EXHIBIT 99.1
LOAN SALE AGREEMENT
among
XXXXX FARGO STUDENT LOAN TRUST 2001-1
as Issuer,
XXXXX FARGO BANK SOUTH DAKOTA, NATIONAL ASSOCIATION,
as Seller,
XXXXX FARGO STUDENT LOANS RECEIVABLES I, LLC,
as Depositor,
and
BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but solely
as Eligible Lender Trustee
Dated as of November 1, 2001
TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Usage
ARTICLE II
Conveyance of Financed Student Loans
SECTION 2.01. Conveyance of Initial Financed Student Loans........................................................1
SECTION 2.02. Conveyance of Prefunded Loans and Serial Loans......................................................2
SECTION 2.03. Treatment as a Security Agreement...................................................................5
SECTION 2.04. Endorsement.........................................................................................6
ARTICLE III
The Financed Student Loans
SECTION 3.01. Representations and Warranties of Seller with Respect to the Financed Student Loans.................6
SECTION 3.02. Purchase; Repurchase; Reimbursement.................................................................7
SECTION 3.03. Repurchase Deposits.................................................................................9
ARTICLE IV
The Seller
SECTION 4.01. Representations of Seller...........................................................................9
SECTION 4.02. Existence..........................................................................................10
SECTION 4.03. Liability of Seller; Indemnities...................................................................10
SECTION 4.04. Merger or Consolidation of, or Assumption of the Obligations of, Seller............................12
SECTION 4.05. Limitation on Liabilities of Seller and Others.....................................................12
SECTION 4.06. Seller May Own Notes...............................................................................12
ARTICLE V
The Depositor
SECTION 5.01. Representations and Warranties of Depositor........................................................12
SECTION 5.02. Liability of Depositor; Indemnities................................................................14
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SECTION 5.03. Merger or Consolidation of, or Assumption of the Obligations of Depositor..........................15
SECTION 5.04. Limitation on Liability of Depositor and Others....................................................15
ARTICLE VI
Miscellaneous
SECTION 6.01. Amendment..........................................................................................16
SECTION 6.02. Protection of Interests in Trust...................................................................17
SECTION 6.03. Notices............................................................................................18
SECTION 6.04. Assignment.........................................................................................20
SECTION 6.05. Limitations on Rights of Others....................................................................20
SECTION 6.06. Severability.......................................................................................21
SECTION 6.07. Separate Counterparts..............................................................................21
SECTION 6.08. Headings...........................................................................................21
SECTION 6.09. Governing Law......................................................................................21
SECTION 6.10. Assignment to Indenture Trustee....................................................................21
SECTION 6.11. Non-Petition Covenants.............................................................................21
SECTION 6.12. Limitation of Liability of Eligible Lender Trustee and Indenture Trustee...........................21
SECTION 6.13. Agreement of Seller and Depositor..................................................................22
iii
LOAN SALE AGREEMENT dated as of November 1, 2001, among XXXXX
FARGO STUDENT LOAN TRUST 2001-1, a Delaware trust (the "Issuer"), XXXXX FARGO
BANK SOUTH DAKOTA, NATIONAL ASSOCIATION, as seller (the "Seller"), XXXXX FARGO
STUDENT LOANS RECEIVABLES I, LLC, as depositor (the "Depositor"), and BANK ONE,
NATIONAL ASSOCIATION ("Bank One"), a national banking association, solely as
eligible lender trustee and not in its individual capacity (the "Eligible Lender
Trustee").
WHEREAS, the Depositor desires to purchase from the Seller a
portfolio of federally reinsured student loans purchased in the ordinary course
of business by the Seller; and
WHEREAS, the Depositor desires to transfer such student loans
to the Issuer and the Issuer desires to acquire such student loans from the
Depositor; and
WHEREAS, the Seller is willing to sell such student loans to
the Eligible Lender Trustee on behalf of the Depositor and the Issuer; and
WHEREAS, the Eligible Lender Trustee is willing to hold legal
title to, and serve as eligible lender trustee with respect to, such student
loans on behalf of the Issuer.
NOW, THEREFORE, in consideration of the premises and the
mutual covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions and Usage
Capitalized terms used but not defined herein are defined in
Appendix A to the Administration Agreement, dated as of November 1, 2001, among
the Issuer, Xxxxx Fargo Bank Minnesota, National Association, as Administrator,
and JPMorgan Chase Bank, as Indenture Trustee, which also contains rules as to
usage and construction that shall be applicable herein.
ARTICLE II
Conveyance of Financed Student Loans
SECTION 2.01. Conveyance of Initial Financed Student Loans.
(a) In consideration of the Depositor's delivery to or upon the
order of the Seller on the Closing Date of the net proceeds from the sale of
the Notes and the other amounts to be distributed from time to time to the
Seller in accordance with the terms of this Agreement, the Seller does hereby,
as evidenced by a duly executed Xxxx of Sale in the form of Exhibit A hereto,
sell, assign, and otherwise convey to the Depositor (and, with respect to
legal title to the Initial Financed Student Loans, to the Eligible Lender
Trustee on behalf of the Depositor)
without recourse except as may be provided herein, (i) all right,
title and interest in and to the Initial Financed Student Loans, and all
obligations of the Obligors thereunder, together with all documents, the related
Student Loan Files and all rights and privileges relating thereto; (ii) all
payments on or collections received thereunder on and after the Cutoff Date,
including without limitation, Liquidation Proceeds and Recoveries; (iii) all of
its right, title and interest, if any, in all funds on deposit from time to time
in the Trust Accounts, including the Reserve Account Initial Deposit and the
Prefunding Account Closing Date Deposit, and in all investments and proceeds
thereof (including all income thereon); and (iv) all proceeds of any and all of
the foregoing.
(b) The Depositor (and, with respect to legal title to the Initial
Financed Student Loans, Bank One as Eligible Lender Trustee on behalf of the
Depositor), immediately after the purchase and sale described in Section 2.01(a)
above but otherwise concurrently with the execution and delivery hereof, does
hereby sell, assign and otherwise convey to the Issuer (and, with respect to the
legal title to the Initial Financed Student Loans, to the Eligible Lender
Trustee on behalf of the Issuer) without recourse subject to the Depositor's
obligations herein and except as may be provided herein, (i) all right, title
and interest in and to the Initial Financed Student Loans, and all obligations
of the Obligors thereunder, together with all documents, the related Student
Loan Files and all rights and privileges relating thereto, (ii) all payments on
or collections received thereunder on and after the Cutoff Date, including
without limitation, Liquidation Proceeds and Recoveries; (iii) all of its right,
title and interest in all funds on deposit from time to time in the Trust
Accounts, including the Reserve Account Initial Deposit and the Prefunding
Account Closing Date Deposit, and in all investments and proceeds thereof
(including all income thereon); (iv) all of its right, title and interest in and
to this Agreement with respect to each Initial Financed Student Loan; (v) all of
its right, title and interest in and to the Demand Note; and (vi) all proceeds
of any and all of the foregoing.
(c) In connection with the sale and assignment of Initial Financed
Student Loans to the Eligible Lender Trustee on behalf of the Issuer, on the
Closing Date, the Depositor shall deposit the Reserve Account Initial Deposit
into the Reserve Account, the Prefunding Account Closing Date Deposit into the
Prefunding Account.
(d) On the Closing Date, the Depositor will deposit, or cause to be
deposited, into the Collection Account all amounts or collections received under
the Initial Financed Student Loans on and after the Cutoff Date net of interest
accrued thereunder prior to the Cutoff Date; provided, that, the Servicer, on
behalf of the Depositor, shall deposit such amounts into the Collection Account
in accordance with the proviso to Section 4.01(a) of the Servicing Agreement.
SECTION 2.02. Conveyance of Prefunded Loans and Serial Loans.
(a) Subject to the conditions set forth in paragraph (d) below, in
consideration of (i) the Issuer's delivery on the related Transfer Date to or
upon the order of the Depositor and (ii) the Depositor's delivery on the related
Transfer Date to or upon the order of the Seller of the Loan Purchase Amount for
each such Prefunded Loan or Serial Loan to be delivered to the
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Depositor or the Seller, as applicable, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Depositor, and the
Depositor does hereby sell, transfer, assign, set over and otherwise convey to
the Issuer and with respect to the legal title the Prefunded Loans and Serial
Loans, to the Eligible Lender Trustee on behalf of the Depositor or the Issuer,
as applicable, without recourse except as may be provided herein, (w) all right,
title and interest of the Seller in and to each Prefunded Loan and Serial Loan
and all obligations of the Obligors thereunder, together with all documents, the
related Student Loan Files and all rights and privileges relating thereto, (x)
all payments on or collections received thereunder on and after the related
Subsequent Cutoff Date, including without limitation, Liquidation Proceeds and
Recoveries, (y) with respect each such sale and conveyance by the Depositor, all
of the Depositor's right, title and interest in and to this Agreement with
respect to each such Prefunded Loan or Serial Loan and (z) all proceeds of any
and all of the foregoing..
(b) During the Funding Period, upon the tender of Prefunded Loans by
the Seller on the related Transfer Date and the satisfaction of the conditions
set forth in subsection (d) of this Section 2.02, the Eligible Lender Trustee
will so inform the Administrator and the Indenture Trustee, and the Loan
Purchase Amounts for such Prefunded Loans will be withdrawn from the
Prefunding Account subject to the provisions of Section 2(f)of the
Administration Agreement, and will be remitted as provided therein to the
Depositor, and immediately thereupon, by the Depositor to or upon the order of
the Seller.
(c) After the Funding Period, upon the tender of Serial Loans by
the Seller on the related Transfer Date and the satisfaction of the conditions
set forth in subsection (d) of this Section 2.02, the Eligible Lender Trustee
will so inform the Administrator and the Indenture Trustee, and the Loan
Purchase Amounts for such Serial Loans will be withdrawn from amounts on deposit
in the Collection Account, as provided in Section 2(d) of the Administration
Agreement, and will be remitted, as provided therein to the Depositor, and
immediately thereupon, by the Depositor to or upon the order of the Seller;
provided, however, that no Serial Loans shall be purchased by the Eligible
Lender Trustee on behalf of either the Depositor or the Issuer at any time after
(i) an Event of Default occurs under the Indenture, a Servicer Default occurs
under the Servicing Agreement or an Administrator Default occurs under the
Administration Agreement, (ii) an Insolvency Event occurs with respect to the
Depositor or the Seller or (iii) October 31, 2003.
