EXHIBIT 4.3
================================================================================
INDENTURE
among
SLM STUDENT LOAN TRUST 2003-12
as the Issuer,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as the Eligible Lender Trustee
and
THE BANK OF NEW YORK,
not in its individual capacity but
solely as the Indenture Trustee
Dated as of November 1, 2003
================================================================================
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS AND USAGE
Section 1.1 Definitions and Usage....................................................... 2
Section 1.2 Incorporation by Reference of Trust Indenture Act........................... 2
ARTICLE II
THE NOTES
Section 2.1 Form........................................................................ 3
Section 2.2 Execution, Authentication and Delivery...................................... 4
Section 2.3 Temporary Notes............................................................. 5
Section 2.4 Registration; Registration of Transfer and Exchange......................... 5
Section 2.5 Mutilated, Destroyed, Lost or Stolen Notes.................................. 7
Section 2.6 Persons Deemed Owner........................................................ 7
Section 2.7 Payment of Principal and Interest; Note Interest Shortfall.................. 8
Section 2.8 Cancellation................................................................ 9
Section 2.9 Release of Collateral....................................................... 9
Section 2.10 Book-Entry Notes............................................................ 9
Section 2.11 Notices to Clearing Agency.................................................. 10
Section 2.12 Definitive Notes............................................................ 10
Section 2.13 Transfer Restrictions....................................................... 11
ARTICLE III
COVENANTS
Section 3.1 Payment to Noteholders and each Swap Counterparty........................... 11
Section 3.2 Maintenance of Office or Agency............................................. 11
Section 3.3 Money for Payments to be Held in Trust...................................... 12
Section 3.4 Existence................................................................... 13
Section 3.5 Protection of Indenture Trust Estate........................................ 13
Section 3.6 Opinions as to Indenture Trust Estate....................................... 14
Section 3.7 Performance of Obligations; Servicing of Trust Student Loans................ 14
Section 3.8 Negative Covenants.......................................................... 17
Section 3.9 Annual Statement as to Compliance........................................... 17
Section 3.10 Issuer May Consolidate, etc................................................. 18
Section 3.11 Successor or Transferee..................................................... 19
Section 3.12 No Other Business........................................................... 19
-i-
Section 3.13 No Borrowing................................................................ 20
Section 3.14 Obligations of Servicer and Administrator................................... 20
Section 3.15 Guarantees, Loans, Advances and Other Liabilities........................... 20
Section 3.16 Capital Expenditures........................................................ 20
Section 3.17 Restricted Payments......................................................... 20
Section 3.18 Notice of Events of Default................................................. 20
Section 3.19 Further Instruments and Acts................................................ 21
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1 Satisfaction and Discharge of Indenture..................................... 21
Section 4.2 Application of Trust Money.................................................. 22
Section 4.3 Repayment of Moneys Held by Paying Agent.................................... 22
Section 4.4 Auction of Trust Student Loans.............................................. 22
ARTICLE V
REMEDIES
Section 5.1 Events of Default........................................................... 23
Section 5.2 Acceleration of Maturity; Rescission and Annulment.......................... 24
Section 5.3 Collection of Indebtedness and Suits for Enforcement by Indenture Trustee... 25
Section 5.4 Remedies; Priorities........................................................ 27
Section 5.5 Optional Preservation of the Trust Student Loans............................ 30
Section 5.6 Limitation of Suits......................................................... 30
Section 5.7 Unconditional Rights of Noteholders to Receive Principal and Interest....... 31
Section 5.8 Restoration of Rights and Remedies.......................................... 31
Section 5.9 Rights and Remedies Cumulative.............................................. 31
Section 5.10 Delay or Omission Not a Waiver.............................................. 31
Section 5.11 Control by Noteholders...................................................... 32
Section 5.12 Waiver of Past Defaults..................................................... 32
Section 5.13 Undertaking for Costs....................................................... 32
Section 5.14 Waiver of Stay or Extension Laws............................................ 33
Section 5.15 Action on Notes............................................................. 33
Section 5.16 Performance and Enforcement of Certain Obligations.......................... 33
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.1 Duties of Indenture Trustee................................................. 34
Section 6.2 Rights of Indenture Trustee................................................. 35
Section 6.3 Individual Rights of Indenture Trustee...................................... 36
-ii-
Section 6.4 Indenture Trustee's Disclaimer.............................................. 36
Section 6.5 Notice of Defaults.......................................................... 36
Section 6.6 Reports by Indenture Trustee to Noteholders................................. 36
Section 6.7 Compensation and Indemnity.................................................. 36
Section 6.8 Replacement of Indenture Trustee............................................ 37
Section 6.9 Successor Indenture Trustee by Merger....................................... 38
Section 6.10 Appointment of Co-Trustee or Separate Trustee............................... 38
Section 6.11 Eligibility; Disqualification............................................... 39
Section 6.12 Preferential Collection of Claims Against the Issuer........................ 40
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.1 Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders...... 40
Section 7.2 Preservation of Information; Communications to Noteholders.................. 40
Section 7.3 Reports by Issuer........................................................... 41
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.1 Collection of Money......................................................... 41
Section 8.2 Trust Accounts.............................................................. 42
Section 8.3 General Provisions Regarding Accounts....................................... 42
Section 8.4 Release of Indenture Trust Estate........................................... 43
Section 8.5 Opinion of Counsel.......................................................... 43
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1 Supplemental Indentures Without Consent of Noteholders...................... 44
Section 9.2 Supplemental Indentures with Consent of Noteholders......................... 45
Section 9.3 Execution of Supplemental Indentures........................................ 46
Section 9.4 Effect of Supplemental Indenture............................................ 46
Section 9.5 Conformity with Trust Indenture Act......................................... 46
Section 9.6 Reference in Notes to Supplemental Indentures............................... 47
ARTICLE X
REDEMPTION OF NOTES
Section 10.1 Redemption.................................................................. 47
Section 10.2 Form of Redemption Notice................................................... 47
-iii-
Section 10.3 Notes Payable on Redemption Date............................................ 48
ARTICLE XI
MISCELLANEOUS
Section 11.1 Compliance Certificates and Opinions, etc................................... 48
Section 11.2 Form of Documents Delivered to Indenture Trustee............................ 50
Section 11.3 Acts of Noteholders......................................................... 50
Section 11.4 Notices, etc................................................................ 51
Section 11.5 Notices to Noteholders; Waiver.............................................. 52
Section 11.6 Alternate Payment and Notice Provisions..................................... 52
Section 11.7 Conflict with Trust Indenture Act........................................... 52
Section 11.8 Effect of Headings and Table of Contents.................................... 53
Section 11.9 Successors and Assigns...................................................... 53
Section 11.10 Separability................................................................ 53
Section 11.11 Benefits of Indenture....................................................... 53
Section 11.12 Legal Holidays.............................................................. 53
Section 11.13 GOVERNING LAW............................................................... 53
Section 11.14 Counterparts................................................................ 53
Section 11.15 Recording of Indenture...................................................... 54
Section 11.16 Trust Obligations........................................................... 54
Section 11.17 No Petition................................................................. 54
Section 11.18 Inspection.................................................................. 54
Section 11.19 Subordination............................................................... 55
-iv-
APPENDICES, SCHEDULES AND EXHIBITS
APPENDIX A-1 Definitions and Usage
APPENDIX A-2 Reset Rate Note Procedures
APPENDIX A-3 Transfer Restrictions for the Reset Rate Notes
APPENDIX A-4 Transfer Restrictions for the Class A-5 Notes
SCHEDULE A Schedule of Trust Student Loans
SCHEDULE B Location of Trust Student Loan Files
EXHIBIT A Forms of Notes
EXHIBIT B Form of Note Depository Agreement for U.S. Dollar Denominated Notes
EXHIBIT C Form of Note Depository Agreement for Notes Denominated in a
Currency Other than U.S. Dollars
-v-
INDENTURE, dated as of November 1, 2003, among SLM STUDENT
LOAN TRUST 2003-12, a Delaware statutory trust (the "Issuer"), CHASE MANHATTAN
BANK USA, NATIONAL ASSOCIATION, a national banking association, not in its
individual capacity but solely as eligible lender trustee on behalf of the
Issuer (the "Eligible Lender Trustee"), and THE BANK OF NEW YORK, a New York
banking corporation, not in its individual capacity but solely as indenture
trustee (the "Indenture Trustee").
Each party agrees as follows for the benefit of the other
party and for the equal and ratable benefit of the holders of the Issuer's
Student Loan-Backed Notes (the "Notes") and, after the Notes have been paid in
full, for the benefit of any Cross-Currency Swap Counterparty:
GRANTING CLAUSE
The Issuer and, with respect to the Trust Student Loans, the
Eligible Lender Trustee hereby Grant to the Indenture Trustee, as trustee for
the benefit of the Noteholders and, subject to the provisions of Section 11.19,
each Cross-Currency Swap Counterparty, effective as of the Closing Date all of
their right, title and interest in and to the following:
(a) the Trust Student Loans, and all obligations of the
Obligors thereunder including all moneys accrued and paid thereunder on or after
the Cutoff Date and all guaranties and other rights relating to the Trust
Student Loans;
(b) the Servicing Agreement, including the right of the
Issuer to cause the Servicer to purchase Trust Student Loans from the Issuer
under circumstances described therein;
(c) the Sale Agreement, including the right of the Issuer
to cause the Depositor to repurchase Trust Student Loans from the Issuer under
circumstances described therein and including the rights of the Depositor under
the Purchase Agreement;
(d) the Purchase Agreement, to the extent that the rights
of the Depositor thereunder have been assigned to the Issuer pursuant to the
Sale Agreement, including the right of the Depositor to cause Xxxxxx Xxx to
repurchase Trust Student Loans from the Depositor under circumstances described
therein;
(e) the Administration Agreement, the Interest Rate Cap
Agreement, the Remarketing Agreement, the Initial Swap Agreements and any other
Swap Agreement to be entered into from time to time and any agreement
representing Eligible Repurchase Obligations between the Trust and an Eligible
Repo Counterparty to be entered into from time to time;
(f) each Guarantee Agreement, including the right of the
Issuer to cause the related Guarantor to make Guarantee Payments in respect of
the Trust Student Loans;
(g) the Trust Accounts and all funds on deposit from time
to time in the Trust Accounts, including the Reserve Account Initial Deposit and
the Capitalized Interest Account Initial Deposit, if any, and all investments
and proceeds thereof (including all income thereon); and
(h) all present and future claims, demands, causes and
choses in action in respect of any or all of the foregoing and all payments on
or under and all proceeds of every kind and nature whatsoever in respect of any
or all of the foregoing, including all proceeds of the conversion, voluntary or
involuntary, into cash or other liquid property, all cash proceeds, accounts,
accounts receivable, notes, drafts, acceptances, chattel paper, checks, general
intangibles, deposit accounts, insurance proceeds, condemnation awards, rights
to payment of any and every kind and other forms of obligations and receivables,
instruments and other property which at any time constitute all or part of or
are included in the proceeds of any of the foregoing (collectively, the
"Collateral").
The foregoing Grant is made in trust to secure the payment of
principal of and interest on, and any other amounts owing in respect of, the
Notes, equally and ratably without prejudice, priority or distinction, to secure
compliance with the provisions of this Indenture and to secure amounts owing to
any Cross-Currency Swap Counterparty under the related Cross-Currency Swap
Agreement subject to the provisions of Section 11.19, all as provided in this
Indenture.
The Indenture Trustee, as indenture trustee on behalf of the
Noteholders and each Cross-Currency Swap Counterparty, acknowledges such Grant,
accepts the trusts under this Indenture in accordance with the provisions of
this Indenture and agrees to perform its duties required in this Indenture to
the best of its ability to the end that the interests of the Noteholders and
each Cross-Currency Swap Counterparty under the related Cross-Currency Swap
Agreement may be adequately and effectively protected.
ARTICLE I
DEFINITIONS AND USAGE
Section 1.1 Definitions and Usage. Except as otherwise
specified herein or as the context may otherwise require, capitalized terms used
but not otherwise defined herein are defined in Appendix A-1 to this Indenture,
which also contains rules as to usage that shall be applicable herein.
Section 1.2 Incorporation by Reference of Trust Indenture Act.
Whenever this Indenture refers to a provision of the TIA, the provision is
incorporated by reference in and made a part of this Indenture. The following
TIA terms used in this Indenture have the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Notes.
"indenture security holder" means a Noteholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the
Indenture Trustee.
-2-
"obligor" on the indenture securities means the Issuer and any
other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by
the TIA, defined by TIA reference to another statute or defined by Commission
rule have the meaning assigned to them by such definitions.
ARTICLE II
THE NOTES
Section 2.1 Form. The Notes, together with the Indenture
Trustee's certificate of authentication, shall be in substantially the forms set
forth in Exhibit A, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture and may have
such letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing the Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.
The Definitive Notes shall be typewritten, printed,
lithographed or engraved or produced by any combination of these methods (with
or without steel engraved borders), all as determined by the officers executing
such Notes, as evidenced by their execution of such Notes.
The terms of the Notes set forth in Exhibit A are part of the
terms of this Indenture.
Each class of Floating Rate Notes will be represented by
interests in a book-entry note certificate deposited on the Closing Date with
The Bank of New York, as custodian for DTC (the "DTC Custodian"), and registered
in the name of Cede & Co. as initial nominee for DTC.
The Reset Rate Notes denominated in U.S. Dollars may be
offered and sold only to QIBs, and initially will be represented by interests in
a global registered note certificate (the "U.S. Rule 144A Global Note
Certificate"), deposited on the Closing Date with the DTC Custodian and
registered in the name of Cede & Co. as initial nominee for DTC. At all times,
the entire Outstanding Amount of the Reset Rate Notes then denominated in U.S.
Dollars will be allocated to the corresponding U.S. Rule 144A Global Note
Certificate. On the Closing Date, a corresponding Non-U.S. Rule 144A Global Note
Certificate (as defined below) and Regulation S Global Note Certificate (as
defined below) for the Reset Rate Notes will be deposited with the Regulation S
Custodian (as defined below), registered in the name of The Bank of New York
Depository (Nominees) Limited, as initial joint nominee for Euroclear and
Clearstream (the "Joint Nominee"), and each such global registered note
certificate will have an outstanding principal balance of zero for so long as
the Reset Rate Notes are denominated in U.S. Dollars.
The Reset Rate Notes denominated in a currency other than U.S.
Dollars (including the Reset Rate Notes during their initial Reset Period) may
be offered and sold only to
-3-
QIBs in reliance on Rule 144A or to a non-U.S. Person (as defined in Regulation
S) outside the United States of America in reliance on Regulation S, as
applicable, and will be represented by interests in either a Rule 144A global
registered note certificate (the "Non-U.S. Rule 144A Global Note Certificate")
or a Regulation S global registered note certificate (the "Regulation S Global
Note Certificate," and collectively with the Non-U.S. Rule 144A Global Note
Certificate, the "Non-U.S. Global Note Certificates"). Each Non-U.S. Global Note
Certificate will be registered in the name of the Joint Nominee, and will be
deposited on the Closing Date with The Bank of New York, acting through its
London branch, as common depositary for Euroclear and Clearstream (the
"Regulation S Custodian" and together with the DTC Custodian, the "Custodian").
At all times, there will be only one Non-U.S. Rule 144A Global Note Certificate
and one Regulation S Global Note Certificate for the Reset Rate Notes. At all
times, the entire Outstanding Amount of the Reset Rate Notes denominated in a
currency other than U.S. Dollars will be allocated between the corresponding
Non-U.S. Rule 144A Global Note Certificate and Regulation S Global Note
Certificate for the Reset Rate Notes. On the Closing Date, a corresponding U.S.
Rule 144A Global Note Certificate will be deposited with the DTC Custodian and
will have an outstanding principal balance of zero for so long as the Reset Rate
Notes are denominated in a currency other than U.S. Dollars.
Section 2.2 Execution, Authentication and Delivery. The Notes
shall be executed on behalf of the Issuer by any of its Authorized Officers. The
signature of any such Authorized Officer on the Notes may be manual or
facsimile.
Notes bearing the manual or facsimile signature of individuals
who were at any time Authorized Officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
The Indenture Trustee shall upon Issuer Order authenticate and
deliver Notes for original issue in an aggregate principal amount of
$2,531,393,600, using an exchange rate of $1.6884 = L1.00 with respect to the
principal amount of L396,500,000 of the Reset Rate Notes included in such
amount. The aggregate principal amount of Notes Outstanding at any time may not
exceed such amount except as provided in Section 2.5. On each Spread
Determination Date, upon receipt of an Issuer Order, the Indenture Trustee shall
deliver a revised Schedule A for the Reset Rate Notes to the Custodians.
Each Note shall be dated the date of its authentication. The
Floating Rate Class A Notes (other than the Class A-5 Notes) shall be issuable
as registered notes in minimum denominations of $1,000 and additional increments
of $1,000. The Class A-5 Notes shall be issuable as registered notes in minimum
denominations of $250,000 and additional increments of $1,000. The Class B Notes
shall be issuable as registered Class B Notes in minimum denominations of
$100,000 and additional increments of $1,000.
During any Reset Period when the Reset Rate Notes are
denominated in U.S. Dollars, they shall be issued in minimum denominations of
$250,000, and additional increments of $1. During any Reset Period when the
Reset Rate Notes are denominated in a currency other than U.S. Dollars, they
shall be issued in minimum denominations of the applicable currency equivalent
(approximately) of $250,000 and additional increments of the applicable currency
-4-
equivalent of $1 (which shall be determined by reference to the exchange rate
to be set forth in the related cross-currency swap agreement); provided, that
during any Reset Period when the Reset Rate Notes are denominated in Pounds
Sterling (including the initial Reset Period), the Reset Rate Notes shall be
issued in minimum denominations of L100,000 and additional increments of L1; and
provided, further, that during any Reset Period when the Reset Rate Notes are
denominated in Euros, the Reset Rate Notes shall be issued in minimum
denominations of E100,000 and additional increments of E1.
No Note shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose, unless there appears on such Note a
certificate of authentication substantially in the form provided for herein
executed by the Indenture Trustee by the manual signature of one of its
authorized signatories, and such certificate upon any Note shall be conclusive
evidence, and the only evidence, that such Note has been duly authenticated and
delivered hereunder.
Section 2.3 Temporary Notes. Pending the preparation of
Definitive Notes, the Issuer may execute, and upon receipt of an Issuer Order
the Indenture Trustee shall authenticate and deliver, temporary Notes which are
printed, lithographed, typewritten, mimeographed or otherwise produced, of the
tenor of the Definitive Notes in lieu of which they are issued and with such
variations not inconsistent with the terms of this Indenture determined to be
appropriate by the Responsible Officer of the Issuer executing the temporary
Notes, as evidenced by his or her execution of such temporary Notes.
If temporary Notes are issued, the Issuer will cause
Definitive Notes to be prepared without unreasonable delay. After the
preparation of Definitive Notes, the temporary Notes shall be exchangeable for
Definitive Notes upon surrender of the temporary Notes at the office or agency
of the Issuer to be maintained as provided in Section 3.2, without charge to the
Noteholder. Upon surrender for cancellation of any one or more temporary Notes,
the Issuer shall execute and the Indenture Trustee shall authenticate and
deliver in exchange therefor a like principal amount of Definitive Notes of
authorized denominations. Until so exchanged, the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as Definitive
Notes.
Section 2.4 Registration; Registration of Transfer and
Exchange. The Issuer shall cause to be kept a register (the "Note Register") in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and the registration of transfers of
Notes. The Indenture Trustee shall be "Note Registrar" for the purpose of
registering Notes and transfers of Notes as herein provided. Upon any
resignation of any Note Registrar, the Issuer shall promptly appoint a successor
or, if it elects not to make such an appointment, assume the duties of Note
Registrar.
If a Person other than the Indenture Trustee is appointed by
the Issuer as Note Registrar, the Issuer shall give the Indenture Trustee prompt
written notice of the appointment of such Note Registrar and of the location,
and any change in the location, of the Note Register, and the Indenture Trustee
shall have the right to inspect the Note Register at all reasonable times and to
obtain copies thereof, and the Indenture Trustee shall have the right to rely
upon a certificate
-5-
executed on behalf of the Note Registrar by an Executive Officer thereof as to
the names and addresses of the Noteholders and the principal amounts and number
of such Notes.
Upon surrender for registration of transfer of any Note at the
office or agency of the Issuer to be maintained as provided in Section 3.2 or,
with respect to the Reset Rate Notes, to the Note Registrar or any transfer
agent, as applicable, if the requirements of Section 8-401(1) of the UCC are
met, the Issuer shall execute, and the Indenture Trustee shall authenticate and
the Noteholder shall obtain from the Indenture Trustee, in the name of the
designated transferee or transferees, one or more new Notes in any authorized
denominations and a like aggregate principal amount.
On each Reset Date on which either the All Hold Rate is not
applicable or fewer than 100% of the Reset Rate Noteholders permissibly elect to
hold their Reset Rate Notes, the Indenture Trustee shall allocate the entire
Outstanding Amount of the Reset Rate Notes to either the U.S. Rule 144A Global
Note Certificate or the Non-U.S. Global Note Certificates, as appropriate. Any
transfer of Reset Rate Notes (other than on a Reset Date) between the related
U.S. Rule 144A Global Note Certificate and the related Non-U.S. Global Note
Certificates is not permitted and any attempt or inadvertent transfer shall be
null and void and of no effect.
At the option of the Noteholder, Notes may be exchanged for
other Notes in any authorized denominations and a like aggregate principal
amount, upon surrender of the Notes to be exchanged at such office or agency.
Whenever any Notes are so surrendered for exchange, the Issuer shall execute,
and the Indenture Trustee shall authenticate and the Noteholder shall obtain
from the Indenture Trustee, the Notes which the Noteholder making the exchange
is entitled to receive.
All Notes issued upon any registration of transfer or exchange
of Notes shall be the valid obligations of the Issuer, evidencing the same debt,
and entitled to the same benefits under this Indenture, as the Notes surrendered
upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of
transfer or exchange shall be duly endorsed by, or be accompanied by a written
instrument of transfer in form satisfactory to the Indenture Trustee duly
executed by the Noteholder thereof or such Noteholder's attorney duly authorized
in writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar, which requirements
include membership or participation in Securities Transfer Agent's Medallion
Program ("STAMP") or such other "signature guarantee program" as may be
determined by the Note Registrar in addition to, or in substitution for, STAMP,
all in accordance with the Exchange Act.
No service charge shall be made to a Noteholder for any
registration of transfer or exchange of Notes, but the Indenture Trustee may
require payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in connection with any registration of transfer or
exchange of Notes, other than exchanges pursuant to Section 2.3 or 9.6 not
involving any transfer.
The preceding provisions of this Section notwithstanding, the
Issuer shall not be required to make and the Note Registrar need not register
transfers or exchanges of Notes
-6-
selected for redemption or of any Note for a period of 15 days preceding the due
date for any payment with respect to the Note.
Section 2.5 Mutilated, Destroyed, Lost or Stolen Notes. If (i)
any mutilated Note is surrendered to the Indenture Trustee, or the Indenture
Trustee receives evidence to its satisfaction of the destruction, loss or theft
of any Note, and (ii) there is delivered to the Issuer and the Indenture Trustee
such security or indemnity as may be required by each of them to hold the Issuer
and the Indenture Trustee harmless, then, in the absence of notice to the
Issuer, the Note Registrar or the Indenture Trustee that such Note has been
acquired by a bona fide purchaser, and provided that the requirements of Section
8-405 of the UCC are met, the Issuer shall execute and upon its request the
Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Note, a replacement Note;
provided, however, that if any such destroyed, lost or stolen Note, but not a
mutilated Note, shall have become or within 15 days shall be due and payable, or
shall have been called for redemption, instead of issuing a replacement Note,
the Issuer may pay such destroyed, lost or stolen Note when so due or payable or
upon the Redemption Date without surrender thereof. If, after the delivery of
such replacement Note or payment of a destroyed, lost or stolen Note pursuant to
the proviso to the preceding sentence, a bona fide purchaser of the original
Note in lieu of which such replacement Note was issued presents for payment such
original Note, the Issuer and the Indenture Trustee shall be entitled to recover
such replacement Note (or such payment) from the Person to whom it was delivered
or any Person taking such replacement Note from such Person to whom such
replacement Note was delivered or any assignee of such Person, except a bona
fide purchaser, and shall be entitled to recover upon the security or indemnity
provided therefor to the extent of any loss, damage, cost or expense incurred by
the Issuer or the Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this Section,
the Issuer may require the payment by the Noteholder thereof of a sum sufficient
to cover any tax or other governmental charge that may be imposed in relation
thereto and any other reasonable expenses (including the fees and expenses of
the Indenture Trustee) connected therewith.
Every replacement Note issued pursuant to this Section in
replacement of any mutilated, destroyed, lost or stolen Note shall constitute an
original additional contractual obligation of the Issuer, whether or not the
mutilated, destroyed, lost or stolen Note shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Notes duly issued hereunder.
The provisions of this Section are exclusive and shall
preclude (to the extent lawful) all other rights and remedies with respect to
the replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 2.6 Persons Deemed Owner. Prior to due presentment for
registration of transfer of any Note, the Issuer, the Indenture Trustee and any
agent of the Issuer or the Indenture Trustee may treat the Person in whose name
any Note is registered (as of the day of determination) as the owner of such
Note for the purpose of receiving payments of principal of, interest, if any, on
such Note and for all other purposes whatsoever, whether or not such Note be
-7-
overdue, and neither the Issuer, the Indenture Trustee nor any agent of the
Issuer or the Indenture Trustee shall be affected by notice to the contrary.
Section 2.7 Payment of Principal and Interest; Note Interest
Shortfall. (a) The Floating Rate Notes shall accrue interest as provided in such
Floating Rate Notes, which shall be substantially in the form of Exhibits X-0,
X-0, X-0, X-0, X-0 and A-9 and the Reset Rate Notes shall accrue interest as
provided in such Reset Rate Notes, which shall be substantially in the form of
Exhibit X-0, X-0 or A-8, and such interest shall be payable on each applicable
Distribution Date as specified therein, subject to Section 3.1. Any installment
of interest or principal, if any, payable on any Note which is punctually paid
or duly provided for by the Issuer on the applicable Distribution Date shall be
paid to the Person in whose name such Note (or one or more Predecessor Notes) is
registered on the applicable Record Date by check mailed first-class, postage
prepaid to such Person's address as it appears on the Note Register on such
Record Date, except that, unless Definitive Notes have been issued pursuant to
Section 2.12, with respect to Notes registered on the Record Date in the name of
the nominee of the applicable Clearing Agency (initially, such nominee to be
Cede & Co.), as nominee for DTC, for the Floating Rate Notes and The Bank of New
York Depository (Nominees) Limited, as joint nominee for Euroclear and
Clearstream, for the Reset Rate Notes, payment shall be made by wire transfer in
immediately available funds to the account designated by such nominee and except
for the final installment of principal payable with respect to such Note on a
Distribution Date or on the Note Final Maturity Date for such Note which shall
be payable as provided below. The funds represented by any such checks returned
undelivered shall be held in accordance with Section 3.3.
(b) The principal of each class of Floating Rate Notes shall
be payable on each applicable Distribution Date as provided in the forms of
Notes set forth in Exhibits X-0, X-0, X-0, X-0, X-0 and A-9 and the principal of
the Reset Rate Notes shall be payable on each applicable Distribution Date as
set forth in Exhibit X-0, X-0 or A-8 and in Appendix A-2 to this Indenture.
Notwithstanding the foregoing, the entire unpaid principal amount of each class
of the Notes shall be due and payable, if not previously paid, on the Note Final
Maturity Date for such class of Notes and on the date on which an Event of
Default shall have occurred and be continuing if the Indenture Trustee or the
Noteholders of the Notes representing not less than a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2. All principal payments on the
Notes shall be made pro rata to the specific class of Noteholders entitled
thereto. The Indenture Trustee shall notify the Person in whose name a Note is
registered at the close of business on the Record Date preceding the
Distribution Date on which the Issuer expects that the final installment of
principal of and interest on such Note will be paid. Such notice shall be mailed
or transmitted by facsimile prior to such final Distribution Date and shall
specify that such final installment will be payable only upon presentation and
surrender of such Note and shall specify the place where such Note may be
presented and surrendered for payment of such installment. Notices in connection
with redemptions of Notes shall be mailed to Noteholders as provided in Section
10.2.
(c) If the Issuer defaults in a payment of interest at the
applicable Note Rate on the Notes, the Issuer shall pay the resulting Note
Interest Shortfall on the following Distribution Date as provided in the
Administration Agreement.
-8-
Section 2.8 Cancellation. All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee. The Issuer may at any
time deliver to the Indenture Trustee for cancellation any Notes previously
authenticated and delivered hereunder which the Issuer may have acquired in any
manner whatsoever and all Notes so delivered shall be promptly cancelled by the
Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for
any Notes cancelled as provided in this Section, except as expressly permitted
by this Indenture. All canceled Notes may be held or disposed of by the
Indenture Trustee in accordance with its standard retention or disposal policy
as in effect at the time, unless the Issuer shall direct by an Issuer Order that
they be returned to it and so long as such Issuer Order is timely and the Notes
have not been previously disposed of by the Indenture Trustee.
Section 2.9 Release of Collateral. Subject to Section 11.1 and
the terms of the Basic Documents, the Indenture Trustee shall release property
from the lien of this Indenture only upon receipt of an Issuer Request
accompanied by an Officers' Certificate of the Issuer, an Opinion of Counsel and
Independent Certificates in accordance with TIA Sections 314(c) and 314(d)(1) or
an Opinion of Counsel in lieu of such Independent Certificates to the effect
that the TIA does not require any such Independent Certificates.
Section 2.10 Book-Entry Notes. The Notes, upon original
issuance, will be issued in the form of typewritten Notes representing the
Book-Entry Notes, to be delivered to the applicable initial Clearing Agency by
the Issuer, or by the Indenture Trustee on behalf of the Issuer. Such Notes
shall initially be registered on the Note Register in the name of the nominee of
each initial Clearing Agency, and no Note Owner shall receive a definitive,
fully registered note (a "Definitive Note") representing such Note Owner's
interest in such Note, except as provided in Section 2.12. Unless and until
Definitive Notes have been issued to Note Owners pursuant to Section 2.12:
(i) the provisions of this Section shall be in full force
and effect;
(ii) the Note Registrar and the Indenture Trustee, and
their respective directors, officers, employees and agents, may deal
with the applicable Clearing Agency for all purposes (including the
payment of principal of and interest and other amounts on the Notes) as
the authorized representative of the Note Owners;
(iii) to the extent that the provisions of this Section
conflict with any other provisions of this Indenture, the provisions of
this Section shall control;
(iv) the rights of Note Owners shall be exercised only
through the applicable Clearing Agency and shall be limited to those
established by law and agreements between such Note Owners and the
applicable Clearing Agency and/or the applicable Clearing Agency
Participants pursuant to the Note Depository Agreements; and unless and
until Definitive Notes are issued pursuant to Section 2.12, the
applicable initial Clearing Agency will make book-entry transfers among
the applicable Clearing Agency Participants and receive and transmit
payments of principal of and interest and other amounts on the Notes to
such applicable Clearing Agency Participants;
-9-
(v) whenever this Indenture requires or permits actions
to be taken based upon instructions or directions of Noteholders of
Notes evidencing a specified percentage of the Outstanding Amount of
the Notes, the applicable Clearing Agency shall be deemed to represent
such percentage only to the extent that it has received instructions to
such effect from Note Owners and/or applicable Clearing Agency
Participants owning or representing, respectively, such required
percentage of the beneficial interest in the Notes and has delivered
such instructions to the Indenture Trustee; and
(vi) upon acquisition or transfer of a beneficial interest
in any Book-Entry Note by, for or with the assets of, an employee
benefit plan or other retirement arrangement ("Plan"), such Note Owner
shall be deemed to have represented that such acquisition or purchase
will not constitute or otherwise result in: (i) in the case of a Plan
subject to Section 406 of ERISA or Section 4975 of the Code, a
non-exempt prohibited transaction in violation of Section 406 of ERISA
or Section 4975 of the Code which is not covered by a class or other
applicable exemption and (ii) in the case of a Plan subject to a
substantially similar federal, state, local or foreign law ("Similar
Law"), a non-exempt violation of such substantially Similar Law. Any
transfer found to have been made in violation of such deemed
representation shall be null and void and of no effect.
Section 2.11 Notices to Clearing Agency. Whenever a notice or
other communication is required under this Indenture to be given to Noteholders,
unless and until Definitive Notes shall have been issued to Note Owners pursuant
to Section 2.12, the Indenture Trustee shall give all such notices and
communications specified herein to the applicable Clearing Agency.
Section 2.12 Definitive Notes. If (i) the Administrator
advises the Indenture Trustee in writing that a Clearing Agency (a) is closed
for business for a continuous period of 14 days (other than by reason of
holiday, statutory or otherwise), (b) announces an intention to cease business
permanently (or does so and no alternative clearing system acceptable to the
Indenture Trustee is then available), or (c) at any time, is unwilling or unable
to continue as, or ceases to be, a clearing agency registered under all
applicable laws, and a successor clearing agency which is registered as a
clearing agency under all applicable laws is not appointed by the Administrator
within 90 days of such event, (ii) the Administrator at its option advises the
Indenture Trustee in writing that it elects to terminate the book-entry system
through that Clearing Agency or (iii) after the occurrence of an Event of
Default, a Servicer Default or an Administrator Default, Note Owners
representing beneficial interests aggregating at least a majority of the
Outstanding Amount of the applicable Notes advise the applicable Clearing Agency
(which shall then notify the Indenture Trustee) in writing that the continuation
of a book-entry system through such Clearing Agency is no longer in the best
interests of such Note Owners, then the Indenture Trustee shall cause such
Clearing Agency to notify all Note Owners cleared, through such Clearing Agency,
of the occurrence of any such event and of the availability of Definitive Notes
to Note Owners requesting the same. Upon surrender to the Indenture Trustee of
the typewritten Notes representing the Book-Entry Notes by a Clearing Agency,
accompanied by registration instructions, the Issuer shall execute and the
Indenture Trustee shall authenticate the Definitive Notes in accordance with the
instructions of such Clearing Agency, which shall include, without limitation,
the identity and payment instructions for all Noteholders of the applicable
Notes. None of the Issuer, the Note Registrar or the
-10-
Indenture Trustee shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of Definitive Notes, the Indenture Trustee shall
recognize the holders of the Definitive Notes as Noteholders.
Upon acquisition or transfer of a Definitive Note by, for or
with the assets of, a Plan, such Note Owner shall be deemed to have represented
that such acquisition or purchase will not constitute or otherwise result in:
(i) in the case of a Plan subject to Section 406 of ERISA or Section 4975 of the
Code, a non-exempt prohibited transaction in violation of Section 406 of ERISA
or Section 4975 of the Code which is not covered by a class or other applicable
exemption and (ii) in the case of a Plan subject to a substantially Similar Law,
a non-exempt violation of such substantially Similar Law. Any transfer found to
have been made in violation of such deemed representation shall be null and void
and of no effect.
Section 2.13 Transfer Restrictions. Each Noteholder and Note
Owner of a Reset Rate Note shall be subject to the restrictions on transfer
thereof set forth in Appendix A-3 to this Indenture. Each Noteholder and Note
Owner of a Class A-5 Note shall be subject to the restrictions on transfer
thereof set forth in Appendix A-4 to this Indenture.
ARTICLE III
COVENANTS
Section 3.1 Payment to Noteholders and each Swap Counterparty.
The Issuer shall duly and punctually pay the principal and interest, if any,
with respect to the Notes in accordance with the terms of the Notes and this
Indenture and shall duly and punctually pay amounts, if any, owing to each Swap
Counterparty in accordance with the terms of this Indenture and the related Swap
Agreement. Without limiting the foregoing, the Issuer shall cause to be
distributed to Noteholders and each Swap Counterparty in accordance with the
Administration Agreement that portion of the amounts on deposit in the Trust
Accounts on a Distribution Date or with respect to any Swap Counterparty amounts
on deposit in the relevant Trust Accounts on the date such payment is due under
the related Swap Agreement, which the Noteholders and any Swap Counterparty are
entitled to receive pursuant to Sections 2.7 and 2.8 of the Administration
Agreement. Amounts properly withheld under the Code by any Person from a payment
to any Noteholder of interest and/or principal shall be considered as having
been paid by the Issuer to such Noteholder for all purposes of this Indenture.
Section 3.2 Maintenance of Office or Agency. The Issuer shall
maintain in the Borough of Manhattan, The City of New York and in Luxembourg, an
office or agency where Notes may be surrendered for registration of transfer or
exchange, and where notices and demands to or upon the Issuer in respect of the
Notes and this Indenture may be served. The Issuer hereby initially appoints the
Indenture Trustee to serve as its agent for the foregoing purposes. The Issuer
shall give prompt written notice to the Indenture Trustee of the location, and
of any change in the location, of any such office or agency. If at any time the
Issuer shall fail to maintain any such office or agency or shall fail to furnish
the Indenture Trustee with the address thereof, such surrenders, notices and
demands may be made or served at the Corporate
-11-
Trust Office, and the Issuer hereby appoints the Indenture Trustee as its agent
to receive all such surrenders, notices and demands.
Section 3.3 Money for Payments to be Held in Trust. As
provided in Section 8.2(a) and (b), all payments of amounts due and payable with
respect to any Notes or any Swap Agreement that are to be made from amounts
distributed from the Collection Account or any other Trust Account pursuant to
Sections 2.7 and 2.8 of the Administration Agreement shall be made on behalf of
the Issuer by the Indenture Trustee or by another Paying Agent, and no amounts
so distributed from the Collection Account for payments of Notes or any Swap
Agreement shall be paid over to the Issuer except as provided in this Section.
On or before the Business Day next preceding each Distribution
Date and Redemption Date, the Issuer shall distribute or cause to be distributed
to the Indenture Trustee (or any other Paying Agent) an aggregate sum sufficient
to pay the amounts then becoming due under the Notes or any Swap Agreement, such
sum to be held in trust for the benefit of the Persons entitled thereto and
(unless the Paying Agent is the Indenture Trustee) shall promptly notify the
Indenture Trustee of its action or failure so to act.
The Issuer shall cause each Paying Agent other than the
Indenture Trustee to execute and deliver to the Indenture Trustee an instrument
in which such Paying Agent shall agree with the Indenture Trustee (and if the
Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the
provisions of this Section, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts
due with respect to the Notes or any Swap Agreement in trust for the
benefit of the Persons entitled thereto until such sums shall be paid
to such Persons or otherwise disposed of as herein provided and pay
such sums to such Persons as herein provided;
(ii) give the Indenture Trustee notice of any default by
the Issuer of which it has actual knowledge (or any other obligor upon
the Notes) in the making of any payment required to be made with
respect to the Notes or any Swap Agreement;
(iii) at any time during the continuance of any such
default, upon the written request of the Indenture Trustee, forthwith
pay to the Indenture Trustee all sums so held in trust by such Paying
Agent;
(iv) immediately resign as a Paying Agent and forthwith
pay to the Indenture Trustee all sums held by it in trust for the
payment of Notes or any Swap Agreement if at any time it ceases to meet
the standards required to be met by a Paying Agent at the time of its
appointment; and
(v) comply with all requirements of the Code with respect
to the withholding from any payments made by it on any Notes of any
applicable withholding taxes imposed thereon and with respect to any
applicable reporting requirements in connection therewith.
The Issuer may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, by Issuer
Order direct any Paying Agent to
-12-
pay to the Indenture Trustee all sums held in trust by such Paying Agent, such
sums to be held by the Indenture Trustee upon the same trusts as those upon
which the sums were held by such Paying Agent; and upon such payment by any
Paying Agent to the Indenture Trustee, such Paying Agent shall be released from
all further liability with respect to such money.
Subject to applicable laws with respect to escheat of funds,
any money held by the Indenture Trustee or any Paying Agent in trust for the
payment of any amount due with respect to any Note and remaining unclaimed for
two years after such amount has become due and payable shall be discharged from
such trust and be paid to the Issuer on Issuer Request or if the Issuer has been
terminated to the Depositor upon its written request; and the Noteholder thereof
shall thereafter, as an unsecured general creditor, look only to the Issuer for
payment thereof (but only to the extent of the amounts so paid to the Issuer),
and all liability of the Indenture Trustee or such Paying Agent with respect to
such trust money shall thereupon cease; provided, however, that the Indenture
Trustee or such Paying Agent, before being required to make any such repayment,
shall at the expense and direction of the Issuer cause to be published once, in
a newspaper published in the English language, customarily published on each
Business Day and of general circulation in The City of New York and in
Luxembourg, notice that such money remains unclaimed and that, after a date
specified therein, which shall not be less than 30 days from the date of such
publication, any unclaimed balance of such money then remaining will be repaid
to the Issuer. The Indenture Trustee shall also adopt and employ, at the expense
of the Issuer, any other reasonable means of notification of such repayment
(including mailing notice of such repayment to Noteholders whose Notes have been
called but have not been surrendered for redemption or whose right to or
interest in moneys due and payable but not claimed is determinable from the
records of the Indenture Trustee or of any Paying Agent, at the last address of
record for each such Noteholder).
Section 3.4 Existence. The Issuer shall keep in full effect
its existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States of
America, in which case the Issuer shall keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and shall
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Indenture Trust Estate.
Section 3.5 Protection of Indenture Trust Estate. The Issuer
will from time to time execute and deliver all such supplements and amendments
hereto, all such financing statements and continuation statements and will take
such other action necessary or advisable to:
(i) maintain or preserve the lien and security interest
(and the priority thereof) of this Indenture or carry out more
effectively the purposes hereof;
(ii) perfect, publish notice of or protect the validity of
any grant made or to be made by this Indenture;
(iii) enforce any of the Collateral; or
-13-
(iv) preserve and defend title to the Indenture Trust
Estate and the rights of the Indenture Trustee, the Noteholders and
each Swap Counterparty in such Indenture Trust Estate against the
claims of all persons and parties.
The Issuer hereby designates the Indenture Trustee its agent
and attorney-in-fact to execute any financing statement, continuation statement
or other instrument required to be executed pursuant to this Section.
Section 3.6 Opinions as to Indenture Trust Estate. (a) On the
Closing Date, the Issuer shall furnish to the Indenture Trustee an Opinion of
Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording and filing of this Indenture as is
necessary to perfect and make effective the lien and security interest of this
Indenture and reciting the details of such action, or stating that, in the
opinion of such counsel, no such action is necessary to make such lien and
security interest effective.
(b) On or before December 31 in each calendar year,
beginning in 2003, the Issuer shall furnish to the Indenture Trustee an Opinion
of Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, filing, re-recording and refiling of
this Indenture and any indentures supplemental hereto as is necessary to
maintain the lien and security interest created by this Indenture and relating
the details of such action or stating that in the opinion of such counsel no
such action is necessary to maintain such lien and security interest. Such
Opinion of Counsel shall also describe the recording, filing, recording and
refiling of this Indenture and any indentures supplemental hereto that will, in
the opinion of such counsel, be required to maintain the lien and security
interest of this Indenture until December 31 in the following calendar year.
