WFG 8/3/98
[FORM OF]
ADMINISTRATION AGREEMENT dated as of [______ __, 1999], among
EFG STUDENT LOAN TRUST 1999-[ ], a Delaware trust (the "Issuer"), EDUCATIONAL
FINANCE GROUP, Inc., a Delaware corporation, as administrator (the
"Administrator"), and [INDENTURE TRUSTEE], a [ ] banking corporation, not
in its individual capacity but solely as Indenture Trustee (the "Indenture
Trustee").
W I T N E S S E T H
WHEREAS the Issuer was formed pursuant to the Trust Agreement
dated as of [______ __, 1998] (the "Trust Agreement") among, EFG Funding
Corporation (the "EFG Funding" or the "Depositor"), a Delaware corporation, and
[TRUSTEE], as Trustee (the "Trustee") and is issuing the Floating Rate Asset
Backed Senior Notes (the "Senior Notes") and the Floating Rate Asset Backed
Subordinate Notes (the "Subordinate Notes," and together with the Senior Notes,
the "Notes") pursuant to the Indenture dated as of [______ __, 1999] (the
"Indenture"), between the Issuer and the Indenture Trustee, (capitalized terms
used herein and not defined herein shall have the meanings assigned to such
terms in Appendix A hereto, which also contains rules of usage and construction
that shall be applicable herein);
WHEREAS the Issuer has entered into certain agreements in
connection with the issuance of the Notes, including the Transfer Agreement, the
Servicing Agreement, [the Senior Note Depository Agreement (the "Depository
Agreement")], the Guarantee Agreements, the Trust Agreement and the Indenture
(all such agreements being collectively referred to herein as the "Related
Agreements");
WHEREAS, pursuant to the Related Agreements, the Issuer and
the Trustee are required to perform certain duties in connection with the Notes
and the Collateral therefor pledged pursuant to the Indenture;
WHEREAS the Issuer and the Trustee desire to have the
Administrator perform certain of the duties of the Issuer and the Trustee
referred to in the preceding clause, and to provide such additional services
consistent with the terms of this Agreement and the Related Agreements as the
Issuer and the Trustee may from time to time request;
WHEREAS the Administrator has the capacity to provide the
services required hereby and is willing to perform such services for the Issuer
and the Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties agree as follows:
1. Representations of the Administrator. The Administrator
makes the following representations on which the Issuer and the Trustee are
deemed to have relied. The
representations speak as of the execution and delivery of this Agreement and as
of the Closing Date, in the case of the Initial Student Loans, {as of the
applicable Transfer Date, in the case of the Serial Loans and New Loans,} as of
the relevant date of assignment, in the case of any Qualified Substitute Student
Loan, {as of the date of origination, in the case of any Consolidation Loan
originated by the Trust during the Revolving Period, and as of the applicable
Add-on Consolidation Loan Funding Date, in the case of any Consolidation Loan
the principal balance of which is increased by the principal balance of any
related Add-on Consolidation Loan,} but shall survive the sale of the Student
Loans to the Trustee on behalf of the Issuer (and legal title to the FFELP
Student Loans to the Eligible Lender Trustee) and the pledge thereof to the
Indenture Trustee pursuant to the Indenture.
(a) Organization and Good Standing. The Administrator is duly
organized and validly existing as a corporation in good standing under
the laws of the State of Delaware, with the power and authority to own
its properties and to conduct its business as such properties are
currently owned and such business is presently conducted.
(b) Power and Authority of the Administrator. The
Administrator has the organizational power and authority to execute and
deliver this Agreement and to carry out its terms, and the execution,
delivery and performance of this Agreement has been duly authorized by
the Administrator by all necessary corporate action.
(c) Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Administrator, enforceable in
accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization and similar laws relating to creditors'
rights generally and subject to general principles of equity.
(d) No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof
or thereof do not conflict with, result in any breach of any of the
terms and provisions of, nor constitute (with or without notice or
lapse of time or both) a default under, the certificate of
incorporation of the Administrator, or any indenture, agreement or
other instrument to which the Administrator is a party or by which it
shall be bound; nor result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument; nor violate any law or, to the knowledge
of the Administrator, any order, rule or regulation applicable to the
Administrator of any court or of any Federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Administrator or its properties. The consummation
by the Administrator of the transactions contemplated by this Agreement
will not result in the loss of any Guarantee Payments by the Trust or
any reinsurance payments with respect to any Student Loan.
(e) No Proceedings. There are no proceedings or investigations
pending against the Administrator or, to its best knowledge, threatened
against the Administrator, before any court, regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Administrator or its properties: (i) asserting
the invalidity of this Agreement, the Indenture or any of the other
Related Agreements or
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the Notes, (ii) seeking to prevent the issuance of the Notes or the
consummation of any of the transactions contemplated by this Agreement,
the Indenture or any of the other Related Agreements, (iii) seeking any
determination or ruling that could reasonably be expected to have a
material and adverse effect on the performance by the Administrator of
its obligations under, or the validity or enforceability of, this
Agreement, the Indenture, any of the other Related Agreements or the
Notes or (iv) seeking to affect adversely the Federal or state income
tax attributes of the Issuer or the Notes.
(f) All Consents. All authorizations, consents, orders or
approvals of or registrations or declarations with any court,
regulatory body, administrative agency or other government
instrumentality required to be obtained, effected or given by the
Administrator in connection with the execution and delivery by the
Administrator of this Agreement and the performance by the
Administrator of the transactions contemplated by this Agreement have
in each case been duly obtained, effected or given and are in full
force and effect.
2. Duties of the Administrator.
(a) Duties with Respect to the Indenture and Depository
Agreement. The Administrator shall perform all its duties as
Administrator and the duties of the Issuer under the Depository
Agreement. In addition, the Administrator shall consult with the
Trustee as the Administrator deems appropriate regarding the duties of
the Issuer under the Indenture and the Depository Agreement. The
Administrator shall monitor the performance of the Issuer and shall
advise the Trustee when action is necessary to comply with the Issuer's
duties under the Indenture and the Depository Agreement. The
Administrator shall prepare for execution by the Issuer or shall cause
the preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be
the duty of the Issuer to prepare, file or deliver pursuant to the
Indenture and the Depository Agreement. In furtherance of the
foregoing, the Administrator shall take all appropriate action that is
the duty of the Issuer to take pursuant to the Indenture, including
such of the foregoing as are required with respect to the following
matters (references are to sections of the Indenture):
(i) the duty to cause the Note Registrar to keep the
Note Register and to give the Indenture Trustee prompt notice
of any appointment of a new Note Registrar and the location,
or change in location, of the Note Register (Section 2.04);
(ii) the fixing or causing to be fixed of any
specified record date and the timely notification of the
Indenture Trustee and Noteholders with respect to special
payment dates, if any (Section 2.07(c));
(iii) the preparation of or obtaining of the
documents and instruments required for authentication of the
Notes and delivery of the same to the Indenture Trustee
(Section 2.02);
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(iv) the preparation, obtaining or filing of the
instruments, opinions and certificates and other documents
required for the release of collateral (Section 2.09);
(v) the preparation, obtaining or filing of the
instruments, opinions and certificates and other documents
required for a transfer of Subordinate Notes (Section 2.04);
(vi) [the duty to cause the Note Registrar to
maintain on behalf of the Issuer an office in [ ], for
registration of transfer or exchange of Notes (Section 3.02);]
(vii) the duty to cause newly appointed Paying
Agents, if any, to deliver to the Indenture Trustee the
instrument specified in the Indenture regarding funds held in
trust (Section 3.03);
(viii) the direction to the Paying Agents to deposit
moneys with the Indenture Trustee (Section 3.03);
(ix) the obtaining and preservation of the Issuer's
qualification to do business in each jurisdiction in which
such qualification is or shall be necessary to protect the
validity and enforceability of the Indenture, the Notes, the
Collateral and each other instrument and agreement included in
the Indenture Trust Estate (Section 3.04);
(x) the preparation of all supplements, amendments,
financing statements, continuation statements, instruments of
further assurance and other instruments, in accordance with
Section 3.05 of the Indenture, necessary to protect the
Indenture Trust Estate (Section 3.05);
(xi) the delivery by the Issuer of the Opinion of
Counsel on the Closing Date and the annual delivery of
Opinions of Counsel, in accordance with Section 3.06 of the
Indenture, as to the Indenture Trust Estate, and the annual
delivery of the Officers' Certificate of the Issuer and
certain other statements, in accordance with Section 3.09 of
the Indenture, as to compliance with the Indenture (Sections
3.06 and 3.09);
(xii) the identification to the Indenture Trustee in
an Officers' Certificate of the Issuer of a Person with whom
the Issuer has contracted to perform its duties under the
Indenture (Section 3.07(b));
(xiii) the notification of the Indenture Trustee and
the Rating Agencies of a Servicer Default pursuant to the
Servicing Agreement and, if such Servicer Default arises from
the failure of the Servicer to perform any of its duties under
the Servicing Agreement, the taking of all reasonable steps
available to remedy such failure (Section 3.07(d));
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(xiv) the preparation and obtaining of documents and
instruments required for the release of the Issuer from its
obligations under the Indenture (Section 3.10);
(xv) the prompt delivery of notice to the Indenture
Trustee and the Rating Agencies of each Event of Default, any
Default under Section 5.01(iii) of the Indenture and each
default by the Servicer under the Servicing Agreement or by
the Seller under the Loan Sale Agreement (Section 3.18);
(xvi) the monitoring of the Issuer's obligations as
to the satisfaction and discharge of the Indenture and the
preparation of an Officers' Certificate of the Issuer and the
obtaining of the Opinion of Counsel and the Independent
Certificate relating thereto (Section 4.01);
(xvii) the compliance with any written directive of
the Indenture Trustee with respect to the sale of the
Indenture Trust Estate in a commercially reasonable manner if
an Event of Default shall have occurred and be continuing
(Section 5.04);
(xviii) the preparation of any written instruments
required to confirm more fully the authority of any co-trustee
or separate trustee and any written instruments necessary in
connection with the resignation or removal of any co-trustee
or separate trustee (Sections 6.08 and 6.10);
(xix) the furnishing of the Indenture Trustee with
the names and addresses of Noteholders during any period when
the Indenture Trustee is not the Note Registrar (Section
7.01);
(xx) the preparation and, after execution by the
Issuer, the filing with the Commission, any applicable State
agencies and the Indenture Trustee of documents required to be
filed on a periodic basis with, and summaries thereof as may
be required by rules and regulations prescribed by, the
Commission and any applicable State agencies and the
transmission of such summaries, as necessary, to the
Noteholders (Section 7.03);
(xxi) the opening of one or more accounts in the
Issuer's name, the preparation of Issuer Orders, Officers'
Certificates of the Issuer and Opinions of Counsel and all
other actions necessary with respect to investment and
reinvestment of funds in the Trust Accounts (Sections 8.02 and
8.03);
(xxii) the preparation of an Issuer Request and
Officers' Certificate of the Issuer and the obtaining of an
Opinion of Counsel and Independent Certificates, if necessary,
for the release of the Indenture Trust Estate (Sections 8.04
and 8.05);
(xxiii) the preparation of Issuer Orders and the
obtaining of Opinions of Counsel with respect to the execution
of supplemental indentures and the mailing
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to the Noteholders of notices with respect to such
supplemental indentures (Sections 9.01, 9.02 and 9.03);
(xxiv) the preparation of or obtaining of the
documents and instruments required for the execution and
authentication of new Notes conforming to any supplemental
indenture and the delivery of the same to the Eligible Lender
Trustee and the Indenture Trustee, respectively (Section
9.06);
(xxv) the notification of Noteholders of redemption
of the Notes or the duty to cause the Indenture Trustee to
provide such notification (Section 10.02);
(xxvi) the preparation of all Officers' Certificates
of the Issuer, Opinions of Counsel and Independent
Certificates with respect to any requests by the Issuer to the
Indenture Trustee to take any action under the Indenture
(Section 11.01(a));
(xxvii) the preparation and delivery of Officers'
Certificates of the Issuer and the obtaining of Independent
Certificates, if necessary, for the release of property from
the lien of the Indenture (Section 11.01(b));
(xxviii) the preparation and timely delivery to
Noteholders and the Indenture Trustee of any agreements with
respect to alternate payment and notice provisions (Section
11.06); and
(xxix) the recording of the Indenture, if applicable
(Section 11.15).
(b) Duties with Respect to the Issuer. In addition to the
duties of the Administrator set forth above and in the other Related
Agreements, the Administrator shall perform such calculations and shall
prepare for execution by the Issuer or the Trustee or shall cause the
preparation by other appropriate Persons of all such documents,
reports, filings, instruments, certificates and opinions as it shall be
the duty of the Issuer or the Trustee to prepare, file or deliver
pursuant to the Related Agreements, and at the request of the Trustee
shall take all appropriate action that it is the duty of the Issuer to
take pursuant to the Related Agreements. In furtherance thereof, the
Trustee shall, on behalf of itself and of the Issuer, execute and
deliver to the Administrator and to each successor Administrator
appointed pursuant to the terms hereof, one or more powers of attorney
substantially in the form of Exhibit A hereto, appointing the
Administrator the attorney-in-fact of the Trustee and the Issuer for
the purpose of executing on behalf of the Trustee and the Issuer all
such documents, reports, filings, instruments, certificates and
opinions. Subject to Section 9 of this Agreement, and in accordance
with the directions of the Trustee, the Administrator shall administer,
perform or supervise the performance of such other activities in
connection with the Collateral (including the Related Agreements) as
are not covered by any of the foregoing provisions and as are expressly
requested by the Trustee and are reasonably within the capability of
the Administrator.
(i) Notwithstanding anything in this Agreement or the
Related Agreements to the contrary, the Administrator shall
deliver to the Trustee, the
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Indenture Trustee, the Rating Agencies and (if the Seller
is not the Administrator) the Seller, an Officers' Certificate
of the Administrator containing all the information necessary:
{(A) to pay the Department any Consolidation
Fees due and payable to the Department, to the extent
such Consolidation Fees are not being deducted by the
Department out of Special Allowance Payments or
Interest Subsidy Payments, which Officers'
Certificate shall be delivered on the date that is
three Business Days prior to the date such fees are
to be remitted to the Department;
(B) during the Revolving Period to pay the
Depositor, for payment to the Seller pursuant to
Section 2.02 of the Loan Sale Agreement, on each
Transfer Date, the Loan Purchase Amount (or if the
Parity Date has occurred the Purchase Collateral
Balance) for New Loans or Serial Loans purchased by
the Issuer on such date and on each Transfer Date
after the end of the Revolving Period, the Purchase
Collateral Balance for Serial Loans so purchased on
such date (but, only to the extent the Purchase
Collateral Balance has not been satisfied by the
exchange of Serial Loans for Exchanged Student
Loans), which Officers' Certificate, in each case,
shall be delivered on the Business Day preceding such
Transfer Date;}
(C) to pay the Servicer the Servicing Fee
due on each Monthly Payment Date pursuant to Section
2(d)(iv)(A), 2(d)(v)(A) and 2(e)(iv)(A) and any
Servicing Fee Shortfall due on each Quarterly Payment
Date pursuant to Section 2(e)(ii)(b)(iv), which
Officers' Certificate shall be delivered on each
Determination Date;
(D) to make all the distributions required
by Sections 2(d), 2(e) and 2(f), for the Monthly
Collection Period or Collection Period, as the case
may be, preceding the date of such Officers'
Certificate, which Officers' Certificate shall be
delivered on each Determination Date.
(ii) In addition, prior to each Determination Date
immediately preceding a Quarterly Payment Date, the
Administrator shall determine, in compliance with its
obligation to prepare an Officers' Certificate on such
Determination Date pursuant to this Section, the Senior Note
Rate and the Subordinate Note Rate that will be applicable to
the Quarterly Payment Date following such Determination Date.
In connection therewith, the Administrator shall calculate the
T-Xxxx Rate and the Student Loan Rate in accordance with the
respective definitions thereof for the related Quarterly
Interest Period.
(iii) [Reserved.]
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(iv) Notwithstanding anything in this Agreement or
the Related Agreements to the contrary, the Administrator
shall be responsible for performance of the duties of the
Trustee set forth in Section 5.02 of the Trust Agreement with
respect to, among other things, any tax information or
accounting report required to be distributed to Note Owners.
(v) [Reserved.]
(vi) The Administrator shall perform the duties of
the Administrator specified in Sections 10.02 and 10.03 of the
Trust Agreement required to be performed in connection with
the resignation or removal of the Trustee and the appointment
of a successor Trustee, and any other duties expressly
required to be performed by the Administrator under the Trust
Agreement and the other Related Agreements, including those
under Sections 6.07 and 6.08 of the Indenture and those under
Section 6.07 of the Trust Agreement.
(vii) As described in Article IX of the Trust
Agreement, notice of any termination of the Trust shall be
given by the Administrator to the Trustee and the Indenture
Trustee as soon as practicable after the Administrator has
received notice thereof.
(viii) In carrying out the foregoing duties or any of
its other obligations under this Agreement, the Administrator
may enter into transactions with or otherwise deal with any of
its Affiliates; provided, however, that the terms of any such
transactions or dealings shall be in accordance with any
directions received from the Issuer and shall be, in the
Administrators opinion, no less favorable to the Issuer than
would be available from unaffiliated parties.
(c) Establishment and Maintenance of Trust Accounts.
(i) The Administrator, for the benefit of the Issuer,
shall establish and maintain in the name of the Indenture
Trustee an Eligible Deposit Account (the "Collection
Account"), bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the
Issuer. The Collection Account will initially be established
as a segregated trust account in the name of the Indenture
Trustee with the corporate trust department of [ ].
