PURCHASE AGREEMENT MASTER SECURITIZATION TERMS NUMBER 1000
These Purchase Agreement Master Securitization Terms Number 1000
("Master Terms") dated as of March 20, 1997 among SLM Funding Corporation
("Funding"), Chase Manhattan Bank USA, National Association, not in its
individual capacity but solely as Interim Eligible Lender Trustee (the "Interim
Eligible Lender Trustee") for the benefit of Funding under the Interim Trust
Agreement dated as of March 1, 1997 between Funding and the Interim Eligible
Lender Trustee, and Student Loan Marketing Association ("▇▇▇▇▇▇ ▇▇▇"), shall be
effective upon execution by the parties hereto. References to Funding herein
mean the Interim Eligible Lender Trustee for all purposes involving the holding
or transferring of legal title to the Eligible Loans.
WHEREAS, ▇▇▇▇▇▇ Mae is the owner of certain student loans guaranteed
under the Higher Education Act;
WHEREAS, ▇▇▇▇▇▇ ▇▇▇ may desire to sell its interest in such loans from
time to time and Funding may desire to purchase such loans from ▇▇▇▇▇▇ Mae;
WHEREAS, the Interim Eligible Lender Trustee is willing to hold legal
title to, and serve as eligible lender trustee with respect to, such loans on
behalf of Funding;
NOW, THEREFORE, in connection with the mutual promises contained
herein, the parties hereto agree as follows:
SECTION 1. TERMS
These Master Terms establish the terms under which ▇▇▇▇▇▇ ▇▇▇ may sell
and Funding (and with respect to legal title, the Interim Eligible Lender
Trustee on behalf of Funding) may purchase the Loans (and all obligations of the
Borrowers thereunder) specified on each Purchase Agreement as the parties may
execute from time to time pursuant to these Master Terms. Each such Purchase
Agreement shall be substantially in the form of Attachment A hereto,
incorporating by reference the terms of these Master Terms, and shall be a
separate agreement among ▇▇▇▇▇▇ Mae, Funding, and the Interim Eligible Lender
Trustee on behalf of Funding with respect to the Loans covered by the terms of
such Purchase Agreement. If the terms of a Purchase Agreement conflict with the
terms of these Master Terms, the terms of such Purchase Agreement shall
supersede and govern.
SECTION 2. DEFINITIONS
Capitalized terms used but not otherwise defined herein shall have the
definitions set forth in Appendix A hereto.
For purposes hereof:
(A) "Account" means all of the Eligible Loans hereunder of one (1)
Borrower that are of the same Loan type made under the identical
subsection of the Higher Education Act and in the same status.
(B) "▇▇▇▇ of Sale" means that document executed by an authorized
officer of ▇▇▇▇▇▇ Mae which shall set forth the Loans offered by ▇▇▇▇▇▇
Mae and accepted for purchase by the Interim Eligible Lender Trustee
for the benefit of Funding and which shall sell, assign and convey to
the Interim Eligible Lender Trustee for the benefit of Funding and its
assignees all rights, title and interest of ▇▇▇▇▇▇ ▇▇▇ in the Loans
listed on the ▇▇▇▇ of Sale and will certify that the representations
and warranties made by ▇▇▇▇▇▇ ▇▇▇ pursuant to Section 5(A) of these
Master Terms are true and correct.
(C) "Borrower" means the obligor on a Loan.
(D) "Consolidation Loan" means a Loan made pursuant to and in full
compliance with Section 428C of the Higher Education Act.
(E) "Cutoff Date" means with respect to the first sale hereunder, March
3, 1997, and, with respect to subsequent sales hereunder, a date agreed
to by ▇▇▇▇▇▇ Mae and Funding to use in determining the Principal
Balance and accrued interest to be capitalized for purposes of
completing the Loan Transmittal Summary Form.
(F) "Deferred Payment" means an amount equal to 66 2/3 of the amount
distributed to Funding pursuant to Section 2.8 C(G) of the
Administration Agreement (exclusive of the amount of any such
distribution attributable to the reduction from time to time of the
Specified Reserve Account Balance).
(G) "Delinquent" means the period any payment of principal or interest
due on the Loan is overdue.
(H) "Eligible Loan" means a Loan offered for sale by ▇▇▇▇▇▇ ▇▇▇ under
the Purchase Agreement which as of the Cutoff Date is current or no
more Delinquent than permitted under the Purchase Agreement in payment
of principal or interest and which meets the following criteria as of
the effective date of the ▇▇▇▇ of Sale:
(i) is a ▇▇▇▇▇▇▇▇ Loan, a Consolidation Loan, a PLUS Loan or
SLS Loan;
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(ii) is owned by ▇▇▇▇▇▇ Mae and is fully disbursed;
(iii) is guaranteed as to principal and interest by the
applicable Guarantor to the maximum extent permitted by the
Higher Education Act for such Loan;
(iv) bears interest at a stated rate of not less than the
maximum rate permitted under the Higher Education Act for such
Loan;
(v) is eligible for the payment of the quarterly special
allowance at the full and undiminished rate established under
the formula set forth in the Higher Education Act for such
Loan;
(vi) if not yet in repayment status, is eligible for the
payment of interest benefits by the Secretary or, if not so
eligible, is a Loan for which interest either is billed
quarterly to Borrower or deferred until commencement of the
repayment period, in which case such accrued interest is
subject to capitalization to the full extent permitted by the
applicable Guarantor;
(vii) is supported by the following documentation:
(a) for each Loan:
1. loan application, and any supplement
thereto,
2. original promissory note and any addendum
thereto or a certified copy thereof if more
than one loan is represented by a single
promissory note and all loans so represented
are not being sold at the same time,
3. evidence of guarantee,
4. any other document and/or record which
Funding may be required to retain pursuant
to Regulations; and
(b) for each Loan only if applicable:
1. payment history (or similar document)
including (i) an indication of the Principal
Balance and the date through which interest
has been paid, each as of the Cutoff Date
and (ii) an accounting of the allocation of
all payments by Borrower or on Borrower's
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behalf to principal and interest on the
Loan,
2. documentation which supports periods of
current or past deferment or past
forbearance,
3. a collection history, if the Loan was ever
in a delinquent status, including detailed
summaries of contacts and including the
addresses or telephone numbers used in
contacting or attempting to contact Borrower
and any endorser and, if required by the
Guarantor, copies of all letters and other
correspondence relating to due diligence
processing,
4. evidence of all requests for skip-tracing
assistance and current address of Borrower,
if located,
5. evidence of requests for pre-claims
assistance, and evidence that the Borrower's
school(s) have been notified,
6. a record of any event resulting in a change
to or confirmation of any data in the Loan
file.
(I) "Initial Payment" means the dollar amount specified in the
applicable Purchase Agreement.
(J) "Loan" means the Note or Notes offered for sale pursuant to the
Purchase Agreement and related documentation together with any
guaranties and other rights relating thereto including, without
limitation, Interest Subsidy Payments and Special Allowance Payments.
(K) "Loan Transmittal Summary Forms" means the forms provided to ▇▇▇▇▇▇
Mae by Funding and completed by ▇▇▇▇▇▇ ▇▇▇ which list, by Borrower, the
Loans subject to the ▇▇▇▇ of Sale and the outstanding Principal Balance
and accrued interest thereof as of the Cutoff Date.
(L) "Note" means the promissory note of the Borrower and any amendment
thereto evidencing the Borrower's obligation with regard to a student
loan guaranteed under the Higher Education Act.
(M) "PLUS Loan" means a Loan which was made pursuant to the PLUS
Program established under Section 428B of the Higher Education Act (or
predecessor provisions).
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(N) "Principal Balance" means the outstanding principal amount of the
Loan, plus interest expected to be capitalized (if any), less amounts
which may not be insured (such as late charges).
(O) "Purchase Agreement" means a Purchase Agreement (including any
attachments thereto), substantially in the form of Attachment A hereto,
of which these Master Terms form a part by reference.
(P) "Purchase Price" means the sum of the Initial Payment and Deferred
Payment.
(Q) "Sale Agreement" means the Sale Agreement Master Securitization
Terms Number 1000 among SLM Funding Corporation as seller, Chase
Manhattan Bank USA, National Association as Interim Eligible Lender
Trustee and Eligible Lender Trustee.
(R) "Secretary" means the United States Secretary of Education or any
successor.
(S) "SLS Loan" means a Loan which was made pursuant to the Supplemental
Loans for Students Program established under Section 428A of the Higher
Education Act (or predecessor provisions), including Loans referred to
as ALAS Loans or Student PLUS Loans.
(T) "▇▇▇▇▇▇▇▇ Loans" mean Subsidized ▇▇▇▇▇▇▇▇ Loans and Unsubsidized
▇▇▇▇▇▇▇▇ Loans.
