the Sale Agreement to transfer, an interest in any of
the Trust Student Loans.
(d) A Call Option may be exercised with respect to the related class of
Reset Rate Notes at any time on or prior to the determination of the related
Spread or fixed rate or the declaration of a Failed Remarketing, as applicable,
on the related Spread Determination Date by delivery of a Call Option Notice;
provided that such Call Option may not be exercised before the day following the
last Distribution Date immediately preceding the next applicable Reset Date. In
addition, for so long as the related class of Reset Rate Notes is listed on the
Luxembourg Stock Exchange, the holder of the related Call Option shall cause a
notice of the exercise of the related Call Option to be published in a leading
newspaper having general circulation in Luxembourg (which is expected to be The
Luxemburger Wort). Once written notice of the exercise of a Call Option is
given, such exercise may not be rescinded.
(e) All amounts due and owing to the related Reset Rate Noteholders
shall be remitted on or before the related Reset Date by the holder of the
related Call Option in accordance with the standard procedures established by
the Clearing Agencies for transfer of securities to ensure timely payment of
principal to the related Reset Rate Noteholders on the related Reset Date.
(f) In the event that a Call Option is exercised with respect to a
class of Reset Rate Notes then in Foreign Exchange Mode, the holder of such Call
Option shall deliver the U.S. Dollar Equivalent Principal Amount remaining after
all payments of principal are made with respect to the related Distribution
Date, and interest (if applicable) owing to the Reset Rate Noteholders to the
Remarketing Agents for delivery to the Swap Counterparties to the related
Currency Swap Agreements, who shall exchange such amount into the applicable
currency for delivery to the related Reset Rate Noteholders; provided, however,
that if there are no such Currency Swap Agreements then in effect, the holder of
such Call Option shall remit all amounts due and owing to the Remarketing Agents
for delivery to the Reset Rate Noteholders in the
Appendix A-2-6
applicable currency on or before the Reset Date in accordance with the standard
procedures established by the related Clearing Agencies for transfer of
securities to ensure timely payment of principal to the related Reset Rate
Noteholders on the related Reset Date.
(g) If a Call Option is exercised with respect to any class of Reset
Rate Notes, (i) the interest rate on that class of Reset Rate Notes will be the
Call Rate, (ii) that class of Reset Rate Notes will be denominated in U.S.
Dollars and (iii) a Reset Period of three months will be established. At the end
of such three month Reset Period, the holder of the related Call Option may
either remarket the related class of Reset Rate Notes pursuant to the
remarketing procedures set forth herein and in the Remarketing Agreement, or
retain that class of Reset Rate Notes for one or more successive three-month
Reset Periods at the then-current Call Rate. In the event the holder of the
related Call Option chooses to remarket any class of Reset Rate Notes, such
holder shall be solely responsible for all costs and expenses relating to the
preparation of any new offering document and any other related costs and
expenses associated with such remarketing, other than the fees of the
Remarketing Agents, as more fully set forth in Section 3 of the Remarketing
Agreement.
(h) Other than in connection with the exercise of a Call Option,
neither SLM Corporation, SLMA, the Trust or any of their Affiliates shall have
the ability to purchase any Reset Rate Notes tendered to the Remarketing Agents.
Section 8. Hold Notice: For a class of Reset Rate Notes that is
denominated in U.S. Dollars during both the then-current Reset Period and the
immediately following Reset Period, the related Reset Rate Noteholders will have
the option to deliver a Hold Notice to any Remarketing Agent setting forth their
desire to hold their Reset Rate Notes for the next Reset Period at a rate of
interest not less than the All Hold Rate and on the terms set forth in the
related Remarketing Terms Notice, at any time on or after the Remarketing Terms
Determination Date until the Notice Date. Such Hold Notice may be delivered as
an oral statement to a Remarketing Agent, if subsequently confirmed in writing
within 24 hours, which confirmation may be in the form of an e-mail if timely
received by the Remarketing Agent. If a Reset Rate Noteholder does not timely
deliver a Hold Notice to a Remarketing Agent (such Hold Notice not to be
considered delivered until actually received by such Remarketing Agent), that
Reset Rate Noteholder will be deemed to have tendered for remarketing 100% of
the Outstanding Amount of its related class of Reset Rate Notes. Any duly
delivered Hold Notice will be irrevocable, but will be subject to a mandatory
tender of the applicable Reset Rate Notes pursuant to any exercise of the
related Call Option. All of the Reset Rate Notes of an applicable class, whether
tendered or not, will bear interest during any related Reset Period on the same
terms.
Section 9. Spread Determination Date: (a) On each Spread Determination
Date, unless a Failed Remarketing has been declared or the holder of the related
Call Option has delivered the related Call Option Notice, the Administrator, the
Trust and the Remarketing Agents will enter into a Supplemental Remarketing
Agency Agreement.
(b) If pursuant to the Remarketing Terms Notice, the Remarketing
Agents, in consultation with the Administrator, have determined that a class of
Reset Rate Notes is to be reset to bear a fixed rate of interest, then the
applicable fixed rate of interest for the corresponding Reset Period will be
determined on the Spread Determination Date by adding
Appendix A-2-7
(i) the applicable spread as determined by the Remarketing Agents on the Spread
Determination Date and (ii) the yield to maturity on the Spread Determination
Date of the applicable fixed rate pricing benchmark, selected by the Remarketing
Agents, as having an expected weighted average life based on a scheduled
maturity at the next Reset Date, which would be used in accordance with
customary financial practice in pricing new issues of asset-backed securities of
comparable average life; provided that such fixed rate of interest will in no
event be lower than the related All Hold Rate, if applicable. The Remarketing
Agents shall determine the applicable fixed rate of interest for such class of
Reset Rate Notes (by reference to the applicable fixed rate pricing benchmark
plus or minus the spread determined on the Remarketing Terms Determination Date)
on each Spread Determination Date irrespective of whether no remarketing will
occur as the result of the application of the All Hold Rate, if applicable. In
addition, on the related Spread Determination Date, the Remarketing Agents, in
consultation with the Administrator, shall determine the Supplemental Interest
Account Deposit Amount, if any, for that class of Reset Rate Notes.
(c) If pursuant to the Remarketing Terms Notice, the Remarketing
Agents, in consultation with the Administrator, have determined that a class of
Reset Rate Notes is to be reset to bear a floating rate of interest, then, on
the related Spread Determination Date, the Remarketing Agents will establish the
applicable Spread to be added or subtracted from the applicable Index; provided
that such floating rate of interest will in no event be lower than the related
All Hold Rate, if applicable.
(d) If required pursuant to Section 2(c) above, on the related Reset
Date the Trust shall enter into either (i) one or more Currency Swap Agreements,
if the related class of Reset Rate Notes is to be reset in Foreign Exchange
Mode, or (ii) one or more Interest Rate Swap Agreements if the related class of
Reset Rate Notes is to be reset in U.S. Dollars and to bear interest at a fixed
rate or at a floating rate other than one based on LIBOR or a Commercial Paper
Rate, with an Eligible Swap Counterparty.
(e) On or immediately following the Spread Determination Date, the
Remarketing Agents will communicate in writing (including facsimile or other
electronic transmission if in accordance with each Clearing Agency's standard
procedures) the contents of the Spread Determination Notice to each Clearing
Agency (and the Luxembourg Stock Exchange if the related class of Reset Rate
Notes is then listed on such exchange) or the Reset Rate Noteholders if
Definitive Notes have been issued, as applicable, with instructions to
distribute such notices to its related participants, or to the related Reset
Rate Noteholders, as applicable, the Indenture Trustee and the Rating Agencies.