Section 3.7 Performance of Obligations; Servicing of Trust
Student Loans. (a) The Issuer will not take any action and will use its best
efforts not to permit any action to be taken by others that would release any
Person from any of such Person's material covenants or obligations under any
instrument or agreement included in the Indenture Trust Estate or that would
result in the amendment, hypothecation, subordination, termination or discharge
of, or impair the validity or effectiveness of, any such instrument or
agreement, except as expressly provided in this Indenture, any other Basic
Document or such other instrument or agreement.
(b) The Issuer may contract with other Persons to assist
it in performing its duties under this Indenture, and any performance of such
duties by a Person identified to the Indenture Trustee in an Officers'
Certificate of the Issuer shall be deemed to be action taken by the Issuer;
provided, however, the Issuer shall not be liable for any acts of Persons with
whom the Issuer has contracted with reasonable care. Initially, the Issuer has
contracted with the Servicer and the Administrator to assist the Issuer in
performing its duties under this Indenture. The Issuer shall give written notice
to the Indenture Trustee and each Rating Agency of any such contract with any
other Person.
(c) The Issuer shall punctually perform and observe all
of its obligations and agreements contained in this Indenture, the other Basic
Documents and the instruments and agreements included in the Indenture Trust
Estate, including filing or causing to be filed all UCC financing statements and
continuation statements prepared by the Issuer and required to be filed
-14-
by the terms of this Indenture and the Administration Agreement in accordance
with and within the time periods provided for herein and therein. Except as
otherwise expressly provided therein, the Issuer shall not waive, amend, modify,
supplement or terminate any Basic Document or any provision thereof without the
consent of the Indenture Trustee or the Noteholders of at least a majority of
the Outstanding Amount of the Notes. The Issuer shall give written notice to
each Rating Agency of any such waiver, amendment, modification, supplement or
termination.
(d) If a Responsible Officer of the Issuer shall have
knowledge of the occurrence of a Servicer Default or an Administrator Default
under the Servicing Agreement or the Administration Agreement, respectively, the
Issuer shall promptly notify the Indenture Trustee and the Rating Agencies
thereof, and shall specify in such notice the action, if any, the Issuer is
taking with respect to such default. If a Servicer Default shall arise from the
failure of the Servicer to perform any of its duties or obligations under the
Servicing Agreement, or an Administrator Default shall arise from the failure of
the Administrator to perform any of its duties or obligations under the
Administration Agreement, as the case may be, with respect to the Trust Student
Loans, the Issuer shall take all reasonable steps available to it to enforce its
rights under the Basic Documents in respect of such failure.
(e) As promptly as possible after the giving of notice of
termination to the Servicer of the Servicer's rights and powers, pursuant to
Section 5.1 of the Servicing Agreement, or to the Administrator of the
Administrator's rights and powers, pursuant to Section 5.1 of the Administration
Agreement, the Issuer shall appoint a successor servicer (the "Successor
Servicer") or a successor administrator (the "Successor Administrator"),
respectively, and such Successor Servicer or Successor Administrator, as the
case may be, shall accept its appointment by a written assumption in a form
acceptable to the Indenture Trustee. In the event that a Successor Servicer or
Successor Administrator has not been appointed and accepted its appointment at
the time when the Servicer or Administrator, as the case may be, ceases to act
as Servicer or Administrator, respectively, the Indenture Trustee without
further action shall automatically be appointed the Successor Servicer or
Successor Administrator, as the case may be. The Indenture Trustee may resign as
the Successor Servicer or the Successor Administrator by giving written notice
of resignation to the Issuer and in such event will be released from such duties
and obligations, such release not to be effective until the date a new servicer
or a new administrator enters into an agreement with the Issuer as provided
below; provided, however, that nothing herein shall require or permit the
Indenture Trustee to act as Servicer, or otherwise service the Trust Student
Loans, in violation of the Higher Education Act. Upon delivery of any such
notice to the Issuer, the Issuer shall obtain a new servicer as the Successor
Servicer under the Servicing Agreement or a new administrator as the Successor
Administrator under the Administration Agreement, as the case may be. Any
Successor Servicer or Successor Administrator, other than the Indenture Trustee,
shall (i) be an established institution (A) that satisfies any requirements of
the Higher Education Act applicable to servicers and (B) whose regular business
includes the servicing or administration of student loans and (ii) enter into a
servicing agreement or an administration agreement, respectively, with the
Issuer having substantially the same provisions as the provisions of the
Servicing Agreement and the Administration Agreement, as applicable. If within
30 days after the delivery of the notice referred to above, the Issuer shall not
have obtained such a new servicer or new administrator, as the case may be, the
Indenture Trustee may appoint, or may petition a court of competent jurisdiction
to appoint, a Successor Servicer or Successor Administrator; provided, however,
that
-15-
such right to appoint or to petition for the appointment of any such successor
shall in no event relieve the Indenture Trustee from any obligations otherwise
imposed on it under the Basic Documents until such successor has in fact assumed
such appointment. In connection with any such appointment, the Indenture Trustee
may make such arrangements for the compensation of such successor as it and such
successor shall agree, subject to the limitations set forth below and in the
Servicing Agreement or Administration Agreement, as applicable, and in
accordance with Section 5.2 of the Servicing Agreement and Section 5.2 of the
Administration Agreement, the Issuer shall enter into an agreement with such
successor for the servicing or administration of the Trust Student Loans (such
agreement to be in form and substance satisfactory to the Indenture Trustee). If
the Indenture Trustee shall succeed as provided herein to the Servicer's duties
as Servicer with respect to the Trust Student Loans, or the Administrator's
duties with respect to the Issuer and the Trust Student Loans, as the case may
be, it shall do so in its individual capacity and not in its capacity as
Indenture Trustee and, accordingly, the provisions of Article VI hereof shall be
inapplicable to the Indenture Trustee in its duties as the successor to the
Servicer or the Administrator, as the case may be, and the servicing or
administration of the Trust Student Loans. In case the Indenture Trustee shall
become successor to the Servicer or the Administrator, the Indenture Trustee
shall be entitled to appoint as Servicer or as Administrator, as the case may
be, any one of its Affiliates, provided that such appointment shall not affect
or alter in any way the liability of the Indenture Trustee as Successor Servicer
or Successor Administrator, respectively, in accordance with the terms hereof.
(f) Upon any termination of the Servicer's rights and
powers pursuant to the Servicing Agreement, or any termination of the
Administrator's rights and powers pursuant to the Administration Agreement, as
the case may be, the Issuer shall promptly notify the Indenture Trustee and each
Rating Agency. As soon as a Successor Servicer or a Successor Administrator is
appointed, the Issuer shall notify the Indenture Trustee and each Rating Agency
of such appointment, specifying in such notice the name and address of such
Successor Servicer or such Successor Administrator.
(g) Without derogating from the absolute nature of the
assignment granted to the Indenture Trustee under this Indenture or the rights
of the Indenture Trustee hereunder, the Issuer agrees that it will not, without
the prior written consent of the Indenture Trustee or the Noteholders of at
least a majority in Outstanding Amount of the Notes, amend, modify, waive,
supplement, terminate or surrender, or agree to any amendment, modification,
supplement, termination, waiver or surrender of, the terms of any Collateral or
the Basic Documents, except to the extent otherwise provided in the Basic
Documents, or waive timely performance or observance by the Servicer, the
Administrator, the Depositor, the holder of the Excess Distribution Certificate,
Xxxxxx Xxx, the Issuer or the Eligible Lender Trustee or any Swap Counterparty
under the Basic Documents; provided, however, that no such amendment shall (i)
increase or reduce in any manner the amount of, or accelerate or delay the
timing of, distributions that are required to be made for the benefit of the
Noteholders or any Swap Counterparty, or (ii) reduce the aforesaid percentage of
the Notes which are required to consent to any such amendment, without the
consent of the Noteholders of all the Outstanding Notes. If any such amendment,
modification, supplement or waiver shall be so consented to by the Indenture
Trustee or such Noteholders, the Issuer shall give written notice thereof to
each Rating Agency and agrees, promptly following a request by the Indenture
Trustee to do so, to execute and deliver, in its own name and at its own
expense, such agreements, instruments, consents and
-16-
other documents as the Indenture Trustee may deem necessary or appropriate in
the circumstances.
Section 3.8 Negative Covenants. So long as any Notes are
Outstanding, the Issuer shall not:
(i) except as expressly permitted by this Indenture or
any other Basic Document, sell, transfer, exchange or otherwise dispose
of any of the properties or assets of the Issuer, including those
included in the Indenture Trust Estate, unless directed to do so by the
Indenture Trustee;
(ii) claim any credit on, or make any deduction from the
principal or interest payable in respect of, the Notes (other than
amounts properly withheld from such payments under the Code or
applicable state law) or assert any claim against any present or former
Noteholder by reason of the payment of the taxes levied or assessed
upon any part of the Indenture Trust Estate;
(iii) (A) permit the validity or effectiveness of this
Indenture to be impaired, or permit the lien of this Indenture to be
amended, hypothecated, subordinated, terminated or discharged, or
permit any Person to be released from any covenants or obligations with
respect to the Notes under this Indenture except as may be expressly
permitted hereby, (B) permit any lien, charge, excise, claim, security
interest, mortgage or other encumbrance (other than the lien of this
Indenture) to be created on or extend to or otherwise arise upon or
burden the Indenture Trust Estate or any part thereof or any interest
therein or the proceeds thereof (other than tax liens and other liens
that arise by operation of law, and other than as expressly permitted
by the Basic Documents) or (C) permit the lien of this Indenture not to
constitute a valid first priority (other than with respect to any such
tax or other lien) security interest in the Indenture Trust Estate; or
(iv) enter into any amendment to the Interest Rate Cap
Agreement or any Swap Agreement to cure any ambiguity in, or to correct
or supplement any provision of the Interest Rate Cap Agreement or any
Swap Agreement, unless the Issuer has determined, and the Indenture
Trustee has agreed in writing at the written direction of the Issuer,
that the amendment will not materially adversely affect the interests
of the Noteholders and provided that the Issuer has provided reasonable
notice to the Rating Agencies of such amendment and the Rating Agency
Condition is satisfied.
Section 3.9 Annual Statement as to Compliance. The Issuer will
deliver to the Indenture Trustee and each Rating Agency, within 120 days after
the end of each fiscal year of the Issuer (commencing with the fiscal year
ending December 31, 2004), an Officers' Certificate of the Issuer stating that:
(i) a review of the activities of the Issuer during such
year and of performance under this Indenture has been made under such
Authorized Officers' supervision; and
(ii) to the best of such Authorized Officers' knowledge,
based on such review, the Issuer has complied with all conditions and
covenants under this Indenture throughout
-17-
such year, or, if there has been a default in the compliance of any
such condition or covenant, specifying each such default known to such
Authorized Officers and the nature and status thereof.
Section 3.10 Issuer May Consolidate, etc. , Only on Certain
Terms. (a) The Issuer shall not consolidate or merge with or into any other
Person, unless:
(i) the Person (if other than the Issuer) formed by or
surviving such consolidation or merger shall be a Person organized and
existing under the laws of the United States of America or any State
and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in form satisfactory
to the Indenture Trustee, the due and punctual payment of the principal
of, and interest, if any, on all Notes and the performance or
observance of every agreement and covenant of this Indenture and the
other Basic Documents on the part of the Issuer to be performed or
observed, all as provided herein;
(ii) immediately after giving effect to such transaction,
no Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such transaction will not have any material adverse
Federal or Delaware state tax consequence to the Issuer or any
Noteholder or any Swap Counterparty;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate of the Issuer and an Opinion of
Counsel each stating that such consolidation or merger and such
supplemental indenture comply with this Article III and that all
conditions precedent herein provided for relating to such transaction
have been complied with (including any filing required by the Exchange
Act).
(b) The Issuer shall not convey or transfer all or
substantially all of its properties or assets, including those included in the
Indenture Trust Estate, to any Person, unless:
(i) the Person that acquires by conveyance or transfer
the properties and assets of the Issuer the conveyance or transfer of
which is hereby restricted shall (A) be a United States citizen or a
Person organized and existing under the laws of the United States of
America or any State, (B) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Indenture Trustee,
in form satisfactory to the Indenture Trustee, the due and punctual
payment of the principal of, and interest, if any, on all Notes and the
performance or observance of every agreement and covenant of this
Indenture on the part of the Issuer to be performed or observed, all as
provided herein, (C) expressly agree by means of such supplemental
indenture that all right, title and
-18-
interest so conveyed or transferred shall be subject and subordinate to
the rights of Noteholders and any Cross-Currency Swap Counterparty, (D)
unless otherwise provided in such supplemental indenture, expressly
agree to indemnify, defend and hold harmless the Issuer against and
from any loss, liability or expense arising under or related to this
Indenture and the Notes and (E) expressly agree by means of such
supplemental indenture that such Person (or if a group of Persons, then
one specified Person) shall make all filings with the Commission (and
any other appropriate Person) required by the Exchange Act in
connection with the Notes;
(ii) immediately after giving effect to such transaction,
no Default shall have occurred and be continuing;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such transaction;
(iv) the Issuer shall have received an Opinion of Counsel
(and shall have delivered copies thereof to the Indenture Trustee) to
the effect that such transaction will not have any material adverse
Federal or Delaware state tax consequence to the Issuer or any
Noteholder;
(v) any action as is necessary to maintain the lien and
security interest created by this Indenture shall have been taken; and
(vi) the Issuer shall have delivered to the Indenture
Trustee an Officers' Certificate of the Issuer and an Opinion of
Counsel each stating that such conveyance or transfer and such
supplemental indenture comply with this Article III and that all
conditions precedent herein provided for relating to such transaction
have been complied with (including any filing required by the Exchange
Act).
Section 3.11 Successor or Transferee. (a) Upon any
consolidation or merger of the Issuer in accordance with Section 3.10(a), the
Person formed by or surviving such consolidation or merger (if other than the
Issuer) shall succeed to, and be substituted for, and may exercise every right
and power of, the Issuer under this Indenture with the same effect as if such
Person had been named as the Issuer herein.
(b) Upon a conveyance or transfer of all the assets and
properties of the Issuer pursuant to Section 3.10(b), SLM Student Loan Trust
2003-12 will be released from every covenant and agreement of this Indenture to
be observed or performed on the part of the Issuer with respect to the Notes
immediately upon the delivery by the Issuer of written notice to the Indenture
Trustee stating that SLM Student Loan Trust 2003-12 is to be so released.
Section 3.12 No Other Business. The Issuer shall not engage in
any business other than financing (including entering into Swap Agreements from
time to time), purchasing, owning, selling and managing the Trust Student Loans
and the other assets of the Issuer and related proceeds in the manner
contemplated by this Indenture and the other Basic Documents and activities
incidental thereto.
-19-
Section 3.13 No Borrowing. The Issuer shall not issue, incur,
assume, guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.
Section 3.14 Obligations of Servicer and Administrator. The
Issuer shall cause the Servicer to comply with Sections 3.1, 3.2 and 3.3 of the
Administration Agreement and Section 3.7 of the Servicing Agreement and the
Administrator to comply with Sections 2.11, 3.1, 3.2 and 3.3 of the
Administration Agreement.
Section 3.15 Guarantees, Loans, Advances and Other
Liabilities. Except as contemplated by this Indenture and the other Basic
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another's payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any stock,
obligations, assets or securities of, or any other interest in, or make any
capital contribution to, any other Person.
Section 3.16 Capital Expenditures. The Issuer shall not make
any expenditure (by long-term or operating lease or otherwise) for capital
assets (either realty or personalty).
Section 3.17 Restricted Payments. The Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities or a
combination thereof, to the Eligible Lender Trustee or any owner of a beneficial
interest in the Issuer or otherwise with respect to any ownership or equity
interest or security in or of the Issuer or to the Servicer or the
Administrator, (ii) redeem, purchase, retire or otherwise acquire for value any
such ownership or equity interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose; provided, however, that the Issuer
may make, or cause to be made, distributions to the Servicer, the Eligible
Lender Trustee, the Indenture Trustee, the Noteholders, any Swap Counterparty,
any Remarketing Agent, any Swap Agent, the Administrator, the Depositor and the
holder of the Excess Distribution Certificate as contemplated by, and to the
extent funds are available for such purpose under, this Indenture and the other
Basic Documents. The Issuer will not, directly or indirectly, make payments to
or distributions from the Collection Account except in accordance with this
Indenture and the other Basic Documents.
Section 3.18 Notice of Events of Default. The Issuer shall
give the Indenture Trustee, the Rating Agencies and each Swap Counterparty
prompt written notice of each Event of Default hereunder and each default on the
part of Depositor of its obligations under the Sale Agreement, Xxxxxx Xxx of its
obligations under the Purchase Agreement, the Servicer of its obligations under
the Servicing Agreement, or the Administrator of its obligations under the
Administration Agreement. In addition, the Issuer shall deliver to the Indenture
Trustee, each Rating Agency and each Swap Counterparty, within five days after
the occurrence thereof, written notice in the form of an Officers' Certificate
of the Issuer of any event which with the giving of notice and the lapse of time
would become an Event of Default under Section 5.1(iii), its status and what
action the Issuer is taking or proposes to take with respect thereto.
-20-
Section 3.19 Further Instruments and Acts. Upon request of the
Indenture Trustee, the Issuer will execute and deliver such further instruments
and do such further acts as may be reasonably necessary or proper to carry out
more effectively the purpose of this Indenture.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1 Satisfaction and Discharge of Indenture. This
Indenture shall cease to be of further effect with respect to the Notes except
as to (i) rights of registration of transfer and exchange, (ii) substitution of
mutilated, destroyed, lost or stolen Notes, (iii) rights of Noteholders to
receive payments of principal thereof and interest thereon, (iv) Sections 3.3,
3.4, 3.5, 3.8, 3.10, 3.12 and 3.13, (v) the rights, obligations and immunities
of the Indenture Trustee hereunder (including, without limitation, the rights of
the Indenture Trustee under Section 6.7 and the obligations of the Indenture
Trustee under Section 4.2) and (vi) the rights of Noteholders as beneficiaries
hereof with respect to the property so deposited with the Indenture Trustee
payable to all or any of them, and the Indenture Trustee, on demand of and at
the expense of the Issuer, shall execute proper instruments acknowledging
satisfaction and discharge of this Indenture with respect to the Notes, when:
(a) either
(1) all Notes theretofore authenticated and delivered
(other than (i) Notes that have been destroyed, lost or stolen and that have
been replaced or paid as provided in Section 2.5 and (ii) Notes for whose
payment money has theretofore been deposited in trust or segregated and held in
trust by the Issuer and thereafter repaid to the Issuer or discharged from such
trust, as provided in Section 3.3) have been delivered to the Indenture Trustee
for cancellation; or
(2) all Notes not theretofore delivered to the Indenture
Trustee for cancellation
(i) have become due and payable,
(ii) will become due and payable at their respective Note
Final Maturity Date, within one year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Indenture Trustee for the giving of
notice of redemption by the Indenture Trustee in the name, and at the
expense, of the Issuer, and the Issuer, in the case of (i), (ii) or
(iii) above, has irrevocably deposited or caused to be irrevocably
deposited with the Indenture Trustee cash or direct obligations of or
obligations guaranteed by the United States of America (which will
mature prior to the date such amounts are payable), in trust for such
purpose, in an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore delivered to the Indenture
Trustee for cancellation when due to the Note Final Maturity Date;
-21-
(b) the Issuer has paid or caused to be paid all other
sums payable hereunder by the Issuer; and
(c) the Issuer has delivered to the Indenture Trustee an
Officers' Certificate of the Issuer, an Opinion of Counsel and (if required by
the TIA or the Indenture Trustee) an Independent Certificate from a firm of
certified public accountants, each meeting the applicable requirements of
Section 11.1(a) and, subject to Section 11.2, each stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of this
Indenture have been complied with.
Section 4.2 Application of Trust Money. All moneys deposited
with the Indenture Trustee pursuant to Section 4.1 hereof shall be held in trust
and applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent, as the
Indenture Trustee may determine, to the Noteholders of the particular Notes for
the payment or redemption of which such moneys have been deposited with the
Indenture Trustee, of all sums due and to become due thereon for principal and
interest; but such moneys need not be segregated from other funds except to the
extent required herein or in the Administration Agreement or required by law.
Section 4.3 Repayment of Moneys Held by Paying Agent. In
connection with the satisfaction and discharge of this Indenture with respect to
the Notes, all moneys then held by any Paying Agent other than the Indenture
Trustee under the provisions of this Indenture with respect to such Notes shall,
upon demand of the Issuer, be paid to the Indenture Trustee to be held and
applied according to Section 3.3 and thereupon such Paying Agent shall be
released from all further liability with respect to such moneys.
Section 4.4 Auction of Trust Student Loans. Any Trust Student
Loans remaining in the Trust as of the later of (a) the end of Collection Period
for the September 2013 Distribution Date or (b) the end of the first Collection
Period when the Pool Balance is equal to 10% or less of the initial Pool Balance
three Business Days prior to such Distribution Date (the "Trust Auction Date")
shall be offered for sale by the Indenture Trustee unless the Servicer has
exercised its option to purchase the Trust Estate as described in Section 6.1(a)
of the Administration Agreement with respect to such Distribution Date. The
Servicer will be deemed to have waived such option if it fails to notify the
Eligible Lender Trustee and the Indenture Trustee of its exercise thereof in
writing prior to the Indenture Trustee's acceptance of a bid to purchase such
Trust Student Loans; provided, however, that there shall be no such offer for
sale if the Indenture Trustee fails to provide notice to the Servicer in
accordance with this Section 4.4. The Indenture Trustee shall provide written
notice to the Servicer of any such offer for sale at least 5 Business Days in
advance of the Trust Auction Date. The Indenture Trustee shall permit the
Servicer or any of its Affiliates including Xxxxxx Xxx and the Servicer to offer
bids only if the Pool Balance as of the applicable Trust Auction Date is equal
to 10% or less of the Initial Pool Balance and such bid does not exceed the fair
market value of the Trust Student Loans as of the Trust Auction Date. If at
least two bids are received, the Indenture Trustee shall solicit and resolicit
new bids from all participating bidders until only one bid remains or the
remaining bidders decline to resubmit bids. The Indenture Trustee shall accept
the highest of such remaining bids if it is equal to or in excess of both the
Minimum Purchase Amount and the fair market value of such Trust Student Loans as
of the end of the Collection Period immediately
-22-
preceding the Trust Auction Date. If at least two bids are not received or the
highest bid after the resolicitation process is completed is not equal to or in
excess of the higher of the Minimum Purchase Amount and the fair market value of
the Trust Student Loans, the Indenture Trustee shall not consummate such sale.
The Indenture Trustee may consult, and, at the direction of the Depositor, shall
consult, with a financial advisor, including an Initial Purchaser of the Notes
or the Administrator, to determine if the fair market value of the Trust Student
Loans has been offered. The proceeds of any such sale will be paid at the time
set forth in Section 2.6 of the Administration Agreement and applied in the
order of priority set forth in Section 5.4(b). If the sale is not consummated in
accordance with the foregoing, the Indenture Trustee may, but shall not be under
any obligation to, solicit bids for sale of the Trust Student Loans with respect
to future Distribution Dates upon terms similar to those described above,
including the Servicer's waiver of its option to purchase the Trust Estate in
accordance with Section 6.1(a) of the Administration Agreement with respect to
each such future Distribution Date.
ARTICLE V
REMEDIES
Section 5.1 Events of Default. "Event of Default," wherever
used herein, means any one of the following events (whatever the reason for such
Event of Default and whether it shall be voluntary or involuntary or be effected
by operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):
(i) default in the payment of any interest on any Note
when the same becomes due and payable, and such default shall continue
for a period of five days; or
(ii) default in the payment of the principal of any Note
when the same becomes due and payable on the related Note Final
Maturity Date; or
(iii) default in the observance or performance of any
covenant or agreement of the Issuer made in this Indenture (other than
a covenant or agreement, a default in the observance or performance of
which is elsewhere in this Section specifically dealt with), or any
representation or warranty of the Issuer made in this Indenture or in
any certificate or other writing having been incorrect in any material
respect as of the time when made, such default or breach having a
material adverse effect on the holders of the Notes, and such default
or breach shall continue or not be cured, or the circumstance or
condition in respect of which such misrepresentation or warranty was
incorrect shall not have been eliminated or otherwise cured, for a
period of 30 days after there shall have been given, by registered or
certified mail, to the Issuer by the Indenture Trustee or to the Issuer
and the Indenture Trustee by the Noteholders of at least 25% of the
Outstanding Amount of the Notes, a written notice specifying such
default or incorrect representation or warranty and requiring it to be
remedied and stating that such notice is a notice of Default hereunder;
or
(iv) the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any
substantial part of the Indenture Trust Estate
-23-
in an involuntary case under any applicable Federal or state
bankruptcy, insolvency or other similar law now or hereafter in effect,
or appointing a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial
part of the Indenture Trust Estate, or ordering the winding-up or
liquidation of the Issuer's affairs, and such decree or order shall
remain unstayed and in effect for a period of 60 consecutive days; or
(v) the commencement by the Issuer of a voluntary case
under any applicable Federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or the consent by the Issuer to
the entry of an order for relief in an involuntary case under any such
law, or the consent by the Issuer to the appointment or taking
possession by a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Issuer or for any substantial
part of the Indenture Trust Estate, or the making by the Issuer of any
general assignment for the benefit of creditors, or the failure by the
Issuer generally to pay its debts as such debts become due, or the
taking of action by the Issuer in furtherance of any of the foregoing.
Section 5.2 Acceleration of Maturity; Rescission and
Annulment. If an Event of Default should occur and be continuing, then and in
every such case the Indenture Trustee or the Noteholders representing not less
than a majority of the Outstanding Amount of the Notes may declare all the Notes
to be immediately due and payable, by a notice in writing to the Issuer (and to
the Indenture Trustee if given by Noteholders), and upon any such declaration
the unpaid principal amount of such Notes, together with accrued and unpaid
interest thereon through the date of acceleration, shall become immediately due
and payable, subject, however, to Section 5.4 of this Indenture.
At any time after such declaration of acceleration of maturity
has been made and before a judgment or decree for payment of the money due has
been obtained by the Indenture Trustee as hereinafter in this Article V
provided, the Noteholders of Notes representing a majority of the Outstanding
Amount of the Notes, by written notice to the Issuer and the Indenture Trustee,
may rescind and annul such declaration and its consequences if:
(i) the Issuer has paid or deposited with the Indenture
Trustee a sum sufficient to pay:
(a) all payments of principal of and interest on
all Notes and all other amounts that would then be due
hereunder or upon such Notes if the Event of Default giving
rise to such acceleration had not occurred; and
(b) all sums paid or advanced by the Indenture
Trustee hereunder and the reasonable compensation, expenses,
disbursements and advances of the Indenture Trustee and its
agents and counsel; and
(ii) all Events of Default, other than the nonpayment of
the principal of the Notes that has become due solely by such
acceleration, have been cured or waived as provided in Section 5.12.
-24-
No such rescission shall affect any subsequent default or
impair any right consequent thereto.
Section 5.3 Collection of Indebtedness and Suits for
Enforcement by Indenture Trustee. The Issuer covenants that if (i) default is
made in the payment of any interest on any Note when the same becomes due and
payable, and such default continues for a period of five days, or (ii) default
is made in the payment of the principal of any Note when the same becomes due
and payable at the related Note Final Maturity Date, the Issuer shall, upon
demand of the Indenture Trustee, pay to it, for the benefit of the Noteholders,
the whole amount then due and payable on such Notes for principal and interest,
with interest upon the overdue principal, and, to the extent payment at such
rate of interest shall be legally enforceable, upon overdue installments of
interest, at the rate specified in Section 2.7 and in addition thereto such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, expenses, disbursements and
advances of the Indenture Trustee and its agents and counsel.
(a) In case the Issuer shall fail forthwith to pay such
amounts upon such demand, the Indenture Trustee, in its own name and as trustee
of an express trust, may institute a Proceeding for the collection of the sums
so due and unpaid, and may prosecute such Proceeding to judgment or final
decree, and may enforce the same against the Issuer or other obligor upon such
Notes and collect in the manner provided by law out of the property of the
Issuer or other obligor upon such Notes, wherever situated, the moneys adjudged
or decreed to be payable.
(b) If an Event of Default occurs and is continuing, the
Indenture Trustee may, as more particularly provided in Section 5.4, in its
discretion, proceed to protect and enforce its rights and the rights of the
Noteholders and any Cross-Currency Swap Counterparty by such appropriate
Proceedings as the Indenture Trustee shall deem most effective to protect and
enforce any such rights, whether for the specific enforcement of any covenant or
agreement in this Indenture or in aid of the exercise of any power granted
herein, or to enforce any other proper remedy or legal or equitable right vested
in the Indenture Trustee by this Indenture or by law.
(c) In case there shall be pending, relative to the
Issuer or any other obligor upon the Notes or any Person having or claiming an
ownership interest in the Indenture Trust Estate, Proceedings under Title 11 of
the United States Code or any other applicable Federal or state bankruptcy,
insolvency or other similar law, or in case a receiver, assignee or trustee in
bankruptcy or reorganization, liquidator, sequestrator or similar official shall
have been appointed for or taken possession of the Issuer or its property or
such other obligor or Person, or in case of any other, comparable judicial
Proceedings relative to the Issuer or other obligor upon the Notes, or to the
creditors or property of the Issuer or such other obligor, the Indenture
Trustee, irrespective of whether the principal of any Notes shall then be due
and payable, as therein expressed or by declaration or otherwise and
irrespective of whether the Indenture Trustee shall have made any demand
pursuant to the provisions of this Section, shall be entitled and empowered, by
intervention in such proceedings or otherwise:
-25-
(i) to file and prove a claim or claims for the whole
amount of principal and interest owing and unpaid in respect of the
Notes and to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Indenture Trustee
(including any claim for reasonable compensation to the Indenture
Trustee and each predecessor Indenture Trustee, and their respective
agents, attorneys and counsel, and for reimbursement of all expenses
and liabilities incurred, and all advances made, by the Indenture
Trustee and each predecessor Indenture Trustee, except as a result of
negligence or bad faith) and of the Noteholders allowed in such
Proceedings;
(ii) unless prohibited by applicable law and regulations,
to vote on behalf of the Noteholders (and, if applicable, any
Cross-Currency Swap Counterparty) in any election of a trustee, a
standby trustee or Person performing similar functions in any such
Proceedings;
(iii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute all amounts
received with respect to the claims of the Noteholders, any
Cross-Currency Swap Counterparty and the Indenture Trustee on their
behalf; and
(iv) to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims
of the Indenture Trustee, any Cross-Currency Swap Counterparty or the
Noteholders allowed in any judicial proceedings relative to the Issuer,
its creditors and its property;
and any trustee, receiver, liquidator, custodian or other similar official in
any such Proceeding is hereby authorized by each of such Noteholders and any
Cross-Currency Swap Counterparty to make payments to the Indenture Trustee, and,
in the event that the Indenture Trustee shall consent to the making of payments
directly to such Noteholders and any Cross-Currency Swap Counterparty to pay to
the Indenture Trustee such amounts as shall be sufficient to cover reasonable
compensation to the Indenture Trustee, each predecessor Indenture Trustee and
their respective agents, attorneys and counsel, and all other expenses and
liabilities incurred, and all advances made, by the Indenture Trustee and each
predecessor Indenture Trustee except as a result of negligence or bad faith.
(d) Nothing herein contained shall be deemed to authorize
the Indenture Trustee to authorize or consent to or vote for or accept or adopt
on behalf of any Noteholder any plan of reorganization, arrangement, adjustment
or composition affecting the Notes or the rights of any Noteholder thereof or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder in any such proceeding except, as aforesaid, to vote for the election
of a trustee in bankruptcy or similar Person.
(e) All rights of action and of asserting claims under
this Indenture, or under any of the Notes, may be enforced by the Indenture
Trustee without the possession of any of the Notes or the production thereof in
any trial or other Proceedings relative thereto, and any such action or
Proceedings instituted by the Indenture Trustee shall be brought in its own name
as trustee of an express trust, and any recovery of judgment, subject to the
payment of the expenses, disbursements and compensation of the Indenture
Trustee, each predecessor Indenture Trustee
-26-
and their respective agents and attorneys, shall be for the ratable benefit of
the Noteholders, and after the Notes have been paid in full, and subject to the
provisions of Section 11.19, any Cross-Currency Swap Counterparty.
(f) In any Proceedings brought by the Indenture Trustee
(and also any Proceedings involving the interpretation of any provision of this
Indenture to which the Indenture Trustee shall be a party), the Indenture
Trustee shall be held to represent all the Noteholders and each Cross-Currency
Swap Counterparty, and it shall not be necessary to make any Noteholder or any
Cross-Currency Swap Counterparty a party to any such Proceedings.
Section 5.4 Remedies; Priorities. If an Event of Default shall
have occurred and be continuing, the Indenture Trustee may do one or more of the
following (subject to Section 5.5):
(a) (i) institute Proceedings in its own name and as
trustee of an express trust for the collection of all amounts then payable on
the Notes or under this Indenture with respect thereto, whether by declaration
or otherwise, enforce any judgment obtained, and collect from the Issuer and any
other obligor upon such Notes moneys adjudged due;
(ii) institute Proceedings from time to time for the
complete or partial foreclosure of this Indenture, with respect to the
Indenture Trust Estate;
(iii) exercise any remedies of a secured party under the
UCC with respect to the Trust Estate and take any other appropriate
action to protect and enforce the rights and remedies of the Indenture
Trustee, any Cross-Currency Swap Counterparty and the Noteholders;
(iv) sell the Indenture Trust Estate or any portion
thereof or rights or interest therein, at one or more public or private
sales called and conducted in any manner permitted by law; and/or
(v) elect to have the Eligible Lender Trustee maintain
ownership of the Trust Student Loans and continue to apply collections
with respect to the Trust Student Loans as if there had been no
declaration of acceleration;
provided, however, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) with respect to the
Class A Notes, unless (A) the Noteholders of 100% of the Outstanding Amount of
the Class A Notes consent thereto, (B) the proceeds of such sale or liquidation
distributable to the Class A Noteholders are sufficient to discharge in full all
amounts then due and unpaid upon such Class A Notes for principal and interest
or (C) the Indenture Trustee determines that the Indenture Trust Estate will not
continue to provide sufficient funds for the payment of principal of and
interest on the Class A Notes as would have become due if the Class A Notes had
not been declared due and payable, and the Indenture Trustee obtains the consent
of Noteholders of 66-2/3% of the Outstanding Amount of the Class A Notes;
provided, further, that the Indenture Trustee may not sell or otherwise
liquidate the Indenture Trust Estate following an Event of Default, other than
an Event of Default described in Section 5.1(i) or (ii) with respect to the
Class A Notes, unless (D) the proceeds of such sale or liquidation
-27-
distributable to the Class B Noteholders plus the proceeds of the sale or
liquidation of the Trust Estate distributable to the Class B Noteholders are
sufficient to pay to the Class B Noteholders the Outstanding Amount of the Class
B Notes plus accrued and unpaid interest thereon or (E) after receipt of notice
from the Eligible Lender Trustee that the proceeds of such sale or liquidation
distributable to the Class B Noteholders plus the proceeds of the sale or
liquidation of the Trust Estate distributable to the Class B Noteholders would
not be sufficient to pay to the Class B Noteholders the outstanding principal
plus accrued and unpaid interest thereon, the Class B Noteholders of at least a
majority of the Outstanding Amount of the Class B Notes consent thereto. In
determining such sufficiency or insufficiency with respect to clauses (B), (C),
(D) and (E), the Indenture Trustee may, but need not, obtain and rely upon an
opinion of an Independent investment banking or accounting firm of national
reputation as to the feasibility of such proposed action and as to the
sufficiency of the Indenture Trust Estate and/or Trust Estate, as applicable,
for such purpose.
(b) Notwithstanding the provisions of Section 8.2,
following the occurrence and during the continuation of an Event of Default
specified in Section 5.1(i), 5.1(ii), 5.1(iv) or 5.1(v) which has resulted in an
acceleration of the Notes, if the Indenture Trustee collects any money or
property, it shall pay out the money or property (and other amounts including
amounts, if any, held on deposit in each of the Trust Accounts) held as
Collateral for the benefit of the Noteholders, net of liquidation costs
associated with the sale of the assets of the Trust, in the following order:
FIRST: to the applicable Noteholders of the Reset Rate Notes
then denominated in U.S. Dollars and bearing interest at a fixed rate, or if the
Reset Rate Notes are in Foreign Exchange Mode, to the related Cross-Currency
Swap Counterparty (for exchange into the applicable non-U.S. Dollar Currency)
the amount, if any, on deposit in the Accumulation Account for the Reset Rate
Notes (excluding any Investment Earnings thereon) in reduction of the
Outstanding Amount of the Reset Rate Notes until they are paid in full;
SECOND: to the Indenture Trustee for amounts due under Section
6.7;
THIRD: to the Servicer for due and unpaid Primary Servicing
Fees;
FOURTH: to the Administrator, any due and unpaid
Administration Fees;
FIFTH: pro rata, based on amounts due and owing:
A: to the Class A Noteholders (other than the Reset Rate
Noteholders if a Swap Agreement is then in effect),
for amounts due and unpaid on the Class A Notes for
interest at the applicable Note Rate, ratably,
without preference or priority of any kind, according
to the amounts due and payable on the Class A Notes
for such interest;
B: if a Swap Agreement is then in effect, to each Swap
Counterparty, the amount of any Swap Interest
Payments due and payable by the Issuer (other than as
paid to that Swap Counterparty under clause FIRST);
and
-28-
C: if any Swap Agreement has been terminated, to the
related Swap Counterparty, the amount of any Swap
Termination Payments due to such Swap Counterparty
due to a Termination Event (as defined in the related
Swap Agreement) resulting from a payment default
under the related Swap Agreement by the Issuer, a
non-rescindable, non-waivable acceleration of the
Notes, or the bankruptcy or insolvency of the Issuer.
SIXTH:
A: If the Reset Rate Notes are then in Foreign Exchange
Mode, pro rata (1) to the Class A Noteholders (other
than the holders of the Reset Rate Notes then in
Foreign Exchange Mode), ratably, an amount sufficient
to reduce the respective principal balance of those
Class A Notes to zero, and (2) to the related
Cross-Currency Swap Counterparty an amount sufficient
to reduce the U.S. Dollar Equivalent Principal Amount
of the Reset Rate Notes to zero; or
B if the Reset Rate Notes are then denominated in U.S.
Dollars, pro rata to all of the Class A Noteholders,
ratably, an amount sufficient to reduce the
respective principal balances of the Class A Notes to
zero;
SEVENTH: to the Class B Noteholders for amounts due and unpaid
on the Class B Notes for interest at the Class B Note Rate;
EIGHTH: to the Class B Noteholders, an amount sufficient to
reduce the Outstanding Amount of the Class B Notes to zero;
NINTH: to the Servicer, for any unpaid Carryover Servicing
Fees;
TENTH: to any Swap Counterparties, pro rata, the amount of any
Swap Termination Payments due to such Swap Counterparties by the Issuer and not
payable in Clause FIFTH (C);
ELEVENTH: to the Remarketing Agents, any due and unpaid
Remarketing Fees payable by the Issuer to the extent not previously paid from
amounts on deposit in the Remarketing Fee Account;
TWELFTH: sequentially, first to the Remarketing Agents, and
second to the Administrator for any advances made on behalf of the Issuer, in
each case, for payment of certain costs and expenses as set forth in Section 3
of the Remarketing Agreement in connection with the remarketing of the Reset
Rate Notes not previously reimbursed by the Issuer;
THIRTEENTH: to the Interest Rate Cap Swap Counterparty, the
amount of any termination payment due to the Interest Rate Cap Swap Counterparty
by the Issuer under the Interest Rate Cap Agreement; and
FOURTEENTH: to the Excess Distribution Certificateholder, any
remaining funds.
-29-
In the event that the related Swap Agreements have terminated,
all payments by the Trust to the Noteholders of the Reset Rate Notes then in
Foreign Exchange Mode will be made in the applicable currency utilizing the
exchange rate set forth in the related Swap Agreement prior to its termination.
If a Cross-Currency Swap Agreement terminates, amounts that
would have otherwise been paid to the related Cross-Currency Swap Counterparty
under such Cross-Currency Swap Agreement (other than amounts payable as a
Termination Payment thereunder) will be used to make payments to the Reset Rate
Notes, in an amount in Pounds Sterling or any other applicable non-U.S. Dollar
currency equal to the payment that the related Cross-Currency Swap Counterparty
would have made. If this occurs, the Trust will exchange U.S. Dollars for Pounds
Sterling or any other applicable non-U.S. Dollar currency in order to make
distributions to the Reset Rate Notes.
The Indenture Trustee may fix a record date and payment date
for any payment to Noteholders pursuant to this Section. At least 15 days before
such record date, the Indenture Trustee shall mail to each Noteholder and the
Issuer a notice that states the record date, the payment date and the amount to
be paid.
Section 5.5 Optional Preservation of the Trust Student Loans.
If the Notes have been declared to be due and payable under Section 5.2
following an Event of Default and such declaration and its consequences have not
been rescinded and annulled, the Indenture Trustee may, but need not, elect to
maintain possession of the Indenture Trust Estate. It is the desire of the
parties hereto and the Noteholders that there be at all times sufficient funds
for the payment of principal of and interest on the Notes, and the Indenture
Trustee shall take such desire into account when determining whether or not to
maintain possession of the Indenture Trust Estate. In determining whether to
maintain possession of the Indenture Trust Estate, the Indenture Trustee may,
but need not, obtain and rely upon an opinion of an Independent investment
banking or accounting firm of national reputation as to the feasibility of such
proposed action and as to the sufficiency of the Indenture Trust Estate for such
purpose.
Section 5.6 Limitation of Suits. No Noteholder shall have any
right to institute any Proceeding, judicial or otherwise, with respect to this
Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:
(i) such Noteholder has previously given written notice
to the Indenture Trustee of a continuing Event of Default;
(ii) the Noteholders of not less than 25% of the
Outstanding Amount of the Notes have made written request to the
Indenture Trustee to institute such Proceeding in respect of such Event
of Default in its own name as Indenture Trustee hereunder;
(iii) such Noteholder or Noteholders have offered to the
Indenture Trustee reasonable indemnity against the costs, expenses and
liabilities to be incurred in complying with such request;
(iv) the Indenture Trustee for 60 days after its receipt
of such notice, request and offer of indemnity has failed to institute
such Proceeding; and
-30-
(v) no direction inconsistent with such written request
has been given to the Indenture Trustee during such 60-day period by
the Noteholders of a majority of the Outstanding Amount of the Notes;
it being understood and intended that no one or more Noteholders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this indenture to affect, disturb or prejudice the rights of any other
Noteholders or to obtain or to seek to obtain priority or preference over any
other Noteholders or to enforce any right under this Indenture, except in the
manner herein provided.