(d) The Seller shall transfer to the Depositor, and the Depositor
(and with respect to the legal title to the Prefunded Loans and Serial Loans,
the Eligible Lender Trustee on behalf of the Depositor) shall in turn transfer
to the Issuer (and, with respect to legal title to such Prefunded Loans and
Serial Loans, the Eligible Lender Trustee on behalf of the Issuer), the
Prefunded Loans and Serial Loans for a given Transfer Date and the other
property and rights related thereto described in paragraph (a) above only upon
the satisfaction of each of the following conditions on or prior to such
Transfer Date:
(i) the Seller and the Depositor shall have delivered to the
Eligible Lender Trustee and the Indenture Trustee a duly executed
transfer agreement (including executed
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signature pages by the other parties thereto) in substantially the
form of Exhibit B hereto (each, a "Transfer Agreement"), which shall include
supplements to Schedule A hereto, listing such Prefunded Loans and Serial Loans;
(ii) the Seller shall have delivered, at least two days prior to
such Transfer Date, notice of such transfer to the Depositor, the
Eligible Lender Trustee, the Indenture Trustee and the Rating
Agencies, including a listing of the designation and the aggregate
principal balance of such Prefunded Loans and Serial Loans;
(iii) the Seller, or the Servicer on its behalf (but subject to
the proviso to Section 4.01(a) of the Servicing Agreement), shall have
deposited in the Collection Account all amounts on or collections
received in respect of the Prefunded Loans and Serial Loans on and
after each applicable Subsequent Cutoff Date;
(iv) as of the Transfer Date, each of the Seller and the
Depositor was not insolvent nor will it have been made insolvent by
such transfer nor is it aware of any pending insolvency;
(v) the Seller shall not have been informed by counsel to the
Issuer or the Indenture Trustee that such addition would result in a
material adverse federal or state tax consequence to the Issuer or the
Noteholders;
(vi) each of the Seller and the Depositor shall have delivered to
the Indenture Trustee and the Eligible Lender Trustee an Officers'
Certificate confirming as to itself the satisfaction of each condition
precedent specified in this paragraph (d);
(vii) the Seller shall have delivered on each May 1 and November
1, commencing November 1, 2002 (A) to the Rating Agencies an Opinion
of Counsel with respect to the transfer of the Prefunded Loans and
Serial Loans, transferred to the Issuer since the later of the Closing
Date or the prior May 1 or November 1, substantially in the form of
the Opinion of Counsel delivered to the Rating Agencies on the Closing
Date, and (B) to the Eligible Lender Trustee and the Indenture Trustee
the Opinion of Counsel as required by Section 6.02(f)(1) hereof;
provided, however, that, notwithstanding the foregoing, no opinion
shall be required under either subclause (A) or (B), unless the
Seller, the Eligible Lender Trustee or the Indenture Trustee
determines that, with regard to the most recent opinion on the matters
described in either such subclause that was delivered with respect to
the Financed Student Loans (whether on the Closing Date or thereafter
under this subsection or under another provision of the Basic
Documents), the conclusion of, or the reasoning underlying, such
opinion is no longer correct in all material respects due to a change
in law or regulations or the ruling of a court, an administrative
tribunal or a regulatory or other governmental authority; upon making
any such determination, whichever of the Seller, the Eligible Lender
Trustee and the Indenture Trustee makes such determination shall
notify the others and the Rating Agencies; and provided, further, that
neither the Eligible Lender Trustee nor the Indenture Trustee shall
have any obligation to monitor changes in laws or regulations or
4
the rulings of courts or other governmental agencies for the purpose
of making any determination described in the preceding proviso;
(viii) each of the Seller and the Depositor shall have taken any
action required to maintain the first perfected ownership interest of
the Issuer in the Trust Estate and the first perfected security
interest of the Indenture Trustee in the Collateral;
(ix) no selection procedures believed by the Seller to be adverse
to the interests of the Noteholders shall have been utilized in
selecting the Prefunded Loans or Serial Loans;
(x) no Default or Event of Default shall have occurred under the
Indenture, no Servicer Default shall have occurred under the Servicing
Agreement and no Administrator Default shall have occurred under the
Administration Agreement; and
(xi) for each Transfer Date occurring after the Funding Period,
after giving effect to the conveyance of Serial Loans on such Transfer
Date, the amount of funds remitted for the purchase of Serial Loans on
such Transfer Date, and on each Transfer Date since the preceding
Quarterly Payment Date, shall not exceed the Net Principal Cash Flow
Amount for such Transfer Date minus the sum of (i) all amounts paid to
prepay any Add-on Consolidation Loan not held by the Issuer since the
last Quarterly Payment Date pursuant to Section 2(d)(iii)(A) of the
Administration Agreement and (ii) all amounts which the Administrator
reasonably estimates will be required to prepay Add-on Consolidation
Loans pursuant to Section 2(d)(iii)(A) of the Administration Agreement
during the remainder of the Collection Period.
SECTION 2.03. Treatment as a Security Agreement.
(a) The parties intend that the conveyance of the Seller's right,
title and interest in and to the Initial Financed Student Loans pursuant to this
Agreement and any Prefunded Loans and Serial Loans pursuant to a related
Transfer Agreement shall constitute a valid purchase and sale and not a loan. If
such conveyance is deemed to be a loan and not a sale, then the parties also
intend and agree that the Seller shall be deemed to have granted, and in such
event do hereby grant to the Issuer (as the assignee of the Depositor), a first
priority security interest in all of the Seller's right, title and interest in,
to and under the Initial Financed Student Loans and any Prefunded Loans or
Serial Loans and the other items specified in Sections 2.01 and 2.02, and that
this Agreement (with respect to the Initial Financed Student Loans) and any
applicable Transfer Agreement (with respect to the Prefunded Loans or Serial
Loans conveyed thereby) shall each constitute a security agreement under
applicable law with respect to such loans.
(b) The parties intend that the conveyance of the Depositor's (and
with respect to legal title to the Initial Financed Student Loans, the Eligible
Lender Trustee's) right, title and interest in and to the Initial Financed
Student Loans pursuant to this Agreement and any Prefunded Loans and Serial
Loans pursuant to a related Transfer Agreement shall constitute a
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valid purchase and sale and not a loan. If such conveyance is deemed
to be a loan and not a sale, then the parties also intend and agree that the
Depositor shall be deemed to have granted, and in such event do hereby grant to
the Issuer, a first priority security interest in all of the Depositor's right,
title and interest in, to and under the Initial Financed Student Loans and any
Prefunded Loans or Serial Loans and the other items specified in Sections 2.01
and 2.02, and that this Agreement (with respect to the Initial Financed Student
Loans) and any applicable Transfer Agreement (with respect to the Prefunded
Loans or Serial Loans conveyed thereby) shall each constitute a security
agreement under applicable law with respect to such loans.
(c) If either such conveyance is deemed to be a loan and not a
sale, the Issuer may, to secure the Issuer's own borrowings under the Indenture,
repledge all or any portion of such loans and the other items specified in
Sections 2.01 and 2.02 hereof pledged to the Issuer and not released from the
security interest of this Agreement at the time of such pledge. Such a repledge
may be made by the Issuer with or without a repledge by the Issuer of its rights
under this Agreement, and without further notice to or acknowledgement from the
Seller or the Depositor. Each of the Seller and the Depositor waives, to the
extent permitted by applicable law, all claims, causes of action and remedies
whether legal or equitable (including any rights of set-off) against the Issuer
or any assignee of the Issuer relating to such action by the Issuer in
connection with the transactions contemplated by this Agreement, each Transfer
Agreement and the other Basic Documents.
SECTION 2.04. Endorsement. Each of the Seller and the Depositor hereby
appoints each of the Eligible Lender Trustee and the Indenture Trustee as its
(and Bank One's) true and lawful attorney-in-fact with full power of
substitution to endorse the Seller's and the Depositor's name, as applicable, on
any promissory note evidencing the Initial Financed Student Loans and any
Prefunded Loans or Serial Loans transferred to the Eligible Lender Trustee on
behalf of the Trust pursuant to Sections 2.01 and 2.02. The Seller acknowledges
and agrees that this power of attorney shall be construed as a power coupled
with an interest, shall be irrevocable as long as the Trust Agreement remains in
effect and shall continue in effect until the Trust Agreement terminates. The
Depositor acknowledges and agrees, that this power of attorney shall be
construed as a power coupled with an interest, shall be irrevocable as long as
the Trust Agreement remains in effect and shall continue in effect until the
Trust Agreement terminates.
ARTICLE III
The Financed Student Loans
SECTION 3.01. Representations and Warranties of Seller with Respect to
the Financed Student Loans. The Seller represents and warrants with respect to
the Financed Student Loans as set forth in Exhibit C hereto. Such
representations and warranties speak as of the execution and delivery of this
Agreement and as of the Closing Date, in the case of the Initial Financed
Student Loans, as of the applicable Transfer Date, in the case of the Prefunded
Loans and Serial Loans, as of the date of the relevant Assignment in the case of
any Qualified Substitute Student Loan, as of the date of origination in the case
of any Consolidation Loan added to the Trust during the
6
Funding Period and as of the applicable Add-on Consolidation Loan
Funding Date, in the case of any Consolidation Loan the principal balance of
which is increased by the principal balance of any related Add-on Consolidation
Loan, but shall survive the sale, transfer and assignment of the Financed
Student Loans to the Eligible Lender Trustee on behalf of the Depositor and to
the Eligible Lender Trustee on behalf of the Issuer (and both the origination of
such Consolidation Loans and the addition of the principal balance of any Add-on
Consolidation Loan) and the pledge thereof to the Indenture Trustee pursuant to
the Indenture.
SECTION 3.02. Purchase; Repurchase; Reimbursement.
(a) Upon discovery by the Seller, the Depositor, the Servicer, the
Eligible Lender Trustee or the Indenture Trustee of any breach of the Seller's
representations and warranties or other restrictions made by the Seller pursuant
to Section 3.01, the party discovering the breach shall give prompt written
notice to the others. Unless any such breach shall have been cured within sixty
(60) days after the Seller becomes aware or receives written notice (whichever
is earlier) of such breach, the Seller shall be obligated to either (i)
repurchase any Financed Student Loan in which the interests of the Noteholders
are materially and adversely affected by any such breach any day during the
first Monthly Collection Period succeeding the end of such 60-day period or (ii)
substitute a Qualified Substitute Student Loan in the manner specified in this
Section; provided, however, that it is understood that any such breach that does
not affect the Guarantor's obligation to guarantee payment of such Financed
Student Loan to the Eligible Lender Trustee will not be considered to have a
material adverse effect for this purpose and it is further understood that any
dispute as to whether the Guarantor's obligation has been so affected will be
resolved by the decision of the Indenture Trustee for so long as Notes are
Outstanding and thereafter by the Eligible Lender Trustee. In addition, if any
such breach by the Seller does not trigger such a repurchase obligation but does
result in the refusal by the Guarantor to guarantee all or a portion of the
accrued interest, or the loss (including any obligation of the Issuer to repay
the Department) of certain Interest Subsidy Payments and Special Allowance
Payments, then, unless such breach, if curable, is cured within sixty (60) days,
the Seller shall reimburse the Issuer by remitting an amount equal to all such
non-guaranteed interest amounts and such forfeited Interest Payments and Special
Allowance Payments in the manner specified in Section 3.03. Subject to the
provisions of Section 4.03, the sole remedy of the Issuer, the Eligible Lender
Trustee, the Indenture Trustee or the Noteholders with respect to a breach of
representations and warranties pursuant to Section 3.01, and the agreement
contained in this Section, shall be to require the Seller to repurchase or
substitute for Financed Student Loans or to reimburse the Issuer as provided
above pursuant to this Section, subject to the conditions contained herein.
(b) In consideration of and simultaneously with the purchase or
repurchase of a Financed Student Loan, the Seller shall remit the Purchase
Amount therefor, in the manner specified in Section 3.03, and the Issuer shall
execute such assignments and other documents reasonably requested by the Seller
in order to effect such transfer. Upon any such transfer of a Financed Student
Loan, legal title to, and beneficial ownership and control of, the related
Student
7
Loan File will thereafter belong to the Seller or in the case of legal
title thereto an eligible lender under the Higher Education Act designated by
the Seller.
