Exhibit 4.1
EXECUTION COPY
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TRUST AGREEMENT
among
SIGNET BANK,
as Depositor,
SIGNET STUDENT LOAN CORPORATION
and
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity but solely
as Eligible Lender Trustee
Dated as of November 1, 1996
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TABLE OF CONTENTS
Page
ARTICLE I
Definitions and Usage...................... 1
ARTICLE II
Organization
SECTION 2.01. Name....................................................... 1
SECTION 2.02. Office..................................................... 1
SECTION 2.03. Purposes and Powers........................................ 1
SECTION 2.04. Appointment of Eligible Lender Trustee..................... 2
SECTION 2.05. Initial Capital Contribution of
Trust Estate.................................... 2
SECTION 2.06. Declaration of Trust........................................ 3
SECTION 2.07. Liability of the Certificate holders........................ 3
SECTION 2.08. Title to Trust Property..................................... 4
SECTION 2.09. Representations and Warranties of
the Depositor .................................. 4
SECTION 2.10. Federal Income Tax Allocations.............................. 5
Section 2.11. Maintenance of the Demand Note.............................. 6
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.01. Initial Beneficial Ownership............................... 6
SECTION 3.02. The Trust Certificates..................................... 7
SECTION 3.03. Authentication of Trust Certificates....................... 7
SECTION 3.04. Registration of Transfer and Exchange
of Trust Certificates.......................... 7
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen
Trust Certificates............................. 9
SECTION 3.06. Persons Deemed Owners...................................... 9
SECTION 3.07. Access to List of Certificateholders'
Names and Addresses............................ 10
SECTION 3.08. Maintenance of Office or Agency............................ 10
SECTION 3.09. Appointment of Certificate Paying Agent.................... 10
SECTION 3.10. Disposition by Company .................................... 11
SECTION 3.11. Book-Entry Certificates.................................... 12
SECTION 3.12. Notices to Clearing Agency................................. 13
SECTION 3.13. Definitive Certificates.................................... 13
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ARTICLE IV
Actions by Eligible Lender Trustee
SECTION 4.01. Prior Notice to Certificateholders
with Respect to Certain Matters................ 14
SECTION 4.02. Action by Certificateholders with
Respect to Certain Matters..................... 15
SECTION 4.03. Action by Certificateholders with
Respect to Bankruptcy.......................... 15
SECTION 4.04. Restrictions on Certificateholders'
Power.......................................... 15
SECTION 4.05. Majority Control........................................... 15
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Application of Trust Funds................................. 16
SECTION 5.02. Method of Payment.......................................... 17
SECTION 5.03. No Segregation of Moneys; No Interest...................... 17
SECTION 5.04. Accounting and Reports to the
Noteholders, Certificateholders,
the Internal Revenue Service
and Others..................................... 17
SECTION 5.05. Signature on Returns;
Tax Matters Partner............................ 18
SECTION 5.06. Check-The-Box Proposal ..................................18
ARTICLE VI
Authority and Duties of Eligible Lender Trustee
SECTION 6.01. General Authority.......................................... 19
SECTION 6.02. General Duties............................................. 19
SECTION 6.03. Action upon Instruction.................................... 20
SECTION 6.04. No Duties Except as Specified in this
Agreement, the Loan Sale Agreement, the
Master Servicing Agreement, the Administration
Agreement or in Instructions................... 21
SECTION 6.05. No Action Except Under Specified
Documents or Instructions...................... 22
SECTION 6.06. Restrictions............................................... 22
ARTICLE VII
Concerning the Eligible Lender Trustee
SECTION 7.01. Acceptance of Trusts and Duties............................ 22
SECTION 7.02. Furnishing of Documents.................................... 24
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SECTION 7.03. Representations and Warranties............................. 24
SECTION 7.04. Reliance; Advice of Counsel................................ 25
SECTION 7.05. Not Acting in Individual Capacity.......................... 25
SECTION 7.06. Eligible Lender Trustee Not Liable
for Trust Certificates or Student Loans........ 26
SECTION 7.07. Eligible Lender Trustee May Own Trust
Certificates and Notes......................... 26
ARTICLE VIII
Compensation of Eligible Lender Trustee
SECTION 8.01. Eligible Lender Trustee's Fees
and Expenses................................... 27
SECTION 8.02. Payments to the Eligible Lender Trustee.................... 27
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement............................. 27
SECTION 9.02. Dissolution upon Bankruptcy of
the Company.................................... 29
ARTICLE X
Successor Eligible Lender Trustees and
Additional Eligible Lender Trustees
SECTION 10.01. Eligibility Requirements for Eligible
Lender Trustee................................ 30
SECTION 10.02. Resignation or Removal of Eligible
Lender Trustee................................ 30
SECTION 10.03. Successor Eligible Lender Trustee......................... 32
SECTION 10.04. Merger or Consolidation of Eligible
Lender Trustee................................ 31
SECTION 10.05. Appointment of Co-Eligible Lender
Trustee or Separate Eligible Lender
Trustee....................................... 32
ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments................................ 35
SECTION 11.02. No Legal Title to Trust Estate
in Certificateholders......................... 36
SECTION 11.03. Limitations on Rights of Others........................... 36
SECTION 11.04. Notices................................................... 37
SECTION 11.05. Severability.............................................. 37
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SECTION 11.06. Separate Counterparts..................................... 37
SECTION 11.07. Successors and Assigns.................................... 37
SECTION 11.08. No Petition............................................... 38
SECTION 11.09. No Recourse............................................... 38
SECTION 11.10. Headings.................................................. 38
SECTION 11.11. Governing Law............................................. 38
EXHIBIT A Form of Trust Certificate
EXHIBIT B Form of Certificate Depository Agreement
EXHIBIT C Form of Certificate of Trust
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TRUST AGREEMENT dated as of November 1, 1996, among SIGNET
BANK, a Virginia banking corporation, as Depositor, SIGNET STUDENT LOAN
CORPORATION, a Virginia corporation (the "Company") and THE FIRST NATIONAL BANK
OF CHICAGO, a national banking association, as Eligible Lender Trustee.
The Depositor, the Company and the Eligible Lender Trustee
hereby 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, 1996, among
the Signet Student Loan Trust 1996-A, as Issuer, the Depositor, as
Administrator, and The Bank of New York, as Indenture Trustee, which also
contains rules as to construction and usage that shall be applicable herein.
ARTICLE II
Organization
SECTION 2.01. Name. The Trust created hereby shall be known as
"Signet Student Loan Trust 1996-A", in which name the Eligible Lender Trustee
may engage in the transactions contemplated hereby, make and execute contracts
and other instruments on behalf of the Trust and ▇▇▇ and be sued.
SECTION 2.02. Office. The office of the Trust shall be in care
of the Eligible Lender Trustee at its Corporate Trust Office or at such other
address as the Eligible Lender Trustee may designate by written notice to the
Certificateholders and the Depositor.
SECTION 2.03. Purposes and Powers. The purpose of the Trust
is to engage in the following activities:
(i) to issue the Notes pursuant to the Indenture and the Trust
Certificates pursuant to this Agreement and to sell the Notes and the
Trust Certificates in one or more transactions;
(ii) with the proceeds of the sale of the Notes and the Trust
Certificates, to purchase the Initial Financed Student Loans, to fund
the Pre-Funding Account and the Reserve Account, and to pay the
organizational, start-up and
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transactional expenses of the Trust and to pay the balance to the
Depositor pursuant to the Loan Sale Agreement;
(iii) to acquire and hold any Additional Student Loans to be
conveyed to the Trust subsequent to the Closing Date pursuant to the
Loan Sale Agreement;
(iv) to assign, grant, transfer, pledge, mortgage and convey the
Trust Estate pursuant to the Indenture and to hold, manage and
distribute to the Certificateholders pursuant to the terms of the
Master Servicing Agreement any portion of the Trust Estate released
from the Lien of, and remitted to the Trust pursuant to, the Indenture;
(v) to enter into and perform its obligations under the Basic
Documents to which it is to be a party;
(vi) to engage in those activities, including entering into
agreements, that are necessary, suitable or convenient to accomplish
the foregoing or are incidental thereto or connected therewith; and
(vii) subject to compliance with the Basic Documents, to engage in
such other activities as may be required in connection with
conservation of the Trust Estate and the making of distributions to the
Certificateholders, the Noteholders and the others specified in Section
2(d) of the Administration Agreement.
The Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this Agreement
or the other Basic Documents.
SECTION 2.04. Appointment of Eligible Lender Trustee. The
Depositor hereby appoints the Eligible Lender Trustee as trustee of the Trust
effective as of the date hereof, to have all of the rights, powers and duties
set forth herein.
SECTION 2.05. Initial Capital Contribution of Trust Estate.
The Depositor hereby sells, assigns, transfers, conveys and sets over to the
Eligible Lender Trustee, as of the date hereof, the sum of $1.00. The Eligible
Lender Trustee hereby acknowledges receipt in trust from the Depositor, as of
the date hereof, of the foregoing contribution, which shall constitute the
initial Trust Estate and shall be deposited in the Collection Account. The
Depositor shall pay the organizational expenses of the Trust as they may arise
or shall, upon the request of the Eligible Lender Trustee, promptly reimburse
the Eligible Lender
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Trustee for any such expenses paid by the Eligible Lender Trustee.
SECTION 2.06. Declaration of Trust. The Eligible Lender
Trustee hereby declares that it will hold the Trust Estate in trust upon and
subject to the conditions set forth herein for the use and benefit of the
Certificateholders, subject to the obligations of the Trust under the other
Basic Documents. It is the intention of the parties hereto that the Trust
constitute a trust under the Business Trust Statute and that this Agreement
constitute the governing instrument of such trust. It is the intention of the
parties hereto that, solely for income and franchise tax purposes, the Trust
shall be treated as a partnership, with the assets of the partnership being the
Financed Student Loans and other assets held by the Trust, the partners of the
partnership being the Certificateholders (including the Depositor and the
Company in its capacity as recipient of certain distributions from the Reserve
Account), and the Notes being debt of the partnership. The parties agree that,
unless otherwise required by appropriate tax authorities, the Trust will file or
cause to be filed annual or other necessary returns, if any, reports and other
forms consistent with the characterization of the Trust as a partnership for
such tax purposes. Effective as of the date hereof, the Eligible Lender Trustee
shall have all rights, powers and duties set forth herein and in the Business
Trust Statute with respect to accomplishing the purposes of the Trust. The
Eligible Lender Trustee and the Delaware Trustee shall file the Certificate of
Trust with the Secretary of State of the State of Delaware pursuant to ss. 3801
of the Business Trust Statute on or before the Closing Date.
SECTION 2.07. Liability of the Certificateholders. (a) The
Company shall be liable directly to and will indemnify the injured party for all
losses, claims, damages, liabilities and expenses of the Trust (including
Expenses, to the extent not paid out of the Trust Estate) to the extent that the
Company would be liable if the Trust were a partnership under the Delaware
Revised Uniform Limited Partnership Act in which the Company were a general
partner; provided, however, that the Company shall not be liable for any losses
incurred by a Certificateholder or a Certificate Owner in the capacity of an
investor in the Certificates or a Noteholder or a Note Owner in the capacity of
an investor in the Notes. In addition, any third party creditors of the Trust
(other than in connection with the obligations described in the preceding
sentence for which the Company shall not be liable) shall be deemed third party
beneficiaries of this paragraph. The obligations of the Company under this
paragraph shall be evidenced by the Trust Certificates described in Section
3.10, which shall be deemed to be a separate class of Trust Certificates from
all other Trust Certificates
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issued by the Trust; provided that the rights and obligations evidenced by all
Trust Certificates, regardless of class, except as provided in this Section,
shall be identical.