The Spread Determination Notice will contain: (i) the determined Spread or fixed
rate of interest, as the case may be, or, if applicable, a statement that the
All Hold Rate or the Failed Remarketing Rate will be in effect for the
immediately following Reset Period, (ii) any applicable currency exchange rate,
(iii) the identity of any selected Swap Counterparty or Counterparties, if
applicable, (iv) if applicable, the floating rate (or rates) of interest to be
due to each selected Swap Counterparty with respect to each Distribution Date
during the immediately following Reset Period and (v) any other information that
the Administrator or the Remarketing Agents deem applicable. Furthermore, for
each class of Reset Rate Notes to be reset in Foreign Exchange Mode, the
currency exchange rate, the Extension Rate due to each related Currency Swap
Counterparty and the Failed Remarketing Rate applicable to such class for the
immediately following Reset Period will be determined pursuant
Appendix A-2-8
to the terms of the related Currency Swap Agreement and contained in the Spread
Determination Notice. In addition, if required for the immediately following
Reset Period, on or before the related Spread Determination Date the
Administrator will arrange for new or additional securities identification codes
to be obtained as required.
Section 10. Swap Agreements:
(a) If a class of Reset Rate Notes is to be reset in Foreign Exchange
Mode, on the related Reset Date, the Administrator will enter into (not in its
individual capacity, but solely as Administrator on behalf of the Trust) or will
instruct the Eligible Lender Trustee to enter into (not in its individual
capacity, but solely as Eligible Lender Trustee) one or more Currency Swap
Agreements for the related Reset Period.
(i) Each Currency Swap Counterparty which is party to a
related Currency Swap Agreement will be entitled to receive: (A) on the
effective date of such Currency Swap Agreement, all secondary market
trade proceeds received from purchasers of the related class of Reset
Rate Notes in the applicable currency, (B) with respect to each
applicable Distribution Date, (x) an interest rate of Three-Month
LIBOR, plus or minus a spread, as determined from the bidding process
described in Section 10(d) below (other than as may be interpolated for
an initial or final calculation period under that Currency Swap
Agreement), multiplied by the U.S. Dollar Equivalent Principal Amount
of the related class of Reset Rate Notes, and multiplied by a fraction
determined by the number of days in the applicable Accrual Period and
the applicable Day Count Basis and (y) all payments of principal in
U.S. Dollars that are allocated to the related class of Reset Rate
Notes; provided that if the -------- related class of Reset Rate Notes
bears a fixed rate of interest and is not structured to receive a
payment of principal until the end of the of the related Reset Period,
all principal payments allocated to the Reset Rate Notes on any
Distribution Date will be deposited into the related Accumulation
Account and paid to the related Swap Counterparties on or about the
next Reset Date as set forth in the related Currency Swap Agreements
(including all sums required to be deposited therein on the Reset
Date), but excluding all Investment Earnings thereon, and (C) on a
Reset Date corresponding to a successful remarketing or an exercise of
the related Call Option, all U.S. Dollar currency equivalent of all
secondary market trade proceeds or proceeds from the exercise of the
related Call Option, as applicable, received from the Remarketing
Agents directly from purchasers of the related class of Reset Rate
Notes (if in U.S. Dollars), from the new Currency Swap Counterparty or
Counterparties, as applicable (if in non-U.S. Dollar currency) or from
the holder of the related Call Option, as applicable. With respect to
the Initial Currency Swap Agreements, the Initial Currency Swap
Counterparty shall be entitled to receive on the Closing Date in lieu
of secondary market proceeds described in clause (A) above, all
applicable non-U.S. Dollar currency proceeds received by the Trust from
purchasers of the related Reset Rate Notes (which shall be net of any
underwriting commission or discount owing to the Initial Purchasers of
such Notes).
(ii) In addition, each related Currency Swap Counterparty will
be obligated to pay to the Trust (for payment to the related Reset Rate
Noteholders, if applicable): (A) on the effective date of such Currency
Swap Agreement, the U.S. Dollar equivalent of all
Appendix A-2-9
secondary market trade proceeds received from purchasers of the related
Reset Rate Notes, (B) with respect to each applicable Distribution
Date, (x) their applicable percentage of the applicable rate of
interest on the related class of Reset Rate Notes multiplied by the
U.S. Dollar Equivalent Principal Amount of the related class of Reset
Rate Notes and multiplied by a fraction determined by the number of
days in the applicable Accrual Period and the applicable Day Count
Basis, and (y) the applicable non-U.S. Dollar currency equivalent of
the U.S. Dollars such Swap Counterparty concurrently receives from the
Trust as a payment of principal allocated to the related class of Reset
Rate Noteholders (including, on the related Maturity Date for such
class of Reset Rate Notes, if a Currency Swap Agreement is then in
effect, the remaining Outstanding Amount of such class of Reset Rate
Notes) but only to the extent that the required U.S. Dollar Equivalent
Principal Amount is received from the Trust on such date, at an
exchange rate to be set on the effective date of and set forth in the
related Currency Swap Agreement, (C) on the second Business Day
following a Distribution Date that is also a Reset Date (other than for
any Reset Period following a Reset Date upon which a Failed Remarketing
has occurred, up to and including the Reset Date resulting in a
successful remarketing or an exercise of the related Call Option) their
applicable percentage of interest at the interest rate from and
including the related Reset Date to, but excluding, the second Business
Day following such Reset Date, and (D) on a related Reset Date
corresponding to a successful remarketing or an exercise of the related
Call Option, the applicable currency equivalent of all U.S. Dollar
secondary market trade proceeds received by the Trust from the
purchasers of the related Reset Rate Notes or proceeds received by the
Trust from the exercise of the related Call Option, as applicable, at
an exchange rate to be set on the effective date of and set forth in
the related Currency Swap Agreement. With respect to the Initial
Currency Swap Agreement, the Initial Currency Swap Counterparty shall
be obligated to pay to the Trust on the Closing Date in lieu of the
payments described in clause (A) above, the U.S. Dollar Equivalent
Principal Amount of the applicable non-U.S. Dollar currency received by
the Trust from the sale of the applicable class of Reset Rate Notes.
For any Reset Period following a Reset Date upon which a Failed
Remarketing has occurred, up to any including the Reset Date resulting
in a successful remarketing or an exercise of the related Call Option
for that class of Reset Rate Notes, payments of interest and principal
to that class of Reset Rate Noteholders will be made on the second
Business Day following the related Reset Date without the payment of
any additional interest.
(b) [Reserved.]
(c) On each Reset Date if a class of Reset Rate Notes is to be reset in
U.S. Dollars, and a Swap Agreement is required pursuant to Sections 2(c) and
9(d) above, then the Administrator will enter into (not in its individual
capacity, but solely as Administrator on behalf of the Trust) or will instruct
the Eligible Lender Trustee to enter into (not in its individual capacity, but
solely as Eligible Lender Trustee), one or more Interest Rate Swap Agreements
for the next Reset Period to facilitate the Trust's ability to pay applicable
interest at the related interest rate.
(i) Each Swap Counterparty which is party to a related
Interest Rate Swap Agreement will be entitled to receive on each
Distribution Date an interest rate of Three-
Appendix A-2-10
Month LIBOR, plus or minus a spread, as determined from the bidding
process described in Section 10(d) below, multiplied by the Outstanding
Amount of the related class of Reset Rate Notes and multiplied by a
fraction determined by the number of days in the applicable Accrual
Period and the applicable Day Count Basis.
(ii) In addition, each related Swap Counterparty which is a
party to a related Interest Rate Swap Agreement will be obligated to
pay to the Trust on each Distribution Date, the applicable rate of
interest on the related class of Reset Rate Notes multiplied by the
Outstanding Amount of the related class of Reset Rate Notes and
multiplied by a fraction determined by the number of days in the
applicable Accrual Period and the applicable Day Count Basis.