(c) With respect to any Qualified Substitute Student Loan or Loans,
the Seller shall deliver to the Eligible Lender Trustee for the benefit of the
Indenture Trustee such documents and agreements together with a duly executed
Assignment in the form of Exhibit E hereto. Payments due with respect to
Qualified Substitute Student Loans shall be part of the Trust Estate on and
after the date of such Assignment. Upon such substitution, the Qualified
Substitute Student Loan or Loans shall be subject to the terms of this Agreement
in all respects, and the Seller shall be deemed to have made with respect to
such Qualified Substitute Student Loan or Loans, as of the date of substitution,
the representations and warranties made pursuant to Section 3.01 with respect to
any such Student Loan. In addition, any such substitution shall occur only upon
satisfaction of each of the following conditions on or prior to the date of the
related Assignment:
(i) the Seller shall have deposited in the Collection Account all
collections in respect of the Qualified Substitute Student Loans on
and after each applicable date of Assignment;
(ii) as of the date of the related Assignment, the Seller shall
not have been insolvent nor will it have been made insolvent by such
transfer nor is it aware of any pending insolvency;
(iii) such addition will not result in a material adverse Federal
or State tax consequence to the Issuer or the Noteholders;
(iv) the Seller shall have delivered (A) to the Rating Agencies,
an Opinion of Counsel with respect to each transfer of Qualified
Substitute Student Loans, substantially in the form of the Opinion of
Counsel delivered to the Rating Agencies on the Closing Date, and (B)
to the Eligible Lender Trustee and the Indenture Trustee, the Opinion
of Counsel required by Section 6.02(f)(1) hereof; provided, however,
that no opinion shall be required under either subclause (A) or (B)
unless the Seller, the Eligible Lender Trustee or the Indenture
Trustee determines that, with regard to the most recent opinion on the
matters described in either such subclause that was delivered with
respect to the Financed Student Loans (whether on the Closing Date or
thereafter under this subsection or under another provision of the
Basic Documents), the conclusion of, or the reasoning underlying, such
opinion is no longer correct in all material respects due to a change
in law or regulations or the ruling of a court, an administrative
tribunal or a regulatory or other governmental authority; upon making
any such determination, whichever of the Seller, the Eligible Lender
Trustee and the Indenture Trustee makes such determination shall
notify the others and the Rating Agencies; and provided, further, that
neither the Eligible Lender Trustee nor the Indenture Trustee shall
have any obligation to monitor changes in laws or regulations or the
rulings of courts or other governmental agencies for the purpose of
making any determination described in this clause (iv);
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(v) the Seller shall have taken any action required to maintain
the first perfected ownership interest of the Issuer in the Trust
Estate and the first perfected security interest of the Indenture
Trustee in the Collateral;
(vi) no selection procedures believed by the Seller to be adverse
to the interests of the Noteholders shall have been utilized in
selecting the Qualified Substitute Student Loans; and
(vii) no Default or Event of Default shall have occurred under
the Indenture, no Master Servicer Default shall have occurred under
the Servicing Agreement and no Administrator Default shall have
occurred under the Administration Agreement.
Upon any such substitution and the deposit to the Collection
Account of the amount required to be deposited therein in connection with such
substitution as described in the following paragraph, the Eligible Lender
Trustee shall release any documentation held with respect to the Financed
Student Loan being substituted for (the "Deleted Student Loan") to the Seller
and shall execute and deliver at the Seller's direction such instruments of
transfer or assignment prepared by the Seller, in each case without recourse, as
shall be necessary to vest in the Seller, or (in the case of legal title thereto
an eligible lender under the Higher Education Act designated by the Seller), the
Eligible Lender Trustee's interest in any Deleted Student Loan substituted for
pursuant to this Section 3.02.
For any month in which the Seller substitutes one or more Qualified
Substitute Student Loans for one or more Deleted Student Loans, the Master
Servicer will determine the amount (if any) by which as of the date of the
relevant Assignment the aggregate principal balance of all such Qualified
Substitute Student Loans is less than the aggregate principal balance of all
such Deleted Student Loans. The amount of such shortage (the "Substitution
Adjustment Amount") shall be deposited in the Collection Account by the Seller
on or before the date of the relevant Assignment.
SECTION 3.03. Repurchase Deposits. The Seller shall deposit or cause
to be deposited in the Collection Account the aggregate Purchase Amount with
respect to Purchased Student Loans and all other amounts to be paid by the
Seller under Section 3.02 when such amounts are due.
ARTICLE IV
The Seller
SECTION 4.01. Representations of Seller. The Seller represents as set
forth in Exhibit D hereto. Such representations speak as of the execution and
delivery of this Agreement and as of the Closing Date in the case of the Initial
Financed Student Loans, as of the applicable Transfer Date in the case of the
Prefunded Loans and Serial Loans, as of the date of the relevant Assignment in
the case of any Qualified Substitute Student Loan, and as of the date of
origination in the case of any Consolidation Loan added to the Trust during the
Funding Period
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and as of the applicable Add-on Consolidation Loan Funding Date, in
the case of a Consolidation Loan the principal balance of which is increased by
the principal balance of any related Add-on Consolidation Loan, but shall
survive the sale, transfer and assignment of the Financed Student Loans to the
Eligible Lender Trustee on behalf of the Depositor and to the Eligible Lender
Trustee on behalf of the Issuer (and both the origination of such Consolidation
Loans and the addition of the principal balance of any Add-on Consolidation
Loan) and the pledge thereof to the Indenture Trustee pursuant to the Indenture.
SECTION 4.02. Existence. Subject to Section 4.04, during the term of
this Agreement, the Seller will keep in full force and effect its existence,
rights and franchises as a national banking association under the federal laws
and will 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 Agreement and each other instrument or
agreement necessary or appropriate to the proper administration of this
Agreement and the transactions contemplated hereby. The Seller is currently an
eligible lender under the Higher Education Act and shall maintain such status.
During the Funding Period, to the extent that the Seller shall not be an
eligible lender under the Higher Education Act with respect to federal Student
Loans, the Seller agrees to keep in full force and effect an agreement with
another entity qualified to be an eligible lender under the Higher Education Act
providing for such eligible lender meeting the requirements set forth in the
following sentence to hold title to the Seller's Student Loans in trust for and
on behalf of the Seller. The Seller shall not convey any Prefunded Loans or
Serial Loans if the eligible lender holding legal title to such loan is not the
Seller but another eligible lender within the immediately preceding sentence,
unless prior to such conveyance, such other eligible lender shall agree in
writing to be bound, in the conveyance of each such loan for which it acts as
eligible lender, by the provisions of this Agreement to the same extent as if it
were named separately from the Seller in each of such provisions.
Subject to Section 5.03, during the term of this Agreement, the
Depositor will keep in full force and effect its existence, rights and
franchises as a limited liability company under the laws of the State of
Delaware and will 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 Agreement and each other instrument or
agreement necessary or appropriate to the proper administration of this
Agreement and the transactions contemplated hereby. For so long, during the term
of this Agreement, as the Depositor shall not be an eligible lender under the
Higher Education Act with respect to federal Student Loans, the Depositor agrees
to keep in full force and effect an agreement with Bank One or another eligible
lender under the Higher Education Act providing for such eligible lender meeting
the requirements set forth in the following sentence to hold legal title to the
Depositor's Student Loans in trust for and on behalf of the Depositor. The
Depositor shall not convey any Prefunded Loans or Serial Loans if the eligible
lender holding legal title to such loan is not Bank One, unless prior to such
conveyance, such other eligible lender shall agree in writing to be bound, in
the conveyance of each such loan for which it acts as eligible lender, by the
provisions of this Agreement that are applicable to Bank One, to the same extent
as if it were named separately from Bank One in each of such provisions.
10
SECTION 4.03. Liability of Seller; Indemnities. The Seller shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by the Seller under this Agreement.
(a) The Seller shall indemnify, defend and hold harmless the
Depositor, the Issuer, the Eligible Lender Trustee and the Indenture Trustee and
their officers, directors, employees and agents from and against any taxes that
may at any time be asserted against any such Person with respect to the
transactions contemplated herein and in the other Basic Documents (except any
such income taxes arising out of fees paid to the Eligible Lender Trustee or the
Indenture Trustee), including any sales, gross receipts, general corporation,
tangible personal property, privilege or license taxes (but, in the case of the
Issuer, not including taxes in connection with the issuance and original sale of
the Notes or asserted with respect to ownership of the Financed Student Loans or
federal or other income taxes arising out of payments on the Notes) and costs
and expenses in defending against the same.
(b) The Seller shall indemnify, defend and hold harmless the
Depositor, the Issuer, the Eligible Lender Trustee, the Indenture Trustee and
the Noteholders and the officers, directors, employees and agents of the Issuer,
the Eligible Lender Trustee and the Indenture Trustee from and against any and
all costs, expenses, losses, claims, damages and liabilities arising out of, or
imposed upon such Person through, (i) the Seller's willful misfeasance, bad
faith or gross negligence in the performance of its duties under this Agreement,
or by reason of reckless disregard of its obligations and duties under this
Agreement and (ii) any breach of any of the Seller's representations, warranties
or covenants contained herein, except that, with respect to the representations
and warranties made pursuant to Section 3.01, the remedies for any breach
thereof are limited as provided in Section 3.02.
(c) The Seller, on behalf of itself and the Depositor, shall be
liable as primary obligor for, and shall indemnify, defend and hold harmless the
Eligible Lender Trustee and its officers, directors, employees and agents from
and against, all costs, expenses, losses, claims, damages, obligations and
liabilities arising out of, incurred in connection with or relating to the Trust
Agreement, the other Basic Documents, the Trust Estate, the acceptance or
performance of the trusts and duties set forth herein and in the Trust Agreement
or the action or the inaction of the Eligible Lender Trustee hereunder and under
the Trust Agreement, except to the extent that such cost, expense, loss, claim
damage, obligation or liability: (i) shall be due to the willful misfeasance,
bad faith or negligence (except for errors in judgment) of the Eligible Lender
Trustee, (ii) shall arise from any breach by the Eligible Lender Trustee of its
covenants under any of the Basic Documents; or (iii) shall arise from the breach
by the Eligible Lender Trustee of any of its representations or warranties set
forth in Section 7.03 of the Trust Agreement. In the event of any claim, action
or proceeding for which indemnity will be sought pursuant to this paragraph, the
Eligible Lender Trustee's choice of legal counsel shall be subject to the
approval of the Seller, which approval shall not be unreasonably withheld.
11
(d) The Seller shall pay any and all taxes levied or assessed upon
all or any part of the Trust Estate (other than those taxes expressly excluded
from the Seller's responsibilities pursuant to the parentheticals in paragraph
(a) above).
Indemnification under this Section shall survive the resignation or
removal of the Eligible Lender Trustee or the Indenture Trustee and the
termination of this Agreement or the Indenture or the Trust Agreement, as
applicable, and shall include reasonable fees and expenses of counsel and
expenses of litigation. If the Seller shall have made any indemnity payments
pursuant to this Section and the Person to or on behalf of whom such payments
are made thereafter shall collect any of such amounts from others, such Person
shall promptly repay such amounts to the Seller, without interest.
SECTION 4.04. Merger or Consolidation of, or Assumption of the
Obligations of, Seller. Any person (a) into which the Seller may be merged or
consolidated, (b) which may result from any merger or consolidation to which the
Seller shall be a party or (c) which may succeed to the properties and assets of
the Seller substantially as a whole, shall be the successor to the Seller,
respectively, without the execution or filing of any document or any further act
by any of the parties to this Agreement; provided, however, that the Seller
hereby covenants that it will not consummate any of the foregoing transactions
except upon satisfaction of the following: (i) the surviving Seller executes an
agreement of assumption to perform every obligation of the Seller under this
Agreement, (ii) immediately after giving effect to such transaction, no
representation or warranty made pursuant to Section 4.01 shall have been
breached, (iii) the Seller shall have delivered to the Eligible Lender Trustee
and the Indenture Trustee an Officers' Certificate and an Opinion of Counsel
each stating that such consolidation, merger or succession and such agreement of
assumption comply with this Section and that all conditions precedent, if any,
provided for in this Agreement relating to such transaction have been complied
with, and that the Rating Agency Condition shall have been satisfied with
respect to such transaction and (iv) such transaction will not result in a
material adverse federal or state tax consequence to the Issuer or the
Noteholders and (v) the Seller shall have delivered to the Eligible Lender
Trustee and the Indenture Trustee an Opinion of Counsel either (A) stating that,
in the opinion of such counsel, all financing statements and continuation
statements and amendments thereto have been executed and filed that are
necessary fully to preserve and protect the interests of the Eligible Lender
Trustee and Indenture Trustee, respectively, in the Financed Student Loans and
reciting the details of such filings or (B) stating that, in the opinion of
such counsel, no such action shall be necessary to preserve and protect such
interests.