(b) No Certificateholder, other than to the extent set forth
in paragraph (a), shall have any personal liability for any liability or
obligation of the Trust.
SECTION 2.08. Title to Trust Property. Legal title to the
Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Trust Estate to be vested in a trustee or trustees, in which case
title shall be deemed to be vested in the Eligible Lender Trustee, a co-trustee
and/or a separate trustee, as the case may be; provided that legal title to the
Financed Student Loans shall be vested at all times in the Eligible Lender
Trustee on behalf of the Trust.
SECTION 2.09. Representations and Warranties of the Depositor.
The Depositor hereby represents and warrants to the Eligible Lender Trustee
that:
(a) The Depositor is duly organized and validly existing as a
banking corporation in good standing under the laws of the Commonwealth
of Virginia, with corporate power and authority to own its properties
and to conduct its business as such properties are currently owned and
such business is presently conducted.
(b) The Depositor is duly qualified to do business as a
foreign corporation in good standing, and has obtained all necessary
licenses and approvals in all jurisdictions in which the ownership or
lease of property or the conduct of its business shall require such
qualifications.
(c) The Depositor has the corporate power and authority to
execute and deliver this Agreement and to carry out its terms; the
Depositor has full corporate power and authority to sell and assign the
property to be sold and assigned to and deposited with the Trust (or
with the Eligible Lender Trustee on behalf of the Trust) and the
Depositor has duly authorized such sale and assignment and deposit to
the Trust (or to the Eligible Lender Trustee on behalf of the Trust) by
all necessary corporate action; and the execution, delivery and
performance of this Agreement has been duly authorized by the Depositor
by all necessary corporate action.
(d) This Agreement constitutes a legal, valid and binding
obligation of the Depositor enforceable in
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accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization and similar laws relating to creditors'
rights generally or the rights of creditors of banks the deposit
accounts of which are insured by the FDIC and subject to general
principles of equity.
(e) The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not conflict with,
result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time or both) a default
under, the articles of incorporation or by-laws of the Depositor, or
any material indenture, agreement or other instrument to which the
Depositor is a party or by which it is 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 best of 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 Depositor or its
properties.
(f) There are no proceedings or investigations pending or, to
the Depositor's best knowledge, threatened before any court, regulatory
body, administrative agency or other governmental instrumentality
having jurisdiction over the Depositor or its properties: (A) asserting
the invalidity of this Agreement, (B) seeking to prevent the
consummation of any of the transactions contemplated by this Agreement
or (C) 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, this Agreement.
SECTION 2.10. Federal Income Tax Allocations. Net income of
the Trust for any month as determined for Federal income tax purposes (and each
item of income, gain, loss and deduction entering into the computation thereof)
shall be allocated:
(a) among the Certificateholders as of the close of business
on the last day of such month, in proportion to their ownership of
principal amount of Trust Certificates on such date, an amount of net
income up to the sum of (i) the Certificateholders' Interest
Distribution Amount for the related Interest Payment Date, (ii) the
portion of the Certificateholders' Interest LIBOR Carryover, if any,
for the related Distribution Date allocable to such month, (iii)
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interest on the excess, if any, of the Certificateholders' Interest
Distribution Amount for the preceding Interest Payment Date over the
amount in respect of interest that is actually distributed to
Certificateholders on such preceding Interest Payment Date, to the
extent permitted by law, at the Certificate Rate for such month and
(iv) the portion of the market discount on the Financed Student Loans
accrued during such month that is allocable to the excess, if any, of
the initial aggregate principal amount of the Trust Certificates over
their initial aggregate issue price; and
(b) to the Depositor and the Company in the proportion of 99%
and 1%, respectively, to the extent of any remaining net income.
If the net income of the Trust for any month is insufficient for the allocations
described in clause (a) above, subsequent net income shall first be allocated to
make up such shortfall before being allocated as provided in clause (b) above.
Net losses of the Trust, if any, for any month as determined for Federal income
tax purposes (and each item of income, gain, loss and deduction entering into
the computation thereof) shall be allocated to the Depositor and the Company in
the proportion of 99% and 1% respectively, to the extent the Depositor and the
Company are reasonably expected to bear the economic burden of such net losses,
and any remaining net losses shall be allocated among the remaining
Certificateholders as of the close of business on the last day of such month in
proportion to their ownership of principal amount of Trust Certificates on such
Record Date. The Depositor and the Company are authorized to modify the
allocations in this paragraph if necessary or appropriate, in their sole
discretion, for the allocations to fairly reflect the economic income, gain or
loss to the Depositor and the Company or to the Certificateholders, or as
otherwise required by the Code.
SECTION 2.11. Maintenance of the Demand Note. To the fullest
extent permitted by applicable law, the Company agrees that it shall not sell,
convey, pledge, transfer or otherwise dispose of the Demand Note.
ARTICLE III
Trust Certificates and Transfer of Interests
SECTION 3.01. Initial Beneficial Ownership. Upon the formation
of the Trust by the contribution by the Depositor pursuant to Section 2.05 and
until the issuance of the Trust Certificates, the Depositor shall be the sole
beneficial owner of the Trust.
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SECTION 3.02. The Trust Certificates. The Trust Certificates
shall be issued in denominations of $1,000 or in integral multiples of $l,000 in
excess thereof; provided, however, that the Trust Certificates issued to the
Company pursuant to Section 3.10 may be issued in such denomination as to
include any residual amount. The Trust Certificates shall be executed on behalf
of the Trust by manual or facsimile signature of an authorized officer of the
Eligible Lender Trustee. Trust Certificates bearing the manual or facsimile
signatures of individuals who were, at the time when such signatures shall have
been affixed, authorized to sign on behalf of the Trust, shall be validly issued
by the Trust and entitled to the benefits of this Agreement, notwithstanding
that such individuals or any of them shall have ceased to be so authorized prior
to the authentication and delivery of such Trust Certificates or did not hold
such offices at the date of authentication and delivery of such Trust
Certificates.
A Person shall become a Certificateholder, and shall be
entitled to the rights and subject to the obligations of a Certificateholder
hereunder, upon such Person's acceptance of a Trust Certificate duly registered
in such Person's name pursuant to Section 3.04.
SECTION 3.03. Authentication of Trust Certificates.
Concurrently with the sale of the Initial Financed Student Loans to the Trust
pursuant to the Loan Sale Agreement, the Eligible Lender Trustee shall cause the
Trust Certificates in an aggregate principal amount equal to the Initial
Certificate Balance to be executed on behalf of the Trust, authenticated and
delivered to or upon the written order of the Depositor, signed by its chairman
of the board, its president or any vice president, without further action by the
Depositor, in authorized denominations. No Trust Certificate shall entitle its
holder to any benefit under this Agreement, or shall be valid for any purpose,
unless there shall appear on such Trust Certificate a certificate of
authentication substantially in the form set forth in Exhibit A, executed by the
Eligible Lender Trustee or First Chicago Trust Company of New York, as the
Eligible Lender Trustee's authenticating agent, by manual signature; such
authentication shall constitute conclusive evidence that such Trust Certificate
shall have been duly authenticated and delivered hereunder. All Trust
Certificates shall be dated the date of their authentication. No further Trust
Certificates shall be issued except pursuant to Section 3.04, 3.05 or 3.13
hereunder.
SECTION 3.04. Registration of Transfer and Exchange of Trust
Certificates. The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to
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Section 3.08, a Certificate Register in which, subject to such reasonable
regulations as it may prescribe, the Eligible Lender Trustee shall provide for
the registration of Trust Certificates and of transfers and exchanges of Trust
Certificates as herein provided. The Eligible Lender Trustee shall be the
initial Certificate Registrar.
Upon surrender for registration of transfer of any Trust
Certificate at the office or agency maintained pursuant to Section 3.08, the
Eligible Lender Trustee shall execute, authenticate and deliver (or shall cause
First Chicago Trust Company of New York as its authenticating agent to
authenticate and deliver), in the name of the designated transferee or
transferees, one or more new Trust Certificates in authorized denominations of a
like aggregate amount dated the date of authentication by the Eligible Lender
Trustee or any authenticating agent. At the option of a Certificateholder, Trust
Certificates may be exchanged for other Trust Certificates of authorized
denominations of a like aggregate amount upon surrender of the Trust
Certificates to be exchanged at the office or agency maintained pursuant to
Section 3.08.
Every Trust Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Eligible Lender Trustee and
the Certificate Registrar duly executed by the Certificateholder or his attorney
duly authorized in writing, with such signature guaranteed by an "eligible
guarantor institution" meeting the requirements of the Certificate Registrar,
which requirements include membership or participation in Securities Transfer
Agent's Medallion Program ("STAMP") or such other "signature guarantee program"
as may be determined by the Certificate Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Exchange Act. Each Trust
Certificate surrendered for registration of transfer or exchange shall be
canceled and subsequently disposed of by the Eligible Lender Trustee in
accordance with its customary practice.
No service charge shall be made for any registration of
transfer or exchange of Trust Certificates, but the Eligible Lender Trustee or
the Certificate Registrar may require payment of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection with any transfer
or exchange of Trust Certificates.
The preceding provisions of this Section 3.04 notwithstanding,
the Eligible Lender Trustee shall not be required to make and the Certificate
Registrar need not register transfers or exchanges of Trust Certificates for a
period of 15
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days preceding any Distribution Date with respect to the Trust Certificates.
The Trust Certificates and any beneficial interest in such
Trust Certificates may not be acquired by (a) an employee benefit plan (as
defined in Section 3(3) of ERISA) that is subject to the provisions of Title I
of ERISA, (b) a plan described in Section 4975(e)(1) of the Code or (c) any
entity whose underlying assets include plan assets by reason of a plan's
investment in the entity (each, a "Benefit Plan"). By accepting and holding a
Trust Certificate or an interest therein, the Certificateholder thereof and
Certificate Owner thereof shall be deemed to have represented and warranted that
it is not a Benefit Plan.
SECTION 3.05. Mutilated, Destroyed, Lost or Stolen Trust
Certificates. If (a) any mutilated Trust Certificate shall be surrendered to the
Certificate Registrar, or if the Certificate Registrar shall receive evidence to
its satisfaction of the destruction, loss or theft of any Trust Certificate, and
(b) there shall be delivered to the Certificate Registrar and the Eligible
Lender Trustee such security or indemnity as may be required by them to save
each of them harmless, then in the absence of notice that such Trust Certificate
shall have been acquired by a bona fide purchaser, the Eligible Lender Trustee
on behalf of the Trust shall execute and the Eligible Lender Trustee, or First
Chicago Trust Company of New York, as the Eligible Lender Trustee's
authenticating agent, shall authenticate and deliver, in exchange for or in lieu
of any such mutilated, destroyed, lost or stolen Trust Certificate, a new Trust
Certificate of like tenor and denomination. In connection with the issuance of
any new Trust Certificate under this Section, the Eligible Lender Trustee and
the Certificate Registrar may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Trust Certificate issued pursuant to this Section shall
constitute conclusive evidence of ownership in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Trust Certificate shall be
found at any time.