(U) "Subsidized ▇▇▇▇▇▇▇▇ Loan" means a Loan for which the interest rate
is governed by Section 427A(a) or 427A(d) of the Higher Education Act.
(V) "Unsubsidized ▇▇▇▇▇▇▇▇ Loan" means a Loan made pursuant to Section
428H of the Higher Education Act.
SECTION 3. SALE/PURCHASE
(A) Consummation of Sale and Purchase
The sale and purchase of Eligible Loans pursuant to a Purchase
Agreement shall be consummated upon Funding's receipt from ▇▇▇▇▇▇ Mae
of the ▇▇▇▇ of Sale and the payment by Funding to ▇▇▇▇▇▇ Mae of the
Initial Payment, and when consummated such sale and purchase shall be
effective as of the date of the ▇▇▇▇ of Sale. ▇▇▇▇▇▇ Mae and Funding
shall use their best efforts to perform promptly their respective
obligations pursuant to such Purchase Agreement.
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(B) Settlement of the Initial Payment
Funding on the date of the ▇▇▇▇ of Sale shall pay ▇▇▇▇▇▇ Mae
the Initial Payment by wire transfer of immediately available funds to
the account specified by ▇▇▇▇▇▇ ▇▇▇.
(C) Interest Subsidy and Special Allowance Payments
On the date of the ▇▇▇▇ of Sale, ▇▇▇▇▇▇ ▇▇▇ shall be entitled
to all Interest Subsidy Payments and Special Allowance Payments on the
Loans subject to each ▇▇▇▇ of Sale accruing up to but not including the
date of the ▇▇▇▇ of Sale. The Interim Eligible Lender Trustee on behalf
of Funding shall be entitled to all Special Allowance Payments and
Interest Subsidy Payments accruing from the date of the ▇▇▇▇ of Sale.
(D) Special Programs
In consideration of the sale of the Eligible Loans under these
Master Terms and each Purchase Agreement, Funding agrees to cause the
Servicer to offer borrowers of Trust Student Loans all special
programs, whether or not in existence as of the date of any Purchase
Agreement, generally offered to the obligors of comparable loans owned
by ▇▇▇▇▇▇ ▇▇▇ subject to terms and conditions of Section 3.12 of the
Servicing Agreement.
(E) Deferred Payment
Funding shall pay the Deferred Payment to ▇▇▇▇▇▇ Mae when and
as the same is received by Funding. If the Trust Student Loans are
purchased by Funding pursuant to Section 6.1 of the Administration
Agreement, Funding shall pay to ▇▇▇▇▇▇ ▇▇▇ as part of the Deferred
Payment 66 2/3% of the present value of the excess of the projected
future yield on the Trust Student Loans after the date of such purchase
over the projected cost to Funding of carrying the Trust Student Loans
as reasonably estimated by Funding assuming (1) that interest rates
applicable to the Trust Student Loans in effect on the date of such
purchase remain in effect, (2) that the cost to Funding of carrying the
Trust Student Loans is equal to the blended rate on the Notes and
Certificates on the date of such purchase, (3) that the servicing costs
and loss experience applicable to the Trust Student Loans during the
one year period preceding such purchase continue during the remaining
life of the Trust Student Loans and (4) a discount rate equal to the
blended rate on the Notes and Certificates on the date of such
purchase. If the Trust Student Loans are sold pursuant to the auction
provision in Section 4.4 of the Indenture,
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Funding shall pay to ▇▇▇▇▇▇ Mae as part of the Deferred Payment 66 2/3%
of the amount, if any, by which the sale price exceeds the Minimum
Purchase Amount and any costs of terminating the Trust. Funding shall
also be obligated to pay ▇▇▇▇▇▇ ▇▇▇ as part of the Deferred Payment, in
the event that the provisions of Section 2.8C(F) of the Administration
Agreement are operative, upon payment in full of the Notes and
Certificates to the extent of amounts then distributable by the Trust
to Funding, 66 2/3% of the aggregate amount that would have been
distributed to Funding pursuant to Section 2.8C(G) of the
Administration Agreement (exclusive of the amount of any such
distribution attributable to the reduction from time to time of the
Specified Reserve Account Balance) but for the operation of Section
2.8C(F) of the Administration Agreement.
SECTION 4. CONDITIONS PRECEDENT TO PURCHASE
(A) Activities Prior to the Purchase Date
▇▇▇▇▇▇ Mae shall provide any assistance requested by Funding
in determining that all required documentation on the Loans is present
and correct.
(B) Continued Servicing
Following the execution of each Purchase Agreement, ▇▇▇▇▇▇ ▇▇▇
shall service, or cause to be serviced, all Loans subject to such
Purchase Agreement as required under the Higher Education Act until the
date of the ▇▇▇▇ of Sale.
(C) ▇▇▇▇ of Sale/Loan Transmittal Summary Form
▇▇▇▇▇▇ Mae shall deliver to Funding:
(i) a ▇▇▇▇ of Sale executed by an authorized officer of ▇▇▇▇▇▇
Mae, covering Loans offered by ▇▇▇▇▇▇ ▇▇▇ and accepted by
Funding as set forth thereon, selling, assigning and conveying
to the Interim Eligible Lender Trustee on behalf of Funding
and its assignees all right, title and interest of ▇▇▇▇▇▇ Mae,
including the insurance interest of ▇▇▇▇▇▇ ▇▇▇, in each of the
Loans, and stating that the representations and warranties
made by ▇▇▇▇▇▇ Mae in Section 5 of these Master Terms are true
and correct on and as of the date of the ▇▇▇▇ of Sale; and
(ii) the Loan Transmittal Summary Form, attached to the ▇▇▇▇
of Sale, identifying each of the Eligible Loans which is the
subject of the ▇▇▇▇ of Sale and
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setting forth the unpaid Principal Balance of each such Loan.
(D) Endorsement
▇▇▇▇▇▇ Mae shall provide a blanket endorsement transferring
the entire interest of ▇▇▇▇▇▇ ▇▇▇ in the Loans to the Interim Eligible
Lender Trustee on behalf of Funding with the form of endorsement
provided for in the Purchase Agreement.
At the direction of and in such form as Funding may designate,
▇▇▇▇▇▇ Mae also agrees to individually endorse any Eligible Loan as
Funding may request from time to time.
(E) Officer's Certificate
▇▇▇▇▇▇ ▇▇▇ shall furnish to Funding, with each ▇▇▇▇ of Sale
provided in connection with each purchase of Loans pursuant to these
Master Terms, an Officer's Certificate, dated as of the date of such
▇▇▇▇ of Sale, in substantially the form of Attachment C.
(F) Loan Transfer Statement
Upon Funding's request, ▇▇▇▇▇▇ Mae shall deliver to Funding
one (1) or more Loan Transfer Statements (Department of Education Form
OE 1074 or its equivalent) provided by Funding, executed by ▇▇▇▇▇▇ ▇▇▇
and dated the date of the ▇▇▇▇ of Sale. ▇▇▇▇▇▇ ▇▇▇ agrees that Funding
and the Interim Eligible Lender Trustee may use the ▇▇▇▇ of Sale,
including the Loan Transmittal Summary Form attached to the ▇▇▇▇ of
Sale, in lieu of OE Form 1074, as official notification to the
Guarantor of the assignment by ▇▇▇▇▇▇ Mae to the Interim Eligible
Lender Trustee on behalf of Funding of the Loans listed on the ▇▇▇▇ of
Sale.
(G) Power of Attorney
▇▇▇▇▇▇ Mae hereby grants to Funding and the Interim Eligible
Lender Trustee for the benefit of Funding an irrevocable power of
attorney, which power of attorney is coupled with an interest, to
individually endorse or cause to be individually endorsed in the name
of ▇▇▇▇▇▇ ▇▇▇ any Eligible Loan to evidence the transfer of such
Eligible Loan to Funding and the Interim Eligible Lender Trustee for
the benefit of Funding and to cause to be transferred physical
possession of any Note from ▇▇▇▇▇▇ Mae or the Servicer to Funding or
the Interim Eligible Lender Trustee or any custodian on their behalf.