SECTION 4.05. Limitation on Liabilities of Seller and Others. The
Seller and any director or officer or employee or agent of the Seller may rely
in good faith on the advice of counsel or on any document of any kind, prima
facie properly executed and submitted by any Person respecting any matters
arising hereunder (provided, however, that such reliance shall not limit in any
way the Seller's obligations under Section 3.02). The Seller shall not be under
any obligation to appear in, prosecute or defend any legal action that shall not
be incidental to its respective obligations under this Agreement, and that in
its opinion may involve it in any expense or liability.
12
SECTION 4.06. Seller May Own Notes. The Seller and any Affiliate of
either may in its individual or any other capacity become the owner or pledgee
of Notes with the same rights as it would have if it were not the Seller, as the
case may be or an Affiliate of either, except as expressly provided herein or in
any other Basic Document.
ARTICLE V
The Depositor
SECTION 5.01. Representations and Warranties of Depositor and Bank
One. The Depositor makes the following representations and warranties and Bank
One makes the representations and warranties as set forth in Exhibit E hereto.
Such representations speak as of the execution and delivery of this Agreement
and as of the Closing Date in the case of the Initial Financed Student Loans, as
of the applicable Transfer Date in the case of the Prefunded Loans and Serial
Loans, as of the date of the relevant Assignment in the case of any Qualified
Substitute Student Loan, and, in the case of the Depositor, as of the date of
origination in the case of any Consolidation Loan added to the Trust during the
Funding Period and as of the applicable Add-on Consolidation Loan Funding Date,
in the case of a Consolidation Loan the principal balance of which is increased
by the principal balance of any related Add-on Consolidation Loan, but shall
survive the sale, transfer and assignment of the Financed Student Loans to the
Eligible Lender Trustee on behalf of the Issuer (and both the origination of
such Consolidation Loans and the addition of the principal balance of any Add-on
Consolidation Loan) and the pledge thereof to the Indenture Trustee pursuant to
the Indenture.
(a) Organization and Good Standing. The Depositor has been duly
organized and is validly existing as a limited liability company in good
standing under the laws of the State of Delaware, with power an authority to own
its properties and to conduct its business as such properties are currently
owned and such business is presently conducted, and had at all relevant times,
and has power, authority and legal right to acquire, own and sell the Financed
Student Loans.
(b) Due Qualification. The Depositor is duly qualified to do
business as a foreign limited liability company in good standing and has
obtained all necessary licenses and approvals in each jurisdiction in which the
failure to so qualify or to obtain such licenses and approvals would, in the
reasonable judgment of the Depositor, materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, this Agreement, the Trust Agreement, any of the other Basic
Documents, the Financed Student Loans or the Notes.
(c) Power and Authority. The Depositor has the power and authority
to execute, deliver and perform its obligations under this Agreement and other
Basic Documents to which it is a party. The Depositor has full power and
authority to sell and assign the property to be sold and assigned to and
deposited with the Issuer and has duly authorized such sale and assignment by
all necessary limited liability company action; and the execution, delivery and
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performance of this Agreement and the other Basic Documents to which the
Depositor is a party has been duly authorized by the Depositor by all necessary
limited liability company action.
(d) No Violation. The execution, delivery and performance by the
Depositor of this Agreement and the other Basic Documents to which the Depositor
is a party and the consummation of the transactions contemplated hereby and
thereby and the fulfillment of the terms hereof and thereof does not conflict
with, result in any breach of any of the terms and provisions of, nor constitute
(with or without notice or lapse of time, or both) a default under, the
certificate of formation or limited liability company agreement of the
Depositor, or conflict with or violate any of the material terms of provisions
of or constitute (with or without notice or lapse of time, or both) a default
under, any indenture, agreement or other instrument to which the Depositor is a
party or by which it shall be bound; nor result in the creation or imposition of
any Lien upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than this Agreement); nor violate any law
or, to the Depositor's knowledge, any order, rule or regulation applicable to
the Depositor of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having jurisdiction
over the Depository or its properties, which breach, default, conflict, Lien or
violation would have a material adverse effect on the earnings, business affairs
or business prospects of the Depositor.
(e) No Proceedings. There are no proceedings or investigations
pending, or to the Depositor's knowledge, threatened against the Depositor,
before any court, regulatory body, administrative agency or other governmental
instrumentality having jurisdiction over the Depositor or its properties: (i)
asserting the invalidity of this Agreement or any other Basic Document, (ii)
seeking to prevent the issuance of the Notes or the consummation of any of the
transactions contemplated by the Basic Documents, (iii) seeking any
determination or ruling that might materially and adversely affect the
performance by the Depositor of its obligations under, or the validity or
enforceability of, the Basic Documents or the Notes or (iv) relating to the
Depositor and which might adversely affect the federal income tax attributes of
the Notes.
SECTION 5.02. Liability of Depositor; Indemnities. The Depositor shall
be liable in accordance herewith only to the extent of the obligations
specifically undertaken by the Depositor under this Agreement, which obligations
shall include the following:
(a) The Depositor shall indemnify, defend and hold harmless the
Issuer, the Eligible Lender Trustee, the Indenture Trustee and the Noteholders
and any of the officers, directors, employees and agents of the Issuer, the
Eligible Lender Trustee and the Indenture Trustee from and against any loss,
liability or expense incurred by reason of (i) the Depositor's willful
misfeasance, bad faith or negligence in the performances of its duties under
this Agreement or any other Basic Document to which it is a party, or by reason
of reckless disregard of its obligations and duties under this Agreement or any
other Basic Document to which it is a party and (ii) any breach of any of the
Depositor's representations, warranties or covenants contained herein.
14
Indemnification under this Section shall survive the resignation or
removal of the Owner Trustee or the Indenture Trustee, as the case may be, and
the termination of this Agreement and shall include reasonable fees and expenses
of counsel and expenses of litigation. If the Depositor shall have made any
indemnity payments pursuant to this Section and the Person to or on behalf of
whom such payments are made thereafter shall collect any of such amounts from
others, such Person shall promptly repay such amounts to the Depositor, without
interest.
SECTION 5.03. Merger or Consolidation of, or Assumption of the
Obligations of Depositor.
(a) Any person (i) into which the Depositor or Bank One may be
merged or consolidated, (ii) which may result from any merger or consolidation
to which the Depositor or Bank One shall be a party or (iii) which may succeed
to the properties and assets of the Depositor substantially as a whole, shall be
the successor to the Depositor or Bank One, respectively, without the execution
or filing of any document or any further act by any of the parties to this
Agreement; provided, however, that the Depositor hereby covenants that it will
not consummate any of the foregoing transactions except upon satisfaction of the
following: (A) the surviving Depositor executes an agreement of assumption to
perform every obligation of the Depositor under this Agreement, (B) immediately
after giving effect to such transaction, no representation or warranty made
pursuant to Section 5.01 shall have been breached and no Servicer Default, Event
of Default or Administrator Default and no event that, after notice or lapse of
time, or both, would become a Servicer Default, Event of Default or
Administrative Default shall have occurred and be continuing, (C) the Depositor
shall have delivered to the Eligible Lender Trustee and the Indenture Trustee an
Officers' Certificate and an Opinion of Counsel each stating that such
consolidation, merger or succession and such agreement of assumption comply with
this Section and that all conditions precedent, if any, provided for in this
Agreement relating to such transaction have been complied with, and that the
Rating Agency Condition shall have been satisfied with respect to such
transaction, (D) such transaction will not result in a material adverse federal
or state tax consequence to the Issuer or the Noteholders and (F) the Depositor
shall have delivered to the Eligible Lender Trustee and the Indenture Trustee an
Opinion of Counsel either (1) stating that, in the opinion of such counsel, all
financing statements and continuation statements and amendments thereto have
been executed and filed that are necessary fully to preserve and protect the
interest of the Eligible Lender Trustee and Indenture Trustee, respectively, in
the Financed Student Loans and reciting the details of such filings, or (2)
stating that, in the opinion of such counsel, no such action shall be necessary
to preserve and protect such interests; and provided, further, that Bank One
hereby covenants that, unless Bank One is the surviving entity, it will not
consummate any of the foregoing transactions unless Bank One shall have
delivered to the Eligible Lender Trustee and the Indenture Trustee an Opinion of
Counsel either (Y) stating that in the opinion of such counsel, all financing
statements and continuation statements and amendments thereto have been executed
and filed that are necessary fully to preserve and protect the interest of the
Eligible Lender Trustee and the Indenture Trustee, respectively, in the Financed
Student Loans and reciting the details of such filings, or (Z) stating that, in
the opinion of such counsel, no such action shall be necessary
to preserve and protect such interests.
15
SECTION 5.04. Limitation on Liability of Depositor and Others.
(a) Neither the Depositor nor any of the directors, officers,
employee or agents of the Depositor shall be under any liability to the Issuer
or the Noteholders for any action taken or for refraining from the taking of any
action pursuant to this Agreement or for errors in judgment; provided, however,
that this provision shall not protect the Depositor or any such Person against
any liability that would otherwise be imposed by reason of willful misfeasance
or bad faith in the performance of duties or by reason of reckless disregard of
obligations and duties under this Agreement (except for errors in judgment). The
Depositor, and its directors, officers, employees and agents, may rely in good
faith on the advice of counsel or on any document of any kind prima facie
property executed and submitted by any Person in request of any matters arising
under this Agreement.
(b) The Depositor shall not be under any obligation to appear in,
prosecute or defend any legal action that shall not be incidental to its
obligations under this Agreement and that in its opinion may involve it in any
expense or liability.
ARTICLE VI
Miscellaneous
SECTION 6.01. Amendment. This Agreement may be amended by the
Seller, the Depositor and the Eligible Lender Trustee, with the consent of the
Indenture Trustee, but without the consent of any of the Noteholders, to cure
any ambiguity, to correct or supplement any provisions in this Agreement or for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions in this Agreement or of modifying in any manner the rights
of the Noteholders; provided, however, that such action shall not, as evidenced
by an Opinion of Counsel delivered to the Eligible Lender Trustee and the
Indenture Trustee, adversely affect in any material respect the interests of any
Noteholder.
This Agreement may also be amended from time to time by the Seller
and the Eligible Lender Trustee, the Indenture Trustee and the Noteholders of
Notes evidencing not less than a majority of the Outstanding Amount of the
Notes, for the purpose of adding any provisions to or changing in any manner or
eliminating any of the provisions of this Agreement or of modifying in any
manner the rights of the Noteholders; provided, however, that no such amendment
shall (a) increase or reduce in any manner the amount of, or accelerate or delay
the timing of, collections of payments with respect to Financed Student Loans or
distributions that shall be required to be made for the benefit of the
Noteholders or the Swap Counterparty or (b) reduce the aforesaid percentage of
the Outstanding Amount of the Notes, the Noteholders of which are required to
consent to any such amendment, without the consent of all outstanding
Noteholders and the Swap Counterparty.
Promptly after the execution of any such amendment or consent (or,
in the case of the Rating Agencies, five Business Days prior thereto), the
Eligible Lender Trustee shall furnish written notification of the substance of
such amendment or consent to the Seller, the Depositor,
16
the Administrator, each Noteholder, the Indenture Trustee, the Servicer and
each of the Rating Agencies.
It shall not be necessary for the consent of Noteholders pursuant
to this Section to approve the particular form of any proposed amendment or
consent, but it shall be sufficient if such consent shall approve the substance
thereof.
Prior to the execution of any amendment to this Agreement, the
Eligible Lender Trustee and the Indenture Trustee shall receive upon request and
rely upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement and the Opinion of Counsel referred to
in Section 6.02(f). The Eligible Lender Trustee and the Indenture Trustee may,
but shall not be obligated to, enter into any such amendment which affects the
Eligible Lender Trustee's or the Indenture Trustee's, as applicable, own rights,
duties or immunities under this Agreement or otherwise.