SECTION 3.06. Persons Deemed Owners. Prior to due presentation
of a Trust Certificate for registration of transfer, the Eligible Lender
Trustee, the Certificate Registrar and any agent of any thereof may treat the
Person in whose name any Trust Certificate shall be registered in the
Certificate Register as the owner of such Trust Certificate for the purpose of
receiving distributions pursuant to Section 5.01 and for all other purposes
whatsoever, and neither the Eligible Lender Trustee, the
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Certificate Registrar nor any agent of any thereof shall be bound by any notice
to the contrary.
SECTION 3.07. Access to List of Certificateholders' Names and
Addresses. The Eligible Lender Trustee shall furnish or cause to be furnished to
the Depositor, within 15 days after receipt by the Eligible Lender Trustee of a
request therefor from the Depositor in writing, a list, in such form as the
Depositor may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date. If three or more
Certificateholders or one or more Certificateholders evidencing not less than
25% of the Certificate Balance apply in writing to the Eligible Lender Trustee,
and such application states that the applicants desire to communicate with other
Certificateholders with respect to their rights under this Agreement or under
the Trust Certificates and such application is accompanied by a copy of the
communication that such applicants propose to transmit, then the Eligible Lender
Trustee shall, within five Business Days after the receipt of such application,
afford such applicants access during normal business hours to the current list
of Certificateholders. Upon receipt of any such application, the Eligible Lender
Trustee will promptly notify the Depositor by providing a copy of such
application and a copy of the list of Certificateholders produced in response
thereto. Each Certificateholder, by receiving and holding a Trust Certificate,
shall be deemed to have agreed not to hold any of the Depositor, the Certificate
Registrar or the Eligible Lender Trustee accountable by reason of the disclosure
of its name and address, regardless of the source from which such information
was derived.
SECTION 3.08. Maintenance of Office or Agency. The Eligible
Lender Trustee shall maintain in the Borough of Manhattan, The City of New York,
an office or offices or agency or agencies where Trust Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Eligible Lender Trustee in respect of the Trust
Certificates and the other Basic Documents may be served. The Eligible Lender
Trustee initially designates ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇ as its principal Corporate Trust Office. The Eligible
Lender Trustee's New York office and its authenticating agent's office are
located at ▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: Corporate Trust
Administration. The Eligible Lender Trustee shall give prompt written notice to
the Depositor and to the Certificateholders of any change in the location of the
Certificate Register or any such office or agency.
SECTION 3.09. Appointment of Certificate Paying Agent. The
Certificate Paying Agent shall make distributions to
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Certificateholders from the amounts received from the Indenture Trustee out of
the Trust Accounts pursuant to Section 5.01 and shall report the amounts of such
distributions to the Eligible Lender Trustee. Any Certificate Paying Agent shall
have the revocable power to receive such funds from the Indenture Trustee for
the purpose of making the distributions referred to above. With respect to any
Certificate Paying Agent other than Signet Trust Company or the Indenture
Trustee, the Eligible Lender Trustee may revoke such power and remove the
Certificate Paying Agent if the Eligible Lender Trustee determines in its sole
discretion that the Certificate Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect. The Certificate Paying
Agent shall initially be Signet Trust Company, and any co-paying agent chosen by
the Eligible Lender Trustee and acceptable to the Administrator and any such
Certificate Paying Agent shall be permitted to resign as Certificate Paying
Agent upon 30 days' written notice to the Eligible Lender Trustee. In the event
that Signet Trust Company or the Indenture Trustee shall no longer be the
Certificate Paying Agent, the Eligible Lender Trustee shall appoint a successor
to act as Certificate Paying Agent (which shall be a bank or trust company). The
Eligible Lender Trustee shall cause such successor Certificate Paying Agent or
any additional Certificate Paying Agent appointed by the Eligible Lender Trustee
to execute and deliver to the Eligible Lender Trustee an instrument in which
such successor Certificate Paying Agent or additional Certificate Paying Agent
shall agree with the Eligible Lender Trustee that as Certificate Paying Agent,
such successor Certificate Paying Agent or additional Certificate Paying Agent
will hold all sums, if any, held by it for payment to the Certificateholders in
trust for the benefit of the Certificateholders entitled thereto until such sums
shall be paid to such Certificateholders. The Certificate Paying Agent shall
return all unclaimed funds to the Eligible Lender Trustee and upon removal of a
Certificate Paying Agent such Certificate Paying Agent shall also return all
funds in its possession to the Eligible Lender Trustee. The provisions of
Sections 7.01, 7.03, 7.04, 7.05 and 8.01 shall apply to the Certificate Paying
Agent, for so long as Signet Trust Company shall act as Certificate Paying Agent
and, to the extent applicable, to any other paying agent appointed hereunder.
Any reference in this Agreement to the Certificate Paying Agent shall include
any co-paying agent unless the context requires otherwise.
SECTION 3.10. Disposition by Company. On and after the
Closing Date, the Company shall retain beneficial and record ownership of Trust
Certificates representing at least 1% of the Certificate Balance. Any attempted
transfer of any Trust Certificate that would reduce such interest of the Company
below 1% of the Certificate Balance shall be void. The Eligible Lender
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Trustee shall cause any Trust Certificate issued to the Company on the Closing
Date (and any Trust Certificate issued in exchange therefor) to contain a legend
stating "THIS TRUST CERTIFICATE IS NONTRANSFERABLE EXCEPT IN ACCORDANCE WITH
SECTION 3.10 OF THE TRUST AGREEMENT".
SECTION 3.11. Book-Entry Certificates. The Trust Certificates
will be issued in the form of a typewritten Trust Certificate or Trust
Certificates representing Book-Entry Certificates, to be delivered to The
Depository Trust Company, the initial Clearing Agency, by, or on behalf of, the
Trust; provided, however, that one Definitive Certificate (as defined below) may
be issued to the Company pursuant to Section 3.10. Such Book-Entry Certificate
or Book-Entry Certificates shall be registered on the Certificate Register in
the name of Cede & Co., the nominee of the initial Clearing Agency, and no
Certificate Owner (other than the Company) will receive a Definitive Certificate
representing such Certificate Owner's interest in such Trust Certificate, except
as provided in Section 3.13. Unless and until definitive, fully registered Trust
Certificates (the "Definitive Certificates") have been issued to Certificate
Owners pursuant to Section 3.13:
(i) the provisions of this Section shall be in full force and
effect;
(ii) the Certificate Registrar and the Eligible Lender Trustee shall
be entitled to deal with the Clearing Agency for all purposes of this
Agreement (including the payment of principal of and interest on the
Trust Certificates and the giving of instructions or directions
hereunder) as the sole Certificateholder and shall have no obligation
to the Certificate Owners;
(iii) to the extent that the provisions of this Section conflict
with any other provisions of this Agreement, the provisions of this
Section shall control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and shall be limited to those established
by law and agreements between such Certificate Owners and the Clearing
Agency and/or the Clearing Agency Participants. Pursuant to the
Certificate Depository Agreement, unless and until Definitive
Certificates are issued pursuant to Section 3.13, the Clearing Agency
will make book-entry transfers among the Clearing Agency Participants
and receive and transmit payments of principal of and interest on the
Trust Certificates to such Clearing Agency Participants; and
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(v) whenever this Agreement requires or permits actions to be
taken based upon instructions or directions of Certificateholders of
Trust Certificates evidencing a specified percentage of the Certificate
Balance, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions to such
effect from Certificate Owners and/or Clearing Agency Participants
owning or representing, respectively, such required percentage of the
beneficial interest in the Trust Certificates and has delivered such
instructions to the Eligible Lender Trustee.
SECTION 3.12. Notices to Clearing Agency. Whenever a notice or
other communication to the Certificateholders is required under this Agreement
at a time when Book-Entry Certificates have been issued and are outstanding and
unless and until Definitive Certificates shall have been issued to Certificate
Owners pursuant to Section 3.13, the Eligible Lender Trustee shall give all such
notices and communications specified herein to be given to Certificateholders to
the Clearing Agency, and shall have no obligations to the Certificate Owners.
SECTION 3.13. Definitive Certificates. If (i) the
Administrator advises the Eligible Lender Trustee in writing that the Clearing
Agency is no longer willing or able to discharge properly its responsibilities
with respect to the Trust Certificates, and the Administrator is unable to
locate a qualified successor, (ii) the Administrator at its option advises the
Eligible Lender Trustee in writing that it elects to terminate the book-entry
system through the Clearing Agency or (iii) after the occurrence of an Event of
Default or a Servicer Default, Certificate Owners representing beneficial
interests aggregating at least a majority of the Certificate Balance advise the
Clearing Agency (which shall then notify the Eligible Lender Trustee) in writing
that the continuation of a book-entry system through the Clearing Agency is no
longer in the best interest of the Certificate Owners, then the Eligible Lender
Trustee shall cause the Clearing Agency to notify all Certificate Owners of the
occurrence of any such event and of the availability of the Definitive
Certificates to Certificate Owners requesting the same. Upon surrender to the
Eligible Lender Trustee of the typewritten Trust Certificate or Trust
Certificates representing the Book-Entry Certificates by the Clearing Agency,
accompanied by registration instructions, the Eligible Lender Trustee shall
execute and authenticate the Definitive Certificates in accordance with the
instructions of the Clearing Agency. Neither the Certificate Registrar nor the
Eligible Lender Trustee shall be liable for any delay in delivery of such
instructions and may conclusively rely on, and shall be protected in relying on,
such instructions. Upon the issuance of Definitive Certificates, the
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Eligible Lender Trustee shall recognize the registered holders of the Definitive
Certificates as Certificateholders. The Definitive Certificates shall, at the
expense of the Depositor, be printed, lithographed or engraved or may be
produced in any other manner as is reasonably acceptable to the Eligible Lender
Trustee, as evidenced by its execution thereof.
ARTICLE IV
Actions by Eligible Lender Trustee
SECTION 4.01. Prior Notice to Certificateholders with Respect
to Certain Matters. With respect to the following matters, the Eligible Lender
Trustee shall not take action unless at least 30 days before the taking of such
action, the Eligible Lender Trustee shall have notified the Certificateholders
and the Rating Agencies in writing of the proposed action and the
Certificateholders shall not have notified the Eligible Lender Trustee in
writing prior to the 30th day after such notice is given that such
Certificateholders have withheld consent or provided alternative direction:
(a) the initiation of any material claim or lawsuit by the
Trust (except claims or lawsuits brought in connection with the
collection of the Financed Student Loans) and the compromise of any
material action, claim or lawsuit brought by or against the Trust
(except with respect to the aforementioned claims or lawsuits for
collection of Financed Student Loans);
(b) the election by the Trust to file an amendment to the
Certificate of Trust;
(c) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture
in circumstances where the consent of any Noteholder is not required
and such amendment materially adversely affects the interest of the
Certificateholders;
(e) the amendment, change or modification of the
Administration Agreement, except to cure any ambiguity or in connection
with a transaction permitted by Section 25 thereof or to amend or
supplement any provision in a manner or add any provision that would
not materially adversely affect the interests of the
Certificateholders; or
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(f) the appointment pursuant to the Indenture of a successor
Note Registrar, Paying Agent or Indenture Trustee or pursuant to this
Agreement of a successor Certificate Paying Agent or Certificate
Registrar, or the consent to the assignment by the Note Registrar,
Paying Agent or Indenture Trustee or Certificate Paying Agent or
Certificate Registrar of its obligations under the Indenture or this
Agreement, as applicable.