(ii) The Administrator, for the benefit of the
Issuer, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Reserve
Account"), bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the
Issuer. The Reserve Account will initially be established as a
segregated trust account in the name of the Indenture Trustee
with the corporate trust department of [ ].
(iii) The Administrator, for the benefit of the
Issuer, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the
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"Collateral Reinvestment Account"), bearing a designation
clearly indicating that the funds deposited therein are held
for the benefit of the Issuer. The Collateral Reinvestment
Account will initially be established as a segregated trust
account in the name of the Indenture Trustee with the
corporate trust department of [ ].
(iv) [Reserved.]
(v) Funds on deposit in the Collection Account, the
Reserve Account and the Collateral Reinvestment Account
(collectively, the "Trust Accounts") shall be invested by the
Indenture Trustee (or any custodian or designated agent with
respect to any amounts on deposit in such accounts) in
Eligible Investments pursuant to written instructions by the
Administrator; provided, however, it is understood and agreed
that the Indenture Trustee shall not be liable for any loss
arising from such investment in Eligible Investments. All such
Eligible Investments shall be held by (or by any custodian on
behalf of) the Indenture Trustee for the benefit of the
Issuer; provided that on the Business Day preceding each
Monthly Payment Date all interest and other investment income
(net of losses and investment expenses) on funds on deposit
therein shall be deposited into the Collection Account and
shall be deemed to constitute a portion of the Monthly
Available Funds for each Monthly Payment Date that is not a
Quarterly Payment Date, and a portion of the Available Funds
for each Quarterly Payment Date. Other than as permitted by
the Rating Agencies, funds on deposit in the Trust Accounts
shall be invested in Eligible Investments that will mature so
that funds sufficient to pay the Servicing Fee and the
Administration Fee will be available in the Collection Account
on the Business Day preceding each Monthly Payment Date that
is not a Quarterly Payment Date, so that funds on deposit in
the Collateral Reinvestment Account that are required, in the
judgment and at the discretion of the Administrator, to make
Additional Fundings during the Revolving Period will be
available for such purpose and so that the remaining such
funds will be available at the close of business on the
Business Day preceding each Quarterly Payment Date.
(vi) The Indenture Trustee shall possess all right,
title and interest in all funds on deposit from time to time
in the Trust Accounts and in all proceeds thereof (including
all income thereon) and all such funds, investments, proceeds
and income shall be part of the Trust Estate. The Trust
Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Issuer. If, at any
time, any of the Trust Accounts ceases to be an Eligible
Deposit Account, the Indenture Trustee (or the Administrator
on its behalf) agrees, by its acceptance hereto, that it shall
within 10 Business Days (or such longer period, not to exceed
30 calendar days, as to which each Rating Agency may consent)
establish a new Trust Account as an Eligible Deposit Account
and shall transfer any cash and/or any investments to such new
Trust Account. In connection with the foregoing, the
Administrator agrees that, in the event that any of the Trust
Accounts are not accounts with the Indenture Trustee, the
Administrator shall
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notify the Indenture Trustee in writing promptly upon any of
such Trust Accounts ceasing to be an Eligible Deposit Account.
(vii) With respect to the Trust Account Property, the
Indenture Trustee agrees, by its acceptance hereof, that:
(1) any Trust Account Property that is held
in deposit accounts shall be held solely in Eligible
Deposit Accounts, subject to the last sentence of
clause (vi) above; and each such Eligible Deposit
Account shall be subject to the exclusive custody and
control of the Indenture Trustee, and the Indenture
Trustee shall have sole signature authority with
respect thereto;
(2) any Trust Account Property that
constitutes Physical Property shall be Delivered to
the Indenture Trustee in accordance with paragraph
(a) of the definition of "Delivery" and shall be
held, pending maturity or disposition, solely by the
Indenture Trustee or a financial intermediary (as
such term is defined in Section 8-313(4) of the UCC)
acting solely for the Indenture Trustee;
(3) any Trust Account Property that is a
book-entry security held through the Federal Reserve
System pursuant to Federal book-entry regulations
shall be Delivered in accordance with paragraph (b)
of the definition of "Delivery" and shall be
maintained by the Indenture Trustee, pending maturity
or disposition, through continued book-entry
registration of such Trust Account Property as
described in such paragraph; and
(4) any Trust Account Property that is an
"uncertificated security" under Article VIII of the
UCC and that is not governed by clause (3) above
shall be Delivered to the Indenture Trustee in
accordance with paragraph (c) of the definition of
"Delivery" and shall be maintained by the Indenture
Trustee, pending maturity or disposition, through
continued registration of the Indenture Trustee's (or
its nominees) ownership of such security.
(viii) The Administrator shall have the power,
revocable for cause or upon the occurrence and during the
continuance of an Administrator Default by the Indenture
Trustee or by the Trustee with the consent of the Indenture
Trustee, to instruct the Indenture Trustee to make withdrawals
and payments from the Trust Accounts for the purpose of
permitting the Servicer or the Trustee to carry out its
respective duties under the Servicing Agreement or the Trust
Agreement or permitting the Indenture Trustee to carry out its
duties under the Indenture.
(ix) On each Determination Date, the Administrator
shall calculate all amounts required to determine the amounts
to be deposited in the Collection Account and the other Trust
Accounts and the amounts to be distributed therefrom
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on the related Monthly Payment Date, Quarterly Payment Date or
other dates from which amounts therein are to be distributed.
(d) Withdrawals from the Collection Account. The Administrator
shall instruct the Indenture Trustee (based, in the case of clauses
(iv) and (v) below, on the information contained in the servicer's
report delivered with respect to the applicable Determination Date
pursuant to Section 3.07 of the Servicing Agreement) to make
withdrawals from amounts deposited in the Collection Account at the
following times and for the following purposes, and the Indenture
Trustee shall comply with such instructions:
{(i) from time to time during the Revolving Period,
in so far as the Administrator may so instruct on any Business
Day therein, to deposit all collections in respect of
principal on the Student Loans into the Collateral
Reinvestment Account;
(ii) from time to time during each Collection Period
to pay the Department any Consolidation Fees due and payable
to the Department, to the extent such Consolidation Fees are
not being deducted by the Department out of Special Allowance
Payments or Interest Subsidy Payments;
(A) on each Add-on Consolidation Loan
Funding Date after the Revolving Period, to prepay in
full any Add-on Consolidation Loan not held by the
Issuer pursuant to Section 6.07 of the Trust
Agreement; provided that the amount paid to prepay
any Add-on Consolidation Loan not held by the Issuer
on any date since the preceding Quarterly Payment
Date shall not exceed the Net Principal Cash Flow
Amount for such date minus the aggregate Purchase
Collateral Balance remitted for the purchase of
Serial Loans on each Transfer Date since the
preceding Quarterly Payment Date after the Revolving
Period pursuant to Section 2(d)(iii)(B); and
(B) on each Transfer Date after the
Revolving Period to pay to the Seller, pursuant to
Section 2.02 of the Loan Sale Agreement, the
aggregate Purchase Collateral Balance for Serial
Loans purchased by the Eligible Lender Trustee on
behalf of the Issuer on such date (but only to the
extent such aggregate Purchase Collateral Balance has
not been satisfied by the exchange of Serial Loans
for Exchanged Student Loans); provided that the
amount paid to the Seller for the purchase of Serial
Loans on such Transfer Date plus the amount of funds
remitted for the purchase of Serial Loans on each
Transfer Date since the preceding Quarterly Payment
Date on any Transfer Date after the Revolving Period
shall not exceed the Net Principal Cash Flow Amount
for such Transfer Date minus the sum of (i) all
amounts paid since the last Quarterly Payment Date
pursuant to Section 2(d)(iii)(A) to prepay any Add-on
Consolidation Loan not held by the Issuer and (ii)
all amounts which the Administrator reasonably
estimates will be required to prepay Add-on
Consolidation
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Loans pursuant to Section 2(d)(iii)(A) during the
remainder of the Collection Period; provided,
further, that, any Purchase Premium Amounts for
Serial Loans purchased (including pursuant to the
exchange thereof) after the Revolving Period shall
be paid only out of Reserve Account Excess as set
forth in Section 2(e)(ii).}
(iii) on each Monthly Payment Date that is not a
Quarterly Payment Date, to make the following deposits and
distributions to the Persons specified below by 11:00 a.m.
(New York Time), to the extent of Monthly Available Funds for
such Monthly Payment Date in the Collection Account, in the
following order of priority:
(A) to the Servicer, the Servicing Fee with
respect to the preceding calendar month and all
unpaid Servicing Fees from prior months; and
(B) to the Administrator, from the amount of
Monthly Available Funds remaining after the
application of clause (A), the Administration Fee
with respect to the preceding calendar month and all
unpaid Administration Fees from prior months.
(iv) on each Quarterly Payment Date, to make the
following deposits and distributions to the Persons or the
account specified below by 11:00 a.m. (New York Time), to the
extent of Available Funds for such Quarterly Payment Date in
the Collection Account, in the following order of priority:
(v) to the Servicer, the Servicing Fee with respect
to the preceding calendar month and all unpaid Servicing Fees
from prior months;
(vi) to the Administrator, from the amount of
Available Funds remaining after the application of clause (A),
the Administration Fee with respect to the preceding calendar
month and all unpaid Administration Fees from prior months;
(vii) to the Indenture Trustee for distribution to
the Noteholders pursuant to Section 8.02(c) of the Indenture,
from the amount of Available Funds remaining after the
application of clauses (A) and (B), the Noteholders'
Distribution Amount with respect to such Quarterly Payment
Date; and
(viii) to the Reserve Account, the amount of
Available Funds remaining after the application of clauses (A)
through (C).
Except in the case of amounts deposited pursuant to clause
(viii) into the Reserve Account, amounts properly withdrawn from the Collection
Account and distributed pursuant to this Section 2(d) shall be deemed released
from the Trust Estate and the security interest therein granted to the Indenture
Trustee, and the Persons to whom such amounts are distributed shall in no event
be required to refund any such distributed amounts.
- 12 -
(e) Reserve Account. The Seller shall deposit the Reserve
Account Initial Deposit into the Reserve Account as required by Section
2.01(b) of the Loan Sale Agreement.
(i) With respect to any amount in the Reserve Account
on any Quarterly Payment Date (after giving effect to all
deposits thereto on such Quarterly Payment Date and to all
withdrawals therefrom necessary to make the distributions
required to be made from Available Funds on such Quarterly
Payment Date) in excess of the Specified Reserve Account
Balance for such Quarterly Payment Date (the "Reserve Account
Excess"), the Administrator shall instruct the Indenture
Trustee to pay such Reserve Account Excess (a) during the
Revolving Period, for deposit to the Collateral Reinvestment
Account; provided, however, if such date is on or after the
Parity Date, to the extent that such funds represent payments
of interest with respect to the Student Loans, such funds
shall be applied in the amounts and the order of priority set
forth in clauses (b)(iii) through (vi) below, and (b) at and
after the termination of the Revolving Period, to the
following (in the priority indicated): (i) to pay to the
Depositor for payment to the Seller any unpaid Purchase
Premium Amounts for any Serial Loans purchased by the Issuer
after the end of the Revolving Period but prior to the end of
the related Collection Period; (ii) if such Quarterly Payment
Date is on or prior to the Parity Date, to pay to the
Indenture Trustee for distribution to Noteholders pursuant to
Section 8.02(d) of the Indenture an amount equal to the lesser
of (x) the remaining amount of such excess and (y) the amount
by which the aggregate principal balance of the Notes, after
giving effect to all other distributions in respect of
principal on the Notes on such Quarterly Payment Date, exceeds
the Pool Balance as of the close of business on the last day
of the related Collection Period; (iii) to pay to the
Indenture Trustee for distribution to Noteholders pursuant to
Section 8.02(d) of the Indenture, out of the remaining amount
of such excess, an amount equal to the aggregate unpaid
Noteholders' Interest T-Xxxx Carryover; (iv) to pay to the
Servicer, out of the remaining amount of such excess, the
Servicing Fee Shortfall and all prior unpaid Servicing Fee
Shortfalls, if any; (v) to pay to the Depositor for payment to
the Seller, out of the remaining amount of such excess, any
unpaid Purchase Premium Amounts for any Serial Loans or New
Loans purchased during the Revolving Period but after the
Parity Date (or at any time during the Collection Period
during which the Parity Date occurs) and prior to the end of
the related Collection Period; and (vi) any remaining amount
of such excess, after application of clauses (i) through (v)
above, will be released to the Depositor; provided, however,
that if and to the extent that (A) the amount of the
Servicer's unpaid repurchase obligation pursuant to Section
3.05 of the Servicing Agreement exceeds $[500,000] as of the
last day of the preceding Collection Period (and such Servicer
has not been replaced by a Successor Servicer), or (B) the
Department fails by the last day of such preceding Collection
Period to satisfy its obligations to reimburse or replace a
Federal Guarantor pursuant to the Higher Education Act, then
any Reserve Fund Excess remaining on such Quarterly Payment
Date for distribution to the Depositor pursuant to the clause
(vi) above shall not be so
- 13 -
distributed and shall be retained in the Reserve Account for
application in accordance with this Agreement. Amounts
properly distributed pursuant to this Section 2(e)(i) shall be
deemed released from the Trust Estate and the security
interest therein granted to the Indenture Trustee, and the
Depositor shall in no event thereafter be required to refund
any such distributed amounts.
(ii) Following the payment in full of the aggregate
outstanding principal balance of the Notes and of all other
amounts owing or to be distributed hereunder or under the
Indenture to Noteholders, the Depositor, the Servicer or the
Administrator and the termination of the Trust (including any
Noteholders' Interest T-Xxxx Carryover, any Servicing Fee
Shortfall and any unpaid Servicing Fee Shortfalls and unpaid
Purchase Premium Amounts), any amount remaining on deposit in
the Reserve Account shall be distributed to the Depositor. The
Depositor shall in no event be required to refund any amounts
properly distributed pursuant to this Section 2(e)(ii).
(iii) In the event that the Servicing Fee for any
Monthly Payment Date exceeds the amount distributed to the
Servicer pursuant to Sections 2(d)(iii)(A) or 2(d)(v) on such
Monthly Payment Date, the Administrator shall instruct the
Indenture Trustee to withdraw from the Reserve Account on each
Monthly Payment Date an amount equal to such excess and to
distribute such amount to the Servicer.
(iv) In the event that the Administration Fee for any
Monthly Payment Date exceeds the amount distributed to the
Administrator pursuant to Sections 2(d)(iii)(B) or 2(d)(vi) on
such Monthly Payment Date, the Administrator shall instruct
the Indenture Trustee to withdraw from the Reserve Account on
such Monthly Payment Date an amount equal to such excess, to
the extent of funds available therein after giving effect to
paragraph (iv)(A) above, and to distribute such amount to the
Administrator.
(v) For any Quarterly Payment Date, in the event that
the Noteholders' Distribution Amount for such Quarterly
Payment Date exceeds the sum of the amount distributed to the
Indenture Trustee for distribution to the Noteholders pursuant
to Section 2(d)(vii) on such Quarterly Payment Date, the
Administrator shall instruct the Indenture Trustee to withdraw
from the Reserve Account on such Quarterly Payment Date an
amount equal to such excess, to the extent of funds available
therein after giving effect to paragraphs (iii) and (iv)
above, and to distribute such amount as required by Section
2(d)(viii) on such Quarterly Payment Date.
{(f) Collateral Reinvestment Account. During the Revolving
Period, the Administrator shall instruct the Indenture Trustee in
writing to withdraw from the Collateral Reinvestment Account, in each
case to the extent of the funds on deposit therein (A) on each Transfer
Date, an amount equal to the Loan Purchase Amount for the Serial Loans
and New Loans transferred to the Eligible Lender Trustee on behalf of
the
- 14 -
Issuer on such Transfer Date and to distribute such amount to or upon
the order of the Seller upon satisfaction of the conditions set forth
in Section 2.02 of the Loan Sale Agreement with respect to such
transfer, (B) when and as requested by the Eligible Lender Trustee, in
order to facilitate its origination of Consolidation Loans, to transfer
to the order of the Eligible Lender Trustee an amount sufficient to
prepay in full any Student Loan (including any and all Financed Student
Loans) that is to be consolidated through such origination with one or
more Financed Student Loans, (C) when and as requested by the Eligible
Lender Trustee, in order to facilitate its funding of the addition of
the principal balance of any Add-on Consolidation Loan to the principal
balance of a Consolidation Loan an amount sufficient to prepay in full
such Add-on Consolidation Loan, (D) on each Determination Date, to
deposit into the Collection Account an amount equal to the Capitalized
Interest Amount for the Student Loan Rate Accrual Period with respect
to the related Monthly Payment Date and (E) on any Determination Date
and in such amounts as the Administrator may direct, for deposit to the
Collection Account for the purposes of increasing Monthly Available
Funds or Available Funds, as the case may be.