(d) Other than with respect to the Initial Currency Swap Agreements,
the Remarketing Agents, in consultation with the Administrator, in determining
the Swap Counterparty to each required Swap Agreement, will solicit bids from at
least three Eligible Swap Counterparties and will select the lowest of these
bids to provide the interest rate swap and/or currency exchange swap(s). If the
lowest bidder specifies a notional amount that is less than the Outstanding
Amount of the related class of Reset Rate Notes, the Remarketing Agents, in
consultation with the Administrator, may select more than one Eligible Swap
Counterparty, but only to the extent that such additional Eligible Swap
Counterparties have provided the next lowest received bid or bids, and enter
into more than one Swap Agreement that result in the Rating Agency Condition
being satisfied.
(e) Other than with respect to the Initial Currency Swap Agreements, it
is a condition precedent to the entering into of any Swap Agreement and the
setting of the amount to be paid to the related Swap Counterparty that the
Rating Agency Condition is satisfied. No Swap Agreement will be entered into or
caused to be entered into by the Trust, the Administrator on its behalf or the
Remarketing Agents, for any Reset Period where either the related Call Option
has been exercised or a Failed Remarketing has been declared.
(f) Each Currency Swap Agreement will terminate at the earliest to
occur of (i) the next succeeding Reset Date for which there is a successful
remarketing, (ii) the Reset Date for which the related Call Option is exercised,
(iii) the Distribution Date on which the Outstanding Amount of the related class
of Reset Rate Notes is reduced to zero (including as the result of the optional
purchase of the remaining Trust Student Loans by the Servicer or an auction of
the Trust Student Loans by the Indenture Trustee) or (iv) the Maturity Date of
the related class of Reset Rate Notes. No Currency Swap Agreement will terminate
solely due to the declaration of a Failed Remarketing. Each Interest Rate Swap
Agreement will terminate on the earliest to occur of the next Reset Date, or the
occurrence of an event specified in clause (iii) or (iv) above.
(g) With respect to each Currency Swap Agreement, and in the event that
a Failed Remarketing is declared, the rate of interest due to each related
Currency Swap Counterparty from the Trust on each Distribution Date will be
increased to the Extension Rate and the rate due to the Trust from each related
Currency Swap Counterparty will change to equal the Failed Remarketing Rate.
Appendix A-2-11
Section 11. Accumulation Accounts; Supplemental Interest Accounts: (a)
If, on any Distribution Date, principal would be payable to a class of Reset
Rate Notes which is then bearing interest at a fixed rate and is not structured
to receive a payment of principal until the end of the related Reset Period,
that principal (subject to sufficient Available Funds therefor) will be
allocated to that class of Reset Rate Notes and deposited into the related
Accumulation Account, where it will remain until the next Reset Date for that
class (except that if a class of Reset Rate Notes is in Foreign Exchange Mode,
principal will be paid according to the provisions of Sections 10(a)(i) and
(a)(ii) above), unless an Event of Default under the Indenture or a sale of the
Trust Estate pursuant to Section 6.1 of the Administration Agreement has
occurred (in which case the Indenture Trustee will distribute all sums on
deposit therein (exclusive of Investment Earnings) to the related Reset Rate
Noteholders in accordance with the provisions of Section 5.4(b) of the Indenture
or Section 6.1 of the Administration Agreement, as applicable).
(b) On each Reset Date, for a class of Reset Rate Notes that bore
interest at a fixed rate during the preceding Reset Period and was not
structured to receive a payment of principal until the end of the related Reset
Period, all sums, if any, then on deposit in the related Accumulation Account,
including any allocation of principal made on the same date, but less any
Investment Earnings, will be distributed by the Indenture Trustee, at the
direction of the Administrator, as set forth in Section 2.8 of the
Administration Agreement, (x) to the holders of that class of Reset Rate Notes,
as of the related Record Date, or (y) if a class of Reset Rate Notes is then in
Foreign Exchange Mode (including during the related initial Reset Period), to
the related Currency Swap Counterparty or Counterparties for the benefit of such
Reset Rate Noteholders as of the Record Date pursuant to the provisions of
Section 10(a)(i) and (a)(ii) above, in reduction of principal of such Reset Rate
Notes; provided that in the event on any Distribution Date the amount on deposit
in the related Accumulation Account (excluding any Investment Earnings) would
equal the Outstanding Amount of that class of Reset Rate Notes, no additional
amounts will be deposited into the related Accumulation Account and all amounts
therein, less any Investment Earnings, will be distributed by the Indenture
Trustee, at the direction of the Administrator, as set forth in Section 2.8 of
the Administration Agreement, on the next related Reset Date to the related
Reset Rate Noteholders or the related Currency Swap Counterparty or
Counterparties (as applicable), and on such Reset Date that class of Reset Rate
Notes will no longer be Outstanding. Amounts on deposit in an Accumulation
Account (exclusive of Investment Earnings) may be used only to pay principal on
the related class of Reset Rate Notes (or to the related Currency Swap
Counterparty or Counterparties) and for no other purpose. On each Distribution
Date, all Investment Earnings on deposit in an Accumulation Account will be
withdrawn by the Indenture Trustee, at the direction of the Administrator and
deposited into the Collection Account.
(c) The Indenture Trustee, subject to sufficient available funds
therefor, at the direction of the Administrator and pursuant to Section
2.10(d)(ii) of the Administration Agreement, will deposit into a Supplemental
Interest Account, the related Supplemental Interest Account Deposit Amount. On
each Distribution Date, all sums (which shall include Investment Earnings) on
deposit in each Supplemental Interest Account will be withdrawn by the Indenture
Trustee, at the direction of the Administrator, as set forth in Section
2.10(d)(iii) of the Administration Agreement, and deposited into the Collection
Account.
Appendix A-2-12
Section 12. Remarketing Agents; Remarketing Fee Account: (a) The
initial Remarketing Agents, appointed pursuant to the terms of the Remarketing
Agreement, are Banc of America Securities LLC, Citigroup Global Markets Inc. and
Credit Suisse First Boston LLC. The terms and conditions of the Remarketing
Agreement will govern the duties and obligations of the Remarketing Agents. The
Administrator, the Trust and the Remarketing Agents will enter into on each (A)
related Remarketing Terms Determination Date and a related Remarketing Agency
Agreement, in form and substance substantially the same as Appendix B to the
Remarketing Agreement, unless (i) a Failed Remarketing is declared, or (ii) the
holder of the related Call Option has delivered the related Call Option Notice
on or prior to such date; and (B) related Spread Determination Date, a
Supplemental Remarketing Agency Agreement, in form and substance substantially
the same as Appendix C to the Remarketing Agreement, unless (i) a Failed
Remarketing is declared, (ii) the holder of the related Call Option has
delivered the related Call Option Notice on or prior to such date, or (iii) if
applicable, 100% of the related Reset Rate Noteholders have timely delivered a
Hold Notice and the All Hold Rate will apply for the next related Reset Period.
(b) [Reserved.]
(c) Excluding all Reset Rate Notes of a class for which a Remarketing
Agent has received a timely delivered Hold Notice, if applicable (or if the
holder of the related Call Option has delivered the related Call Option Notice),
on the Reset Date that commences each Reset Period, each related Reset Rate Note
will be automatically tendered, or deemed tendered, to the relevant Remarketing
Agent for remarketing by such Remarketing Agent on the Reset Date at 100% of its
Outstanding Amount. If the related class of Reset Rate Notes is held in
book-entry form, 100% of the Outstanding Amount of such Reset Rate Notes will be
paid by the Remarketing Agents in accordance with the standard procedures of the
applicable Clearing Agencies.