In the event the Indenture Trustee shall receive conflicting
or inconsistent requests and indemnity from two or more groups of Noteholders,
each representing less than a majority of the Outstanding Amount of the Notes,
the Indenture Trustee in its sole discretion may determine what action, if any,
shall be taken, notwithstanding any other provisions of this Indenture.
Section 5.7 Unconditional Rights of Noteholders to Receive
Principal and Interest. Notwithstanding any other provisions in this Indenture,
each Noteholder shall have the right, which is absolute and unconditional, to
receive payment of the principal of and interest on its Note on or after the
respective due dates thereof expressed in such Note or in this Indenture (or, in
the case of redemption, on or after the Redemption Date) and to institute suit
for the enforcement of any such payment, and such right shall not be impaired
without the consent of such Noteholder.
Section 5.8 Restoration of Rights and Remedies. If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any
right or remedy under this Indenture and such Proceeding has been discontinued
or abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had been
instituted.
Section 5.9 Rights and Remedies Cumulative. No right or remedy
herein conferred upon or reserved to the Indenture Trustee, any Swap
Counterparty or to the Noteholders is intended to be exclusive of any other
right or remedy, and every right and remedy shall, to the extent permitted by
law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
Section 5.10 Delay or Omission Not a Waiver. No delay or
omission of the Indenture Trustee, any Swap Counterparty or any Noteholder to
exercise any right or remedy accruing upon any Default shall impair any such
right or remedy or constitute a waiver of any such Default or an acquiescence
therein. Every right and remedy given by this Article V or by law to the
Indenture Trustee, any Swap Counterparty or to the Noteholders may be exercised
-31-
from time to time, and as often as may be deemed expedient, by the Indenture
Trustee, any Swap Counterparty or by the Noteholders, as the case may be.
Section 5.11 Control by Noteholders. The Noteholders of a
majority of the Outstanding Amount of the Notes shall have the right to direct
the time, method and place of conducting any Proceeding for any remedy available
to the Indenture Trustee with respect to the Notes or exercising any trust or
power conferred on the Indenture Trustee; provided that
(i) such direction shall not be in conflict with any rule
of law or with this Indenture;
(ii) subject to the express terms of Section 5.4, any
direction to the Indenture Trustee to sell or liquidate the Indenture
Trust Estate shall be by the Noteholders of not less than 100% of the
Outstanding Amount of the Notes;
(iii) if the conditions set forth in Section 5.5 have been
satisfied and the Indenture Trustee elects to retain the Indenture
Trust Estate pursuant to such Section, then any direction to the
Indenture Trustee by Noteholders of less than 100% of the Outstanding
Amount of the Notes to sell or liquidate the Indenture Trust Estate
shall be of no force and effect; and
(iv) the Indenture Trustee may take any other action
deemed proper by the Indenture Trustee that is not inconsistent with
such direction;
provided, however, that, subject to Section 6.1, the Indenture Trustee need not
take any action that it determines might involve it in liability or might
materially adversely affect the rights of any Noteholders not consenting to such
action.
Section 5.12 Waiver of Past Defaults. Prior to the time a
judgment or decree for payment of money due has been obtained as described in
Section 5.2, the Noteholders of not less than a majority of the Outstanding
Amount of the Notes may waive any past Default and its consequences except a
Default (a) in payment when due of principal of or interest on any of the Notes
or (b) in respect of a covenant or provision hereof which cannot be modified or
amended without the consent of each Noteholder. In the case of any such waiver,
the Issuer, the Indenture Trustee and the Noteholders shall be restored to their
former positions and rights hereunder, respectively; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereto.
Upon any such waiver, such Default shall cease to exist and be
deemed to have been cured and not to have occurred for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereto.
Section 5.13 Undertaking for Costs. All parties to this
Indenture agree, and each Noteholder by such Noteholder's acceptance of any Note
shall be deemed to have agreed, that any court may in its discretion require, in
any suit for the enforcement of any right or remedy under this Indenture, or in
any suit against the Indenture Trustee for any action taken, suffered or omitted
by it as Indenture Trustee, the filing by any party litigant in such suit of an
undertaking to pay the costs of such suit, and that such court may in its
discretion assess
-32-
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to (a) any suit instituted by the Indenture Trustee, (b)
any suit instituted by any Noteholder, or group of Noteholders, in each case
holding in the aggregate more than 10% of the Outstanding Amount of the Notes or
(c) any suit Instituted by any Noteholder for the enforcement of the payment of
principal of or interest on any Note on or after the respective due dates
expressed in such Note and in this Indenture (or, in the case of redemption, on
or after the Redemption Date).
Section 5.14 Waiver of Stay or Extension Laws. The Issuer
covenants (to the extent that it may lawfully do so) that it will not at any
time insist upon, or plead or in any manner whatsoever, claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance of
this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law, and covenants that it
will not hinder, delay or impede the execution of any power herein granted to
the Indenture Trustee, but will suffer and permit the execution of every such
power as though no such law had been enacted.
Section 5.15 Action on Notes. The Indenture Trustee's right to
seek and recover judgment on the Notes or under this Indenture shall not be
affected by the seeking, obtaining or application of any other relief under or
with respect to this Indenture. Neither the lien of this Indenture nor any
rights or remedies of the Indenture Trustee or the Noteholders shall be impaired
by the recovery of any judgment by the Indenture Trustee against the Issuer or
by the levy of any execution under such judgment upon any portion of the
Indenture Trust Estate or upon any of the assets of the Issuer. Any money or
property collected by the Indenture Trustee shall be applied in accordance with
Section 5.4(b).
Section 5.16 Performance and Enforcement of Certain
Obligations. (a) Promptly following a request from the Indenture Trustee to do
so and at the Administrator's expense, the Issuer shall take all such lawful
action as the Indenture Trustee may request to compel or secure the performance
and observance by the Depositor, Xxxxxx Xxx, the Administrator and the Servicer,
as applicable, of each of their obligations to the Issuer, whether directly or
by assignment, under or in connection with the Sale Agreement, the Purchase
Agreement, the Administration Agreement and the Servicing Agreement,
respectively, in accordance with the terms thereof, and to exercise any and all
rights, remedies, powers and privileges lawfully available to the Issuer under
or in connection with the Sale Agreement, the Purchase Agreement, the
Administration Agreement and the Servicing Agreement, as the case may be, to the
extent and in the manner directed by the Indenture Trustee, including the
transmission of notices of default on the part of the Depositor, Xxxxxx Xxx, the
Administrator or the Servicer thereunder and the institution of legal or
administrative actions or proceedings to compel or secure performance by the
Depositor, Xxxxxx Mae, the Administrator or the Servicer of each of their
obligations under the Sale Agreement, the Purchase Agreement, the Administration
Agreement and the Servicing Agreement, respectively.
(b) If an Event of Default has occurred and is
continuing, the Indenture Trustee may, and at the written direction of the
Noteholders of 66-2/3% of the Outstanding Amount of the Notes shall, exercise
all rights, remedies, powers, privileges and claims of the
-33-
Issuer against the Depositor, Xxxxxx Xxx, the Administrator or the Servicer
under or in connection with the Sale Agreement, the Purchase Agreement, the
Administration Agreement and the Servicing Agreement, respectively, including
the right or power to take any action to compel or secure performance or
observance by the Depositor, Xxxxxx Mae, the Administrator or the Servicer of
each of their obligations to the Issuer thereunder, whether directly or by
assignment, and to give any consent, request, notice, direction, approval,
extension or waiver under the Sale Agreement, the Purchase Agreement, the
Administration Agreement and the Servicing Agreement, respectively, and any
right of the Issuer to take such action shall be suspended.
ARTICLE VI
THE INDENTURE TRUSTEE
Section 6.1 Duties of Indenture Trustee. (a) If an Event of
Default has occurred and is continuing, the Indenture Trustee shall exercise the
rights and powers vested in it by this Indenture and use the same degree of care
and skill in their exercise as a prudent person would exercise or use under the
circumstances in the conduct such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the Indenture Trustee undertakes to perform such
duties and only such duties as are specifically set forth in this
Indenture and no implied covenants or obligations shall be read into
this Indenture against the Indenture Trustee; and
(ii) in the absence of bad faith on its part, the
Indenture Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions expressed therein, upon
certificates or opinions furnished to the Indenture Trustee and
conforming to the requirements of this Indenture; provided, however,
that the Indenture Trustee shall examine the certificates and opinions
to determine whether or not they conform to the requirements of this
Indenture.
(c) The Indenture Trustee may not be relieved from
liability for its own negligent action, its own negligent failure to act or its
own willful misconduct, except that:
(i) this paragraph does not limit the effect of paragraph
(b) of this Section;
(ii) the Indenture Trustee shall not be liable for any
error of judgment made in good faith by a Responsible Officer unless it
is proved that the Indenture Trustee was negligent in ascertaining the
pertinent facts; and
(iii) the Indenture Trustee shall not be liable with
respect to any action it takes or omits to take in good faith in
accordance with a direction received by it pursuant to Section 5.11.
(d) The Indenture Trustee shall not be liable for interest on
any money received by it except as the Indenture Trustee may agree in writing
with the Issuer.
-34-
(e) Money held in trust by the Indenture Trustee need not
be segregated from other funds except to the extent required by law or the terms
of this Indenture or the other Basic Documents.
(f) No provision of this Indenture shall require the
Indenture Trustee to expend or risk its own funds or otherwise incur financial
liability in the performance of any of its duties hereunder or in the exercise
of any of its rights or powers, if it shall have reasonable grounds to believe
that repayments of such funds or adequate indemnity satisfactory to it against
any loss, liability or expense is not reasonably assured to it.
(g) Except as expressly provided in the Basic Documents,
the Indenture Trustee shall have no obligation to administer, service or collect
the Trust Student Loans or to maintain, monitor or otherwise supervise the
administration, servicing or collection of the Trust Student Loans.
(h) In the event that the Indenture Trustee is the Paying
Agent or the Note Registrar, the rights and protections afforded to the
Indenture Trustee pursuant to this Indenture shall also be afforded to the
Indenture Trustee in its capacity as Paying Agent or Note Registrar.
(i) Every provision of this Indenture relating to the
conduct or affecting the liability of or affording protection to the Indenture
Trustee shall be subject to the provisions of this Section and to the provisions
of the TIA.
Section 6.2 Rights of Indenture Trustee. (a) The Indenture
Trustee may rely on any document believed by it to be genuine and to have been
signed or presented by the proper Person. The Indenture Trustee need not
investigate any fact or matter stated in such document.
(b) Before the Indenture Trustee acts or refrains from
acting, it may require and shall be entitled to receive an Officers' Certificate
of the Issuer and/or an Opinion of Counsel. The Indenture Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel.
(c) The Indenture Trustee may execute any of the trusts
or powers hereunder or perform any duties hereunder either directly or by or
through agents or attorneys or a custodian or nominee, and the Indenture Trustee
shall not be responsible for any misconduct or negligence on the part of, or for
the supervision of, any such agent, attorney, custodian or nominee appointed
with due care by it hereunder.
(d) The Indenture Trustee shall not be liable for any
action it takes or omits to take in good faith which it believes to be
authorized or within its rights or powers; provided, however, that the Indenture
Trustee's conduct does not constitute willful misconduct, negligence or bad
faith.
(e) The Indenture Trustee may consult with counsel, and
the advice or opinion of counsel with respect to legal matters relating to this
Indenture and the Notes shall be full and complete authorization and protection
from liability in respect to any action taken, omitted or suffered by it
hereunder in good faith and in accordance with the advice or opinion of such
counsel.
-35-
Section 6.3 Individual Rights of Indenture Trustee. The
Indenture Trustee in its individual or any other capacity may become the owner
or pledgee of Notes and may otherwise deal with the Issuer or its Affiliates
with the same rights it would have if it were not Indenture Trustee. Any Paying
Agent, Note Registrar, co-registrar or co-paying agent may do the same with like
rights. However, the Indenture Trustee must comply with Sections 6.11 and 6.12.
Section 6.4 Indenture Trustee's Disclaimer. The Indenture
Trustee shall not be responsible for and makes no representation as to the
validity or adequacy of this Indenture or the Notes, it shall not be accountable
for the Issuer's use of the proceeds from the Notes, and it shall not be
responsible for any statement of the Issuer in the Indenture or in any document
issued in connection with the sale of the Notes or in the Notes other than the
Indenture Trustee's certificate of authentication.
Section 6.5 Notice of Defaults. If a Default occurs and is
continuing and if it is either actually known or written notice of the existence
thereof has been delivered to a Responsible Officer of the Indenture Trustee,
the Indenture Trustee shall mail notice of the Default to each Noteholder and
any Swap Counterparty within 90 days and to each Rating Agency as soon as
practicable within 30 days after it occurs. Except in the case of a Default in
payment of principal of or interest on any Note (including payments pursuant to
the mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice if and so long as a committee of its Responsible Officers in
good faith determines that withholding the notice is in the interests of
Noteholders and any Swap Counterparty. Except as provided in the first sentence
of this Section 6.5, in no event shall the Indenture Trustee be deemed to have
knowledge of a Default or an Event of Default.
Section 6.6 Reports by Indenture Trustee to Noteholders. The
Indenture Trustee shall deliver to each Noteholder (and to each Person who was a
Noteholder at any time during the applicable calendar year) such information as
may be required to enable such holder to prepare its Federal and state income
tax returns. Within 60 days after each December 31 beginning with the December
31 following the date of this Indenture, the Indenture Trustee shall mail to
each Noteholder a brief report as of such December 31 that complies with TIA
Section 313(a) if required by said section. The Indenture Trustee shall also
comply with TIA Section 313(b). A copy of each such report required pursuant to
TIA Section 313(a) or (b) shall, at the time of such transaction to Noteholders,
be filed by the Indenture Trustee with the Commission and with each securities
exchange, if any, upon which the Notes are listed, provided that the Issuer has
previously notified the Indenture Trustee of such listing.
Section 6.7 Compensation and Indemnity. The Issuer shall cause
the Depositor to pay to the Indenture Trustee reasonable compensation for its
services in accordance with a separate agreement between the Depositor and the
Indenture Trustee and shall cause the Depositor to reimburse the Indenture
Trustee for all reasonable out-of-pocket expenses incurred or made by it as
provided in such separate agreement. The Indenture Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express trust. The
Issuer shall cause the Administrator to indemnify the Indenture Trustee and its
directors, officers, employees and agents against any and all loss, liability or
expense (including attorneys' fees) incurred by it in connection with the
administration of this trust and the performance of its duties hereunder
-36-
and under the other Basic Documents. The Indenture Trustee shall notify the
Issuer and the Administrator promptly of any claim for which it may seek
indemnity. Failure by the Indenture Trustee to so notify the Issuer and the
Administrator shall not relieve the Issuer or the Administrator of its
obligations hereunder and under the other Basic Documents. The Issuer shall
cause the Administrator to defend the claim and the Administrator shall not be
liable for the legal fees and expenses of the Indenture Trustee after it has
assumed such defense; provided, however, that, in the event that there may be a
conflict between the positions of the Indenture Trustee and the Administrator in
conducting the defense of such claim, the Indenture Trustee shall be entitled to
separate counsel acceptable to it in its sole discretion the reasonable fees and
expenses of which shall be paid by the Administrator on behalf of the Issuer.
Neither the Issuer nor the Administrator need reimburse any expense or indemnify
against any loss, liability or expense incurred by the Indenture Trustee through
the Indenture Trustee's own willful misconduct, negligence or bad faith.
The Issuer's payment obligations to the Indenture Trustee
pursuant to this Section shall survive the discharge of this Indenture. When the
Indenture Trustee incurs expenses after the occurrence of a Default specified in
Section 5.1(iv) or (v) with respect to the Issuer, the expenses are intended to
constitute expenses of administration under Title 11 of the United States Code
or any other applicable Federal or state bankruptcy, insolvency or similar law.
Section 6.8 Replacement of Indenture Trustee. No resignation
or removal of the Indenture Trustee and no appointment of a successor Indenture
Trustee shall become effective until the acceptance of appointment by the
successor Indenture Trustee pursuant to this Section 6.8. The Indenture Trustee
may resign at any time by so notifying the Issuer. The Noteholders of a majority
in Outstanding Amount of the Notes may remove the Indenture Trustee by so
notifying the Indenture Trustee and may appoint a successor Indenture Trustee.
The Issuer shall remove the Indenture Trustee if:
(i) the Indenture Trustee fails to comply with Section
6.11;
(ii) an Insolvency Event occurs with respect to the
Indenture Trustee;
(iii) a receiver or other public officer takes charge of
the Indenture Trustee or its property; or
(iv) the Indenture Trustee otherwise becomes incapable of
acting.
If the Indenture Trustee resigns or is removed or if a vacancy
exists in the office of Indenture Trustee for any reason (the Indenture Trustee
in such event being referred to herein as the retiring Indenture Trustee), the
Issuer shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written
acceptance of its appointment to the retiring Indenture Trustee and to the
Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee
shall become effective, and the successor Indenture Trustee shall have all the
rights, powers and duties of the Indenture Trustee under this Indenture. The
successor Indenture Trustee shall mail a notice of its succession to
Noteholders. The retiring
-37-
Indenture Trustee shall promptly transfer all property held by it as Indenture
Trustee to the successor Indenture Trustee.
If a successor Indenture Trustee does not take office within
60 days after the retiring Indenture Trustee resigns or is removed, the retiring
Indenture Trustee, the Issuer or the Noteholders of a majority in Outstanding
Amount of the Notes may petition any court of competent jurisdiction for the
appointment of a successor Indenture Trustee. The successor Indenture Trustee
shall give notice of its appointment as successor Indenture Trustee to the
Rating Agencies.
If the Indenture Trustee fails to comply with Section 6.11,
any Noteholder may petition any court of competent jurisdiction for the removal
of the Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of the Indenture Trustee
pursuant to this Section, the Issuer's and the Administrator's obligations under
Section 6.7 shall continue for the benefit of the retiring Indenture Trustee.
Section 6.9 Successor Indenture Trustee by Merger. If the
Indenture Trustee consolidates with, merges or converts into, or transfers all
or substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Indenture Trustee,
provided that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. The Indenture Trustee shall provide
the Rating Agencies prior written notice of any such transaction.
In case at the time such successor or successors by merger,
conversion or consolidation to the Indenture Trustee shall succeed to the trusts
created by this Indenture any of the Notes shall have been authenticated but not
delivered, any such successor to the Indenture Trustee may adopt the certificate
of authentication of any predecessor trustee, and deliver such Notes so
authenticated; and in case at that time any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes either in the name of any predecessor hereunder or in the name of the
successor to the Indenture Trustee; and in all such cases such certificates
shall have the full force which it is anywhere in the Notes or in this Indenture
provided that the certificate of the Indenture Trustee shall have.
Section 6.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Indenture, at any time, for
the purpose of meeting any legal requirement of any jurisdiction in which any
part of the Indenture Trust Estate may at the time be located, the Indenture
Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee or co-trustees, or separate
trustee or separate trustees, of all or any part of the Indenture Trust Estate,
and to vest in such Person or Persons, in such capacity and for the benefit of
the Noteholders, such title to the Indenture Trust Estate, or any part hereof,
and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Indenture Trustee may consider necessary
or desirable. No such appointment shall relieve the Indenture Trustee of its
obligations hereunder. No co-trustee or separate trustee hereunder shall be
required to meet the
-38-
terms of eligibility as a successor trustee under Section 6.11 and no notice to
Noteholders of the appointment of any co-trustee or separate trustee shall be
required under Section 6.8 hereof.
(b) Every separate trustee and co-trustee shall, to the
extent permitted by law, be appointed and act subject to the following
provisions and conditions:
(i) all rights, powers, duties and obligations conferred
or imposed upon the Indenture Trustee shall be conferred or imposed
upon and exercised or performed by the Indenture Trustee and such
separate trustee or co-trustee jointly (it being understood that such
separate trustee or co-trustee is not authorized to act separately
without the Indenture Trustee joining in such act), except to the
extent that under any law of any jurisdiction in which any particular
act or acts are to be performed the Indenture Trustee shall be
incompetent or unqualified to perform such act or acts, in which event
such rights, powers, duties and obligations (including the holding of
title to the Indenture Trust Estate or any portion thereof in any such
jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Indenture
Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Indenture Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the
Indenture Trustee shall be deemed to have been given to each of the then
separate trustees and co-trustees, as effectively as if given to each of them.
Every instrument appointing any separate trustee or co-trustee shall refer to
this Indenture and the conditions of this Article VI. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Indenture Trustee or separately, as may be provided therein,
subject to all the provisions of this Indenture, specifically including every
provision of this Indenture relating to the conduct of, affecting the liability
of, or affording protection to, the Indenture Trustee. Every such instrument
shall be filed with the Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time
constitute the Indenture Trustee, its agent or attorney-in-fact with full power
and authority, to the extent not prohibited by law, to do any lawful act under
or in respect of this Indenture on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest
in and be exercised by the Indenture Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee.
Section 6.11 Eligibility; Disqualification. The Indenture
Trustee shall at all times satisfy the requirements of TIA Section 310(a), the
requirements of an "eligible lender" under 20 USC Section 1085(d) and the
requirements of Rule 3a-7(4)(i) of the General Rules and Regulations under the
Investment Company Act of 1940, as amended. The Indenture Trustee shall have a
-39-
combined capital and surplus of at least $50,000,000 as set forth in its most
recent published annual report of condition and it shall have a long-term senior
unsecured debt rating of not less than investment grade by each of the Rating
Agencies. The Indenture Trustee shall comply with TIA Section 310(b), including
the optional provision permitted by the second sentence of TIA Section
310(b)(9); provided, however, that there shall be excluded from the operation of
TIA Section 310(b)(1) any indenture or indentures under which other securities
of the Issuer are outstanding if the requirements for such exclusion set forth
in TIA Section 310(b)(1) are met.
Section 6.12 Preferential Collection of Claims Against the
Issuer. The Indenture Trustee shall comply with TIA Section 311(a), excluding
any creditor relationship listed in TIA Section 311(b). An Indenture Trustee who
has resigned or been removed shall be subject to TIA Section 311(a) to the
extent indicated.
ARTICLE VII
NOTEHOLDERS' LISTS AND REPORTS
Section 7.1 Issuer to Furnish Indenture Trustee Names and
Addresses of Noteholders. The Issuer will furnish or cause to be furnished to
the Indenture Trustee (a) not more than five days after the earlier of (i) each
Record Date and (ii) three months after the last Record Date, a list, in such
form as the Indenture Trustee may reasonably require, of the names and addresses
of the Noteholders as of such Record Date, (b) at such other times as the
Indenture Trustee may request in writing, within 30 days after receipt by the
Issuer of any such request, a list of similar form and content as of a date not
more than 10 days prior to the time such list is furnished; provided, however,
that so long as the Indenture Trustee is the Note Registrar, no such list shall
be required to be furnished.
Section 7.2 Preservation of Information; Communications to
Noteholders. The Indenture Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of the Noteholders contained in
the most recent list furnished to the Indenture Trustee as provided in Section
7.1 and the names and addresses of Noteholders received by the Indenture Trustee
in its capacity as Note Registrar. The Indenture Trustee may destroy any list
furnished to it as provided in such Section 7.1 upon receipt of a new list so
furnished.
(a) Noteholders may communicate pursuant to TIA Section
312(b) with other Noteholders with respect to their rights under this Indenture
or under the Notes. Upon receipt by the Indenture Trustee of any request by
three or more Noteholders or by one or more holders of Notes evidencing not less
than 25% of the Outstanding Amount of the Notes to receive a copy of the current
list of Noteholders (whether or not made pursuant to TIA Section 312(b)), the
Indenture Trustee shall promptly notify the Administrator thereof by providing
to the Administrator a copy of such request and a copy of the list of
Noteholders produced in response thereto.
(b) The Issuer, the Indenture Trustee and the Note
Registrar shall have the protection of TIA Section 312(c).
-40-
(c) On each Distribution Date the Indenture Trustee shall
provide to each Noteholder of record as of the related Record Date the
information provided by the Administrator to the Indenture Trustee on the
related Determination Date pursuant to Section 2.11 of the Administration
Agreement.
(d) The Indenture Trustee shall furnish to the
Noteholders promptly upon receipt of a written request therefor, duplicates or
copies of all reports, notices, requests, demands, certificates, financial
statements and any other instruments furnished to the Indenture Trustee under
the Basic Documents. The Indenture Trustee shall furnish to the Noteholders
promptly upon receipt thereof from the Eligible Lender Trustee notice of any
amendment of the Administration Agreement pursuant to Section 8.5 of the
Administration Agreement.
Section 7.3 Reports by Issuer. (a) The Issuer shall:
(i) file with the Indenture Trustee, within 15 days after
the Issuer is required to file the same with the Commission, copies of
the annual reports and of the information, documents and other reports
(or copies of such portions of any of the foregoing as the Commission
may from time to time by rules and regulations prescribe) which the
Issuer may be required to file with the Commission pursuant to Section
13 or 15(d) of the Exchange Act;
(ii) file with the Indenture Trustee and the Commission in
accordance with rules and regulations prescribed from time to time by
the Commission such additional information, documents and reports with
respect to compliance by the Issuer with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
(iii) supply to the Indenture Trustee (and the Indenture
Trustee shall transmit by mail to all Noteholders described in TIA
Section 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i) and
(ii) of this Section 7.3(a) as may be required by rules and regulations
prescribed from time to time by the Commission.
(b) Unless the Issuer otherwise determines, the fiscal
year of the Issuer shall end on December 31 of each year.
ARTICLE VIII
ACCOUNTS, DISBURSEMENTS AND RELEASES
Section 8.1 Collection of Money. Except as otherwise expressly
provided herein, the Indenture Trustee may demand payment or delivery of, and
shall receive and collect, directly and without intervention or assistance of
any fiscal agent or other intermediary, all money and other property payable to
or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture
Trustee shall apply all such money received by it on behalf of Noteholders and
any Swap Counterparty pursuant to the Administration Agreement as provided in
this Indenture. Except as otherwise expressly provided in this Indenture, if any
default occurs
-41-
in the making of any payment or performance under any agreement or instrument
that is part of the Indenture Trust Estate, the Indenture Trustee may take such
action as may be appropriate to enforce such payment or performance, including
the institution and prosecution of appropriate Proceedings. Any such action
shall be without prejudice to any right to claim a Default under this Indenture
and any right to proceed thereafter as provided in Article V.
Section 8.2 Trust Accounts. (a) On or prior to the Closing
Date, the Issuer shall cause the Administrator to establish and maintain, in the
name of the Indenture Trustee, for the benefit of the Noteholders and any Swap
Counterparty the Trust Accounts as provided in Section 2.3 of the Administration
Agreement.
(b) On or before the Business Day immediately preceding
each Distribution Date, all Available Funds with respect to the preceding
Collection Period will be deposited in the Collection Account as provided in
Section 2.4 of the Administration Agreement. On or before each Distribution
Date, the Indenture Trustee (or any other Paying Agent) shall make the required
deposits and distributions as provided in Sections 2.7 and 2.8 of the
Administration Agreement.
Section 8.3 General Provisions Regarding Accounts. (a) So long
as no Default shall have occurred and be continuing, all or a portion of the
funds in the Trust Accounts shall be invested in Eligible Investments and
reinvested by the Indenture Trustee upon Issuer Order, subject to the provisions
of Section 2.3(b) of the Administration Agreement. All income or other gain from
investments of moneys deposited in the Trust Accounts (except for the
Capitalized Interest Account, if any) shall be deposited by the Indenture
Trustee in the Collection Account, and any loss resulting from such investments
shall be charged to such Trust Account. All income or other gain from
investments of moneys deposited in the Capitalized Interest Account, if any,
shall be deposited by the Indenture Trustee in the Capitalized Interest Account,
and any loss resulting from such investments shall be charged to the Capitalized
Interest Account. The Issuer will not direct the Indenture Trustee to make any
investment of any funds or to sell any investment held in any of the Trust
Accounts unless the security interest granted and perfected in such account will
continue to be perfected in such investment or the proceeds of such sale, in
either case without any further action by any Person, and, in connection with
any direction to the Indenture Trustee to make any such investment or sale, if
requested by the Indenture Trustee, the Issuer shall deliver to the Indenture
Trustee an Opinion of Counsel, acceptable to the Indenture Trustee, to such
effect.
(b) Subject to Section 6.1(c), the Indenture Trustee
shall not in any way be held liable for the selection of Eligible Investments or
by reason of any insufficiency in any of the Trust Accounts resulting from any
loss on any Eligible Investment included therein except for losses attributable
to the Indenture Trustee's failure to make payments on such Eligible Investments
issued by the Indenture Trustee, in its commercial capacity as principal obligor
and not as trustee, in accordance with their terms.
(c) If (i) the Issuer shall have failed to give
investment directions for any funds on deposit in the Trust Accounts to the
Indenture Trustee by 10:00 a.m. Eastern Time (or such other time as may be
agreed by the Issuer and Indenture Trustee) on any Business Day; or (ii) a
Default shall have occurred and be continuing with respect to the Notes but the
Notes shall
-42-
not have been declared due and payable pursuant to Section 5.2, or, if such
Notes shall have been declared due and payable following an Event of Default,
amounts collected or receivable from the Indenture Trust Estate are being
applied in accordance with Section 5.5 as if there had not been such a
declaration; then the Indenture Trustee shall invest and reinvest funds in the
Trust Accounts in the Eligible Investments described in clause (d) of the
definition thereof.
Section 8.4 Release of Indenture Trust Estate. (a) Subject to
the payment of its fees and expenses pursuant to Section 6.7, the Indenture
Trustee may, and when required by the provisions of this Indenture shall,
execute instruments to release property from the lien of this Indenture, or
convey the Indenture Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this Indenture.
No party relying upon an instrument executed by the Indenture Trustee as
provided in this Article VIII shall be bound to ascertain the Indenture
Trustee's authority, inquire into the satisfaction of any conditions precedent
or see to the application of any moneys.
(b) The Indenture Trustee shall, at such time as there
are no Notes Outstanding and all sums due the Indenture Trustee pursuant to
Section 6.7 have been paid, subject to the interest therein of any Swap
Counterparty, release any remaining portion of the Indenture Trust Estate that
secured the Notes from the lien of this Indenture and release to the Issuer or
any other Person entitled thereto any funds then on deposit in the Trust
Accounts. The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.4(b) only upon receipt of an Issuer Request
accompanied by an Officers' Certificate of the Issuer, an Opinion of Counsel and
(if required by the TIA) Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.1.
(c) Each Noteholder, by the acceptance of a Note,
acknowledges that from time to time the Indenture Trustee shall release the lien
of this Indenture on any Trust Student Loan to be sold to (i) the Depositor in
accordance with Section 6 of the Sale Agreement, (ii) to the Servicer in
accordance with Section 3.5 of the Servicing Agreement, and (iii) to Xxxxxx Xxx
in accordance with Section 6 of the Purchase Agreement, and each Noteholder, by
the acceptance of a Note, consents to any such release.
Section 8.5 Opinion of Counsel. The Indenture Trustee shall
receive at least seven days' notice when requested by the Issuer to take any
action pursuant to Section 8.4(a), accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.4(c), as a condition to such action,
an Opinion of Counsel, in form and substance satisfactory to the Indenture
Trustee, stating the legal effect of any such action, outlining the steps
required to complete the same, and concluding that all conditions precedent to
the taking of such action have been complied with and such action will not
materially and adversely impair the security for the Notes or the rights of the
Noteholders or any Swap Counterparty in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall not be required
to express an opinion as to the fair value of the Indenture Trust Estate.
Counsel rendering any such opinion may rely, without independent investigation,
on the accuracy and validity of any certificate or other instrument delivered to
the Indenture Trustee in connection with any such action.
-43-
ARTICLE IX
SUPPLEMENTAL INDENTURES
Section 9.1 Supplemental Indentures Without Consent of
Noteholders. Without the consent of any Noteholders but with prior notice to the
Rating Agencies, the Issuer and the Indenture Trustee, when authorized by an
Issuer Order, at any time and from time to time, may enter into one or more
indentures supplemental hereto (which shall conform to the provisions of the
Trust Indenture Act as in force at the date of the execution thereof), in form
satisfactory to the Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property
at any time subject to the lien of this Indenture, or better to assure,
convey and confirm unto the Indenture Trustee any property subject or
required to be subjected to the lien of this Indenture, or to subject
to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with the
applicable provisions hereof, of another person to the Issuer, and the
assumption by any such successor of the covenants of the Issuer herein
and in the Notes contained;
(iii) to add to the covenants of the Issuer, for the
benefit of the Noteholders and, any Swap Counterparty, as applicable,
or to surrender any right or power herein conferred upon the Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any
property to the Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any
provision herein or in any supplemental indenture which may be
inconsistent with any other provision herein or in any supplemental
indenture or to make any other provisions with respect to matters or
questions arising under this Indenture or in any supplemental
indenture; provided that such action shall not materially adversely
affect the interests of the Noteholders or any Swap Counterparty;
(vi) to evidence and provide for the acceptance of the
appointment hereunder by a successor trustee with respect to the Notes
and to add to or change any of the provisions of this Indenture as
shall be necessary to facilitate the administration of the trusts
hereunder by more than one trustee, pursuant to the requirements of
Article VI; or
(vii) to modify, eliminate or add to the provisions of this
Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the TIA or under any similar
Federal statute hereafter enacted and to add to this Indenture such
other provisions as may be expressly required by the TIA.
The Indenture Trustee is hereby authorized to join in the
execution of any such supplemental indenture and to make any further appropriate
agreements and stipulations that may be therein contained.
-44-
(b) The Issuer and the Indenture Trustee, when authorized
by an Issuer Order, may, also without the consent of any of the Noteholders but
with prior notice to any Swap Counterparty and the Rating Agencies, enter into
an indenture or indentures supplemental hereto for the purpose of adding any
provisions to, or changing in any manner or eliminating any of the provisions
of, this Indenture or of modifying in any manner the rights of the Noteholders
or any Swap Counterparty under this Indenture; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder or any Swap Counterparty.
Section 9.2 Supplemental Indentures with Consent of
Noteholders. The Issuer and the Indenture Trustee, when authorized by an Issuer
Order, also may, with prior notice to any Swap Counterparty and the Rating
Agencies and with the consent of the Noteholders of not less than a majority of
the Outstanding Amount of the Notes, by Act of such Noteholders delivered to the
Issuer and the Indenture Trustee, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders under this Indenture;
provided, however, that no such supplemental indenture shall, without the
consent of the Noteholder of each Outstanding Note affected thereby:
(i) change the date of payment of any installment of
principal of or interest on any Note, or reduce the principal amount
thereof, the interest rate thereon or the Redemption Price with respect
thereto, change the provisions of this Indenture relating to the
application of collections on, or the proceeds of the sale of, the
Indenture Trust Estate to payment of principal of or interest on the
Notes, or change any place of payment where, or the coin or currency in
which, any Note or the interest thereon is payable (other than pursuant
to the terms and conditions of the Reset Rate Notes or pursuant to the
Reset Rate Note Procedures set forth in Appendix A-2 to this Indenture)
or impair the right to institute suit for the enforcement of the
provisions of this Indenture requiring the application of funds
available therefor, as provided in Article V, to the payment of any
such amount due on the Notes on or after the respective due dates
thereof (or, in the case of redemption, on or after the Redemption
Date);
(ii) reduce the percentage of the Outstanding Amount of
the Notes, the consent of the Noteholders of which is required for any
such supplemental indenture, or the consent of the Noteholders of which
is required for any waiver of compliance with certain provisions of
this Indenture or certain defaults hereunder and their consequences
provided for in this Indenture;
(iii) modify or alter the provisions of the proviso to the
definition of the term "Outstanding";
(iv) reduce the percentage of the Outstanding Amount of
the Notes required to direct the Indenture Trustee to direct the Issuer
to sell or liquidate the Indenture Trust Estate pursuant to Section
5.4;
(v) modify any provision of this Section except to
increase any percentage specified herein or to provide that certain
additional provisions of this Indenture or the
-45-
other Basic Documents cannot be modified or waived without the consent
of the Noteholder of each Outstanding Note affected thereby;
(vi) modify any of the provisions of this Indenture in
such manner as to affect the calculation of the amount of any payment
of interest or principal due on any Note on any Distribution Date
(including the calculation of any of the individual components of such
calculation) or to affect the rights of the Noteholders to the benefit
of any provisions for the mandatory redemption of the Notes contained
herein; or
(vii) permit the creation of any lien ranking prior to or
on a parity with the lien of this Indenture with respect to any part of
the Indenture Trust Estate or, except as otherwise permitted or
contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive any Noteholder of any
Note of the security provided by the lien of this Indenture.
It shall not be necessary for any Act of Noteholders under
this Section to approve the particular form of any proposed supplemental
indenture, but it shall be sufficient if such Act shall approve the substance
thereof.
Promptly after the execution by the Issuer and the Indenture
Trustee of any supplemental indenture pursuant to this Section, the Indenture
Trustee shall mail to the Noteholders of the Notes to which such amendment or
supplemental indenture relates a notice setting forth in general terms the
substance of such supplemental indenture. Any failure of the Indenture Trustee
to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
Section 9.3 Execution of Supplemental Indentures. In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Indenture Trustee shall be entitled to
receive, and subject to Sections 6.1 and 6.2, shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture. The
Indenture Trustee may, but shall not be obligated to, enter into any such
supplemental indenture that affects the Indenture Trustee's own rights, duties,
liabilities or immunities under this Indenture or otherwise.
Section 9.4 Effect of Supplemental Indenture. Upon the
execution of any supplemental indenture pursuant to the provisions hereof, this
Indenture shall be and be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective rights,
limitations of rights, obligations, duties, liabilities and immunities under
this Indenture of the Indenture Trustee, the Issuer and the Noteholders shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
Section 9.5 Conformity with Trust Indenture Act. Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article IX shall conform to
-46-
the requirements of the Trust Indenture Act as then in effect so long as this
Indenture shall then be qualified under the Trust Indenture Act.
Section 9.6 Reference in Notes to Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to this Article IX may, and if required by the Indenture
Trustee shall, bear a notation in form approved by the Indenture Trustee as to
any matter provided for in such supplemental indenture. If the Issuer or the
Indenture Trustee shall so determine, new Notes so modified as to conform, in
the opinion of the Indenture Trustee and the Issuer, to any such supplemental
indenture may be prepared and executed by the Issuer and authenticated and
delivered by the Indenture Trustee in exchange for Outstanding Notes.
ARTICLE X
REDEMPTION OF NOTES
Section 10.1 Redemption. The Indenture Trustee shall, upon
receipt of written notice from the Servicer pursuant to Section 6.1(b) of the
Administration Agreement, give prompt written notice to the Noteholders of the
occurrence of such event. In the event that the assets of the Trust are sold
pursuant to Section 6.1(a) of the Administration Agreement, that portion of the
amounts on deposit in the Trust Accounts to be distributed to the Noteholders
shall be paid to the Noteholders as provided in Sections 2.7 and 2.8. If amounts
are to be paid to Noteholders pursuant to this Section 10.1, the notice of such
event from the Indenture Trustee to the Noteholders shall include notice of the
redemption of Notes by application of such amounts on the next Distribution Date
which is not sooner than 15 days after the date of such notice (the "Redemption
Date"), whereupon all such amounts shall be payable on the Redemption Date.
Section 10.2 Form of Redemption Notice. Notice of redemption
under Section 10.1 shall be given by the Indenture Trustee by first-class mail,
postage prepaid, or by facsimile, mailed or transmitted on or prior to the
applicable Redemption Date to each Noteholder, as of the close of business on
the Record Date preceding the applicable Redemption Date, at such Noteholder's
address or facsimile number appearing in the Note Register.
All notices of redemption shall state:
(i) the Redemption Date;
(ii) the Redemption Price; and
(iii) the place where such Notes are to be surrendered for
payment of the Redemption Price (which shall be the office or agency of
the Issuer to be maintained as provided in Section 3.2).
Notice of redemption of the Notes shall be given by the
Indenture Trustee in the name and at the expense of the Issuer. Failure to give
notice of redemption, or any defect therein, to any Noteholder of any Note shall
not impair or affect the validity of the redemption of any other Note.
-47-
Section 10.3 Notes Payable on Redemption Date. The Notes or
portions thereof to be redeemed shall on the Redemption Date become due and
payable at the Redemption Price and (unless the Issuer shall default in the
payment of the Redemption Price) no interest shall accrue on the Redemption
Price for any period after the date to which accrued interest is calculated for
purposes of calculating the Redemption Price.
ARTICLE XI
MISCELLANEOUS
Section 11.1 Compliance Certificates and Opinions, etc. (a)
Upon any application or request by the Issuer to the Indenture Trustee to take
any action under any provision of this Indenture, the Issuer shall furnish to
the Indenture Trustee and the Rating Agencies (i) an Officers' Certificate of
the Issuer stating that all conditions precedent, if any, provided for in this
Indenture relating to the proposed action have been complied with, (ii) an
Opinion of Counsel stating that in the opinion of such counsel all such
conditions precedent, if any, have been complied with and (iii) (if required by
the TIA) an Independent Certificate from a firm of certified public accountants
meeting the applicable requirements of this Section, except that, in the case of
any such application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture, no additional
certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this indenture shall include:
(i) a statement that each signatory of such certificate
or opinion has read or has caused to be read such covenant or condition
and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such
signatory, such signatory has made such examination or investigation as
is necessary to enable such signatory to express an informed opinion as
to whether or not such covenant or condition has been complied with;
and
(iv) a statement as to whether, in the opinion of each
such signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other
property or securities with the Indenture Trustee that is to be made the basis
for the release of any property or securities subject to the lien of this
Indenture, the Issuer shall, in addition to any obligation imposed in Section
11.1(a) or elsewhere in this Indenture, furnish to the Indenture Trustee and the
Rating Agencies an Officers' Certificate of the Issuer certifying or stating the
opinion of each person
-48-
signing such certificate as to the fair value (within 90 days of such deposit)
to the Issuer of the Collateral or other property or securities to be so
deposited.
(ii) Whenever the Issuer is required to furnish to the
Indenture Trustee and the Rating Agencies an Officers' Certificate of
the Issuer certifying or stating the opinion of any signer thereof as
to the matters described in clause (i) above, the Issuer shall also
deliver to the Indenture Trustee an Independent Certificate as to the
same matters, if the fair value to the Issuer of the securities to be
so deposited and of all other such securities made the basis of any
such withdrawal or release since the commencement of the then-current
fiscal year of the Issuer, as set forth in the certificates delivered
pursuant to clause (i) above and this clause (ii), is 10% or more of
the Outstanding Amount of the Notes, but such a certificate need not be
furnished with respect to any securities so deposited, if the fair
value thereof to the Issuer as set forth in the related Officers'
Certificate is less than $25,000 or less than one percent of the
Outstanding Amount of the Notes.
(iii) Other than any property released as contemplated by
clause (v) below, whenever any property or securities are to be
released from the lien of this Indenture, the Issuer shall also furnish
to the Indenture Trustee an Officers' Certificate of the Issuer
certifying or stating the opinion of each person signing such
certificate as to the fair value (within 90 days of such release) of
the property or securities proposed to be released and stating that in
the opinion of such person the proposed release will not impair the
security under this Indenture in contravention of the provisions
hereof.