(i) On the Quarterly Payment Date on or next
occurring after the termination of the Revolving Period, the
Administrator shall instruct the Indenture Trustee to withdraw
from the Collateral Reinvestment Account on such Quarterly
Payment Date an amount equal to the entire remaining amount on
deposit in such account and to distribute such amount to
Noteholders pursuant to Section 8.02(e) of the Indenture.}
(g) Statements to Noteholders. On each Determination Date
preceding a Quarterly Payment Date, the Administrator shall provide to
the Indenture Trustee (with a copy to the Rating Agencies) for the
Indenture Trustee to forward on such succeeding Quarterly Payment Date
to each Noteholder of record a statement substantially in the form of
Exhibit B setting forth at least the following information as to the
Notes:
(i) the amount of such distribution allocable to
principal of the Notes, the amount thereof distributable as
principal of the Senior Notes and the Subordinate Notes, the
amount thereof attributable to the Principal Distribution
Amount and the amount thereof attributable to Reserve Account
Excess;
(ii) the amount of the distribution allocable on such
Quarterly Payment Date to interest on the Senior Notes;
(iii) the amount of the distribution allocable on
such Quarterly Payment Date to interest on the Subordinate
Notes;
(iv) the amount, if any, of such distribution
allocable to any Senior Noteholders' Interest T-Xxxx Carryover
and any Subordinate Noteholders' Interest T-Xxxx Carryover,
together with any remaining outstanding amount of each
thereof;
- 15 -
(v) the Pool Balance as of the close of business on
the last day of the preceding Collection Period, after giving
effect to payments allocated to principal reported under
clause (A) above;
(vi) the aggregate outstanding principal balance of
the Senior Notes and the Subordinate Notes, the Senior Note
Pool Factor and the Subordinate Note Pool Factor as of such
Quarterly Payment Date, after giving effect to payments
allocated to principal reported under clause (A) above;
{(vii) the Note Rate applicable with respect to each
distribution referred to in clauses (B) and (C) above,
indicating whether such interest rate was calculated based on
the Student Loan Rate or based on the T-Xxxx Rate, and
specifying what each such Note Rate would have been using the
alternate basis for such calculation;
(viii) the amount of the Servicing Fee paid to the
Servicer on such Quarterly Payment Date and on each Monthly
Payment Date following the immediately preceding Quarterly
Payment Date including a breakdown of the components of the
Servicing Fee attributable to each of the items specified in
clauses II(i) through (ix) of Section 3.06 of the Servicing
Agreement and the amount of any Servicing Fee Shortfall for
such Quarterly Payment Date and for each Monthly Payment Date
following the immediately preceding Quarterly Payment Date;
(ix) the amount of the Administration Fee paid to the
Administrator on such Quarterly Payment Date and on each
Monthly Payment Date following the immediately preceding
Quarterly Payment Date;
(x) the amount of the aggregate Realized Losses, if
any, for such Collection Period and the balance of Financed
Student Loans that are delinquent in each delinquency period
as of the end of such Collection Period;
(xi) the balance of the Reserve Account on such
Quarterly Payment Date, after giving effect to changes therein
on such Quarterly Payment Date and indicating whether on such
Quarterly Payment Date or any Monthly Payment Date since the
preceding Quarterly Payment Date any withdrawal was made
therefrom pursuant to Section 2(e)(iv), the amount of each
such withdrawal and the purpose(s) pursuant to Section
2(e)(iv) for each such withdrawal;
(xii) for Quarterly Payment Dates during the
Revolving Period, the amount deposited into the Collateral
Reinvestment Account during the related Collection Period and
on the immediately preceding Quarterly Payment Date, and the
amount on deposit therein after giving effect to changes
therein on such Quarterly Payment Date;
- 16 -
(xiii) for the Quarterly Payment Date on or
immediately following the end of the Revolving Period, the
amount remaining on deposit in the Collateral Reinvestment
Account that has not been used to make Additional Fundings;
(xiv) the principal balance and number of
Consolidation Loans originated on behalf of the Issuer during
the related Collection Period, (ii) the principal balance and
number of Add-on Consolidation Loans the principal balances of
which have been added to the Trust during the related
Collection Period and (iii) the amount withdrawn from the
Collateral Reinvestment Account to prepay Student Loans not
held by the Issuer that were consolidated through such
origination (or addition, in the case of Add-on Consolidation
Loans) with one or more Financed Student Loans during such
Collection Period;
(xv) the principal balance and number of Serial Loans
conveyed to the Issuer during the related Collection Period,
the aggregate Loan Purchase Amount thereof and the portion
thereof attributable to Purchase Premium Amounts;
(xvi) for Quarterly Payment Dates during the
Revolving Period, the principal balance and number of New
Loans conveyed to the Issuer during the related Collection
Period, the aggregate Loan Purchase Amount thereof and the
portion thereof attributable to Purchase Premium Amounts;} and
(xvii) the number and principal balance of Financed
Student Loans as of the end of the related Collection Period,
that are In-School, Grace, Repayment, Deferral, Forbearance or
Consolidation Loans as of the of the related Collection
Period, and a breakdown by number and principal balance of
Financed Student Loans, by school type, interest rate and loan
program.
Each amount set forth pursuant to clauses (A), (B), (C) and
(D) above shall be expressed as a dollar amount per $1,000 of original principal
balance of a Note. A copy of the statements referred to above may be obtained by
any Note Owner by a written request to the Indenture Trustee addressed to the
Corporate Trust Office.
(h) Non-Ministerial Matters. With respect to matters that in
the reasonable judgment of the Administrator are non-ministerial, the
Administrator shall not take any action unless within a reasonable time
before the taking of such action, the Administrator shall have notified
the Trustee of the proposed action and the Trustee shall have consented
to it. For the purpose of the preceding sentence, "non-ministerial
matters" shall include:
(i) the amendment of or any supplement to the
Indenture;
(ii) the initiation of any claim or lawsuit by the
Issuer and the compromise of any action, claim or lawsuit
brought by or against the Issuer (other than in connection
with the collection of the Student Loans, including any
allegation of forgery by a putative borrower under a Student
Loan);
(iii) the amendment, change or modification of the
Related Agreements;
- 17 -
(iv) the appointment of successor Note Registrars,
successor Paying Agents and successor Indenture Trustees
pursuant to the Indenture or the appointment of successor
Administrators or Successor Servicers, or the consent to the
assignment by the Note Registrar, Paying Agent or Indenture
Trustee of its obligations under the Indenture; and
(v) the removal of the Indenture Trustee.
[(i) Incentive Loans and Incentive Interest Deposits. The
Administrator may terminate or change the terms of any Incentive
Program with respect to a Student Loan in accordance with the terms of
such program, provided such termination or change is not prohibited by
the Higher Education Act, upon notice to the Trustee and the Indenture
Trustee. Until the effective date of any termination, the Administrator
shall be required to deposit into the Collection Account the Incentive
Interest Deposit with respect to such Incentive Student Loan as
provided below. In the event that the Administrator fails to make such
deposit, the terms of such Incentive Program shall be such that the
Borrower shall be obligated to make such payment and such Incentive
Program shall terminate as to the related loan.]
The Administrator shall deposit or cause to be deposited into
the Collection Account no later than the Determination Date succeeding each
Monthly Collection Period the aggregate Incentive Interest Deposits with respect
to Incentive Student Loans in the Trust as of the last day of such Monthly
Collection Period. Such deposits shall be considered deposits in respect of
interest on such Incentive Student Loans for all purposes of the Basic Documents
and shall be deemed to have been deposited into the Collection Account for all
such purposes as of such last date of such Monthly Collection Period.
3. Annual Statement as to Compliance. (a) The Administrator
shall deliver to the Depositor, the Eligible Lender Trustee and the Indenture
Trustee, on or before ___________ __ of each year beginning __________ __, 1999,
an Officers' Certificate of the Administrator dated as of __________ __ of such
year, stating that (i) a review of the activities of the Administrator during
the preceding 12-month period (or, in the case of the first such certificate,
during the period from the Closing Date to _______ __, 1999) and of its
performance under this Agreement has been made under such officers' supervision
and (ii) to the best of such officers' knowledge, based on such review, the
Administrator has fulfilled all its obligations under this Agreement throughout
such year or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to such officers and the nature
and status thereof. The Indenture Trustee shall send a copy of each such
Officer's Certificate and each report referred to in Section 4 to the Rating
Agencies. A copy of such Officers' Certificate and each report referred to in
Section 4 may be obtained by any Noteholder or Note Owner by a request in
writing to the Indenture Trustee addressed to its Corporate Trust Office,
together with evidence satisfactory to the Indenture Trustee that such Person is
one of the foregoing parties.
(b) The Administrator shall deliver to the Depositor, the
Trustee, the Indenture Trustee, the Servicer, and the Rating Agencies,
promptly after having obtained knowledge thereof, but in no event later
than two Business Days thereafter, written notice in an
- 18 -
Officers' Certificate of the Administrator of any event which with the
giving of notice or lapse of time, or both, would become an
Administrator Default under Section 12.
4. Annual Independent Certified Public Accountants' Report.
The Administrator shall cause a firm of independent certified public
accountants, which may also render other services to the Administrator, to
deliver to the Depositor, the Trustee and the Indenture Trustee on or before
________ __ of each year beginning __________ __, 1999, a report addressed to
the Administrator and to the Depositor, the Trustee and the Indenture Trustee
(which report may be combined with other reports required to be delivered by
such accountants to the Administrator, the Trustee and the Indenture Trustee
under the Related Agreements), to the effect that such firm has examined certain
documents and records relating to the administration of the Student Loans and of
the Trust during the preceding fiscal year ended _________ __ (or, in the case
of the first such report, during the period from the Closing Date to __________
__, 1999) and that, on the basis of the accounting and auditing procedures
considered appropriate under the circumstances, such firm is of the opinion that
the administration of the Trust was conducted in compliance with the terms of
this Agreement, except for (i) such exceptions as such firm shall believe to be
immaterial and (ii) such other exceptions as shall be set forth in such report.
The Indenture Trustee shall send a copy of each such report to the Rating
Agencies.
Such report will also indicate that the firm is independent of
the Administrator within the meaning of the Code of Professional Ethics of the
American Institute of Certified Public Accountants.
5. Administrator Expenses. The Administrator shall be required
to pay all expenses incurred by it in connection with its activities hereunder,
including fees and disbursements of independent accountants, taxes imposed on
the Administrator and expenses incurred in connection with distributions and
reports to the Noteholders.
6. Records. The Administrator shall maintain appropriate books
of account and records relating to services performed hereunder, which books of
account and records shall be accessible for inspection by the Issuer at any time
during normal business hours.
7. Compensation. As compensation for the performance of the
Administrator's obligations under this Agreement and as reimbursement for its
expenses related thereto, the Administrator shall be entitled to the
Administration Fee payable monthly in arrears on each Monthly Payment Date which
shall be solely an obligation of the Issuer and payable solely as provided
herein.
8. Additional Information To Be Furnished to the Issuer. The
Administrator shall furnish to the Issuer from time to time such additional
information regarding the Collateral as the Issuer shall reasonably request.
9. Independence of the Administrator. For all purposes of this
Agreement, the Administrator shall be an independent contractor and shall not be
subject to the supervision of the Issuer, the Trustee or the Eligible Lender
Trustee with respect to the manner in which it
- 19 -
accomplishes the performance of its obligations hereunder. Unless expressly
authorized by the Issuer, the Administrator shall have no authority to act for
or represent the Issuer, the Trustee or the Eligible Lender Trustee in any way
and shall not otherwise be deemed an agent of the Issuer, the Trustee or the
Eligible Lender Trustee.
10. No Joint Venture. Nothing contained in this Agreement (i)
shall constitute the Administrator and any of the Issuer, the Trustee or the
Eligible Lender Trustee as members of any partnership, joint venture,
association, syndicate, unincorporated business or other separate entity, (ii)
shall be construed to impose any liability as such on any of them or (iii) shall
be deemed to confer on any of them any express, implied or apparent authority to
incur any obligation or liability on behalf of the others.
11. Other Activities of Administrator. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Trustee,
the Eligible Lender Trustee or the Indenture Trustee.
12. Administrator Default. If any one of the following events
(an "Administrator Default") shall occur and be continuing:
(a) any failure by the Administrator to direct the Indenture
Trustee to make any required distributions from any of the Trust
Accounts, which failure continues unremedied for three Business Days
after written notice of such failure is received by the Administrator
from the Indenture Trustee or the Trustee or after discovery of such
failure by an officer of the Administrator; or
(b) any failure by the Administrator duly to observe or to
perform in any material respect any other covenants or agreements of
the Administrator set forth in this Agreement or any Related
Agreements, which failure shall (i) materially and adversely affect the
rights of Noteholders and (ii) continues unremedied for a period of 30
days after the date on which written notice of such failure, requiring
the same to be remedied, shall have been given (A) to the Administrator
by the Indenture Trustee or the Trustee or (B) to the Administrator and
to the Indenture Trustee and the Trustee by the Noteholders,
representing not less than ___% of the Outstanding Amount of the Notes;
or
(c) an Insolvency Event occurs with respect to the
Administrator;
(d) then, and in each and every case, so long as the
Administrator Default shall not have been remedied, either the
Indenture Trustee, or the Noteholders evidencing not less than __% of
the Outstanding Amount of the Notes, by notice then given in writing to
the Administrator (and to the Indenture Trustee and the Trustee if
given by the Noteholders) may terminate all the rights and obligations
(other than the obligations set forth in Section 24 hereof) of the
Administrator under this Agreement. On or after the receipt by the
Administrator of such written notice, all authority and power of the
Administrator under this Agreement, whether with respect to the Notes
or the Financed
- 20 -
Student Loans or otherwise, shall, without further action, pass to and
be vested in the Indenture Trustee or such successor Administrator as
may be appointed under Section 13; and, without limitation, the
Indenture Trustee and the Trustee are hereby authorized and empowered
to execute and deliver, for the benefit of the predecessor
Administrator, as attorney-in-fact or otherwise, any and all documents
and other instruments, and to do or accomplish all other acts or things
necessary or appropriate to effect the purposes of such notice of
termination. The predecessor Administrator shall cooperate with the
successor Administrator, the Indenture Trustee and the Trustee in
effecting the termination of the responsibilities and rights of the
predecessor Administrator under this Agreement. All reasonable costs
and expenses (including attorneys' fees and expenses) incurred in
connection with amending this Agreement to reflect such succession as
Administrator pursuant to this Section shall be paid by the predecessor
Administrator upon presentation of reasonable documentation of such
costs and expenses. Upon receipt of notice of the occurrence of an
Administrator Default, the Trustee shall give notice thereof to the
Rating Agencies.
13. Appointment of Successor. Upon receipt by the
Administrator of notice of termination pursuant to Section 12, or the
resignation by the Administrator in accordance with the terms of this Agreement,
the predecessor Administrator shall continue to perform its functions as
Administrator, in the case of termination, only until the date specified in such
termination notice or, if no such date is specified in a notice of termination,
until receipt of such notice and, in the case of resignation, until the later of
(x) the date 120 days from the delivery to the Trustee and the Indenture Trustee
of written notice of such resignation (or written confirmation of such notice)
in accordance with the terms of this Agreement and (y) the date upon which the
predecessor Administrator shall become unable to act as Administrator as
specified in the notice of resignation and Depositoring Opinion of Counsel. In
the event of termination hereunder of the Administrator the Issuer shall appoint
a successor Administrator acceptable to the Indenture Trustee and the successor
Administrator shall accept its appointment by a written assumption in form
acceptable to the Indenture Trustee. In the event that a successor Administrator
has not been appointed at the time when the predecessor Administrator has ceased
to act as Administrator in accordance with this Section, the Indenture Trustee
without further action shall automatically be appointed the successor
Administrator and the Indenture Trustee shall be entitled to the Administration
Fee. Notwithstanding the above, the Indenture Trustee shall, if it shall be
unwilling or legally unable so to act, appoint or petition a court of competent
jurisdiction to appoint, any established institution whose regular business
shall include the servicing of student loans, as the successor to the
Administrator under this Agreement and the Administration Agreement.
(a) Upon appointment, the successor Administrator (including
the Indenture Trustee acting as successor Administrator) shall be the
successor in all respects to the predecessor Administrator and shall be
subject to all the responsibilities, duties and liabilities placed on
the predecessor Administrator that arise thereafter or are related
thereto and shall be entitled to an amount agreed to by such successor
Administrator (which shall not exceed the Administration Fee unless
such compensation arrangements will not result in a downgrading of the
rating of the Senior Notes or the Subordinate
- 21 -
Notes by any Rating Agency) and all the rights granted to the
predecessor Administrator by the terms and provisions of this
Agreement.
(b) The Administrator may not resign unless it is prohibited
from serving as such by law as evidenced by an Opinion of Counsel to
such effect delivered to the Indenture Trustee and the Trustee.
Notwithstanding the foregoing or anything to the contrary herein or in
the Related Agreements, the Indenture Trustee, to the extent it is
acting as successor Administrator pursuant hereto, shall be entitled to
resign to the extent a qualified successor Administrator has been
appointed and has assumed all the obligations of the Administrator in
accordance with the terms of this Agreement and the Related Agreements.
14. Notification to Noteholders. Upon any termination of, or
appointment of a successor to, the Administrator pursuant to Section 12 or 13,
the Indenture Trustee shall give prompt written notice thereof to Noteholders
and the Rating Agencies (which, in the case of any such appointment of a
successor, shall consist of prior written notice thereof to the Rating
Agencies).
15. Waiver of Past Defaults. The Noteholders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes may,
on behalf of all Noteholders, waive in writing any default by the Administrator
in the performance of its obligations hereunder and any consequences thereof,
except a default in making any required deposits to or payments from any of the
Trust Accounts (or giving instructions regarding the same) in accordance with
this Agreement. Upon any such waiver of a past default, such default shall cease
to exist, and any Administrator Default arising therefrom shall be deemed to
have been remedied for every purpose of this Agreement. No such waiver shall
extend to any subsequent or other default or impair any right consequent
thereto.