(d) The Remarketing Agents will attempt, on a reasonable efforts basis
and in accordance with the terms and conditions of the Remarketing Agreement and
the related Remarketing Agency Agreement, to remarket the tendered Reset Rate
Notes of the applicable class at a price equal to 100% of the Outstanding Amount
of the related class of Reset Rate Notes so tendered.
(e) Purchasers of the related class of Reset Rate Notes will be
credited with their positions on the applicable Reset Date with respect to
positions held through DTC or on the next Business Day with respect to positions
held through the European Clearing Systems. No payment delay to existing Reset
Rate Noteholders holding U.S. Dollar-denominated Reset Rate Notes through DTC
will occur on the related Reset Date for any class of Reset Rate Notes
denominated in U.S. Dollars during the immediately following Reset Period.
(f) Each of the Remarketing Agents, in its individual or any other
capacity, may buy, sell, hold and deal in any class of Reset Rate Notes,
including, but not limited to, purchasing any tendered Reset Rate Notes as part
of the remarketing process. Any Remarketing Agent that owns a Reset Rate Note
may exercise any vote or join in any action which any beneficial owner of such
class of Reset Rate Notes may be entitled to exercise or take with like effect
as if it did not act in any capacity under the Remarketing Agreement or
Remarketing Agency Agreement.
Appendix A-2-13
Any Remarketing Agent, in its individual capacity, either as principal or agent,
may also engage in or have an interest in any financial or other transaction
with the Trust, the Depositor, the Servicer, the Indenture Trustee (in its
individual capacity), the Eligible Lender Trustee (in its individual capacity)
or the Administrator as freely as if it did not act in any capacity under the
Remarketing Agreement or any Remarketing Agency Agreement. No Reset Rate
Noteholder or beneficial owner of any Reset Rate Note will have any rights or
claims against any Remarketing Agent as a result of such Remarketing Agent's not
purchasing any tendered Reset Rate Note, which results in the declaration of a
Failed Remarketing.
(g) Each of the Remarketing Agents will be entitled to receive a fee in
connection with their services rendered for each successful remarketing of a
class of Reset Rate Notes in the amount set forth in the Remarketing Agreement
and the related Remarketing Agency Agreement. Subject to the terms and
conditions set forth in the Remarketing Agreement, the Administrator, in its
sole discretion, may change the Remarketing Agents for any class of Reset Rate
Notes for any Reset Period at any time on or before the related Remarketing
Terms Determination Date. In addition, the Administrator will appoint one or
more additional Remarketing Agents, if necessary, for a Reset Date when the
related class of Reset Rate Notes will be remarketed in a non-U.S. Dollar
currency. Furthermore, a Remarketing Agent may resign at any time; provided that
no resignation may become effective on a date that is later than 15 Business
Days prior to a Remarketing Terms Determination Date.
(h) In accordance with Section 2.3(i) of the Administration Agreement,
on the Closing Date, the Trust will establish the Remarketing Fee Account as an
asset of the Trust in the name of the Indenture Trustee, for the benefit of the
Remarketing Agents and the Reset Rate Noteholders. The fees associated with each
successful remarketing will be payable directly to the Remarketing Agents from
amounts on deposit from time to time in the Remarketing Fee Account. On each
applicable Distribution Date, Available Funds will be deposited into the
Remarketing Fee Account, in the priority set forth in Section 2.8(c) of the
Administration Agreement, in an amount up to the Quarterly Funding Amount;
provided that if the amount on deposit in the Remarketing Fee Account, after the
payment of any remarketing fees therefrom, exceeds the sum of the Reset Period
Target Amount for all classes of Reset Rate Notes, such excess will be withdrawn
on the related Distribution Date, deposited into the Collection Account and
included in Available Funds for that Distribution Date. All Investments Earnings
on deposit in the Remarketing Fee Account will be withdrawn on the next
Distribution Date, deposited into the Collection Account and included in
Available Funds for that Distribution Date. In the event that the fees owed to
any Remarketing Agent on a Reset Date exceeds the amount then on deposit in the
Remarketing Fee Account, such shortfall shall be paid from Available Funds on
future Distribution Dates in the priority set forth in Section 2.8(n) of the
Administration Agreement. The Trust shall also be responsible for certain
remarketing costs and expenses to the extent set forth in Section 3 of the
Remarketing Agreement, which shall be paid on each Distribution Date, to the
extent of Available Funds, at the priority set forth in Section 2.8(o) of the
Administration Agreement.
Section 13. Eligible Lender Trustee: The Eligible Lender Trustee is
hereby authorized and directed to execute and deliver, not in its individual
capacity, but solely as Eligible Lender Trustee on behalf of the Trust, the
Remarketing Agreement, any Swap Agreements (including the Initial Currency Swap
Agreements) and any required supplement, amendment or replacement
Appendix A-2-14
thereof, and all Remarketing Agency Agreements and Supplemental Remarketing
Agency Agreements as the Administrator, in writing and from time to time, shall
instruct the Eligible Lender Trustee to execute. The Eligible Lender Trustee
shall not be liable to any party, any third party or any Noteholder for any such
actions taken at the written instruction of the Administrator. Notwithstanding
the foregoing, in the event that the Eligible Lender Trustee declines or fails
to execute or deliver any such document, instrument, certificate or agreement as
instructed by the Administrator, the Administrator is hereby authorized, in its
sole discretion, to execute and deliver, not in its individual capacity but
solely as Administrator on behalf of the Trust, all such required documents,
instruments, certificates and agreements. The foregoing authorization shall
represent a limited power of attorney granted by the Trust to the Administrator
to act on its behalf, and the Administrator shall not be liable to any party,
any third party or any Noteholder for any such actions taken in good faith and
in accordance with these Reset Rate Note Procedures.
Appendix X-0-00
XXXXXXXX X-0
TRANSFER RESTRICTIONS FOR
THE RESET RATE NOTES
1. Except as otherwise specified herein or as the context may otherwise
require, capitalized terms used but not otherwise defined in this Appendix A-3
(this "Appendix") are defined in Xxxxxxxx X-0, which also contains rules as to
usage that shall be applicable herein.
2. The Indenture Trustee, as Note Registrar, shall provide for the
registration of the Reset Rate Notes and of Transfers and exchanges of the Reset
Rate Notes pursuant to Section 2.4 of the Indenture.
3. Each class of Reset Rate Notes initially will be represented by
registered notes of such class in global form and shall be issued in the manner
set forth in Sections 2.1, 2.2 and 2.10 of the Indenture. Global Note
Certificates representing interests in the Reset Rate Notes may be reissued and
represented by Reset Rate Notes of such class in definitive form pursuant to
Section 2.12 of the Indenture.
4. During any Reset Period when the Reset Rate Notes are denominated in a
non-U.S. Dollar currency, any Transfer of Reset Rate Notes made in violation of
Section 2.1 of the Indenture whereby a beneficial interest in either of the
related Non-U.S. Global Note Certificates is Transferred to any related U.S.
Global Note Certificate, or vice versa (other than on a Reset Date where such
class is being reset from being denominated in Foreign Exchange Mode, to U.S.
Dollars), shall be null and void and of no effect.