SECTION 4.02. Action by Certificateholders with Respect to
Certain Matters. The Eligible Lender Trustee shall not have the power, except
upon the direction of the Certificateholders, to (a) remove the Administrator
under the Administration Agreement pursuant to Section 12 thereof, (b) appoint a
successor Administrator pursuant to Section 12 of the Administration Agreement,
(c) remove the Master Servicer under the Master Servicing Agreement pursuant to
Section 6.01 thereof or (d) except as expressly provided in the Basic Documents,
sell the Financed Student Loans after the termination of the Indenture. The
Eligible Lender Trustee shall take the actions referred to in the preceding
sentence only upon written instructions signed by the Certificateholders.
SECTION 4.03. Action by Certificateholders with Respect to
Bankruptcy. The Eligible Lender Trustee shall not have the power to commence a
voluntary proceeding in bankruptcy relating to the Trust without the unanimous
prior approval of all Certificateholders and the delivery to the Eligible Lender
Trustee by each such Certificateholder of a certificate certifying that such
Certificateholder reasonably believes that the Trust is insolvent.
SECTION 4.04. Restrictions on Certificateholders' Power. The
Certificateholders shall not direct the Eligible Lender Trustee to take or
refrain from taking any action if such action or inaction would be contrary to
any obligation of the Trust or the Eligible Lender Trustee under this Agreement
or any of the other Basic Documents or would be contrary to Section 2.03 nor
shall the Eligible Lender Trustee be permitted to follow any such direction, if
given.
SECTION 4.05. Majority Control. Except as expressly provided
herein, any action that may be taken by the Certificateholders under this
Agreement may be taken by the Certificateholders of Trust Certificates
evidencing not less than a majority of the Certificate Balance. Except as
expressly provided herein, any written notice of the Certificateholders
delivered pursuant to this Agreement shall be effective if signed by
Certificateholders of Trust Certificates evidencing not less
15
than a majority of the Certificate Balance at the time of the delivery of such
notice.
ARTICLE V
Application of Trust Funds; Certain Duties
SECTION 5.01. Application of Trust Funds. (a) On each
Interest Payment Date and Distribution Date, the Eligible Lender Trustee will,
or will cause the Certificate Paying Agent to, distribute to Certificateholders,
on a pro rata basis, amounts received from the Indenture Trustee for
distribution to the Certificateholders pursuant to Sections 2(d), 2(e) and 2(f)
of the Administration Agreement on such Interest Payment Date or Distribution
Date.
(b) On each Distribution Date, the Eligible Lender Trustee
shall send to each Certificateholder the statement provided to the Eligible
Lender Trustee by the Administrator pursuant to Section 2(g) of the
Administration Agreement on such Distribution Date.
(c) In the event that any withholding tax is imposed on the
Trust's payment (or allocations of income) to a Certificateholder, such tax
shall reduce the amount otherwise distributable to the Certificateholder in
accordance with this Section. The Eligible Lender Trustee is hereby authorized
and directed to retain from amounts otherwise distributable to the
Certificateholders sufficient funds for the payment of any tax that is legally
owed by the Trust (and such authorization shall not prevent the Eligible Lender
Trustee from contesting any such tax in appropriate proceedings, and withholding
payment of such tax, if permitted by law, pending the outcome of such
proceedings). The amount of any withholding tax imposed with respect to a
Certificateholder shall be treated as cash distributed to such Certificateholder
at the time it is withheld by the Trust to be remitted to the appropriate taxing
authority. If there is a possibility that withholding tax is payable with
respect to a distribution (such as a distribution to a non-U.S.
Certificateholder), the Eligible Lender Trustee in its sole discretion may (but
unless otherwise required by law shall not be obligated to) withhold such
amounts in accordance with this paragraph (c). In the event that a
Certificateholder wishes to apply for a refund of any such withholding tax, the
Eligible Lender Trustee shall reasonably cooperate with such Certificateholder
in making such claim so long as such Certificateholder agrees to reimburse the
Eligible Lender Trustee for any out-of-pocket expenses incurred.
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SECTION 5.02. Method of Payment. Subject to Section 9.01(c),
distributions required to be made to Certificateholders on any Interest Payment
Date or Distribution Date shall be made to each Certificateholder of record on
the preceding Record Date either by wire transfer, in immediately available
funds, to the account of such Certificateholder at a bank or other entity having
appropriate facilities therefor, if such Certificateholder shall have provided
to the Certificate Registrar appropriate written instructions signed by two
authorized officers, if any, at least five Business Days prior to such Interest
Payment Date or Distribution Date and such Certificateholder's Trust
Certificates in the aggregate evidence a denomination of not less than
$1,000,000, or, if not, by check mailed to such Certificateholder at the address
of such Certificateholder appearing in the Certificate Register; provided,
however, that, unless Definitive Certificates have been issued pursuant to
Section 3.13, with respect to Trust Certificates registered on the Record Date
in the name of the nominee of the Clearing Agency (initially, such nominee to be
Cede & Co.), distributions will be made by wire transfer in immediately
available funds to the account designated by such nominee. Notwithstanding the
foregoing, the final distribution in respect of any Trust Certificate (whether
on the Final Maturity Date or otherwise) will be payable only upon presentation
and surrender of such Trust Certificate at the Corporate Trust Office of the
Eligible Lender Trustee or such other location specified in writing to the
Certificateholder thereof.
SECTION 5.03. No Segregation of Moneys; No Interest. Subject
to Section 5.01, moneys received by the Eligible Lender Trustee hereunder need
not be segregated in any manner except to the extent required by law or the
Basic Documents and may be deposited under such general conditions as may be
prescribed by law, and the Eligible Lender Trustee shall not be liable for any
interest thereon.
SECTION 5.04. Accounting and Reports to the Noteholders,
Certificateholders, the Internal Revenue Service and Others. The Eligible Lender
Trustee shall (a) maintain (or cause to be maintained) the books of the Trust on
a calendar year basis on the accrual method of accounting, (b) prepare and
deliver to each Certificateholder (and to each Person who was a
Certificateholder at any time during the applicable calendar year), as may be
required by the Code and applicable Treasury Regulations, such information as
may be required (including Schedule K-1) to enable each such Certificateholder
to prepare its Federal and state income tax returns, (c) prepare and file such
tax returns relating to the Trust (including a partnership information return,
Internal Revenue Service Form 1065), and make such elections as may from time to
time be required or
17
appropriate under any applicable state or Federal statute or rule or regulation
thereunder so as to maintain the Trust's characterization as a partnership for
Federal income tax purposes, (d) cause such tax returns to be signed in the
manner required by law and (e) collect or cause to be collected any withholding
tax as described in and in accordance with Section 5.01(c) with respect to
income or distributions to Certificateholders. The Eligible Lender Trustee shall
elect under Section 1278 of the Code to include in income currently any market
discount that accrues with respect to the Financed Student Loans. The Eligible
Lender Trustee shall not make the election provided under Section 754 of the
Code.
SECTION 5.05. Signature on Returns; Tax Matters Partner. (a)
The Company shall sign on behalf of the Trust the tax returns of the Trust.
(b) The Company shall be designated the "tax matters partner"
of the Trust pursuant to Section 6231(a)(7)(A) of the Code and applicable
Treasury Regulations.
SECTION 5.06. Check-The-Box Proposal. If Treasury Regulations
ss. 301.7701-1 through ss. 301.7701-3 are amended such that the Trust would not
be classified as an association taxable as a corporation if the requirements of
Sections 2.07(a), 2.11, 3.10 and 9.02 hereof (collectively, the "Partnership
Qualification Provisions") were no longer applicable and the Trust made any
necessary elections to avoid classification as an association taxable as a
corporation required by such regulations (such an amendment, a "Tax
Characterization Amendment"), the Partnership Qualification Provisions shall no
longer be applicable or part of this Agreement; provided, however, that the
Partnership Qualification Provisions shall no longer be applicable or part of
this Agreement only if the Eligible Lender Trustee first obtains an Opinion of
Counsel stating that (i) a Tax Characterization Amendment has been adopted and
(ii) the deletion of the Partnership Qualification Provisions will not cause the
Trust to be subject to an entity level tax for state or federal income tax
purposes. To the extent the Tax Characterization Amendment requires the Trust to
affirmatively elect to be treated as a partnership, the Depositor, the
Certificateholders and the Eligible Lender Trustee at the discretion and expense
of the Depositor, shall take all actions necessary under such regulations for
the Trust to be treated as a partnership for federal income tax purposes.
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ARTICLE VI
Authority and Duties of Eligible Lender Trustee
SECTION 6.01. General Authority. The Eligible Lender Trustee
is authorized and directed to execute and deliver the Basic Documents to which
the Trust is to be a party and each certificate or other document attached as an
exhibit to or contemplated by the Basic Documents to which the Trust is to be a
party, in each case, in such form as the Depositor shall approve as evidenced
conclusively by the Eligible Lender Trustee's execution thereof, and, on behalf
of the Trust, to direct the Indenture Trustee to authenticate and deliver Class
A-1 Notes in the aggregate principal amount of $252,000,000 and Class A-2 Notes
in the aggregate principal amount of $161,439,000. The Eligible Lender Trustee
is also authorized and directed on behalf of the Trust (i) to acquire and hold
legal title to the Financed Student Loans from the Depositor and (ii) to take
all actions required pursuant to Section 3.02(c) of the Master Servicing
Agreement, and otherwise follow the direction of and cooperate with the Master
Servicer in submitting, pursuing and collecting any claims to and with the
Department with respect to any Interest Subsidy Payments and Special Allowance
Payments relating to the Financed Student Loans.
In addition to the foregoing, the Eligible Lender Trustee is
authorized, but shall not be obligated, to take all actions required of the
Trust pursuant to the Basic Documents. The Eligible Lender Trustee is further
authorized from time to time to take such action as the Administrator directs or
instructs with respect to the Basic Documents and is directed to take such
action to the extent that the Administrator is expressly required pursuant to
the Basic Documents to cause the Eligible Lender Trustee to act.
SECTION 6.02. General Duties. It shall be the duty of the
Eligible Lender Trustee to discharge (or cause to be discharged) all its
responsibilities pursuant to the terms of this Agreement and the other Basic
Documents to which the Trust is a party and to administer the Trust in the
interest of the Certificateholders, subject to and in accordance with the
provisions of this Agreement and the other Basic Documents. Without limiting the
foregoing, the Eligible Lender Trustee shall on behalf of the Trust file and
prove any claim or claims that may exist on behalf of the Trust against the
Depositor in connection with any claims paying procedure as part of an
insolvency or a receivership proceeding involving the Depositor. Notwithstanding
the foregoing, the Eligible Lender Trustee shall be deemed to have discharged
its duties and responsibilities hereunder and under the other Basic Documents to
the extent the
19
Administrator has agreed in the Administration Agreement to perform any act or
to discharge any duty of the Eligible Lender Trustee hereunder or under any
other Basic Document, and the Eligible Lender Trustee shall not be held liable
for the default or failure of the Administrator to carry out its obligations
under the Administration Agreement. Except as expressly provided in the Basic
Documents, the Eligible Lender Trustee shall have no obligation to administer,
service or collect the Financed Student Loans or to maintain, monitor or
otherwise supervise the administration, servicing or collection of the Financed
Student Loans.