16. Notices. Any notice, report or other communication given
hereunder shall be in writing (or in the form of facsimile notice, followed by
written notice) and addressed as follows:
(a) if to the Issuer, to
EFG Student Loan Trust ____-_
with a copy to the Trustee
at the Corporate Trust Office of the
Trustee; and
if to the Trustee, to [___________] at
Attention:
Telephone:
Facsimile:
(b) if to the Eligible Lender Trustee, to
- 22 -
[ ], National Association
Attention: Corporate Trust Administration
Telephone:
Facsimile:
(c) if to the Administrator, to
Educational Finance Group, Inc.
Attention: President and Chief Executive Officer
Telephone:
Telecopy:
with a copy to
Office of the General Counsel
Attention:
Telephone:
Telecopy:
(d) if to the Indenture Trustee, to
[ ]
Attention: Corporate Trust and Agency Group,
Structured Finance Team
Telephone:
Facsimile:
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed given
if such notice is mailed by certified mail, postage prepaid, or hand-delivered
to the address of such party as provided above.
17. Amendments. This Agreement may be amended from time to
time by a written amendment duly executed and delivered by the Issuer, the
Administrator and the Indenture Trustee, with the written consent of the
Eligible Lender Trustee, without the consent of the Noteholders, for the purpose
of adding any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Noteholders; provided that such amendment will not, in an Opinion of Counsel
obtained on behalf of the Issuer and satisfactory to the Indenture Trustee and
the Eligible Lender Trustee, materially and adversely affect the interest of any
Noteholder. This Agreement may also be
- 23 -
amended by the Issuer, the Administrator and the Indenture Trustee with the
written consent of the Eligible Lender Trustee and the Noteholders of at least a
majority in the Outstanding Amount of the Notes for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement or of modifying in any manner the rights of Noteholders;
provided, however, that no such amendment may (i) increase or reduce in any
manner the amount of, or accelerate or delay the timing of, collections of
payments with respect to Student Loans or distributions that are required to be
made for the benefit of the Noteholders or (ii) reduce the aforesaid percentage
of the Noteholders which are required to consent to any such amendment, without
the consent of all Outstanding Noteholders. Prior to the execution of any such
amendment, the Administrator shall furnish written notification of the substance
of such amendment to each of the Rating Agencies.
18. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 13 or 25 of this Agreement
concerning the resignation of the Administrator, this Agreement may not be
assigned by the Administrator.
19. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
20. Headings. The section headings hereof have been inserted
for convenience of reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.
21. Counterparts. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.
22. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
23. Not Applicable to Educational Finance Group, Inc. in Other
Capacities. Nothing in this Agreement shall affect any obligation Educational
Finance Group, Inc. may have in any other capacity under the Related Agreements.
24. Liability of Administrator; Indemnities. The Administrator
shall be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Administrator under this Agreement.
The Administrator shall indemnify, defend and hold harmless
the Issuer, the Trustee, the Eligible Lender Trustee, the Indenture Trustee, the
Servicer and the Noteholders and any of the officers, directors, employees and
agents of the Issuer, the Trustee, the Eligible Lender Trustee, the Indenture
Trustee and the Servicer from and against any and all costs, expenses,
- 24 -
losses, claims, damages and liabilities to the extent that such cost, expense,
loss, claim, damage or liability arose out of, or was imposed upon any such
Person through, the negligence, willful misfeasance or bad faith of the
Administrator in the performance of its duties under this Agreement or by reason
of reckless disregard of its obligations and duties hereunder or thereunder.
The Administrator shall pay reasonable compensation to the
Indenture Trustee and shall reimburse the Indenture Trustee for all reasonable
expenses, disbursements and advances, and indemnify, defend and hold harmless
the Indenture Trustee and its officers, directors, employees and agents from and
against all costs, expenses, losses, claims, damages and liabilities, to the
extent and in the manner provided in, and subject to the limitations of, Section
6.07 of the Indenture.
For purposes of this Section, in the event of the termination
of the rights and obligations of the Administrator (or any successor thereto
pursuant to Section 25) as Administrator pursuant to Section 12 or a resignation
by such Administrator pursuant to this Agreement, such Administrator shall be
deemed to be the Administrator pending appointment of a successor Administrator
pursuant to Section 13.
Indemnification under this Section shall survive the
resignation or removal of the Trustee, the Eligible Lender Trustee or the
Indenture Trustee or the termination of this Agreement and shall include
reasonable fees and expenses of counsel and expenses of litigation. If the
Administrator shall have made any indemnity payments pursuant to this Agreement
and the Person to or on behalf of whom such payments are made thereafter
collects any of such amounts from others, such Person shall promptly repay such
amounts to the Administrator, without interest.
25. Merger or Consolidation of, or Assumption of the
Obligations of, Administrator. Any Person (a) into which the Administrator may
be merged or consolidated, (b) which may result from any merger or consolidation
to which the Administrator shall be a party or (c) which may succeed to the
properties and assets of the Administrator substantially as a whole, shall be
the successor to the Administrator without the execution or filing of any
document or any further act by any of the parties to this Agreement; provided,
however, that the Administrator hereby covenants that it will not consummate any
of the foregoing transactions except upon satisfaction of the following: (i) the
surviving Administrator, if other than Educational Finance Group, LLP, executes
an agreement of assumption to perform every obligation of the Administrator
under this Agreement, (ii) immediately after giving effect to such transaction,
no representation or warranty made pursuant to Section 1 shall have been
breached and no Administrator Default, and no event that, after notice or lapse
of time, or both, would become an Administrator Default shall have occurred and
be continuing, (iii) the Administrator shall have delivered to the Trustee and
the Indenture Trustee an Officers' Certificate and an Opinion of Counsel each
stating that such consolidation, merger or succession and such agreement of
assumption comply with this Section and that all conditions precedent, if any,
provided for in this Agreement relating to such transaction have been complied
with, and that the Rating Agency Condition shall have been satisfied with
respect to such transaction, (iv) the surviving Administrator shall have a
consolidated net worth at least equal to that of the predecessor
- 25 -
Administrator, (v) such transaction will not result in a material adverse
Federal or state tax consequence to the Issuer or the Noteholders and (vi)
unless Educational Finance Group, LLP is the surviving entity, the Administrator
shall have delivered to the Trustee and the Indenture Trustee an Opinion of
Counsel either (A) stating that, in the opinion of such counsel, all financing
statements and continuation statements and amendments thereto have been executed
and filed that are necessary fully to preserve and protect the interest of the
Trustee and Indenture Trustee, respectively, in the Student Loans and reciting
the details of such filings, or (B) stating that, in the opinion of such
counsel, no such action shall be necessary to preserve and protect such
interests.
26. Limitation on Liability of Administrator and Others.
Neither the Administrator nor any of its directors, officers, employees or
agents shall be under any liability to the Issuer, the Noteholders, the Trustee,
the Indenture Trustee or the Eligible Lender Trustee except as provided under
this Agreement, for any action taken or for refraining from the taking of any
action pursuant to this Agreement or for errors in judgment; provided, however,
that this provision shall not protect the Administrator or any such person
against any liability that would otherwise be imposed by reason of willful
misfeasance, bad faith or negligence in the performance of its duties or by
reason of reckless disregard of obligations and its duties under this Agreement.
The Administrator and any of its directors, officers, employees or agents may
rely in good faith on the advice of counsel or on any document of any kind prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder.
Except as provided in this Agreement, the Administrator shall
not be under any obligation to appear in, prosecute or defend any legal action
that shall not be incidental to its duties to administer the Student Loans and
the Trust in accordance with this Agreement, and that in its opinion may involve
it in any expense or liability; provided, however, that the Administrator may
undertake any reasonable action that it may deem necessary or desirable in
respect of this Agreement and the other Basic Documents and the rights and
duties of the parties to this Agreement and the Related Agreements and the
interests of the Noteholders under the Indenture.
27. Educational Finance Group, Inc. Not to Resign as
Administrator. Subject to the provisions of Section 25, Educational Finance
Group, Inc. shall not resign from the obligations and duties imposed on it as
Administrator under this Agreement except upon determination that the
performance of its duties under this Agreement shall no longer be permissible
under applicable law or shall violate any final order of a court or
administrative agency with jurisdiction over Educational Finance Group, Inc. or
its properties. Notice of any such determination permitting the resignation of
Educational Finance Group, Inc. shall be communicated to the Trustee, the
Eligible Lender Trustee and the Indenture Trustee at the earliest practicable
time (and, if such communication is not in writing, shall be confirmed in
writing at the earliest practicable time) and any such determination shall be
evidenced by an Opinion of Counsel to such effect delivered to the Trustee, the
Eligible Lender Trustee and the Indenture Trustee concurrently with or promptly
after such notice. No such resignation shall become effective until the
Indenture Trustee or a successor Administrator shall have assumed the
responsibilities and obligations of Educational Finance Group, Inc. in
accordance with Section 13.
- 26 -
28. Limitation of Liability of Eligible Lender Trustee and
Indenture Trustee. Notwithstanding anything contained herein to the contrary,
this instrument has been countersigned by [TRUSTEE], National Association not in
its individual capacity but solely in its capacity as Trustee of the Issuer and
in no event shall [TRUSTEE], National Association in its individual capacity or
any Owner of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder, as to all of
which recourse shall be had solely to the assets of the Issuer. For all purposes
of this Agreement, in the performance of any duties or obligations of the Issuer
thereunder, the 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.
Notwithstanding anything contained herein to the contrary,
this Agreement has been countersigned by [ ] and [ ] not in their
individual capacities but solely as [Eligible Lender Trustee and] Indenture
Trustee and in no event shall [ ] and [ ] have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.
29. Insolvency of Depositor. (a) Upon any sale of the assets
of the Trust pursuant to Section 9.02 of the Trust Agreement, the Indenture
Trustee shall deposit the net proceeds from such sale after all payments and
reserves therefrom (including the expenses of such sale) have been made (the
"Insolvency Proceeds") in the Collection Account. On the Quarterly Payment Date
on, or, if such proceeds are not so deposited on a Quarterly Payment Date, on
the first Quarterly Payment Date following the date on which the Insolvency
Proceeds are deposited in the Collection Account, the Administrator shall
instruct the Indenture Trustee to make the following distributions (after the
application on such Quarterly Payment Date of the amount of Available Funds and
amounts on deposit in the Reserve Account pursuant to Sections 2(d) and 2(e))
from the Insolvency Proceeds and any funds remaining on deposit in the Reserve
Account (including the proceeds of any sale of investments therein as described
in the following sentence):
(i) to the Senior Noteholders, any portion of the
Senior Noteholders' Interest Distribution Amount not otherwise
distributed to the Senior Noteholders on such Quarterly
Payment Date;
(ii) to the Subordinate Noteholders, any portion of
the Subordinate Noteholders' Interest Distribution Amount not
otherwise distributed to the Subordinate Noteholders on such
Quarterly Payment Date;
(iii) to the Senior Noteholders, the outstanding
principal balance of the Senior Notes (after giving effect to
the reduction in the outstanding principal balance of the
Senior Notes to result from the distributions to Senior
Noteholders on such Quarterly Payment Date and on prior
Quarterly Payment Dates);
(iv) to the Subordinate Noteholders, the outstanding
principal balance of the Subordinate Notes (after giving
effect to the reduction in the outstanding principal balance
of the Subordinate Notes to result from the distributions to
- 27 -
Subordinate Noteholders on such Quarterly Payment Date and on
prior Quarterly Payment Dates);
(v) to the Senior Noteholders, any unpaid Senior
Noteholders' Interest T-Xxxx Carryover not otherwise
distributed to the Senior Noteholders on such Quarterly
Payment Date; and
(vi) to the Subordinate Noteholders, any unpaid
Subordinate Noteholders' Interest T-Xxxx Carryover not
otherwise distributed to the Subordinate Noteholders on such
Quarterly Payment Date. Any investments on deposit in the
Reserve Account which will not mature on or before such
Quarterly Payment Date shall be sold by the Indenture Trustee
at such time as will result in the Indenture Trustee receiving
the proceeds from such sale not later than the Business Day
preceding such Quarterly Payment Date. Any Insolvency Proceeds
remaining after the deposits described above shall be paid to
the Depositor.
(b) As described in Article IX of the Trust Agreement,
notice of any termination of the Trust shall be given by the
Administrator to the Trustee and the Indenture Trustee as soon as
practicable after the Administrator has received notice thereof.
30. Third-Party Beneficiaries. The Eligible Lender Trustee is
a third party beneficiary to this Agreement and is entitled to the rights and
benefits hereunder and may enforce the provisions hereof as if it were a party
hereto.
- 28 -
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered as of the day and year first above
written.
EFG STUDENT LOAN TRUST 1999-[ ]
by [ ], NATIONAL ASSOCIATION, not
in its individual capacity but solely as
Trustee,
by
--------------------------------------
Name:
Title:
[INDENTURE TRUSTEE] and not in its
individual capacity but solely as
Indenture Trustee,
by
--------------------------------------
Name:
Title:
EDUCATIONAL FINANCE GROUP, Inc., as
Administrator,
by
--------------------------------------
Name:
Title:
- 29 -
EXHIBIT A TO THE
ADMINISTRATION AGREEMENT
POWER OF ATTORNEY
STATE OF NEW YORK )
) ss.:
COUNTY OF NEW YORK )
KNOW ALL MEN BY THESE PRESENTS, that [ ], NATIONAL
ASSOCIATION, a national bank, not in its individual capacity but solely as
trustee ("Trustee") for the EFG Student Loan Trust ____-_ (the "Trust"), does
hereby make, constitute and appoint Educational Finance Group, Inc., as
Administrator under the Administration Agreement (as defined below), and its
agents and attorneys, as Agents and Attorneys-in-Fact to execute on behalf of
Trustee or the Trust all such documents, reports, filings, instruments,
certificates and opinions as it should be the duty of Trustee or the Trust to
prepare, file or deliver pursuant to the Related Documents (as defined in the
Administration Agreement) or pursuant to Section 5.02 of the Trust Agreement (as
defined in the Administration Agreement), including without limitation, to
appear for and represent Trustee and the Trust in connection with the
preparation, filing and audit of any federal, state and local tax returns
pertaining to the Trust, and with full power to perform any and all acts
associated with such returns and audits that the Trustee could perform,
including without limitation, the right to distribute and receive confidential
information, defend and assert positions in response to audits, initiate and
defend litigation, and to execute waivers of restriction on assessments of
deficiencies, consents to the extension of any statutory or regulatory time
limit, and settlements. For the purpose of this Power of Attorney, the term
"Administration Agreement" means the Administration Agreement dated as of
_______ __, 1999, among the Trust, Educational Finance Group, Inc., as
Administrator, and [ ], as Indenture Trustee, as such may be amended from
time to time.
All powers of attorney for this purpose heretofore filed or
executed by Trustee are hereby revoked.
EXECUTED as of the _______ day of _______, 1999.
[ ], NATIONAL ASSOCIATION, not in its
individual capacity but solely as Trustee
by
--------------------------------------
Name:
Title:
X-0
XXXXX XX XXX XXXX )
) ss.:
COUNTY OF NEW YORK )
Before me, the undersigned authority, on this day personally
appeared [ ] known to me to be the person whose name is subscribed to the
foregoing instrument, and acknowledged to me that such person signed the same
for the purposes and considerations therein expressed.
GIVEN UNDER MY HAND AND SEAL OF OFFICE this [ ] day of [ ], 1999.
------------------------------
Notary Public in and for the
State of New York
------------------------------
Printed Name of Notary Public
Commission Expires
-----------
A-2
EXHIBIT B
TO THE
ADMINISTRATION AGREEMENT
Form of Noteholders' Statement pursuant to Section 2(g) of Administration
Agreement (capitalized terms used herein are defined in Appendix A thereto)
Quarterly Payment Date: _____________________
(i) Amount of principal being paid or distributed:
Senior __________* ($_______* per $1,000 original
principal amount of Notes)
Subordinate __________* ($_______* per $1,000 original
principal amount of Notes)
---------
* Portion of each such amount attributable to Reserve Account Excess: _________.
(ii) Amount of interest being paid or distributed:
Senior __________ ($_______ per $1,000 original
principal amount of Notes)
Subordinate __________ ($_______ per $1,000 original
principal amount of Notes)
(iii) Amount of Senior Noteholders' Interest T-Xxxx Carryover being paid or
distributed (if any) and amount remaining (if any):
(a) Distributed:__________ ($_______ per $1,000 original
principal amount of Notes)
(b) Balance:______________ ($_______ per $1,000 original
principal amount of Notes)
(iv) Amount of Subordinate Noteholders' Interest T-Xxxx Carryover being paid
or distributed (if any) and amount remaining (if any):
(a) Distributed:__________ ($_______ per $1,000 original
principal amount of Notes)
B-1
(b) Balance:______________ ($_______ per $1,000 original)
principal amount of Notes)
(v) Pool Balance at end of related Collection Period: __________
(vi) After giving effect to distributions on this Quarterly Payment Date:
(a) (1) outstanding principal amount of Senior Notes:________
(2) Senior Note Pool Factor:__________
(b) (1) outstanding principal amount of Subordinate Notes:___
(2) Subordinate Note Pool Factor:__________
(vii) Applicable Note Rate:
In general:
(1) T-Xxxx Rate for Quarterly Interest Period commencing on the
previous Quarterly Payment Date was _______%.
(2) the Student Loan Rate was _____%.