5. Each purchaser of a class of Reset Rate Notes that represent a
beneficial interest in a Global Note Certificate will be deemed to have
represented and agreed, and each purchaser of a Definitive Note will be required
to certify in writing, that:
(i) (A) the purchaser is a QIB and is acquiring such Reset Rate
Notes for its own account or as a fiduciary or agent for
others (which others also must be QIBs), for investment
purposes and not for distribution in violation of the Act, and
it is able to bear the economic risk of an investment in the
Reset Rate Notes and has such knowledge and experience in
financial and business matters as to be capable of evaluating
the merits and risks of purchasing the Reset Rate Notes or (B)
the purchaser is a non-U.S. Person (as defined in Regulation
S) outside the United States of America, acquiring the Reset
Rate Notes pursuant to an exemption from registration in
accordance with Rule 903 or Rule 904 of Regulation S;
(ii) the purchaser understands that the Reset Rate Notes are being
offered only in a transaction that does not require
registration under the Act and, if such purchaser decides to
resell or otherwise Transfer such Reset Rate Notes, then it
agrees that it will resell or Transfer such Reset Rate Notes
only (A) so long as such Reset Rate Notes are eligible for
resale pursuant to Rule 144A, to a person whom the seller
reasonably believes is a QIB acquiring the Reset Rate Notes
for its own account
Appendix A-3-1
or as a fiduciary or agent for others (which others must also
be QIBs) to whom notice is given that the resale or other
Transfer is being made in reliance on Rule 144A, (B) pursuant
to an effective registration statement under the Act, (C)
pursuant to an exemption from registration available under the
Act other than Rule 144A, or (D) to a purchaser who is a
non-U.S. Person (as defined in Regulation S) outside the
United States of America, acquiring the Reset Rate Notes
pursuant to an exemption from registration under the Act in
accordance with Rule 903 or Rule 904 of Regulation S, in each
case in accordance with any applicable United States state
securities or "blue sky" laws or any securities laws of any
other jurisdiction;
(iii) unless the relevant legend set out below has been removed from
the Reset Rate Notes such purchaser shall notify each
transferee of the Reset Rate Notes that (A) such Reset Rate
Notes have not been registered under the Act, (B) the holder
of such Reset Rate Notes is subject to the restrictions on the
resale or other Transfer thereof described in paragraph (ii)
above, (C) such transferee shall be deemed to have represented
(1) as to its status as a QIB or a purchaser acquiring the
Reset Rate Notes in an offshore transaction pursuant to the
requirements of Regulation S, as the case may be, (2) if such
transferee is a QIB, that such transferee is acquiring the
Reset Rate Notes for its own account or as a fiduciary or
agent for others (which others also must be QIBs) (or that
such transferee is acquiring such Reset Rate Notes in reliance
on an exemption under the Act other than Rule 144A or pursuant
to an effective registration statement under the Act), (3) if
such transferee is a non-U.S. Person (as defined in Regulation
S) outside the United States of America, that such transferee
is acquiring the Reset Rate Notes pursuant to an exemption
from registration under the Act in accordance with the
requirements of Rule 903 or Rule 904 of Regulation S, (4) that
such transferee is not an underwriter within the meaning of
Section 2(11) of the Act, and (5) that such transferee shall
be deemed to have agreed to notify its subsequent transferees
as to the foregoing;
(iv) the acquisition or purchase by an employee benefit plan or
other retirement arrangements ("Plan") of a Reset Rate Note
will not constitute or otherwise result in: (A) in the case of
a Plan subject to Section 406 of Employee Retirement Income
Security Act of 1974, as amended ("ERISA") or Section 4975 of
the Internal Revenue Code of 1986, as amended ("Code"), a
non-exempt prohibited transaction in violation of Section 406
of ERISA or Section 4975 of the Code which is not covered by a
class or other applicable exemption and (B) in the case of a
Plan subject to a substantially similar federal, state, local
or foreign law ("Similar Law"), a non-exempt violation of such
substantially Similar Law.
6. (A) By acceptance of a Reset Rate Note, whether upon original issuance
or subsequent Transfer, each Reset Rate Noteholder or Note Owner, as applicable,
of such Reset Rate Note (or a beneficial interest therein) offered and sold only
to a QIB in reliance on Rule 144A, acknowledges or is deemed to acknowledge, as
the case may be, the restrictions on the Transfer of such Reset Rate Notes and
that the following securities legend (the "Rule 144A Securities
Appendix A-3-2
Legend") shall be affixed to each U.S. Rule 144A Global Note Certificate (as
defined in Section 2.1 of the Indenture), Non-U.S. Rule 144A Global Note
Certificate (as defined in Section 2.1 of the Indenture) and each Definitive
Note representing an interest in either such certificate (collectively, the
"Rule 144A Certificates") unless determined otherwise in accordance with
applicable law:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), ANY
UNITED STATES STATE SECURITIES OR "BLUE SKY" LAWS OR ANY SECURITIES
LAWS OF ANY OTHER JURISDICTION, AND, AS A MATTER OF U.S. LAW, MAY NOT
BE OFFERED OR SOLD IN VIOLATION OF THE SECURITIES ACT OR SUCH OTHER
LAWS. THIS NOTE MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF NOT
LESS THAN $250,000, (pound)100,000, (euro)100,000 OR THE APPLICABLE
CURRENCY EQUIVALENT OF $250,000, DEPENDING ON ITS CURRENCY OF
DENOMINATION. THE HOLDER HEREOF, BY PURCHASING OR ACCEPTING THIS NOTE
IS HEREBY DEEMED TO HAVE AGREED FOR THE BENEFIT OF THE TRUST AND THE
INITIAL PURCHASERS THAT IT WILL RESELL, PLEDGE OR OTHERWISE TRANSFER
THIS NOTE, AS A MATTER OF U.S. LAW, ONLY (A) (1) SO LONG AS THIS NOTE
IS ELIGIBLE FOR RESALE, PURSUANT TO RULE 144A PROMULGATED UNDER THE
SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, AS DEFINED IN RULE 144A (A
"QUALIFIED INSTITUTIONAL BUYER"), THAT IS ACQUIRING THIS NOTE FOR ITS
OWN ACCOUNT OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS MUST
ALSO BE QUALIFIED INSTITUTIONAL BUYERS) TO WHOM NOTICE IS GIVEN THAT
THE RESALE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A,
(2) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT
OTHER THAN RULE 144A, (3) TO A PERSON WHO IS NOT A U.S. PERSON (AS
DEFINED IN REGULATION S PROMULGATED UNDER THE SECURITIES ACT) OUTSIDE
THE UNITED STATES OF AMERICA ACQUIRING THIS NOTE IN ACCORDANCE WITH
RULE 903 OR RULE 904 OF REGULATION S PROMULGATED UNDER THE SECURITIES
ACT OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY UNITED STATES STATE
SECURITIES OR "BLUE SKY" LAWS OR ANY SECURITIES LAWS OF ANY OTHER
JURISDICTION. UPON ACQUISITION OR TRANSFER OF A RESET RATE NOTE OR A
BENEFICIAL INTEREST IN A RESET RATE NOTE, AS THE CASE MAY BE, BY, FOR
OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT
ARRANGEMENT (A "PLAN"), SUCH RESET RATE NOTE OWNER SHALL BE DEEMED TO
HAVE REPRESENTED THAT SUCH ACQUISITION OR PURCHASE WILL NOT CONSTITUTE
OR OTHERWISE RESULT IN: (I) IN THE CASE OF A PLAN SUBJECT TO SECTION
406 OF EMPLOYEE RETIREMENT INCOME
Appendix A-3-3
SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), A NON-EXEMPT
PROHIBITED TRANSACTION IN VIOLATION OF SECTION 406 OF ERISA OR SECTION
4975 OF THE CODE WHICH IS NOT COVERED BY A CLASS OR OTHER APPLICABLE
EXEMPTION AND (II) IN THE CASE OF A PLAN SUBJECT TO A SUBSTANTIALLY
SIMILAR FEDERAL, STATE, LOCAL OR FOREIGN LAW ("SIMILAR LAW"), A
NON-EXEMPT VIOLATION OF SUCH SUBSTANTIALLY SIMILAR LAW. ANY TRANSFER
FOUND TO HAVE BEEN MADE IN VIOLATION OF SUCH DEEMED REPRESENTATION
SHALL BE NULL AND VOID AND OF NO EFFECT.