SECTION 6.02. Protection of Interests in Trust.
(a) Each of the Seller, the Depositor and Bank One shall execute
and file such financing statements and cause to be executed and filed such
continuation statements, all in such manner and in such places as may be
required by law fully to preserve, maintain, and protect the interest of the
Issuer, the Eligible Lender Trustee and the Indenture Trustee in the Financed
Student Loans and in the proceeds thereof. The Seller or the Depositor, as
applicable, and Bank One shall deliver (or cause to be delivered) to the
Eligible Lender Trustee and the Indenture Trustee file-stamped copies of, or
filing receipts for, any document filed as provided above, as soon as available
following such filing.
(b) Each of the Seller, the Depositor and Bank One shall not change
its name, identity or corporate structure in any manner that would, could, or
might make any financing statement or continuation statement filed in accordance
with paragraph (a) above seriously misleading within the meaning of Section
9-402(7) of the UCC, unless it shall have given the Eligible Lender Trustee and
the Indenture Trustee at least five (5) days' prior written notice thereof and
shall have promptly filed appropriate amendments to all previously filed
financing statements or continuation statements.
(c) Each of the Seller, the Depositor and Bank One shall have an
obligation to give the Eligible Lender Trustee, the Indenture Trustee and the
Rating Agencies at least sixty (60) days prior written notice of any change of
its location for purposes of the UCC if, as a result thereof, the applicable
provisions of the UCC would require the filing of any amendment of any
previously filed financing or continuation statement or of any new financing
statement and shall promptly file any such amendment.
(d) If at any time the Seller or the Depositor or Bank One shall
propose to sell, grant a security interest in, or otherwise transfer any
interest in student loans to any prospective purchaser, lender or other
transferee, the Seller or the Depositor, as applicable, shall give to such
prospective purchaser, lender or other transferee computer tapes, records or
printouts (including
17
any restored from backup archives) that, if they shall refer in any
manner whatsoever to any Financed Student Loan, shall indicate clearly that such
Financed Student Loan has been sold and is owned by the Issuer and has been
pledged to the Indenture Trustee.
(e) The Depositor shall, to the extent required by applicable law,
cause the Notes to be registered with the Commission pursuant to Section 12(b)
or Section 12(g) of the Exchange Act within the time periods specified in such
sections.
(f) The Seller shall deliver to the Eligible Lender Trustee and the
Indenture Trustee:
(1) promptly after the execution and delivery of this
Agreement and of each amendment thereto, an Opinion of Counsel
either (A) stating that, in the opinion of such counsel, all
financing statements and continuation statements have been
executed and filed that are necessary fully to preserve and
protect the interest of the Eligible Lender Trustee and the
Indenture Trustee in the Financed Student Loans, and reciting
the details of such filings or referring to prior Opinions of
Counsel in which such details are given, or (B) stating that,
in the opinion of such counsel, no such action shall be
necessary to preserve and protect such interest; and
(2) within 120 days after the beginning of each calendar year
beginning with the first calendar year beginning more than
three months after the Cutoff Date, an Opinion of Counsel,
dated as of a date during such 120-day period, either (A)
stating that, in the opinion of such counsel, all financing
statements and continuation statements have been executed and
filed that are necessary fully to preserve and protect the
interest of the Eligible Lender Trustee and the Indenture
Trustee in the Financed Student Loans, and reciting the
details of such filings or referring to prior Opinions of
Counsel in which such details are given, or (B) stating that,
in the opinion of such counsel, no such action shall be
necessary to preserve and protect such interest; provided,
however, that a single Opinion of Counsel may be delivered in
satisfaction of the foregoing requirement and that of Section
3.06(b) of the Indenture.
Each Opinion of Counsel referred to in clause (1) or (2) above
shall specify (as of the date of such opinion and given all applicable laws as
in effect on such date) any action necessary to be taken in the following year
to preserve and protect such interest.
SECTION 6.03. Notices. Unless otherwise agreed by the recipient,
all demands, notices and communications upon or to the Seller, the Depositor,
the Servicer, the Issuer, the Eligible Lender Trustee, the Indenture Trustee,
the Administrator or the Rating Agencies under this Agreement shall be in
writing, personally delivered or mailed by certified mail, return receipt
requested (or in the form of telex or facsimile notice, followed by written
notice delivered as aforesaid or postage prepaid, first class mail), and shall
be deemed to have been duly given upon receipt;
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(a) in the case of the Seller, to
Xxxxx Fargo Bank South Dakota, National Association
000 X. Xxxxxxxx Xxxxxx
Xxxxx Xxxxx, XX 00000
Attention: Senior Regional Credit Officer
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(b) in the case of the Depositor, to
Xxxxx Fargo Student Loans Receivables I, LLC
Sixth and Marquette
Xxxxxxxxxxx, XX 00000
Attention: Xxxx Xxxxxxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(c) in the case of the Servicer, to
Xxxxx Fargo Bank South Dakota, National Association
000 00xx Xxxxxx, Xxxxx
Xxxxx Xxxxx, XX 00000
Attention: President
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(d) in the case of the Issuer, to
Xxxxx Fargo Student Loan Trust 0000-0
x/x Xxxxx Xxxxx Xxxx Xxxxxxxxx, National Association
Sixth and Marquette Avenue
MAC X0000-000
Xxxxxxxxxxx, XX 00000
Attention: Asset Backed Administration
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
with a copy to the Eligible Lender Trustee
at the Corporate Trust Office of the
Eligible Lender Trustee;
(e) in the case of the Issuer or the Eligible Lender
Trustee, at the Corporate Trust Office of the
Eligible Lender Trustee;
(f) in the case of the Indenture Trustee, at its
Corporate Trust Office;
19
(g) in the case of the Administrator, to
Xxxxx Fargo Bank Minnesota, National Association
Sixth and Marquette Avenue
MAC X0000-000
Xxxxxxxxxxx, XX 00000
Attention: Asset Backed Administration
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
(h) in the case of Fitch, to
Fitch, Inc.
Xxx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Asset Backed Monitoring Unit
Telephone: (000) 000-0000
Facsimile: (000) 000-0000;
(i) in the case of Xxxxx'x Investors Service, Inc.
00 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: ABS Monitoring Department
Telephone: (000) 000-0000
Facsimile: (000) 000-0000; and
(j) in the case of Standard & Poor's,
a division of The XxXxxx-Xxxx Companies, Inc. to
Standard & Poor's
00 Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Asset Backed Surveillance Department
Telephone: 000-000-0000
Facsimile: 000-000-0000
or, as to each of the foregoing, at such other address as shall be designated by
written notice to the other parties.
SECTION 6.04. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 4.04, this Agreement may not be
assigned by the Seller or the Depositor. This Agreement may be assigned by the
Eligible Lender Trustee only to its permitted successor pursuant to the Trust
Agreement or otherwise in accordance with Section 6.10.
SECTION 6.05. Limitations on Rights of Others. The provisions of
this Agreement are solely for the benefit of the Seller, the Depositor, the
Issuer, and the Eligible Lender Trustee and for the benefit of the Indenture
Trustee, the Noteholders and nothing in this Agreement, whether
20
express or implied, shall be construed to give to any other Person
any legal or equitable right, remedy or claim in the Trust Estate or under or in
respect of this Agreement or any covenants, conditions or provisions contained
herein.
SECTION 6.06. Severability. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof, and any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
SECTION 6.07. Separate Counterparts. This Agreement may be executed by
the parties hereto in separate counterparts, each of which when so executed and
delivered shall be an original, but all such counterparts shall together
constitute but one and the same instrument.
SECTION 6.08. Headings. The headings of the various Articles and
Sections herein are for convenience of reference only and shall not define or
limit any of the terms or provisions hereof.
SECTION 6.09. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
SECTION 6.10. Assignment to Indenture Trustee. The Seller and the
Depositor hereby acknowledge and consent to any mortgage, pledge, assignment and
grant by the Issuer to the Indenture Trustee pursuant to the Indenture for the
benefit of the Noteholders of a security interest in all right, title and
interest of the Issuer in, to and under the Financed Student Loans or the
assignment of any or all of the Issuer's rights and obligations hereunder to the
Indenture Trustee.
SECTION 6.11. Non-Petition Covenants. Notwithstanding any prior
termination of this Agreement, the Seller shall not, prior to the date which is
one year and one day after the termination of this Agreement with respect to the
Issuer or the Depositor, acquiesce, petition or otherwise invoke or cause the
Issuer or the Depositor to invoke the process of any court or government
authority for the purpose of commencing or sustaining a case against the Issuer
or the Depositor under any Federal or state bankruptcy, insolvency or similar
law or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Issuer or the Depositor or any
substantial part of its property, or ordering the winding up or liquidation of
the affairs of the Issuer or the Depositor.
SECTION 6.12. Limitation of Liability of Eligible Lender Trustee and
Indenture Trustee.
(a) Notwithstanding anything contained herein to the contrary (other
than as provided in subsection (d)), this Agreement has been signed by Bank One,
not in its individual
21
capacity but solely in its capacity as Eligible Lender Trustee of the
Depositor and the Issuer and in no event shall Bank One in its individual
capacity or, except as expressly provided in the Trust Agreement, as beneficial
owner of the Issuer have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto as to all of
which recourse shall be had solely to the assets of the Issuer.
(b) Notwithstanding anything contained herein to the contrary (other
than as provided in subsection (d)), this Agreement has been accepted by
JPMorgan Chase Bank not in its individual capacity but solely as Indenture
Trustee and in no event shall JPMorgan Chase Bank have any liability for the
representations, warranties, covenants, agreements or other obligations of the
Issuer hereunder or in any of the certificates, notices or agreements delivered
pursuant hereto, as to all of which recourse shall be had solely to the assets
of the Issuer.
(c) Notwithstanding any other provision in this Agreement or the
other Basic Documents, nothing in this Agreement or the other Basic Documents
shall be construed to limit the legal responsibility of the Eligible Lender
Trustee or the Indenture Trustee, to the U.S. Secretary of Education or a
Guarantor for any violations of statutory or regulatory requirements that may
occur with respect to loans held by the Eligible Lender Trustee or the
Indenture Trustee pursuant to, or to otherwise comply with their obligations
under, the Higher Education Act or implementing regulations.
SECTION 6.13. Agreement of Seller and Depositor. The Seller agrees to
execute and deliver such instruments and to take such actions as the Eligible
Lender Trustee, the Issuer or the Indenture Trustee may reasonably request in
order to effectuate the terms and carry out the purposes of the Agreement. The
Depositor agree to execute and deliver such instruments and to take such actions
as the Eligible Lender Trustee, the Issuer or the Indenture Trustee may
reasonably request in order to effectuate the terms and carry out the purposes
of the Agreement.
[Signatures Follow on Next Page]
22
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective officers as of the day and year first above
written.