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SECTION 5. REPRESENTATIONS AND WARRANTIES OF ▇▇▇▇▇▇ ▇▇▇ AND
INTERIM ELIGIBLE LENDER TRUSTEE
(A) General
▇▇▇▇▇▇ Mae represents and warrants to Funding that with respect to a
portfolio of Loans, as of the date of each Purchase Agreement and ▇▇▇▇ of Sale:
(i) ▇▇▇▇▇▇ Mae is an eligible lender or other qualified holder
of loans originated pursuant to the Federal Family Education
Loan Program established under the Higher Education Act;
(ii) ▇▇▇▇▇▇ ▇▇▇ is duly organized and existing under the laws
of the applicable jurisdiction;
(iii) ▇▇▇▇▇▇ Mae has all requisite power and authority to
enter into and to perform the terms of the Purchase Agreement;
and
(iv) ▇▇▇▇▇▇ ▇▇▇ will not, with respect to any Loan purchased
under Purchase Agreements executed pursuant to these Master
Terms, agree to release any Guarantor from any of its
contractual obligations as an insurer of such Loan or agree
otherwise to alter, amend or renegotiate any material term or
condition under which such Loan is insured, except as required
by law or rules and regulations issued pursuant to law,
without the express prior written consent of Funding.
(B) Particular
▇▇▇▇▇▇ Mae represents and warrants to Funding as to the Loans
purchased by Funding under each Purchase Agreement and each ▇▇▇▇ of
Sale executed pursuant these Master Terms that:
(i) ▇▇▇▇▇▇ Mae has good title to, and is the sole owner of,
the Loans, free and clear of all security interests, liens,
charges, claims, offsets, defenses, counterclaims or
encumbrances of any nature and no right of rescission,
offsets, defenses or counterclaims have been asserted or
threatened with respect to the Loans;
(ii) The Loans are Eligible Loans and the description of the
Loans set forth in the Purchase Agreement is true and correct;
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(iii) ▇▇▇▇▇▇ ▇▇▇ is authorized to sell, assign, transfer and
repurchase the Loans; and the sale, assignment and transfer of
such Loans is or, in the case of a Loan repurchase by ▇▇▇▇▇▇
Mae, will be made pursuant to and consistent with the laws and
regulations under which ▇▇▇▇▇▇ ▇▇▇ operates, and will not
violate any decree, judgment or order of any court or agency,
or conflict with or result in a breach of any of the terms,
conditions or provisions of any agreement or instrument to
which ▇▇▇▇▇▇ Mae is a party or by which ▇▇▇▇▇▇ ▇▇▇ or its
property is bound, or constitute a default (or an event which
could constitute a default with the passage of time or notice
or both) thereunder;
(iv) The Loans are each in full force and effect in accordance
with their terms and are legal, valid and binding obligations
of the respective Borrowers thereunder subject to no defenses
(except the defense of infancy);
(v) Each Loan has been duly made and serviced in accordance
with the provisions of the Federal Family Education Loan
Program established under the Higher Education Act, and has
been duly insured by a Guarantor; such guarantee is in full
force and effect and is freely transferable to the Interim
Eligible Lender Trustee on behalf of Funding as an incident to
the purchase of each Loan; and all premiums due and payable to
such Guarantor shall have been paid in full as of the date of
the ▇▇▇▇ of Sale;
(vi) Any payments on the Loans received by ▇▇▇▇▇▇ ▇▇▇ which
have been allocated to reduction of principal and interest on
such Loans have been allocated on a simple interest basis; the
information with respect to the Loans as of the Cutoff Date as
stated on the Loan Transmittal Summary Form is true and
correct;
(vii) Due diligence and reasonable care have been exercised in
the making, administering, servicing and collecting the Loans
and, with respect to any Loan for which repayment terms have
been established, all disclosures of information required to
be made pursuant to the Higher Education Act have been made;
(viii) All origination fees authorized to be collected
pursuant to Section 438 of the Higher Education Act have been
paid to the Secretary;
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(ix) Each Loan has been duly made and serviced in accordance
with the provisions of all applicable federal and state laws;
(x) No Loan is more than ninety (90) days delinquent as of the
Cutoff Date and no default, breach, violation or event
permitting acceleration under the terms of any Loan has
arisen; and neither ▇▇▇▇▇▇ Mae nor any predecessor holder of
any Loan has waived any of the foregoing other than as
permitted by the Basic Documents;
(xi) It is the intention of ▇▇▇▇▇▇ ▇▇▇, the Interim Eligible
Lender Trustee and Funding, and ▇▇▇▇▇▇ Mae hereby warrants
that, the transfer and assignment herein contemplated
constitute a valid sale of the Loans from ▇▇▇▇▇▇ ▇▇▇ to the
Interim Eligible Lender Trustee on behalf of Funding and that
the beneficial interest in and title to such Loans not be part
of ▇▇▇▇▇▇ Mae's estate in the event of the bankruptcy of
▇▇▇▇▇▇ ▇▇▇ or the appointment of a receiver with respect to
▇▇▇▇▇▇ Mae;
(xii) There is only one original executed copy of the
promissory note evidencing each Loan; and
(xiii) No Borrower of any Loan as of the Cutoff Date is noted
in the related Loan File as being currently involved in a
bankruptcy proceeding.
(C) The Interim Eligible Lender Trustee represents and warrants that as
of the date of each Purchase Agreement and each ▇▇▇▇ of Sale:
(i) The Interim Eligible Lender Trustee is a national banking
association duly organized and validly existing in good standing under
the laws of the United States and having an office located within the
state of Delaware. It has all requisite corporate power and authority
to execute, deliver and perform its obligations under this Purchase
Agreement;
(ii) The Interim Eligible Lender Trustee has taken all
corporate action necessary to authorize the execution and delivery by
it of the Purchase Agreement, and the Purchase Agreement will be
executed and delivered by one of its officers who is duly authorized to
execute and deliver the Purchase Agreement on its behalf;
(iii) Neither the execution nor the delivery by it of the
Purchase Agreement, nor the consummation by it of the transactions
contemplated hereby nor compliance by it with
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any of the terms or provisions hereof will contravene any Federal or
Delaware state law, governmental rule or regulation governing the
banking or trust powers of the Interim Eligible Lender Trustee or any
judgment or order binding on it, or constitute any default under its
charter documents or by-laws or any indenture, mortgage, contract,
agreement or instrument to which it is a party or by which any of its
properties may be bound; and
(iv) The Interim Eligible Lender Trustee is an "eligible
lender" as such term is defined in Section 435(d) of the Higher
Education Act, for purposes of holding legal title to the Trust Student
Loans as contemplated by the Purchase Agreement and the other Basic
Documents, it has a lender identification number with respect to the
Trust Student Loans from the Department and has in effect a Guarantee
Agreement with each of the Guarantors with respect to the Trust Student
Loans.
SECTION 6. PURCHASE OF TRUST STUDENT LOANS; REIMBURSEMENT
Each party to this Agreement shall give notice to the other parties
promptly, in writing, upon the discovery of any breach of ▇▇▇▇▇▇ Mae's
representations and warranties made pursuant to Section 5 hereof which has a
materially adverse effect on the interest of Funding in any Trust Student Loan.
In the event of such a material breach which is not curable by reinstatement of
the Guarantor's guarantee of such Trust Student Loan, ▇▇▇▇▇▇ Mae shall
repurchase any affected Trust Student Loan not later than 120 days following the
earlier of the date of discovery of such material breach and the date of receipt
of the Guarantor reject transmittal form with respect to such Trust Student
Loan. In the event of such a material breach which is curable by reinstatement
of the Guarantor's guarantee of such Trust Student Loan, unless the material
breach shall have been cured within 360 days following the earlier of the date
of discovery of such material breach and the date of receipt of the Guarantor
reject transmittal form with respect to such Trust Student Loan, ▇▇▇▇▇▇ ▇▇▇
shall purchase such Trust Student Loan not later than the sixtieth day following
the end of such 360-day period. ▇▇▇▇▇▇ Mae shall also remit as provided in
Section 2.6 of the Administration Agreement on the date of purchase of any Trust
Student Loan pursuant to this Section 6 an amount equal to all nonguaranteed
interest amounts and forfeited Interest Subsidy Payments and Special Allowance
Payments with respect to such Trust Student Loan. In consideration of the
purchase of any such Trust Student Loan pursuant to this Section 6, ▇▇▇▇▇▇ ▇▇▇
shall remit the Purchase Amount in the manner specified in Section 2.6 of the
Administration Agreement.