THIS NOTE AND RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM
TIME TO TIME TO MODIFY THE RESTRICTIONS ON AND PROCEDURES UNDERTAKEN OR
REPRESENTED BY THE HOLDER, FOR RESALES AND OTHER TRANSFERS OF THIS
NOTE, TO REFLECT ANY CHANGE IN APPLICABLE LAWS OR REGULATIONS (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO RESALES OR OTHER
TRANSFERS OF RESTRICTED SECURITIES GENERALLY. THE HOLDER OF THIS NOTE
AND ANY BENEFICIAL OWNER OF ANY INTEREST THEREIN SHALL BE DEEMED, BY
ITS ACCEPTANCE OR PURCHASE HEREOF, TO HAVE AGREED TO ANY SUCH AMENDMENT
OR SUPPLEMENT (EACH OF WHICH SHALL BE CONCLUSIVE AND BINDING ON THE
HOLDER HEREOF AND ALL FUTURE HOLDERS OF THIS NOTE AND ANY RESET RATE
NOTES ISSUED IN EXCHANGE OR SUBSTITUTION HEREFOR, WHETHER OR NOT ANY
NOTATION THEREOF IS MADE HEREON) AND AGREES TO TRANSFER THIS NOTE ONLY
IN ACCORDANCE WITH ANY SUCH AMENDMENT OR SUPPLEMENT IN ACCORDANCE WITH
APPLICABLE LAW IN EFFECT AT THE DATE OF SUCH TRANSFER.
(B) By acceptance of a Reset Rate Note, whether upon original issuance
or subsequent Transfer, each Reset Rate Noteholder or Note Owner, as applicable,
of a class of Reset Rate Notes (or a beneficial interest therein) offered and
sold only to a non-U.S. Person (as defined in Regulation S) outside the United
States of America in reliance on Regulation S acknowledges or is deemed to
acknowledge, as the case may be, the restrictions on the Transfer of such Reset
Rate Notes and that the following securities legend (the "Regulation S
Securities Legend" and with the Rule 144A Securities Legend, the "Securities
Legends" and each a "Securities Legend") shall be affixed to each Regulation S
Global Note Certificate and each Definitive Note representing an interest in
such certificate (collectively, the "Regulation S Certificates") unless
determined otherwise in accordance with applicable law:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"),
ANY UNITED STATES STATE SECURITIES OR "BLUE SKY" LAWS OR ANY SECURITIES
LAWS OF ANY OTHER
Appendix A-3-4
JURISDICTION, AND, AS A MATTER OF U.S. LAW, PRIOR TO THE DATE THAT IS
40 DAYS AFTER THE LATER OF THE COMMENCEMENT OF THE OFFERING OF THE
RESET RATE NOTES AND THE CLOSING OF THE OFFERING OF THE RESET RATE
NOTES MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE
UNITED STATES OF AMERICA OR TO A U.S. PERSON (AS DEFINED IN REGULATION
S PROMULGATED UNDER THE SECURITIES ACT) EXCEPT PURSUANT TO AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR PURSUANT TO
AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN EACH
CASE IN ACCORDANCE WITH ANY UNITED STATES STATE SECURITIES OR "BLUE
SKY" LAWS OR ANY SECURITIES LAWS OF ANY OTHER JURISDICTION. THIS NOTE
MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF NOT LESS THAN
$250,000, (pound)100,000, (euro)100,000 OR THE APPLICABLE CURRENCY
EQUIVALENT OF $250,000, DEPENDING ON ITS CURRENCY OF DENOMINATION.
UPON ACQUISITION OR TRANSFER OF A RESET RATE NOTE OR A BENEFICIAL
INTEREST IN A RESET RATE NOTE, AS THE CASE MAY BE, BY, FOR OR WITH THE
ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT (A
"PLAN"), SUCH RESET RATE NOTE OWNER SHALL BE DEEMED TO HAVE REPRESENTED
THAT SUCH ACQUISITION OR PURCHASE WILL NOT CONSTITUTE OR OTHERWISE
RESULT IN: (I) IN THE CASE OF A PLAN SUBJECT TO SECTION 406 OF EMPLOYEE
RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR SECTION
4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), A
NON-EXEMPT PROHIBITED TRANSACTION IN VIOLATION OF SECTION 406 OF ERISA
OR SECTION 4975 OF THE CODE WHICH IS NOT COVERED BY A CLASS OR OTHER
APPLICABLE EXEMPTION AND (II) IN THE CASE OF A PLAN SUBJECT TO A
SUBSTANTIALLY SIMILAR FEDERAL, STATE, LOCAL OR FOREIGN LAW ("SIMILAR
LAW"), A NON-EXEMPT VIOLATION OF SUCH SUBSTANTIALLY SIMILAR LAW. ANY
TRANSFER FOUND TO HAVE BEEN MADE IN VIOLATION OF SUCH DEEMED
REPRESENTATION SHALL BE NULL AND VOID AND OF NO EFFECT.
Upon the Transfer, exchange or replacement of a Rule 144A Certificate
or a Regulation S Certificate bearing the applicable legends set forth above, or
upon specific request for removal of the legends, the Trust or the Registrar
will deliver only replacement Rule 144A Certificates or Regulation S
Certificates, as the case may be, that bear such applicable legends, or will
refuse to remove such applicable legends, unless there is delivered to the Trust
and the Registrar such satisfactory evidence (which may include a legal opinion)
as may reasonably be required by the Trust and the Indenture Trustee that
neither the applicable legends nor the restrictions on Transfer set forth
therein are required to ensure compliance with the provisions of the Act.
Appendix A-3-5
Whenever a Global Note Certificate is to be exchanged for Definitive
Notes, such Definitive Notes will be issued within five business days of
delivery to the Registrar of the information and any required certification
described in the preceding paragraph against the surrender of the relevant
Global Note Certificate at the specified office of the Registrar. Such exchange
shall be effected in accordance with the regulations concerning the Transfer and
registration from time to time relating to the Reset Rate Notes and shall be
effected without charge, but against such indemnity as the Registrar may require
in respect of any tax or other duty of whatsoever nature which may be levied or
imposed in connection with such exchange.
Each Reset Rate Noteholder or Note Owner, as applicable, of such Reset
Rate Note, by its acceptance of a Reset Rate Note or a beneficial interest
therein, respectively, also agrees that it will Transfer such Reset Rate Note or
beneficial interest therein, as the case may be, only as provided herein and in
accordance with the Indenture. In addition, by acceptance of any Reset Rate Note
or beneficial interest therein, as applicable, each proposed transferee thereof
is hereby deemed to have agreed with the conditions set forth in the applicable
Securities Legend and agreed, by virtue of its acceptance of such Reset Rate
Note or beneficial interest therein, as the case may be, to indemnify the
Administrator, the Depositor, the Servicer, the Indenture Trustee the Eligible
Lender Trustee, the Remarketing Agents (in the event such Transfer is made
pursuant to a successful remarketing on a Reset Date) and the Issuer against any
and all liability that may result if such Transfer is not made in a manner
consistent with the restrictions set forth in the Securities Legend. In addition
to any applicable restrictions in the Indenture, with respect to the Transfer
and registration of Transfer of any Reset Rate Note registered in the name of a
Reset Rate Noteholder other than DTC or its nominee, or Euroclear or
Clearstream, Luxembourg or their joint nominee, as the case may be, to a
transferee that takes delivery in the form of a Definitive Note, in a
transaction other than pursuant to an effective registration statement under the
Act, the Indenture Trustee shall register the Transfer of such Definitive Note
if (i) (A) the requested Transfer is being made to a transferee who has provided
the Indenture Trustee and the Administrator with a Rule 144A and Related Matters
Certificate, substantially in the form attached as Annex 1 hereto, (B) such
transferee has provided comparable evidence as to its QIB status, (C) such
Transfer is being made in compliance with Regulation S and such transferee has
provided the Indenture Trustee and the Administrator with a Regulation S and
Related Matters Certificate, substantially in the form attached as Annex 1
hereto, or (D) such Transfer is being made in reliance on an exemption from
registration under the Act other than Rule 144A or Regulation S and that such
transferor has provided the Indenture Trustee and the Administrator with
reasonably acceptable evidence thereof, and (ii) the applicable transferor has
provided the Indenture Trustee and the Administrator with a Transferor Letter,
substantially in the form of Annex 2 hereto.