SECTION 6.03. Action upon Instruction. (a) Subject to Article
IV, Section 7.01 and in accordance with the terms of the Basic Documents, the
Certificateholders may by written instruction direct the Eligible Lender Trustee
in the management of the Trust. Such direction may be exercised at any time by
written instruction of the Certificateholders pursuant to Article IV.
(b) The Eligible Lender Trustee shall not be required to take
any action hereunder or under any other Basic Document if the Eligible Lender
Trustee shall have reasonably determined, or shall have been advised by counsel,
that such action is likely to result in liability on the part of the Eligible
Lender Trustee or is contrary to the terms hereof or of any other Basic Document
or is otherwise contrary to law.
(c) Whenever the Eligible Lender Trustee is unable to
determine the appropriate course of action between alternative courses of action
permitted or required by the terms of this Agreement or under any other Basic
Document, the Eligible Lender Trustee shall promptly give notice (in such form
as shall be appropriate under the circumstances) to the Certificateholders
requesting instruction as to the course of action to be adopted, and to the
extent the Eligible Lender Trustee acts in good faith in accordance with any
written instruction of the Certificateholders received, the Eligible Lender
Trustee shall not be liable on account of such action to any Person. If the
Eligible Lender Trustee shall not have received appropriate instruction within
10 days of such notice (or within such shorter period of time as reasonably may
be specified in such notice or may be necessary under the circumstances) it may,
but shall be under no duty to, take or refrain from taking such action, not
inconsistent with this Agreement or the other Basic Documents, as it shall deem
to be in the best interests of the Certificateholders, and shall have no
liability to any Person for such action or inaction.
(d) In the event that the Eligible Lender Trustee is unsure
as to the application of any provision of this Agreement
20
or any other Basic Document or any such provision is ambiguous as to its
application, or is, or appears to be, in conflict with any other applicable
provision, or in the event that this Agreement permits any determination by the
Eligible Lender Trustee or is silent or is incomplete as to the course of action
that the Eligible Lender Trustee is required to take with respect to a
particular set of facts, the Eligible Lender Trustee may give notice (in such
form as shall be appropriate under the circumstances) to the Certificateholders
requesting instruction and, to the extent that the Eligible Lender Trustee acts
or refrains from acting in good faith in accordance with any such instruction
received, the Eligible Lender Trustee shall not be liable, on account of such
action or inaction, to any Person. If the Eligible Lender Trustee shall not have
received appropriate instruction within 10 days of such notice (or within such
shorter period of time as reasonably may be specified in such notice or may be
necessary under the circumstances) it may, but shall be under no duty to, take
or refrain from taking such action, not inconsistent with this Agreement or the
other Basic Documents, as it shall deem to be in the best interests of the
Certificateholders, and shall have no liability to any Person for such action
or inaction.
SECTION 6.04. No Duties Except as Specified in this Agreement,
the Loan Sale Agreement, the Master Servicing Agreement, the Administration
Agreement or in Instructions. The Eligible Lender Trustee shall not have any
duty or obligation to manage, make any payment with respect to, register,
record, sell, service, dispose of or otherwise deal with the Trust Estate, or to
otherwise take or refrain from taking any action under, or in connection with,
any document contemplated hereby to which the Eligible Lender Trustee is a
party, except as expressly provided by the terms of this Agreement, the Loan
Sale Agreement, the Master Servicing Agreement, the Administration Agreement or
in any document or written instruction received by the Eligible Lender Trustee
pursuant to Section 6.03; and no implied duties or obligations shall be read
into this Agreement or any other Basic Document against the Eligible Lender
Trustee. The Eligible Lender Trustee shall have no responsibility for filing any
financing or continuation statement in any public office at any time or to
otherwise perfect or maintain the perfection of any security interest or lien
granted to it hereunder or to prepare or file any Commission filing for the
Trust or to record this Agreement or any other Basic Document. The Eligible
Lender Trustee nevertheless agrees that it will, at its own cost and expense,
promptly take all action as may be necessary to discharge any liens on any part
of the Trust Estate that result from actions by, or claims against, The First
National Bank of Chicago in its individual capacity or as the Eligible Lender
21
Trustee that are not related to the ownership or the administration of the Trust
Estate.
SECTION 6.05. No Action Except Under Specified Documents or
Instructions. The Eligible Lender Trustee shall not manage, control, use, sell,
service, dispose of or otherwise deal with any part of the Trust Estate except
(i) in accordance with the powers granted to and the authority conferred upon
the Eligible Lender Trustee pursuant to this Agreement, (ii) in accordance with
the other Basic Documents to which it is a party and (iii) in accordance with
any document or instruction delivered to the Eligible Lender Trustee pursuant to
Section 6.03.
SECTION 6.06. Restrictions. The Eligible Lender Trustee shall
not take any action (a) that is inconsistent with the purposes of the Trust set
forth in Section 2.03 or (b) that, to the actual knowledge of the Eligible
Lender Trustee, would result in the Trust's becoming taxable as a corporation
for Federal income tax purposes. The Certificateholders shall not direct the
Eligible Lender Trustee to take action that would violate the provisions of this
Section.
ARTICLE VII
Concerning the Eligible Lender Trustee
SECTION 7.01. Acceptance of Trusts and Duties. The Eligible
Lender Trustee accepts the trusts hereby created and agrees to perform its
duties hereunder with respect to such trusts but only upon the terms of this
Agreement. The Eligible Lender Trustee also agrees to disburse all moneys
actually received by it constituting part of the Trust Estate upon the terms of
this Agreement and the other Basic Documents. The Eligible Lender Trustee shall
not be answerable or accountable hereunder or under any other Basic Document
under any circumstances, except (i) for its own willful misconduct, bad faith or
negligence or (ii) in the case of the inaccuracy of any representation or
warranty contained in Section 7.03 expressly made by the Eligible Lender
Trustee. In particular, but not by way of limitation (and subject to the
exceptions set forth in the preceding sentence):
(a) the Eligible Lender Trustee shall not be liable for any
error of judgment made by a responsible officer of the Eligible Lender
Trustee;
(b) the Eligible Lender Trustee shall not be liable with
respect to any action taken or omitted to be taken by
22
it in accordance with the direction or instructions of the
Administrator or any Certificateholder;
(c) no provision of this Agreement or any other Basic Document
shall require the Eligible Lender Trustee to expend or risk funds or
otherwise incur any financial liability in the performance of any of
its rights or powers hereunder or under any other Basic Document, if
the Eligible Lender Trustee shall have reasonable grounds for believing
that repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured or provided to it;
(d) under no circumstances shall the Eligible Lender Trustee
be liable for indebtedness evidenced by or arising under any of the
Basic Documents, including the principal of and interest on the Notes;
(e) the Eligible Lender Trustee shall not be responsible for
or in respect of the validity or sufficiency of this Agreement or for
the due execution hereof by the Depositor or for the form, character,
genuineness, sufficiency, value or validity of any of the Trust Estate
or for or in respect of the validity or sufficiency of the Basic
Documents, other than the certificate of authentication on the Trust
Certificates, and the Eligible Lender Trustee shall in no event assume
or incur any liability, duty, or obligation to any Noteholder or to any
Certificateholder, other than as expressly provided for herein and in
the other Basic Documents;
(f) the Eligible Lender Trustee shall not be liable for the
action or inaction, default or misconduct of the Administrator, the
Seller, the Depositor, the Indenture Trustee or the Master Servicer
under any of the other Basic Documents or otherwise and the Eligible
Lender Trustee shall have no obligation or liability to perform the
obligations of the Trust under this Agreement or the other Basic
Documents that are required to be performed by the Administrator under
the Administration Agreement, the Indenture Trustee under the Indenture
or the Master Servicer under the Master Servicing Agreement; and
(g) the Eligible Lender Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this Agreement,
or to institute, conduct or defend any litigation under this Agreement
or otherwise or in relation to this Agreement or any other Basic
Document, at the request, order or direction of any of the Certificate-
holders, unless such Certificateholders have offered to the
23
Eligible Lender Trustee security or indemnity satisfactory to it
against the costs, expenses and liabilities that may be incurred by the
Eligible Lender Trustee therein or thereby. The right of the Eligible
Lender Trustee to perform any discretionary act enumerated in this
Agreement or in any other Basic Document shall not be construed as a
duty, and the Eligible Lender Trustee shall not be answerable for other
than its negligence, bad faith or willful misconduct in the performance
of any such act.
SECTION 7.02. Furnishing of Documents. The Eligible Lender
Trustee shall furnish to the Certificateholders promptly upon receipt of a
written request therefor, duplicates or copies of all reports, notices,
requests, demands, certificates, financial statements and any other instruments
furnished to the Eligible Lender Trustee under the Basic Documents.
SECTION 7.03. Representations and Warranties. The Eligible
Lender Trustee hereby represents and warrants to the Depositor, for the benefit
of the Certificateholders, that:
(a) It is a national banking association duly organized and
validly existing in good standing under the laws of the United States.
It has all requisite corporate power and authority to execute, deliver
and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this Agreement
will be executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement on its behalf.
(c) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will contravene any Federal or state law, governmental rule or
regulation governing the banking or trust powers of the 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.
(d) It 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 Financed Student Loans as contemplated by this
Agreement and the other Basic Documents, has obtained a lender
identification number with
24
respect to the Trust from the Department and has in effect a Guarantee
Agreement with each of the Guarantors with respect to the Financed
Student Loans.
SECTION 7.04. Reliance; Advice of Counsel. (a) The Eligible
Lender Trustee shall incur no liability to anyone in acting upon any signature,
instrument, direction, notice, resolution, request, consent, order, certificate,
report, opinion, bond, or other document or paper believed by it to be genuine
and believed by it to be signed by the proper party or parties. The Eligible
Lender Trustee may accept a certified copy of a resolution of the board of
directors or other governing body of any corporate party as conclusive evidence
that such resolution has been duly adopted by such body and that the same is in
full force and effect. As to any fact or matter the method of the determination
of which is not specifically prescribed herein, the Eligible Lender Trustee may
for all purposes hereof rely on a certificate, signed by the president or any
vice president or by the treasurer or other authorized officers of the relevant
party, as to such fact or matter and such certificate shall constitute full
protection to the Eligible Lender Trustee for any action taken or omitted to be
taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder
and in the performance of its duties and obligations under this Agreement or the
other Basic Documents, the Eligible Lender Trustee (i) may act directly or
through its agents or attorneys pursuant to agreements entered into with any of
them, and the Eligible Lender Trustee shall not be liable for the conduct or
misconduct of such agents or attorneys if such agents or attorneys shall have
been selected by the Eligible Lender Trustee with reasonable care, and (ii) may
consult with counsel, accountants and other skilled persons to be selected with
reasonable care and employed by it. The Eligible Lender Trustee shall not be
liable for anything done, suffered or omitted in good faith by it in accordance
with the written opinion or advice of any such counsel, accountants or other
such persons and not contrary to this Agreement or any other Basic Document.
SECTION 7.05. Not Acting in Individual Capacity. Except as
provided in this Article VII, in accepting the trusts hereby created, The First
National Bank of Chicago acts solely as Eligible Lender Trustee hereunder and
not in its individual capacity and all Persons having any claim against the
Eligible Lender Trustee by reason of the transactions contemplated by this
Agreement or any other Basic Document shall look only to the Trust Estate for
payment or satisfaction thereof.