(iv) Whenever the Issuer is required to furnish to the
Indenture Trustee an Officers' Certificate of the Issuer certifying or
stating the opinion of any signer thereof as to the matters described
in clause (iii) above, the Issuer shall also furnish to the Indenture
Trustee an Independent Certificate as to the same matters if the fair
value of the property or securities and of all other property, other
than property as contemplated by clause (v) below, or securities
released from the lien of this Indenture since the commencement of the
then-current calendar year, as set forth in the certificates required
by clause (iii) above and this clause (iv), equals 10% or more of the
Outstanding Amount of the Notes, but such certificate need not be
furnished in the case of any release of property or securities if the
fair value thereof as set forth in the related Officers' Certificate is
less than $25,000 or less than one percent of the then Outstanding
Amount of the Notes.
(v) Notwithstanding Section 2.9 or any other provision of
this Section, the Issuer may, without compliance with the requirements
of the other provisions of this Section, (A) collect, liquidate, sell
or otherwise dispose of Trust Student Loans as and to the extent
permitted or required by the Basic Documents, (B) make cash payments
out of the Trust Accounts as and to the extent permitted or required by
the Basic Documents and (C) convey to the Depositor, the Servicer or
another eligible lender those specified Trust Student Loans as and to
the extent permitted or required by and in accordance with Section
8.4(c) hereof and Section 6 of the Sale Agreement, Section 3.5 of the
Servicing Agreement or Section 3.11E of the Servicing Agreement,
respectively, so long as the Issuer shall deliver to the Indenture
Trustee every six months, commencing December 31, 2004, an Officers'
Certificate of the Issuer stating that all the dispositions of
Collateral
-49-
described in clauses (A), (B) or (C) above that occurred during the
immediately preceding six calendar months were in the ordinary course
of the Issuer's business and that the proceeds thereof were applied in
accordance with the Basic Documents.
Section 11.2 Form of Documents Delivered to Indenture Trustee.
In any case where several matters are required to be certified by, or covered by
an opinion of, any specified Person, it is not necessary that all such matters
be certified by, or covered by the opinion of, only one such Person, or that
they be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters, and one or more other
such Persons as to other matters, and any such Person may certify or give an
opinion as to such matters in one or several documents.
Any certificate or opinion of an Authorized Officer of the
Issuer may be based, insofar as it relates to legal matters, upon a certificate
or opinion of, or representations by, counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate of an Authorized Officer or
Opinion of Counsel may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer, the Depositor, the Issuer or the Administrator, stating that the
information with respect to such factual matters is in the possession of the
Servicer, the Depositor, the Issuer or the Administrator, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two or
more applications, requests, consents, certificates, statements, opinions or
other instruments under this Indenture, they may, but need not, be consolidated
and form one instrument.
Whenever in this Indenture, in connection with any application
or certificate or report to the Indenture Trustee, it is provided that the
Issuer shall deliver any document as a condition of the granting of such
application, or as evidence of the Issuer's compliance with any term hereof, it
is intended that the truth and accuracy, at the time of the granting of such
application or at the effective date of such certificate or report (as the case
may be), of the facts and opinions stated in such document shall in such case be
conditions precedent to the right of the Issuer to have such application granted
or to the sufficiency of such certificate or report. The foregoing shall not,
however, be construed to affect the Indenture Trustee's right to rely upon the
truth and accuracy of any statement or opinion contained in any such document as
provided in Article VI.
Section 11.3 Acts of Noteholders. (a) Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agents duly appointed in writing; and except as
herein otherwise expressly provided such action shall become effective when such
instrument or instruments are delivered to the Indenture Trustee, and, where it
is hereby expressly required, to the Issuer. Such instrument or instruments (and
the action embodied therein and evidenced thereby) are herein sometimes referred
to as the "Act" of the Noteholders
-50-
signing such instrument or instruments. Proof of execution of any such
instrument or of a writing appointing any such agent shall be sufficient for any
purpose of this Indenture and (subject to Section 6.1) conclusive in favor of
the Indenture Trustee and the Issuer, if made in the manner provided in this
Section.
(b) The fact and date of the execution by any person of
any such instrument or writing may be proved in any manner that the Indenture
Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note
Register.
(d) Any request, demand, authorization, direction,
notice, consent, waiver or other action by any Noteholder shall bind the
Noteholder of every Note issued upon registration of transfer thereof or in
exchange therefor or in lieu thereof, in respect of anything done, omitted or
suffered to be done by the Indenture Trustee or the Issuer in reliance thereon,
whether or not notation of such action is made upon such Note.
Section 11.4 Notices, etc. , to Indenture Trustee, Issuer and
Rating Agencies. Any request, demand, authorization, direction, notice, consent,
waiver or Act of Noteholders or other documents provided or permitted by this
Indenture shall be in writing and if such request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders is to be made upon,
given or furnished to or filed with:
(a) The Indenture Trustee by any Noteholder, the
Servicer, the Administrator or by the Issuer shall be sufficient for every
purpose hereunder if made, given, furnished or filed in writing to or with the
Indenture Trustee at its Corporate Trust Office with a copy to: The Bank of New
York, 0 Xxxxx XxXxxxx Xx., Xxxxx 0000, Xxxxxxx, Xxxxxxxx, 00000, Attention:
Corporate Trust - Structured Finance.
(b) The Issuer by the Indenture Trustee or by any
Noteholder shall be sufficient for every purpose hereunder if in writing and
mailed, first-class, postage prepaid, to the Issuer addressed to: SLM Student
Loan Trust 2003-12, in care of Chase Manhattan Bank USA, National Association,
Christiana Center/OPS4, 000 Xxxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx 00000,
Attention: Corporate Trust Department; with copies to JPMorgan Chase Bank, 000
Xxxx 00xx Xxxxxx 00xx Xx., Xxx Xxxx, Xxx Xxxx 00000, Attention: Structured
Finance Services; and the Administrator, 00000 Xxxxxx Xxx Xxxxx, Xxxxxx,
Xxxxxxxx 00000, Attention: ABS Trust Administration, or any other address
previously furnished in writing to the Indenture Trustee by the Issuer or the
Administrator. The Issuer shall promptly transmit any notice received by it from
the Noteholders to the Indenture Trustee.
Notices required to be given to the Rating Agencies by the
Issuer, the Indenture Trustee or the Eligible Lender Trustee shall be in
writing, personally delivered or mailed by certified mail, return receipt
requested, to (i) in the case of Moody's, at the following address: ABS
Monitoring Department, 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, (ii) in the
case of S&P, at the following address: 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000-0000, Attention: Asset Backed Surveillance Department, 32nd Floor, and
(iii) in the case of Fitch, at the following address: Xxx Xxxxx Xxxxxx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Municipal Structured
-51-
Finance Group; or as to each of the foregoing, at such other address as shall be
designated by written notice to the other parties.
Notices to any Swap Counterparty will be sent to the addresses
set forth in the related Swap Agreement or the Interest Rate Cap Agreement,
respectively or such other addresses as may be designated by written notice to
the parties to this Indenture.
Section 11.5 Notices to Noteholders; Waiver. Where this
Indenture provides for notice to Noteholders of any event, such notice shall be
sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class, postage prepaid to each Noteholder affected by such
event, at his address as it appears on the Note Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Noteholders is given by mail,
neither the failure to mail such notice nor any defect in any notice so mailed
to any particular Noteholder shall affect the sufficiency of such notice with
respect to other Noteholders, and any notice that is mailed in the manner herein
provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such
notice may be waived in writing by any Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Noteholders shall be filed with the Indenture
Trustee but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such a waiver.
In case, by reason of the suspension of regular mail service
as a result of a strike, work stoppage or similar activity, it shall be
impractical to mail notice of any event to Noteholders when such notice is
required to be given pursuant to any provision of this Indenture, then any
manner of giving such notice as shall be satisfactory to the Indenture Trustee
shall be deemed to be a sufficient giving of such notice.
Where this Indenture provides for notice to the Rating
Agencies, failure to give such notice shall not affect any other rights or
obligations created hereunder, and shall not under any circumstance constitute a
Default.
Section 11.6 Alternate Payment and Notice Provisions.
Notwithstanding any provision of this Indenture or any of the Notes to the
contrary, the Issuer may enter into any agreement with any Noteholder providing
for a method of payment, or notice by the Indenture Trustee or any Paying Agent
to such Noteholder, that is different from the methods provided for in this
Indenture for such payments or notices. The Issuer will furnish to the Indenture
Trustee a copy of each such agreement and the Indenture Trustee will cause
payments to be made and notices to be given in accordance with such agreements.
Section 11.7 Conflict with Trust Indenture Act. If any
provision hereof limits, qualifies or conflicts with another provision hereof
that is required to be included in this Indenture by any of the provisions of
the Trust Indenture Act, such required provision shall control.
The provisions of TIA Sections 310 through 317 that impose
duties on any Person (including the provisions automatically deemed included
herein unless expressly excluded by
-52-
this Indenture) are a part of and govern this Indenture, whether or not
physically contained herein.
Section 11.8 Effect of Headings and Table of Contents. The
Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
Section 11.9 Successors and Assigns. All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successor and assigns, whether so expressed or not. All agreements of the
Indenture Trustee in this Indenture shall bind the successors, co-trustees and
agents (excluding any legal representatives or accountants) of the Indenture
Trustee.
Section 11.10 Separability. In case any provision in this
Indenture or in the Notes shall be invalid, illegal or unenforceable, the
validity, legality, and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
Section 11.11 Benefits of Indenture. (a) Except as set forth
in paragraphs (b) and (c) below, nothing in this Indenture or in the Notes,
express or implied shall give to any person, other than the parties hereto and
their successors hereunder, the Noteholders, any other party secured hereunder,
and any other Person with an ownership interest in any part of the Indenture
Trust Estate, any benefit or any legal or equitable right, remedy or claim under
this Indenture.
(b) The parties to this Indenture acknowledge and agree
that each Swap Counterparty is an intended third party beneficiary of this
Indenture to the extent of its rights hereunder and under the related Swap
Agreement entered into by the Issuer from time to time and shall be entitled to
enforce such rights.
(c) The parties to this Indenture acknowledge and agree
that SLM Corporation, and any permitted transferee, if applicable, is an
intended third party beneficiary of this Indenture to the extent of its rights
with respect to the Call Option as set forth in Section 7 of Appendix A-2 hereto
and shall be entitled to enforce such rights.
Section 11.12 Legal Holidays. In any case where the date on
which any payment is due shall not be a Business Day, then (notwithstanding any
other provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.
Section 11.13 GOVERNING LAW. This Indenture shall be construed
in accordance with the laws of the State of New York, without reference to its
conflict of law provisions (other than Section 5-1401 of the New York General
Obligations Law), and the obligations, rights and remedies of the parties
hereunder shall be determined in accordance with such laws.
Section 11.14 Counterparts. This Indenture may be executed in
any number of counterparts, each of which so executed shall be deemed to be an
original, but all such counterparts shall together constitute but one and the
same instrument.
-53-
Section 11.15 Recording of Indenture. If this Indenture is
subject to recording in any appropriate public recording offices, such recording
is to be effected by the Issuer and at its expense accompanied by an Opinion of
Counsel (which may be counsel to the Indenture Trustee or any other counsel
reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any other
Person secured hereunder or for the enforcement of any right or remedy granted
to the Indenture Trustee under this Indenture.
Section 11.16 Trust Obligations. No recourse may be taken,
directly or indirectly, with respect to the obligations of the Issuer, the
Depositor, the Administrator, the Servicer, the Eligible Lender Trustee or the
Indenture Trustee on the Notes or under this Indenture or any certificate or
other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Eligible Lender Trustee in its individual capacity,
(ii) any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Indenture
Trustee or the Eligible Lender Trustee in its individual capacity, any holder or
owner of a beneficial interest in the Issuer, the Eligible Lender Trustee or the
Indenture Trustee or of any successor or assign thereof in its individual
capacity, except as any such Person may have expressly agreed (it being
understood that the Indenture Trustee and the Eligible Lender Trustee have no
such obligations in their individual capacity) and except that any such partner,
owner or beneficiary shall be fully liable, to the extent provided by applicable
law, for any unpaid consideration for stock, unpaid capital contribution or
failure to pay any installment or call owing to such entity. For all purposes of
this Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Eligible Lender Trustee shall be subject to, and entitled to the
benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust
Agreement.
Section 11.17 No Petition. The Indenture Trustee, by entering
into this Indenture, and each Noteholder, by accepting a Note, hereby covenant
and agree that they shall not at any time institute against the Depositor or the
Issuer, or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency, receivership or liquidation
proceedings, or other proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Notes, this Indenture or any of the other Basic Documents. The foregoing shall
not limit the rights of the Indenture Trustee to file any claim in, or otherwise
take any action with respect to, any insolvency proceeding that was instituted
against the Issuer by any Person other than the Indenture Trustee.
Section 11.18 Inspection. The Issuer agrees that, on
reasonable prior notice, it shall permit any representative of the Indenture
Trustee, during the Issuer's normal business hours, to examine all the books of
account, records, reports, and other papers of the Issuer, to make copies and
extracts therefrom, to cause such books to be audited by Independent certified
public accountants, and to discuss the Issuer's affairs, finances and accounts
with the Issuer's officers, employees, and Independent certified public
accountants, all at such reasonable times and as often as may be reasonably
requested. The Indenture Trustee shall and shall cause its representatives to
hold in confidence all such information obtained from such examination or
inspection except to the extent disclosure may be required by law (and all
reasonable applications for confidential treatment are unavailing) and except to
the extent that the Indenture
-54-
Trustee may reasonably determine that such disclosure is consistent with its
obligations hereunder.
Section 11.19 Subordination. All rights and interest of each
Cross-Currency Swap Counterparty in the security interest granted to the
Indenture Trustee under this Indenture shall be fully subordinated to the
interests of the Noteholders. No Cross-Currency Swap Counterparty shall have any
rights, implied or otherwise, in the Collateral until after the Outstanding
Amount of the Notes has been reduced to zero and the Noteholders have been paid
all amounts owed to them under this Indenture. Notwithstanding the foregoing,
the provisions of this Section 11.19 shall not modify or otherwise affect the
contractual priority of payments set forth in Section 5.4(b) hereof or Section
2.8 of the Administration Agreement. More specifically, no Cross-Currency Swap
Counterparty shall have any voting rights or rights to exercise any remedies
under this Indenture until after the Outstanding Amount of the Notes has been
reduced to zero and the Noteholders have been paid all amounts owed to them
under this Indenture. After the Outstanding Amount of the Notes has been reduced
to zero and the Noteholders have been paid all amounts owed to them under this
Indenture, each Cross-Currency Swap Counterparty shall have all of the rights
and obligations, including all voting rights, of the Noteholders set forth in
this Indenture.
-55-
IN WITNESS WHEREOF, the Issuer, the Eligible Lender Trustee
and the Indenture Trustee have caused this Indenture to be duly executed by
their respective officers, thereunto duly authorized and duly attested, all as
of the day and year first above written.
SLM STUDENT LOAN TRUST 2003-12
By: CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, not in its individual
capacity but solely as Eligible
Lender Trustee
By: /s/ XXXX X. XXXXXX
-----------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION, not
in its individual capacity but
solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
-----------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
THE BANK OF NEW YORK, not in its
individual capacity but solely as
Indenture Trustee
By: /s/ XXXX X. XXXXXXX
-----------------------------------
Name: Xxxx X. Xxxxxxx
Title: Agent
ACCEPTED AND AGREED TO WITH RESPECT TO THE TRANSFER OF ALL RIGHT, TITLE AND
INTEREST IN AND TO THE CALL OPTION CONTAINED IN, AND SUBJECT TO THE TERMS AND
CONDITIONS SET FORTH IN, SECTION 7 OF APPENDIX A-2 TO THIS INDENTURE
SLM FUNDING LLC
By: /s/ XXXX X. XXXXXX
----------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
SLM CORPORATION
By: /s/ J. XXXXX XXXXXX
----------------------------
Name: J. Xxxxx Xxxxxx
Title: Authorized Agent
APPENDIX A-1
DEFINITIONS AND USAGE
Series 2003-12
Usage
The following rules of construction and usage shall be
applicable to any instrument that is governed by this appendix (this
"Appendix"):
(a) All terms defined in this Appendix shall have the defined
meanings when used in any instrument governed hereby and in any
certificate or other document made or delivered pursuant thereto unless
otherwise defined therein.
(b) As used herein, in any instrument governed hereby and
in any certificate or other document made or delivered pursuant
thereto, accounting terms not defined in this Appendix or in any such
instrument, certificate or other document, and accounting terms partly
defined in this Appendix or in any such instrument, certificate or
other document, to the extent not defined, shall have the respective
meanings given to them under generally accepted accounting principles
as in effect on the date of such instrument. To the extent that the
definitions of accounting terms in this Appendix or in any such
instrument, certificate or other document are inconsistent with the
meanings of such terms under generally accepted accounting principles,
the definitions contained in this Appendix or in any such instrument,
certificate or other document shall control.
(c) The words "hereof," "herein," "hereunder" and words
of similar import when used in an instrument refer to such instrument
as a whole and not to any particular provision or subdivision thereof;
references in an instrument to "Article," "Section" or another
subdivision or to an attachment are, unless the context otherwise
requires, to an article, section or subdivision of or an attachment to
such instrument; and the term "including" means "including without
limitation."
(d) The definitions contained in this Appendix are
equally applicable to both the singular and plural forms of such terms
and to the masculine as well as to the feminine and neuter genders of
such terms.
(e) Any agreement, instrument or statute defined or
referred to below or 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 assignment, assumption, waiver or
consent and (in the case of statutes) by succession of comparable
successor statutes and includes (in the case of agreements or
instruments) references to all attachments thereto and instruments
incorporated therein. References to a Person are also to its permitted
successors and assigns.
Appendix A-1-1
Definitions
"30/360" means that interest is calculated on the basis of a
360-day year consisting of twelve 30-day months.
"91-day Treasury Xxxx Rate" means, for any relevant Interest
Rate Determination Date, prior to each Interest Rate Change Date, the rate equal
to the weighted average per annum discount rate (expressed as a bond equivalent
yield and applied on a daily basis) for direct obligations of the United States
with a maturity of thirteen weeks ("91-day Treasury Bills") sold at the
applicable 91-day Treasury Xxxx auction, as published in H.15(519) or otherwise
or as reported by the U.S. Department of the Treasury. In the event that the
results of the auctions of 91-day Treasury Bills cease to be published or
reported as provided above, or that no 91-day Treasury Xxxx auction is held in a
particular week, then the 91-day Treasury Xxxx Rate in effect as a result of the
last such publication or report will remain in effect until such time, if any,
as the results of auctions of 91-day Treasury Bills will again be so published
or reported or such auction is held, as the case may be. The 91-day Treasury
Xxxx Rate will be subject to a Lock-In Period of six Business Days.
"Accrual Period" means, with respect to a Distribution Date
and (i) each class of Notes bearing a floating rate of interest (including,
without limitation, the Floating Rate Notes), the period from and including the
immediately preceding Distribution Date for such class of Notes to but excluding
the then-current Distribution Date, or in the case of the initial such period
for the Floating Rate Notes, the period from and including the Closing Date to
and including March 14, 2004; provided that if more than one Interest Rate
Change Date occurs for the Reset Rate Notes bearing a floating rate of interest
within any given Accrual Period, the rate of interest for the entire Accrual
Period shall be as specified in the relevant Remarketing Terms Notice; and (ii)
the Reset Rate Notes if they then bear a fixed rate of interest and (x) are
denominated in U.S. Dollars, the period from and including the 15th day of the
month of the immediately preceding Distribution Date, to and including the 14th
day of the month of the then-current Distribution Date for the Reset Rate Notes,
or (y) are denominated in a currency other than U.S. Dollars (including during
the initial Reset Period), (A) the period from and including the 15th day of the
month of the immediately preceding Distribution Date, to and including the 14th
day of the month of the then-current Distribution Date or (B) as otherwise
specified on the Schedule A for the Reset Rate Notes; provided, however, that
the initial Accrual Period for the Reset Rate Notes will begin on the Closing
Date and end on September 14, 2004.
"Accumulation Account" means the account designated as such,
established and maintained pursuant to Section 2.3(j) of the Administration
Agreement.
"Act" means the Securities Act of 1933, as amended.
"Actual/360" means that interest is calculated on the basis of
the actual number of days elapsed in a year of 360 days.
"Actual/365 (fixed)" means that interest is calculated on the
basis of the actual number of days elapsed in a year of 365 days, regardless of
whether accrual or payment occurs in a leap year.
Appendix A-1-2
"Actual/Actual (accrual basis)" means that interest is
calculated on the basis of the actual number of days elapsed in a year of 365
days, or 366 days for every day in a leap year.
"Actual/Actual (ISMA)" means a calculation in accordance with
the definition of "Actual/Actual" adopted by the International Securities Market
Association ("ISMA"), which means that interest is calculated on the following
basis:
(i) where the number of days in the relevant
Accrual Period is equal to or shorter than the Determination
Period during which such Accrual Period ends, the number of
days in such Accrual Period divided by the product of (A) the
number of days in such Determination Period and (B) the number
of Distribution Dates that would occur in one calendar year;
or
(ii) where the Accrual Period is longer than the
Determination Period during which the Accrual Period ends, the
sum of:
(A) the number of days in such Accrual
Period falling in the Determination Period in which
the Accrual Period begins divided by the product of
(x) the number of days in such Determination Period
and (y) the number of Distribution Dates that would
occur in one calendar year; and
(B) the number of days in such Accrual
Period falling in the next Determination Period
divided by the product of (x) the number of days in
such Determination Period and (y) the number of
Distribution Dates that would occur in one calendar
year;
where "Determination Period" means the period from and including one Calculation
Date to but excluding the next Calculation Date and "Calculation Date" means, in
each year, each of those days in the calendar year that are specified herein as
being the scheduled Distribution Dates; provided, however, that the first
Determination Period for each of the Reset Rate Notes is 295 days.
"Actual/Actual (payment basis)" means that interest is
calculated on the basis of the actual number of days elapsed in a year of 365
days if the interest period ends in a non-leap year, or 366 days if the interest
period ends in a leap year, as the case may be.
"Adjusted Pool Balance" means, for any Distribution Date, (a)
if the Pool Balance as of the last day of the related Collection Period is
greater than 40% of the Initial Pool Balance, the sum of that Pool Balance and
the Specified Reserve Account Balance for that Distribution Date or (b) if the
Pool Balance as of the last day of the related Collection Period is less than or
equal to 40% of the Initial Pool Balance, that Pool Balance.
"Administration Agreement" means the Master Administration
Agreement dated as of May 1, 1997, between Xxxxxx Mae and the Depositor and the
Supplement, and as such agreement may be further amended or supplemented from
time to time.
Appendix A-1-3
"Administration Fee" has the meaning specified in Section 2.14
of the Administration Agreement.
"Administrator" means Xxxxxx Xxx, in its capacity as
administrator of the Trust in accordance with the Administration Agreement.
"Administrator Default" has the meaning specified in Section
5.1 of the Administration Agreement.
"Administrator's Certificate" means an Officers' Certificate
of the Administrator delivered pursuant to Section 3.1(c) of the Administration
Agreement.
"Affiliate" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used with
respect to any specified Person means the power to direct the management and
policies of such Person, directly or indirectly, whether through the ownership
of voting securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"All Hold Rate" means, for the Reset Rate Notes when they are
denominated in U.S. Dollars during the then-current Reset Period and the
immediately following Reset Period, the applicable Index plus or minus the
Spread (with respect to the Reset Rate Notes in floating rate mode) or the
applicable fixed rate, which may be expressed as the fixed rate pricing
benchmark plus or minus a spread (with respect to the Reset Rate Notes in fixed
rate mode), that the Remarketing Agents, in consultation with the Administrator,
determine will be effective, unless the Call Option is exercised, in the event
that 100% of the holders of the Reset Rate Notes choose to hold their Notes for
the upcoming Reset Period. The All Hold Rate shall be a rate that the
Remarketing Agents, in consultation with the Administrator, and in their good
faith determination, believe would result in the remarketing of the entire class
of Reset Rate Notes at a price equal to 100% of the Outstanding Amount thereof.
"Authorized Officer" means (i) with respect to the Trust, any
officer of the Eligible Lender Trustee who is authorized to act for the Eligible
Lender Trustee in matters relating to the Trust pursuant to the Basic Documents
and who is identified on the list of Authorized Officers delivered by the
Eligible Lender Trustee to the Indenture Trustee on the Closing Date (as such
list may be modified or supplemented from time to time thereafter), (ii) with
respect to the Administrator, any officer of the Administrator or any of its
Affiliates who is authorized to act for the Administrator in matters relating to
itself or to the Trust and to be acted upon by the Administrator pursuant to the
Basic Documents and who is identified on the list of Authorized Officers
delivered by the Administrator to the Indenture Trustee on the Closing Date (as
such list may be modified or supplemented from time to time thereafter), (iii)
with respect to the Depositor, any officer of the Depositor or any of its
Affiliates who is authorized to act for the Depositor in matters relating to or
to be acted upon by the Depositor pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Depositor to the
Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter) and (iv) with respect to the
Servicer, any officer of the Servicer who is authorized to act for the Servicer
in matters relating to or to be
Appendix A-1-4
acted upon by the Servicer pursuant to the Basic Documents and who is identified
on the list of Authorized Officers delivered by the Servicer to the Indenture
Trustee on the Closing Date (as such list may be modified or supplemented from
time to time thereafter).
"Available Funds" means, as to a Distribution Date or any
related Monthly Servicing Payment Date, the sum of the following amounts
received with respect to the related Collection Period or, in the case of a
Monthly Servicing Payment Date, the applicable portion of these amounts:
(a) all collections on the Trust Student Loans, including
any Guarantee Payments received on the Trust Student Loans, but net of:
(i) any collections in respect of principal on
the Trust Student Loans applied by the Trust to repurchase
guaranteed loans from the Guarantors under the Guarantee
Agreements, and
(ii) amounts required by the Higher Education Act
to be paid to the Department or to be repaid to borrowers,
whether or not in the form of a principal reduction of the
applicable Trust Student Loan, on the Trust Student Loans for
that Collection Period including Consolidation Loan rebate
fees;
(b) any Interest Subsidy Payments and Special Allowance
Payments with respect to the Trust Student Loans during that Collection
Period;
(c) all Liquidation Proceeds from any Trust Student Loans
which became Liquidated Student Loans during that Collection Period in
accordance with the Servicer's customary servicing procedures, net of
expenses incurred by the Servicer related to their liquidation and any
amounts required by law to be remitted to the borrowers on the
Liquidated Student Loans, and all Recoveries on Liquidated Student
Loans which were written off in prior Collection Periods or during that
Collection Period;
(d) the aggregate Purchase Amounts received during that
Collection Period for those Trust Student Loans repurchased by the
Depositor or purchased by the Servicer or for Trust Student Loans sold
to another eligible lender pursuant to Section 3.11E of the Servicing
Agreement;
(e) the aggregate Purchase Amounts received during that
Collection Period for those Trust Student Loans purchased by Xxxxxx
Mae;
(f) the aggregate amounts, if any, received from Xxxxxx
Mae, the Depositor or the Servicer, as the case may be, as
reimbursement of non-guaranteed interest amounts, or lost Interest
Subsidy Payments and Special Allowance Payments, on the Trust Student
Loans pursuant to the Sale Agreement or Section 3.5 of the Servicing
Agreement, respectively;
(g) amounts received by the Trust pursuant to Sections
3.1 and 3.12 of the Servicing Agreement during that Collection Period
as to yield or principal adjustments;
Appendix A-1-5
(h) any interest remitted by the Administrator to the
Collection Account prior to such Distribution Date or Monthly Servicing
Payment Date;
(i) Investment Earnings for that Distribution Date earned
on amounts on deposit in each Trust Account (other than the Pounds
Sterling Account or any Other Currency Account);
(j) amounts transferred from the Remarketing Fee Account
in excess of the sum of the Reset Period Target Amounts for that
Distribution Date;
(k) payments received under the Interest Rate Cap
Agreement;
(l) amounts transferred from the Reserve Account in
excess of the Specified Reserve Account Balance as of that Distribution
Date;
(m) the Investment Premium Purchase Account Release
Amount transferred from the Investment Premium Purchase Account on that
Distribution Date;
(n) all amounts on deposit in the Investment Reserve
Account not transferred to an Accumulation Account to offset realized
losses on Eligible Investments actually incurred by the Trust as of
that Distribution Date;
(o) all amounts received by the Trust from any Swap
Counterparty, but only to the extent paid in U.S. Dollars during that
Collection Period;
(p) amounts transferred from the Reserve Account in
excess of the Specified Reserve Account Balance for that Distribution
Date;
provided that if on any Distribution Date there would not be sufficient funds,
after application of Available Funds, as defined above, and application of
amounts available from the Capitalized Interest Account and the Reserve Account,
in that order, to pay certain of the items specified in clauses (a) through (e)
of Section 2.8 of the Administration Agreement (but excluding clause (e), and
including clauses (f) and (g) thereof, in the event that a condition exists as
described in either clause (i) or (ii) of the last paragraph of Section 2.8 of
the Administration Agreement), as set forth in Sections 2.9 and 2.10(a) of the
Administration Agreement, relating to such allocations and distributions, then
Available Funds for that Distribution Date will include, in addition to the
Available Funds as defined above, amounts on deposit in the Collection Account,
or amounts held by the Administrator, or which the Administrator reasonably
estimates to be held by the Administrator, for deposit into the Collection
Account which would have constituted Available Funds for the Distribution Date
succeeding that Distribution Date, up to the amount necessary to pay such items,
and the Available Funds for the succeeding Distribution Date will be adjusted
accordingly.
"Basic Documents" means the Trust Agreement, the Indenture,
the Servicing Agreement, the Administration Agreement, the Sale Agreement, the
Purchase Agreement, the Guarantee Agreements, the Note Depository Agreements,
any Remarketing Agreement, the Interest Rate Cap Agreement, any Swap Agreements
(including the Initial Cross-Currency Swap
Appendix A-1-6
Agreement and the Initial Reset Date Currency Swap Agreement) and other
documents and certificates delivered in connection with any such documents.
"Benefit Plan" has the meaning specified in Exhibit C to the
Trust Agreement.
"Xxxx of Sale" has the meaning specified in the Purchase
Agreement or the Sale Agreement, as applicable.
"Book-Entry Note" means a beneficial interest in the Notes,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 2.10 of the Indenture.
"Business Day" means (i) with respect to calculating LIBOR of
a specified maturity, any day on which banks in New York, New York and London,
England are open for the transaction of international business; and (ii) for all
other purposes, any day other than a Saturday, a Sunday or a day on which
banking institutions or trust companies in New York, New York or Wilmington,
Delaware are authorized or obligated by law, regulation or executive order to
remain closed.
"Call Option" means, the option assigned by the Depositor to
SLM Corporation which may be further assigned by SLM Corporation to one of its
subsidiaries as a permitted transferee (provided, that no such subsidiary shall
possess the Call Option if it at any time owned an interest in any of the Trust
Student Loans) to purchase 100% of the Reset Rate Notes in their entirety as of
their Reset Date, exercisable at a price equal 100% of the Outstanding Amount of
the Reset Rate Notes, less all amounts distributed to the Reset Rate Noteholders
as a payment of principal in respect of the related Distribution Date, plus any
accrued and unpaid interest not paid by the Trust in respect of the related
Distribution Date, and pursuant to the terms and conditions set forth in the
Reset Rate Note Procedures.
"Call Option Notice" means a written notice from the holder of
the Call Option or the Administrator, as applicable, stating its desire to
exercise the Call Option on the related Reset Date, delivered to each Clearing
Agency, the Indenture Trustee, the Remarketing Agents, the Rating Agencies and,
if the Reset Rate Notes is then listed on the Luxembourg Stock Exchange, the
Administrator will forward a copy to the Luxembourg Listing Agent (the contents
of which are to be published in a leading newspaper having general circulation
in Luxembourg).
"Call Rate" means, for the Reset Rate Notes during any Reset
Period when the Call Option has been exercised, the rate of interest that is
either (1) if the Reset Rate Notes did not have at least one related Swap
Agreement in effect during the previous Reset Period, the floating rate
applicable for the most recent Reset Period during which the Failed Remarketing
Rate was not in effect; or (2) if the Reset Rate Notes had one or more related
Swap Agreements in effect during the previous Reset Period, the weighted average
of the floating rates of interest that were due to the related Interest Rate
Swap Counterparties from the Trust during the previous Reset Period. The Call
Rate will continue to apply for each Reset Period while the holder of the Call
Option retains the Reset Rate Notes.
"Capitalized Interest Account" means the account designated as
such, established and maintained pursuant to Section 2.3(h) of the
Administration Agreement.
Appendix A-1-7
"Capitalized Interest Account Initial Deposit" means
$21,250,000.
"Carryover Servicing Fee" has the meaning specified in
Attachment A to the Servicing Agreement.
"Class A Note" means a Class A-1 Note, a Class A-2 Note, a
Class A-3 Note, a Class A-4 Note, a Class A-5 Note or a Class A-6 Note.
"Class A Note Interest Shortfall" means, for any Distribution
Date, the excess of (x) the Class A Noteholders' Interest Distribution Amount on
the preceding Distribution Date, over (y) the amount of interest actually
distributed to the Class A Noteholders on the preceding Distribution Date, plus
(2) interest on the amount of that excess, to the extent permitted by law, at
the weighted average interest rate on all of the Class A Notes from the
preceding Distribution Date to the current Distribution Date.
"Class A Note Principal Shortfall" means, as of the close of
any Distribution Date, the excess of (i) the Class A Noteholders' Principal
Distribution Amount on that Distribution Date, over (ii) the amount of principal
actually distributed to the Class A Noteholders or deposited into the
Accumulation Account on such Distribution Date.
"Class A Noteholder" means the Person in whose name a Class A
Note is registered in the Note Register.
"Class A Noteholders' Distribution Amount" means, for any
Distribution Date, the sum of the Class A Noteholders' Interest Distribution
Amount and the Class A Noteholders' Principal Distribution Amount for that
Distribution Date.
"Class A Noteholders' Interest Distribution Amount" means, for
any Distribution Date, the sum of: (1) the amount of interest accrued at the
Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the
Class A-5 Rate or the Class A-6 Rate, as applicable, for the related Accrual
Period on the Outstanding Amount of all classes of Class A Notes on the
immediately preceding Distribution Date(s) after giving effect to all principal
distributions to Class A Noteholders on that preceding Distribution Date or, in
the case of the first Distribution Date, on the Closing Date, and (2) the Class
A Note Interest Shortfall for that Distribution Date.
"Class A Noteholders' Principal Distribution Amount" means,
for any Distribution Date, the Principal Distribution Amount times the Class A
Percentage for that Distribution Date, plus any Class A Note Principal Shortfall
as of the close of business on the preceding Distribution Date; provided that
the Class A Noteholders' Principal Distribution Amount will not exceed the
Outstanding Amount of the Class A Notes (less all amounts, other than Investment
Earnings, on deposit in the Accumulation Account). In addition, on the Class A-1
Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity Date, the
Class A-4 Maturity Date, the Class A-5 Maturity Date or the Class A-6 Maturity
Date, as applicable, the principal required to be distributed to the related
Class A Noteholders will include the amount required to reduce the Outstanding
Amount of that class to zero.
"Class A Notes" means the Floating Rate Class A Notes and the
Reset Rate Notes.
Appendix A-1-8
"Class A Percentage" means 100% minus the Class B Percentage.
"Class A-1 Maturity Date" means the June 2009 Distribution
Date.
"Class A-2 Maturity Date" means the December 2012 Distribution
Date.
"Class A-3 Maturity Date" means the December 2015 Distribution
Date.
"Class A-4 Maturity Date" means the December 2018 Distribution
Date.
"Class A-5 Maturity Date" means the September 2022
Distribution Date.
"Class A-6 Maturity Date" means the March 2038 Distribution
Date.
"Class A-1 Noteholder" means a Person in whose name a Class
A-1 Note is registered in the Note Register.
"Class A-2 Noteholder" means a Person in whose name a Class
A-2 Note is registered in the Note Register.
"Class A-3 Noteholder" means a Person in whose name a Class
A-3 Note is registered in the Note Register.
"Class A-4 Noteholder" means a Person in whose name a Class
A-4 Note is registered in the Note Register.
"Class A-5 Noteholder" means a Person in whose name a Class
A-5 Note is registered in the Note Register.
"Class A-6 Noteholder" means a Person in whose name a Class
A-6 Note is registered in the Note Register.
"Class A-1 Notes" means the $248,000,000 Floating Rate Class
A-1 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-1 thereto.
"Class A-2 Notes" means the $315,000,000 Floating Rate Class
A-2 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-2 thereto.
"Class A-3 Notes" means the $338,000,000 Floating Rate Class
A-3 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-3 thereto.
"Class A-4 Notes" means the $385,000,000 Floating Rate Class
A-4 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-4 thereto.
Appendix A-1-9
"Class A-5 Notes" means the $500,000,000 Floating Rate Class
A-5 Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-5 thereto.
"Class A-6 Notes" means the (pound)396,500,000 Reset Rate
Class A-6 Student Loan-Backed Notes issued by the Trust pursuant to the
Indenture, substantially in the form of Exhibit A-6 thereto.
"Class A-1 Rate" means, for any Accrual Period after the
initial Accrual Period, Three-Month LIBOR as determined on the related LIBOR
Determination Date, plus 0.01%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-1 Rate shall mean the Initial Accrual Rate
plus 0.01%, based on an Actual/360 accrual method.
"Class A-2 Rate" means, for any Accrual Period after the
initial Accrual Period, Three-Month LIBOR as determined on the related LIBOR
Determination Date, plus 0.05%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-2 Rate shall mean the Initial Accrual Rate
plus 0.05%, based on an Actual/360 accrual method.
"Class A-3 Rate" means, for any Accrual Period after the
initial Accrual Period, Three-Month LIBOR as determined on the related LIBOR
Determination Date, plus 0.12%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-3 Rate shall mean the Initial Accrual Rate
plus 0.12%, based on an Actual/360 accrual method.
"Class A-4 Rate" means, for any Accrual Period after the
initial Accrual Period, Three-Month LIBOR as determined on the related LIBOR
Determination Date, plus 0.19%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-4 Rate shall mean the Initial Accrual Rate
plus 0.19%, based on an Actual/360 accrual method.
"Class A-5 Rate" means, for any Accrual Period after the
initial Accrual Period, Three-Month LIBOR as determined on the related LIBOR
Determination Date, plus 0.28%, based on an Actual/360 accrual method. For the
initial Accrual Period, the Class A-5 Rate shall mean the Initial Accrual Rate
plus 0.28%, based on an Actual/360 accrual method.
"Class A-6 Rate" means, for any Accrual Period until and
including the Initial Reset Date for the Class A-6 Notes, 5.45% per annum based
on a Actual/Actual ("ISMA") accrual method with the initial Accrual Period,
consisting of 295 days. The Class A-6 Rate shall be changed on each related
Reset Date to the interest rate and Day Count Basis that will be set forth in
the notice required to be delivered by the Administrator and/or the Remarketing
Agents on each Remarketing Terms Determination Date and Spread Determination
Date, as applicable, pursuant to the procedures set forth in the Reset Rate Note
Procedures.
"Class B Maturity Date" means the March 2038 Distribution
Date.
"Class B Note Interest Shortfall" means, for any Distribution
Date, (1) the excess of (x) the Class B Noteholders' Interest Distribution
Amount on the preceding Distribution Date, over (y) the amount of interest
actually distributed to the Class B Noteholders on that preceding Distribution
Date, plus (2) interest on the amount of that excess, to the extent permitted by
law, at the Class B Rate from that preceding Distribution Date to the current
Distribution Date.
Appendix A-1-10
"Class B Note Principal Shortfall" means, as of the close of
any Distribution Date, the excess of (i) the Class B Noteholders' Principal
Distribution Amount on that Distribution Date over (ii) the amount of principal
actually distributed to the Class B Noteholders on that Distribution Date.
"Class B Noteholder" means the Person in whose name a Class B
Note is registered in the Note Register.
"Class B Noteholders' Distribution Amount" means, for any
Distribution Date, the sum of the Class B Noteholders' Interest Distribution
Amount and the Class B Noteholders' Principal Distribution Amount for that
Distribution Date.
"Class B Noteholders' Interest Distribution Amount" means, for
any Distribution Date, the sum of (1) the amount of interest accrued at the
Class B Rate for the related Accrual Period on the Outstanding Amount of the
Class B Notes on the immediately preceding Distribution Date (or, in the case of
the first Distribution Date, the Closing Date), after giving effect to all
principal distributions to Class B Noteholders on that preceding Distribution
Date, and (2) the Class B Note Interest Shortfall for that Distribution Date.
"Class B Noteholders' Principal Distribution Amount" means,
for any Distribution Date, the Principal Distribution Amount times the Class B
Percentage for that Distribution Date, plus any Class B Note Principal Shortfall
as of the close of business on the preceding Distribution Date; provided that
the Class B Noteholders' Principal Distribution Amount will not exceed the
Outstanding Amount of the Class B Notes. In addition, on the Class B Maturity
Date, the principal required to be distributed to the Class B Noteholders will
include the amount required to reduce the Outstanding Amount of the Class B
Notes to zero.
"Class B Notes" means the $75,943,000 Floating Rate Class B
Student Loan-Backed Notes issued by the Trust pursuant to the Indenture,
substantially in the form of Exhibit A-8 thereto.
"Class B Percentage" with respect to any Distribution Date,
means (1) prior to the Stepdown Date or with respect to any Distribution Date on
which a Trigger Event is in effect, zero; and (2) on and after the Stepdown Date
and provided that no Trigger Event is in effect, a fraction expressed as a
percentage, the numerator of which is the aggregate principal balance of the
Class B Notes immediately prior to that Distribution Date and the denominator of
which is Outstanding Amount of the Notes, less all amounts (other than
Investment Earnings) on deposit in the Accumulation Account, immediately prior
to that Distribution Date.
"Class B Rate" means, for any Accrual Period after the initial
Accrual Date, Three-Month LIBOR as determined on the related LIBOR Determination
Date, plus 0.59% based on an Actual/360 accrual method. For the initial Accrual
Period, the Class B Rate shall mean the Initial Accrual Rate plus 0.59%, based
on an Actual/360 accrual method.
"Clearing Agency" means DTC, Euroclear or Clearstream, as
applicable, or another organization registered as a "clearing agency" pursuant
to applicable law. The initial Clearing Agency for the Floating Rate Notes shall
be DTC and the initial nominee for such Clearing Agency shall be Cede & Co. The
Clearing Agencies for the Reset Rate Notes (i) for
Appendix A-1-11
any Reset Period when they are not denominated in U.S. Dollars (including the
initial Reset Period) shall be Euroclear and Clearstream and the initial joint
nominee for such Clearing Agencies shall be The Bank of New York Depository
(Nominees) Limited, and (ii) for any Reset Period when they are denominated in
U.S. Dollars shall be the same Clearing Agency and nominee applicable to the
Floating Rate Notes.