6. Each class of Reset Rate Notes will be issued only in minimum
denominations of $250,000, or the applicable currency equivalent of $250,000,
(euro)100,000, (pound)100,000 or the applicable currency equivalent of $250,000,
depending on its currency of denomination, and integral xxxxxxxxx xx x0,
(xxxx)0, (xxxxx)0 or the applicable currency equivalent of $1, depending on its
currency of denomination, in excess thereof. The Reset Rate Notes are
exchangeable at any time into an equal aggregate principal amount of Reset Rate
Notes of the same class of different authorized denominations pursuant to
Section 2.4 of the Indenture.
Appendix A-3-6
7. Reset Rate Notes may be presented or surrendered pursuant to Section
2.4 of the Indenture.
8. No service charge shall be made to a Noteholder for any registration of
Transfer or exchange of Reset Rate Notes, but the Indenture Trustee may require
payment of a sum sufficient to cover any tax or other governmental charge
pursuant to Section 2.4 of the Indenture.
9. The Indenture Trustee shall cancel all Reset Rate Notes surrendered for
Transfer or exchange pursuant to Section 2.8 of the Indenture.
10. For so long as any class of Reset Rate Notes are "restricted
securities" within the meaning of Rule 144(a)(3) of the Act, (1) the
Administrator will provide or cause to be provided to any holder of such Reset
Rate Notes and any prospective purchaser thereof designated by such a holder,
upon the request of such holder or prospective purchaser, the information
required to be provided to such holder or prospective purchaser by Rule
144A(d)(4) under the Act; and (2) the Administrator shall update such
information from time to time in order to prevent such information from becoming
false and misleading and will take such other actions as are necessary to ensure
that the safe harbor exemption from the registration requirements of the Act
under Rule 144A is and will be available for resales of such Reset Rate Notes
conducted in accordance with Rule 144A.
Appendix X-0-0
XXXXX 0 XX
XXXXXXXX X-0
FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE
[Date]
[SELLER]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Xxxxxx Xxx, Inc., as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2004-3, Student Loan-Backed, Class A-6A
and Class A-6B Reset Rate Notes (the "Reset Rate Notes")
Dear Sirs:
In connection with our purchase of the Class [A-6A] [A-6B]
Reset Rate Notes of the above-referenced series, the undersigned certifies to
each of the parties to whom this letter is addressed that it is a qualified
institutional buyer (as defined in Rule 144A under the Securities Act of 1933,
as amended (the "Act")) as follows:
(A) It owned and/or invested on a discretionary basis eligible
securities (excluding affiliate's securities, bank deposit notes and CD's, loan
participations, repurchase agreements, securities owned but subject to a
repurchase agreement and swaps), as described below:
Date: __, 20__ (must be on or after the close of its most
recent fiscal year)
Amount: $_____; and
(B) The dollar amount set forth above is:
1. greater than $100 million and the undersigned is one
of the following entities:
an insurance company as defined in Section
2(13) of the Act; or
an investment company registered under the
Investment Company Act or any business
development company as defined in Section
2(a)(48) of the Investment Company Act
Appendix A-3-8
of 1940; or
a Small Business Investment Company licensed
by the U.S. Small Business Administration
under Section 301 (c) or (d) of the Small
Business Investment Act of 1958; or
a plan (i) established and maintained by a
state, its political subdivisions, or any
agency or instrumentality of a state or its
political subdivisions, the laws of which
permit the purchase of securities of this
type, for the benefit of its employees and
(ii) the governing investment guidelines of
which permit the purchase of securities of
this type; or
a business development company as defined in
Section 202(a)(22) of the Investment
Advisers Act of 1940; or
a corporation (other than a U.S. bank,
savings and loan association or equivalent
foreign institution), partnership,
Massachusetts or similar business trust, or
an organization described in Section
501(c)(3) of the Internal Revenue Code; or
a U.S. bank, savings and loan association or
equivalent foreign institution, which has an
audited net worth of at least $25 million as
demonstrated in its latest annual financial
statements; or
an investment adviser registered under the
Investment Advisers Act; or 2.
2. greater than $10 million, and the undersigned is a
broker-dealer registered with the SEC; or
3. less than $10 million, and the undersigned is a
broker-dealer registered with the SEC and will only
purchase Rule 144A securities in transactions in
which it acts as a riskless principal (as defined in
Rule 144A); or
4. less than $100 million, and the undersigned is an
investment company registered under the Investment
Company Act of 1940, which, together with one or more
registered investment companies having the same or an
affiliated investment adviser, owns at least $100
million of eligible securities; or
5. less than $100 million, and the undersigned is an
entity, all the equity owners of which are qualified
institutional buyers.
Appendix A-3-9
The undersigned further certifies that it is purchasing the
Reset Rate Notes for its own account or for the account of others that
independently qualify as "Qualified Institutional Buyers" as defined in Rule
144A (a "QIB"). It is aware that the sale of the Reset Rate Notes is being made
in reliance on its continued compliance with Rule 144A. It is aware that the
transferor may rely on the exemption from the provisions of Section 5 of the Act
provided by Rule 144A. The undersigned understands that the Reset Rate Notes may
be Transferred only (A) so long as such Reset Rate Notes are eligible for resale
pursuant to Rule 144A, to a person whom the seller reasonably believes is a QIB
acquiring the Reset Rate Notes for its own account or as a fiduciary or agent
for others (which others must also be QIBs) to whom notice is given that the
Transfer is being made in reliance on Rule 144A, (B) pursuant to an effective
registration statement under the Act, (C) pursuant to an exemption from
registration available under the Act other than Rule 144A, or (D) to a purchaser
who is a non-U.S. Person (as defined in Regulation S) outside the United States
of America, acquiring the Reset Rate Notes pursuant to an exemption from
registration under the Act in accordance with Rule 903 or Rule 904 of Regulation
S, in each case in accordance with any applicable United States state securities
or "blue sky" laws or any securities laws of any other jurisdiction.
The undersigned agrees that if at some future time it wishes
to dispose of or exchange any of the Reset Rate Notes, it will not Transfer or
exchange any of the Reset Rate Notes unless: (1) the sale is to an Eligible
Purchaser (as defined below), (2) all offers or solicitations in connection with
the sale, whether directly or through any agent acting on our behalf, are
limited only to Eligible Purchasers and are not made by means of any form of
general solicitation or general advertising whatsoever, and (3) such transferee
shall deliver a Rule 144A and Related Matters Certificate to substantially the
same effect as this letter to the addressees hereof or a Regulation S and
Related Matters Certificate substantially in the same form as set forth in Annex
1 to Appendix 3 to the Indenture, or such other evidence as may be reasonably
acceptable to the Administrator.
The undersigned hereby represents and warrants that the
undersigned is accepting ownership of the Reset Rate Notes in compliance with
the restrictions set forth in Section 5 of Appendix A-3 to the Indenture, dated
as of March 1, 2004 (the "Indenture"), among the Trust, Chase Manhattan Bank
USA, National Association, as eligible lender trustee, and The Bank of New York,
as indenture trustee, and acknowledges that the Reset Rate Notes will be issued
with the legends set forth in Section 6 of Appendix A-3 to the Indenture.