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SECTION 7.06. Eligible Lender Trustee Not Liable for Trust
Certificates or Student Loans. The recitals contained herein and in the Trust
Certificates (other than the signature and countersignature of the Eligible
Lender Trustee on the Trust Certificates and its representations and warranties
in Section 7.03) shall be taken as the statements of the Depositor, and the
Eligible Lender Trustee assumes no responsibility for the correctness thereof.
The Eligible Lender Trustee makes no representations as to the validity or
sufficiency of this Agreement, the Trust Certificates or any other Basic
Document (other than the signature and countersignature of the Eligible Lender
Trustee on the Trust Certificates) or the Notes, or of any Financed Student Loan
or related documents. The Eligible Lender Trustee shall at no time have any
responsibility (or liability except for willfully, negligently or in bad faith
terminating or allowing to be terminated any of the Guarantee Agreements, in a
case where the Eligible Lender Trustee knows of any facts or circumstances which
will or could reasonably be expected to result in any such termination) for or
with respect to the legality, validity, enforceability and eligibility for
Guarantee Payments, Interest Subsidy Payments or Special Allowance Payments, as
applicable, of any Financed Student Loan, or for or with respect to the
sufficiency of the Trust Estate or its ability to generate the payments to be
distributed to Certificateholders under this Agreement or the Noteholders under
the Indenture, including: the existence and contents of any computer or other
record of any Financed Student Loan; the validity of the assignment of any
Financed Student Loan to the Trust; the completeness of any Financed Student
Loan; the performance or enforcement (except as expressly set forth in any Basic
Document) of any Financed Student Loan; the compliance by the Depositor or the
Master Servicer with any warranty or representation made under any Basic
Document or in any related document or the accuracy of any such warranty or
representation or any action or inaction of the Administrator, the Indenture
Trustee or the Master Servicer or any Subservicer taken in the name of the
Eligible Lender Trustee.
SECTION 7.07. Eligible Lender Trustee May Own Trust
Certificates and Notes. The Eligible Lender Trustee in its individual or any
other capacity may become the owner or pledgee of Trust Certificates or Notes
and may deal with the Depositor, the Administrator, the Indenture Trustee, the
Master Servicer and any Subservicer in banking transactions with the same rights
as it would have if it were not Eligible Lender Trustee.
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ARTICLE VIII
Compensation of Eligible Lender Trustee
SECTION 8.01. Eligible Lender Trustee's Fees and Expenses. The
Eligible Lender Trustee shall receive as compensation for its services hereunder
such fees as have been separately agreed upon before the date hereof between the
Depositor and the Eligible Lender Trustee, and the Eligible Lender Trustee shall
be entitled to be reimbursed by the Depositor for its other reasonable expenses
hereunder, including the reasonable compensation, expenses and disbursements of
such agents, representatives, experts and counsel as the Eligible Lender Trustee
may employ in connection with the exercise and performance of its rights and
duties hereunder. The Eligible Lender Trustee shall have no recourse to the
Issuer for its fees and expenses hereunder.
SECTION 8.02. Payments to the Eligible Lender Trustee. Any
amounts paid to the Eligible Lender Trustee pursuant to Section 8.01 hereof or
pursuant to Section 4.03 of the Loan Sale Agreement or pursuant to Section 24 of
the Administration Agreement shall be deemed not to be a part of the Trust
Estate immediately after such payment.
ARTICLE IX
Termination of Trust Agreement
SECTION 9.01. Termination of Trust Agreement. (a) This
Agreement (other than Article VIII) shall terminate and be of no further force
or effect and the Trust shall dissolve upon the earlier of (i) the final
distribution by the Eligible Lender Trustee of all moneys or other property or
proceeds of the Trust Estate in accordance with the terms of the Indenture, the
Master Servicing Agreement and Article V, (ii) the expiration of 21 years from
the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, the late
Ambassador of the United States to the Court of St. James's, living on the date
hereof, and (iii) the time provided in Section 9.02. The bankruptcy,
liquidation, dissolution, death or incapacity of any Certificateholder, other
than the Company as described in Section 9.02, shall not (x) operate to
terminate this Agreement or the Trust, nor (y) entitle such Certificateholder's
legal representatives or heirs to claim an accounting or to take any action or
proceeding in any court for a partition or winding up of all or any part of the
Trust or Trust Estate nor (z) otherwise affect the rights, obligations and
liabilities of the parties hereto.
27
(b) Except as provided in Section 9.01(a), neither the
Depositor, the Company nor any Certificateholder shall be entitled to revoke or
terminate the Trust.
(c) Notice of any termination of the Trust, specifying the
Distribution Date upon which the Certificateholders shall surrender their Trust
Certificates to the Certificate Paying Agent for payment of the final
distribution and cancellation, shall be given promptly by the Eligible Lender
Trustee by letter to Certificateholders mailed within five Business Days of
receipt of notice of such termination from the Administrator given pursuant to
Section 2(b)(vii) of the Administration Agreement, stating (i) the Distribution
Date upon which final payment of the Trust Certificates shall be made upon
presentation and surrender of the Trust Certificates at the office of the
Certificate Paying Agent therein designated, (ii) the amount of any such final
payment and (iii) that the Record Date otherwise applicable to such Distribution
Date is not applicable, payments being made only upon presentation and surrender
of the Trust Certificates at the office of the Certificate Paying Agent therein
specified. The Eligible Lender Trustee shall give such notice to the Certificate
Registrar (if other than the Eligible Lender Trustee) and the Certificate Paying
Agent at the time such notice is given to Certificateholders. Upon presentation
and surrender of the Trust Certificates, the Certificate Paying Agent shall
cause to be distributed to Certificateholders amounts distributable on such
Distribution Date pursuant to Section 5.01.
In the event that all the Certificateholders shall not
surrender their Trust Certificates for cancellation within six months after the
date specified in the above-mentioned written notice, the Eligible Lender
Trustee shall give a second written notice to the remaining Certificateholders
to surrender their Trust Certificates for cancellation and receive the final
distribution with respect thereto. If within one year after the second notice
all the Trust Certificates shall not have been surrendered for cancellation, the
Eligible Lender Trustee may take appropriate steps, or may appoint an agent to
take appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Trust Certificates, and the cost thereof shall be paid out of
the funds and other assets that shall remain subject to this Agreement. Subject
to applicable escheat laws, any funds remaining in the Trust after exhaustion of
such remedies and no later than five years after the first such notice shall be
distributed by the Eligible Lender Trustee to the Depositor. Thereafter,
Certificateholders shall look solely to the Depositor as general unsecured
creditors for payment.
28
(d) Upon the winding up of the Trust and after satisfaction of
all obligations of the Trust, the Eligible Lender Trustee shall cause the
Certificate of Trust to be canceled by filing a certificate of cancellation with
the Secretary of State of the State of Delaware in accordance with the
provisions of Section 3810 of the Business Trust Statute and the Trust shall
terminate.
SECTION 9.02. Dissolution upon Bankruptcy of the Company. In
the event that an Insolvency Event shall occur with respect to the Company, this
Agreement shall be terminated in accordance with Section 9.01 and the Trust
shall dissolve 90 days after the date of such Insolvency Event, unless, before
the end of such 90-day period, the Eligible Lender Trustee shall have received
written instructions from (a) Certificateholders (other than the Company)
representing more than 50% of the Certificate Balance (not including the
principal amount of Trust Certificates held by the Company), (b) Noteholders of
Class A-1 Notes representing more than 50% of the Outstanding Amount of the
Class A-1 Notes and (c) Noteholders of Class A-2 Notes representing more than
50% of the Outstanding Amount of the Class A-2 Notes, to the effect that each
such party disapproves of the liquidation of the Financed Student Loans and
termination of the Trust, in which event the Trust shall continue in accordance
with the Basic Documents. Promptly after the occurrence of any Insolvency Event
with respect to the Company, (i) the Company shall give the Indenture Trustee,
the Eligible Lender Trustee and the Rating Agencies written notice of such
Insolvency Event, (ii) the Eligible Lender Trustee shall, upon the receipt of
such written notice from the Company, give prompt written notice to the
Certificateholders and the Indenture Trustee, of the occurrence of such event
and (iii) the Indenture Trustee shall, upon receipt of written notice of such
Insolvency Event from the Eligible Lender Trustee or the Company, give prompt
written notice to the Noteholders of the occurrence of such event; provided,
however, that any failure to give a notice required by this sentence shall not
prevent or delay, in any manner, a termination of the Trust pursuant to the
first sentence of this Section 9.02. Upon a termination pursuant to this
Section, the Eligible Lender Trustee shall direct the Indenture Trustee promptly
to sell the assets of the Trust (other than the Trust Accounts) in a
commercially reasonable manner and on commercially reasonable terms. The
proceeds of such a sale of the assets of the Trust shall be treated as
collections under the Master Servicing Agreement and the Administration
Agreement.
29
ARTICLE X
Successor Eligible Lender Trustees and
Additional Eligible Lender Trustees
SECTION 10.01. Eligibility Requirements for Eligible Lender
Trustee. The Eligible Lender Trustee shall at all times be a corporation or
association (i) qualifying as 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 Financed Student Loans, with a valid lender identification number with
respect to the Trust from the Department; (ii) being authorized to exercise
corporate trust powers and hold legal title to the Financed Student Loans; (iii)
having in effect Guarantee Agreements with each of the Guarantors; (iv) having a
combined capital and surplus of at least $50,000,000 and being subject to
supervision or examination by Federal or state authorities; and (v) having (or
having a parent which has) a rating of at least BBB by Standard & Poor's, Baa3
by ▇▇▇▇▇'▇ and BBB- by Fitch, if rated by Fitch. If the Eligible Lender Trustee
shall publish reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purpose of this Section, the combined capital and surplus of the Eligible Lender
Trustee shall be deemed to be its combined capital and surplus as set forth in
its most recent report of condition so published. In case at any time the
Eligible Lender Trustee shall cease to be eligible in accordance with the
provisions of this Section, the Eligible Lender Trustee shall resign immediately
in the manner and with the effect specified in Section 10.02. In addition, at
all times the Trustee or a co-trustee shall be a Person that satisfies the
requirements of Section 3807(a) of the Business Trust Statute (the "Delaware
Trustee").
SECTION 10.02. Resignation or Removal of Eligible Lender
Trustee. The Eligible Lender Trustee may at any time resign and be discharged
from the trusts hereby created by giving written notice thereof to the
Administrator. Upon receiving such notice of resignation, the Administrator
shall promptly appoint a successor Eligible Lender Trustee meeting the
eligibility requirements of Section 10.01 by written instrument, in duplicate,
one copy of which instrument shall be delivered to the resigning Eligible Lender
Trustee and one copy to the successor Eligible Lender Trustee. If no successor
Eligible Lender Trustee shall have been so appointed and have accepted
appointment within 30 days after the giving of such notice of resignation, the
resigning Eligible Lender Trustee may petition any court of competent
jurisdiction for the appointment of a successor Eligible Lender Trustee;
provided, however, that such right to appoint or to petition for the appointment
of any such successor
30
shall in no event relieve the resigning Eligible Lender Trustee from any
obligations otherwise imposed on it under the Basic Documents until such
successor has in fact assumed such appointment.