"Clearing Agency Participant" means a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Clearstream" means Clearstream Banking, societe anonyme,
Luxembourg.
"Closing Date" means November 25, 2003.
"CMT Rate" means, for any relevant Interest Rate Determination
Date prior to each Interest Rate Change Date, the rate displayed on the
applicable Designated CMT Moneyline Telerate Page shown below by 3:00 p.m., New
York City time, on that Interest Rate Determination Date under the caption ". .
.. Treasury Constant Maturities . . . Federal Reserve Board Release H.15 . . .
Mondays Approximately 3:45 p.m.," under the column for: (i) if the Designated
CMT Moneyline Telerate Page is 7051, the rate on that Interest Rate
Determination Date; or (ii) if the Designated CMT Moneyline Telerate Page is
7052, the average for the week, the month or the quarter, as specified on the
Remarketing Terms Determination Date, ended immediately before the week in which
the Interest Rate Determination Date occurs. The following procedures will apply
if the CMT Rate cannot be determined as described above: (i) if the rate
described above is not displayed on the relevant page by 3:00 p.m., New York
City time on that Interest Rate Determination Date, unless the calculation is
made earlier and the rate is available from that source at that time on that
Interest Rate Determination Date, then the CMT Rate will be the Treasury
constant maturity rate having the designated index maturity, as published in
H.15(519) or another recognized electronic source for displaying the rate, (ii)
if the applicable rate described above is not published in H.15(519) or another
recognized electronic source for displaying such rate by 3:00 p.m., New York
City time on that Interest Rate Determination Date, unless the calculation is
made earlier and the rate is available from one of those sources at that time,
then the CMT Rate will be the Treasury constant maturity rate, or other United
States Treasury rate, for the index maturity and with reference to the relevant
Interest Rate Determination Date, that is published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury and that the Administrator determines to be comparable to the rate
formerly displayed on the Designated CMT Moneyline Telerate Page shown above and
published in H.15(519), (iii) if the rate described in the prior paragraph
cannot be determined, then the Administrator will determine the CMT Rate to be a
yield to maturity based on the average of the secondary market closing offered
rates as of approximately 3:30 p.m., New York City time, on the relevant
Interest Rate Determination Date reported, according to their written records,
by leading primary United States government securities dealers in New York City.
The Administrator will select five such securities dealers and will eliminate
the highest and lowest quotations or, in the event of equality, one of the
highest and lowest quotations, for the most recently issued direct noncallable
fixed rate obligations of the United States Treasury ("Treasury Notes") with an
original maturity of approximately the designated index maturity and a remaining
term to maturity of not less than
Appendix A-1-12
the designated index maturity minus one year in a representative amount, (iv) if
the Administrator cannot obtain three Treasury Note quotations of the kind
described above in (iii), the Administrator will determine the CMT Rate to be
the yield to maturity based on the average of the secondary market bid rates for
Treasury Notes with an original maturity longer than the designated CMT index
maturity which have a remaining term to maturity closest to the designated CMT
index maturity and in a representative amount, as of approximately 3:30 p.m.,
New York City time, on the relevant Interest Rate Determination Date of leading
primary United States government securities dealers in New York City. In
selecting these offered rates, the Administrator will request quotations from at
least five such securities dealers and will disregard the highest quotation (or
if there is equality, one of the highest) and the lowest quotation (or if there
is equality, one of the lowest). If two Treasury Notes with an original maturity
longer than the designated CMT index maturity have remaining terms to maturity
that are equally close to the designated CMT index maturity, the Administrator
will obtain quotations for the Treasury Note with the shorter remaining term to
maturity, (v) if three or four but not five leading primary United States
government securities dealers are quoting as described in the prior paragraph,
then the CMT Rate for the relevant Interest Rate Determination Date will be
based on the average of the bid rates obtained and neither the highest nor the
lowest of those quotations will be eliminated, or (vi) if fewer than three
leading primary United States government securities dealers selected by the
Administrator are quoting as described in (v) above, the CMT Rate will remain
the CMT Rate then in effect on that Interest Rate Determination Date.
"Code" means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder.
"Collateral" has the meaning specified in the Granting Clause
of the Indenture.
"Collection Account" means the account designated as such,
established and maintained pursuant to Section 2.3(f) of the Administration
Agreement.
"Collection Account Initial Deposit" means $0.
"Collection Period" means, with respect to the first
Distribution Date, the period beginning on the Cutoff Date and ending on
February 29, 2004, and with respect to each subsequent Distribution Date, the
Collection Period means the three calendar months immediately following the end
of the previous Collection Period.
"Commercial Paper Rate" means, for any relevant Interest Rate
Determination Date prior to each Interest Rate Change Date, the Bond Equivalent
Yield shown below of the rate for 90-day commercial paper, as published in
H.15(519) prior to 3:00 p.m., New York City time, on that Interest Rate
Determination Date under the heading "Commercial Paper -- Financial". If the
rate described above is not published in H.15(519) by 3:00 p.m., New York City
time, on that Interest Rate Determination Date, unless the calculation is made
earlier and the rate was available from that source at that time, then the
Commercial Paper Rate will be the Bond Equivalent Yield of the rate on the
relevant Interest Rate Determination Date, for commercial paper having the index
maturity specified on the Remarketing Terms Determination Date, as published in
H.15 Daily Update or any other recognized electronic source used for displaying
that rate under the heading "Commercial Paper -- Financial". For purposes of the
Appendix A-1-13
definition of "Commercial Paper Rate", the "Bond Equivalent Yield" equals
[(NxD)]/[360(Dx90)] times 100, where "D" refers to the per annum rate determined
as set forth above, quoted on a bank discount basis and expressed as a decimal
and "N" refers to 365 or 366, as the case may be. If the rate described above
cannot be determined, the Commercial Paper Rate will remain the commercial paper
rate then in effect on that Interest Rate Determination Date. Unless otherwise
specified on the Remarketing Terms Determination Date, the Commercial Paper Rate
will be subject to a Lock-In Period of six Business Days.
"Commission" means the Securities and Exchange Commission.
"Consolidation Loans" means Student Loans made in accordance
with the Section 428C of the Higher Education Act.
"Corporate Trust Office" means (i) with respect to the
Indenture Trustee, the principal office of the Indenture Trustee at which at any
particular time its corporate trust business shall be administered, which office
at the Closing Date is located at 000 Xxxxxxx Xxxxxx 0 Xxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Trust Group (telephone: (000) 000-0000, facsimile:
(000) 000-0000) or at such other address as the Indenture Trustee may designate
from time to time by notice to the Noteholders and the Depositor, or the
principal corporate trust office of any successor Indenture Trustee (the address
of which the successor Indenture Trustee will notify the Noteholders, the
Administrator and the Depositor) and (ii) with respect to the Eligible Lender
Trustee, the principal corporate trust office of the Eligible Lender Trustee
located at Christiana Center/OPS4, 000 Xxxxxxx Xxxxxxxxxx Xxxx, Xxxxxx, Xxxxxxxx
00000, Attention: Corporate Trust Department (telephone: (000) 000-0000;
facsimile: (000) 000-0000); or at such other address as the Eligible Lender
Trustee may designate by notice to the Depositor, or the principal corporate
trust office of any successor Eligible Lender Trustee (the address of which the
successor Eligible Lender Trustee will notify the Administrator and the
Depositor).
"Cross-Currency Swap Agreements" means, with respect to the
Reset Rate Notes in Foreign Exchange Mode, each Swap Agreement between the Trust
and the related Cross-Currency Swap Counterparty which (a) in the case of the
initial Cross-Currency Swap Agreement, converts its specified percentage of all
non-U.S. monies paid by purchasers of the Reset Rate Notes into U.S. Dollars,
(b) converts its specified percentage of all payments of U.S. Dollars by the
Trust to the Reset Rate Noteholders into the applicable currency, and (c) pays
to the Paying Agent, on behalf of the Trust, for the benefit of the tendering
Reset Rate Noteholders, its specified percentage of required additional interest
at the interest rate applicable to the tendered Reset Rate Notes resulting from
any required delay in Reset Date payments through Euroclear and Clearstream.
"Cross-Currency Swap Counterparty" means each Eligible Swap
Counterparty which is a party, in its capacity as swap counterparty, to the
related Cross-Currency Swap Agreement.
"Custodian" has the meaning specified in Section 2.1 of the
Indenture.
"Cutoff Date" means October 20, 2003.
Appendix A-1-14
"Day Count Basis" means 30/360, Actual/360, Actual/365
(fixed), Actual/Actual (accrual basis), Actual/Actual (ISMA) or Actual/Actual
(payment basis), as applicable, or any other day count basis set forth in the
Remarketing Terms Notice.
"Default" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"Definitive Notes" has the meaning specified in Section 2.10
of the Indenture.
"Delaware Statutory Trust Act" means Chapter 38 of Title 12,
Part V of the Delaware Code, entitled "Treatment of Delaware Statutory Trusts".
"Delivery" when used with respect to Trust Account Property
means:
(a) with respect to bankers' acceptances, commercial
paper, negotiable certificates of deposit and other obligations that
constitute "instruments" within the meaning of Section 9-102(a)(47) of
the UCC and are susceptible of physical delivery, transfer thereof to
the Indenture Trustee or its nominee or custodian by physical delivery
to the Indenture Trustee or its nominee or custodian endorsed to, or
registered in the name of, the Indenture Trustee or its nominee or
custodian or endorsed in blank, and, with respect to a certificated
security (as defined in Section 8-102(a)(3) of the UCC) transfer
thereof (i) by delivery of such certificated security endorsed to, or
registered in the name of, the Indenture Trustee or its nominee or
custodian or endorsed in blank to a securities intermediary (as defined
in Section 8-102(a)(14) of the UCC) and the making by such securities
intermediary of entries on its books and records identifying such
certificated securities as belonging to the Indenture Trustee or its
nominee or custodian and the sending by such securities intermediary of
a confirmation of the purchase of such certificated security by the
Indenture Trustee or its nominee or custodian, or (ii) by delivery
thereof to a "clearing corporation" (as defined in Section 8-102(a)(5)
of the UCC) and the making by such clearing corporation of appropriate
entries on its books reducing the appropriate securities account of the
transferor and increasing the appropriate securities account of a
securities intermediary by the amount of such certificated security,
the identification by the clearing corporation of the certificated
securities for the sole and exclusive account of the securities
intermediary, the maintenance of such certificated securities by such
clearing corporation or the nominee of either subject to the clearing
corporation's exclusive control, the sending of a confirmation by the
securities intermediary of the purchase by the Indenture Trustee or its
nominee or custodian of such securities and the making by such
securities intermediary of entries on its books and records identifying
such certificated securities as belonging to the Indenture Trustee or
its nominee or custodian (all of the foregoing, but not including Trust
Student Loans, "Physical Property"); and such additional or alternative
procedures as may hereafter become appropriate to effect the complete
transfer of ownership of any such Trust Account Property to the
Indenture Trustee or its nominee or custodian, consistent with changes
in applicable law or regulations or the interpretation thereof;
(b) with respect to any security issued by the U.S.
Treasury, the Government National Mortgage Association, the Federal
Home Loan Mortgage Corporation or the
Appendix A-1-15
Federal National Mortgage Association that is a book-entry security
held at a Federal Reserve Bank pursuant to Federal book-entry
regulations, the following procedures, all in accordance with
applicable law, including applicable Federal regulations and Articles 8
and 9 of the UCC: the crediting of such book-entry security to an
appropriate book-entry account of the Indenture Trustee or its nominee
or the custodian or securities intermediary at a Federal Reserve Bank,
causing the custodian to continuously indicate by book-entry such
book-entry security as credited to the relevant book-entry account, the
continuous crediting of such book-entry security to a securities
account of the custodian at such Federal Reserve Bank and the
continuous identification of such book-entry security by the custodian
as credited to the appropriate book-entry account; and
(c) with respect to any item of Trust Account Property
that is an uncertificated security under Article 8 of the UCC and that
is not governed by clause (b) above, registration on the books and
records of the issuer thereof in the name of the securities
intermediary, the sending of a confirmation by the securities
intermediary of the purchase by the Indenture Trustee or its nominee or
custodian of such uncertificated security, the making by such
securities intermediary of entries on its books and records identifying
such uncertificated certificates as belonging to the Indenture Trustee
or its nominee or custodian.
"Department" means the United States Department of Education,
an agency of the Federal government.
"Depositor" means SLM Funding LLC, a Delaware limited
liability company, and its successors and assigns, including for such purpose, a
permitted transferee of all of SLM Funding LLC's right, title and interest in
the Excess Distribution Certificate.
"Depository Agreements" means the Note Depository Agreements.
"Determination Date" means, with respect to the Collection
Period preceding any Distribution Date, the first Business Day preceding such
Distribution Date.
"Distribution Date" means for any class of Notes, the 15th day
of each of March, June, September and December, or, if such day is not a
Business Day, the immediately following Business Day, commencing on March 15,
2004.
"DTC" means the Depository Trust Company, or any successor
thereto.
"Eligible Deposit Account" means (i) with respect to the Trust
Accounts other than the Pounds Sterling Account or any Other Currency Account,
either (a) a segregated account with an Eligible Institution or (b) a segregated
trust account with the corporate trust department of a depository institution
organized under the laws of the United States of America or any one of the
States or the District of Columbia (or any domestic branch of a foreign bank),
having corporate trust powers and acting as trustee for funds deposited in such
account, so long as any of the securities of such depository institution have a
credit rating from Xxxxx'x, S&P, and, if such institution is rated by Fitch,
Fitch, in one of their generic rating categories which signifies investment
grade and (ii) with respect to the Pounds Sterling Account or any Other Currency
Account, a segregated account with the London Paying Agent.
Appendix A-1-16
"Eligible Institution" means a depository institution
organized under the laws of the United States of America or any one of the
States or the District of Columbia (or any domestic branch of a foreign bank)
(i) which has (A) either a long-term senior unsecured debt rating of "AAA" or a
short-term senior unsecured debt or certificate of deposit rating of "A-1+" or
better by S&P and (B)(1) a long-term senior unsecured debt rating of "A1" or
better and (2) a short-term senior unsecured debt rating of "P-1" or better by
Xxxxx'x, and (C) if such institution is rated by Fitch, a long-term senior
unsecured debt rating of "AA" or a short-term senior unsecured debt rating of
"F-1+", or any other long-term, short-term or certificate of deposit rating with
respect to which the Rating Agency Condition has been satisfied and (ii) whose
deposits are insured by the FDIC. If so qualified, the Eligible Lender Trustee
or the Indenture Trustee may be considered an Eligible Institution.
"Eligible Investments" means book-entry securities, negotiable
instruments or securities represented by instruments in bearer or registered
form which evidence:
(a) direct obligations of, and obligations fully
guaranteed as to timely payment by, the United States of America, the
Government National Mortgage Association, the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association, Xxxxxx
Mae, or any agency or instrumentality of the United States of America
the obligations of which are backed by the full faith and credit of the
United States of America; provided that obligations of, or guaranteed
by, the Government National Mortgage Association, the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association or
Xxxxxx Xxx shall be Eligible Investments only if, at the time of
investment, they meet the criteria of each of the Rating Agencies for
collateral for securities having ratings equivalent to the respective
ratings of the Notes in effect at the Closing Date;
(b) demand deposits, time deposits or certificates of
deposit of any depository institution or trust company incorporated
under the laws of the United States of America or any State (or any
domestic branch of a foreign bank) and subject to supervision and
examination by Federal or state banking or depository institution
authorities (including depository receipts issued by any such
institution or trust company as custodian with respect to any
obligation referred to in clause (a) above or portion of such
obligation for the benefit of the holders of such depository receipts);
provided that at the time of the investment or contractual commitment
to invest therein (which shall be deemed to be made again each time
funds are reinvested following each Distribution Date), the commercial
paper or other short-term senior unsecured debt obligations (other than
such obligations the rating of which is based on the credit of a Person
other than such depository institution or trust company) thereof shall
have a credit rating from each of the Rating Agencies in the highest
investment category granted thereby;
(c) commercial paper having, at the time of the
investment, a rating from each of the Rating Agencies in the highest
investment category granted thereby;
(d) investments in money market funds having a rating
from each of the Rating Agencies in the highest investment category
granted thereby (including funds for
Appendix A-1-17
which the Indenture Trustee, the Administrator or the Eligible Lender
Trustee or any of their respective Affiliates is investment manager or
advisor);
(e) bankers' acceptances issued by any depository
institution or trust company referred to in clause (b) above;
(f) repurchase obligations with respect to any security
that is a direct obligation of, or fully guaranteed by, the United
States of America or any agency or instrumentality thereof the
obligations of which are backed by the full faith and credit of the
United States of America, in either case entered into with a depository
institution or trust company (acting as principal) described in clause
(b) above;
(g) asset-backed securities, including asset-backed
securities issued by Affiliates, or entities formed by Affiliates, of
Xxxxxx Mae, but excluding mortgage-backed securities, that at the time
of investment have a rating in the highest investment category granted
by each of the Rating Agencies; provided that the purchase price of any
such asset-backed security in excess of par must be paid for with
amounts on deposit in the Investment Premium Purchase Account;
(h) Eligible Repurchase Obligations; and
(i) any other investment which would not result in the
downgrading or withdrawal of any rating of the Notes by any of the
Rating Agencies as affirmed in writing delivered to the Indenture
Trustee.
For purposes of the definition of "Eligible Investments" the
phrase "highest investment category" means (i) in the case of Fitch, "AAA" for
long-term investments (or the equivalent) and "F-1+" for short-term investments
(or the equivalent), (ii) in the case of Xxxxx'x, "Aaa" for long-term
investments (or the equivalent) and "P-1" for short-term investments (or the
equivalent), and (iii) in the case of S&P, "AAA" for long-term investments (or
the equivalent) and "A-1+" for short-term investments (or the equivalent). A
proposed investment not rated by Fitch but rated in the highest investment
category by Xxxxx'x and S&P shall be considered to be rated by each of the
Rating Agencies in the highest investment category granted thereby.
"Eligible Lender Trustee" means Chase Manhattan Bank USA,
National Association, a national banking association, not in its individual
capacity but solely as Eligible Lender Trustee under the Trust Agreement.
"Eligible Lender Trustee" shall also mean each successor Eligible Lender Trustee
as of the qualification of such successor as Eligible Lender Trustee under the
Trust Agreement.
"Eligible Loans" has the meaning specified in the Purchase
Agreement or the Sale Agreement, as applicable.
"Eligible Repo Counterparty" means an institution that is an
eligible lender (under the Family Federal Family Education Loan Program) or that
holds Student Loans through an eligible lender trustee and whose short-term debt
ratings are not less than "P-1" by Xxxxx'x, "A-1" by S&P and "F-1" by Fitch, if
rated by Fitch.
Appendix A-1-18
"Eligible Repurchase Obligations" means repurchase obligations
with respect to Student Loans serviced by Xxxxxx Xxx Servicing L.P. or an
Affiliate thereof, entered into with an Eligible Repo Counterparty, provided
that the applicable repurchase date shall occur no later than the Business Day
prior to the next Distribution Date.
"Eligible Swap Counterparty" means an entity, which may be an
affiliate of a Remarketing Agent, engaged in the business of entering into
derivative instrument contracts that satisfies the Rating Agency Condition.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"Euroclear" means the Euroclear System, or any successor
thereto.
"European Clearing Systems" means Euroclear or Clearstream.
"Event of Default" has the meaning specified in Section 5.1 of
the Indenture.
"Excess Distribution Certificate" means the certificate,
substantially in the form of Exhibit A to the Trust Agreement, evidencing the
right to receive payments thereon as set forth in Sections 2.8(p), 2.9(f) and
2.10(a)(ii) of the Administration Agreement.
"Excess Distribution Certificate Paying Agent" means any
paying agent or co-paying agent appointed pursuant to Section 3.13(g) of the
Trust Agreement, which shall initially be the Eligible Lender Trustee.
"Excess Distribution Certificate Register" and "Excess
Distribution Certificate Registrar" mean the register mentioned and the
registrar appointed pursuant to Section 3.13(c) of the Trust Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Executive Officer" means, with respect to any corporation,
the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, any Executive Vice President, any Senior Vice President, any Vice
President, the Secretary or the Treasurer of such corporation; and with respect
to any partnership, any general partner thereof.
"Expenses" means any and all liabilities, obligations, losses,
damages, taxes, claims, actions and suits, and any and all reasonable costs,
expenses and disbursements (including reasonable legal fees and expenses) of any
kind and nature whatsoever which may at any time be imposed on, incurred by, or
asserted against the Eligible Lender Trustee or any of its officers, directors
or agents in any way relating to or arising out of the Trust Agreement, the
other Basic Documents, the Trust Estate, the administration of the Trust Estate
or the action or inaction of the Eligible Lender Trustee under the Trust
Agreement or the other Basic Documents.
"Extension Rate" means, for each Distribution Date following a
Failed Remarketing if the Reset Rate Notes are then in Foreign Exchange Mode,
the rate of interest payable to each related Cross-Currency Swap Counterparty,
not to exceed Three-Month LIBOR
Appendix A-1-19
plus 0.75%, unless the Remarketing Agents, in consultation with the
Administrator, determine that market conditions or some other benefit to the
Trust requires a higher rate; provided that in such case the Rating Agency
Condition is satisfied. The initial Extension Rate for the Reset Rate Notes
under the Initial Cross-Currency Swap Agreement is Three-Month LIBOR plus 0.75%.
"Failed Remarketing" means, on any Reset Date for the Reset
Rate Notes, the situation where:
(a) the Remarketing Agents, in consultation with the
Administrator, cannot establish one or more of the terms required to be
set on the Remarketing Terms Determination Date;
(b) the Remarketing Agents are unable to establish the
Spread or fixed rate on the Spread Determination Date;
(c) either the Remarketing Agents are unable to remarket
some or all of the tendered Reset Rate Notes at the Spread or fixed
rate established on the Spread Determination Date, or any committed
purchasers default on their purchase obligations and in their sole
discretion, the Remarketing Agents elect not to purchase those Reset
Rate Notes themselves;
(d) the Remarketing Agents, in consultation with the
Administrator, are unable to obtain one or more Swap Agreements meeting
the required criteria, if applicable;
(e) any of the conditions specified in Section 8 of the
Remarketing Agreement are not satisfied; or
(f) any applicable Rating Agency Condition has not been
satisfied.
"Failed Remarketing Rate" means, for any Reset Period when the
Reset Rate Notes are then denominated in U.S. Dollars, Three-Month LIBOR plus
0.75%; and for the Reset Rate Notes while in Foreign Exchange Mode, as will be
determined on the Spread Determination Date pursuant to the terms of the related
Cross-Currency Swap Agreement (and for the initial Reset Period for the Reset
Rate Notes, the Failed Remarketing Rate will be Three-Month GBP-LIBOR plus
0.55%).
"FDIC" means the Federal Deposit Insurance Corporation.
"Federal Funds Rate" means the rate set forth for such day
opposite the caption "Federal Funds (effective)" in the weekly statistical
release designated H.15(519), or any successor publication, published by the
Board of Governors of the Federal Reserve System. If such rate is not published
in the relevant H.15(519) for any day, the rate for such day shall be the
arithmetic mean of the rates for the last transaction in overnight Federal Funds
arranged prior to 9:00 a.m. New York City time on that day by each of four
leading brokers in such transactions located in New York City selected by the
Administrator. The Federal Funds rate for each Saturday and Sunday and for any
other that is not a Business Day shall be the Federal Funds Rate for the
preceding Business Day as determined above.
Appendix A-1-20
"Fitch" means Fitch Inc., also known as Fitch Ratings, or any
successor rating agency.
"Floating Rate Class A Notes" means the Class A-1 Notes, Class
A-2 Notes, Class A-3 Notes, Class A-4 Notes and Class A-5 Notes.
"Floating Rate Noteholder" means the Person in whose name a
Floating Rate Note is registered in the Note Register.
"Floating Rate Notes" means the Floating Rate Class A Notes
and the Class B Notes.
"Foreign Exchange Mode" means that the Reset Rate Notes are
then denominated in a currency other than U.S. Dollars during the related Reset
Period.
"Four-Month LIBOR" see "Three-Month LIBOR".
"GBP-LIBOR" MEANS, WITH RESPECT TO ANY ACCRUAL PERIOD, WILL BE
THE LONDON INTERBANK OFFERED RATE FOR DEPOSITS IN POUNDS STERLING HAVING THE
SPECIFIED MATURITY COMMENCING ON THE FIRST DAY OF THE ACCRUAL PERIOD, WHICH
APPEARS ON TELERATE PAGE 3750 AS OF 11:00 A.M. LONDON TIME, ON THE RELATED
GBP-LIBOR DETERMINATION DATE. IF AN APPLICABLE RATE DOES NOT APPEAR ON TELERATE
PAGE 3750, THE RATE FOR THAT DAY WILL BE DETERMINED ON THE BASIS OF THE RATES AT
WHICH DEPOSITS IN POUNDS STERLING, HAVING THE SPECIFIED MATURITY AND IN A
PRINCIPAL AMOUNT OF NOT LESS THAN L 1,000,000, ARE OFFERED AT APPROXIMATELY
11:00 A.M., LONDON TIME, ON THAT GBP-LIBOR DETERMINATION DATE, TO PRIME BANKS IN
THE LONDON INTERBANK MARKET BY THE REFERENCE BANKS. THE ADMINISTRATOR WILL
REQUEST THE PRINCIPAL LONDON OFFICE OF EACH REFERENCE BANK TO PROVIDE A
QUOTATION OF ITS RATE. IF THE REFERENCE BANKS PROVIDE AT LEAST TWO QUOTATIONS,
THE RATE FOR THAT DAY WILL BE THE ARITHMETIC MEAN OF THE QUOTATIONS. IF THE
REFERENCE BANKS PROVIDE FEWER THAN TWO QUOTATIONS, THE RATE FOR THAT DAY WILL BE
THE ARITHMETIC MEAN OF THE RATES QUOTED BY PRIME BANKS IN LONDON, SELECTED BY
THE ADMINISTRATOR, AT APPROXIMATELY 11:00 A.M. NEW YORK TIME, ON THAT GBP-LIBOR
DETERMINATION DATE, FOR LOANS IN POUNDS STERLING TO LEADING EUROPEAN BANKS
HAVING THE SPECIFIED MATURITY AND IN A PRINCIPAL AMOUNT OF NOT LESS THAN
L 1,000,000. IF THE BANKS SELECTED AS DESCRIBED ABOVE ARE NOT PROVIDING
QUOTATIONS, GPB-LIBOR IN EFFECT FOR THE APPLICABLE ACCRUAL PERIOD WILL BE
GBP-LIBOR FOR THE SPECIFIED MATURITY IN EFFECT FOR THE PREVIOUS ACCRUAL PERIOD.
"GBP-LIBOR Determination Date" means, for each Accrual Period,
the second Settlement Day before the beginning of that Accrual Period.
"Global Note Certificate" means a global note certificate
representing interests in the Reset Rate Notes offered and sold in reliance on
Rule 144A or Regulation S, as applicable.
Appendix A-1-21
"Grant" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create and xxxxx x xxxx
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to the Indenture. A Grant of the Collateral or of any other
agreement or instrument shall include all rights, powers and options (but none
of the obligations) of the Granting party thereunder, including the immediate
and continuing right to claim for, collect, receive and give receipt for
principal and interest payments in respect of the Collateral and all other
moneys payable thereunder, to give and receive notices and other communications,
to make waivers or other agreements, to exercise all rights and options, to
bring Proceedings in the name of the Granting party or otherwise and generally
to do and receive anything that the Granting party is or may be entitled to do
or receive thereunder or with respect thereto.
"Guarantee Agreement" means any agreement between any
Guarantor and the Eligible Lender Trustee providing for the payment by the
Guarantor of amounts authorized to be paid pursuant to the Higher Education Act
to holders of qualifying Student Loans guaranteed in accordance with the Higher
Education Act by such Guarantor.
"Guarantee Payment" means any payment made by a Guarantor
pursuant to a Guarantee Agreement in respect of a Trust Student Loan.
"Guarantor" means any entity listed on Attachment B (as
amended from time to time) to the Sale Agreement the Purchase Agreement.
"H.15(519)" means the weekly statistical release designated as
such, or any successor publication, published by the Board of Governors of the
United States Federal Reserve System.
"H.15 Daily Update" means the daily update for H.15(519),
available through the world wide web site of the Board of Governors of the
Federal Reserve System at xxxx://xxx.xxxxxxxxxxxxxx.xxx/xxxxxxxx/x00/xxxxxx, or
any successor site or publications.
"Higher Education Act" means the Higher Education Act of 1965,
as amended, together with any rules, regulations and interpretations thereunder.
"Hold Notice" means a written statement (or an oral statement
confirmed in writing, which may be by e-mail) from a holder or beneficial owner
of a Reset Rate Note delivered to a Remarketing Agent that such holder or
beneficial owner desires to hold its Reset Rate Notes for the upcoming Reset
Period and affirmatively agrees to receive a rate of interest of not less than
the applicable All Hold Rate during that Reset Period.
"Indenture" means the Indenture dated as of November 1, 2003,
among the Eligible Lender Trustee on behalf of the Trust, the Trust and the
Indenture Trustee.
"Indenture Trust Estate" means all money, instruments, rights
and other property that are subject or intended to be subject to the lien and
security interest of the Indenture for the benefit of the Noteholders and, as
applicable, each Swap Counterparty (including all Collateral Granted to the
Indenture Trustee), including all proceeds thereof.
Appendix A-1-22
"Indenture Trustee" means The Bank of New York, a New York
banking corporation, not in its individual capacity but solely as trustee under
the Indenture.
"Independent" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Trust, any other
obligor upon the Notes, the Depositor and any Affiliate of any of the foregoing
Persons, (b) does not have any direct financial interest or any material
indirect financial interest in the Trust, any such other obligor, the Depositor
or any Affiliate of any of the foregoing Persons and (c) is not connected with
the Trust, any such other obligor, the Depositor or any Affiliate of any of the
foregoing Persons as an officer, employee, promoter, underwriter, placement
agent, trustee, partner, director or person performing similar functions.
"Independent Certificate" means a certificate or opinion to be
delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.1 of the
Indenture, made by an Independent appraiser or other expert appointed by an
Issuer Order and approved by the Indenture Trustee in the exercise of reasonable
care, and such opinion or certificate shall state that the signer has read the
definition of "Independent" in the Indenture and that the signer is Independent
within the meaning thereof.
"Index" or "Indices" means LIBOR, GBP-LIBOR, a Commercial
Paper Rate, the CMT Rate, the Federal Funds Rate, the 91-day Treasury Xxxx Rate,
the Prime Rate or any other interest rate index specified in Schedule A to the
Reset Rate Notes.
"Index Maturity" means, with respect to any Accrual Period,
the interval between Interest Rate Change Dates for each applicable Index during
such Accrual Period, commencing on the first day of that Accrual Period.
"Initial Accrual Rate" means for each class of Notes (other
than the Reset Rate Notes during their initial Reset Period) and the Accrual
Period commencing on the Closing Date to, but excluding, the first Distribution
Date, the rate per annum as determined on the related Determination Date, as
follows:
X + [19/29 x (Y - X)]
where:
X = Three-Month LIBOR, and
Y = Four-Month LIBOR
"Initial Cross-Currency Swap Agreement" means, with respect to
the Reset Rate Notes, the Swap Agreement, dated as of November 14, 2003, between
the Trust and Citibank, N.A., as the Initial Cross-Currency Swap Counterparty,
which (i) converts all Pounds Sterling paid by Purchasers of the Reset Rate
Notes into U.S. Dollars, (ii) converts all payments of U.S. Dollars by the Trust
to the Reset Rate Noteholders into Pounds Sterling, and (iii) pays to the London
Paying Agent, on behalf of the Trust, for the benefit of the tendering Reset
Rate Noteholders, additional interest at the interest rate applicable to the
tendered Reset Rate Notes resulting from any required delay in Reset Date
payments through Euroclear and Clearstream, in each case using the Initial
Dollar/Pounds Sterling Conversion Rate.
Appendix A-1-23
"Initial Cross-Currency Swap Counterparty" means Citibank,
N.A., with respect to L 396,500,000 initial principal balance of Reset Rate
Notes.
"Initial Dollar/Pounds Sterling Conversion Rate" means an
exchange rate of $1.6884 = L 1.00.
"Initial Pool Balance" means the Pool Balance as of the Cutoff
Date, which is $2,506,345,117.
"Initial Purchasers" means, collectively, Citigroup Global
Markets Inc., Citigroup Global Markets Limited, Credit Suisse First Boston LLC,
Credit Suisse First Boston (Europe) Limited, Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated, Xxxxxxx Xxxxx International and Barclays Bank PLC.
"Initial Remarketing Agency Agreement" means each agreement,
substantially in the form of Appendix B to the Remarketing Agreement to be
entered into on each Remarketing Terms Determination Date (unless the Call
Option has been exercised) among the Remarketing Agents, the Administrator and
the Trust.
"Initial Reset Date" means, for the Reset Rate Notes, the
Distribution Date in September 2013.
"Initial Reset Date Currency Swap Agreement" means, with
respect to the Reset Rate Notes, the Swap Agreement, dated as of November 14,
2003, between Citibank N.A., as the Swap Agent, not in its individual capacity,
but solely in its capacity as Swap Agent for the Remarketing Agents pursuant to
the Remarketing Agreement, and Citibank, N.A., as the Initial Cross-Currency
Swap Counterparty, to convert all secondary market trade proceeds received by
the Remarketing Agents in U.S. Dollars on the Reset Date resulting in a
successful remarketing of the Reset Rate Notes or exercise of the Call Option at
the end of the initial Reset Period for the Reset Rate Notes, into Pounds
Sterling for payment of principal to the tendering Reset Rate Noteholders, in
each case using the Initial Dollar/Pounds Sterling Conversion Rate.
"Initial Reset Date Notice" means the written notice delivered
pursuant to Section 3(a) of the Reset Rate Note Procedures.
"Initial Swap Agreements" mean the Initial Cross-Currency Swap
Agreement and the Initial Reset Date Currency Swap Agreement.
"Insolvency Event" means, with respect to a specified Person,
(a) the filing of a decree or order for relief by a court having jurisdiction in
the premises in respect of such Person or any substantial part of its property
in an involuntary case under any applicable Federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or appointing a
receiver, liquidator, assignee, custodian, trustee, sequestrator or similar
official for such Person or for any substantial part of its property, or
ordering the winding-up or liquidation of such Person's affairs, which decree or
order remains unstayed and in effect for a period of 60 consecutive days; or (b)
the commencement by such Person of a voluntary case under any applicable Federal
or state bankruptcy, insolvency or other similar law now or hereafter in effect,
or the consent by such Person to the entry of an order for relief in an
involuntary case under any such law, or the
Appendix A-1-24
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 Rate Cap Agreement" means the agreement between the
Trust and Xxxxxx Xxx, dated November 14, 2003, documented under a 1992 ISDA
Master Agreement (Multicurrency-Cross Border), including the related schedule
and confirmation, providing for certain payments to the Trust, in the amounts
and under the conditions set forth therein, which will terminate in accordance
with its terms on or before the March 2005 Distribution Date.
"Interest Rate Cap Confirmation" means the confirmation
executed under the Interest Rate Cap Agreement dated as of November 14, 2003
representing the interest rate cap in a notional amount of $370,000,000.
"Interest Rate Cap Swap Counterparty" means Xxxxxx Mae and any
successors or permitted assigns.
"Interest Rate Change Date" means for each Accrual Period, the
date or dates, based on the applicable Index, on which the rate of interest for
the Reset Rate Notes bearing interest at a floating rate is to be reset.
"Interest Rate Determination Date" means, for each Accrual
Period, and (i) for the Reset Rate Notes that bear interest at a LIBOR or
GBP-LIBOR-based rate, the related LIBOR or GBP-LIBOR Determination Date, as
applicable, or (ii) for the Reset Rate Notes that bear interest at a floating
rate that is not LIBOR-based, the applicable date or dates set forth in the
Remarketing Terms Notice, on which the applicable rate of interest to be in
effect as of the next Interest Rate Change Date will be determined by the
Administrator.
"Interest Rate Swap Counterparty" means each Eligible Swap
Counterparty with which the Trust enters into an Interest Rate Swap Agreement.
"Interest Subsidy Payments" means payments, designated as
such, consisting of interest subsidies by the Department in respect of the Trust
Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Interest Rate Swap Agreement" means, with respect to the
Reset Rate Notes during any Reset Period when they are denominated in U.S.
Dollars and (i) bear a fixed rate of interest, or (ii) bear interest based on an
index other than LIBOR or a U.S. Commercial Paper Rate, any Swap Agreement
between the Trust and an Eligible Swap Counterparty, to hedge the basis risk
during the Reset Period.
"Interim Eligible Lender Trustee" means Chase Manhattan Bank
USA, National Association, a national banking association, not in its individual
capacity but solely as Interim Eligible Lender Trustee under the Interim Trust
Agreement. "Interim Eligible Lender Trustee" shall also mean each successor
Interim Eligible Lender Trustee as of the qualification of such Interim Eligible
Lender Trustee under the Interim Trust Agreement.
Appendix A-1-25
"Interim Trust Agreement" means the Interim Trust Agreement
dated as of November 1, 2003, between the Depositor and the Interim Eligible
Lender Trustee.
"Interim Trust Loans" has the meaning set forth in the Interim
Trust Agreement.
"Investment Earnings" means, with respect to any Distribution
Date, the Investment Earnings (net of losses and investment expenses) on amounts
on deposit in the Trust Accounts to be deposited into the Collection Account on
or prior to such Distribution Date pursuant to Section 2.3(b) of the
Administration Agreement.
"Investment Premium Purchase Account" means an account
designated as such, established and maintained pursuant to Section 2.3(l) of the
Administration Agreement.
"Investment Premium Purchase Account Deposit Amount" means,
with respect to each Distribution Date when funds are deposited into an
Accumulation Account, an amount equal to (a) 1.00% of the amount deposited into
each such Accumulation Account on such Distribution Date, or (b) with respect to
any Distribution Date that is one year or less prior to a Reset Date relating to
the Reset Rate Notes for which funds are then on deposit in an Accumulation
Account, 0.50% of the amount deposited into the Accumulation Account on such
Distribution Date.
"Investment Premium Purchase Account Release Amount" means,
with respect to any Distribution Date that is one year or less prior to a Reset
Date relating to the Reset Rate Notes for which funds are then on deposit in an
Accumulation Account, the amount, if any, to be withdrawn from the Investment
Premium Purchase Account so that the remaining funds on deposit in such
Investment Premium Purchase Account will be equal to the lesser of (a) 0.50% of
the amount on deposit in the Accumulation Account, and (b) the amount then on
deposit the Investment Premium Purchase Account; provided that on any
Distribution Date that is also a Reset Date for the Reset Rate Notes for which
amounts are then on deposit in an Accumulation Account, all Investment Premium
Purchase Account Deposit Amounts relating to such Accumulation Account that
remain on deposit in the Investment Premium Purchase Account will become part of
the Investment Premium Purchase Account Release Amount on such Distribution
Date.
"Investment Reserve Account" means an account designated as
such, established and maintained pursuant to Section 2.3(m) of the
Administration Agreement.
"Investment Reserve Account Required Amount" means, with
respect to each Distribution Date, immediately following the date when the
ratings of any Eligible Investment in an Accumulation Account has been
downgraded by one or more Rating Agencies, an amount (to the extent of Available
Funds), to be set by each applicable Rating Agency in satisfaction of the Rating
Agency Condition (but not to exceed the amount of the unrealized loss on the
related Eligible Investment).
"Issuer" means the Trust and, for purposes of any provision
contained in the Indenture and required by the TIA, each other obligor on the
Notes.
Appendix A-1-26
"Issuer Order" and "Issuer Request" means a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.
"LIBOR" means Three-Month LIBOR and Four-Month LIBOR, as
applicable.
"LIBOR Determination Date" means, for each Accrual Period, the
second Business Day before the beginning of that Accrual Period.
"Lien" means a security interest, lien, charge, pledge, equity
or encumbrance of any kind, other than tax liens and any other liens, if any,
which attach to the respective Trust Student Loan by operation of law as a
result of any act or omission by the related Obligor.
"Liquidated Student Loan" means any defaulted Trust Student
Loan liquidated by the Servicer (which shall not include any Trust Student Loan
on which Guarantee Payments are received) or which the Servicer has, after using
all reasonable efforts to realize upon such Trust Student Loan, determined to
charge off.
"Liquidation Proceeds" means, with respect to any Liquidated
Student Loan which became a Liquidated Student Loan during the current
Collection Period in accordance with the Servicer's customary servicing
procedures, the moneys collected in respect of the liquidation thereof from
whatever source, other than Recoveries, net of the sum of any amounts expended
by the Servicer in connection with such liquidation and any amounts required by
law to be remitted to the Obligor on such Liquidated Student Loan.
"Loan" has the meaning set forth in Section 2 of the Purchase
Agreement.
"Lock-In Period" means a period from the first day of such
Lock-In Period (which may be expressed as a number of Business Days prior to a
Distribution Date) to the immediately succeeding Interest Payment Date during
which the interest rate, Index or other calculation in effect on the first day
of such Lock-In Period shall remain in effect for every day in such Lock-In
Period.
"London Paying Agent" means, with respect to the Reset Rate
Notes while in Foreign Exchange Mode, the Indenture Trustee or any other Person
that meets the eligibility standards for the Indenture Trustee specified in
Section 6.11 of the Indenture and is authorized by the Eligible Lender Trustee
on behalf of the Trust to make the payments to and distributions from the Pounds
Sterling Account or any Other Currency Account and shall initially be The Bank
of New York London.
"Luxembourg Listing Agent" means, initially, The Bank of New
York (Luxembourg) S.A.
"Luxembourg Paying Agent" means, initially, The Bank of New
York (Luxembourg) S.A.
"Minimum Purchase Amount" means an amount that would be
sufficient to (i) reduce the Outstanding Amount of each class of Notes, less the
amount on deposit in the
Appendix A-1-27
Accumulation Account with respect to the Reset Rate Notes, on such Distribution
Date to zero and (ii) pay to the respective Noteholders the Class A Noteholders'
Interest Distribution Amount and the Class B Noteholders' Interest Distribution
Amount payable on such Distribution Date.
"Monthly Servicing Payment Date" means the 15th day of each
calendar month or, if such day is not a Business Day, the immediately following
Business Day, commencing on December 15, 2003.
"Moody's" means Xxxxx'x Investors Service, Inc., or any
successor rating agency.
"Note" and "Notes" means any of the Floating Rate Notes and
the Reset Rate Notes.