Senior Note Rate:_____% (based on
[T-Xxxx Rate]
[Student Loan Rate])
Subordinate Note Rate:_____% (based on
[T-Xxxx Rate]
[Student Loan Rate])
(viii) Amount of Servicing Fee for related Collection Period including a
breakdown of the components of the Servicing Fee attributable to each
of the items specified in clauses II(i) through (ix) of Section 3.06 of
the Servicing Agreement and the amount of any Servicing Fee Shortfall
for such Quarterly Payment Date and for each Monthly Payment Date
following the immediately preceding Quarterly Payment Date:
(ix) Amount of Administration Fee for related Collection
Period:__________ ($_______ per $1,000 original principal amount of
Notes)
(x) Aggregate amount of Realized Losses (if any) for the related
Collection Period:__________
(xi) Financed Student Loans delinquent at end of related Collection Period:
number of delinquent loans: ________; aggregate unpaid principal
balance of delinquent loans: ___________________
B-2
(xii) Withdrawal from Reserve Account on related Quarterly Payment Date
(other than Reserve Account Excess) and on any Monthly Payment Date
since the preceding Quarterly Payment Date (list each withdrawal
separately): _______________ [purpose of each withdrawal]
Reserve Account Excess on related Quarterly Payment Date $________
Principal balance of Notes to be paid to reach Parity Date: $_______
(xiii) Deposits to Collateral Reinvestment Account during related Collection
Period: $__________; amount to be deposited on related Quarterly
Payment Date $___________.
Withdrawal from Collateral Reinvestment Account during related
Collection Period: $__________
(xiv) Amount in the Reserve Account (after giving effect to (xii)):__________
(xv) Amount in the Collateral Reinvestment Account (after giving effect to
(xiii)):__________
(xvi) Consolidation loans: ___________ loans with aggregate principal balance
of $________ were originated during related Collection Period;
withdrawal from Collateral Reinvestment Account to fund origination of
Consolidation Loans during related Collection Period: $_______
(xvii) Add-on Consolidation Loans: ______ loans with aggregate principal
balance of $________ were added to the principal balance of a
Consolidation Loan; withdrawal from Collateral Reinvestment Account to
fund the addition of the principal balances of Add-on Consolidation
Loans during the related Collection Period: $________
(xviii) Serial Loans: _______ loans with aggregate principal balance of
$_______ (portion represented by Purchase Premium Amounts $________)
were purchased during the related Collection Period.
(xix) New Loans: _______ loans with aggregate principal balance of $_______
(portion represented by Purchase Premium Amounts $________) were
purchased during the related Collection Period.
(xx) Financed Student Loans in the following categories as of the end of the
related Collection Period:
Weighted Average Number of Principal
Interest Rate Loans Balance
Status Type:
In-School
Grace
B-3
Repayment
Forbearance
Deferment
Delinquencies
Claims Filed Awaiting Payment
Delinquencies:
--------------
30-60 Days
61-90 Days
91-120 Days
More than 120 Days Delinquent
Claims Filed Awaiting Payment
Loan Type:
--------------
Xxxxxxxx Loans
SLS Loans
PLUS Loans
Consolidation Loans
School Type:
--------------
Traditional
Vocational/Proprietary
B-4
APPENDIX A TO THE
ADMINISTRATION AGREEMENT
[FORM OF]
DEFINITIONS AND USAGE
Usage
-----
The following rules of construction and usage shall be
applicable to any instrument that is governed by this Appendix:
a) All terms defined in this Appendix shall have the defined
meanings when used in any instrument governed hereby and in any certificate or
other document made or delivered pursuant thereto unless otherwise defined
therein.
b) As used herein, in any instrument governed hereby and in
any certificate or other document made or delivered pursuant thereto,
accounting terms not defined in this Appendix or in any such instrument,
certificate or other document, and accounting terms partly defined in this
Appendix or in any such instrument, certificate or other document to the
extent not defined, shall have the respective meanings given to them under
generally accepted accounting principles as in effect on the date of such
instrument. To the extent that the definitions of accounting terms in this
Appendix or in any such instrument, certificate or other document are
inconsistent with the meanings of such terms under generally accepted
accounting principles, the definitions contained in this Appendix or in any
such instrument, certificate or other document shall control.
c) The words "hereof", "herein", "hereunder" and words of
similar import when used in an instrument refer to such instrument as a whole
and not to any particular provision or subdivision thereof; references in an
instrument to "Article", "Section" or another subdivision or to an attachment
are, unless the context otherwise requires, to an article, section or
subdivision of or an attachment to such instrument; and the term "including"
means "including without limitation".
d) The definitions contained in this Appendix are equally
applicable to both the singular and plural forms of such terms and to the
masculine as well as to the feminine and neuter genders of such terms.
e) Any agreement, instrument or statute defined or referred
to below or in any agreement or instrument that is governed by this Appendix
means such agreement or instrument or statute as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes) by succession of comparable
successor statutes and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein. References to a Person are also to its permitted
successors and assigns.
Definitions
-----------
"Act" has the meaning specified in Section 11.03(a) of the
Indenture.
"Additional Fundings" means any withdrawals from the
Collateral Reinvestment Account for any of the purposes set forth in Section
2(f) of the Administration Agreement.
"Additional Guarantor" means a Federal Guarantor (other than
an Initial Guarantor) of a FFELP Student Loan (other than an Initial Student
Loan) which has entered into a guarantee agreement with the Eligible Lender
Trustee or a Private Guarantor of a Private Student Loan.
"Add-on Consolidation Loan" means a Student Loan, the
principal balance of which is added to an existing Consolidation Loan within
210 days from the date that the existing Consolidation Loan was made, as
required by the Higher Education Act.
"Add-on Consolidation Loan Funding Date" means each day,
prior to the end of the Add-on Period, on which the principal balance of an
Add-on Consolidation Loan is added to the principal balance of a Consolidation
Loan in the Trust pursuant to Section 6.07 of the Trust Agreement.
"Add-on Period" means the period starting on the closing
Date and ending on the date that is 210 days from the date that the last
Consolidation Loan was originated by the Trust during the Revolving Period.
"Administration Agreement" means the Administration
Agreement dated as of [__________ __, 1999], among the Issuer, the
Administrator and the Indenture Trustee.
"Administration Fee" means, with respect to each Monthly
Payment Date, an amount equal to one-twelfth of the product of (i) [ ]% and
(ii) the Pool Balance as of the close of business on the last day of the
calendar month immediately preceding such Monthly Payment Date.
"Administrator" means Educational Finance Group, Inc., a
Texas limited liability partnership, in its capacity as administrator of the
Issuer and the Financed Student Loans.
"Administrator Default" shall have the meaning set forth in
Section 12 of the Administration Agreement.
"Administrator's Certificate" means an Officers' Certificate
of the Administrator delivered pursuant to Section 2(g) of the Administration
Agreement, substantially in the form of Exhibit B thereto.
2
"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, whetherthrough the
ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Assignment" means a duly executed assignment delivered
pursuant to Section 3.02 of the Loan Sale Agreement in the form set forth in
Exhibit F to such Agreement.
"Authorized Officer" means (i) with respect to the Issuer,
any officer of the Trustee who is authorized to act for the Trustee in matters
relating to the Issuer pursuant to the Basic Documents and who is identified
on the list of Authorized Officers delivered by the Trustee to the Indenture
Trustee on the Closing Date (as such list may be modified or supplemented from
time to time thereafter) and (ii) with respect to the Seller, the Servicer and
the Administrator, any officer of the Seller, the Servicer or the
Administrator, respectively, who is authorized to act for the Seller, the
Servicer or the Administrator, respectively, in matters relating to itself or
to the Issuer and to be acted upon by the Seller, the Servicer or the
Administrator, respectively, pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Seller, the
Servicer and the Administrator, respectively, to the Indenture Trustee on the
Closing Date (as such list may be modified or supplemented from time to time
thereafter).
"Available Funds" means, with respect to a Quarterly Payment
Date and the related Collection Period, the sum of the amounts specified in
clauses (i)-(vi) of the definition of Monthly Available Funds for each of the
three Monthly Collection Periods included in such Collection Period; provided,
however, that if with respect to any Quarterly Payment Date there would not be
sufficient funds, after application of Available Funds (as defined above) and
amounts available from the Reserve Account, to pay any of the items specified
in clauses (v)(A) through (v)(C) of Section 2(d) of the Administration
Agreement, then Available Funds for such Quarterly Payment Date will include,
in addition to the Available Funds (as defined above), amounts on deposit in
the Collection Account on the Determination Date relating to such Quarterly
Payment Date which would have constituted Available Funds for the Quarterly
Payment Date succeeding such Quarterly Payment Date up to the amount necessary
to pay suc items, and the Available Funds for such succeeding Quarterly
Payment Date will be adjusted accordingly; and provided, further, that
Available Funds will exclude (A) all payments and proceeds (including
Liquidation Proceeds) of any Financed Student Loans the Purchase Amount of
which has been included in Available Funds for a prior Collection Period; (B)
except as expressly included in clause (iv) of the definition of Monthly
Available Funds, amounts released from the Collateral Reinvestment Account;
(C) an Monthly Rebate Fees paid during the related Collection Period by or on
behalf of the Trust; (D) any collections in respect of principal on the
Financed Student Loans applied by the Eligible Lender Trustee on behalf of the
Trust prior to the end of the Revolving Period to make deposits to the
Collateral Reinvestment Account pursuant to Section 2(d)(i) of the
Administration Agreement, and after the end of the Revolving Period, any
expenditure of the Net Principal Cash Flow Amount used
3
to fund the addition o any Add-on Consolidation Loans, to purchase Serial
Loans or to fund the acquisition of Exchanged Serial Loans during the related
Collection Period; and (E) the Servicing Fee, all overdue Servicing Fees, the
Administration Fee and all overdue Administration Fees paid on each Monthly
Payment Date that is not a Quarterly Payment Date during the related
Collection Period.
"Basic Documents" means the Trust Agreement, the Indenture,
the Eligible Lender Trust Agreement, the Loan Sale Agreement, the Servicing
Agreement, the Administration Agreement, the Depository Agreement, the
Guarantee Agreements and other documents and certificates delivered in
connection with any thereof.
"Book-Entry Note" means a beneficial interest in the Senior
Notes, ownership and transfers of which shall be made through book entries by
a Clearing Agency as described in Section 2.10 of the Indenture.
"Borrower" means an individual who is the maker of a
Borrower Note and who obtains a Student Loan from an "eligible lender" in
accordance with the Higher Education Act (in the case of FFELP Student Loans)
and the policies and procedures of a Guarantor.
"Borrower Account" means those combined loans of a Borrower
with the same lender and branch, which loans are in the same status, are the
same loan type and which require the same processing and billing requirements.
Xxxxxxxx Loans which are already in repayment and being serviced by the
Servicer will not be merged with new Xxxxxxxx Loans for the same Borrower, and
each such Xxxxxxxx Loan will be treated as a separate Borrower Account.
"Borrower Note" means a promissory note of a Borrower for a
Student Loan set forth on the appropriate form furnished by the Guarantor
which Borrower Note meets the criteria set forth by the Higher Education Act
(in the case of FFELP Student Loans) and the policies and procedures of the
Guarantor.
"Business Day" means any day other than a Saturday, a Sunday
or a day on which banking institutions or trust companies in the State of
[Illinois, New York or Texas] are authorized or obligated by law, regulation
or executive order to remain closed.
"Business Trust Statute" means Chapter 38 of Title 12 of the
Delaware Code, 12 Del. Code ss. 3801 et seq., as the same may be amended from
time to time.
"Capitalized Interest Amount" means for any Monthly
Collection Period or other period of determination, the amount of interest
that accrued on the Financed Student Loans during such period but was not then
payable and that has been or will, pursuant to the terms of such Financed
Student Loans, be capitalized and added to the principal balances of such
loans.
4
"Certificate of Trust" means the Certificate of Trust in the
form of Exhibit A to the Trust Agreement to be filed for the Trust pursuant to
Section 3810(a) of the Business Trust Statute.
["_________Program" means the [Incentive Program] of the
Seller which provides that Borrowers of Xxxxxxxx Loans whose loans were
disbursed on or after[_____________] and who make their first payments on time
receive a __% per annum interest rate reduction for the remaining term of
their Student Loan, as such program may be modified from time to time.]
["__________Program" means the Incentive Program of the
Seller which provides for Borrowers of Xxxxxxxx Loans whose loans were
disbursed on or after _______________ and who use the [ ] to remit payments
directly from their bank accounts to receive a __% per annum interest rate
reduction on their Student Loans, as such program may be modified after the
Cutoff Date, other than as it may be modified to increase such interest rate
reduction.]
"Clearing Agency" means an organization registered as a
"clearing agency" pursuant to Section 17A of the Exchange Act.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities
deposited with the Clearing Agency.
"Closing Date" means __________ __, 1999.
"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.
"Collateral Reinvestment Account" means the account
designated as such, established and maintained pursuant to Section 2(c) of the
Administration Agreement.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 2(c) of the Administration
Agreement.
"Collection Period" means, with respect to the first
Quarterly Payment Date, the period beginning on the Cutoff Date and ending on
[ 1999], and with respect to each subsequent Quarterly Payment Date, the
Collection Period means the three calendar months immediately following the
end of the previous Collection Period.
"Commission" means the Securities and Exchange Commission.
"Company" means Educational Finance Group, Inc., a Delaware
corporation.
5
"Company Note" means the Subordinate Note in a principal
amount of $[ ] which is required to be retained by the Company pursuant to
Section 2.13 of the Indenture and which is nontransferable.
"Consolidation Fee" means any Federal Origination Fee,
Monthly Rebate Fee or similar fee payable to the Department relating to the
origination or ownership of Consolidation Loans.
"Consolidation Loan" means a Student Loan made pursuant to
the Higher Education Act to consolidate the Borrower's obligations under
various federally authorized student loan programs into a single loan, as
supplemented by the addition of any related Add-on Consolidation Loans.
"Corporate Trust Office" means (i) with respect to the
Indenture Trustee, the principal office of the Indenture Trustee at which at
any particular time its corporate trust business shall be administered, which
office at the Closing Date is located at [ ]; or at such other address as the
Indenture Trustee may designate from time to time by notice to the Noteholders
and the Depositor, or the principal corporate trust office of any successor
Indenture Trustee (the address of which the successor Indenture Trustee will
notify the Noteholders and the Depositor); (ii) with respect to the Eligible
Lender Trustee, the principal corporate trust office of the Eligible Lender
Trustee located at [ ]; or at such other address as the Eligible Lender
Trustee may designate by notice to the Depositor, or the principal corporate
trust office of any successor Eligible Lender Trustee (the address of which
the successor Eligible Lender Trustee will notify the Depositor) and (iii)
with respect to the Eligible Lender Trustee, the principal corporate trust
office of the Eligible Lender Trustee located at [ ]; or at such other address
as the Eligible Lender Trustee may designate by notice to the Depositor, or
the principal corporate trust office of any successor Eligible Lender Trustee
(the address of which the successor Eligible Lender Trustee will notify the
Depositor).
"Custodian" means [CUSTODIAN] and/or [____________], each,
if more than one in its capacity as custodian of the Borrower Notes or any
permitted successor Custodian.
"Cutoff Date" means [ 1999].
"Default" means any occurrence that is, or with notice or
the lapse of time or both would become, an Event of Default.
"Deferral" means the period defined by the Higher Education
Act and the policies of the related Guarantor during which a Borrower (in
Repayment) is entitled to postpone making payments upon the submission of
appropriate documentation.
"Deferral Loan" means a Student Loan during a period of
Deferral.
"Definitive Notes" has the meaning specified in Section 2.10
of the Indenture.
6
"Delaware Trust" has the meaning specified in Section 10.01
of the Trust Agreement.
"Delaware Trustee" has the meaning set forth in Section
10.01 of the Trust Agreement.
"Deleted Student Loan" has the meaning specified in Section
3.02 of the Loan Sale Agreement.
"Delinquency Percentage" means, as of any date of
determination, the percentage equivalent of a fraction the numerator of which
is the aggregate principal balance of the FFELP Student Loans which are
Repayment Loans and which either (a) are over 120 days delinquent or (b) have
had claims filed with the Department for which payment is still awaited, and
the denominator of which is the aggregate principal balance of the FFELP
Student Loans which are Repayment Loans.
"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 9-105(1)(i) 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 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 financial intermediary (as defined in Section
8-313) of the UCC) and the making by such financial 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 financial 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(3) 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 accoun of a
financial 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 financial
intermediary, the maintenance of such certificated securities by such
clearing corporation or a "custodian bank" (as defined in Section
8-102(4) of the UCC) or the nominee of either subject to the clearing
corporation's exclusive control, the sending of a confirmation by the
financial intermediary of the purchase by the Indenture Trustee or its
nominee or custodian of such securities and the making by such financial
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, "Physical
7
Property"), and, in any event, any such Physical Property in registered
form shall be in the name of the Indenture Trustee or its nominee or
custodian; 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 securities issued by the U.S.
Treasury, the Federal Home Loan Mortgage Corporation or by the Federal
National Mortgage Association that is a book-entry security held through
the Federal Reserve System pursuant to Federal book-entry regulations,
the following procedures, all in accordance with applicable law,
including applicable Federal regulations and Articles 8 and 9 of the
UCC: book-entry registration of such Trust Account Property to an
appropriate book-entry account maintained with a Federal Reserve Bank by
a financial intermediary which is also a "depository" pursuant to
applicable Federal regulations and issuance by such financial
intermediary of a deposit advice or other written confirmation of such
book-entry registration to the Indenture Trustee or its nominee or
custodian of the purchase by the Indenture Trustee or its nominee or
custodian of such book-entry securities; the making by such financial
intermediary of entries in its books and records identifying such
book-entry security held through the Federal Reserve System pursuant to
Federal book-entry regulations as belonging to the Indenture Trustee or
its nominee or custodian and indicating that such custodian holds such
Trust Account Property solely as agent for the Indenture Trustee or its
nominee or custodian; and such additional or alternative procedures as
may hereafter become appropriate to effect 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; 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 financial
intermediary, the sending of a confirmation by the financial
intermediary of the purchase by the Indenture Trustee or its nominee or
custodian of such uncertificated security, the making by such financial
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 the EFG Funding in its capacity as
Depositor under the Trust Agreement.