If at any time the Eligible Lender Trustee shall cease to be
eligible in accordance with the provisions of Section 10.01 and shall fail to
resign after written request therefor by the Administrator, or if at any time
the Eligible Lender Trustee shall be legally unable to act, or an Insolvency
Event with respect to the Eligible Lender Trustee shall have occurred and be
continuing, then the Administrator may remove the Eligible Lender Trustee. If
the Administrator shall remove the Eligible Lender Trustee under the authority
of the immediately preceding sentence, the Administrator shall promptly appoint
a successor Eligible Lender Trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the outgoing Eligible Lender
Trustee so removed and one copy to the successor Eligible Lender Trustee and
payment of all fees owed to the outgoing Eligible Lender Trustee.
Any resignation or removal of the Eligible Lender Trustee and
appointment of a successor Eligible Lender Trustee pursuant to any of the
provisions of this Section shall not become effective until acceptance of
appointment by the successor Eligible Lender Trustee pursuant to Section 10.03
and payment of all fees and expenses owed to the outgoing Eligible Lender
Trustee. The Administrator shall provide notice of such resignation or removal
of the Eligible Lender Trustee and to each of the Rating Agencies.
SECTION 10.03. Successor Eligible Lender Trustee. Any
successor Eligible Lender Trustee appointed pursuant to Section 10.02 shall
execute, acknowledge and deliver to the Administrator and to its predecessor
Eligible Lender Trustee an instrument accepting such appointment under this
Agreement, and thereupon the resignation or removal of the predecessor Eligible
Lender Trustee shall become effective and such successor Eligible Lender
Trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties and obligations of its predecessor under
this Agreement, with like effect as if originally named as Eligible Lender
Trustee. The predecessor Eligible Lender Trustee shall upon payment of its fees
and expenses deliver to the successor Eligible Lender Trustee all documents,
statements, moneys and properties held by it under this Agreement and shall
assign, if permissible, to the successor Eligible Lender Trustee the lender
identification number obtained from the Department on behalf of the Trust; and
the Administrator and the predecessor Eligible Lender Trustee shall execute and
deliver such instruments and do such other
31
things as may reasonably be required for fully and certainly vesting and
confirming in the successor Eligible Lender Trustee all such rights, powers,
duties and obligations.
No successor Eligible Lender Trustee shall accept appointment
as provided in this Section unless at the time of such acceptance such successor
Eligible Lender Trustee shall be eligible pursuant to Section 10.01.
Upon acceptance of appointment by a successor Eligible Lender
Trustee pursuant to this Section, the Administrator shall mail notice of the
successor of such Eligible Lender Trustee to all Certificateholders, the
Indenture Trustee, the Noteholders and the Rating Agencies. If the Administrator
shall fail to mail such notice within 10 days after acceptance of appointment by
the successor Eligible Lender Trustee, the successor Eligible Lender Trustee
shall cause such notice to be mailed at the expense of the Administrator.
SECTION 10.04. Merger or Consolidation of Eligible Lender
Trustee. Any corporation into which the Eligible Lender Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Eligible Lender
Trustee shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Eligible Lender Trustee, shall, without
the execution or filing of any instrument or any further act on the part of any
of the parties hereto, anything herein to the contrary notwithstanding, be the
successor of the Eligible Lender Trustee hereunder; provided that such
corporation shall be eligible pursuant to Section 10.01; provided further that
the Eligible Lender Trustee shall mail notice of such merger or consolidation to
the Rating Agencies not less than 10 Business Days prior to the closing date of
such merger or consolidation.
SECTION 10.05. Appointment of Co-Eligible Lender Trustee or
Separate Eligible Lender Trustee. Notwithstanding any other provisions of this
Agreement, at any time, for the purpose of meeting any legal requirements of any
jurisdiction in which any part of the Trust may at the time be located, the
Administrator and the Eligible Lender Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Eligible Lender Trustee, which, except in the case of
any Delaware Trustee, shall meet the eligibility requirements of clauses (i)
through (iii) of Section 10.01, to act as co-trustee, jointly with the Eligible
Lender Trustee, or separate trustee or separate trustees, of all or any part of
the Trust Estate, and to vest in such Person, in such capacity, such title to
the Trust
32
Estate, or any part thereof, and, subject to the other provisions of this
Section, such powers, duties, obligations, rights and trusts as the
Administrator and the Eligible Lender Trustee may consider necessary or
desirable. If the Administrator shall not have joined in such appointment within
15 days after the receipt by it of a request so to do, the Eligible Lender
Trustee alone shall have the power to make such appointment. Pursuant to the
Co-Trustee Agreement, dated as of November 1, 1996, between The First National
Bank of Chicago and First Chicago Delaware Inc., the Eligible Lender Trustee
shall appoint First Chicago Delaware Inc. as a co-trustee hereunder for the
purpose of his acting as Delaware Trustee and such agreement is hereby
incorporated herein by reference. The Delaware Trustee is appointed to serve as
the trustee of the Trust in the State of Delaware for the sole purpose of
satisfying the requirement of Section 3807 of the Business Trust Statute that
the Trust have at least one trustee with a principal place of business in
Delaware. It is understood and agreed by the parties hereto and the
Certificateholders that the Delaware Trustee shall have none of the duties or
liabilities of the Eligible Lender Trustee. The duties of the Delaware Trustee
shall be limited to (a) accepting legal process served on the Trust in the State
of Delaware and (b) the execution of any certificates required to be filed with
the Delaware Secretary of State which the Delaware Trustee is required to
execute under Section 3811 of the Business Trust Statute. To the extent that, at
law or in equity, the Delaware Trustee has duties (including fiduciary duties)
and liabilities relating thereto to the Trust or the Certificateholders, it is
hereby understood and agreed by the other parties hereto and the
Certificateholders that such duties and liabilities are replaced by the duties
and liabilities of the Delaware Trustee expressly set forth in this Agreement.
If the Delaware Trustee shall die, become incapable of acting, resign or be
removed, unless the Eligible Lender Trustee is qualified to act as Delaware
Trustee, a successor co-trustee shall promptly be appointed in the manner
specified in this Section 10.05 to act as Delaware Trustee. No co-trustee or
separate trustee under this Agreement shall be required to meet the terms of
eligibility as a successor trustee pursuant to clauses (iv) and (v) of Section
10.01 and no notice of the appointment of any co-trustee or separate trustee
shall be required pursuant to Section 10.03.
Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties, and obligations conferred or
imposed upon the Eligible Lender Trustee shall be conferred upon and
exercised or performed by the Eligible Lender Trustee and such separate
trustee or co-trustee
33
jointly (it being understood that such separate trustee or co-trustee
is not authorized to act separately without the Eligible Lender Trustee
joining in such act), except to the extent that under any law of any
jurisdiction in which any particular act or acts are to be performed,
the Eligible Lender Trustee shall be incompetent or unqualified to
perform such act or acts, in which event such rights, powers, duties,
and obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised and
performed singly by such separate trustee or co-trustee, solely at the
direction of the Eligible Lender Trustee;
(ii) no trustee under this Agreement shall be personally liable by
reason of any act or omission of any other trustee under this
Agreement; and
(iii) the Administrator and the Eligible Lender Trustee acting
jointly may at any time accept the resignation of or remove any
separate trustee or co-trustee.
Any notice, request or other writing given to the Eligible
Lender Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to this
Agreement and the conditions of this Article. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Eligible Lender Trustee or separately, as may be provided
therein, subject to all the provisions of this Agreement, specifically including
every provision of this Agreement relating to the conduct of, affecting the
liability of, or affording protection to, the Eligible Lender Trustee. Each such
instrument shall be filed with the Eligible Lender Trustee and a copy thereof
given to the Administrator.
Any separate trustee or co-trustee may at any time appoint the
Eligible Lender Trustee as its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Eligible Lender Trustee, to the extent permitted by law,
without the appointment of a new or successor trustee, except as otherwise
provided in this Section 10.05 in regard to the Delaware Trustee.
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ARTICLE XI
Miscellaneous
SECTION 11.01. Supplements and Amendments. This Agreement may
be amended by the Depositor, the Company and the Eligible Lender Trustee, with
prior written notice to the Rating Agencies, without the consent of any of the
Noteholders or the Certificateholders, 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 or
the Certificateholders or in connection with a merger or consolidation of the
Depositor or a transfer of properties or assets of the Depositor in a
transaction permitted under the Basic Documents; provided, however, that such
action shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder or Certificateholder.
This Agreement may also be amended from time to time by the
Depositor, the Company and the Eligible Lender Trustee, with prior written
notice to the Rating Agencies, (i) with the consent of the Noteholders of Notes
evidencing not less than a majority of the Outstanding Amount of the Notes and
(ii) the Certificateholders of Certificates evidencing not less than 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 this Agreement 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 timing of,
collections of payments on Financed Student 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 required to consent to any such amendment, without
the consent of all the outstanding Noteholders and Certificateholders.
The Eligible Lender Trustee shall furnish 10 Business Days'
prior written notification of the substance of any such amendment or consent to
each Certificateholder, the Indenture Trustee and each of the Rating Agencies.
It shall not be necessary for the consent of
Certificateholders, the Noteholders or the Indenture Trustee pursuant to this
Section to approve the particular form of any proposed amendment or consent, but
it shall be sufficient if such
35
consent shall approve the substance thereof. The manner of obtaining such
consents (and any other consents of Certificateholders provided for in this
Agreement or in any other Basic Document) and of evidencing the authorization of
the execution thereof by Certificateholders shall be subject to such reasonable
requirements as the Eligible Lender Trustee may prescribe.
Promptly after the execution of any amendment to the
Certificate of Trust, the Eligible Lender Trustee shall cause the filing of such
amendment with the Secretary of State of the State of Delaware. The Eligible
Lender Trustee shall furnish the Rating Agencies with 10 Business Days' prior
written notice of any amendment to the Certificate of Trust.
Prior to the execution of any amendment to this Agreement, the
Eligible Lender Trustee shall be entitled to receive and rely upon an Opinion of
Counsel stating that the execution of such amendment is authorized or permitted
by this Agreement. The Eligible Lender Trustee may, but shall not be obligated
to, enter into any such amendment which affects the Eligible Lender Trustee's
own rights, duties or immunities under this Agreement or otherwise.
SECTION 11.02. No Legal Title to Trust Estate in
Certificateholders. The Certificateholders shall not have legal title to any
part of the Trust Estate. The Certificateholders shall be entitled to receive
distributions with respect to their undivided beneficial ownership interest
therein only in accordance with Articles V and IX. No transfer, by operation of
law or otherwise, of any right, title, or interest of the Certificateholders to
and in their beneficial ownership interest in the Trust Estate shall operate to
terminate this Agreement or the trusts hereunder or entitle any transferee to an
accounting or to the transfer to it of legal title to any part of the Trust
Estate.
SECTION 11.03. Limitations on Rights of Others. Except for
Section 2.07, the provisions of this Agreement are solely for the benefit of the
Eligible Lender Trustee, the Depositor, the Company, the Certificateholders, the
Administrator and, to the extent expressly provided herein, the Indenture
Trustee and the Noteholders, and nothing in this Agreement (other than Section
2.07), whether 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.