"Note Depository Agreements" means with respect to the Notes,
the Letter of Representations, dated November 25, 2003, among the Trust, the
Eligible Lender Trustee and the Indenture Trustee in favor of DTC, and with
respect to the Reset Rate Notes, the Instruction Letter from Issuer to Common
Depositary, dated November 25, 2003 between the Trust and The Bank of New York
Depository (Nominees) Limited.
"Note Final Maturity Date" for a class of Notes means the
Class A-1 Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity
Date, the Class A-4 Maturity Date, the Class A-5 Maturity Date, the Class A-6
Maturity Date or the Class B Maturity Date, as applicable.
"Note Interest Shortfall" means the Class A Note Interest
Shortfall, if any, and/or the Class B Note Interest Shortfall, as applicable.
"Note Owner" means, with respect to a Book-Entry Note, the
Person who is the owner of such Book-Entry Note, as reflected on the books of
the applicable Clearing Agency, or on the books of a Person maintaining an
account with such Clearing Agency (directly as a Clearing Agency Participant or
as an indirect participant, in each case in accordance with the rules of such
Clearing Agency).
"Note Pool Factor" means, as of the close of business on a
Distribution Date, a seven-digit decimal figure equal to the Outstanding Amount
of a class of Notes divided by the original Outstanding Amount of such class of
Notes. The Note Pool Factor for each class will be 1.0000000 as of the Closing
Date; thereafter, the Note Pool Factor for each class will decline to reflect
reductions in the Outstanding Amount of that class of Notes.
"Note Purchase Agreement" means the Note Purchase Agreement
dated as of November 14, 2003, among the Depositor, the Seller and the Initial
Purchasers.
"Note Rates" means, with respect to any Accrual Period, the
Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the
Class A-5 Rate, the Class A-6 Rate and the Class B Rate for such Accrual Period,
collectively.
Appendix A-1-28
"Note Register" and "Note Registrar" have the respective
meanings specified in Section 2.4 of the Indenture.
"Noteholder" means a Floating Rate Noteholder, a Class A
Noteholder, a Reset Rate Noteholder or a Class B Noteholder, as the context
requires.
"Notes" means the Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes, the Class A-4 Notes, the Class A-5 Notes, the Class A-6 Notes
and the Class B Notes, collectively.
"Notice Date" means, for the Reset Rate Notes, 12:00 p.m.
(noon), New York City time, on the sixth day prior to the Reset Date.
"Obligor" on a Trust Student Loan means the borrower or
co-borrowers of such Trust Student Loan and any other Person who owes payments
in respect of such Trust Student Loan, including the Guarantor thereof and, with
respect to any Interest Subsidy Payment or Special Allowance Payment, if any,
thereon, the Department.
"Officers' Certificate" means (i) in the case of the Trust, a
certificate signed by any two Authorized Officers of the Eligible Lender
Trustee, under the circumstances described in, and otherwise complying with, the
applicable requirements of Section 11.1 of the Indenture, and delivered to the
Indenture Trustee, and (ii) in the case of the Depositor, the Administrator or
the Servicer, a certificate signed by any two Authorized Officers of the
Depositor, the Administrator or the Servicer, as applicable.
"Opinion of Counsel" means (i) with respect to the Trust, one
or more written opinions of counsel who may, except as otherwise expressly
provided in the Indenture, be employees of or counsel to the Eligible Lender
Trustee, the Trust, the Depositor or an Affiliate of the Depositor and who shall
be satisfactory to the Indenture Trustee, and which opinion or opinions shall be
addressed to the Indenture Trustee as Indenture Trustee, shall comply with any
applicable requirements of Section 11.1 of the Indenture and shall be in form
and substance satisfactory to the Indenture Trustee, and (ii) with respect to
the Depositor, the Administrator or the Servicer, one or more written opinions
of counsel who may be an employee of or counsel to the Depositor, the
Administrator or the Servicer, which counsel shall be acceptable to the
Indenture Trustee and the Eligible Lender Trustee.
"Origination Fee" means the origination fee payable to the
Department by the lender with respect to any Trust Student Loan made on or after
October 1, 1993, equal to 0.50% of the initial principal balance of such loan.
"Other Currency Account" means each account designated as
such, established and maintained pursuant to Section 2.3(o) of the
Administration Agreement.
"Outstanding" means, as of the date of determination, all
Notes theretofore authenticated and delivered under the Indenture except:
(a) Notes theretofore cancelled by the Note Registrar or
delivered to the Note Registrar for cancellation;
Appendix A-1-29
(b) Notes, or portions thereof, for which payment has
been made to the applicable Noteholders in reduction of the outstanding
principal balance thereof or for which money in the necessary amount
has been theretofore deposited with the Indenture Trustee or any Paying
Agent in trust for the Noteholders thereof (excluding for such purpose
any amounts on deposit in the Accumulation Account); provided, however,
that if such Notes are to be redeemed, notice of such redemption has
been duly given pursuant to the Indenture; and
(c) Notes in exchange for or in lieu of other Notes which
have been authenticated and delivered pursuant to the Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser; provided that in determining
whether the Noteholders of the requisite Outstanding Amount of the
Notes have given any request, demand, authorization, direction, notice,
consent or waiver hereunder or under any other Basic Document, Notes
owned by the Trust, any other obligor upon the Notes, the Depositor or
any Affiliate of any of the foregoing Persons shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the
Indenture Trustee shall be protected in relying upon any such request,
demand, authorization, direction, notice, consent or waiver, only Notes
that a Responsible Officer of the Indenture Trustee either actually
knows to be so owned or has received written notice thereof shall be so
disregarded. Notes so owned that have been pledged in good faith may be
regarded as Outstanding if the pledgee establishes to the satisfaction
of the Indenture Trustee the pledgee's right so to act with respect to
such Notes and that the pledgee is not the Trust, any other obligor
upon the Notes, the Depositor or any Affiliate of any of the foregoing
Persons.
"Outstanding Amount" means the aggregate principal balance of
all the Notes or the applicable class or classes of Notes, as the case may be,
Outstanding at the date of determination; provided, however, that if the Reset
Rate Notes are then in Foreign Exchange Mode, the Outstanding Amount shall be
based on the U.S. Dollar Equivalent Principal Amount of the Reset Rate Notes.
"Paying Agent" means, with respect to the Notes (other than
Reset Rate Notes denominated in a currency other than U.S. Dollars), the
Indenture Trustee or any other Person that meets the eligibility standards for
the Indenture Trustee specified in Section 6.11 of the Indenture and is
authorized by the Eligible Lender Trustee, on behalf of the Trust, to make the
payments to and distributions from the Collection Account and payments of
principal of and interest and any other amounts owing on the Notes on behalf of
the Trust. With respect to the Reset Rate Notes denominated in a currency other
than U.S. Dollars, Paying Agent means the London Paying Agent and the Luxembourg
Paying Agent.
"Person" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization, limited liability
company, limited liability partnership or government or any agency or political
subdivision thereof.
"Physical Property" has the meaning assigned to such terms in
the definition of "Delivery" above.
Appendix A-1-30
"Pool Balance" for any date means the aggregate principal
balance of the Trust Student Loans on that date, including accrued interest that
is expected to be capitalized, as reduced by:
(a) all payments received by the Trust through that date from
borrowers, the Guarantors and the Department;
(b) all amounts received by the Trust through that date from
purchases of the Trust Student Loans by Xxxxxx Xxx, the Depositor, or
the Servicer;
(c) all Liquidation Proceeds and Realized Losses on the Trust
Student Loans liquidated through that date;
(d) the amount of any adjustments to balances of the Trust
Student Loans that the Servicer makes under the Servicing Agreement
through that date; and
(e) the amount by which Guarantor reimbursements of principal
on defaulted Trust Student Loans through that date are reduced from
100% to 98%, or other applicable percentage, as required by the risk
sharing provisions of the Higher Education Act.
"Pounds Sterling Account" means each account designated as
such, established and maintained pursuant to Section 2.3(n) of the
Administration Agreement.
"Predecessor Note" means, with respect to any particular Note,
every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and, for the purpose of this definition, any
Note authenticated and delivered under Section 2.5 of the Indenture and in lieu
of a mutilated, lost, destroyed or stolen Note shall be deemed to evidence the
same debt as the mutilated, lost, destroyed or stolen Note.
"Primary Servicing Fee" for any Monthly Servicing Payment Date
has the meaning specified in Attachment A to the Servicing Agreement, and shall
include any such fees from prior Monthly Servicing Payment Dates that remain
unpaid.
"Prime Rate" means, for any relevant Interest Rate
Determination Date prior to each Interest Rate Change Date, the prime rate or
base lending rate on that date, as published in H.15(519), prior to 3:00 p.m.,
New York City time, on that Interest Rate Determination Date under the heading
"Bank Prime Loan." The Administrator will observe the following procedures if
the Prime Rate cannot be determined as described above: (i) if the rate
described above is not published in H.15(519) prior to 3:00 p.m., New York City
time, on the relevant Interest Rate Determination Date unless the calculation is
made earlier and the rate was available from that source at that time, then the
Prime Rate will be the rate for that Interest Rate Determination Date, as
published in H.15 Daily Update or another recognized electronic source for
displaying such rate opposite the caption "Bank Prime Loan", (ii) if the above
rate is not published in either H.15(519), H.15 Daily Update or another
recognized electronic source for displaying such rate by 3:00 p.m., New York
City time, on the relevant Interest Rate Determination Date, then the
Administrator will determine the Prime Rate to be the average of the rates of
interest publicly announced by each bank that appears on the Reuters screen
designated as "USPRIME1" as that bank's prime rate or base lending rate as in
effect on that Interest Rate Determination Date,
Appendix A-1-31
(iii) if fewer than four rates appear on the Reuters screen USPRIME1 page on
the relevant Interest Rate Determination Date, then the Prime Rate will be the
average of the prime rates or base lending rates quoted, on the basis of the
actual number of days in the year divided by a 360-day year, as of the close of
business on that Interest Rate Determination Date by three major banks in New
York City selected by the Administrator, or (iv) if the banks selected by the
Administrator are not quoting as mentioned above, the Prime Rate will remain the
prime rate then in effect on that Interest Rate Determination Date.
"Principal Distribution Amount" means, (i) with respect to the
initial Distribution Date, the amount by which the sum of the Outstanding Amount
of the Notes exceeds the Adjusted Pool Balance for that Distribution Date, and
(ii) with respect to each subsequent Distribution Date, the sum of (a) the
amount by which the Adjusted Pool Balance for the preceding Distribution Date
exceeds the Adjusted Pool Balance for that Distribution Date, and (b) any
amounts received under the Interest Rate Cap Agreement for that Distribution
Date.
"Proceeding" means any suit in equity, action at law or other
judicial or administrative proceeding.
"Purchase Agreement" means the Purchase Agreement Master
Securitization Terms Number 1000 dated as of November 25, 2003, among Xxxxxx
Mae, the Interim Eligible Lender Trustee and the Depositor.
"Purchase Amount" with respect to any Trust Student Loan means
the amount required to prepay in full such Trust Student Loan under the terms
thereof including all accrued interest thereon.
"Purchased Student Loan" means a Trust Student Loan which is,
as of the close of business on the last day of a Collection Period, purchased by
the Servicer pursuant to Section 3.5 of the Servicing Agreement or repurchased
by the Depositor pursuant to Section 6 of the Sale Agreement, purchased by
Xxxxxx Xxx pursuant to Section 6 of the Purchase Agreement.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A under the Act.
"Quarterly Funding Amount" means, for the Reset Rate Notes,
for any Distribution Date that is (1) more than one year before the next Reset
Date, zero and (2) one year or less before the next Reset Date, an amount to be
deposited into the Remarketing Fee Account for the Reset Rate Notes so that the
amount therein equals the Quarterly Required Amount; provided, however, that if
on any Distribution Date that is not a Reset Date, the amount on deposit in the
Remarketing Fee Account is greater than the Quarterly Required Amount, such
excess will be transferred to the Collection Account and included in Available
Funds for that Distribution Date.
"Quarterly Required Amount" means, for the Reset Rate Notes,
(1) on any Reset Date, the Reset Period Target Amount or (2) on a Distribution
Date that is one year or less before the next Reset Date, (x) the Reset Period
Target Amount multiplied by (y) 5 minus the number of Distribution Dates
remaining until the next Reset Date (excluding the current Distribution Date and
including the next Reset Date), divided by (z) five (5).
Appendix A-1-32
"Rating Agency" means Xxxxx'x, S&P and Fitch. If any such
organization or successor thereto is no longer in existence, "Rating Agency"
with respect to such organization shall be a nationally recognized statistical
rating organization or other comparable Person designated by the Administrator,
notice of which designation shall be given to the Indenture Trustee, the
Eligible Lender Trustee and the Servicer.
"Rating Agency Condition" means, with respect to any intended
action, that each Rating Agency then rating a class of Notes shall have been
given 10 days' prior written notice thereof and that each such Rating Agency
shall have notified the Administrator, the Servicer, the Eligible Lender
Trustee, the Indenture Trustee and the Remarketing Agents, if applicable, in
writing that such proposed action will not result in and of itself in the
reduction or withdrawal of its then-current rating of any class of Notes.
"Realized Loss" means the excess of the principal balance,
including any interest that had been or had been expected to be capitalized, of
any Liquidated Student Loan over Liquidation Proceeds for that Liquidated
Student Loan to the extent allocable to principal, including any interest that
had been or had been expected to be capitalized.
"Record Date" means, with respect to a Distribution Date or
Redemption Date and for each class of Notes, the close of business on the day
preceding such Distribution Date or Redemption Date.
"Recoveries" means moneys collected from whatever source with
respect to any Liquidated Student Loan which was written off in prior Collection
Periods or during the current Collection Period, net of the sum of any amounts
expended by the Servicer for the account of any Obligor and any amounts required
by law to be remitted to any Obligor.
"Redemption Date" means in the case of a payment to
Noteholders pursuant to Section 10.1 of the Indenture, the Distribution Date
specified pursuant to Section 10.1 of the Indenture.
"Redemption Price" means an amount equal to the Outstanding
Amount of the Notes, plus accrued and unpaid interest thereon at the applicable
Note Rates to but excluding the Redemption Date.
"Reference Banks" means, with respect to (i) LIBOR, four major
banks in the London interbank market for deposits in U.S Dollars selected by the
Administrator and (ii) GBP-LIBOR, four major banks in the London interbank
market for deposits in Pounds Sterling selected by the Administrator.
"Registrar" means the Excess Distribution Certificate
Registrar and/or the Note Registrar, as applicable.
"Regulation S" means Regulation S promulgated under the Act.
"Remarketing Agency Agreement" means the collective reference
to an Initial Remarketing Agency Agreement and the Supplemental Remarketing
Agency Agreement.
Appendix A-1-33
"Remarketing Agent" means, initially, each of Citigroup Global
Markets Inc., Credit Suisse First Boston LLC and Xxxxxxx Lynch, Pierce, Xxxxxx &
Xxxxx Incorporated. The Administrator, in its sole discretion, may change any
Remarketing Agent for the Reset Rate Notes for any Reset Period at any time on
or before a Remarketing Terms Determination Date.
"Remarketing Agreement" means the Remarketing Agreement dated
as of November 25, 2003 among the Remarketing Agents, the Swap Agents, the
Administrator and the Trust, as amended or supplemented from time to time.
"Remarketing Fee Account" means the account designated as
such, established and maintained pursuant to Section 2.3(i) of the
Administration Agreement.
"Remarketing Terms Determination Date" means, for the Reset
Rate Notes, not later than 3:00 p.m., New York City time, on the eighth Business
Day prior to the applicable Reset Date.
"Remarketing Terms Notice" means the notice delivered by the
Remarketing Agents to the applicable Noteholders of the Reset Rate Notes, the
Indenture Trustee, the Rating Agencies and the applicable Clearing Agencies on
each Remarketing Terms Determination Date containing the information set forth
in the Reset Rate Note Procedures (Appendix A-2 to the Indenture).
"Reserve Account" means the account designated as such,
established and maintained pursuant to Section 2.3(g) of the Administration
Agreement.
"Reserve Account Initial Deposit" means $6,265,863.
"Reset Date" means a Distribution Date on which certain terms
for the Reset Rate Notes may be changed in accordance with the Reset Rate Note
Procedures (Appendix A-2 to the Indenture).
"Reset Date Currency Swap Agreements" means, with respect to
the Reset Rate Notes in Foreign Exchange Mode, each Swap Agreement between a
Swap Agent, not in its individual capacity but solely in its capacity as Swap
Agent for the benefit of the Remarketing Agents and the Reset Rate Noteholders
pursuant to the Remarketing Agreement, and an Eligible Swap Counterparty to
convert its specified percentage of secondary market trade proceeds received by
the Remarketing Agents into U.S. Dollars on the effective date of such Swap
Agreement, and into the applicable currency for payment of principal to the
tendering Reset Rate Noteholders on the Reset Date resulting in the successful
remarketing of the Reset Rate Notes or the exercise of the Call Option.
"Reset Period" means, with respect to the Reset Rate Notes, a
period of at least three months (or any other longer duration that is a multiple
of three months) that will always end on the day before a Distribution Date,
which such Distribution Date will be the next Reset Date; provided, that no
Reset Period may end after the day before the Reset Rate Notes Maturity Date.
Appendix A-1-34
"Reset Period Target Amount" means, for the Reset Rate Notes
and any Distribution Date that is (1) more than one year before the next Reset
Date, zero, and (2) one year or less before the next Reset Date, the highest
remarketing fee payable to the Remarketing Agents for the Reset Rate Notes (not
to exceed 0.35% of the maximum principal balance of the Reset Rate Notes that
could be remarketed) on the next Reset Date as determined by the Administrator
based on the assumed weighted average life of the Reset Rate Notes and the
maximum remarketing fee set forth on a schedule attached to the Remarketing
Agreement, as such schedule may be amended from time to time.
"Reset Rate Note" means any Class A-6 Note.
"Reset Rate Note Procedures" means Appendix A-2 to the
Indenture.
"Reset Rate Noteholder" means the Person in whose name a Reset
Rate Note is registered in the Note Register.
"Reset Rate Notes" means the Class A-6 Notes.
"Reset Rate Notes Maturity Date" means the Class A-6 Maturity
Date.
"Responsible Officer" means, with respect to the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture Trustee,
including any Vice President, Assistant Vice President, Assistant Treasurer,
Assistant Secretary, or any other officer of the Indenture Trustee customarily
performing functions similar to those performed by any of the above designated
officers, with direct responsibility for the administration of the Indenture and
the other Basic Documents on behalf of the Indenture Trustee and also, with
respect to a particular matter, any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the
particular subject.
"Rule 144A" means Rule 144A promulgated under the Act.
"S&P" means Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies, Inc., or any successor rating agency.
"Sale Agreement" means the Sale Agreement dated as of November
25, 2003, among the Eligible Lender Trustee on behalf of the Trust, the Trust,
the Interim Eligible Lender Trustee and the Depositor.
"Xxxxxx Mae" means the Student Loan Marketing Association.
"Schedule of Trust Student Loans" means the listing of the
Trust Student Loans set forth in Schedule A to the Indenture and the Xxxx of
Sale (which Schedule may be in the form of microfiche).
"Schedule Replacement Order" means an Issuer Order replacing
Schedule A to the Reset Rate Notes to be delivered with respect to the Reset
Date.
Appendix A-1-35
"Servicer" means Xxxxxx Mae Servicing L.P., in its capacity as
servicer of the Trust Student Loans, or any successor thereto in such capacity
in accordance with the Servicing Agreement.
"Servicer Default" means an event specified in Section 5.1 of
the Servicing Agreement.
"Servicer Distribution Date" has the meaning specified in the
Servicing Agreement.
"Servicer's Report" means any report of the Servicer delivered
pursuant to Section 3.1(a) of the Administration Agreement, substantially in the
form acceptable to the Administrator.
"Servicing Agreement" means the Servicing Agreement dated as
of November 25, 2003, among the Trust, the Eligible Lender Trustee, the
Servicer, the Administrator and the Indenture Trustee.
"Servicing Fee" has the meaning specified in Attachment A to
the Servicing Agreement.
"Settlement Day" means any day on which the Trans-European
Automated Real-time Gross Settlement Express Transfer System is open which is
also a day on which banks in New York City are open for business.
"Short-Form Trust Agreement" means the trust agreement dated
as of November 4, 2003, between the Depositor and the Eligible Lender Trustee,
pursuant to which the Trust was established.
"Special Allowance Payments" means payments, designated as
such, consisting of effective interest subsidies by the Department in respect of
the Trust Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"Specified Reserve Account Balance" for any Distribution Date
means the greater of:
(a) 0.25% of the Pool Balance as of the close of business on
the last day of the related Collection Period; and
(b) $3,759,518;
provided that in no event will that balance exceed the Outstanding Amount. For
these purposes, as to the Reset Rate Notes then bearing a fixed rate of
interest, the Outstanding Amount of the Reset Rate Notes will be reduced by any
amounts (less any Investment Earnings) on deposit in the Accumulation Account
for the Reset Rate Notes.
"Spread" means the percentage, determined by the Remarketing
Agents on the Spread Determination Date, with respect to the Reset Rate Notes
that is to bear a floating rate of
Appendix A-1-36
interest, in excess of or below the applicable interest rate Index that will be
applicable to the Reset Rate Notes during any Reset Period after the initial
Reset Period so as to result in an interest rate that, in the reasonable opinion
of the Remarketing Agents, will enable all of the tendered Reset Rate Notes to
be remarketed by the Remarketing Agents at 100% of the Outstanding Amount of
such Reset Rate Notes.
"Spread Determination Date" means, for the Reset Rate Notes,
not later than 3:00 p.m., New York City time, on the third Business Day prior to
the applicable Reset Date.
"Spread Determination Notice" means the notice delivered by
the Remarketing Agents to the Noteholders of the Reset Rate Notes, the Indenture
Trustee, the Rating Agencies, the Clearing Agencies and, if the Reset Rate Notes
are then listed on the Luxembourg Stock Exchange, the Luxembourg Stock Exchange
on each Spread Determination Date containing the information set forth in the
Reset Rate Note Procedures (Appendix A-2 to the Indenture).
"State" means any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx xx
Xxxxxxx or the District of Columbia.
"Stepdown Date" means the earlier to occur of (i) the December
2008 Distribution Date or (2) the first date on which no Class A Notes remain
Outstanding.
"Student Loans" means education loans to students and parents
of students under the Federal Family Education Loan Program.
"Successor Administrator" has the meaning specified in Section
3.7(e) of the Indenture.
"Successor Servicer" has the meaning specified in Section
3.7(e) of the Indenture.
"Supplement" means the SLM Student Loan Trust 2003-12
Administration Agreement Supplement dated November 25, 2003, to Master
Administration Agreement dated as of May 1, 1997, among the Depositor, the
Servicer, the Trust, the Eligible Lender Trustee, the Indenture Trustee and the
Administrator.
"Supplemental Interest Account" means each account designated
as such, established and maintained pursuant to Section 2.3(k) of the
Administration Agreement.
"Supplemental Interest Account Deposit Amount" means, with
respect to the Reset Rate Notes while in fixed rate mode, and for any
Distribution Date, the lesser of:
(a) the product of:
(i) the difference between (x) the weighted average
of the LIBOR-based rates (as determined on the LIBOR
Determination Date immediately preceding that Distribution
Date) that will be payable by the Trust to the related Swap
Counterparty on the next Distribution Date, and (y) an assumed
rate of Investment Earnings that satisfies the Rating Agency
Condition,
Appendix A-1-37
(ii) the amount on deposit in the Accumulation
Account immediately after that Distribution Date, and
(iii) the actual number of days from that
Distribution Date to the next Reset Date for the Reset Rate
Notes, divided by 360; and
(b) an amount that satisfies the Rating Agency Condition.
"Supplemental Remarketing Agency Agreement" means each
agreement, substantially in the form of Appendix C to the Remarketing Agreement
to be entered into on each Spread Determination Date (unless the Call Option has
been exercised or a Failed Remarketing has been declared) among the Remarketing
Agents, the Administrator and the Trust.
"Swap Agent" means initially, Citibank, N.A., for the Initial
Reset Date Currency Swap Agreement and for any subsequent Reset Date Currency
Swap Agreement, the entity appointed by the Remarketing Agents that is acting as
agent for the Remarketing Agents and for the benefit of the Reset Rate
Noteholders, and directed by the Remarketing Agents to enter into a Reset Date
Currency Swap Agreement.
"Swap Agreement" means the applicable ISDA Master Agreement,
and each related swap schedule and/or Swap Confirmation pursuant to the terms
and conditions set forth in the Reset Rate Note Procedures, with respect to (i)
each Cross-Currency Swap Agreement and each Interest Rate Swap Agreement to be
entered into from time to time by the Administrator or the Eligible Lender
Trustee in either case solely on behalf of the Trust and an Eligible Swap
Counterparty, (ii) each Reset Date Currency Swap Agreement to be entered into
from time to time by a Swap Agent, as agent for the Remarketing Agents and for
the benefit of the holders of the Reset Rate Notes, and an Eligible Swap
Counterparty and (iii) the Interest Rate Cap Agreement.
"Swap Confirmation" means each swap confirmation relating to a
Swap Agreement.
"Swap Counterparty" means each Eligible Swap Counterparty from
time to time party to a Swap Agreement, the Initial Cross-Currency Swap
Counterparty (with respect to the Initial Cross-Currency Swap Agreement) and
Xxxxxx Xxx (with respect to the Interest Rate Cap Agreement).
"Swap Interest Payments" means, with respect to each
Distribution Date, the amount payable to the related Swap Counterparty by the
Trust as a quarterly premium payment pursuant to the related Swap Agreement.
"Swap Payments" means, with respect to each Distribution Date,
the amount, if any, payable to a Swap Counterparty by the Trust for such date,
including amounts due and unpaid from prior Distribution Dates (other than Swap
Termination Payments), as specified in the applicable Swap Agreement.
Appendix A-1-38
"Swap Receipts" means, with respect to each Distribution Date,
the amount required to be received from the related Swap Counterparty by the
Trust for such date (other than Swap Termination Payments), as specified in the
related Swap Agreement.
"Swap Termination Date" means the date on which Swap Agreement
terminates in accordance with its terms, which with respect to any Initial
Interest Rate Swap Agreement is scheduled to be the Initial Reset Date for the
Reset Rate Notes.
"Swap Termination Payments" shall have the meaning set forth
in each Swap Agreement.
"Telerate Page 248" means the display page so designated on
the Moneyline Telerate Service (or such other page as may replace that page on
that service for the purpose of displaying comparable rates or prices).
"Telerate Page 3750" means the display page so designated on
the Moneyline Telerate Service (or such other page as may replace that page on
that service for the purpose of displaying comparable rates or prices).
"Telerate Page 7051" means the display page so designated on
the Moneyline Telerate Service (or such other page as may replace that page on
that service for the purpose of displaying comparable rates or prices).
"Telerate Page 7052" means the display page so designated on
the Moneyline Telerate Service (or such other page as may replace that page on
that service for the purpose of displaying comparable rates or prices).
"Three-Month LIBOR" and "Four-Month LIBOR" means, with respect
to any Accrual Period, the London interbank offered rate for deposits in U.S.
Dollars having the Index Maturity which appears on Telerate Page 3750 as of
11:00 a.m. London time, on the related LIBOR Determination Date. If this rate
does not appear on Telerate Page 3750, the rate for that day will be determined
on the basis of the rates at which deposits in U.S. Dollars, having the Index
Maturity and in a principal amount of not less than U.S. $1,000,000, are offered
at approximately 11:00 a.m., London time, on that LIBOR Determination Date, to
prime banks in the London interbank market by the Reference Banks. The
Administrator will request the principal London office of each Reference Bank to
provide a quotation of its rate. If the Reference Banks provide at least two
quotations, the rate for that day will be the arithmetic mean of the quotations.
If the Reference Banks provide fewer than two quotations, the rate for that day
will be the arithmetic mean of the rates quoted by major banks in New York City,
selected by the Administrator, at approximately 11:00 a.m., New York time, on
that LIBOR Determination Date, for loans in U.S. Dollars to leading European
banks having the Index Maturity and in a principal amount of not less than U.S.
$1,000,000. If the banks selected as described above are not providing
quotations, LIBOR in effect for the applicable Accrual Period will be LIBOR, for
the specified maturity in effect for the previous Accrual Period.
"Transfer" an offer, sale, pledge, transfer or other
disposition of a Note or any interest therein.
Appendix A-1-39
"Transfer Date" has the meaning specified in Section 5.2(a) of
the Administration Agreement.
"Treasury Regulations" means regulations, including proposed
or temporary regulations, promulgated under the Code. References in any document
or instrument to specific provisions of proposed or temporary regulations shall
include analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.
"Trigger Event" means, on any Distribution Date while any of
the Class A Notes are outstanding, the Outstanding Amount of the Notes, less any
amounts (other than Investment Earnings) on deposit in the Accumulation Account,
after giving effect to distributions to be made on that Distribution Date, would
exceed the Adjusted Pool Balance as of the end of the related Collection Period.
"Trust" means SLM Student Loan Trust 2003-12, a Delaware
statutory trust established pursuant to the Short-Form Trust Agreement.
"Trust Account Property" means the Trust Accounts, all cash
and investments held from time to time in any Trust Account (whether in the form
of deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), including the Reserve Account Initial Deposit and the
Capitalized Interest Account Initial Deposit and all earnings on and proceeds of
the foregoing.
"Trust Accounts" has the meaning specified in Section 2.3(b)
of the Administration Agreement.
"Trust Agreement" means the Amended and Restated Trust
Agreement, dated as of November 25, 2003 among the Depositor, the Eligible
Lender Trustee and the Indenture Trustee, which amended and restated the
Short-Form Trust Agreement.
"Trust Auction Date" has the meaning specified in Section 4.4
of the Indenture.
"Trust Estate" means all right, title and interest of the
Trust (or the Eligible Lender Trustee on behalf of the Trust) in and to the
property and rights sold, transferred and assigned to the Trust pursuant to the
Sale Agreement, all funds on deposit from time to time in the Trust Accounts and
all other property of the Trust from time to time, including any rights of the
Eligible Lender Trustee and the Trust pursuant to the Trust Agreement, the
Administration Agreement, the Servicing Agreement, any Interest Rate Swap
Agreements and the Interest Rate Cap Agreement.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act
of 1939 as in force on the date hereof, unless otherwise specifically provided.
"Trust Student Loan" means any student loan that is listed on
the Schedule of Trust Student Loans on the Closing Date, plus any student loan
that is permissibly substituted for a Trust Student Loan by the Depositor
pursuant to Sections 6 of the Sale Agreement or by the Servicer pursuant to
Section 3.5 of the Servicing Agreement, but shall not include any Purchased
Student Loan following receipt by or on behalf of the Trust of the Purchase
Amount with respect
Appendix A-1-40
thereto or any Liquidated Student Loan following receipt by or on behalf of the
Trust of Liquidation Proceeds with respect thereto or following such Liquidated
Student Loan having otherwise been written off by the Servicer.
"Trust Student Loan Files" means the documents specified in
Section 2.1 of the Servicing Agreement.
"UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction, as amended
from time to time.
"U.S. Dollar Equivalent Principal Amount" means, with respect
to the Reset Rate Notes while in Foreign Exchange Mode, the U.S. Dollar
equivalent of the Outstanding Amount of the Reset Rate Notes as of the date of
determination based on the exchange rate provided in the related Cross-Currency
Swap Agreement.
Appendix X-0-00
XXXXXXXX X-0
RESET RATE NOTE PROCEDURES
Section 1. Definitions. All terms which are defined in
Appendix A-1 shall have the same meanings in this Appendix A-2.
Section 2. Interest Rates; Principal Payments (a) The Reset
Rate Notes will bear interest for each Reset Period at the rate set forth on
Schedule A attached to the Reset Rate Note as determined in accordance with
Section 2(b) below; provided, that for the initial Reset Period, the Reset Rate
Notes will bear interest from the Closing Date through and including the Initial
Reset Date at the rate set forth in the first sentence of the definitions of
"Class A-6 Rate". Interest on the Reset Rate Notes shall be payable by the trust
with respect to each Distribution Date at the priority level set forth in
Section 2.8(d) of the Administration Agreement; provided, that if interest due
to the Reset Rate Notes is payable through a Swap Agreement, the related Swap
Interest Payments will be payable by the Trust to the related Swap Counterparty,
and by the Swap Counterparty to the Trust (for payment to the Reset Rate
Noteholders), as described in Section 10 below.
(b) After the initial Reset Period, the Reset Rate Notes may
be reset to bear either a fixed or floating rate of interest at the option of
the Remarketing Agents, in consultation with the Administrator. The interest
rate of the Reset Rate Notes will be reset as of each Reset Date as determined
by (i) the Remarketing Agents, in consultation with the Administrator, with
respect to (A) the length of the Reset Period, (B) whether the rate is fixed or
floating and (x) if floating, the applicable Index, or (y) if fixed, the
applicable pricing benchmark, (C) the applicable Day Count Basis, (D) the
applicable currency denomination, i.e., U.S. Dollars, Euros, Pounds Sterling or
another non-U.S. Dollar currency, (E) if in Foreign Exchange Mode, the
applicable Distribution Dates on which interest will be paid to the Reset Rate
Noteholders, (F) the applicable Interest Rate Determination Dates within each
Accrual Period, (G) the interval between Interest Rate Change Dates during each
Accrual Period and (H) if applicable, the All Hold Rate, and (ii) the
Remarketing Agents (in their sole determination) with respect to the setting of
the (A) fixed rate of interest or (B) Spread to the chosen Index, as applicable.
(c) In the event that the Reset Rate Notes are reset (i) to
bear (or continue to bear) interest at a floating rate, (ii) to bear (or
continue to bear) a fixed rate of interest and/or (iii) to be denominated (or
continue to be denominated) in a currency other than U.S. Dollars, and the
Remarketing Agents, in consultation with the Administrator determine that it
would be in the best interest of the Trust based on existing market conditions
to enter into one or more Swap Agreements, the Administrator will be responsible
for arranging, on behalf of the Trust, one or more Swap Agreements to hedge the
basis risk and/or currency exchange risk (as applicable) and, together with the
Remarketing Agents, for selecting the Swap Counterparties thereto in accordance
with the procedures set forth in Section 10(b) below. The Reset Rate Notes will
not be reset (or continue) to bear interest at a floating rate that is not based
on LIBOR or a Commercial Paper Rate, at a fixed rate or to be denominated in a
currency other than U.S. Dollars unless one or more Swap Agreements are entered
into as of the related Reset Date that
Appendix A-2-1
results in the Rating Agency Condition being satisfied. In connection with each
Swap Agreement, the Remarketing Agents shall solicit bids from Eligible Swap
Counterparties in accordance with the procedures set forth in Section 10(d)
below.
(d) The Reset Rate Notes that bear interest at (i) a floating
rate shall be entitled to receive payments of principal in reduction of its
Outstanding Amount on each Distribution Date at the priority level set forth in
Section 2.8(f) of the Administration Agreement and (ii) a fixed rate shall be
entitled to receive allocations of principal at the priority level set forth in
Section 2.8(f) of the Administration Agreement on each Distribution Date,
provided, however, that such amounts referred to in this clause (ii) shall not
be paid in reduction of the Outstanding Amount of the Reset Rate Notes; instead
all such amounts shall be deposited into the Accumulation Account for payment to
the Reset Rate Noteholders or Swap Counterparty, as applicable, on or about the
next Reset Date as set forth in Section 11(a) below.
Section 3. End of Reset Period Notice. (a) Unless the holder
of the Call Option has delivered the related Call Option Notice, the
Administrator, not less than fifteen nor more than thirty calendar days prior to
any Remarketing Terms Determination Date, will (i) give written notice
(including facsimile or other electronic transmission, if permitted pursuant to
the recipient's standard procedures) to the applicable Clearing Agencies and the
Luxembourg Stock Exchange (for so long as the Reset Rate Notes are listed on
such exchange), with a copy to the Indenture Trustee, notifying them of the
upcoming Reset Date and stating whether tender is deemed mandatory or optional
for the Reset Rate Notes on the Reset Date (the Initial Reset Date Notice"),
(ii) request that each Clearing Agency notify its participants of (1) the
contents of the Initial Reset Date Notice, (2) the Remarketing Terms Notice to
be given on the Remarketing Terms Determination Date pursuant to Section 4(d)
below, (3) the Spread Determination Notice to be given on the Spread
Determination Date pursuant to Section 9(e) below, and (4) if applicable, the
procedures concerning the timely delivery of a Hold Notice pursuant to Section 8
below that must be followed if any beneficial owner of a Reset Rate Note wishes
to retain its Reset Rate Notes. For so long as the Reset Rate Notes are listed
on the Luxembourg Stock Exchange, a copy of such notices will be sent to the
Luxembourg Stock Exchange and each of the Remarketing Terms Notice and the
Spread Determination Notice will also be published in a leading newspaper having
general circulation in Luxembourg (which is expected to be The Luxemburger Wort)
and (iii) initiate discussions with representatives of the Luxembourg Stock
Exchange regarding an addendum to the Offering Memorandum dated November 14,
2003, if required by Section 7(f)(i) of the Remarketing Agreement.
(b) The Administrator will also include in the Initial Reset
Date Notice the names and contact information of the Luxembourg listing agent,
if applicable, and any Remarketing Agents confirmed or appointed by the
Administrator, or if no Remarketing Agents have then been so chosen, the
Administrator will provide adequate contact information for Reset Rate
Noteholders to receive information regarding the upcoming Reset Date.
(c) If the related Clearing Agency or its respective nominee,
as applicable, is no longer the holder of record of the Reset Rate Notes, the
Administrator, or the Remarketing Agents on its behalf, will send the Reset Rate
Noteholders, with a copy to the Indenture Trustee and the Luxembourg listing
agent, as applicable, the required notices setting forth the information in
Sections 3(a) and 3(b) above not less than fifteen nor more than thirty calendar
Appendix A-2-2
days prior to any Remarketing Terms Determination Date. In addition, in the
event that Definitive Notes evidencing an interest in the Reset Rate Notes are
issued, the Administrator shall cause the Note Registrar to provide to the
relevant Reset Rate Noteholders and the Luxembourg listing agent, as applicable,
any additional procedures applicable to such Reset Rate Notes while in
definitive form.
Section 4. Remarketing Terms Determination Date. (a) Subject
to the provisions of the Remarketing Agreement, prior to the Remarketing Terms
Determination Date, and unless the holder of the Call Option has delivered the
Call Option Notice, the Administrator shall re-affirm the capability of the
initial Remarketing Agents to perform under the Remarketing Agreement, and/or
enter into new remarketing agreements with other or additional remarketing
agents, who shall function as the Remarketing Agents with respect to the Reset
Date. On each Remarketing Terms Determination Date, the Trust, the Administrator
and the Remarketing Agents will enter into a Remarketing Agency Agreement for
the remarketing of the Reset Rate Notes.
(b) If the Remarketing Agents, in consultation with the
Administrator, determine prior to the Remarketing Terms Determination Date that
any Cross-Currency Swap Agreements or Reset Date Currency Swap Agreements
required pursuant to Section 2(c)(iii) above will not be obtainable on the Reset
Date, the Reset Rate Notes must be denominated in U.S. Dollars during the next
Reset Period.
(c) Unless the holder of the Call Option has delivered
the Call Option Notice, on or prior to the Remarketing Terms Determination Date
the Remarketing Agents will notify the Reset Rate Noteholders whether tender is
deemed mandatory or optional and, in consultation with the Administrator, will
establish the following terms for the Reset Rate Notes to be applicable during
the immediately following Reset Period:
(i) the expected weighted average life of the Reset Rate
Notes, based on prepayment and other assumptions customary for
comparable securities;
(ii) the name and contact information of the Remarketing
Agents;
(iii) the next Reset Date and length of such Reset Period;
(iv) the interest rate mode (i.e., fixed rate or floating
rate);
(v) the currency denomination;
(vi) the applicable minimum denominations and additional
increments for the Reset Rate Notes;
(vii) if in Foreign Exchange Mode, the identities of the
Eligible Swap Counterparties from which bids will be solicited and the
identity, if known, of the proposed Swap Agent for each related
Eligible Swap Counterparty;
Appendix A-2-3
(viii) if in Foreign Exchange Mode, the applicable
Distribution Dates on which interest and principal will be paid to the
Reset Rate Noteholders;
(ix) if in floating rate mode, the applicable Index;
(x) if in floating rate mode, the interval between
Interest Rate Change Dates;
(xi) if in floating rate mode, the applicable Interest Rate
Determination Date;
(xii) if in fixed rate mode, the applicable fixed rate
pricing benchmark;
(xiii) if in fixed rate mode, the identities of the Eligible
Swap Counterparties from which bids will be solicited;
(xiv) if in floating rate mode, whether there will be a
related Swap Agreement and, if so, the identities of the Eligible Swap
Counterparties from which bids will be solicited;
(xv) the applicable Day Count Basis;
(xvi) the All Hold Rate, if applicable;
(xvii) if Definitive Notes are to be issued, the procedures
for delivery and exchange of Definitive Notes and for dealing with lost
or mutilated notes; and
(xviii) any other relevant terms incidental to the foregoing
(other than the Spread or fixed rate of interest, as applicable) for
the next Reset Period;
provided, that any interest rate mode, other than a floating rate based on LIBOR
or a Commercial Paper Rate, will require that the Rating Agency Condition be
satisfied prior to the delivery of the Remarketing Terms Notice.
(d) The Remarketing Agents will communicate all of the
information established in Section 4(c) above in the Remarketing Terms Notice
required to be given in writing (including facsimile or other electronic
transmission if in accordance with each Clearing Agency's standard procedures)
to each Clearing Agency (and the Luxembourg Stock Exchange if the Reset Rate
Notes are then listed on such exchange) or the Reset Rate Noteholders if
Definitive Notes have been issued, as applicable, the Indenture Trustee and the
Rating Agencies on the Remarketing Terms Determination Date.
(e) In addition, prior to the Remarketing Terms Determination
Date, the Administrator shall cause the Schedule Replacement Order with respect
to the Reset Rate Notes to be delivered to the Indenture Trustee, the Clearing
Agencies and, if the Reset Rate Notes are then listed on the Luxembourg Stock
Exchange, the Luxembourg listing agent.
Appendix A-2-4
Section 5. All Hold Rate. (a) On each Remarketing Terms
Determination Date for the Reset Rate Notes which are denominated in U.S.
Dollars during both the then-current Reset Period and the immediately following
Reset Period, the Remarketing Agents, in consultation with the Administrator,
will establish the All Hold Rate for the Reset Rate Notes. With respect to the
Reset Rate Notes that are either in Foreign Exchange Mode during the
then-current Reset Period or will be reset into Foreign Exchange Mode on the
immediately following Reset Date, all Reset Rate Noteholders will be deemed to
have tendered their Notes on the Reset Date, regardless of any desire by such
Reset Rate Noteholders to retain their ownership thereof, and no All Hold Rate
will be applicable.