XXXXX FARGO STUDENT LOAN TRUST 2001-1
By: BANK ONE, NATIONAL ASSOCIATION, not
in its individual capacity but solely as
Eligible Lender Trustee on behalf of the
Issuer
By: /s/ Xxxxxx XxXxxxx
-------------------------------------
Name: Xxxxxx XxXxxxx
Title: Vice President
XXXXX FARGO STUDENT LOANS RECEIVABLES
I, LLC
By: /s/ Xxx X. Xxxxxx
-------------------------------------
Name: Xxx X. Xxxxxx
Title: President and CEO
BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Eligible Lender
Trustee on behalf of Xxxxx
Fargo Student Loans Receivables
I, LLC
By: /s/ Xxxxxx XxXxxxx
-------------------------------------
Name: Xxxxxx XxXxxxx
Title: Vice President
Acknowledged and accepted as of the day and year first above written:
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Indenture Trustee
By: /s/ Xxxxxxxx X. Xxxxx
-----------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Assistant Vice President
23
SCHEDULE A
[List of Initial Financed Student Loans]
[Provided at Closing and on file with Indenture Trustee]
SA-1
EXHIBIT A
TO THE LOAN SALE AGREEMENT
XXXX OF SALE
For $_______ received, in accordance with the Loan Sale
Agreement (the "Loan Sale Agreement") dated as of November 1, 2001, among Xxxxx
Fargo Bank South Dakota, National Association, as seller (the "Seller"), Xxxxx
Fargo Student Loans Receivables I, LLC, as depositor (the "Depositor"), Xxxxx
Fargo Student Loan Trust 2001-1 (the "Issuer") and Bank One, National
Association, not in its individual capacity but solely as Eligible Lender
Trustee (the "Eligible Lender Trustee"), the Seller does hereby sell, assign,
transfer and otherwise convey unto the Depositor and, with respect to legal
title, unto the Eligible Lender Trustee on behalf of the Depositor, without
recourse (subject to the obligations set forth in the Loan Sale Agreement), all
right, title and interest in and to (i) the Initial Financed Student Loans and
all obligations of the Obligors thereunder, together with all documents, the
related Student Loan Files and all rights and privileges related thereto, (ii)
all payments and/or collections received thereunder on and after the Cutoff
Date, including without limitation, Liquidation Proceeds and Recoveries, (iii)
all funds on deposit from time to time in the Trust Accounts, including the
Reserve Account Initial Deposit and the Prefunding Account Closing Date Deposit,
and in all investments and proceeds thereof (including all income thereon) and
(iv) all proceeds of any and all of the foregoing (including but not limited to
proceeds derived from the voluntary or involuntary conversion of any of the
Initial Financed Student Loans into cash or other liquidated property, such as
proceeds from the applicable Guarantee Agreement).
Immediately after the purchase and sale described above and in
Section 2.01(a) of the Loan Sale Agreement, but otherwise concurrently with the
execution and delivery hereof, the Depositor (and, with respect to legal title
to the Initial Financed Student Loans, Bank One, National Association, as
Eligible Lender Trustee on behalf of the Depositor), does hereby sell, assign
and otherwise convey to the Issuer (and, with respect to the legal title to the
Initial Financed Student Loans, to the Eligible Lender Trustee on behalf of the
Issuer) without recourse (subject to the Depositor's obligations set forth in
the Loan Sale Agreement and except as may be provided in the Loan Sale
Agreement), (i) all right, title and interest in and to the Initial Financed
Student Loans, and all obligations of the Obligors thereunder, together with all
documents, the related Student Loan Files and all rights and privileges relating
thereto, (ii) all payments on or collections received thereunder on and after
the Cutoff Date, including without limitation, Liquidation Proceeds and
Recoveries; (iii) all of its right, title and interest in all funds on deposit
from time to time in the Trust Accounts, including the Reserve Account Initial
Deposit and the Prefunding Account Closing Date Deposit, and in all investments
and proceeds thereof (including all income thereon); (iv) all of its right,
title and interest in and to the Loan Sale Agreement with respect to each
Initial Financed Student Loan; (v) all of its right, title and interest in and
to the Demand Note; and (vi.) all proceeds of any and all of the foregoing. The
foregoing sale does not constitute and is not intended to result in any
assumption by the Eligible Lender Trustee, the Depositor or the Issuer of any
obligation of the Seller to the borrowers of
A-1
Initial Financed Student Loans or any other Person in connection with
the Initial Financed Student Loans or any agreement or instrument relating to
any of them.
In addition, the undersigned, by execution of this instrument,
hereby endorses the promissory notes evidencing each Initial Financed Student
Loan described in Schedule A to the Loan Sale Agreement in favor of the Eligible
Lender Trustee on behalf of the Issuer, without recourse (subject to the
obligations set forth in the Loan Sale Agreement) against the undersigned. This
endorsement may be effected by attaching a facsimile hereof to each or any of
such promissory notes.
This Xxxx of Sale is made pursuant to and upon the
representations, warranties and agreements on the part of the undersigned
contained in the Loan Sale Agreement and is to be governed by the Loan Sale
Agreement.
Capitalized terms used but not defined herein shall have the
meaning assigned to them in Appendix A to the Administration Agreement, dated as
of November 1, 2001, among Xxxxx Fargo Student Loan Trust 2001-1, as Issuer,
Xxxxx Fargo Bank Minnesota, National Association as Administrator, and JPMorgan
Chase Bank, as Indenture Trustee, which also contains rules as to usage that
shall be applicable herein.
IN WITNESS WHEREOF, the undersigned has caused this Xxxx of
Sale to be duly executed as of November 1, 2001.
XXXXX FARGO BANK SOUTH DAKOTA,
NATIONAL ASSOCIATION,
as Seller
By:_________________________________
Name:
Title:
XXXXX FARGO STUDENT LOAN RECEIVABLES I, LLC,
as Depositor
By:_________________________________
Name:
Title:
XXXXX FARGO STUDENT LOAN TRUST 2001-1
By: BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Eligible Lender Trustee on
behalf of the Issuer
A-2
By: __________________________
Name:
Title:
BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Eligible Lender Trustee on
behalf of the Depositor
By: ______________________
Name:
Title:
A-3
EXHIBIT B
TO THE
LOAN SALE AGREEMENT
TRANSFER AGREEMENT
TRANSFER No. _____ of [PREFUNDED LOANS] [SERIAL LOANS] dated
as of ______________, _____, among XXXXX FARGO STUDENT LOAN TRUST 2001-1, a
Delaware trust (the "Issuer"), XXXXX FARGO BANK SOUTH DAKOTA, NATIONAL
ASSOCIATION, as seller (the "Seller"), XXXXX FARGO STUDENT LOANS RECEIVABLES I,
LLC, as depositor (the "Depositor"), and BANK ONE, NATIONAL ASSOCIATION, a
national banking association, not in its individual capacity but solely as
Eligible Lender Trustee of the Depositor and the Issuer (the "Eligible Lender
Trustee").
W I T N E S S E T H:
WHEREAS, the Issuer, the Seller, the Depositor and the
Eligible Lender Trustee are parties to the Loan Sale Agreement dated as of
November 1, 2001 (as amended or supplemented, the "Loan Sale Agreement"); and
WHEREAS, the Seller, the Depositor, and the Eligible Lender
Trustee are parties to the Trust Agreement dated as of November 1, 2001 (as
amended or supplemented, the "Trust Agreement"); and
WHEREAS, pursuant to the Loan Sale Agreement, the Seller
wishes to convey the [Prefunded Loans] [Serial Loans] referred to in Section 2
(the "Additional Student Loans") to the Eligible Lender Trustee on behalf of the
Depositor ; and
WHEREAS, pursuant to the Loan Sale Agreement, the Depositor
wishes to convey the Additional Student Loans to the Eligible Lender Trustee on
behalf of the Issuer; and
WHEREAS, the Eligible Lender Trustee, the Depositor and the
Issuer are willing to accept such conveyance subject to the terms and conditions
hereof.
NOW, THEREFORE, the parties hereto hereby agree as follows:
1. Definitions and Usage. Unless otherwise defined herein,
capitalized terms used herein shall have the meanings ascribed to them in
Appendix A to the Administration Agreement, dated as of November 1, 2001, among
the Issuer, Xxxxx Fargo Bank Minnesota, National Association, as Administrator,
and JPMorgan Chase Bank, as Indenture Trustee, which also contains rules of
construction and usage that shall be applicable herein.
In addition, the following terms have the following meanings:
"Subsequent Cutoff Date" means, with respect to each
Additional Student Loan, the date specified as such on Schedule A hereto.
B-1
"Transfer Date" means, with respect to the Additional Student
Loans, ________________, _______.
2. Schedule of Financed Student Loans. Attached hereto as
Schedule A is a supplement to Schedule A to the Loan Sale Agreement listing the
Additional Student Loans to be conveyed on the Transfer Date to the Eligible
Lender Trustee on behalf of the Issuer pursuant to this Agreement.
3. Conveyance of Additional Student Loans. In consideration of
Issuer's delivery to or upon the order of the Depositor and the Depositor's
delivery to or upon the order of the Seller of $__________, for Additional
Student Loans during the Funding Period, such amount being the Loan Purchase
Amounts of the Additional Student Loans and such amount to be paid from amounts
on deposit in the Prefunding Account subject to the provisions of Section
2.02(b) of the Loan Sale Agreement and Section 2(f) of the Administration
Agreement and after the Funding Period such amount being the sum of the
principal balance of such loan owed by the related borrower plus accrued
borrower interest thereon, the Seller does hereby sell, assign and otherwise
convey, without recourse (except as expressly provided in the Loan Sale
Agreement), to the Eligible Lender Trustee on behalf of the Depositor and
immediately thereafter, the Depositor (and with respect to legal title of the
Additional Student Loans, Bank One as Eligible Lender Trustee on behalf of the
Depositor) does hereby sell, assign and otherwise convey, without recourse
(except as expressly provided in the Loan Sale Agreement), to the Eligible
Lender Trustee on behalf of the Issuer:
(a) All right, title and interest in and to the
Additional Student Loans and all obligations of the Obligors
thereunder, together with all documents, the related Student
Loan Files and all rights and privileges relating thereto;
(b) all payments on or collections received
thereunder, on and after the related Subsequent Cutoff
Date;
(c) with respect to each such sale and conveyance by
the Depositor, all of the Depositor's right, title and
interest in and to the Loan Sale Agreement with respect to
such Prefunded Loan and Serial Loan; and
(d) all proceeds of any and all of the foregoing.
4. Conditions Precedent. The obligation of the Depositor and
the Issuer to acquire the Additional Student Loans hereunder is subject to the
satisfaction, on or prior to the Transfer Date, of the following conditions
precedent:
(a) Representations and Warranties. Each of the
representations and warranties made by the Seller in Sections
3.01 and 4.01 of the Loan Sale Agreement shall be true and
correct as of the Transfer Date.
B-2
(b) Loan Sale Agreement Conditions. Each of the
conditions set forth in Section 2.02(d) and in Section 4.02
of the Loan Sale Agreement shall have been satisfied.
(c) Delivery of Xxxx of Sale. The Seller and the
Depositor, as applicable, shall have delivered a Xxxx of Sale
substantially in the form of Annex A hereto.
(d) Additional Information. The Seller shall have
delivered to the Depositor and the Issuer such information as
was reasonably requested by the Depositor or the Issuer, as
applicable (such reasonableness to be determined solely by the
Seller) to satisfy itself as to (i) the accuracy of the
representations and warranties set forth in Sections 3.01 and
4.01 of the Loan Sale Agreement and (ii) the satisfaction of
the conditions set forth in this Section 4.
5. Ratification of Agreement. As supplemented by this
Agreement, the Loan Sale Agreement is in all respects ratified and confirmed and
the Loan Sale Agreement as so supplemented by this Agreement shall be read,
taken and construed as one and the same instrument.
6. Third-Party Beneficiaries. The Indenture Trustee is an
express third-party beneficiary and may enforce the provisions of this Agreement
as if it were a party hereto.
7. Counterparts. This Agreement may be executed in separate
counterparts, each of which when so executed and delivered shall be an original,
but all of which together shall constitute but one and the same instrument.
8. Governing Law. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
9. Headings. The section headings hereof have been inserted
for convenience of reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.
B-3
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed and delivered by their respective duly authorized
officers as of the day and the year first above written.