In addition, if any breach of Section 5 hereof by ▇▇▇▇▇▇ Mae does not
trigger such purchase obligation but does result in
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the refusal by a Guarantor to guarantee all or a portion of the accrued interest
(or any obligation of Funding to repay such interest to a Guarantor), or the
loss (including any obligation of Funding to repay the Department) of Interest
Subsidy Payments and Special Allowance Payments, with respect to any Trust
Student Loan affected by such breach, then ▇▇▇▇▇▇ ▇▇▇ shall reimburse Funding by
remitting an amount equal to the sum of all such nonguaranteed interest amounts
and such forfeited Interest Subsidy Payments or Special Allowance Payments in
the manner specified in Section 2.6 of the Administration Agreement not later
than (i) the last day of the next Collection Period ending not less than 60 days
from the date of the Guarantor's refusal to guarantee all or a portion of
accrued interest or loss of Interest Subsidy Payments or Special Allowance
Payments, or (ii) in the case where ▇▇▇▇▇▇ Mae reasonably believes such losses
are likely to be collected, not later than the last day of the next Collection
Period ending not less than 360 days from the date of the Guarantor's refusal to
guarantee all or a portion of accrued interest or loss of Interest Subsidy
Payments or Special Allowance Payments. At the time such payment is made, ▇▇▇▇▇▇
Mae shall not be required to reimburse Funding for interest that is then
capitalized, however, such amounts shall be reimbursed if the borrower
subsequently defaults and such capitalized interest is not paid by the
Guarantor.
Anything in this Section 6 to the contrary notwithstanding, if as of
the last Business Day of any month the aggregate outstanding principal amount of
Trust Student Loans with respect to which claims have been filed with and
rejected by a Guarantor or with respect to which the Servicer determines that
claims cannot be filed pursuant to the Higher Education Act as a result of a
breach by ▇▇▇▇▇▇ ▇▇▇ or the Servicer, exceeds 1% of the Pool Balance, ▇▇▇▇▇▇ Mae
(and the Servicer as provided in the Servicing Agreement) shall purchase, within
30 days of a written request of the Eligible Lender Trustee or the Indenture
Trustee, such affected Trust Student Loans in an aggregate principal amount such
that after such purchase the aggregate principal amount of such affected Trust
student Loans is less than 1% of the Pool Balance. The Trust Student Loans to be
purchased by ▇▇▇▇▇▇ ▇▇▇ and the Servicer pursuant to the preceding sentence
shall be based on the date of claim rejection (or the date of notice referred to
in the first sentence of this Section 6) with Trust Student Loans with the
earliest such date to be purchased first.
In lieu of repurchasing Trust Student Loans pursuant to this Section 6,
▇▇▇▇▇▇ Mae may, at its option, substitute Eligible Loans or arrange for the
substitution of Eligible Loans which are substantially similar on an aggregate
basis as of the date of substitution to the Trust Student Loans for which they
are being substituted with respect to the following characteristics:
13
(1) status (i.e., in-school, grace, deferment,
forbearance or repayment),
(2) program type (i.e., Unsubsidized ▇▇▇▇▇▇▇▇, Subsidized
▇▇▇▇▇▇▇▇, PLUS or SLS),
(3) school type,
(4) total return,
(5) principal balance, and
(6) remaining term to maturity.
In addition, each substituted Eligible Loan will comply, as of the date
of substitution, with all of the representations and warranties made hereunder.
In choosing Eligible Loans to be substituted pursuant to this Section 6, ▇▇▇▇▇▇
▇▇▇ shall make a reasonable determination that the Eligible Loans to be
substituted will not have a material adverse effect on the Noteholders and the
Certificateholders.
In the event that ▇▇▇▇▇▇ Mae elects to substitute Eligible Loans
pursuant to this Section 6, ▇▇▇▇▇▇ ▇▇▇ will remit to the Administrator the
amount of any shortfall between the Purchase Amount of the substituted Eligible
Loans and the Purchase Amount of the Trust Student Loans for which they are
being substituted. ▇▇▇▇▇▇ Mae shall also remit to the Administrator an amount
equal to all nonguaranteed interest amounts and forfeited Interest Subsidy
Payments and Special Allowance Payments with respect to the Trust Student Loans
in the manner provided in Section 2.6 of the Administration Agreement. The sole
remedy of Funding, the Eligible Lender Trustee, the Certificateholders and the
Noteholders with respect to a breach by ▇▇▇▇▇▇ ▇▇▇ pursuant to Section 5 hereof
shall be to require ▇▇▇▇▇▇ Mae to purchase Trust Student Loans, to reimburse
Funding as provided above or to substitute Student Loans pursuant to this
Section. The Eligible Lender Trustee shall have no duty to conduct any
affirmative investigation as to the occurrence of any condition requiring the
purchase of any Trust Student Loan or the reimbursement for any interest penalty
pursuant to this Section 6.
SECTION 7. OBLIGATION TO REMIT SUBSEQUENT PAYMENTS
AND FORWARD COMMUNICATIONS
(A) Any payment received by ▇▇▇▇▇▇ ▇▇▇ with respect to amounts accrued
after the Date of the ▇▇▇▇ of Sale for any Loan sold to Funding, which
payment is not reflected in the Loan Transmittal Summary Form, shall be
received by ▇▇▇▇▇▇ ▇▇▇ in trust for the account of Funding and ▇▇▇▇▇▇
Mae hereby disclaims any title to or interest in any such
14
amounts. Within two (2) business days following the date of receipt,
▇▇▇▇▇▇ ▇▇▇ shall remit to Funding an amount equal to any such payments
on a list provided by Funding identifying the Loans with respect to
which such payments were made, the amount of each such payment and the
date each such payment was received.
(B) Any written communication received at any time by ▇▇▇▇▇▇ Mae with
respect to any Loan subject to this Purchase Agreement shall be
transmitted by ▇▇▇▇▇▇ ▇▇▇ to Servicer within two (2) business days of
receipt. Such communications shall include, but not be limited to,
letters, notices of death or disability, notices of bankruptcy, forms
requesting deferment of repayment or loan cancellation, and like
documents.
SECTION 8. CONTINUING OBLIGATION OF ▇▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇ Mae shall provide all reasonable assistance necessary for
Funding to resolve account problems raised by any Borrower, the Guarantor or the
Secretary provided such account problems are attributable to or are alleged to
be attributable to (a) an event occurring during the period ▇▇▇▇▇▇ ▇▇▇ owned the
Loan, or (b) a payment made or alleged to have been made to ▇▇▇▇▇▇ Mae. Further,
▇▇▇▇▇▇ ▇▇▇ agrees to execute any financing statements at the request of Funding
in order to reflect Funding's interest in the Loans.
SECTION 9. LIABILITY OF ▇▇▇▇▇▇ MAE; INDEMNITIES
▇▇▇▇▇▇ ▇▇▇ shall be liable in accordance herewith only to the extent of
the obligations specifically undertaken by ▇▇▇▇▇▇ Mae under this Purchase
Agreement.
(i) ▇▇▇▇▇▇ ▇▇▇ shall indemnify, defend and hold harmless Funding and
the Interim Eligible Lender Trustee in its individual capacity 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
Interim Eligible Lender Trustee), including any sales, gross receipts,
general corporation, tangible personal property, privilege or license
taxes (but, in the case of Funding, not including any taxes asserted
with respect to, and as of the date of, the sale of the Loans to the
Interim Eligible Lender Trustee on behalf of Funding, or asserted with
respect to ownership of the Trust Student Loans) and costs and expenses
in defending against the same.
15
(ii) ▇▇▇▇▇▇ ▇▇▇ shall indemnify, defend and hold harmless Funding and
the Interim Eligible Lender Trustee in its individual capacity, and the
officers, directors, employees and agents of Funding, and the Interim
Eligible Lender Trustee from and against any and all costs, expenses,
losses, claims, damages and liabilities arising out of, or imposed upon
such Person through, ▇▇▇▇▇▇ Mae's willful misfeasance, bad faith or
gross negligence in the performance of its duties under the Purchase
Agreement, or by reason of reckless disregard of its obligations and
duties under the Purchase Agreement.
(iii) ▇▇▇▇▇▇ ▇▇▇ shall be liable as primary obligor for, and shall
indemnify, defend and hold harmless the Interim Eligible Lender Trustee
in its individual capacity 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 Purchase Agreement, the other Basic Documents, the
acceptance or performance of the trusts and duties set forth herein and
in the Sale Agreement or the action or the inaction of the Interim
Eligible Lender Trustee hereunder, except to the extent that such cost,
expense, loss, claim, damage, obligation or liability: (a) shall be due
to the willful misfeasance, bad faith or negligence (except for errors
in judgment) of the Interim Eligible Lender Trustee, (b) shall arise
from any breach by the Interim Eligible Lender Trustee of its covenants
made under any of the Basic Documents; or (c) shall arise from the
breach by the Interim Eligible Lender Trustee of any of its
representations or warranties made in its individual capacity set forth
in these Master Terms or any Purchase Agreement. In the event of any
claim, action or proceeding for which indemnity will be sought pursuant
to this paragraph, the Interim Eligible Lender Trustee's choice of
legal counsel shall be subject to the approval of ▇▇▇▇▇▇ Mae, which
approval shall not be unreasonably withheld.