(b) The All Hold Rate will only be applicable if 100% of
the Reset Rate Noteholders deliver timely Hold Notices wherein they elect to
hold their Reset Rate Notes for the next Reset Period. If applicable, the
interest rate for the Reset Rate Notes during the immediately following Reset
Period will not be less than the All Hold Rate. If the rate of interest using
the Spread or fixed rate of interest established on the Spread Determination
Date is higher than the All Hold Rate, then upon a successful remarketing of the
Reset Rate Notes, all Reset Rate Noteholders who delivered a Hold Notice
agreeing to be subject to the All Hold Rate instead will be entitled to the
higher rate of interest during the immediately following Reset Period.
Section 6. Failed remarketing. (a) with respect to each Reset
Date for which the holder of the Call Option does not deliver the Call Option
Notice, a Failed Remarketing will be declared by the Remarketing Agents and the
provisions of this Section 6 will apply if any of the conditions set forth in
the definition of "Failed Remarketing" are applicable. In order to prevent the
declaration of a Failed Remarketing, the Remarketing Agents will have the
option, but not the obligation, to purchase any Reset Rate Notes tendered that
they are not otherwise able to remarket or with respect to which a committed
purchaser defaults on their purchase obligations.
(b) At any time a Failed Remarketing is declared: (i) all
Reset Rate Notes will be retained by the Reset Rate Noteholders on the related
Reset Date, regardless of any deemed mandatory or voluntary tenders made to the
Remarketing Agents, (ii) the Failed Remarketing Rate for Reset Rate Notes will
apply for the related Reset Period and (iii) a Reset Period of three months will
be established. In addition, if the Reset Rates Notes are in Foreign Exchange
Mode at the time a Failed Remarketing is declared, the provisions of Sections
10(a)(i) and (ii) shall also apply.
(c) If there is a Failed Remarketing of the Reset Rate
Notes, the Reset Rate Noteholders shall not be entitled to exercise any remedies
as a result of the failure of the Reset Rate Notes to be remarketed on the Reset
Date.
Appendix A-2-5
Section 7. Call Option. (a) With respect to each Reset Date,
the Depositor, as the initial holder of the Excess Distribution Certificate, is
hereby granted the Call Option for the purchase of not less than 100% of the
Reset Rate Notes, exercisable at a price equal to 100% of the Outstanding Amount
of the Reset Rate Notes, less all amounts distributed to the Reset Rate
Noteholders as a payment of principal with respect to the Distribution Date,
plus any accrued and unpaid interest not paid by the Trust with respect to the
applicable Reset Date.
(b) The Depositor, as the initial holder of the Excess
Distribution Certificate, effective as of the Closing Date, hereby transfers all
of its right title and interest in and to the Call Option to SLM Education
Credit Management Corporation, which upon receipt thereof will dividend all of
its right, title and interest in and to the Call Option to SLM Corporation, and
in acceptance of such transfer SLM Corporation also hereby agrees to abide by
all terms and conditions hereunder with respect to the Call Option as set forth
in these Reset Rate Note Procedures.
(c) SLM Corporation may further transfer ownership of the
Call Option at any time to one of its Affiliates, provided that such permitted
transferee has at no time in the past owned, and is not obligated under either
the Purchase Agreement or the Sale Agreement to transfer, an interest in any of
the Trust Student Loans.
(d) The Call Option may be exercised with respect to the
Reset Rate Notes at any time on or prior to the determination of the related
Spread or fixed rate or the declaration of a Failed Remarketing, as applicable,
on the related Spread Determination Date by delivery of a Call Option Notice;
provided that the Call Option may not be exercised before the day following the
last Distribution Date immediately preceding the next applicable Reset Date. In
addition, for so long as the Reset Rate Notes are listed on the Luxembourg Stock
Exchange, the holder of the Call Option shall cause a notice of the exercise of
the Call Option to be published in a leading newspaper having general
circulation in Luxembourg (which is expected to be The Luxemburger Wort). Once
written notice of the exercise of the Call Option is given, such exercise may
not be rescinded.
(e) All amounts due and owing to the Reset Rate
Noteholders shall be remitted on or before the related Reset Date by the holder
of the Call Option in accordance with the standard procedures established by the
Clearing Agencies for transfer of securities to ensure timely payment of
principal to the Reset Rate Noteholders on the Reset Date.
(f) In the event that the Call Option is exercised with
respect to the Reset Rate Notes if they are then in Foreign Exchange Mode, the
holder of the Call Option shall deliver the U.S. Dollar Equivalent Principal
Amount remaining after all payments of principal are made with respect to the
related Distribution Date, and interest (if applicable) owing to the Reset Rate
Noteholders to the Remarketing Agents for delivery to the related Swap Agents
for delivery to the Swap Counterparties to the related Reset Date Currency Swap
Agreements, who shall exchange such amount into the applicable currency for
delivery to the Reset Rate Noteholders; provided, however, that if there are no
such Reset Date Currency Swap Agreements then in effect, the holder of the Call
Option shall remit all amounts due and owing to the Remarketing Agents for
delivery to the Reset Rate Noteholders in the applicable currency on or before
the Reset Date in accordance with the standard procedures established by the
related Clearing
Appendix A-2-6
Agencies for transfer of securities to ensure timely payment of principal to the
Reset Rate Noteholders on the Reset Date.
(g) If the Call Option is exercised with respect to the Reset
Rate Notes, (i) the interest rate on the Reset Rate Notes will be the Call Rate,
(ii) the Reset Rate Notes will be denominated in U.S. Dollars and (iii) a Reset
Period of three months will be established. At the end of such three month Reset
Period, the holder of the Call Option may either remarket the Reset Rate Notes
pursuant to the remarketing procedures set forth herein and in the Remarketing
Agreement, or retain the Reset Rate Notes for one or more successive three-month
Reset Periods at the then-current Call Rate. In the event the holder of the Call
Option chooses to remarket the Reset Rate Notes, such holder shall be solely
responsible for all costs and expenses relating to the preparation of any new
offering document and any other related costs and expenses associated with such
remarketing, other than the fees of the Remarketing Agents, as more fully set
forth in Section 3 of the Remarketing Agreement.
(h) Other than in connection with the exercise of a Call
Option, neither SLM Corporation, Xxxxxx Xxx, the Trust or any of their
Affiliates shall have the ability to purchase any Reset Rate Notes tendered to
the Remarketing Agents.
Section 8. Hold Notice. If the Reset Rate Notes are
denominated in U.S. Dollars during both the then-current Reset Period and the
immediately following Reset Period, the Reset Rate Noteholders will have the
option to deliver a Hold Notice to any Remarketing Agent setting forth their
desire to hold their Reset Rate Notes for the next Reset Period at a rate of
interest not less than the All Hold Rate and on the terms set forth in the
related Remarketing Terms Notice, at any time on or after the Remarketing Terms
Determination Date until the Notice Date. Such Hold Notice may be delivered as
an oral statement to a Remarketing Agent, if subsequently confirmed in writing
within 24 hours, which confirmation may be in the form of an e-mail if timely
received by the Remarketing Agent. If a Reset Rate Noteholder does not timely
deliver a Hold Notice to a Remarketing Agent (such Hold Notice not to be
considered delivered until actually received by such Remarketing Agent), that
Reset Rate Noteholder will be deemed to have tendered for remarketing 100% of
the Outstanding Amount of the Reset Rate Notes. Any duly delivered Hold Notice
will be irrevocable, but will be subject to a mandatory tender of the Reset Rate
Notes pursuant to any exercise of the Call Option. All of the Reset Rate Notes,
whether tendered or not, will bear interest during any Reset Period on the same
terms.
Section 9. Spread Determination Date. (a) On each Spread
Determination Date, unless a Failed Remarketing has been declared or the holder
of the Call Option has delivered the Call Option Notice, the Administrator, the
Trust and the Remarketing Agents will enter into a Supplemental Remarketing
Agency Agreement.
(b) If pursuant to the Remarketing Terms Notice, the
Remarketing Agents, in consultation with the Administrator, have determined that
the Reset Rate Notes are to be reset to bear a fixed rate of interest, then the
applicable fixed rate of interest for the corresponding Reset Period will be
determined on the Spread Determination Date by adding (i) the applicable spread
as determined by the Remarketing Agents on the Spread Determination Date and
(ii) the yield to maturity on the Spread Determination Date of the applicable
fixed rate pricing benchmark, selected by the Remarketing Agents, as having an
expected weighted average life based on a
Appendix A-2-7
scheduled maturity at the next Reset Date, which would be used in accordance
with customary financial practice in pricing new issues of asset-backed
securities of comparable average life; provided that such fixed rate of interest
will in no event be lower than the related All Hold Rate, if applicable. The
Remarketing Agents shall determine the applicable fixed rate of interest for the
Reset Rate Notes (by reference to the applicable fixed rate pricing benchmark
plus or minus the spread determined on the Remarketing Terms Determination Date)
on each Spread Determination Date irrespective of whether no remarketing will
occur as the result of the application of the All Hold Rate, if applicable. In
addition, on the related Spread Determination Date, the Remarketing Agents, in
consultation with the Administrator, shall determine the Supplemental Interest
Account Deposit Amount, if any, for the Reset Rate Notes.
(c) If pursuant to the Remarketing Terms Notice, the
Remarketing Agents, in consultation with the Administrator, have determined that
the Reset Rate Notes are to be reset to bear a floating rate of interest, then,
on the related Spread Determination Date, the Remarketing Agents will establish
the applicable Spread to be added or subtracted from the applicable Index;
provided that such floating rate of interest will in no event be lower than the
related All Hold Rate, if applicable.
(d) If required pursuant to Section 2(c) above, on the related
Reset Date the Trust shall enter into either (i) one or more Cross-Currency Swap
Agreements, if the Reset Rate Notes are to be reset in Foreign Exchange Mode, or
(ii) one or more Interest Rate Swap Agreements if the Reset Rate Notes are to be
reset in U.S. Dollars and to bear interest at a fixed rate or at a floating rate
other than one based on LIBOR or a Commercial Paper Rate, with an Eligible Swap
Counterparty. In addition, if the Reset Rate Notes are to be reset in Foreign
Exchange Mode, on the Reset Date the Remarketing Agents shall cause at least one
Swap Agent to enter into one or more Reset Date Currency Swap Agreements with
one or more Eligible Swap Counterparties.
(e) On or immediately following the Spread Determination Date,
the Remarketing Agents will communicate in writing (including facsimile or other
electronic transmission if in accordance with each Clearing Agency's standard
procedures) the contents of the Spread Determination Notice to each Clearing
Agency (and the Luxembourg Stock Exchange if the Reset Rate Notes are then
listed on such exchange) or the Reset Rate Noteholders if Definitive Notes have
been issued, as applicable, with instructions to distribute such notices to its
related participants, or to the Reset Rate Noteholders, as applicable, the
Indenture Trustee and the Rating Agencies. The Spread Determination Notice will
contain: (i) the determined Spread or fixed rate of interest, as the case may
be, or, if applicable, a statement that the All Hold Rate or the Failed
Remarketing Rate will be in effect for the immediately following Reset Period,
(ii) any applicable currency exchange rate, (iii) the identity of any selected
Swap Counterparty or Counterparties, and Swap Agent or Agents, if applicable,
(iv) if applicable, the floating rate (or rates) of interest to be due to each
selected Swap Counterparty with respect to each Distribution Date during the
immediately following Reset Period and (v) any other information that the
Administrator or the Remarketing Agents deem applicable. Furthermore, for the
Reset Rate Notes to be reset in Foreign Exchange Mode, the currency exchange
rate, the Extension Rate due to each related Cross-Currency Swap Counterparty
and the Failed Remarketing Rate for the immediately following Reset Period will
be determined pursuant to the terms of the related Cross-Currency Swap Agreement
and contained in the Spread Determination Notice. In
Appendix A-2-8
addition, if required for the immediately following Reset Period, on or before
the related Spread Determination Date the Administrator will arrange for new or
additional securities identification codes to be obtained as required.
Section 10. Swap Agreements: (a) If the Reset Rate Notes are
to be reset in Foreign Exchange Mode, on the Reset Date, the Administrator will
enter into (not in its individual capacity, but solely as Administrator on
behalf of the Trust) or will instruct the Eligible Lender Trustee to enter into
(not in its individual capacity, but solely as Eligible Lender Trustee) one or
more Cross-Currency Swap Agreements for the Reset Period.
(i) Each Cross-Currency Swap Counterparty (including, without
limitation, the Initial Cross-Currency Swap Counterparty) which is party to a
related Cross-Currency Swap Agreement will be entitled to receive with respect
to each Distribution Date, (x) an interest rate of Three-Month LIBOR, plus or
minus a spread, as determined from the bidding process described in Section
10(d) below (other than as may be interpolated for an initial or final
calculation period under that Cross-Currency Swap Agreement), multiplied by the
U.S. Dollar Equivalent Principal Amount of the Reset Rate Notes, and multiplied
by a fraction determined by the number of days in the applicable Accrual Period
and the applicable Day Count Basis, (y) all payments of principal in U.S.
Dollars that are allocated to the Reset Rate Notes; provided that if the Reset
Rate Notes bear a fixed rate of interest, all principal payments allocated to
the Reset Rate Notes on any Distribution Date will be deposited into the
Accumulation Account and paid to the related Swap Counterparties on or about the
next Reset Date as set forth in the related Cross-Currency Swap Agreements
(including all sums required to be deposited therein on the Reset Date), but
excluding all Investment Earnings thereon. With respect to the Initial
Cross-Currency Swap Agreement, the Initial Swap Counterparty also shall be
entitled to receive on the Closing Date, all applicable non-U.S. Dollar currency
proceeds received by the Trust from purchasers of the Reset Rate Notes (which
shall be net of any underwriting commission or discount owing to the initial
purchasers of such Notes).
(ii) In addition, each related Cross-Currency Swap
Counterparty will be obligated to pay to the Trust (for payment to the Reset
Rate Noteholders, if applicable): (x) on the Closing Date and with respect to
the Initial Cross-Currency Swap Agreement only, the U.S. Dollar Equivalent
Principal Amount of the applicable non-U.S. Dollar currency paid to such
Cross-Currency Swap Counterparty by the Trust; (y) with respect to each
applicable Distribution Date, (A) their applicable percentage of the applicable
rate of interest on the Reset Rate Notes multiplied by the U.S. Dollar
Equivalent Principal Amount of the Reset Rate Notes and multiplied by a fraction
determined by the number of days in the applicable Accrual Period and the
applicable Day Count Basis, and (B) the applicable non-U.S. Dollar currency
equivalent of the U.S. Dollars such Swap Counterparty concurrently receives from
the Trust as a payment of principal allocated to the Reset Rate Noteholders
(including, on the Maturity Date for the Reset Rate Notes, if a Cross-Currency
Swap Agreement is then in effect, the remaining Outstanding Amount of the Reset
Rate Notes) but only to the extent that the required U.S. Dollar Equivalent
Principal Amount is received from the Trust on such date, at an exchange rate to
be set on the effective date of and set forth in the related Cross-Currency Swap
Agreement; and (z) on the second Business Day following a Distribution Date that
is also a Reset Date (other than for any Reset Period following a Reset Date
upon which a Failed Remarketing has occurred, up to and including the Reset Date
resulting in a successful remarketing or an exercise of the Call Option)
Appendix A-2-9
their applicable percentage of interest at the interest rate from and including
the Reset Date to, but excluding, the second Business Day following such Reset
Date. For any Reset Period following a Reset Date upon which a Failed
Remarketing has occurred, up to any including the Reset Date resulting in a
successful remarketing or an exercise of the Call Option for the Reset Rate
Notes, payments of interest and principal to the Reset Rate Noteholders will be
made on the second Business Day following the Reset Date without the payment of
any additional interest.
(b) In addition, if the Reset Rate Notes are to be reset in
Foreign Exchange Mode, on the Reset Date, the Remarketing Agents will appoint
one or more Swap Agents and cause such Swap Agents to enter into one or more
Reset Date Currency Swap Agreements with Eligible Swap Counterparties for the
next Reset Period. Each Reset Date Currency Swap Agreement will share the same
currency exchange rate as the related Cross-Currency Swap Agreement.
(i) On the effective date of any Reset Date Currency Swap
Agreement (except with respect to the Initial Reset Date Currency Swap
Agreements), (A) the Remarketing Agents will deliver to each Swap Agent, for
further delivery to the related Swap Counterparty, its percentage of all
secondary trade sale proceeds received from purchasers of the Reset Rate Notes
in the applicable non-U.S. Dollar currency, and (B) in return, the related Swap
Counterparty will deliver to the related Swap Agent, for delivery to the
Remarketing Agents, the U.S. Dollar equivalent of such sale proceeds using the
conversion rate established on the applicable effective date. Upon receipt, the
Remarketing Agents will then deliver such sums either (1) to the tendering Reset
Rate Noteholders, if the Reset Rate Notes were denominated in U.S. Dollars
immediately prior to such Reset Date, as payment in full of the Outstanding
Amount of the Reset Rate Notes, or (2) if the Reset Rate Notes were in Foreign
Exchange Mode immediately prior to such Reset Date, to the related Swap Agent
for the Reset Date Currency Swap Agreement in effect for the Reset Period ending
on such Reset Date for the purposes described in subparagraph (ii) below.
(ii) On the Reset Date corresponding to the successful
remarketing of the Reset Rate Notes, (A) each Swap Agent for the related Reset
Date Currency Swap Agreement in effect for the Reset Period ending on such Reset
Date will be obligated to deliver to the related Swap Counterparty for the
related Reset Date Currency Swap Agreement in effect for the Reset Period ending
on such Reset Date, its percentage of all U.S. Dollar secondary trade sale
proceeds received from the Remarketing Agents that the Remarketing Agents either
received directly from the purchasers of such Reset Rate Notes (if remarketed in
U.S. Dollars) or from such Swap Agent with respect to the related Reset Date
Currency Swap Agreement commencing on such Reset Date (if remarketed in Foreign
Exchange Mode, as described in subparagraph (i) above), and (B) in return, the
related Swap Counterparty for the related Reset Date Currency Swap Agreement in
effect for the Reset Period ending on such Reset Date will deliver to the
related Swap Agent for the related Reset Date Currency Swap Agreement in effect
for the Reset Period ending on such Reset Date, for delivery to the Remarketing
Agents, the non-U.S. Dollar currency equivalent of such secondary trade sale
proceeds, using the exchange rate set forth in such Reset Date Currency Swap
Agreement (or in the case of the Initial Reset Date Currency Swap Agreement, the
Closing Date). The Remarketing Agents will then deliver such non-U.S. Dollar
currency amounts to the tendering Reset Rate Noteholders, as payment in full of
the Outstanding
Appendix A-2-10
Amount of their Reset Rate Notes, and the Reset Date Currency Swap Agreement
effective during the previous Reset Period will terminate in accordance with its
terms.
(c) If the Reset Rate Notes are to be reset in U.S. Dollars,
and a Swap Agreement is required pursuant to Sections 2(c) and 9(d) above, then
the Administrator will enter into (not in its individual capacity, but solely as
Administrator on behalf of the Trust) or will instruct the Eligible Lender
Trustee to enter into (not in its individual capacity, but solely as Eligible
Lender Trustee), one or more Interest Rate Swap Agreements for the next Reset
Period to facilitate the Trust's ability to pay applicable interest at the
related interest rate.
(i) Each Swap Counterparty which is party to a related
Interest Rate Swap Agreement will be entitled to receive on each Distribution
Date an interest rate of Three-Month LIBOR, plus or minus a spread, as
determined from the bidding process described in Section 10(d) below, multiplied
by the Outstanding Amount of the Reset Rate Notes and multiplied by a fraction
determined by the number of days in the applicable Accrual Period and the
applicable Day Count Basis.
(ii) In addition, each related Swap Counterparty which is a
party to a related Interest Rate Swap Agreement will be obligated to pay to the
Trust on each Distribution Date, the applicable rate of interest on the Reset
Rate Notes multiplied by the Outstanding Amount of the Reset Rate Notes and
multiplied by a fraction determined by the number of days in the applicable
Accrual Period and the applicable Day Count Basis.
(d) Other than with respect to the Initial Swap Agreements,
the Remarketing Agents, in consultation with the Administrator, in determining
the Swap Counterparty to each required Swap Agreement, will solicit bids from at
least three Eligible Swap Counterparties and will select the lowest of these
bids to provide the interest rate swap and/or currency exchange swap(s). If the
lowest bidder specifies a notional amount that is less than the Outstanding
Amount of the Reset Rate Notes, the Remarketing Agents, in consultation with the
Administrator, may select more than one Eligible Swap Counterparty, but only to
the extent that such additional Eligible Swap Counterparties have provided the
next lowest received bid or bids, and enter into more than one Swap Agreement
that result in the Rating Agency Condition being satisfied. On or before the
Spread Determination Date, the Remarketing Agents, in consultation with the
Administrator, will select the Swap Counterparty or Counterparties and any
related Swap Agents and will cause any such Swap Agent or Swap Agents to enter
into the required Swap Agreements on the Reset Date for the upcoming Reset
Period.
(e) Other than with respect to the Initial Swap Agreements, it
is a condition precedent to the entering into of any Swap Agreement and the
setting of the amount to be paid to the related Swap Counterparty that the
Rating Agency Condition is satisfied. No Swap Agreement will be entered into or
caused to be entered into by the Trust, the Administrator on its behalf, the
Remarketing Agents or a Swap Agent on their behalf, for any Reset Period where
either the Call Option has been exercised or a Failed Remarketing has been
declared.
(f) Each Cross-Currency Swap Agreement and each Reset Date
Currency Swap Agreement will terminate at the earliest to occur of (i) the next
succeeding Reset Date for which there is a successful remarketing, (ii) the
Reset Date for which the Call Option is
Appendix A-2-11
exercised, (iii) the Distribution Date on which the Outstanding Amount of the
Reset Rate Notes are reduced to zero (including as the result of the optional
purchase of the remaining Trust Student Loans by the Servicer or an auction of
the Trust Student Loans by the Indenture Trustee) or (iv) the Maturity Date of
the Reset Rate Notes. No Cross-Currency Swap Agreement or Reset Date Currency
Swap Agreement will terminate solely due to the declaration of a Failed
Remarketing. Each Interest Rate Swap Agreement will terminate on the earliest to
occur of the next Reset Date, or the occurrence of an event specified in clause
(ii), (iii) or (iv) above.
(g) With respect to each Cross-Currency Swap Agreement, and in
the event that a Failed Remarketing is declared, the rate of interest due to
each related Cross-Currency Swap Counterparty from the Trust on each
Distribution Date will be increased to the Extension Rate and the rate due to
the Trust from each related Cross-Currency Swap Counterparty will change to
equal the Failed Remarketing Rate.
Section 11. Accumulation Account; Supplemental Interest
Account. (a) If, on any Distribution Date, principal would be payable to the
Reset Rate Notes which are then bearing interest at a fixed rate (including
without limitation during the initial Reset Period), that principal (subject to
sufficient Available Funds therefor) will be allocated to the Reset Rate Notes
and deposited into the Accumulation Account, where it will remain until the next
Reset Date (except that if the Reset Rate Notes are in Foreign Exchange Mode,
principal will be paid according to the provisions of Sections 10(a)(i) and
(a)(ii) above), unless an Event of Default under the Indenture or a sale of the
Trust Estate pursuant to Section 6.1 of the Administration Agreement has
occurred (in which case the Indenture Trustee will distribute all sums on
deposit therein (exclusive of Investment Earnings) to the Reset Rate Noteholders
in accordance with the provisions of Section 5.4(b) of the Indenture or Section
6.1 of the Administration Agreement, as applicable).
(b) On each Reset Date, if the Reset Rate Notes bore interest
at a fixed rate during the preceding Reset Period (including without limitation,
on the Initial Reset Date), all sums, if any, then on deposit in the
Accumulation Account, including any allocation of principal made on the same
date, but less any Investment Earnings, will be distributed by the Indenture
Trustee, at the direction of the Administrator, as set forth in Section 2.8 of
the Administration Agreement, (x) to the holders of the Reset Rate Notes, as of
the Record Date, or (y) if the Reset Rate Notes are in Foreign Exchange Mode
(including during the initial Reset Period), to the related Cross-Currency Swap
Counterparty or Counterparties for the benefit of such Reset Rate Noteholders as
of the Record Date pursuant to the provisions of Section 10(a)(i) and (a)(ii)
above, in reduction of principal of the Reset Rate Notes; provided, that, in the
event on any Distribution Date the amount on deposit in the Accumulation Account
(excluding any Investment Earnings) would equal the Outstanding Amount of the
Reset Rate Notes, no additional amounts will be deposited into the Accumulation
Account and all amounts therein, less any Investment Earnings, will be
distributed by the Indenture Trustee, at the direction of the Administrator, as
set forth in Section 2.8 of the Administration Agreement, on the next Reset Date
to the Reset Rate Noteholders or the related Cross-Currency Swap Counterparty or
Counterparties (as applicable), and on such Reset Date the Reset Rate Notes will
no longer be Outstanding. Amounts on deposit in an Accumulation Account
(exclusive of Investment Earnings) may be used only to pay principal on the
Reset Rate Notes (or to the related Cross-Currency Swap Counterparty or
Counterparties) and for no other purpose. On each Distribution
Appendix A-2-12
Date, all Investment Earnings on deposit in the Accumulation Account will be
withdrawn by the Indenture Trustee, at the direction of the Administrator and
deposited into the Collection Account.
(c) The Indenture Trustee, subject to sufficient available
funds therefor, at the direction of the Administrator and pursuant to Section
2.10(d)(ii) of the Administration Agreement, will deposit into the Supplemental
Interest Account, the related Supplemental Interest Account Deposit Amount. On
each Distribution Date, all sums (which shall include Investment Earnings) on
deposit in the Supplemental Interest Account will be withdrawn by the Indenture
Trustee, at the direction of the Administrator, as set forth in Section
2.10(d)(iii) of the Administration Agreement, and deposited into the Collection
Account.
Section 12. Remarketing Agents; Swap Agent; Remarketing Fee
Account. (a) The initial Remarketing Agents, appointed pursuant to the terms of
the Remarketing Agreement, are Citigroup Global Markets Inc., Credit Suisse
First Boston LLC and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated. The
terms and conditions of the Remarketing Agreement will govern the duties and
obligations of the Remarketing Agents and each Swap Agent. The Administrator,
the Trust and the Remarketing Agents will enter into on each (A) Remarketing
Terms Determination Date, a Remarketing Agency Agreement, in form and substance
substantially the same as Appendix B to the Remarketing Agreement, unless (i) a
Failed Remarketing is declared, or (ii) the holder of the Call Option has
delivered the Call Option Notice on or prior to such date; and (B) Spread
Determination Date, a Supplemental Remarketing Agency Agreement, in form and
substance substantially the same as Appendix C to the Remarketing Agreement,
unless (i) a Failed Remarketing is declared, (ii) the holder of the Call Option
has delivered the Call Option Notice on or prior to such date, or (iii) if
applicable, 100% of the Reset Rate Noteholders have timely delivered a Hold
Notice and the All Hold Rate will apply for the next Reset Period.
(b) If the Reset Rate Notes are in Foreign Exchange Mode or
will be reset into Foreign Exchange Mode, then pursuant to Section 13 of the
Remarketing Agreement, the Remarketing Agents shall appoint one or more Swap
Agents to act as agent for the Remarketing Agent and for the benefit of the
Reset Rate Noteholders, and instruct each Swap Agent to enter into a Reset Date
Currency Swap Agreement. The initial Swap Agent, appointed by the Remarketing
Agents pursuant to the Remarketing Agreement, is Citibank, N.A. The initial Swap
Agents shall be entitled to receive their pro rata share of the Remarketing
Agents' Upfront Fee paid to the Remarketing Agents pursuant to Section 3(c) of
the Remarketing Agreement. The duties and obligations of the Swap Agent are set
forth in the Remarketing Agreement.
(c) Excluding all Reset Rate Notes for which a Remarketing
Agent has received a timely delivered Hold Notice, if applicable (or if the
holder of the Call Option has delivered the related Call Option Notice), on the
Reset Date that commences each Reset Period, each Reset Rate Note will be
automatically tendered, or deemed tendered, to the relevant Remarketing Agent
for remarketing by such Remarketing Agent on the Reset Date at 100% of its
Outstanding Amount. If the Reset Rate Notes are held in book-entry form, 100% of
the Outstanding Amount of such Reset Rate Notes will be paid by the Remarketing
Agents in accordance with the standard procedures of the applicable Clearing
Agencies.
Appendix A-2-13
(d) The Remarketing Agents will attempt, on a reasonable
efforts basis and in accordance with the terms and conditions of the Remarketing
Agreement and the related Remarketing Agency Agreement, to remarket the tendered
Reset Rate Notes at a price equal to 100% of the Outstanding Amount of the Reset
Rate Notes so tendered.
(e) Purchasers of the Reset Rate Notes will be credited with
their positions on the Reset Date with respect to positions held through DTC or
on the next Business Day with respect to positions held through the European
Clearing Systems. No payment delay to existing Reset Rate Noteholders holding
U.S. Dollar-denominated Reset Rate Notes through DTC will occur on the Reset
Date for such Reset Rate Notes denominated in U.S. Dollars during the
immediately following Reset Period.
(f) Each of the Remarketing Agents, in its individual or any
other capacity, may buy, sell, hold and deal in the Reset Rate Notes, including,
but not limited to, purchasing any tendered Reset Rate Notes as part of the
remarketing process. Any Remarketing Agent that owns a Reset Rate Note may
exercise any vote or join in any action which any beneficial owner of the Reset
Rate Notes may be entitled to exercise or take with like effect as if it did not
act in any capacity under the Remarketing Agreement or Remarketing Agency
Agreement. Any Remarketing Agent, in its individual capacity, either as
principal or agent, may also engage in or have an interest in any financial or
other transaction with the Trust, the Depositor, the Servicer, the Indenture
Trustee (in its individual capacity), the Eligible Lender Trustee (in its
individual capacity) or the Administrator as freely as if it did not act in any
capacity under the Remarketing Agreement or any Remarketing Agency Agreement. No
Reset Rate Noteholder or beneficial owner of any Reset Rate Note will have any
rights or claims against any Remarketing Agent as a result of such Remarketing
Agent's not purchasing any tendered Reset Rate Note, which results in the
declaration of a Failed Remarketing.
(g) Each of the Remarketing Agents will be entitled to receive
a fee in connection with their services rendered for each successful remarketing
of the Reset Rate Notes in the amount set forth in the Remarketing Agreement and
the related Remarketing Agency Agreement. Subject to the terms and conditions
set forth in the Remarketing Agreement, the Administrator, in its sole
discretion, may change the Remarketing Agents for the Reset Rate Notes for any
Reset Period at any time on or before the related Remarketing Terms
Determination Date. In addition, the Administrator will appoint one or more
additional Remarketing Agents, if necessary, for a Reset Date when the Reset
Rate Notes will be remarketed in a non-U.S. Dollar currency. Furthermore, a
Remarketing Agent may resign at any time; provided that no resignation may
become effective on a date that is later than 15 Business Days prior to a
Remarketing Terms Determination Date.
(h) In accordance with Section 2.3(i) of the Administration
Agreement, on the Closing Date, the Trust will establish the Remarketing Fee
Account as an asset of the Trust in the name of the Indenture Trustee for the
benefit of the Remarketing Agents and the Reset Rate Noteholders. The fees
associated with each successful remarketing will be payable directly to the
Remarketing Agents from amounts on deposit from time to time in the Remarketing
Fee Account. On each applicable Distribution Date, Available Funds will be
deposited into the Remarketing Fee Account, in the priority set forth in Section
2.8(c) of the Administration Agreement, in an amount up to the Quarterly Funding
Amount; provided, that if the amount on
Appendix A-2-14
deposit in the Remarketing Fee Account, after the payment of any remarketing
fees therefrom, exceeds the sum of the Reset Period Target Amount for all Reset
Rate Notes, such excess will be withdrawn on the related Distribution Date,
deposited into the Collection Account and included in Available Funds for that
Distribution Date. All Investments Earnings on deposit in the Remarketing Fee
Account will be withdrawn on the next Distribution Date, deposited into the
Collection Account and included in Available Funds for that Distribution Date.
In the event that the fees owed to any Remarketing Agent on a Reset Date exceeds
the amount then on deposit in the Remarketing Fee Account, such shortfall shall
be paid from Available Funds on future Distribution Dates in the priority set
forth in Section 2.8(n) of the Administration Agreement. The Trust shall also be
responsible for certain remarketing costs and expenses to the extent set forth
in Section 3 of the Remarketing Agreement, which shall be paid on each
Distribution Date, to the extent of Available Funds, at the priority set forth
in Section 2.8(o) of the Administration Agreement.
Section 13. Eligible Lender Trustee. The Eligible Lender
Trustee is hereby authorized and directed to execute and deliver, not in its
individual capacity, but solely as Eligible Lender Trustee on behalf of the
Trust, the Remarketing Agreement, any Swap Agreements, and all Remarketing
Agency Agreements and Supplemental Remarketing Agency Agreements as the
Administrator, in writing and from time to time, shall instruct the Eligible
Lender Trustee to execute. The Eligible Lender Trustee shall not be liable to
any party, any third party or any Noteholder for any such actions taken at the
written instruction of the Administrator. Notwithstanding the foregoing, in the
event that the Eligible Lender Trustee declines or fails to execute or deliver
any such document, instrument, certificate or agreement as instructed by the
Administrator, the Administrator is hereby authorized, in its sole discretion,
to execute and deliver, not in its individual capacity but solely as
Administrator on behalf of the Trust, all such required documents, instruments,
certificates and agreements. The foregoing authorization shall represent a
limited power of attorney granted by the Trust to the Administrator to act on
its behalf, and the Administrator shall not be liable to any party, any third
party or any Noteholder for any such actions taken in good faith and in
accordance with these Reset Rate Note Procedures.
Appendix X-0-00
XXXXXXXX X-0
TRANSFER RESTRICTIONS FOR
THE RESET RATE NOTES
1. Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined in this
Appendix A-3 (this "Appendix") are defined in Xxxxxxxx X-0, which also contains
rules as to usage that shall be applicable herein.
2. The Indenture Trustee, as Note Registrar, shall provide for
the registration of the Reset Rate Notes and of Transfers and exchanges of the
Reset Rate Notes pursuant to Section 2.4 of the Indenture.
3. The Reset Rate Notes will be initially represented by
registered notes of such class in global form and shall be issued in the manner
set forth in Sections 2.1, 2.2 and 2.10 of the Indenture. The global notes may
be reissued and represented by Reset Rate Notes of such class in definitive form
pursuant to Section 2.12 of the Indenture.
4. Any Transfer made in violation of Section 2.1 of the
Indenture of Reset Rate Notes that represent a beneficial interest in a U.S.
Rule 144A Global Note Certificate (as defined in Section 2.1 of the Indenture)
such that the beneficial interest is then held in either of the related Non-U.S.
Global Note Certificates (as defined in Section 2.1 of the Indenture), or vice
versa (other than on a Reset Date where such class is being reset from being
denominated in U.S. Dollars to Foreign Exchange Mode, or vice versa), shall be
null and void and of no effect.
5. Each purchaser of the Reset Rate Notes that represent a
beneficial interest in a Global Note Certificate will be deemed to have
represented and agreed, and each purchaser of a Definitive Note will be required
to certify in writing, that:
(i) (A) the purchaser is a QIB and is acquiring such Reset
Rate Notes for its own account or as a fiduciary or agent for others
(which others also must be QIBs), for investment purposes and not for
distribution in violation of the Act, and it is able to bear the
economic risk of an investment in the Reset Rate Notes and has such
knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of purchasing the Reset Rate
Notes or (B) the purchaser is a non-U.S. Person (as defined in
Regulation S) outside the United States of America, acquiring the Reset
Rate Notes pursuant to an exemption from registration in accordance
with Rule 903 or Rule 904 of Regulation S;
(ii) the purchaser understands that the Reset Rate Notes are
being offered only in a transaction that does not require registration
under the Act and, if such purchaser decides to resell or otherwise
Transfer such Reset Rate Notes, then it agrees that it will resell or
Transfer such Reset Rate Notes only (A) so long as such Reset Rate
Notes are eligible for resale pursuant to Rule 144A, to a person whom
the seller reasonably believes is a QIB acquiring the Reset Rate Notes
for its own account or as a fiduciary or agent for others (which others
must also be QIBs) to whom notice is given that the resale or other
Appendix A-3-1
Transfer is being made in reliance on Rule 144A, (B) pursuant to an
effective registration statement under the Act, (C) pursuant to an
exemption from registration available under the Act other than Rule
144A, or (D) to a purchaser who is a non-U.S. Person (as defined in
Regulation S) outside the United States of America, acquiring the Reset
Rate Notes pursuant to an exemption from registration under the Act in
accordance with Rule 903 or Rule 904 of Regulation S, in each case in
accordance with any applicable United States state securities or "blue
sky" laws or any securities laws of any other jurisdiction;
(iii) unless the relevant legend set out below has been
removed from the Reset Rate Notes such purchaser shall notify each
transferee of the Reset Rate Notes that (A) such Reset Rate Notes have
not been registered under the Act, (B) the holder of such Reset Rate
Notes is subject to the restrictions on the resale or other Transfer
thereof described in paragraph (ii) above, (C) such transferee shall be
deemed to have represented (1) as to its status as a QIB or a purchaser
acquiring the Reset Rate Notes in an offshore transaction pursuant to
the requirements of Regulation S, as the case may be, (2) if such
transferee is a QIB, that such transferee is acquiring the Reset Rate
Notes for its own account or as a fiduciary or agent for others (which
others also must be QIBs) (or that such transferee is acquiring such
Reset Rate Notes in reliance on an exemption under the Act other than
Rule 144A or pursuant to an effective registration statement under the
Act), (3) if such transferee is a non-U.S. Person (as defined in
Regulation S) outside the United States of America, that such
transferee is acquiring the Reset Rate Notes pursuant to an exemption
from registration under the Act in accordance with the requirements of
Rule 903 or Rule 904 of Regulation S, (4) that such transferee is not
an underwriter within the meaning of Section 2(11) of the Act, and (5)
that such transferee shall be deemed to have agreed to notify its
subsequent transferees as to the foregoing;
(iv) the acquisition or purchase by an employee benefit plan
or other retirement arrangements ("Plan") of a Reset Rate Note will not
constitute or otherwise result in: (A) in the case of a Plan subject to
Section 406 of Employee Retirement Income Security Act of 1974, as
amended ("ERISA") or Section 4975 of the Internal Revenue Code of 1986,
as amended ("Code"), a non-exempt prohibited transaction in violation
of Section 406 of ERISA or Section 4975 of the Code which is not
covered by a class or other applicable exemption and (B) in the case of
a Plan subject to a substantially similar federal, state, local or
foreign law ("Similar Law"), a non-exempt violation of such
substantially Similar Law.
6. By acceptance of a Reset Rate Note, whether upon original
issuance or subsequent Transfer, each Reset Rate Noteholder or Note Owner, as
applicable, of such Reset Rate Note (or a beneficial interest therein) offered
and sold only to a QIB in reliance on Rule 144A, acknowledges or is deemed to
acknowledge, as the case may be, the restrictions on the Transfer of such Reset
Rate Notes and that the following securities legend (the "Rule 144A Securities
Legend") shall be affixed to each U.S. Rule 144A Global Note Certificate (as
defined in Section 2.1 of the Indenture), Non-U.S. Rule 144A Global Note
Certificate (as defined in Section 2.1 of the Indenture) and each Definitive
Note representing an interest in either certificate (collectively, the "Rule
144A Certificates") unless determined otherwise in accordance with applicable
law:
Appendix A-3-2
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), ANY UNITED STATES STATE SECURITIES OR "BLUE
SKY" LAWS OR ANY SECURITIES LAWS OF ANY OTHER JURISDICTION,
AND, AS A MATTER OF U.S. LAW, MAY NOT BE OFFERED OR SOLD IN
VIOLATION OF THE SECURITIES ACT OR SUCH OTHER LAWS. THIS NOTE
MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF NOT LESS
THAN $250,000, L 100,000, E 100,000 OR THE APPLICABLE
CURRENCY EQUIVALENT OF $250,000, DEPENDING ON ITS CURRENCY OF
DENOMINATION. THE HOLDER HEREOF, BY PURCHASING OR ACCEPTING
THIS NOTE IS HEREBY DEEMED TO HAVE AGREED FOR THE BENEFIT OF
THE TRUST AND THE INITIAL PURCHASERS THAT IT WILL RESELL,
PLEDGE OR OTHERWISE TRANSFER THIS NOTE, AS A MATTER OF U.S.
LAW, ONLY (A) (1) SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE,
PURSUANT TO RULE 144A PROMULGATED UNDER THE SECURITIES ACT
("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY BELIEVES
IS A QUALIFIED INSTITUTIONAL BUYER, AS DEFINED IN RULE 144A (A
"QUALIFIED INSTITUTIONAL BUYER"), THAT IS ACQUIRING THIS NOTE
FOR ITS OWN ACCOUNT OR AS A FIDUCIARY OR AGENT FOR OTHERS
(WHICH OTHERS MUST ALSO BE QUALIFIED INSTITUTIONAL BUYERS) TO
WHOM NOTICE IS GIVEN THAT THE RESALE OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OTHER
THAN RULE 144A, (3) TO A PERSON WHO IS NOT A U.S. PERSON (AS
DEFINED IN REGULATION S PROMULGATED UNDER THE SECURITIES ACT)
OUTSIDE THE UNITED STATES OF AMERICA ACQUIRING THIS NOTE IN
ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S
PROMULGATED UNDER THE SECURITIES ACT OR (4) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH CASE IN ACCORDANCE WITH ANY UNITED STATES STATE
SECURITIES OR "BLUE SKY" LAWS OR ANY SECURITIES LAWS OF ANY
OTHER JURISDICTION. UPON ACQUISITION OR TRANSFER OF A CLASS
A-6 NOTE OR A BENEFICIAL INTEREST IN A CLASS A-6 NOTE, AS THE
CASE MAY BE, BY, FOR OR WITH THE ASSETS OF, AN EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT
Appendix A-3-3
ARRANGEMENT (A "PLAN"), SUCH CLASS A-6 NOTE OWNER SHALL BE
DEEMED TO HAVE REPRESENTED THAT SUCH ACQUISITION OR PURCHASE
WILL NOT CONSTITUTE OR OTHERWISE RESULT IN: (I) IN THE CASE OF
A PLAN SUBJECT TO SECTION 406 OF EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF
THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), A
NON-EXEMPT PROHIBITED TRANSACTION IN VIOLATION OF SECTION 406
OF ERISA OR SECTION 4975 OF THE CODE WHICH IS NOT COVERED BY A
CLASS OR OTHER APPLICABLE EXEMPTION AND (II) IN THE CASE OF A
PLAN SUBJECT TO A SUBSTANTIALLY SIMILAR FEDERAL, STATE, LOCAL
OR FOREIGN LAW ("SIMILAR LAW"), A NON-EXEMPT VIOLATION OF SUCH
SUBSTANTIALLY SIMILAR LAW. ANY TRANSFER FOUND TO HAVE BEEN
MADE IN VIOLATION OF SUCH DEEMED REPRESENTATION SHALL BE NULL
AND VOID AND OF NO EFFECT.