XXXXX FARGO STUDENT LOAN TRUST 2001-1
By: BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Eligible Lender Trustee
on behalf of the Issuer
By: ____________________________________
Name:
Title:
BANK ONE NATIONAL ASSOCIATION, not in its
individual capacity but solely as
Eligible Lender Trustee on behalf of the
Depositor
By: ____________________________________
Name:
Title:
XXXXX FARGO STUDENT LOANS
RECEIVABLES I, LLC,
as Depositor
By:_________________________________
Name:
Title:
XXXXX FARGO BANK SOUTH DAKOTA,
NATIONAL ASSOCIATION,
as Seller
By: ____________________________________
Name:
Title:
Acknowledged and accepted as of the date first above written:
JPMORGAN CHASE BANK,
not in its individual
capacity but solely as
Indenture Trustee
B-4
By:_________________________________
Name:
Title:
B-5
SCHEDULE A
TO THE
TRANSFER AGREEMENT NO. ___
[List of Additional Student Loans
and their related Subsequent Cutoff Dates]
B-6
ANNEX A
TO THE TRANSFER AGREEMENT
XXXX OF SALE
For value received, in accordance with the Loan Sale Agreement
(the "Loan Sale Agreement") dated as of November 1, 2001, among XXXXX FARGO BANK
SOUTH DAKOTA, NATIONAL ASSOCIATION, as seller (the "Seller"), XXXXX FARGO
STUDENT LOANS RECEIVABLES I, LLC, as depositor (the "Depositor"), XXXXX FARGO
STUDENT LOAN TRUST 2001-1 (the "Issuer") and BANK ONE, NATIONAL ASSOCIATION, not
in its individual capacity but solely as Eligible Lender Trustee (the "Eligible
Lender Trustee") [and as ratified by [name of eligible lender if other than BANK
ONE, NATIONAL ASSOCIATION with respect to the Additional Student Loans] pursuant
to Section 4.02 of the Loan Sale Agreement] and the Transfer Agreement No. ____
dated as of ________, ____ (the "Transfer Agreement") among the Seller, the
Depositor, the Issuer and the Eligible Lender Trustee, the Seller does hereby
sell, assign, transfer and otherwise convey unto the Depositor, and with respect
to legal title, unto the Eligible Lender Trustee on behalf of the Depositor,
without recourse (subject to the obligations set forth in the Loan Sale
Agreement), and immediately thereafter the purchase and sale described above but
otherwise concurrently with the execution and delivery hereof, the Depositor
(and with respect to legal title, Bank One as Eligible Lender Trustee on behalf
of the Depositor) does hereby sell, assign, transfer and otherwise convey unto
the Issuer and, with respect to legal title, unto the Eligible Lender Trustee on
behalf of the Issuer, without recourse (subject to the obligations set forth in
the Loan Sale Agreement), all right, title and interest in and to (i) the
Additional Student Loans and all obligations of the Obligors thereunder,
together with all documents, the related Student Loan Files and all rights and
privileges related thereto, (ii) all payments and collections received
thereunder, on and after the Subsequent Cutoff Date, including without
limitation, Liquidation Proceeds and Recoveries; (iii) with respect to each such
sale and conveyance by the Depositor, all of the Depositor's right, title and
interest in and to the Loan Sale Agreement with respect to each such Prefunded
Loan and Serial Loan and (iv) all proceeds of any and all of the foregoing
(including but not limited to proceeds derived from the voluntary or involuntary
conversion of any of the Additional Student Loans into cash or other liquidated
property, such as proceeds from the applicable Guarantee Agreement). The
foregoing sale does not constitute and is not intended to result in any
assumption by the Eligible Lender Trustee, the Depositor or the Issuer of any
obligation of the Seller to the borrowers of the Additional Student Loans or any
other Person in connection with the Additional Student Loans or any agreement or
instrument relating to any of them.
In addition, the undersigned, by execution of this instrument,
hereby endorses the promissory notes evidencing each Additional Student Loan
described in Schedule A to the Transfer Agreement in favor of the Eligible
Lender Trustee on behalf of the Depositor or the Issuer, as applicable, without
recourse (subject to the obligations set forth in the Loan Sale Agreement)
against the undersigned. This endorsement may be effected by attaching a
facsimile hereof to each or any of such promissory notes.
B-7
This Assignment is made pursuant to and upon the
representations, warranties and agreements on the part of the undersigned
contained in the Loan Sale Agreement and the Transfer Agreement and is to be
governed by the Loan Sale Agreement and the Transfer Agreement.
Capitalized terms used but not defined herein shall have the
meanings assigned to them in the Transfer Agreement.
B-8
IN WITNESS WHEREOF, the undersigned has caused this Xxxx of
Sale to be duly executed as of ________________, ______.
XXXXX FARGO BANK SOUTH DAKOTA,
NATIONAL ASSOCIATION
as Seller
By: ____________________________________
Name:
Title:
XXXXX FARGO STUDENT LOANS
RECEIVABLES I, LLC
as Depositor
By: ____________________________________
Name:
Title:
XXXXX FARGO STUDENT LOAN TRUST 2001-1
By: BANK ONE, NATIONAL ASSOCIATION, not in
its individual capacity but solely as
trustee on behalf of the Issuer
By: __________________________
Name:
Title:
BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity
but solely as Eligible Lender
Trustee on behalf of the
Depositor
By: __________________________
Name:
Title:
B-9
EXHIBIT C
TO THE LOAN SALE AGREEMENT
1. Characteristics of Financed Student Loans. Each Financed
Student Loan (A) was originated in the United States of America, its
territories, its possessions or other areas subject to its jurisdiction by an
"eligible lender" under the Higher Education Act in the ordinary course of its
business to an eligible borrower under applicable law and agreements and was
fully and properly executed by the parties thereto, (B) was acquired or
originated by the Seller in the ordinary course of its business, (C) provides
or, when the payment schedule with respect thereto is determined, will provide
for payments on a periodic basis that fully amortizes the principal amount of
such Financed Student Loan by its maturity, as such maturity may be modified in
accordance with any applicable deferral or forbearance periods granted in
accordance with applicable laws and restrictions, including those of the Higher
Education Act or the applicable Guarantee Agreement, and yield interest at the
rate applicable thereto, and (D) provides that the rights with respect thereto
are assignable by the lender thereunder and its assignees without the consent of
or notice to any person other than as may be required by the Higher Education
Act and such notice has been or will be given. Each Financed Student Loan is
guaranteed by an eligible guarantor under the Higher Education Act and qualifies
the holder thereof to receive Interest Subsidy Payments (other than SLS Loans,
unsubsidized Xxxxxxxx Loans, and those Consolidation Loans for which the related
loan application was submitted prior to January 1, 1993) and Special Allowance
Payments from the Department and Guarantee Payments from the Guarantor and
qualifies the Guarantor to receive reinsurance payments thereon from the
Department. If such Financed Student Loan is a Prefunded Loan, or a Qualified
Substitute Loan and is, in either case, guaranteed by an Additional Guarantor,
the aggregate principal balance of all Financed Student Loans guaranteed by such
Additional Guarantor (measured as of the Subsequent Cutoff Date for such
Financed Student Loan) following the addition of such Financed Student Loan to
the Issuer, did not exceed 5% of the principal balance of all Financed Student
Loans as of such date, and the aggregate principal balance of all Financed
Student Loans guaranteed by all Additional Guarantors measured as of such date,
following such addition, did not exceed 20% of the principal balance of all
Financed Student Loans as of such date. The principal balance of each Financed
Student Loan is not subject to change by reason of adjustments to the related
Borrower's account after the Cutoff Date relating to matters or events occurring
prior to the Cutoff Date.
2. Schedule of Financed Student Loans. The information set
forth in Schedule A to this Agreement is true and correct in all material
respects as of the opening of business on the Cutoff Date with respect to the
Initial Financial Student Loans and the Subsequent Cutoff Date, with respect to
the Prefunded Loans and Serial Loans. With respect to any Consolidation Loan
originated by the Issuer or any Prefunded Loan or Serial Loan conveyed to the
Issuer after the Closing Date, information for each category set forth in
Schedule A has been provided with respect to such loan and such information is
true and correct in all material respects, as of the date of origination, in the
case of such Consolidation Loan, and as of the opening of business on the
applicable Subsequent Cutoff Date in the case of a Prefunded Loan,
C-1
Serial Loan. With respect to any Consolidation Loan, the principal balance of
which has been increased by the principal balance of any related Add-on
Consolidation Loan, information for each category set forth in Schedule A
has been provided with respect to such Add-on Consolidation Loan and
such information is true and correct in all material respects as of the related
Add-on Consolidation Loan Funding Date. No selection procedures believed to be
adverse to the Noteholders were utilized in selecting any Financed Student Loan.
The computer tape regarding the Initial Financed Student Loans made available to
the Issuer and its assigns is true and correct in all respects as of the Cutoff
Date, and, after the Closing Date, any computer tape regarding any Consolidation
Loan, Prefunded Loan, Qualified Substitute Student or Serial Loan made available
to the Issuer and its assigns is true and correct in all respects as of the date
of origination, in the case of a Consolidation Loan originated by the Issuer, as
of the applicable Add-on Consolidation Loan Funding Date, in the case of a
Consolidation Loan the principal balance of which is increased by the principal
balance of any related Add-on Consolidation Loan, and as of the applicable
Subsequent Cutoff Date, in the case of a Prefunded Loan, Qualified Substitute
Student or Serial Loan .
3. Compliance with Law. Each Financed Student Loan complied at
the time of origination and at the time of the execution of this Agreement or
the applicable Transfer Agreement or Assignment, as the case may be, at the time
of origination in the case of a Consolidation Loan originated by the Issuer and
as of the applicable Add-on Consolidation Loan Funding Date in the case of a
Consolidation Loan the principal balance of which is increased by the principal
balance of any Add-on Consolidation Loan, in all material respects with all
applicable requirements of local, state, and federal laws, rules and regulations
which govern the making of such Financed Student Loan including the requirements
of the applicable Guarantee Agreement.
4. Binding Obligation. The terms and conditions of each
Financed Student Loan are consistent with the application of the Borrower, all
signatures for the Financed Student Loans are genuine and the Borrower Note
evidencing each Financed Student Loan has been duly executed and delivered and
constitutes the legal, valid, and binding obligation of the Borrower enforceable
in accordance with its terms.
5. No Defenses. No right of rescission, setoff, counterclaim,
or defense has been asserted or threatened or exists with respect to any
Financed Student Loan.
6. No Default. No Financed Student Loan has a payment that is
more than 270 days overdue as of the Cutoff Date or more than 180 days overdue
as of the applicable Subsequent Cutoff Date, as the case may be, and, except as
permitted in this paragraph, no default, breach, violation or event permitting
acceleration under the terms of any Financed Student Loan has occurred; and,
except for payment defaults continuing for a period of not more than 270 days or
180 days, as applicable, no continuing condition that with notice or the lapse
of time or both would constitute a default, breach, violation or event
permitting acceleration under the terms of any Financed Student Loan has arisen;
the Seller has not waived and shall not waive
C-2
any of the foregoing other than as permitted by the Basic Documents; and as of
the Cutoff Date, not more than 20% of the Initial Financed Student Loans are
more than 30 days overdue.
7. Title. It is the intention of the Seller that the transfer
and assignment herein contemplated constitute a sale of the Financed Student
Loans from the Seller to the Eligible Lender Trustee on behalf of the Issuer and
that the beneficial interest in and title to such Financed Student Loans not be
part of the estate of the Seller in the event of the appointment of a receiver
with respect to the Seller. Except in the case of Consolidation Loans originated
by the Issuer, immediately prior to the transfer and sale of each Financed
Student Loan to the Issuer, each Borrower Note is owned by the Seller and the
Seller has good title to each Financed Student Loan, free and clear of any lien,
charge, encumbrance, or other interest therein and immediately upon the transfer
and sale of such Financed Student Loan to the Depositor, the Depositor has
transferred and sold such Financed Student Loan to the Issuer and the Eligible
Lender Trustee on behalf of the Depositor has good title to such Financed
Student Loan free and clear of any lien, charge, encumbrance, or other interest
therein except as contemplated by the Basic Documents.