Indemnification under this Section shall survive the resignation or
removal of the Interim Eligible Lender Trustee and the termination of these
Master Terms, and shall include reasonable fees and expenses of counsel and
expenses of litigation. If ▇▇▇▇▇▇ ▇▇▇ 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 ▇▇▇▇▇▇ Mae, without interest.
16
SECTION 10. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE
OBLIGATIONS OF ▇▇▇▇▇▇ ▇▇▇
Any Person (a) into which ▇▇▇▇▇▇ Mae may be merged or consolidated, (b)
which may result from any merger or consolidation to which ▇▇▇▇▇▇ ▇▇▇ shall be a
party or (c) which may succeed to the properties and assets of ▇▇▇▇▇▇ Mae
substantially as a whole, shall be the successor to ▇▇▇▇▇▇ ▇▇▇ without the
execution or filing of any document or any further act by any of the parties to
this Purchase Agreement; provided, however, that ▇▇▇▇▇▇ Mae hereby covenants
that it will not consummate any of the foregoing transactions except upon
satisfaction of the following: (i) the surviving Person, if other than ▇▇▇▇▇▇
▇▇▇, executes an agreement of assumption to perform every obligation of ▇▇▇▇▇▇
Mae under the Purchase Agreement, (ii) immediately after giving effect to such
transaction, no representation or warranty made pursuant to Section 5 shall have
been breached, (iii) the surviving Person, if other than ▇▇▇▇▇▇ ▇▇▇, shall have
delivered to the Interim Eligible Lender 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 Purchase Agreement relating
to such transaction have been complied with, and that the Rating Agency
Condition shall have been satisfied with respect to such transaction (iv) if
▇▇▇▇▇▇ Mae is not the surviving entity, ▇▇▇▇▇▇ ▇▇▇ shall have delivered to the
Interim Eligible Lender Trustee an Opinion of Counsel either (A) stating that,
in the opinion of such counsel, all financing statements and continuation
statements and amendments thereto have been executed and filed that are
necessary fully to preserve and protect the interest of Funding and the Interim
Eligible Lender Trustee in the 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 11. LIMITATION ON LIABILITY OF ▇▇▇▇▇▇ MAE AND OTHERS
▇▇▇▇▇▇ ▇▇▇ and any director or officer or employee or agent thereof 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 that such reliance shall not limit in any way ▇▇▇▇▇▇
Mae's obligations under Section 6.) ▇▇▇▇▇▇ ▇▇▇ shall not be under any obligation
to appear in, prosecute or defend any legal action that shall not be incidental
to its obligations under these Master Terms or any Purchase Agreement, and that
in its opinion may involve it in any expense or liability. Except as provided
herein, the repurchase (or substitution) and reimbursement obligations of ▇▇▇▇▇▇
Mae will constitute the sole remedy available to Funding for uncured breaches;
provided,
17
however, that the information with respect to the Loans listed on the ▇▇▇▇ of
Sale may be adjusted in the ordinary course of business subsequent to the date
of the ▇▇▇▇ of Sale and to the extent that the aggregate Principal Balance of
the Loans listed on the ▇▇▇▇ of Sale is less than the aggregate Principal
Balance stated on the ▇▇▇▇ of Sale, ▇▇▇▇▇▇ ▇▇▇ shall remit such amount to the
Interim Eligible Lender Trustee on behalf of Funding. Such reconciliation
payment shall be made from time to time but no less frequently than
semi-annually.
SECTION 12. LIMITATION OF LIABILITY OF INTERIM ELIGIBLE LENDER
TRUSTEE
Notwithstanding anything contained herein to the contrary, these Master
Terms and any Purchase Agreement have been signed by Chase Manhattan Bank USA,
National Association not in its individual capacity but solely in its capacity
as Interim Eligible Lender Trustee for Funding and in no event shall Chase
Manhattan Bank USA, National Association in its individual capacity have any
liability for the representations, warranties, covenants, agreements or other
obligations of Funding, under these Master Terms or any Purchase Agreement 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 Funding.
SECTION 13. EXPENSES
Except as otherwise provided herein, each party to these Master Terms
or any Purchase Agreement shall pay its own expense incurred in connection with
the preparation, execution and delivery of these Master Terms and any Purchase
Agreement and the transactions contemplated herein or therein.
SECTION 14. SURVIVAL OF COVENANTS/SUPERSESSION
All covenants, agreements, representations and warranties made herein
and in or pursuant to any Purchase Agreements executed pursuant to these Master
Terms shall survive the consummation of the purchase of the Loans provided for
in each Purchase Agreement. All covenants, agreements, representations and
warranties made or furnished pursuant hereto by or on behalf of ▇▇▇▇▇▇ ▇▇▇ shall
bind and inure to the benefit of any successors or assigns of Funding and shall
survive with respect to each Loan. Each Purchase Agreement supersedes all
previous agreements and understandings between Funding and ▇▇▇▇▇▇ Mae with
respect to the subject matter thereof. These Master Terms and any Purchase
Agreement may be changed, modified or discharged, and any rights or obligations
hereunder may be waived, only by a written instrument signed by a duly
authorized officer of the party against whom enforcement of any such waiver,
change, modification or discharge is sought. The waiver
18
by Funding of any covenant, agreement, representation or warranty required to be
made or furnished by ▇▇▇▇▇▇ ▇▇▇ or the waiver by Funding of any provision herein
contained or contained in any Purchase Agreement shall not be deemed to be a
waiver of any breach of any other covenant, agreement, representation, warranty
or provision herein contained, nor shall any waiver or any custom or practice
which may evolve between the parties in the administration of the terms hereof
or of any Purchase Agreement, be construed to lessen the right of Funding to
insist upon the performance by ▇▇▇▇▇▇ Mae in strict accordance with said terms.
SECTION 15. COMMUNICATION AND NOTICE REQUIREMENTS
All communications, notices and approvals provided for hereunder shall
be in writing and mailed or delivered to ▇▇▇▇▇▇ ▇▇▇ or Funding, as the case may
be, addressed as set forth in the Purchase Agreement or at such other address as
either party may hereafter designate by notice to the other party. Notice given
in any such communication, mailed to ▇▇▇▇▇▇ Mae or Funding by appropriately
addressed registered mail, shall be deemed to have been given on the day
following the date of such mailing.
SECTION 16. FORM OF INSTRUMENTS
All instruments and documents delivered in connection with these Master
Terms and any Purchase Agreement, and all proceedings to be taken in connection
with these Master Terms and any Purchase Agreement and the transactions
contemplated herein and therein, shall be in a form as set forth in the
attachments hereto, and Funding shall have received copies of such documents as
it or its counsel shall reasonably request in connection therewith. Any
instrument or document which is substantially in the same form as an Attachment
hereto or a recital herein will be deemed to be satisfactory as to form.
SECTION 17. AMENDMENT
These Master Terms and any Purchase Agreement may be amended by the
parties thereto without the consent of the related Noteholders or
Certificateholders for the purpose of adding any provisions to or changing in
any manner or eliminating any of the provisions of such Master Terms and
Purchase Agreements or of modifying in any manner the rights of such Noteholders
or Certificateholders; provided that such action will not, in the opinion of
counsel satisfactory to the related Indenture Trustee and Eligible Lender
Trustees, materially and adversely affect the interest of any such Noteholder or
Certificateholder.
In addition, these Master Terms and any Purchase Agreement may also be
amended from time to time by ▇▇▇▇▇▇ ▇▇▇, the Interim Eligible Lender Trustee and
Funding, with the consent of the
19
Noteholders of Notes evidencing a majority of the Outstanding Amount of the
Notes and the consent of the Certificateholders of Certificates evidencing a
majority of the Certificate Balance, for the purpose of adding any provisions to
or changing in any manner or eliminating any of the provisions of these Master
Terms or any Purchase Agreements or of modifying in any manner the rights of the
Noteholders or the Certificateholders; provided, however, that no such amendment
shall (a) increase or reduce in any manner the amount of, or accelerate or delay
the time of, collections of payments with respect to Loans or distributions that
shall be required to be made for the benefit of the Noteholders or the
Certificateholders or (b) reduce the aforesaid percentage of the Outstanding
Amount of the Notes and the Certificate Balance of Certificates, the Noteholders
or the Certificateholders of which are required to consent to any such
amendment, without the consent of all outstanding Noteholders and
Certificateholders.
Promptly after the execution of any such amendment or consent (or, in
the case of the Rating Agencies, five Business Days prior thereto), the Interim
Eligible Lender Trustee shall furnish written notification of the substance of
such amendment or consent to the Indenture Trustee, each Certificateholder, and
each of the Rating Agencies.