THIS NOTE AND RELATED DOCUMENTATION MAY BE AMENDED OR
SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON
AND PROCEDURES UNDERTAKEN OR REPRESENTED BY THE HOLDER, FOR
RESALES AND OTHER TRANSFERS OF THIS NOTE, TO REFLECT ANY
CHANGE IN APPLICABLE LAWS OR REGULATIONS (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO RESALES OR
OTHER TRANSFERS OF RESTRICTED SECURITIES GENERALLY. THE HOLDER
OF THIS NOTE AND ANY BENEFICIAL OWNER OF ANY INTEREST THEREIN
SHALL BE DEEMED, BY ITS ACCEPTANCE OR PURCHASE HEREOF, TO HAVE
AGREED TO ANY SUCH AMENDMENT OR SUPPLEMENT (EACH OF WHICH
SHALL BE CONCLUSIVE AND BINDING ON THE HOLDER HEREOF AND ALL
FUTURE HOLDERS OF THIS NOTE AND ANY CLASS A-6 NOTES ISSUED IN
EXCHANGE OR SUBSTITUTION HEREFOR, WHETHER OR NOT ANY NOTATION
THEREOF IS MADE HEREON) AND AGREES TO TRANSFER THIS NOTE ONLY
IN ACCORDANCE WITH ANY SUCH AMENDMENT OR SUPPLEMENT IN
ACCORDANCE WITH APPLICABLE LAW IN EFFECT AT THE DATE OF SUCH
TRANSFER.
(B) Each Reset Rate Noteholder or Note Owner, as
applicable, of the Reset Rate Notes (or a beneficial interest
therein) offered and sold only to a non-U.S. Person (as
defined in Regulation S) outside the United States of America
in reliance on Regulation S acknowledges or is deemed to
acknowledge, as the case
Appendix A-3-4
may be, the restrictions on the Transfer of such Reset Rate
Notes and that the following securities legend (the
"Regulation S Securities Legend" and with the Rule 144A
Securities Legend, the "Securities Legends" and each a
"Securities Legend") shall be affixed to each Regulation S
Global Note Certificate (as defined in Section 2.1 of the
Indenture) and each Definitive Note representing an interest
in such certificate (collectively, the "Regulation S
Certificates") unless determined otherwise in accordance with
applicable law:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), ANY
UNITED STATES STATE SECURITIES OR "BLUE SKY" LAWS OR ANY
SECURITIES LAWS OF ANY OTHER JURISDICTION, AND, AS A MATTER OF
U.S. LAW, PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER OF
THE COMMENCEMENT OF THE OFFERING OF THE CLASS A-6 NOTES AND
THE CLOSING OF THE OFFERING OF THE CLASS A-6 NOTES MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE UNITED
STATES OF AMERICA OR TO A U.S. PERSON (AS DEFINED IN
REGULATION S PROMULGATED UNDER THE SECURITIES ACT) EXCEPT
PURSUANT TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
THE SECURITIES ACT OR PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE
WITH ANY APPLICABLE SECURITIES LAWS OF ANY UNITED STATES STATE
SECURITIES OR "BLUE SKY" LAWS OR ANY SECURITIES LAWS OF ANY
OTHER JURISDICTION. THIS NOTE MAY BE TRANSFERRED ONLY IN
MINIMUM DENOMINATIONS OF NOT LESS THAN $250,000,
L 100,000, E 100,000 OR THE APPLICABLE CURRENCY
EQUIVALENT OF $250,000, DEPENDING ON ITS CURRENCY OF
DENOMINATION.
UPON ACQUISITION OR TRANSFER OF A CLASS A-6 NOTE OR A
BENEFICIAL INTEREST IN A CLASS A-6 NOTE, AS THE CASE MAY BE,
BY, FOR OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT (A "PLAN"), SUCH CLASS A-6 NOTE
OWNER SHALL BE DEEMED TO HAVE REPRESENTED THAT SUCH
ACQUISITION OR PURCHASE WILL NOT CONSTITUTE OR OTHERWISE
RESULT IN: (I) IN THE CASE OF A PLAN SUBJECT TO SECTION 406 OF
EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED
("ERISA") OR SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE
Appendix A-3-5
"CODE"), A NON-EXEMPT PROHIBITED TRANSACTION IN VIOLATION OF
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE WHICH IS NOT
COVERED BY A CLASS OR OTHER APPLICABLE EXEMPTION AND (II) IN
THE CASE OF A PLAN SUBJECT TO A SUBSTANTIALLY SIMILAR FEDERAL,
STATE, LOCAL OR FOREIGN LAW ("SIMILAR LAW"), A NON-EXEMPT
VIOLATION OF SUCH SUBSTANTIALLY SIMILAR LAW. ANY TRANSFER
FOUND TO HAVE BEEN MADE IN VIOLATION OF SUCH DEEMED
REPRESENTATION SHALL BE NULL AND VOID AND OF NO EFFECT.
Upon the Transfer, exchange or replacement of a Rule 144A
Certificate or a Regulation S Certificate bearing the applicable legends set
forth above, or upon specific request for removal of the legends, the Trust or
the Registrar will deliver only replacement Rule 144A Certificates or Regulation
S Certificates, as the case may be, that bear such applicable legends, or will
refuse to remove such applicable legends, unless there is delivered to the Trust
and the Registrar such satisfactory evidence (which may include a legal opinion)
as may reasonably be required by the Trust and the Indenture Trustee that
neither the applicable legends nor the restrictions on Transfer set forth
therein are required to ensure compliance with the provisions of the Act.
Whenever a Global Note Certificate is to be exchanged for
Definitive Notes, such Definitive Notes will be issued within five business days
of delivery to the Registrar of the information and any required certification
described in the preceding paragraph against the surrender of the relevant
Global Note Certificate at the specified office of the Registrar. Such exchange
shall be effected in accordance with the regulations concerning the Transfer and
registration from time to time relating to the Reset Rate Notes and shall be
effected without charge, but against such indemnity as the Registrar may require
in respect of any tax or other duty of whatsoever nature which may be levied or
imposed in connection with such exchange.
Each Reset Rate Noteholder or Note Owner, as applicable, of
such Reset Rate Note, by its acceptance of a Reset Rate Note or a beneficial
interest therein, respectively, also agrees that it will Transfer such Reset
Rate Note or beneficial interest therein, as the case may be, only as provided
herein and in accordance with the Indenture. In addition, by acceptance of any
Reset Rate Note or beneficial interest therein, as applicable, each proposed
transferee thereof is hereby deemed to have agreed with the conditions set forth
in the applicable Securities Legend and agreed, by virtue of its acceptance of
such Reset Rate Note or beneficial interest therein, as the case may be, to
indemnify the Administrator, the Depositor, the Servicer, the Indenture Trustee
the Eligible Lender Trustee, the Remarketing Agents (in the event such Transfer
is made pursuant to a successful remarketing on a Reset Date) and the Issuer
against any and all liability that may result if such Transfer is not made in a
manner consistent with the restrictions set forth in the Securities Legend. In
addition to any applicable restrictions in the Indenture, with respect to the
Transfer and registration of Transfer of any Reset Rate Note registered in the
name of a Reset Rate Noteholder other than DTC or its nominee, or Euroclear or
Clearstream, Luxembourg or their joint nominee, as the case may be, to a
transferee that takes delivery in the form of a Definitive Note, in a
transaction other than pursuant to an effective registration statement under
Appendix A-3-6
the Act, the Indenture Trustee shall register the Transfer of such Definitive
Note if (i) (A) the requested Transfer is being made to a transferee who has
provided the Indenture Trustee and the Administrator with a Rule 144A and
Related Matters Certificate, substantially in the form attached as Annex 1
hereto, (B) such transferee has provided comparable evidence as to its QIB
status, (C) such Transfer is being made in compliance with Regulation S and such
transferee has provided the Indenture Trustee and the Administrator with a
Regulation S and Related Matters Certificate, substantially in the form attached
as Annex 1 hereto, or (D) such Transfer is being made in reliance on an
exemption from registration under the Act other than Rule 144A or Regulation S
and that such transferor has provided the Indenture Trustee and the
Administrator with reasonably acceptable evidence thereof, and (ii) the
applicable transferor has provided the Indenture Trustee and the Administrator
with a Transferor Letter, substantially in the form of Annex 2 hereto.
7. The Reset Rate Notes will be issued only in minimum
denominations of $250,000, or the applicable currency equivalent of $250,000,
E 100,000, L 100,000 or the applicable currency equivalent of $250,000,
depending on their currency of denomination, and integral multiples of $1,
E 1, L 1 or the applicable currency equivalent of $1, depending on
their currency of denomination, in excess thereof. The Reset Rate Notes are
exchangeable at any time into an equal aggregate principal amount of Reset Rate
Notes of the same class of different authorized denominations pursuant to
Section 2.4 of the Indenture.
8. Reset Rate Notes may be presented or surrendered pursuant
to Section 2.4 of the Indenture.
9. No service charge shall be made to a Noteholder for any
registration of Transfer or exchange of Reset Rate Notes, but the Indenture
Trustee may require payment of a sum sufficient to cover any tax or other
governmental charge pursuant to Section 2.4 of the Indenture.
10. The Indenture Trustee shall cancel all Reset Rate Notes
surrendered for Transfer or exchange pursuant to Section 2.8 of the Indenture.
11. For so long as the Reset Rate Notes are "restricted
securities" within the meaning of Rule 144(a)(3) of the Act, (1) the
Administrator will provide or cause to be provided to any holder of such Reset
Rate Notes and any prospective purchaser thereof designated by such a holder,
upon the request of such holder or prospective purchaser, the information
required to be provided to such holder or prospective purchaser by Rule
144A(d)(4) under the Act; and (2) the Administrator shall update such
information from time to time in order to prevent such information from becoming
false and misleading and will take such other actions as are necessary to ensure
that the safe harbor exemption from the registration requirements of the Act
under Rule 144A is and will be available for resales of such Reset Rate Notes
conducted in accordance with Rule 144A.
Appendix X-0-0
XXXXX 0 XX
XXXXXXXX X-0
FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE
[Date]
[SELLER]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
The Student Loan Marketing Association, as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2003-12, Student Loan-Backed,
Class A-6 Reset Rate Notes (the "Reset Rate Notes")
Dear Sirs:
In connection with our purchase of the Reset Rate Notes of the
above-referenced series, the undersigned certifies to each of the parties to
whom this letter is addressed that it is a qualified institutional buyer (as
defined in Rule 144A under the Securities Act of 1933, as amended (the "Act"))
as follows:
(A) It owned and/or invested on a discretionary basis eligible
securities (excluding affiliate's securities, bank deposit notes and CD's, loan
participations, repurchase agreements, securities owned but subject to a
repurchase agreement and swaps), as described below:
Date:_______________, 20___(must be on or after the
close of its most recent fiscal year)
Amount: $__________________ ; and
(B) The dollar amount set forth above is:
1. greater than $100 million and the undersigned is one of the
following entities:
(a) an insurance company as defined in Section 2(13)of the
Act; or
Appendix A-3-8
(b) an investment company registered under the
Investment Company Act or any business development company as
defined in Section 2(a)(48) of the Investment Company Act of
1940; or
(c) a Small Business Investment Company licensed by
the U.S. Small Business Administration under Section 301 (c)
or (d) of the Small Business Investment Act of 1958; or
(d) a plan (i) established and maintained by a state,
its political subdivisions, or any agency or instrumentality
of a state or its political subdivisions, the laws of which
permit the purchase of securities of this type, for the
benefit of its employees and (ii) the governing investment
guidelines of which permit the purchase of securities of this
type; or
(e) a business development company as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940; or
(f) a corporation (other than a U.S. bank, savings
and loan association or equivalent foreign institution),
partnership, Massachusetts or similar business trust, or an
organization described in Section 501(c)(3) of the Internal
Revenue Code; or
(g) a U.S. bank, savings and loan association or
equivalent foreign institution, which has an audited net worth
of at least $25 million as demonstrated in its latest annual
financial statements; or
(h) an investment adviser registered under the
Investment Advisers Act; or
2. greater than $10 million, and the undersigned is a
broker-dealer registered with the SEC; or
3. less than $10 million, and the undersigned is a
broker-dealer registered with the SEC and will only purchase Rule 144A
securities in transactions in which it acts as a riskless principal (as
defined in Rule 144A); or
4. less than $100 million, and the undersigned is an
investment company registered under the Investment Company Act of 1940,
which, together with one or more registered investment companies having
the same or an affiliated investment adviser, owns at least $100
million of eligible securities; or
5. less than $100 million, and the undersigned is an entity,
all the equity owners of which are qualified institutional buyers.
The undersigned further certifies that it is purchasing the
Reset Rate Notes for its own account or for the account of others that
independently qualify as "Qualified Institutional Buyers" as defined in Rule
144A (a "QIB"). It is aware that the sale of the Reset Rate Notes is being made
in reliance on its continued compliance with Rule 144A. It is aware that the
Appendix A-3-9
transferor may rely on the exemption from the provisions of Section 5 of the Act
provided by Rule 144A. The undersigned understands that the Reset Rate Notes may
Transferred only (A) so long as such Reset Rate Notes are eligible for resale
pursuant to Rule 144A, to a person whom the seller reasonably believes is a QIB
acquiring the Reset Rate Notes for its own account or as a fiduciary or agent
for others (which others must also be QIBs) to whom notice is given that the
Transfer is being made in reliance on Rule 144A, (B) pursuant to an effective
registration statement under the Act, (C) pursuant to an exemption from
registration available under the Act other than Rule 144A, or (D) if the Reset
Rate Notes are then in Foreign Exchange Mode, to a purchaser who is a non-U.S.
Person (as defined in Regulation S) outside the United States of America,
acquiring the Reset Rate Notes pursuant to an exemption from registration under
the Act in accordance with Rule 903 or Rule 904 of Regulation S, in each case in
accordance with any applicable United States state securities or "blue sky" laws
or any securities laws of any other jurisdiction.
The undersigned agrees that if at some future time it wishes
to dispose of or exchange any of the Reset Rate Notes, it will not Transfer or
exchange any of the Reset Rate Notes unless: (1) the sale is to an Eligible
Purchaser (as defined below), (2) all offers or solicitations in connection with
the sale, whether directly or through any agent acting on our behalf, are
limited only to Eligible Purchasers and are not made by means of any form of
general solicitation or general advertising whatsoever, and (3) such transferee
shall deliver a Rule 144A and Related Matters Certificate to substantially the
same effect as this letter to the addressees hereof or a Regulation S and
Related Matters Certificate substantially in the same form as Annex 1 to
Appendix 3 to the Indenture, or such other evidence as may be reasonably
acceptable to the Administrator.
The undersigned hereby represents and warrants that the
undersigned is accepting ownership of the Reset Rate Notes in compliance with
the restrictions set forth in Section 5. of Appendix A-3 to the Indenture, dated
as of November 1, 2003 (the "Indenture"), among the Trust, Chase Manhattan Bank
USA, National Association, as eligible lender trustee, and The Bank of New York,
as indenture trustee, and acknowledges that the Reset Rate Notes will be issued
with the legends set forth in Section 6. to Appendix A-3 to the Indenture.
"Eligible Purchaser" means a corporation, partnership or other
entity which we have reasonable grounds to believe and do believe (A) (i) can
make representations with respect to itself to substantially the same effect as
the representations set forth herein, and (ii) is a QIB as defined under Rule
144A of the Act or any entity in which all of the equity owners come within such
paragraphs, (B) if the Reset Rate Notes are then in Foreign Exchange Mode, can
make representations with respect to itself to substantially the same effect as
the representations set forth in the Regulation S and Related Matters
Certificate in the same form as Annex 1 to Appendix 3 to the Indenture, or (C)
(i) can make representations with respect to itself substantially to the same
effect as the representations set forth herein (other than to its status as a
QIB), and (ii) is acquiring such Class A-6 Notes in reliance on an exemption to
the Act other than Rule 144A in accordance with any applicable United States
state securities or "Blue Sky" laws.
Appendix A-3-10
If the Purchaser proposes that its Reset Rate Notes be
registered in the name of a nominee on its behalf, the Purchaser has identified
such nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any):___________________________
Appendix A-3-11
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
Qualified Institutional Buyer on the ______ day______ of , 20____ .
Name of Institution
____________________________________________
Signature
____________________________________________
Name
____________________________________________
Title
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the
Reset Rate Notes being registered in its name, the sole beneficial owner thereof
is and shall be the Purchaser identified above, for whom the undersigned is
acting as nominee.
By:_________________________________________
Duly Authorized
Appendix A-3-12
FORM OF REGULATION S AND RELATED MATTERS CERTIFICATE
[Date]
[SELLER]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
The Student Loan Marketing Association, as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2003-12, Student Loan-Backed,
Class A-6 Reset Rate Notes (the "Reset Rate Notes")
Dear Sirs:
In connection with our purchase of the Reset Rate Notes of the
above-referenced series, the undersigned certifies to each of the parties to
whom this letter is addressed that it is a non-U.S. person (as defined in
Regulation S) outside the United States of America, acquiring the Reset Rate
Notes pursuant to an exemption from registration in accordance with Rule 903 or
Rule 904 of Regulation S.
The undersigned further certifies that it is purchasing the
Reset Rate Notes for its own account or for the account of others that
independently qualify as non-U.S. persons (as defined in Regulation S) outside
the United States of America. It is aware that the sale of the Reset Rate Notes
is being made in reliance on its continued compliance with Rule 903 or Rule 904
of Regulation S. The undersigned understands that the Reset Rate Notes may
resold or Transferred only (A) so long as such Reset Rate Notes are eligible for
resale pursuant to Rule 144A, to a person whom the seller reasonably believes is
a QIB acquiring the Reset Rate Notes for its own account or as a fiduciary or
agent for others (which others must also be QIBs) to whom notice is given that
the resale or other Transfer is being made in reliance on Rule 144A, (B)
pursuant to an effective registration statement under the Act, (C) pursuant to
an exemption from registration available under the Act other than Rule 144A, or
(D) if the Reset Rate Notes are then in Foreign Exchange Mode, to a purchaser
who is a non-U.S. Person (as defined in Regulation S) outside the United States
of America, acquiring the Reset Rate Notes pursuant to an exemption from
registration under the Act in accordance with Rule 903 or Rule 904 of Regulation
S, in each case in accordance with any applicable United States state securities
or "blue sky" laws or any securities laws of any other jurisdiction.
Appendix A-3-13
The undersigned agrees that if at some future time it wishes
to dispose of or exchange any of the Reset Rate Notes, it will not Transfer or
exchange any of the Reset Rate Notes unless: (1) the sale is to an Eligible
Purchaser (as defined below), (2) all offers or solicitations in connection with
the sale, whether directly or through any agent acting on our behalf, are
limited only to Eligible Purchasers and are not made by means of any form of
general solicitation or general advertising whatsoever, and (3) such transferee
shall deliver a Rule 144A and Related Matters Certificate substantially in the
same form as Annex 1 to Appendix 3 to the Indenture, or a Regulation S and
Related Matters Certificate to substantially the same effect as this letter to
the addressees hereof or such other evidence as may be reasonably acceptable to
the Administrator and the Indenture Trustee.
The undersigned hereby represents and warrants that the
undersigned is accepting ownership of the Reset Rate Notes in compliance with
the restrictions set forth in Section 5. of Appendix A-3 (other than to its
status as a QIB) to the Indenture, dated as of November 1, 2003 (the
"Indenture"), among the Trust, Chase Manhattan Bank USA, National Association,
as eligible lender trustee, and The Bank of New York, as indenture trustee, and
acknowledges that the Reset Rate Notes will be issued with the legends set forth
in Section 6. to Appendix A-3 to the Indenture.
"Eligible Purchaser" means a corporation, partnership or other
entity which we have reasonable grounds to believe and do believe (A) (i) can
make representations with respect to itself to substantially the same effect as
the representations set forth herein, and (ii) is a QIB as defined under Rule
144A of the Act or any entity in which all of the equity owners come within such
paragraphs, (B) if the Reset Rate Notes are then in Foreign Exchange Mode, can
make representations with respect to itself to substantially the same effect as
the representations set forth in the Regulation S and Related Matters
Certificate in the same form as Annex 1 to Appendix 3 to the Indenture, or (C)
(i) can make representations with respect to itself substantially to the same
effect as the representations set forth herein (other than to its status as a
QIB), and (ii) is acquiring such Class A-6 Notes in reliance on an exemption to
the Act other than Rule 144A in accordance with any applicable United States
state securities or "Blue Sky" laws.
If the Purchaser proposes that its Reset Rate Notes be
registered in the name of a nominee on its behalf, the Purchaser has identified
such nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any):__________________________________
Appendix A-3-14
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
Qualified Institutional Buyer on the ______ day of _______ , 20___.
Name of Institution
____________________________________________
Signature
____________________________________________
Name
____________________________________________
Title
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the
Reset Rate Notes being registered in its name, the sole beneficial owner thereof
is and shall be the Purchaser identified above, for whom the undersigned is
acting as nominee.
By:_________________________________________
Duly Authorized
Appendix X-0-00
XXXXX 0 XX
XXXXXXXX X-0
FORM OF TRANSFEROR LETTER
[Date]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
The Student Loan Marketing Association, as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2003-12, Student Loan-Backed Class
Class A-6 Reset Rate Notes (the "Reset Rate Notes")
Ladies and Gentlemen:
In connection with our disposition of the Reset Rate Notes of
the above-referenced series owned by us, we certify that (a) we understand that
the Reset Rate Notes have not been registered under the Securities Act of 1933,
as amended (the "Act"), and are being disposed by us in a transaction that is
exempt from the registration requirements of the Act, and (b) we have not
offered or sold any Reset Rate Notes to, or solicited offers to buy any Reset
Rate Notes from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action would result in, a violation of Section 5 of the Act.
Very truly yours,
____________________________________________
Print Name of Transferor
By:_________________________________________
Authorized Officer
Appendix X-0-00
XXXXXXXX X-0
TRANSFER RESTRICTIONS FOR
THE CLASS A-5 NOTES
1. Except as otherwise specified herein or as the context may
otherwise require, capitalized terms used but not otherwise defined in this
Appendix A-4 (this "Appendix") are defined in Xxxxxxxx X-0, which also contains
rules as to usage that shall be applicable herein.
2. The Indenture Trustee, as Note Registrar, shall provide for
the registration of Class A-5 Notes and of Transfers and exchanges of Class A-5
Notes pursuant to Section 2.4 of the Indenture.
3. The Class A-5 Notes will be initially represented by
registered notes of such class in global form and shall be issued in the manner
set forth in Sections 2.1, 2.2 and 2.10 of the Indenture. The global notes may
be reissued and represented by Class A-5 Notes of such class in definitive form
pursuant to Section 2.12 of the Indenture.
4. Each purchaser of the Class A-5 Notes that represent a
beneficial interest in a global note certificate will be deemed to have
represented and agreed, and each purchaser of a Definitive Note will be required
to certify in writing, that:
(i) (A) the purchaser is a QIB and is acquiring such Class A-5
Notes for its own account or as a fiduciary or agent for others (which
others also must be QIBs) for investment purposes and not for
distribution in violation of the Act, and it is able to bear the
economic risk of an investment in the Class A-5 Notes and has such
knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of purchasing the Class A-5
Notes,
(ii) the purchaser understands that the Class A-5 Notes are
being offered only in a transaction that does not require registration
under the Act and, if such purchaser decides to resell or otherwise
Transfer such Class A-5 Notes, then it agrees that it will resell or
Transfer such Class A-5 Notes only (A) so long as such Class A-5 Notes
are eligible for resale pursuant to Rule 144A, to a person whom the
seller reasonably believes is a QIB acquiring the Class A-5 Notes for
its own account or as a fiduciary or agent for others (which others
must also be QIBs) to whom notice is given that the resale or other
Transfer is being made in reliance on Rule 144A, (B) pursuant to an
effective registration statement under the Act, or (C) pursuant to an
exemption from registration under the Act other than Rule 144A, in each
case in accordance with any applicable United States state securities
or blue sky laws;
(iii) unless the legend set out below has been removed from
the Class A-5 Notes such purchaser shall notify each transferee of the
Class A-5 Notes that (A) such Class A-5 Notes have not been registered
under the Act, (B) the holder of such Class X-0
Xxxxxxxx X-0-0
Notes is subject to the restrictions on the resale or other Transfer
thereof described in paragraph (ii) above, (C) such transferee shall be
deemed to have represented (1) as to its status as a QIB, (2) that such
transferee is acquiring the Class A-5 Notes for its own account or as a
fiduciary or agent for others (which others also must be QIB's) (or
that such transferee is acquiring such Class A-5 Notes in reliance on
an exemption under the Act other than Rule 144A or pursuant to an
effective registration statement under the Act), (3) that such
transferee is not an underwriter within the meaning of Section 2(11) of
the Act, and (4) that such transferee shall be deemed to have agreed to
notify its subsequent transferees as to the foregoing;
(iv) the acquisition or purchase by an employee benefit plan
or other retirement arrangement ("Plan") of a Class A-5 Note will not
constitute or otherwise result in: (A) in the case of a Plan subject to
Section 406 of Employee Retirement Income Security Act of 1974, as
amended ("ERISA") or Section 4975 of the Internal Revenue Code of 1986,
as amended ("Code"), a non-exempt prohibited transaction in violation
of Section 406 of ERISA or Section 4975 of the Code which is not
covered by a class or other applicable exemption and (B) in the case of
a Plan subject to a substantially similar federal, state, local or
foreign law ("Similar Law"), a non-exempt violation of such
substantially Similar Law.
5. By acceptance of a Class A-5 Note, whether upon original
issuance or subsequent Transfer, each Class A-5 Noteholder or Note Owner, as
applicable, of the Class A-5 Notes (or a beneficial interest therein) offered
and sold only to a QIB in reliance on Rule 144A, acknowledges or is deemed to
acknowledge, as the case may be, the restrictions on the Transfer of the Class
A-5 Notes and that the following securities legend (the "Class A-5 Securities
Legend") shall be affixed to each Class A-5 global note certificate, and each
Definitive Note representing an interest in such certificate (collectively, the
"Rule 144A Class A-5 Certificates") unless determined otherwise in accordance
with applicable law:
THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"), ANY UNITED STATES STATE SECURITIES OR "BLUE
SKY" LAWS OR ANY SECURITIES LAWS OF ANY OTHER JURISDICTION,
AND MAY NOT BE OFFERED OR SOLD IN VIOLATION OF THE SECURITIES
ACT OR SUCH OTHER LAWS. THIS NOTE MAY BE TRANSFERRED ONLY IN
MINIMUM DENOMINATIONS OF NOT LESS THAN $250,000. THE HOLDER
HEREOF, BY PURCHASING OR ACCEPTING THIS NOTE IS HEREBY DEEMED
TO HAVE AGREED FOR THE BENEFIT OF THE TRUST AND THE INITIAL
PURCHASERS THAT IT WILL RESELL, PLEDGE OR OTHERWISE TRANSFER
THIS NOTE ONLY (A) (1) SO LONG AS THIS NOTE IS ELIGIBLE FOR
RESALE, PURSUANT TO RULE 144A PROMULGATED UNDER THE SECURITIES
ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A QUALIFIED
Appendix A-4-2
INSTITUTIONAL BUYER, AS DEFINED IN RULE 144A (A "QUALIFIED
INSTITUTIONAL BUYER"), THAT IS ACQUIRING THIS NOTE FOR ITS OWN
ACCOUNT OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS
MUST ALSO BE QUALIFIED INSTITUTIONAL BUYERS) TO WHOM NOTICE IS
GIVEN THAT THE RESALE OR OTHER TRANSFER IS BEING MADE IN
RELIANCE ON RULE 144A, (2) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OTHER THAN RULE 144A OR
(3) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY APPLICABLE
UNITED STATES STATE SECURITIES OR "BLUE SKY" LAWS OR ANY
SECURITIES LAWS OF ANY OTHER JURISDICTION. UPON ACQUISITION OR
TRANSFER OF A CLASS A-5 NOTE OR A BENEFICIAL INTEREST IN A
CLASS A-5 NOTE, AS THE CASE MAY BE, BY, FOR OR WITH THE ASSETS
OF, AN EMPLOYEE BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT
(A "PLAN"), SUCH CLASS A-5 NOTE OWNER SHALL BE DEEMED TO HAVE
REPRESENTED THAT SUCH ACQUISITION OR PURCHASE WILL NOT
CONSTITUTE OR OTHERWISE RESULT IN: (I) IN THE CASE OF A PLAN
SUBJECT TO SECTION 406 OF EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA") OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), A
NON-EXEMPT PROHIBITED TRANSACTION IN VIOLATION OF SECTION 406
OF ERISA OR SECTION 4975 OF THE CODE WHICH IS NOT COVERED BY A
CLASS OR OTHER APPLICABLE EXEMPTION AND (II) IN THE CASE OF A
PLAN SUBJECT TO A SUBSTANTIALLY SIMILAR FEDERAL, STATE, LOCAL
OR FOREIGN LAW ("SIMILAR LAW"), A NON-EXEMPT VIOLATION OF SUCH
SUBSTANTIALLY SIMILAR LAW. ANY TRANSFER FOUND TO HAVE BEEN
MADE IN VIOLATION OF SUCH DEEMED REPRESENTATION SHALL BE NULL
AND VOID AND OF NO EFFECT.
THIS NOTE AND RELATED DOCUMENTATION MAY BE AMENDED OR
SUPPLEMENTED FROM TIME TO TIME TO MODIFY THE RESTRICTIONS ON
AND PROCEDURES UNDERTAKEN OR REPRESENTED BY THE HOLDER, FOR
RESALES AND OTHER TRANSFERS OF THIS NOTE, TO REFLECT ANY
CHANGE IN APPLICABLE LAWS OR REGULATIONS (OR THE
INTERPRETATION THEREOF) OR IN PRACTICES RELATING TO RESALES OR
OTHER TRANSFERS OF RESTRICTED SECURITIES GENERALLY.
Appendix A-4-3
THE HOLDER OF THIS NOTE AND ANY BENEFICIAL OWNER OF ANY
INTEREST THEREIN SHALL BE DEEMED, BY ITS ACCEPTANCE OR
PURCHASE HEREOF, TO HAVE AGREED TO ANY SUCH AMENDMENT OR
SUPPLEMENT (EACH OF WHICH SHALL BE CONCLUSIVE AND BINDING ON
THE HOLDER HEREOF AND ALL FUTURE HOLDERS OF THIS NOTE AND ANY
CLASS A-5 NOTES ISSUED IN EXCHANGE OR SUBSTITUTION HEREFOR,
WHETHER OR NOT ANY NOTATION THEREOF IS MADE HEREON) AND AGREES
TO TRANSFER THIS NOTE ONLY IN ACCORDANCE WITH ANY SUCH
AMENDMENT OR SUPPLEMENT IN ACCORDANCE WITH APPLICABLE LAW IN
EFFECT AT THE DATE OF SUCH TRANSFER.
Upon the Transfer, exchange or replacement of a Rule 144A
Class A-5 Certificate bearing the applicable legends set forth above, or upon
specific request for removal of the legends, the Trust or the Registrar will
deliver only replacement Rule 144A Class A-5 Certificates, that bear such Class
A-5 Securities Legend, or will refuse to remove such Class A-5 Securities
Legend, unless there is delivered to the Trust and the Registrar such
satisfactory evidence (which may include a legal opinion) as may reasonably be
required by the Trust and the Indenture Trustee that neither the applicable
legends nor the restrictions on Transfer set forth therein are required to
ensure compliance with the provisions of the Act.
Whenever a global note certificate is to be exchanged for a
Definitive Note, such Definitive Note will be issued within five business days
of delivery to the Registrar of the information and any required certification
described in the preceding paragraph against the surrender of the relevant
global note certificate at the specified office of the Registrar. Such exchange
shall be effected in accordance with the regulations concerning the Transfer and
registration from time to time relating to the Class A-5 Notes and shall be
effected without charge, but against such indemnity as the Registrar may require
in respect of any tax or other duty of whatsoever nature which may be levied or
imposed in connection with such exchange.
Each Class A-5 Noteholder or Note Owner, as applicable, of
such Class A-5 Note, by its acceptance of a Class A-5 Note or a beneficial
interest therein, respectively, also agrees that it will Transfer such Class A-5
Note or beneficial interest therein, as the case may be, only as provided herein
and in accordance with the Indenture. In addition, by acceptance of any Class
A-5 Note or beneficial interest therein, as applicable, each proposed transferee
thereof is hereby deemed to have agreed with the conditions set forth in the
Class A-5 Securities Legend and agreed, by virtue of its acceptance of such
Class A-5 Note or beneficial interest therein, as the case may be, to indemnify
the Administrator, the Depositor, the Servicer, the Indenture Trustee, the
Eligible Lender Trustee and the Issuer against any and all liability that may
result if such Transfer is not made in a manner consistent with the restrictions
set forth in the Class A-5 Securities Legend. In addition to any applicable
restrictions in the Indenture, with respect to the Transfer and registration of
Transfer of any Definitive Note representing an interest in the Class A-5 Notes
registered in the name of a Class A-5 Noteholder other than DTC or its nominee,
to a transferee that takes delivery in the form of a Definitive Note, the
Indenture Trustee shall register the Transfer of such Definitive Note if (i) (A)
the requested Transfer is
Appendix A-4-4
being made to a transferee who has provided the Indenture Trustee and the
Administrator with a transferee Certificate, substantially in the form attached
as Annex A hereto, (B) such transferee has provided comparable evidence as to
its QIB status, or (C) such Transfer is being made in reliance on an exemption
from registration under the Act other than Rule 144A and such transferor has
provided the Indenture Trustee and the Administrator with reasonably acceptable
evidence thereof and (ii) the applicable transferor has provided the Indenture
Trustee and the Administrator with a Transferor Letter, substantially in the
form of Annex B hereto.
1. The Class A-5 Notes will be issued initially only in
minimum denominations of $250,000, and additional increments of $1,000, in
excess thereof. The Class A-5 Notes are exchangeable at any time into an equal
aggregate principal amount of Class A-5 Notes of the same class of different
authorized denominations pursuant to Section 2.4 of the Indenture.
2. Class A-5 Notes may be presented or surrendered pursuant to
Section 2.4 of the Indenture.
3. No service charge shall be made to a Noteholder for any
registration of Transfer or exchange of Class A-5 Notes, but the Indenture
Trustee may require payment of a sum sufficient to cover any tax or other
governmental charge pursuant to Section 2.4 of the Indenture.
4. The Indenture Trustee shall cancel all Class A-5 Notes
surrendered for Transfer or exchange pursuant to Section 2.8 of the Indenture.
5. For so long as the Class A-5 Notes are "restricted
securities" within the meaning of Rule 144(a)(3) of the Securities Act, (1) the
Administrator will provide or cause to be provided to any holder of such Class
A-5 Notes and any prospective purchaser thereof designated by such a holder,
upon the request of such holder or prospective purchaser, the information
required to be provided to such holder or prospective purchaser by Rule
144A(d)(4) under the Act; and (2) the Administrator shall update such
information from time to time in order to prevent such information from becoming
false and misleading and will take such other actions as are necessary to ensure
that the safe harbor exemption from the registration requirements of the Act
under Rule 144A is and will be available for resales of such Class A-5 Notes
conducted in accordance with Rule 144A.
Appendix A-4-5
ANNEX A TO
APPENDIX A-4
FORM OF TRANSFEREE CERTIFICATE
[Date]
[SELLER]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
The Student Loan Marketing Association, as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2003-12 (the "Trust"), Student
Loan-Backed Class A-5 Notes (the "Class A-5 Notes")
Dear Sirs:
In connection with our purchase of the Class A-5 Notes of the
above-referenced series, the undersigned certifies to each of the parties to
whom this letter is addressed that it is a qualified institutional buyer (as
defined in Rule 144A under the Securities Act of 1933, as amended (the "Act"))
as follows:
A) It owned and/or invested on a discretionary basis eligible
securities (excluding affiliate's securities, bank deposit notes and CD's, loan
participations, repurchase agreements, securities owned but subject to a
repurchase agreement and swaps), as described below:
Date:__________ , 20__ (must be on or after the close of its
most recent fiscal year)
Amount: $_________ ; and
B) The dollar amount set forth above is:
1. greater than $100 million and the undersigned is one of the
following entities:
a. an insurance company as defined in Section 2(13)
of the Act; or
Appendix A-4-6
b. an investment company registered under the
Investment Company Act or any business development company as
defined in Section 2(a)(48) of the Investment Company Act of
1940; or
c. a Small Business Investment Company licensed by
the U.S. Small Business Administration under Section 301 (c)
or (d) of the Small Business Investment Act of 1958; or
d. a plan (i) established and maintained by a state,
its political subdivisions, or any agency or instrumentality
of a state or its political subdivisions, the laws of which
permit the purchase of securities of this type, for the
benefit of its employees and (ii) the governing investment
guidelines of which permit the purchase of securities of this
type; or
e. a business development company as defined in
Section 202(a)(22) of the Investment Advisers Act of 1940; or
f. a corporation (other than a U.S. bank, savings and
loan association or equivalent foreign institution),
partnership, Massachusetts or similar business or statutory
trust, or an organization described in Section 501(c)(3) of
the Internal Revenue Code; or
g. a U.S. bank, savings and loan association or
equivalent foreign institution, which has an audited net worth
of at least $25 million as demonstrated in its latest annual
financial statements; or
h. an investment adviser registered under the
Investment Advisers Act; or
2. greater than $10 million, and the undersigned is a
broker-dealer registered with the SEC; or
3. less than $10 million, and the undersigned is a
broker-dealer registered with the SEC and will only purchase Rule 144A
securities in transactions in which it acts as a riskless principal (as
defined in Rule 144A); or
4. less than $100 million, and the undersigned is an
investment company registered under the Investment Company Act of 1940,
which, together with one or more registered investment companies having
the same or an affiliated investment adviser, owns at least $100
million of eligible securities; or
5. less than $100 million, and the undersigned is an entity,
all the equity owners of which are qualified institutional buyers.
The undersigned further certifies that it is purchasing the
Class A-5 Notes for its own account or for the account of others that
independently qualify as "Qualified Institutional Buyers" as defined in Rule
144A (a "QIB"). It is aware that the sale of the Class A-5 Notes is being made
in reliance on its continued compliance with Rule 144A. It is aware that the
Appendix A-4-7
transferor may rely on the exemption from the provisions of Section 5 of the Act
provided by Rule 144A. The undersigned understands that the Class A-5 Notes may
be resold, pledged or Transferred only to a person reasonably believed to be a
QIB that purchases for its own account or for the account of a QIB to whom
notice is given that the resale, pledge or Transfer is being made in reliance on
Rule 144A, or any entity in which all the equity owners come within paragraph
(i), in a transaction that otherwise does not constitute a public offering.
The undersigned agrees that if at some future time it wishes
to dispose of or exchange any of the Class A-5 Notes, it will not Transfer or
exchange any of the Class A-5 Notes unless: (1) the sale is to an Eligible
Purchaser (as defined below), (2) all offers or solicitations in connection with
the sale, whether directly or through any agent acting on our behalf, are
limited only to Eligible Purchasers and are not made by means of any form of
general solicitation or general advertising whatsoever, and (3) such transferee
shall deliver a transferee Certificate to substantially the same effect as this
letter to the addressees hereof or such other evidence as may be acceptable to
the Administrator and the Indenture Trustee as to its status as a QIB.
The undersigned hereby represents and warrants that the
undersigned is accepting ownership of the Class A-5 Notes in compliance with the
restrictions set forth Section (e) of Appendix A-3 to the Indenture, dated as of
November 1, 2003 (the "Indenture"), among the Trust, Chase Manhattan Bank USA,
National Association, as eligible lender trustee, and The Bank of New York, as
indenture trustee, and acknowledges that the Class A-5 Notes will be issued with
the legends set forth in Section 5 to Appendix A-4 to the Indenture.
"Eligible Purchaser" means a corporation, partnership or other
entity which we have reasonable grounds to believe and do believe (A) (i) can
make representations with respect to itself to substantially the same effect as
the representations set forth herein, and (ii) is a QIB as defined under Rule
144A of the Act or any entity in which all of the equity owners come within such
paragraphs or (B) (i) can make representations with respect to itself
substantially to the same effect as the representations set forth herein (other
than to its status as a QIB), and (ii) is acquiring such Class A-5 Notes in
reliance on an exemption to the Act other than Rule 144A in accordance with any
applicable United States state securities or "Blue Sky" laws.
If the Purchaser proposes that its Class A-5 Notes be
registered in the name of a nominee on its behalf, the Purchaser has identified
such nominee below, and has caused such nominee to complete the Nominee
Acknowledgment at the end of this letter.
Name of Nominee (if any):_____________________
Appendix A-4-8
IN WITNESS WHEREOF, this document has been executed by the
undersigned who is duly authorized to do so on behalf of the undersigned
Qualified Institutional Buyer on the___day of___, 20___.
Name of Institution
____________________________________________
Signature
____________________________________________
Name
____________________________________________
Title
Nominee Acknowledgment
The undersigned hereby acknowledges and agrees that as to the
Reset Rate Notes being registered in its name, the sole beneficial owner thereof
is and shall be the Purchaser identified above, for whom the undersigned is
acting as nominee.
By:_________________________________________
Duly Authorized
Appendix A-4-9
ANNEX B TO
APPENDIX A-4
FORM OF TRANSFEROR LETTER
[Date]
The Bank of New York, as Indenture Trustee
0 Xxxxx XxXxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx, 00000
The Student Loan Marketing Association, as Administrator
00000 Xxxxxx Xxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Re: SLM Student Loan Trust 2003-12, Student Loan-Backed Class A-5
Notes (the "Class A-5 Notes")
Ladies and Gentlemen:
In connection with our disposition of the Class A-5 Notes of
the above-referenced series owned by us, we certify that (a) we understand that
the Class A-5 Notes have not been registered under the Securities Act of 1933,
as amended (the "Act"), and are being disposed by us in a transaction that is
exempt from the registration requirements of the Act, and (b) we have not
offered or sold any Class A-5 Notes to, or solicited offers to buy any Class A-5
Notes from, any person, or otherwise approached or negotiated with any person
with respect thereto, in a manner that would be deemed, or taken any other
action would result in, a violation of Section 5 of the Act.
Very truly yours,
____________________________________________
Print Name of Transferor
By:_________________________________________
Authorized Officer
Appendix A-4-10
SCHEDULE A
Schedule of Trust Student Loans
[See Schedule A to the Xxxx of Sale
(Attachment B to the Sale Agreement)]
Schedule A
SCHEDULE B
Location of Trust Student Loan Files
[See Attachment B to the Servicing Agreement]
Schedule B
EXHIBIT A
[FORM OF NOTES]
Exhibit A
EXHIBIT B
[Form of Note Depository Agreement
for U.S. Dollar Denominated Notes]
Exhibit B
EXHIBIT C
[Form of Note Depository Agreement for
Notes Denominated in a Currency Other than U.S. Dollars]
Exhibit C