"Depository Agreement" means the agreement with respect to
the Senior Notes attached to the Indenture as Exhibit B.
8
"Determination Date" means, with respect to any Monthly
Payment Date, the third Business Day preceding such Monthly Payment Date.
"Early Amortization Event" means any of the following
events:
(i) an Event of Default occurring under the Indenture,
a Servicer Default occurring under the Servicing Agreement or an
Administrator Default occurring under the Administration Agreement;
(ii) the Issuer becoming subject to registration as an
investment company under the Investment Company Act of 1940, as amended;
(iii) as of the end of any Collection Period,
the percentage by principal balance of Student Loans the Borrowers of
which use such loans to attend schools identified by the related
Guarantor as proprietary or vocational exceeds 30% of the Pool Balance;
(iv) as of the end of any Collection Period,
the percentage by principal balance of FFELP Student Loans which are not
in repayment and are not eligible for Interest Subsidy Payments exceeds
40% of the Pool Balance;
(v) the Excess Spread, with respect to each of
any two successive Quarterly Payment Dates, commencing with the
Quarterly Payment Date in October 1997, is less than 1%; or
(vi) the arithmetic average of the Delinquency
Percentage as of the end of each of two successive Collection Periods
exceeds 20%.
"Educational Institution" means any institution of higher
education that participates in the guaranteed loan programs authorized by
Title IV of the Higher Education Act and which is deemed eligible by a
Guarantor to participate in such Guarantor's program.
"EFG" means Educational Finance Group, LLP a limited
liability partnership organized under the laws of the State of Texas.
"EFG Funding" means EFG Funding Corporation, a corporation
organized under the laws of the State of Delaware.
"EFG Subsequent Transfer Agreement" has the meaning provided
in Section 2.03 of Loan Sale Agreement.
"EFG Trustee" means the First National Bank of Chicago, as
eligible lender trustee for EFG.
"Eligible Deposit Account" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with
the corporate trust department of a depository institution organized under the
laws of the United States of America or any one of
9
the States (or any domestic branch of a foreign bank), having corporate trust
powers and acting as trustee for funds deposited in such account, so long as
any of the securities of such depository institution have a credit rating from
each Rating Agency in one of its generic rating categories which signifies
investment grade.
"Eligible Institution" means a depository institution
organized under the laws of the United States of America or any one of the
States (or any domestic branch of a foreign bank), which (i) has (A) either a
long-term senior unsecured debt rating of AAA or a short-term senior unsecured
debt or certificate of deposit rating of A-1+ by Standard & Poor's 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 by Xxxxx'x, or any other long-term,
short-term or certificate of deposit rating acceptable to the Rating Agencies
and (C) unsecured debt rating of AAA (if rated by Fitch) or a short-term
senior unsecured debt or certificate of deposit rating of F-1+ (if rated by
Fitch) by Fitch and (ii) whose deposits are insured by the FDIC. If so
qualified, the Trustee or the Indenture Trustee may be considered an Eligible
Institution.
"Eligible Investments" means book-entry securities,
negotiable instruments or securities represented by instruments in bearer or
registered form which evidence:
a) direct obligations of, and obligations fully
guaranteed as to timely payment by, the United States of America;
b) demand deposits, time deposits or certificates of
deposit of any depository institution or trust company incorporated
under the laws of the United States of America or any State (or any
domestic branch of a foreign bank) and subject to supervision and
examination by Federal or state banking or depository institution
authorities (including depository receipts issued by any such
institution or trust company as custodian with respect to any obligation
referred to in clause (a) above or portion of such obligation for the
benefit of the holders of such depository receipts); provided, however,
that at the time of the investment or contractual commitment to invest
therein (which shall be deemed to be made again each time funds are
reinvested following each Quarterly Payment Date), the commercial paper
or other short-term senior unsecured debt obligations (other than such
obligations the rating of which is based on the credit of a Person other
than such depository institution or trust company) thereof shall have a
credit rating from each of the Rating Agencies in the highest investment
category granted thereby;
c) commercial paper having, at the time of the
investment or contractual commitment to invest therein, a rating from
each of the Rating Agencies in the highest investment category granted
thereby;
d) investments in money market funds having a rating
from each of the Rating Agencies in the highest investment category
granted thereby (including funds for which the Indenture Trustee, the
Servicer or the Eligible Lender Trustee or any of their respective
Affiliates is investment manager or advisor);
10
e) bankers' acceptances issued by any depository 0
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; and
g) any other investment permitted by each of the Rating
Agencies as set forth in writing delivered to the Indenture Trustee.
Fitch shall be considered to be a "Rating Agency" for the purpose of assessing
the eligibility hereunder of any investment pursuant to clause (b), (c), (d),
(e), and (f) only if Fitch is providing a rating which can be used, pursuant
to the terms of the applicable clause, to assess such investment.
"Eligible Lender Trust Agreement" means the Trust Agreement
between the Eligible Lender Trustee and the Depositor under which the Eligible
Lender Trustee holds legal title to FFELP Loans of which the Depositor is the
beneficial owner and FFELP Student Loans of which the Trust is beneficial
owner and one or more Future Trusts may be the beneficial owners.
"Eligible Lender Trustee" means [ELIGIBLE LENDER TRUSTEE], a
national banking association, not in its individual capacity but solely as
Eligible Lender Trustee under the Eligible Lender Trust Agreement.
"Event of Default" has the meaning specified in Section 5.01
of the Indenture.
"Excess Spread" means, with respect to any Quarterly Payment
Date, the percentage equivalent of a fraction the numerator of which is the
product of (a) four and (b) the difference between (x) the Expected Interest
Collections for such Quarterly Payment Date and (y) the sum of (i) the
Servicing Fee for such Quarterly Payment Date and all prior unpaid Servicing
Fees, (ii) the Administration Fee for such Quarterly Payment Date and all
prior unpaid Administration Fees, and (iii) the Noteholders' Interest
Distribution Amount for such Quarterly Payment Date, and the denominator of
which is the average of the amount of the Pool Balance as of the first and the
last day of the related Collection Period.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Exchanged Student Loan" means a Student Loan that (i) was
originated under the same loan program and is guaranteed by a Guarantor and
entitles the holder thereof to receive interest based on the same interest
rate index as the Serial Loan for which it is to be exchanged (the "Exchanged
Serial Loan") and (ii) will not, at any level of such interest rate index,
have an interest rate that is greater than that of the Exchanged Serial Loan.
11
"Executive Officer" means, with respect to any corporation,
the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, any Executive Vice President, any Senior Vice President, any Vice
President, the Secretary or the Treasurer of such corporation; and with
respect to any partnership, any general partner thereof.
"Expected Interest Collections" means, with respect to any
Quarterly Interest Period, the sum of (i) the amount of interest accrued, net
of accrued Monthly Rebate Fees and other amounts required by the Higher
Education Act to be paid to the Department, with respect to the FFELP Student
Loans for the related Student Loan Rate Accrual Period (whether or not such
interest is actually paid), (ii) all Interest Subsidy Payments and Special
Allowance Payments estimated to have accrued for such Student Loan Rate
Accrual Period whether or not actually received (taking into account any
expected deduction therefrom of Federal Origination Fees) and (iii) Investment
Earnings for such Student Loan Rate Accrual Period.
"Expenses" means any and all liabilities, obligations,
losses, damages, taxes, claims, actions and suits, and any and all reasonable
costs, expenses and disbursements (including reasonable legal fees and
expenses) of any kind and nature whatsoever which may at any time be imposed
on, incurred by, or asserted against the Trustee, the Eligible Lender Trustee
or any of either's officers, directors or agents in any way relating to or
arising out of the Trust Agreement, the Eligible Lender Trust Agreement, the
other Basic Documents, the Trust Estate, the administration of the Trust
Estate or the action or inaction of the Trustee or the Eligible Lender Trustee
under the Trust Agreement, the Eligible Lender Trust Agreement or the other
Basic Documents.
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Guarantor" means a state or private non-profit
guarantor that guarantees the payment of principal of and interest on any of
the FFELP Student Loans, which agency is reinsured by the Department under the
Higher Education Act for between 80% and 100% of the amount of default claims
paid by such Federal Guarantor for a given federal fiscal year for loans
disbursed prior to October 1, 1993, for 78% to 98% of default claims paid for
loans disbursed on or after October 1, 1993 and for 100% of death, disability,
bankruptcy, closed school and false certification claims paid.
"Federal Origination Fee" means, with respect to each
Consolidation Loan that is originated by the Eligible Lender Trustee on behalf
of the Issuer and each Add-on Consolidation Loan that is added to the
principal balance of a Consolidation Loan, the origination fee payable to the
Department equal to 0.5% of the initial principal balance of such
Consolidation Loan or Add-on Consolidation Loan.
"FFELP Loans" means loans that finance post-secondary
education and are the subject of guarantees by Federal Guarantors.
"FFELP Student Loans" means those Student Loans that are
FFELP Loans.
12
"Financed" means, with respect to Student Loans, that, as of
any date of determination, the loans have been conveyed to the Issuer,
consisting of the Initial Student Loans as of the Closing Date and,
thereafter, any Serial Loans or New Loans conveyed to the Issuer from the
Transferor, {any Consolidation Loans originated by the Trust as provided in
Section 6.07 of the Trust Agreement, any Consolidation Loans the principal
balance of which is increased by the principal balance of any related Add-on
Consolidation Loan as provided in Section 6.07 of the Trust Agreement and any
Qualified Substitute Student Loans conveyed to the Depositor as provided in
Section 3.02 of the Loan Sale Agreement.}
"Fitch" means Fitch Investors Service, L.P. or any successor
thereto.
"Forbearance Loan" means a Student Loan during a period of
forbearance of loan collections pursuant to the Higher Education Act.
"Grace" means the initial period following reduction by the
student Borrower to less than the minimum course load required by the Higher
Education Act, during which the student Borrower is not required to make
payments on the principal amount of the Borrower Note(s).
"Grace Loan" means a Student Loan during a period of Grace.
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and xxxxx x xxxx
upon and a security interest in and right of set-off against, deposit, set
over and confirm pursuant to the Indenture. A Grant of the Collateral or of
any other agreement or instrument shall include all rights, powers and options
(but none of the obligations) of the Granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Collateral and all other
moneys payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights
and options, to bring Proceedings in the name of the Granting party or
otherwise and generally to do and receive anything that the Granting party is
or may be entitled to do or receive thereunder or with respect thereto.
"Guarantee Agreement" means each agreement to guarantee
Student Loans entered into by the Eligible Lender Trustee, in the case of
FFELP Student Loans, on with a Guarantor.
"Guarantee Payment" means any payment made by a Guarantor
pursuant to a Guarantee Agreement in respect of a Student Loan.
"Guarantor" means the Initial Guarantors and any Additional
Guarantors.
"Higher Education Act" means the Higher Education Act of
1965, as amended, together with any rules, regulations and interpretations
thereunder.
13
["Incentive Student Loan" means a Student Loan which is
subject to an Incentive Program other than the Seller's Program.]
"[Incentive Interest Deposit" means, with respect to each
Monthly Collection Period and each Incentive Student Loan, the difference, if
any, between the amount of interest or other amounts which would have been
payable with respect to such Incentive Student Loan during such Monthly
Collection Period had no Incentive Program been in effect with respect to such
Incentive Student Loan and the amount of interest and other amounts which were
payable with respect to such Incentive Student Loan during such Monthly
Collection Period after giving effect to such Incentive Program.]
["Incentive Program" means any program terminable at will by
the Seller pursuant to which the Seller may choose to reduce the interest rate
or offer any other benefit on a Student Loan, and shall initially include the
Seller's [ ] Programs, as such program may be modified from time to time.]
"Indenture" means the Indenture dated as of [_________ __,
1999], between the Issuer and the Indenture Trustee.
"Indenture Trust Estate" means all money, instruments,
rights and other property that are subject or intended to be subject to the
lien and security interest of the Indenture for the benefit of the Noteholders
(including all property and interests Granted to the Indenture Trustee),
including all proceeds thereof.
"Indenture Trustee" means [INDENTURE TRUSTEE], a [New York]
banking corporation, not in its individual capacity but solely as Indenture
Trustee under the Indenture.
"Independent" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Seller, the Transferor and any Affiliate of any of
the foregoing Persons, (b) does not have any direct financial interest or any
material indirect financial interest in the Issuer, any such other obligor,
the Seller, the Transferor or any Affiliate of any of the foregoing Persons
and (c) is not connected with the Issuer, any such other obligor, the Seller,
the Transferor or any Affiliate of any of the foregoing Persons as an officer,
employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.
"Independent Certificate" means a certificate or opinion to
be delivered to the Indenture Trustee under the circumstances described in,
and otherwise complying with, the applicable requirements of Section 11.01 of
the Indenture, made by an Independent appraiser or other expert appointed by
an Issuer Order and approved by the Indenture Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that the signer
has read the definition of "Independent" in the Indenture and that the signer
is Independent within the meaning thereof.
"Initial Student Loans" means those Student Loans conveyed
to the Issuer on the Closing Date.
14
"Initial Guarantors" means [ ] and their respective
successors.
"Initial Pool Balance" means $[ ].
"In-School Loan" means a Student Loan during the period,
excluding periods of in-school Deferral, during which a student Borrower is
enrolled at an Educational Institution for at least the minimum course load
required to maintain such student Borrower's eligibility to borrow under the
education loan programs administered by the Guarantor.
"Insolvency Event" means, with respect to a specified
Person, (a) the filing of a decree or order for relief by a court having
jurisdiction in the premises in respect of such Person or any substantial part
of its property in an involuntary case under any applicable Federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect, or
appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator
or similar official for such Person or for any substantial part of its
property, or ordering the winding-up or liquidation of such Person's affairs,
and such decree or order shall remain unstayed and in effect for a period of
sixty consecutive days; or (b) the commencement by such Person of a voluntary
case under any applicable Federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by such Person to the
entry of an order for relief in an involuntary case under any such law, or the
consent by such Person to the appointment of or taking possession by a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or the
making by such Person of any general assignment for the benefit of creditors,
or the failure by such Person generally to pay its debts as such debts become
due, or the taking of action by such Person in furtherance of any of the
foregoing.
"Interest Subsidy Payments" means payments, designated as
such, consisting of interest subsidies by the Department in respect of the
FFELP Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Investment Earnings" means, with respect to any Monthly
Payment Date, the investment earnings (net of losses and investment expenses)
on amounts on deposit in the Trust Accounts to be deposited into the
Collection Account on or prior to such Monthly Payment Date pursuant to
Section 2(c)(v) of the Administration Agreement.
"Issuer" means [EFG Student Loan Trust 1999-A] until a
successor replaces it and, thereafter, means the successor and, for purposes
of any provision contained in the Indenture and required by the TIA, each
other obligor on the Notes.
"Issuer Order" and "Issuer Request" means a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.
"Lien" means a security interest, lien, charge, pledge,
equity or encumbrance of any kind, other than tax liens and any other liens,
if any, which attach to the respective Student Loan by operation of law as a
result of any act or omission by the related Obligor.
15
"Liquidated Student Loan" means any defaulted Student Loan
liquidated by the Servicer or which the Servicer has, after using all
reasonable efforts to realize upon the such Student Loan, determined to charge
off.
"Liquidation Proceeds" means, with respect to any Liquidated
Student Loan, the moneys collected in respect thereof from whatever source,
other than Recoveries, net of the sum of any amounts expended by the Servicer
in connection with such liquidation and any amounts required by law to be
remitted to the Borrower on such Liquidated Student Loan.
["Loan Purchase Amount" means with respect to a New Loan or
a Serial Loan to be purchased from the Seller by the Depositor, and by the
Issuer from the Depositor, an amount equal to the sum of (i) the Purchase
Collateral Balance and (ii) the Purchase Premium Amount; provided, however,
that after the Revolving Period, the Purchase Premium Amount payable in
respect of the purchase of a Serial Loan will be payable on the next
succeeding Quarterly Payment Date from Reserve Account Excess, if any, for
such Quarterly Payment Date; and provided, further, that if the Parity Date
occurs before the end of the Revolving Period, then, from the Parity Date to
the end of the Revolving Period, the Purchase Premium Amount payable in
respect of the purchase of a Serial Loan or a New Loan will be payable on the
next succeeding Quarterly Payment Date from Reserve Account Excess, if any,
for such Quarterly Payment Date that is available after all distributions from
such excess having a higher priority than payment of such Purchase Premium
Amounts have been made.]
"Loan Sale Agreement" means the Loan Sale Agreement dated as
of [ 1999], among the EFG Trustee, the Seller, EFG Funding and the Eligible
Lender Trustee.
"Lock-in Period" means the period of days preceding any
Quarterly Payment Date during which the T-Xxxx Rate in effect on the first day
of such period shall remain in effect until the end of the related Quarterly
Interest Period.
"Minimum Purchase Price" means as to any Quarterly Payment
Date, an amount equal to the greater of (i) the Purchase Amounts of the
Student Loans as of the end of the Collection Period immediately preceding
such Quarterly Payment Date or (ii) an amount that would be sufficient to (A)
reduce the outstanding principal amount of the Notes then outstanding on such
Quarterly Payment Date to zero and (B) pay to the Noteholders the Noteholders'
Interest Distribution Amount payable on such Quarterly Payment Date.