It shall not be necessary for the consent of Certificateholders or
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 these Master Terms, the
Interim Eligible Lender Trustee shall be entitled to receive and rely upon an
Opinion of Counsel stating that execution of such amendment is authorized or
permitted by this Agreement and the Opinion of Counsel referred to in Section
7.1 I((i) of the Administration Agreement. The Interim Eligible Lender Trustee
may, but shall not be obligated to, enter into any such amendment which affects
the Interim Eligible Lender Trustee's own rights, duties or immunities under
this Agreement or otherwise.
SECTION 18. NONPETITION COVENANTS
Notwithstanding any prior termination of these Master Terms ▇▇▇▇▇▇ Mae
and the Interim Eligible Lender Trustee shall not acquiesce, petition or
otherwise invoke or cause Funding to invoke the process of any court or
government authority for the purpose of commencing or sustaining a case against
Funding under any Federal or state bankruptcy, insolvency or similar law or
appointing a receiver, liquidator, assignees, trustee, custodian, sequestrator
or other similar official of Funding or any substantial part of its property, or
ordering the winding up or liquidation of the affairs of the Funding.
20
SECTION 19. GOVERNING LAW
These Master Terms and any Purchase Agreement shall be government by
and construed in accordance with the laws of the State of New York.
21
STUDENT LOAN MARKETING SLM FUNDING CORPORATION
ASSOCIATION (Purchaser)
(Seller)
By: /s/ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------- --------------------------------
Name: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name:
------------------------------- ------------------------------
Title: V.P., Associate General Title:
Counsel and Corporate Secretary ------------------------------
-------------------------------
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
Not in its individual capacity but
solely as Interim Eligible Lender Trustee
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
---------------------------------
Name:
-------------------------------
Title:
-------------------------------
22
ATTACHMENT A
PURCHASE AGREEMENT
Dated as of ▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇ AGREEMENT NUMBER 1
▇▇▇▇▇▇ Mae hereby offers for sale to Chase Manhattan Bank USA, National
Association as Interim Eligible Lender Trustee for the benefit of SLM
Funding Corporation ("Funding") under the Interim Trust Agreement dated as
of March 1, 1997 between Funding and the Interim Eligible Lender Trustee,
the entire right, title and interest of ▇▇▇▇▇▇ ▇▇▇ in the Loans described in
the ▇▇▇▇ of Sale and Loan Transmittal Summary Form incorporated herein and,
to the extent indicated below, the Interim Eligible Lender Trustee for the
benefit of Funding accepts ▇▇▇▇▇▇ Mae's offer. In order to qualify as
Eligible Loans, no payment of principal or interest shall be more than
ninety (90) days Delinquent as of the Cutoff Date which date shall be March
3, 1997.
TERMS, CONDITIONS AND COVENANTS
In consideration of the Purchase ▇▇▇▇▇, ▇▇▇▇▇▇ Mae hereby sells to the
Interim Eligible Lender Trustee for the benefit of Funding the entire right,
title and interest of ▇▇▇▇▇▇ ▇▇▇ in the Loans accepted for purchase, subject
to all the terms and conditions of the Purchase Agreement Master
Securitization Terms Number 1000 ("Master Terms") and any amendments
thereto, incorporated herein by reference, among ▇▇▇▇▇▇ Mae, Funding, and
the Interim Eligible Lender Trustee. The Initial Payment of the Loans shall
equal $2,039,022,394 (equal to $2,044,057,624 (representing the offering
price of the Securities less underwriters' commissions) less $5,010,230
(representing the Reserve Account Initial Deposit), less $25,000
(representing the initial deposit into the Collection Account).
This document shall constitute a Purchase Agreement as referred to in
the Master Terms and, except as modified herein, each term used herein shall
have the same meaning as in the Master Terms. All references in the Master
Terms to Loans or Eligible Loans shall be deemed to refer to the Loans
governed by this Purchase Agreement. ▇▇▇▇▇▇ ▇▇▇ hereby makes, as of the date
hereof, all the representations and warranties contained in the Master Terms
and makes such representations and warranties with respect to the Loans
governed by this Purchase Agreement.
▇▇▇▇▇▇ Mae authorizes the Interim Eligible Lender Trustee for the
benefit of Funding to use a copy of the ▇▇▇▇ of Sale, including the Loan
Transmittal Summary Form attached to the ▇▇▇▇ of Sale (in lieu of OE Form
1074), as official notification to the Guarantor of assignment to the
Interim Eligible Lender Trustee on behalf of Funding of the Loans on the
date of purchase.
1
The parties hereto intend that the transfer of Loans described in the
▇▇▇▇ of Sale and Loan Transmittal Summary Form be, and be construed as, a
valid sale of such Loans from ▇▇▇▇▇▇ Mae to the Interim Eligible Lender
Trustee for the benefit of Funding. However, in the event that
notwithstanding the intention of the parties, such transfer is deemed to be
a transfer for security, then ▇▇▇▇▇▇ ▇▇▇ hereby grants to the Interim
Eligible Lender Trustee for the benefit of Funding a first priority security
interest in and to all Loans described in the ▇▇▇▇ of Sale and Loan
Transmittal Summary Form to secure a loan in an amount equal to the Purchase
Price of such loans.
STUDENT LOAN MARKETING SLM FUNDING CORPORATION
ASSOCIATION (Purchaser)
(Seller)
By: By:
--------------------------------- --------------------------------
Name: Name:
------------------------------- ------------------------------
Title: Title:
------------------------------- ------------------------------
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
Not in its individual capacity but
solely as Interim Eligible Lender Trustee
By:
---------------------------------
Name:
-------------------------------
Title:
-------------------------------
2
PURCHASE AGREEMENT NUMBER 1
BLANKET ENDORSEMENT DATED MARCH 20, 1997
Student Loan Marketing Association ("▇▇▇▇▇▇ ▇▇▇"), by execution of this
instrument, hereby endorses the attached promissory note which is one (1) of the
promissory notes ("the Notes") described in the ▇▇▇▇ of Sale executed by ▇▇▇▇▇▇
▇▇▇ in favor of Chase Manhattan Bank USA, National Association as the Interim
Eligible Lender Trustee for the benefit of SLM Funding Corporation ("Funding").
This endorsement is in blank, unrestricted form and without recourse except as
provided in Section 6 of the Master Terms referred to in the Purchase Agreement
among ▇▇▇▇▇▇ ▇▇▇, Funding, and the Interim Eligible Lender Trustee which covers
this promissory note.
This endorsement may be effected by attaching either this instrument or
a facsimile hereof to each or any of the Notes.
Notwithstanding the foregoing, ▇▇▇▇▇▇ Mae agrees to individually
endorse each Note in the form provided by Funding as Funding may from time to
time require or if such individual endorsement is required by the Guarantor of
the Note.
THE SALE AND PURCHASE OF THE LOANS SHALL BE SUBJECT TO THE TERMS, CONDITIONS AND
COVENANTS, INCLUDING THE BLANKET ENDORSEMENT, AS SET FORTH IN THE PURCHASE
AGREEMENT. BY EXECUTION HEREOF, ▇▇▇▇▇▇ ▇▇▇ ACKNOWLEDGES THAT ▇▇▇▇▇▇ MAE HAS
READ, UNDERSTANDS AND AGREES TO BE BOUND BY ALL TERMS, CONDITIONS AND COVENANTS
OF THE PURCHASE AGREEMENT. THE SALE AND PURCHASE SHALL BE CONSUMMATED UPON
FUNDING'S PAYMENT TO ▇▇▇▇▇▇ ▇▇▇ OF THE INITIAL PAYMENT (AS DEFINED IN THE MASTER
TERMS) AND, UNLESS OTHERWISE AGREED BY ▇▇▇▇▇▇ MAE AND FUNDING, SHALL BE
EFFECTIVE AS OF THE DATE OF THE ▇▇▇▇ OF SALE.
======================================
SELLER PURCHASER
==================================== ===================================
Student Loan Marketing Association Chase Manhattan Bank USA,
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. National Association,
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ not in its individual capacity
but solely as Interim Eligible
Lender Code: _____________ Lender Trustee for the benefit
of the SLM Funding Corporation
By: under the Interim Trust
-------------------------------- Agreement dated Mar. 1, 1997
(Signature of Authorized
Officer of Seller)
By:
Name: --------------------------------
------------------------------ (Signature of Authorized
Signatory for Purchaser)
Title:
------------------------------ Name:
------------------------------
Title:
------------------------------
Date of Purchase: Mar. 20, 1997
======================================
----------------------------------------------------------------
NOTE: Boxed areas on this form are to be completed by Purchaser.