"Eligible Purchaser" means a corporation, partnership or other
entity which we have reasonable grounds to believe and do believe (A) (i) can
make representations with respect to itself to substantially the same effect as
the representations set forth herein, and (ii) is a QIB as defined under Rule
144A of the Act or any entity in which all of the equity owners come within such
paragraphs, (B) can make representations with respect to itself to substantially
the same effect as the representations set forth in the Regulation S and Related
Matters Certificate in the same form as Annex 1 to Appendix 3 to the Indenture,
or (C) (i) can make representations with respect to itself substantially to the
same effect as the representations set forth herein (other than to its status as
a QIB), and (ii) is acquiring such Reset Rate Notes in reliance on an exemption
to the Act other than Rule 144A in accordance with any applicable United States
state securities or "Blue Sky" laws.
Appendix A-3-10
If the Purchaser proposes that its Reset Rate Notes be
registered in the name of a nominee on its behalf, the Purchaser has identified
such nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any): ______________________________
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
Qualified Institutional Buyer on the ____ day of _____, 20__.
Name of Institution
________________________________________
Signature
________________________________________
Name
________________________________________
Title
NOMINEE ACKNOWLEDGMENT
The undersigned hereby acknowledges and agrees that as to the
Reset Rate Notes being registered in its name, the sole beneficial owner thereof
is and shall be the Purchaser identified above, for whom the undersigned is
acting as nominee.
By:
________________________________________
Duly Authorized
Appendix A-3-11
FORM OF REGULATION S AND RELATED MATTERS CERTIFICATE
[Date]
[SELLER]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Xxxxxx Xxx, Inc., as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2004-3, Student Loan-Backed, Class A-6A
and Class A-6B Reset Rate Notes (the "Reset Rate Notes")
Dear Sirs:
In connection with our purchase of the Class [A-6A] [A-6B]
Reset Rate Notes of the above-referenced series, the undersigned certifies to
each of the parties to whom this letter is addressed that it is a non-U.S.
person (as defined in Regulation S) outside the United States of America,
acquiring the Reset Rate Notes pursuant to an exemption from registration in
accordance with Rule 903 or Rule 904 of Regulation S.
The undersigned further certifies that it is purchasing the
Reset Rate Notes for its own account or for the account of others that
independently qualify as non-U.S. persons (as defined in Regulation S) outside
the United States of America. It is aware that the sale of the Reset Rate Notes
is being made in reliance on its continued compliance with Rule 903 or Rule 904
of Regulation S. The undersigned understands that the Reset Rate Notes may
resold or Transferred only (A) so long as such Reset Rate Notes are eligible for
resale pursuant to Rule 144A, to a person whom the seller reasonably believes is
a QIB acquiring the Reset Rate Notes for its own account or as a fiduciary or
agent for others (which others must also be QIBs) to whom notice is given that
the resale or other Transfer is being made in reliance on Rule 144A, (B)
pursuant to an effective registration statement under the Act, (C) pursuant to
another exemption from registration available under the Act other than Rule
144A, or (D) to a purchaser who is a non-U.S. Person (as defined in Regulation
S) outside the United States of America, acquiring the Reset Rate Notes pursuant
to an exemption from registration under the Act in accordance with Rule 903 or
Rule 904 of Regulation S, in each case in accordance with any applicable United
States state securities or "blue sky" laws or any securities laws of any other
jurisdiction.
The undersigned agrees that if at some future time it wishes
to dispose of or exchange any of the Reset Rate Notes, it will not Transfer or
exchange any of the Reset Rate Notes unless: (1) the sale is to an Eligible
Purchaser (as defined below), (2) all offers or
Appendix A-3-12
solicitations in connection with the sale, whether directly or through any agent
acting on our behalf, are limited only to Eligible Purchasers and are not made
by means of any form of general solicitation or general advertising whatsoever,
and (3) such transferee shall deliver a Rule 144A Certificate substantially in
the same form as Annex 1 to Appendix 3 to the Indenture, or a Regulation S
Certificate to substantially the same effect as this letter to the addressees
hereof or such other evidence as may be reasonably acceptable to the
Administrator and the Indenture Trustee.
The undersigned hereby represents and warrants that the
undersigned is accepting ownership of the Reset Rate Notes in compliance with
the restrictions set forth in Section 5 of Appendix A-3 to the Indenture, dated
as of March 1, 2004 (the "Indenture"), among the Trust, Chase Manhattan Bank
USA, National Association, as eligible lender trustee, and The Bank of New York,
as indenture trustee, and acknowledges that the Reset Rate Notes will be issued
with the legends set forth in Section 5 to Appendix A-3 to the Indenture.
"Eligible Purchaser" means a corporation, partnership or other
entity which we have reasonable grounds to believe and do believe (A) (i) can
make representations with respect to itself to substantially the same effect as
the representations set forth herein, and (ii) is a QIB as defined under Rule
144A of the Act or any entity in which all of the equity owners come within such
paragraphs, (B) (i) can make representations with respect to itself to
substantially the same effect as the representations set forth in the Regulation
S Certificate in the same form as Annex 1 to Appendix 3 to the Indenture, and
(ii) is acquiring such Reset Rate Notes pursuant to an exemption from
registration in accordance with Rule 903 or Rule 904 of Regulation S, or (C) (i)
can make representations with respect to itself substantially to the same effect
as the representations set forth herein (other than to its status as a QIB), and
(ii) is acquiring such Reset Rate Notes in reliance on an exemption to the Act
other than Rule 144A in accordance with any applicable United States state
securities or "Blue Sky" laws.
If the Purchaser proposes that its Reset Rate Notes be
registered in the name of a nominee on its behalf, the Purchaser has identified
such nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any): ___
Appendix A-3-13
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
non-U.S. person on the ____ day of _____, 20__.
Name of Institution
________________________________________
Signature
________________________________________
Name
________________________________________
Title
NOMINEE ACKNOWLEDGMENT
The undersigned hereby acknowledges and agrees that as to the
Reset Rate Notes being registered in its name, the sole beneficial owner thereof
is and shall be the Purchaser identified above, for whom the undersigned is
acting as nominee.
By:
________________________________________
Duly Authorized
Appendix X-0-00
XXXXX 0 XX
XXXXXXXX X-0
FORM OF TRANSFEROR LETTER
[Date]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
Xxxxxx Xxx, Inc., as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2004-3, Student Loan-Backed, Class A-6A
and Class A-6B Reset Rate Notes (the "Reset Rate Notes")
Ladies and Gentlemen:
In connection with our disposition of the Class [A-6A] [A-6B] Reset Rate Notes
of the above-referenced series owned by us, we certify that (a) we understand
that the Reset Rate Notes have not been registered under the Securities Act of
1933, as amended (the "Act"), and are being disposed by us in a transaction that
is exempt from the registration requirements of the Act, and (b) we have not
offered or sold any Reset Rate Notes to, or solicited offers to buy any Reset
Rate Notes from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action would result in, a violation of Section 5 of the Act.
Very truly yours,
________________________________________
Print Name of Transferor
By:_____________________________________
Authorized Officer
Appendix A-3-15
SCHEDULE A
Schedule of Trust Student Loans
[See Schedule A to the Xxxx of Sale
(Attachment B to the Sale Agreement)]
Schedule A-1
SCHEDULE B
Location of Trust Student Loan Files
[See Attachment B to the Servicing Agreement]
Schedule B-1
EXHIBIT A
[FORM OF NOTES]
(SEE TABS 15.1 THROUGH 16.1)
Exhibit A-1
EXHIBIT B
[Form of Note Depository Agreement
for U.S. Dollar Denominated Notes]
Exhibit B-1
EXHIBIT C
[Form of Note Depository Agreement for
Notes Denominated in a Currency Other than U.S. Dollars]
Exhibit C-1