"Monthly Available Funds" means, with respect to each
Monthly Payment Date that is not a Quarterly Payment Date, the sum of the
following amounts with respect to the related Monthly Collection Period: (i)
all collections received by the Servicer on the Student Loans (including any
Guarantee Payments received with respect to the Student Loans); (ii) any
Interest Subsidy Payments and Special Allowance Payments received by the
Eligible Lender Trustee during such Monthly Collection Period with respect to
the FFELP Student Loans; (iii) all Liquidation Proceeds from any Student Loans
which became Liquidated Student Loans during such Monthly Collection Period in
accordance with the Servicer's customary servicing procedures, and all
recoveries in respect of Liquidated Student Loans which were written off in
prior Monthly Collection Periods; (iv) that portion of the amounts released
from the
16
Collateral Reinvestment Account with respect to Additional Fundings relating
to those interest costs on the Student Loans which are or will be capitalized
and any amounts transferred on a Determination Date from the Collateral
Reinvestment Account to the Collection Account pursuant to Section 2(f)(i)(E)
of the Administration Agreement; (v) the aggregate Purchase Amounts received
for those Student Loans repurchased by the Seller or purchased by the Servicer
under an obligation which arose during the related Monthly Collection Period;
(vi) Investment Earnings for such Monthly Payment Date and (vii) with respect
to each Monthly Payment Date other than a Quarterly Payment Date and other
than an Monthly Payment Date immediately succeeding a Quarterly Payment Date,
Monthly Available Funds remaining from the Monthly Collection Period relating
to the preceding Monthly Payment Date, after giving effect to the application
of such Monthly Available Funds on such preceding Monthly Payment Date;
provided, however, that if with respect to any Monthly Payment Date there
would not be sufficient funds, after applicatio of Monthly Available Funds (as
defined above) and amounts available from the Reserve Account, to pay any of
the items specified in Section 2(d)(iv) of the Administration Agreement, then
Monthly Available Funds for such Monthly Payment Date will include, in
addition to the Monthly Available Funds (as defined above), amounts on deposit
in the Collection Account on the Determination Date relating to such Monthly
Payment Date which would have constituted Monthly Available Funds for the
Monthly Payment Date succeeding such Monthly Payment Date up to the amount
necessary to pay such items, and the Monthly Available Funds for such
succeeding Monthly Payment Date will be adjusted accordingly; and provided,
further, that Monthly Available Funds will exclude (A) all payments and
proceeds (including Liquidation Proceeds) of any Financed Student Loans the
Purchase Amount of which has been included in Monthly Available Funds for a
prior Monthly Collection Period, (B) except as expressly included in clause
(iv) above amounts released from the Collateral Reinvestment Account, (C) any
Monthly Rebate Fees paid during the related Monthly Collection Period by or on
behalf of the Trust and (D) any collections in respect of principal on the
Financed Student Loans applied during the related Monthly Collection Period by
the Eligible Lender Trustee on behalf of the Trust prior to the end of the
Revolving Period to make deposits to the Collateral Reinvestment Account
pursuant to Section 2(d)(i) of the Administration Agreement and after the
Revolving Period, any expenditure of the Net Principal Cash Flow Amount used
to fund the addition of any Add-on Consolidation Loans, to purchase Serial
Loans or to fund the acquisition of Exchanged Serial Loans during such Monthly
Collection Period.
"Monthly Collection Period" means, with respect to any
Monthly Payment Date that is not a Quarterly Payment Date, the calendar month
immediately preceding the month of such Monthly Payment Date.
"Monthly Payment Date" means the twenty-seventh day of each
month (or, if any such date is not a Business Day, on the next succeeding
Business Day) commencing [ 1998].
"Monthly Rebate Fee" means, for each calendar month and with
respect to each Consolidation Loan that is originated by the Eligible Lender
Trustee on behalf of the Issuer, the fee payable to the Department equal to
the product of (x) one-twelfth, (y) 1.05% and (z)
17
the outstanding principal balance of such Consolidation Loan (including any
increases in the principal balance of a Consolidation Loan due to the addition
of the principal balance of a related Add-on Consolidation Loan) plus accrued
interest on such Consolidation Loan as of the last day of such month.
"Moody's" means Xxxxx'x Investors Service, Inc.
"Net Principal Cash Flow Amount" means, as of any date, the
Principal Cash Flow Amount (calculated for the Collection Period ending in the
preceding calendar month or, if no Collection Period ended in the preceding
calendar month, calculated for each preceding calendar month during the
current Collection Period) minus, after the Revolving Period, the Capitalized
Interest Amount for such Collection Period or for each such preceding calendar
month, as the case may be.
"New Loan" means a Student Loan which (i) is made by an
eligible lender under the Higher Education Act (in the case of a FFELP Student
Loan) to a Borrower who is not a Borrower under any Initial Student Loan, (ii)
is made under a loan program which existed as of the Closing Date, and (iii)
is guaranteed by a Guarantor.
"91-Day Treasury Bills" means direct obligations of the
United States with a maturity of thirteen weeks.
"Noteholder" means the Person in whose name a Note is
registered in the Note Register.
"Noteholders' Distribution Amount" means, with respect to
any Quarterly Payment Date, the sum of the Senior Noteholders' Distribution
Amount and the Subordinate Noteholders' Distribution Amount for such Quarterly
Payment Date.
"Noteholders' Interest Distribution Amount" means, with
respect to any Quarterly Payment Date, the sum of the Senior Noteholders'
Interest Distribution Amount and the Subordinate Noteholders' Interest
Distribution Amount.
"Noteholders' Interest T-Xxxx Carryover" means, collectively
with respect to each Quarterly Payment Date, the Senior Noteholders' Interest
T-Xxxx Carryover and the Subordinate Noteholders' Interest T-Xxxx Carryover.
"Note Owner" means, with respect to a Book-Entry Note, the
Person who is the owner of such Book-Entry Note, as reflected on the books of
the Clearing Agency, or on the books of a Person maintaining an account with
such Clearing Agency (directly as a Clearing Agency Participant or as an
indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Note Rate" means any one of the Senior Note Rate or the
Subordinate Note Rate.
18
"Note Register" and "Note Registrar" have the respective
meanings specified in Section 2.04 of the Indenture.
"Obligor" on a Student Loan means the borrower or
co-borrowers of such Student Loan and any other Person who owes payments in
respect of such Student Loan, including the Guarantor thereof and, with
respect to any Interest Subsidy Payment or Special Allowance Payment, if any,
thereon, the Department.
"Officers' Certificate" means (i) in the case of the Issuer,
a certificate signed by any two Authorized Officers of the Trustee, under the
circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.01 of the Indenture, and delivered to the Indenture
Trustee and (ii) in the case of the Seller, the Depositor, the Servicer, or
the Administrator, a certificate signed by any two Authorized Officers of the
Seller, the Depositor, the Servicer, or the Administrator, as appropriate.
"Opinion of Counsel" means (i) with respect to the Issuer,
one or more written opinions of counsel who may, except as otherwise expressly
provided in the Indenture, be employees of or counsel to the Issuer and who
shall be satisfactory to the Indenture Trustee, and which opinion or opinions
shall be addressed to the Indenture Trustee as Indenture Trustee, shall comply
with any applicable requirements of Section 11.01 of the Indenture, and shall
be in form and substance satisfactory to th Indenture Trustee and (ii) with
respect to the Seller, the Depositor, the Administrator, the Servicer or a
Guarantor, one or more written opinions of counsel who may be an employee of
or counsel to the Seller, the Depositor, the Administrator, the Servicer or
such Guarantor, which counsel shall be acceptable to the Indenture Trustee,
the Eligible Lender Trustee or the Rating Agencies, as applicable.
"Outstanding" means, as of the date of determination, all
Notes theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for
which money in the necessary amount has been theretofore deposited with
the Indenture Trustee or any Paying Agent in trust for the Noteholders
thereof (provided, however, that if such Notes are to be redeemed,
notice of such redemption has been duly given pursuant to the
Indenture); and
(iii) Notes in exchange for or in lieu of other
Notes which have been authenticated and delivered pursuant to the
Indenture unless proof satisfactory to the Indenture Trustee is
presented that any such Notes are held by a bona fide purchaser;
provided that in determining whether the Noteholders of the requisite
Outstanding Amount of the Notes have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any other Basic
Document, Notes owned by the Issuer, any other obligor upon the Notes, the
Seller or any Affiliate of any of the foregoing Persons shall be disregarded
19
and deemed not to be Outstanding, except that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes that a
Responsible Officer of the Indenture Trustee either actually knows to be so
owned or has received written notice thereof shall be so disregarded. Notes so
owned that have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Indenture Trustee the
pledgee's right so to act with respect to such Notes and that the pledgee is
not the Issuer, any other obligor upon the Notes, the Seller or any Affiliate
of any of the foregoing Persons.
"Outstanding Amount" means the aggregate principal amount of
all Notes Outstanding at the date of determination.
"Parity Date" means the first Quarterly Payment Date on
which the aggregate principal balance of the Notes, after giving effect to all
distributions on such date, is no longer in excess of the Pool Balance as of
the last day of the related Collection Period.
"Partnership Qualification Provisions" has the meaning
specified in Section 5.04 of the Trust Agreement.
"Paying Agent" means the Indenture Trustee or any other
Person that meets the eligibility standards for the Indenture Trustee
specified in Section 6.11 of the Indenture and is authorized by the Issuer to
make the payments to and distributions from the Collection Account and
payments of principal of and interest and any other amounts owing on the Notes
on behalf of the Issuer.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"Physical Property" has the meaning assigned to such term as
the definition of "Delivery" above.
"PLUS Loan" means a Student Loan designated as such that is
made under the Parent Loans to Undergraduate Students Program pursuant to the
Higher Education Act.
"Pool Balance" means, as of the close of business on the
last day of any Collection Period, the aggregate principal balance of the
Student Loans as of such day (including accrued interest thereon for the
immediately preceding Collection Period to the extent such interest will be
capitalized upon commencement of repayment, excluding any Purchased Student
Loans and Liquidated Student Loans).
"Predecessor Note" means, with respect to any particular
Note, every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition,
any Note authenticated and delivered under Section 2.05 of the Indenture and
in lieu of a mutilated, lost, destroyed or stolen Note shall be deemed to
evidence the same debt is the mutilated, lost, destroyed or stolen Note.
20
"Principal Cash Flow Amount" means, with respect to any
Quarterly Payment Date, the sum of the following amounts with respect to the
related Collection Period, or with respect to any other date of determination,
the sum of the following amounts with respect to the period specified: (i)
that portion of all collections received by the Servicer on the Student Loans
that is allocable to principal (including the portion of any Guarantee
Payments received that is allocable to principal of the Student Loans); (ii)
all Liquidation Proceeds attributable to the principal amount of Student Loans
which became Liquidated Student Loans during such Collection Period, or such
other specified period, in accordance with the Servicer's customary servicing
procedures, together with all Realized Losses on such Student Loans; (iii) to
the extent attributable to principal, the Purchase Amount received with
respect to each Student Loan repurchased by the Seller or purchased by the
Servicer as a result of a breach of a representation, warranty or covenant
which arose during the related Collection Period or such other specified
period; and (iv) the Principal Distribution Adjustment; provided, however,
that the Principal Distribution Amount will exclude all payments and proceeds
(including Liquidation Proceeds) of any Student Loans the Purchase Amount of
which has been included in Available Funds for a prior Collection Period and
during the Revolving Period will exclude the amount of collections in respect
of principal on the Student Loans during such Collection Period that were
deposited in the Collateral Reinvestment Account during such Collection
Period.
"Principal Distribution Adjustment" means, with respect to
any Quarterly Payment Date, the amount of Available Funds on such Quarterly
Payment Date to be used to make additional principal distributions to
Noteholders to account for (i) the amount of any insignificant balance
remaining outstanding as of such Quarterly Payment Date on a Student Loan
after receipt of a final payment from a Borrower or a Guarantor, when such
insignificant balances are waived in the ordinary course of busines by the
Servicer at the direction of the Administrator in accordance with the
Servicing Agreement or (ii) the amount of principal collections erroneously
treated as interest collections including, without limitation, by reason of
the failure by a borrower to capitalized interest that had been expected to be
capitalized; provided, however, that the Principal Distribution Adjustment for
any Quarterly Payment Date shall not exceed the lesser of (x) $100,000 and (y)
the Reserve Account Excess after giving effect to all distributions to be made
on such Quarterly Payment Date other than distributions to the Company out of
such excess.
"Principal Distribution Amount" means, with respect to any
Quarterly Payment Date occurring after the Revolving Period, the Net Principal
Cash Flow Amount for such Quarterly Payment Date minus the sum of (i) {any
funds remitted to the Seller during the preceding Collection Period for the
Purchase Collateral Balance of Serial Loans and (ii) any funds which are
applied during the preceding Collection Period to fund the addition of the
principal balance of any Add-on Consolidation Loan to the principal balance of
a related Consolidation Loan.}
"Private Guarantor" a guarantor as to principal and/or
interest on post-secondary education loans that are not FFELP Loans.
21
"Private Student Loan" means a Student Loan that is
guaranteed by a Private Guarantor and is not a FFELP Student Loan.
"Proceeding" means any suit in equity, action at law or
other judicial or administrative proceeding.
"Purchase Amount" means, with respect to a Student Loan
other than a Serial Loan to be purchased from the Issuer, the amount required,
as of the close of business on the last day of an Interest Period to prepay in
full the respective Student Loan under the terms thereof including all accrued
borrower interest thereon; provided, however, that the Purchase Amount for a
Student Loan, which is being repurchased by the Seller as a result of a breach
of the representation and warranty provided for in the last sentence of the
first paragraph of Exhibit C to the Loan Sale Agreement, will be calculated
without regard to any amount which the Seller has advanced with respect to
such loan and which was not reflected by the principal balance of such loan as
of the Cutoff Date (or the applicable Subsequent Cutoff Date, as the case may
be) after the Loan has been sold into the Trust.
"Purchase Collateral Balance" means with respect to a New
Loan or a Serial Loan to be purchased by the Issuer, an amount equal, as of
the related Subsequent Cut-off Date, to the principal balance of such loan
plus accrued borrower interest thereon if and to the extent that such interest
is not then payable and will, pursuant to the terms of such loan, be
capitalized and added to the principal balance of such loan.
"Purchase Premium Amount" means with respect to a New Loan
or a Serial Loan to be purchased by the Issuer, an additional amount to the
Purchase Collateral Balance not to exceed 2.5% of the principal balance owed
by the applicable borrower thereon.
"Purchased Student Loan" means a Student Loan purchased as
of the close of business on the last day of a Monthly Collection Period by the
Servicer pursuant to Section 3.05 of the Servicing Agreement or repurchased by
the Seller pursuant to Section 3.02 of the Loan Sale Agreement.
"Qualified Substitute Student Loan" means a Student Loan
that (i) was originated under the same loan program and is guaranteed by a
Guarantor and entitles the holder thereof to receive interest based on the
same interest rate index as the related Deleted Student Loan for which it is
to be substituted, and (ii) will not, at any level of such interest rate
index, have an interest rate that is less than that of such Deleted Student
Loan.
"Quarterly Payment Date" means the Monthly Payment Date
occurring in each [January, April, July and October, commencing with the
Monthly Payment Date occurring in ].
"Quarterly Interest Period" means, with respect to a
Quarterly Payment Date, the period from and including the Quarterly Payment
Date immediately preceding such Quarterly Payment Date (or in the case of the
first Quarterly Payment Date, the Closing Date) to but excluding the such
Quarterly Payment Date.
22
["Rating Agency" means each of Xxxxx'x, Fitch and S&P if and
for so long as it is the rating notes at the request of the Depositor. If no
such organization or successor is any longer in existence, "Rating Agency"
shall be a nationally recognized statistical rating organization or other
comparable Person designated by the Seller, notice of which designation shall
be given to the Indenture Trustee, the Trustee, the Eligible Lender Trustee
and the Servicer.]
"Rating Agency Condition" means, with respect to any action,
that each Rating Agency shall have been given 10 days' prior notice thereof
and that each of the Rating Agencies shall have notified the Depositor, the
Servicer, the Trustee and the Indenture Trustee in writing that such action
will not result in and of itself in a reduction or withdrawal of the then
current rating of the Senior Notes or the Subordinate Notes.
"Realized Losses" means the excess of the aggregate
principal balance of any Liquidated Student Loan plus accrued but unpaid
interest thereon over Liquidation Proceeds to the extent allocable to
principal.
"Record Date" means, with respect to any Quarterly Payment
Date or a Redemption Date, the close of business on the twenty-sixth day of
the calendar month in which such Quarterly Payment Date or Redemption Date
occurs (whether or not such date is a Business Day).
"Recoveries" means, with respect to any Liquidated Student
Loan, moneys collected in respect thereof, from whatever source, during any
Monthly Collection Period following the Monthly Collection Period in which
such Student Loan became a Liquidated Student Loan, 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 the Obligor.
"Redemption Date" means in the case of a payment to
Noteholders pursuant to Section 10.01 of the Indenture, the Quarterly Payment
Date specified by the Administrator or the Issuer pursuant to Section 10.01 of
the Indenture.
"Redemption Price" means in the case of a payment made to
Noteholders pursuant to Section 10.01 of the Indenture, the amount to be so
paid pursuant to such Section 10.01.
"Repayment" means the period of time during which a Borrower
is required to make installment payments to repay the aggregate principal
amount plus accrued interest of all amounts borrowed by virtue of the Borrower
Note(s) executed by such Borrower.
"Repayment Loan" means a Student Loan during a period of
Repayment.
"Reserve Account" means the account designated as such,
established and maintained pursuant to Section 2(c) of the Administration
Agreement.