----------------------------------------------------------------
1
▇▇▇▇ OF SALE DATED MARCH 20, 1997
The undersigned ("▇▇▇▇▇▇ ▇▇▇"), for value received and pursuant to the
terms and conditions of Purchase Agreement Number 1 ("Purchase Agreement") among
SLM Funding Corporation ("Funding"), and Chase Manhattan Bank USA, National
Association as Interim Eligible Lender Trustee for the benefit of Funding under
the Interim Trust Agreement dated as of October 1, 1996 between Funding and the
Interim Eligible Lender Trustee, does hereby sell, assign and convey to the
Interim Eligible Lender Trustee for the benefit of Funding and its assignees all
right, title and interest of ▇▇▇▇▇▇ ▇▇▇, including the insurance interest of
▇▇▇▇▇▇ Mae under the Federal Family Education Loan Program (20 U.S.C. 1071 et
seq.), in the Loans identified herein which the Interim Eligible Lender Trustee
for the benefit of Funding has accepted for purchase. The portfolio accepted for
purchase by the Interim Eligible Lender Trustee for the benefit of Funding and
the effective date of sale and purchase are described below and the individual
Accounts are listed on the Schedule A attached hereto.
▇▇▇▇▇▇ ▇▇▇ hereby makes the representations and warranties set forth in
Section 5 of the Purchase Agreement Master Securitization Terms Number 1000
incorporated by reference in the Purchase Agreement. ▇▇▇▇▇▇ Mae authorizes the
Interim Eligible Lender Trustee on behalf of Funding to use a copy of this
document (in lieu of OE Form 1074) as official notification to the Guarantor(s)
of assignment to the Interim Eligible Lender Trustee for the benefit of Funding
of the Loans on the date of purchase.
LISTING OF LOANS
OFFERED BY ACCEPTED BY ELIGIBLE
SELLER LENDER TRUSTEE
Number of Principal Number of Principal
LOAN TYPE Loans* Balance* Loans Balance
--------------------------------------------------------------------------------
SUBSIDIZED ▇▇▇▇▇▇▇▇
Interim 144,627 419,501,891 144,627 419,501,891
Repayment 333,875 929,107,654 333,875 929,107,654
478,502 1,348,609,545 478,502 1,348,609,545
UNSUBSIDIZED ▇▇▇▇▇▇▇▇
Deferred 51,985 173,255,457 51,985 173,255,457
Repayment 83,169 264,733,902 83,169 264,733,902
135,154 437,989,359 135,154 437,989,359
PLUS/SLS
Deferred 9,957 44,801,024 9,957 44,801,024
Non-Deferred 43,135 172,691,935 43,135 172,691,935
53,092 217,492,959 53,092 217,492,959
CONSOLIDATION 0 0 0 0
TOTAL 666,748 $2,004,091,863 666,748 $2,004,091,863
======= ============== ======= ==============
ADDITIONAL LOAN CRITERIA
Not in claims status, not previously rejected
Not in litigation
Last disbursement is greater than 120 days from cutoff date
Loan is not swap-pending
--------------
*Based upon ▇▇▇▇▇▇ Mae's estimated calculations, which may be adjusted upward
or downward based upon Funding's reconciliation.
Guarantor(s):
American Student Assistance Guarantor
California Student Aid Commission
Connecticut Student Loan Foundation
Educational Credit Management Corporation
Florida Department of Education Office of Student Financial Assistance
Great Lakes Higher Education Corporation
Illinois Student Assistance Commission
Iowa College Student Aid Commission
Kentucky Higher Education Assistance Authority
Louisiana Student Financial Assistance Commission
Michigan Higher Education Assistance Authority
Missouri Coordinating Board for Higher Education
New Jersey Higher Education Assistance Authority
N.Y. State Higher Education Services Corporation
Northstar Guarantee Inc.
Northwest Education Loan Association
Oklahoma State Regents for Higher Education
Oregon State Scholarship Commission
Pennsylvania Higher Education Assistance Agency
Student Loan Guarantee Foundation of Arkansas, Inc.
Tennessee Student Assistance Corporation
Texas Guaranteed Student Loan Corporation
United Student Aid Funds, Inc.
SELLER ======================================
==================================== PURCHASER
Student Loan Marketing Association ===================================
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. Chase Manhattan Bank USA,
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ National Association,
not in its individual capacity
Lender Code: _____________ but solely as Interim Eligible
Lender Trustee for the benefit
By: of SLM Funding Corporation
---------------------------------
(Signature of Authorized By:
Officer of Seller) --------------------------------
(Signature of Authorized
Name: Signatory for Purchaser)
-------------------------------
Name:
Title: ------------------------------
------------------------------- Title:
------------------------------
Date of Purchase: __________________
======================================
================================================================
NOTE: Boxed areas on this form are to be completed by Purchaser.
================================================================
2
OFFICER'S CERTIFICATE
I, ______________________________, of the Student Loan Marketing
Association (the "▇▇▇▇▇▇ ▇▇▇"), hereby certify to SLM Funding Corporation that:
1. The person(s) named below are at the date hereof the duly elected,
qualified and acting officers of ▇▇▇▇▇▇ Mae holding the offices indicated and
the signature following each name is the genuine signature of the person named:
Title Name Signature
----- ---- ---------
_________________________ _______________________ __________________________
_________________________ _______________________ __________________________
_________________________ _______________________ __________________________
_________________________ _______________________ __________________________
2. Any of the above-named person(s) is duly authorized to sign
agreements providing for the sale of student loans to the SLM Funding
Corporation.
WITNESS my hand this day ___ of _________________, 199__.
By:
--------------------------------------------
(Not an officer listed above)
Name:
--------------------------------------------
Title:
-------------------------------------------
1
PURCHASE AGREEMENT
Dated as of ▇▇▇▇▇ ▇▇, ▇▇▇▇
▇▇▇▇▇▇▇▇ AGREEMENT NUMBER 1
▇▇▇▇▇▇ ▇▇▇ hereby offers for sale to Chase Manhattan Bank USA, National
Association as Interim Eligible Lender Trustee for the benefit of SLM
Funding Corporation ("Funding") under the Interim Trust Agreement dated as
of March 1, 1997 between Funding and the Interim Eligible Lender Trustee,
the entire right, title and interest of ▇▇▇▇▇▇ ▇▇▇ in the Loans described in
the ▇▇▇▇ of Sale and Loan Transmittal Summary Form incorporated herein and,
to the extent indicated below, the Interim Eligible Lender Trustee for the
benefit of Funding accepts ▇▇▇▇▇▇ Mae's offer. In order to qualify as
Eligible Loans, no payment of principal or interest shall be more than
ninety (90) days Delinquent as of the Cutoff Date which date shall be March
3, 1997.
TERMS, CONDITIONS AND COVENANTS
In consideration of the Purchase ▇▇▇▇▇, ▇▇▇▇▇▇ Mae hereby sells to the
Interim Eligible Lender Trustee for the benefit of Funding the entire right,
title and interest of ▇▇▇▇▇▇ ▇▇▇ in the Loans accepted for purchase, subject
to all the terms and conditions of the Purchase Agreement Master
Securitization Terms Number 1000 ("Master Terms") and any amendments
thereto, incorporated herein by reference, among ▇▇▇▇▇▇ Mae, Funding, and
the Interim Eligible Lender Trustee. The Initial Payment of the Loans shall
equal $2,039,022,394 (equal to $2,044,057,624 (representing the offering
price of the Securities less underwriters' commissions) less $5,010,230
(representing the Reserve Account Initial Deposit), less $25,000
(representing the initial deposit into the Collection Account).
This document shall constitute a Purchase Agreement as referred to in
the Master Terms and, except as modified herein, each term used herein shall
have the same meaning as in the Master Terms. All references in the Master
Terms to Loans or Eligible Loans shall be deemed to refer to the Loans
governed by this Purchase Agreement. ▇▇▇▇▇▇ ▇▇▇ hereby makes, as of the date
hereof, all the representations and warranties contained in the Master Terms
and makes such representations and warranties with respect to the Loans
governed by this Purchase Agreement.
▇▇▇▇▇▇ Mae authorizes the Interim Eligible Lender Trustee for the
benefit of Funding to use a copy of the ▇▇▇▇ of Sale, including the Loan
Transmittal Summary Form attached to the ▇▇▇▇ of Sale (in lieu of OE Form
1074), as official notification to the Guarantor of assignment to the
Interim Eligible Lender Trustee on behalf of Funding of the Loans on the
date of purchase.
1
The parties hereto intend that the transfer of Loans described in the
▇▇▇▇ of Sale and Loan Transmittal Summary Form be, and be construed as, a
valid sale of such Loans from ▇▇▇▇▇▇ Mae to the Interim Eligible Lender
Trustee for the benefit of Funding. However, in the event that
notwithstanding the intention of the parties, such transfer is deemed to be
a transfer for security, then ▇▇▇▇▇▇ ▇▇▇ hereby grants to the Interim
Eligible Lender Trustee for the benefit of Funding a first priority security
interest in and to all Loans described in the ▇▇▇▇ of Sale and Loan
Transmittal Summary Form to secure a loan in an amount equal to the Purchase
Price of such loans.