8. All Filings Made. All filings (including UCC filings)
necessary in any jurisdiction to give the Eligible Lender Trustee on behalf of
the Issuer a first perfected ownership interest in the Financed Student Loans,
and to give the Indenture Trustee a first perfected security interest therein,
have been made.
9. No Bankruptcies. No Borrower of any Financed Student Loan
as of the Cutoff Date or the applicable Subsequent Cutoff Date (in the case of
Qualified Substitute Student Loans, Prefunded Loans or Serial Loans), as of the
date of origination (in the case of a Consolidation Loan originated by the
Issuer) or as of the applicable Add-on Consolidation Loan Funding Date (in the
case of a Consolidation Loan the principal balance of which is increased by the
principal balance of any related Add-on Consolidation Loan) was noted in the
related Student Loan File as being currently involved in a bankruptcy
proceeding.
10. Lawful Assignment. No Financed Student Loan has been
originated in, or is subject to the laws of, any jurisdiction under which the
origination, sale, transfer and assignment of such Financed Student Loan or any
Financed Student Loan under this Agreement, each Transfer Agreement or the
Indenture is unlawful, void or voidable.
11. One Original. There is only one original executed
promissory note evidencing each Financed Student Loan.
12. U.S. Obligors. Less than 2.0% of the Financed Student
Loans are due from Persons not having a mailing address in the United States of
America.
13. Interest Accruing. Each Financed Student Loan is accruing
interest (whether or not such interest is being paid currently, by the Borrower
or by the Department, or is being capitalized) at the maximum interest rate
permitted by the Higher Education Act and qualifies for Special Allowance
Payments, except as expressly permitted by the Basic Documents.
C-3
14. Seller's Representations. The representations and
warranties of the Seller contained in Section 4.01 are true and correct.
C-4
EXHIBIT D
TO THE LOAN SALE AGREEMENT
1. Organization and Good Standing. The Seller is a national
banking association duly organized, validly existing and in good standing under
the laws of the United States and is an "eligible lender" for purposes of the
Higher Education Act.
2. Power and Authority of the Seller. The Seller has full
legal power and authority to execute and deliver this Agreement and to carry out
its terms; the Seller has full legal power and authority to sell and assign the
property to be sold and assigned to and deposited with the Depositor (or with
the Eligible Lender Trustee on behalf of the Depositor) and the Seller has duly
authorized such sale and assignment to the Depositor (or to the Eligible Lender
Trustee on behalf of the Depositor) by all necessary action; and the execution,
delivery and performance of this Agreement have been duly authorized by the
Seller by all necessary action.
3. Binding Obligation. This Agreement has been executed and
delivered by the Seller and, assuming authorization, execution, and delivery by
the other parties thereto, this Agreement constitutes a valid obligation of the
Seller enforceable against it in accordance with the express terms of this
Agreement, except as enforcement thereof may be limited by the bankruptcy,
insolvency, reorganization, moratorium, liquidation, readjustment of debt, or
other federal or state laws or equitable principles relating to or affecting the
enforcement of creditor's rights.
4. No Violation. The consummation of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof or
thereof do not conflict with, result in any material breach of any of the terms
and provisions of, nor constitute (with or without notice or lapse of time or
both) a material default under, the charter or by-laws of the Seller, or any
indenture, agreement or other instrument to which the Seller is a party or by
which it shall be bound; nor result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than pursuant to the Basic Documents); nor
violate any law or, to the knowledge of the Seller, any order, rule or
regulation applicable to the Seller of any court or of any Federal or state
regulatory body, administrative agency or other governmental instrumentality
having jurisdiction over the Seller or its properties.
5. No Proceedings. There is no action, suit, claim,
investigation, or proceeding, in any such case whether pending or to the
knowledge of the Seller, threatened against the Seller before any court,
governmental agency, or arbitrator (i) asserting the invalidity of this
Agreement or the transactions contemplated hereby, (ii) seeking to prevent the
consummation of any transactions contemplated by this Agreement, (iii) seeking
any determination or ruling that could reasonably be expected to have a material
and adverse effect on the performance by the Seller of its obligations under, or
the validity or enforceability of, this Agreement or (iv) seeking to affect
adversely the Federal or state income tax attributes of the Issuer or the Notes.
D-1
6. All Consents. No action, including, without limitation, the
granting or issuing of any consent, permit, license, approval, or authorization
is required to be made on or prior to the date of this Agreement in connection
with the sale of Financed Student Loans under this Agreement (with the possible
exception of routine filings which, if not made, will not render the Seller
liable to any material penalties or will not result in the transactions
contemplated by this Agreement being subject to challenge) except such actions,
if any, as have been taken.
7. Official Record. This Agreement and all other documents
related hereto to which the Seller is a party have been approved by the Seller's
board of directors, which approval is reflected in the minutes of such board,
and shall continuously from time to time of each such document's execution, be
maintained as an official record of the Seller.
D-2
EXHIBIT E
TO THE LOAN SALE AGREEMENT
1. Organization and Good Standing. Bank One is a national
banking association duly organized, validly existing and in good standing under
the laws of the United States and is an "eligible lender" for purposes of the
Higher Education Act.
2. Power and Authority of the Bank One. Bank One has
authorized the execution and delivery of this Agreement and has full legal power
and authority to consummate all transactions contemplated by this Agreement and
any and all other agreements relating hereto.
3. Binding Obligation. This Agreement has been executed and
delivered by Bank One and, assuming authorization, execution, and delivery by
the other parties thereto, this Agreement constitutes a valid obligation of Bank
One enforceable against it in accordance with the express terms of this
Agreement, except as enforcement thereof may be limited by the bankruptcy,
insolvency, reorganization, moratorium, liquidation, readjustment of debt, or
other federal or state laws or equitable principles relating to or affecting the
enforcement of creditor's rights.
4. No Violation. Compliance by Bank One with this Agreement
does not in any material respect violate any law or regulation by which Bank One
or its assets are bound, or any writ, order, judgment, or decree of any court or
government instrumentality or arbitrator in which Bank One is named, or the
charter or by-laws of Bank One or any indenture, contract, or agreement to which
Bank One is a party or by which it is or its properties are bound or affected.
5. No Proceedings. There is no action, suit, claim,
investigation, or proceeding, in any case pending or, to the knowledge of Bank
One, threatened against Bank One before any court, governmental agency, or
arbitrator which, if decided adversely to Bank One, is likely to have a material
adverse effect upon the validity or enforceability of this Agreement.
6. All Consents. No action, including, without limitation, the
granting or issuing of any consent, permit, license, approval, or authorization
which is required to be made on or prior to the date of this Agreement in
connection with the sale of Financed Student Loans under this Agreement (with
the possible exception of routine filings which, if not made, will not render
Bank One liable to any material penalties or will not result in the transactions
contemplated by this Agreement being subject to challenge) is required.
E-1
EXHIBIT F
TO THE LOAN SALE AGREEMENT
ASSIGNMENT
For value received, in accordance with the Loan Sale Agreement
(the "Loan Sale Agreement") dated as of November 1, 2001, among XXXXX FARGO BANK
SOUTH DAKOTA, NATIONAL ASSOCIATION as seller (the "Seller"), XXXXX FARGO STUDENT
LOAN TRUST 2001-1 (the "Issuer"), XXXXX FARGO STUDENT LOANS RECEIVABLES, LLC
(the "Depositor") and BANK ONE, NATIONAL ASSOCIATION, not in its individual
capacity but solely as Eligible Lender Trustee (the "Eligible Lender Trustee"),
the Seller does hereby sell, assign, transfer and otherwise convey unto the
Eligible Lender Trustee on behalf of the Depositor, without recourse (subject to
the obligations set forth in the Loan Sale Agreement), all right, title and
interest in and to (i) the Qualified Substitute Student Loan(s) indicated in
Schedule A hereto (the "Additional Student Loans") and all obligations of the
Obligors thereunder, together with all documents, the related Student Loan Files
and all rights and privileges related thereto, (ii) all payments on or
collections received thereunder on and after the date hereof, including without
limitation, Liquidation Proceeds and Recoveries and (iii) all proceeds of any
and all of the foregoing (including but not limited to proceeds derived from the
voluntary or involuntary conversion of any of the Additional Student Loans into
cash or other liquidated property, such as proceeds from the applicable
Guarantee Agreement).
Immediately after the purchase and sale described above and in
Section 2.01(a) of the Loan Sale Agreement, but otherwise concurrently with the
execution and delivery hereof, the Depositor (and, with respect to legal title
to the Additional Financed Student Loans, Bank One, National Association, as
Eligible Lender Trustee on behalf of the Depositor), does hereby sell, assign
and otherwise convey to the Issuer (and, with respect to the legal title to the
Additional Financed Student Loans, to the Eligible Lender Trustee on behalf of
the Issuer) without recourse (subject to the Depositor's obligations set forth
in the Loan Sale Agreement and except as may be provided in the Loan Sale
Agreement), (i) all right, title and interest in and to the Additional Financed
Student Loans, and all obligations of the Obligors thereunder, together with all
documents, the related Student Loan Files and all rights and privileges relating
thereto, (ii) all payments on or collections received thereunder on and after
the date hereof, including without limitation, Liquidation Proceeds and
Recoveries; (iii) all of its right, title and interest in and to the Loan Sale
Agreement with respect to each Additional Student Loan; and (iv) all proceeds of
any and all of the foregoing (including but not limited to proceeds derived from
the voluntary or involuntary conversion of any of the Additional Student Loans
into cash or other liquidated property, such as proceeds from the applicable
Guarantee Agreement). The foregoing sale does not constitute and is not intended
to result in any assumption by the Eligible Lender Trustee, the Depositor or the
Issuer of any obligation of the Seller to the borrowers of the Additional
Student Loans or any other Person in connection with the Additional Student
Loans or any agreement or instrument relating to any of them.
F-1
In addition, the undersigned, by execution of this instrument,
hereby endorse the promissory notes evidencing each Additional Student Loan in
favor of the Eligible Lender Trustee on behalf of the Issuer, without recourse
(subject to the obligations set forth in the Loan Sale Agreement) against the
undersigned. This endorsement may be effected by attaching a facsimile hereof to
each or any of such promissory notes.
This Assignment is made pursuant to and upon the
representations, warranties and agreements on the part of the undersigned
contained in the Loan Sale Agreement and is to be governed by the Loan Sale
Agreement.
Capitalized terms used but not defined herein shall have the
meaning assigned to them in Appendix A to the Administration Agreement, dated as
of November 1, 2001 among the Issuer, the Xxxxx Fargo Bank Minnesota, National
Association, as Administrator, and JPMorgan Chase Bank, as Indenture Trustee,
which also contains rules as to usage that shall be applicable herein.
F-2
IN WITNESS WHEREOF, the undersigned has caused this Agreement
to be duly executed as of November 1, 2001.
XXXXX FARGO BANK SOUTH DAKOTA,
NATIONAL ASSOCIATION,
as Seller
By: ____________________________________
Name:
Title:
XXXXX FARGO STUDENT LOANS RECEIVABLES I, LLC,
as Depositor
By: ____________________________________
Name:
Title:
XXXXX FARGO STUDENT LOAN TRUST 2001-1
By: BANK ONE, NATIONAL ASSOCIATION,
not in its individual capacity but
solely as Eligible Lender Trustee on behalf
of the Issuer
By: __________________________
Name:
Title:
BANK ONE, NATIONAL ASSOCIATION, not in its
individual capacity but solely as Eligible Lender
Trustee on behalf of the Depositor
By: __________________________
Name:
Title:
Accepted:
JPMORGAN CHASE BANK,
not in its individual capacity but
solely as Indenture Trustee
F-3
By:_________________________________
Name:
Title:
F-4