23
"Reserve Account Excess" has the meaning specified in
Section 2(e)(ii) of the Administration Agreement.
"Reserve Account Initial Deposit" means $[ ].
"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.
"Revolving Period" means the period from the Closing Date
until the first to occur of (i) an Early Amortization Event or (ii) the last
day of the Collection Period preceding the [ ] Quarterly Payment Date.
"Schedule of Student Loans" means the listing of the Student
Loans set forth in Schedule A to the Loan Sale Agreement and to the Indenture
(which Schedule may be in the form of microfiche) as the same may be amended
from time to time.
"Secretary" means the Secretary of the Department, or any
predecessor or successor to the functions thereof under the Higher Education
Act.
"Seller" means EFG in its capacity as seller under the Loan
Sale Agreement.
"Senior Note" means a Floating Rate Asset Backed Senior Note
issued pursuant to the Indenture, substantially in the form of Exhibit A-1
thereto.
"Senior Note Final Maturity Date" means the [ ]
Quarterly Payment Date.
"Senior Noteholders' Distribution Amount" means, with
respect to any Quarterly Payment Date, the sum of the Senior Noteholders'
Interest Distribution Amount and the Senior Noteholders' Principal
Distribution Amount for such Quarterly Payment Date.
"Senior Noteholders' Interest Carryover Shortfall" means,
with respect to any Quarterly Payment Date, the excess of (i) the Senior
Noteholders' Interest Distribution Amount on the preceding Quarterly Payment
Date over (ii) the amount of interest actually distributed to the Senior
Noteholders on such preceding Quarterly Payment Date, plus interest on the
amount of such excess, to the extent permitted by law, at the interest rate
borne by the Senior Notes from such preceding Quarterly Payment Date to the
current Quarterly Payment Date.
"Senior Noteholders' Interest Distribution Amount" means,
with respect to any Quarterly Payment Date, the sum of (i) the amount of
interest accrued at the Senior Note Rate
24
for the related Quarterly Interest Period on the outstanding principal balance
of the Senior Notes on the immediately preceding Quarterly Payment Date after
giving effect to all principal distributions to holders of Senior Notes on
such date (or, in the case of the first Quarterly Payment Date, on the Closing
Date) and (ii) the Senior Noteholders' Interest Carryover Shortfall for such
Quarterly Payment Date; provided, however, that the Senior Noteholders'
Interest Distribution Amount will not include any Senior Noteholders' Interest
T-Xxxx Carryover.
"Senior Noteholders' Interest T-Xxxx Carryover" means, with
respect to each Quarterly Payment Date commencing in [ ], the amount equal to
the excess, if any, of (a) the amount of interest on the Senior Notes that
would have accrued in respect of the related Quarterly Interest Period had
interest been calculated based on the Senior Note T-Xxxx Rate over (b) the
amount of interest on the Senior Notes actually accrued in respect of such
Quarterly Interest Period based on the Student Loan Rate for such Quarterly
Interest Period, together with the unpaid portion of any such excess from
prior Quarterly Payment Dates (and interest accrued thereon, to the extent
permitted by law, at the Senior Note Rate calculated based on the Senior Note
T-Xxxx Rate); provided, however, that, on the Senior Note Final Maturity Date,
the Senior Noteholders' Interest T-Xxxx Carryover will be equal to the lesser
of (i) the Senior Noteholders' Interest T-Xxxx Carryover on such date
determined as described above and (ii) the amount of funds, if any, required
and available to be distributed to the Senior Noteholders on such date
pursuant to Sections 2(e)(ii)(b)(iii) and 2(e)(iii) of the Administration
Agreement and Section 8.02 of the Indenture.
"Senior Noteholders' Principal Carryover Shortfall" means,
as of the close of any Quarterly Payment Date, the excess of (i) the Senior
Noteholders' Principal Distribution Amount on such Quarterly Payment Date over
(ii) the amount of principal actually distributed to the Senior Noteholders on
such Quarterly Payment Date.
"Senior Noteholders' Principal Distribution Amount" means,
with respect to any Quarterly Payment Date (if the Revolving Period has
terminated on or prior to the end of the related Collection Period with
respect to such Quarterly Payment Date), the Principal Distribution Amount for
such Quarterly Payment Date plus the Senior Noteholders' Principal Carryover
Shortfall as of the close of the preceding Quarterly Payment Date; provided,
however, that the Senior Noteholders' Principal Distribution Amount will not
exceed the outstanding aggregate principal balance of the Senior Notes. In
addition, on the Senior Note Final Maturity Date, the principal required to be
distributed to Senior Noteholders will include the amount required to reduce
the outstanding principal balance of the Senior Notes to zero.
"Senior Note Pool Factor" as of the close of business on a
Quarterly Payment Date means a seven-digit decimal figure equal to the
outstanding principal balance of the Senior Notes divided by the original
outstanding principal balance of the Senior Notes. The Senior Note Pool Factor
will be [1.0000000] as of the Closing Date; thereafter, the Senior Note Pool
Factor will decline to reflect reductions in the outstanding principal balance
of the Senior Notes.
25
"Senior Note Rate" means, with respect to any Quarterly
Payment Date and the related Quarterly Interest Period, the interest rate per
annum (computed on the basis of the actual number of days in such Quarterly
Interest Period over a year of 365 days (366 in the case of a leap year))
equal to the lesser of (i) the Senior Note T-Xxxx Rate for such Quarterly
Interest Period and (ii) the Student Loan Rate for such Quarterly Interest
Period; provided, that, notwithstanding the foregoing, the Senior Note Rate
for the first Quarterly Interest Period shall be equal to the Senior Note
T-Xxxx Rate for such Quarterly Interest Period.
"Senior Note T-Xxxx Rate" means the weighted average of the
T-Xxxx Rates within the applicable Quarterly Interest Period plus 0.60%.
"Serial Loan" means a Student Loan which (i) is made by an
eligible lender under the Higher Education Act to a Borrower who is also a
Borrower under at least one outstanding Initial Student Loan and is acquired
by the Seller, (ii) is made under the same federal loan program as such
Initial Financed Student Loan and (iii) has the same Guarantor as such Initial
Student Loan.
"Servicer" means EFG Technologies, Inc. in its capacity as
servicer of the Student Loans or any permitted Successor Servicer or Successor
Servicers.
"Servicer Default" means an event specified in Section 6.01
of the Servicing Agreement.
"Servicer Liability Limit" has the meaning specified in
Section 3.05(a) of the Servicing Agreement.
"Servicer Liability Period" has the meaning specified in
Section 3.05(a) of the Servicing Agreement.
"Servicing Agreement" means the Servicing Agreement dated as
of [ 1998], among the Issuer, the Servicer, the and the Eligible Lender
Trustee.
"Servicing Fee" has the meaning specified in Section 3.06 of
the Servicing Agreement.
"Servicing Fee Shortfall" has the meaning specified in
Section 3.06 of the Servicing Agreement.
"SLS Loan" means a Student Loan designated as such that is
made under the Supplemental Loans for Students Program pursuant to the Higher
Education Act.
"S&P" means Standard & Poor's Corporation.
"Special Allowance Payments" means payments, designated as
such, consisting of effective interest subsidies by the Department in respect
of the Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
26
"Specified Reserve Account Balance" with respect to any
Quarterly Payment Date means the greater of: (a) 0.40% of the principal
balance of the Notes after taking into account the effect of distributions on
such Quarterly Payment Date and (b) $1,361,108; provided, however, that in no
event shall the Specified Reserve Account Balance exceed the sum of the
outstanding principal balance of the Notes.
"Xxxxxxxx Loan" means a Student Loan designated as such that
is made under the Xxxxxx X. Xxxxxxxx Student Loan Program in accordance with
the Higher Education Act.
"State" means any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx
xx Xxxxxxx, the trust territories of the United States, or the District of
Columbia.
"Student Loan" means an agreement to repay a disbursement of
money to or on behalf of an eligible student, evidenced by a Borrower Note and
guaranteed in accordance with the policies and procedures of the Guarantor
that is Financed.
"Student Loan Files" means the documents relating to the
Financed Student Loans specified in Section 2.01 of the Servicing Agreement.
"Student Loan Rate" means, with respect to any Quarterly
Interest Period, the interest rate equal to the product of (a) the quotient
obtained by dividing (i) 365 (366 in the case of a leap year) by (ii) the
actual number of days elapsed in such Quarterly Interest Period and (b) the
percentage equivalent of a fraction, the numerator of which is equal to
Expected Interest Collections for the related Quarterly Interest Period less
the Servicing Fee and the Administration Fee with respect to such Quarterly
Interest Period and (ii) the denominator of which is the aggregate principal
balance of the Notes as of the last day of such Quarterly Interest Period.
"Student Loan Rate Accrual Period" means, with respect to
any Quarterly Interest Period, the related Collection Period.
"Subordinate Note" means a Subordinate Floating Rate Asset
Backed Note issued pursuant to the Indenture, substantially in the form of
Exhibit A-2 thereto.
"Subordinate Note Final Maturity Date" means the [ ]
Quarterly Payment Date.
"Subordinate Noteholders' Distribution Amount" means, with
respect to any Quarterly Payment Date, the Subordinate Noteholders' Interest
Distribution Amount for such Quarterly Payment Date plus with respect to any
Quarterly Payment Date on and after which the Senior Notes have been paid in
full, the Subordinate Noteholders' Principal Distribution Amount for such
Quarterly Payment Date.
"Subordinate Noteholders' Interest Carryover Shortfall"
means, with respect to any Quarterly Payment Date, the excess of (i) the
Subordinate Noteholders' Interest Distribution Amount on the preceding
Quarterly Payment Date over (ii) the amount of interest
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actually distributed to the Subordinate Noteholders on such preceding
Quarterly Payment Date, plus interest on the amount of such excess, to the
extent permitted by law, at the rate borne by the Subordinate Notes from such
preceding Quarterly Payment Date to the current Quarterly Payment Date.
"Subordinate Noteholders' Interest Distribution Amount"
means, with respect to any Quarterly Payment Date, the sum of (i) the amount
of interest accrued at the Subordinate Note Rate for the related Quarterly
Interest Period on the outstanding principal balance of the Subordinate Notes
on the immediately preceding Quarterly Payment Date, after giving effect to
all principal distributions to Subordinate Noteholders on such Quarterly
Payment Date (or, in the case of the first Quarterly Payment Date, on the
Closing Date) and (ii) the Subordinate Noteholders' Interest Carryover
Shortfall for such Quarterly Payment Date; provided, however, that the
Subordinate Noteholders' Interest Distribution Amount will not include any
Subordinate Noteholders' Interest T-Xxxx Carryover.
"Subordinate Noteholders' Interest T-Xxxx Carryover" means,
with respect to each Quarterly Payment Date commencing in October 1997, the
amount equal to the excess, if any, of (a) the amount of interest on the
Subordinate Notes that would have accrued in respect of the related Quarterly
Interest Period had interest been calculated based on the Subordinate Note
T-Xxxx Rate over (b) the amount of interest on the Subordinate Notes actually
accrued in respect of such Quarterly Interest Period based on the Student Loan
Rate for such Quarterly Interest Period, together with the unpaid portion of
any such excess from prior Quarterly Payment Dates (and interest accrued
thereon, to the extent permitted by law, at the Subordinate Note Rate
calculated based on the Subordinate Note T-Xxxx Rate); provided, however,
that, on the Subordinate Note Final Maturity Date, the Subordinate
Noteholders' Interest T-Xxxx Carryover will be equal to the lesser of (i) the
Subordinate Noteholders' Interest T-Xxxx Carryover on such date determined as
described above and (ii) the amount of funds, if any, required and available
to be distributed to Subordinate Noteholders on such date pursuant to Sections
2(e)(ii)(b)(iii) and 2(e)(iii) of the Administration Agreement and Section
8.02 the Indenture.
"Subordinate Noteholders' Principal Carryover Shortfall"
means, as of the close of any Quarterly Payment Date on or after which the
Senior Notes have been paid in full, the excess of (i) the Subordinate
Noteholders' Principal Distribution Amount on such Quarterly Payment Date over
(ii) the amount of principal actually distributed to the Subordinate
Noteholders on such Quarterly Payment Date.
"Subordinate Noteholders' Principal Distribution Amount"
means, on each Quarterly Payment Date on and after which the aggregate
principal balance of the Senior Notes has been paid in full, the sum of (a)
the Principal Distribution Amount for such Quarterly Payment Date (or, in the
case of the Quarterly Payment Date on which the aggregate principal balance of
the Senior Notes is paid in full, any remaining Principal Distribution Amount
not otherwise distributed to Senior Noteholders on such Quarterly Payment
Date) and (b) the Subordinate Noteholders' Principal Carryover Shortfall as of
the close of the preceding Quarterly Payment Date; provided, however, that the
Subordinate Noteholders' Principal
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Distribution Amount will in no event exceed the outstanding principal balance
of the Subordinate Notes. In addition, on the Subordinate Note Final Maturity
Date, the principal required to be distributed to the Subordinate Noteholders
will include the amount required to reduce the outstanding principal balance
of the Subordinate Notes to zero.
"Subordinate Note Pool Factor" as of the close of business
on a Quarterly Payment Date means a seven-digit decimal figure equal to the
outstanding principal balance of the Subordinate Notes divided by the original
outstanding principal balance of the Subordinate Notes. The Subordinate Note
Pool Factor will be [1.0000000] as of the Closing Date; thereafter, the
Subordinate Note Pool Factor will decline to reflect reductions in the
outstanding principal balance of the Subordinate Notes.
"Subordinate Note Rate" means, with respect to any Quarterly
Payment Date and the related Quarterly Interest Period, the interest rate per
annum (computed on the basis of the actual number of days in such Quarterly
Interest Period over a year of 365 days (366 in the case of a leap year))
equal to the lesser of (i) the Subordinate Note T-Xxxx Rate for such Quarterly
Interest Period and (ii) the Student Loan Rate for such Quarterly Interest
Period; provided, that, notwithstanding the foregoing, the Subordinate Note
Rate for the first Quarterly Interest Period shall be equal to the Subordinate
Note T-Xxxx Rate for such Quarterly Interest Period.
"Subordinate Note T-Xxxx Rate" means the weighted average of
the T-Xxxx Rates within the applicable Quarterly Interest Period plus [ ]%.
"Subsequent Cutoff Date" means the date as of which any New
Loan or Serial Loan is transferred to the Issuer and the date on and after
which all distributions on such loan are property of the Issuer or the date of
the related Assignment in the case of any Qualified Substitute Student Loan.
"Subsequent Transfer Agreement" has the meaning provided in
Section 2.03 of Transfer Agreement.
"Substitution Adjustment Amount" has the meaning specified
in Section 3.02 of the Loan Sale Agreement.
"Successor Servicer" has the meaning specified in Section
3.07(e) of the Indenture.
"Tax Characterization Amendment" has the meaning specified
in Section 5.04 of the Trust Agreement.
"T-Xxxx Rate" means, on any day, the weighted average per
annum discount rate (expressed on a bond equivalent basis and applied on a
daily basis) for 91-day Treasury Bills sold at the most recent 91-day Treasury
Xxxx auction prior to such date as reported by the U.S. Treasury Department.
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 such auction is held
in a
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particular week, then the "T-Xxxx Rate" i effect as a result of the last such
publication or report shall remain in effect until such time, if any, as the
results of auctions of 91-day Treasury shall again be so published or reported
or such auction is held, as the case may be. The T-Xxxx Rate shall be subject
to a Lock-In Period of six Business Days.
"Transfer" means any direct or indirect transfer, sale,
pledge, hypothecation or other form of assignment of any ownership interest in
a Note or, with respect Section 3.01 of the Trust Agreement, in the Trust.
"Transfer Agreement" means the Transfer Agreement dated as
of ______ __, 1999, among the Issuer, the Transferor and the Eligible Lender
Trustee.
["Transfer Date" means the day fixed for the transfer of any
New Loans or Serial Loans by the Seller to the Issuer; provided that no
Transfer Date shall occur during the period from a Determination Date to the
end of the calendar month in which such Determination Date occurs.]
"Transferor" means EFG Funding.
"Treasury Regulations" means regulations, including proposed
or temporary regulations, promulgated under the Code. References in any
document or instrument to specific provisions of proposed or temporary
regulations shall include analogous provisions of final Treasury Regulations
or other successor Treasury Regulations.
"Trust" means the Issuer, established pursuant to the Trust
Agreement.
"Trust Account Property" means the Trust Accounts, all
amounts and investments held from time to time in any Trust Account (whether
in the form of deposit accounts, Physical Property, book-entry securities,
uncertificated securities or otherwise), including the Reserve Account Initial
Deposit and all proceeds of the foregoing.
"Trust Accounts" has the meaning specified in Section 2(c)
of the Administration Agreement.
"Trust Agreement" means the Trust Agreement dated as of
[ 1999], among the Depositor, the Trustee and the Eligible Lender Trustee.
"Trust Estate" means all right, title and interest of the
Trust (or the Eligible Lender Trustee on behalf of the Trust) in and to the
property and rights assigned to the Trust pursuant to Article II of the
Transfer 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 Trustee and the Trust pursuant to the Loan Sale Agreement and
the Administration Agreement.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force on the date hereof, unless otherwise specifically
provided.
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"UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction, as amended
from time to time.
"United States Person" means a citizen or resident of the
United States, a corporation, partnership or other entity created or organized
in, or under the laws of, the United States or any political subdivision
thereof, or an estate whose income is subject to United States federal income
tax regardless of its source, or a trust if a court within the United States
is able to exercise primary supervision over the administration of the trust
and one or more United States fiduciaries have the authority to control all
substantial decisions of the trust.
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