STUDENT LOAN MARKETING SLM FUNDING CORPORATION
ASSOCIATION (Purchaser)
(Seller)
By: /s/ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
------------------------------------ --------------------------------
Name: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Name:
---------------------------------- ------------------------------
Title: V.P., Corporate Secretary Title:
Student Loan Marketing Association ------------------------------
----------------------------------
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
Not in its individual capacity but
solely as Interim Eligible Lender Trustee
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------
Name:
----------------------------------
Title:
----------------------------------
2
PURCHASE AGREEMENT NUMBER 1
BLANKET ENDORSEMENT DATED MARCH 20, 1997
Student Loan Marketing Association ("▇▇▇▇▇▇ Mae"), by execution of this
instrument, hereby endorses the attached promissory note which is one (1) of the
promissory notes ("the Notes") described in the ▇▇▇▇ of Sale executed by ▇▇▇▇▇▇
Mae in favor of Chase Manhattan Bank USA, National Association as the Interim
Eligible Lender Trustee for the benefit of SLM Funding Corporation ("Funding").
This endorsement is in blank, unrestricted form and without recourse except as
provided in Section 6 of the Master Terms referred to in the Purchase Agreement
among ▇▇▇▇▇▇ ▇▇▇, Funding, and the Interim Eligible Lender Trustee which covers
this promissory note.
This endorsement may be effected by attaching either this instrument or
a facsimile hereof to each or any of the Notes.
Notwithstanding the foregoing, ▇▇▇▇▇▇ Mae agrees to individually
endorse each Note in the form provided by Funding as Funding may from time to
time require or if such individual endorsement is required by the Guarantor of
the Note.
THE SALE AND PURCHASE OF THE LOANS SHALL BE SUBJECT TO THE TERMS, CONDITIONS AND
COVENANTS, INCLUDING THE BLANKET ENDORSEMENT, AS SET FORTH IN THE PURCHASE
AGREEMENT. BY EXECUTION HEREOF, ▇▇▇▇▇▇ ▇▇▇ ACKNOWLEDGES THAT ▇▇▇▇▇▇ MAE HAS
READ, UNDERSTANDS AND AGREES TO BE BOUND BY ALL TERMS, CONDITIONS AND COVENANTS
OF THE PURCHASE AGREEMENT. THE SALE AND PURCHASE SHALL BE CONSUMMATED UPON
FUNDING'S PAYMENT TO ▇▇▇▇▇▇ ▇▇▇ OF THE INITIAL PAYMENT (AS DEFINED IN THE MASTER
TERMS) AND, UNLESS OTHERWISE AGREED BY ▇▇▇▇▇▇ MAE AND FUNDING, SHALL BE
EFFECTIVE AS OF THE DATE OF THE ▇▇▇▇ OF SALE.
======================================
SELLER PURCHASER
==================================== ===================================
Student Loan Marketing Association Chase Manhattan Bank USA,
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. National Association,
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ not in its individual capacity
but solely as Interim Eligible
Lender Code: _____________ Lender Trustee for the benefit
of the SLM Funding Corporation
By: /s/ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ under the Interim Trust
--------------------------------- Agreement dated Mar. 1, 1997
(Signature of Authorized
Officer of Seller)
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
Name: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ --------------------------------
------------------------------- (Signature of Authorized
Signatory for Purchaser)
Title: V.P., Associate General
Counsel and Corporate Secretary Name:
------------------------------- ------------------------------
Title:
------------------------------
Date of Purchase: Mar. 20, 1997
======================================
----------------------------------------------------------------
NOTE: Boxed areas on this form are to be completed by Purchaser.
----------------------------------------------------------------
1
▇▇▇▇ OF SALE DATED MARCH 20, 1997
The undersigned ("▇▇▇▇▇▇ Mae"), for value received and pursuant to the
terms and conditions of Purchase Agreement Number 1 ("Purchase Agreement") among
SLM Funding Corporation ("Funding"), and Chase Manhattan Bank USA, National
Association as Interim Eligible Lender Trustee for the benefit of Funding under
the Interim Trust Agreement dated as of October 1, 1996 between Funding and the
Interim Eligible Lender Trustee, does hereby sell, assign and convey to the
Interim Eligible Lender Trustee for the benefit of Funding and its assignees all
right, title and interest of ▇▇▇▇▇▇ ▇▇▇, including the insurance interest of
▇▇▇▇▇▇ Mae under the Federal Family Education Loan Program (20 U.S.C. 1071 et
seq.), in the Loans identified herein which the Interim Eligible Lender Trustee
for the benefit of Funding has accepted for purchase. The portfolio accepted for
purchase by the Interim Eligible Lender Trustee for the benefit of Funding and
the effective date of sale and purchase are described below and the individual
Accounts are listed on the Schedule A attached hereto.
▇▇▇▇▇▇ ▇▇▇ hereby makes the representations and warranties set forth in
Section 5 of the Purchase Agreement Master Securitization Terms Number 1000
incorporated by reference in the Purchase Agreement. ▇▇▇▇▇▇ Mae authorizes the
Interim Eligible Lender Trustee on behalf of Funding to use a copy of this
document (in lieu of OE Form 1074) as official notification to the Guarantor(s)
of assignment to the Interim Eligible Lender Trustee for the benefit of Funding
of the Loans on the date of purchase.
LISTING OF LOANS
OFFERED BY ACCEPTED BY ELIGIBLE
SELLER LENDER TRUSTEE
Number of Principal Number of Principal
LOAN TYPE Loans* Balance* Loans Balance
--------------------------------------------------------------------------------
SUBSIDIZED ▇▇▇▇▇▇▇▇
Interim 144,627 419,501,891 144,627 419,501,891
Repayment 333,875 929,107,654 333,875 929,107,654
478,502 1,348,609,545 478,502 1,348,609,545
UNSUBSIDIZED ▇▇▇▇▇▇▇▇
Deferred 51,985 173,255,457 51,985 173,255,457
Repayment 83,169 264,733,902 83,169 264,733,902
135,154 437,989,359 135,154 437,989,359
PLUS/SLS
Deferred 9,957 44,801,024 9,957 44,801,024
Non-Deferred 43,135 172,691,935 43,135 172,691,935
53,092 217,492,959 53,092 217,492,959
CONSOLIDATION 0 0 0 0
TOTAL 666,748 $2,004,091,863 666,748 $2,004,091,863
======= ============== ======= ==============
ADDITIONAL LOAN CRITERIA
Not in claims status, not previously rejected
Not in litigation
Last disbursement is greater than 120 days from cutoff date
Loan is not swap-pending
---------------
*Based upon ▇▇▇▇▇▇ Mae's estimated calculations, which may be adjusted upward
or downward based upon Fundings's reconciliation.
Guarantor(s):
American Student Assistance Guarantor
California Student Aid Commission
Connecticut Student Loan Foundation
Educational Credit Management Corporation
Florida Department of Education Office of Student Financial Assistance
Great Lakes Higher Education Corporation
Illinois Student Assistance Commission
Iowa College Student Aid Commission
Kentucky Higher Education Assistance Authority
Louisiana Student Financial Assistance Commission
Michigan Higher Education Assistance Authority
Missouri Coordinating Board for Higher Education
New Jersey Higher Education Assistance Authority
N.Y. State Higher Education Services Corporation
Northstar Guarantee Inc.
Northwest Education Loan Association
Oklahoma State Regents for Higher Education
Oregon State Scholarship Commission
Pennsylvania Higher Education Assistance Agency
Student Loan Guarantee Foundation of Arkansas, Inc.
Tennessee Student Assistance Corporation
Texas Guaranteed Student Loan Corporation
United Student Aid Funds, Inc.
SELLER ======================================
==================================== PURCHASER
Student Loan Marketing Association ===================================
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇. Chase Manhattan Bank USA,
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇ National Association,
not in its individual capacity
Lender Code: _____________ but solely as Interim Eligible
Lender Trustee for the benefit
By: /s/ ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ of SLM Funding Corporation
---------------------------------
(Signature of Authorized By: /s/ ▇▇▇▇ ▇▇▇▇▇▇
Officer of Seller) --------------------------------
(Signature of Authorized
Name: ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ Signatory for Purchaser)
-------------------------------
Name:
Title: V.P., Associate General ------------------------------
Counsel and Corporate Secretary
------------------------------- Title:
------------------------------
Date of Purchase: __________________
======================================
================================================================
NOTE: Boxed areas on this form are to be completed by Purchaser.
================================================================
2