36
SECTION 11.04. Notices. (a) Unless otherwise expressly
specified or permitted by the terms hereof, all notices shall be in writing (or
in the form of facsimile notice, followed by written notice) and shall be deemed
given upon receipt by the intended recipient of three Business Days after
mailing if mailed by certified mail, postage prepaid (except that notice to the
Eligible Lender Trustee shall be deemed given only upon actual receipt by the
Eligible Lender Trustee), if to the Eligible Lender Trustee, addressed to its
Corporate Trust Office; if to the Depositor, addressed to Signet Bank, ▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Treasurer, telephone: (804)
▇▇▇-▇▇▇▇; facsimile: (▇▇▇) ▇▇▇-▇▇▇▇; if to the Company, addressed to Signet
Student Loan Corporation, ▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
Attention: President, telephone: (▇▇▇) ▇▇▇-▇▇▇▇, with a copy to Signet Bank, ▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ or, as to each party, at such other
address as shall be designated by such party in a written notice to each other
party.
(b) Any notice required or permitted to be given to a
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Certificateholder as shown in the Certificate Register. Any
notice so mailed within the time prescribed in this Agreement shall be
conclusively presumed to have been duly given, whether or not the
Certificateholder receives such notice.
SECTION 11.05. 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 11.06. 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 11.07. Successors and Assigns. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
the Depositor, the Company, the Eligible Lender Trustee and their respective
successors and each Certificateholder and its successors and permitted assigns,
all as herein provided. Any request, notice, direction, consent, waiver or other
instrument or action by a Certificateholder shall bind the successors and
assigns of such Certificateholder.
37
SECTION 11.08. No Petition. (a) The Depositor will not at any
time institute against the Trust or the Company any bankruptcy proceedings under
any United States Federal or state bankruptcy or similar law in connection with
any obligations relating to the Trust Certificates, the Notes, this Agreement or
any of the other Basic Documents.
(b) The Eligible Lender Trustee, by entering into this
Agreement, each Certificateholder, by accepting a Trust Certificate, and the
Indenture Trustee and each Noteholder by accepting the benefits of this
Agreement, hereby covenant and agree that they will not at any time institute
against the Depositor, the Company or the Trust, or join in any institution
against the Depositor, the Company or the Trust of, any bankruptcy,
reorganization, arrangement, insolvency, receivership or liquidation
proceedings, or other proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Trust Certificates, the Notes, this Agreement or any of the other Basic
Documents.
SECTION 11.09. No Recourse. Each Certificateholder by
accepting a Trust Certificate acknowledges that such Certificateholder's Trust
Certificates represent beneficial interests in the Trust only and do not
represent interests in or obligations of the Seller, the Master Servicer, any
Subservicer, the Depositor, the Company, the Administrator, the Eligible Lender
Trustee, the Indenture Trustee or any Affiliate thereof or any officer, director
or employee of any thereof and no recourse may be had against such parties or
their assets, except as may be expressly set forth or contemplated in this
Agreement, the Trust Certificates or the other Basic Documents.
SECTION 11.10. 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 11.11. Governing Law. This Agreement shall be
construed in accordance with the laws of the State of Delaware, 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.
38
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers hereunto duly
authorized, as of the day and year first above written.
THE FIRST NATIONAL BANK OF CHICAGO,
as Eligible Lender Trustee,
by /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Assistant Vice President
SIGNET BANK,
Depositor,
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: SR. VICE PRESIDENT
SIGNET STUDENT LOAN CORPORATION
by /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
----------------------------
Name:▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: SR. VICE PRESIDENT
39
EXHIBIT A
TO THE TRUST AGREEMENT
[FORM OF TRUST CERTIFICATE]
SEE REVERSE FOR CERTAIN DEFINITIONS
Unless this Trust Certificate is presented by an authorized
representative of The Depository Trust Company, a New York Corporation ("DTC"),
to the Issuer (as defined below) or its agent for registration of transfer,
exchange or payment, and any certificate issued is registered in the name of
Cede & Co. or in such other name as is requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as
the registered owner hereof, Cede & Co., has an interest herein.
THIS TRUST CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A
BENEFIT PLAN (AS DEFINED BELOW). THIS TRUST CERTIFICATE IS NOT GUARANTEED OR
INSURED BY ANY GOVERNMENTAL AGENCY.
[THIS TRUST CERTIFICATE IS NONTRANSFERABLE EXCEPT IN ACCORDANCE WITH
SECTION 3.10 OF THE TRUST AGREEMENT.](1)
NUMBER
R- $_________________________
CUSIP NO. 82668P AC9
SIGNET STUDENT LOAN TRUST 1996-A
FLOATING RATE ASSET BACKED CERTIFICATE
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of student loans sold to
the Trust by Signet Bank.
(This Trust Certificate does not represent an interest in or obligation
of Signet Bank, the Company (as defined below), the Master Servicer,
the Eligible Lender Trustee (as defined
_______________________
(1) To be included only on the Trust Certificates representing the
1% minimum required to be retained by the Company and any Trust
Certificates issued in exchange therefor.
below) or any of their respective affiliates, except to the extent
described below.)
THIS CERTIFIES THAT is the
registered owner of dollars non-assessable,
fully-paid, fractional undivided interest in the Signet Student Loan Trust
1996-A (the "Trust"), a trust formed under the laws of the State of Delaware by
Signet Bank, a Virginia banking corporation (the "Depositor"). The Trust was
created pursuant to a Trust Agreement dated as of November 1, 1996 (the "Trust
Agreement"), among the Depositor, Signet Student Loan Corporation, a Virginia
corporation (the "Company"), and The First National Bank of Chicago, a national
banking association, not in its individual capacity but solely as eligible
lender trustee on behalf of the Trust (the "Eligible Lender Trustee"), a summary
of certain of the pertinent provisions of which is set forth below. To the
extent not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in Appendix A to the Administration Agreement (the
"Administration Agreement") dated as of November 1, 1996, among the Trust,
Signet Bank, as Administrator and The Bank of New York, as Indenture Trustee;
such Appendix A also contains rules as to usage that shall be applicable herein.
This Certificate is one of the duly authorized Certificates
designated as "Floating Rate Asset Backed Certificates" (herein called the
"Trust Certificates") issued under the Indenture dated as of November 1, 1996,
between the Trust and The Bank of New York, a New York banking corporation, as
Indenture Trustee, are two classes of Notes designated as "Floating Rate Class
A-1 Asset Backed Notes" and "Floating Rate Class A-2 Asset Backed Notes"
(collectively, the "Notes"). This Trust Certificate is issued under and is
subject to the terms, provisions and conditions of the Trust Agreement, to which
Trust Agreement the holder of this Trust Certificate by virtue of the acceptance
hereof assents and by which such holder is bound. The property of the Trust
includes a pool of student loans (the "Financed Student Loans"), all moneys
received thereunder after the Cutoff Date, certain bank accounts and the
proceeds thereof and certain other rights under the Trust Agreement, the Loan
Sale Agreement and the Master Servicing Agreement and all proceeds of the
foregoing. The rights of the holders of the Trust Certificates to the assets of
the Trust are subordinated to the rights of the holders of the Notes, as set
forth in the Administration Agreement.
Under the Trust Agreement, there will be distributed on the
twenty-fifth day of each month, or if such twenty-fifth day is not a Business
Day, the next succeeding Business Day (each an "Interest Payment Date" and each
Interest Payment Date in each
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January, April, July and October also a "Distribution Date"), commencing on
January 27, 1997, to the person in whose name this Trust Certificate is
registered at the close of business on the twenty-fourth day of the calendar
month in which such Interest Payment Date or Distribution Date occurs (the
"Record Date") such Certificateholder's fractional undivided interest in the
amount to be distributed to Certificateholders on such Interest Payment Date or
Distribution Date pursuant to the Administration Agreement.
Each holder of this Trust Certificate acknowledges and agrees
that its rights to receive distributions in respect of this Trust Certificate
from Monthly Available Funds, Available Funds and amounts on deposit in the
Reserve Account are subordinated to the rights of the Noteholders as described
in the Administration Agreement and the Indenture.
It is the intent of the Seller, the Master Servicer, the
Depositor, the Company, the Administrator, the Certificateholders and the
Certificate Owners that, for purposes of Federal income, state and local income
and franchise and any other income taxes, the Trust will be treated as a
partnership and the Certificateholders (including each of the Depositor and the
Company in its capacity as recipient of distributions from the Reserve Account)
will be treated as partners in that partnership. The Company and the other
Certificateholders by acceptance of a Trust Certificate (and the Certificate
Owners by acceptance of a beneficial interest in a Trust Certificate), agree to
treat, and to take no action inconsistent with the treatment of, the Trust
Certificates for such tax purposes as partnership interests in the Trust.
Each Certificateholder or Certificate Owner, by its acceptance
of a Trust Certificate or, in the case of a Certificate Owner, a beneficial
interest in a Trust Certificate, covenants and agrees that such
Certificateholder or Certificate Owner, as the case may be, will not at any time
institute against the Depositor, the Company or the Trust, or join in any
institution against the Depositor, the Company or the Trust of, any bankruptcy,
reorganization, arrangement, insolvency, receivership or liquidation
proceedings, or other proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Trust Certificates, the Notes, the Trust Agreement or any of the other Basic
Documents.
Distributions on this Trust Certificate will be made as
provided in the Trust Agreement by the Eligible Lender Trustee by wire transfer
or by check mailed to the Certificateholder of record in the Certificate
Register without the presentation or
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surrender of this Trust Certificate or the making of any notation hereon, except
that with respect to Trust Certificates registered on the Record Date in the
name of the nominee of the Clearing Agency, unless Definitive Certificates have
been issued (initially, such nominee to be Cede & Co.), payments will be made by
wire transfer in immediately available funds to the account designated by such
nominee. Except as otherwise provided in the Trust Agreement and notwithstanding
the above, the final distribution on this Trust Certificate will be made after
due notice by the Eligible Lender Trustee of the pendency of such distribution
and only upon presentation and surrender of this Trust Certificate at the office
or agency maintained for the purpose by the Eligible Lender Trustee in the
Borough of Manhattan, The City of New York.
Reference is hereby made to the further provisions of this
Trust Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have
been executed by an authorized officer of the Eligible Lender Trustee or its
authenticating agent, by manual signature, this Trust Certificate shall not
entitle the holder hereof to any benefit under the Trust Agreement, the Loan
Sale Agreement, the Master Servicing Agreement or the Administration Agreement
or be valid for any purpose.
IN WITNESS WHEREOF, the Eligible Lender Trustee on behalf of
the Trust and not in its individual capacity has caused this Trust Certificate
to be duly executed as of the date set forth below.
SIGNET STUDENT LOAN TRUST 1996-A
by
THE FIRST NATIONAL BANK OF CHICAGO,
as Eligible Lender Trustee,
by
-------------------------------
Authorized Signatory
Date: [ ], ____
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TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned Trust
Agreement.
THE FIRST NATIONAL BANK OF CHICAGO,
as Eligible Lender Trustee,
by
-------------------------------
Authorized Signatory
OR
THE FIRST NATIONAL BANK OF CHICAGO,
as Eligible Lender Trustee,
by
FIRST CHICAGO TRUST COMPANY OF NEW
YORK, as Authenticating Agent,
by
------------------------------
Authorized Signatory
Date: [ ], ____
A-5
[Reverse of Trust Certificate]
The Trust Certificates do not represent an obligation of, or
an interest in, the Seller, the Master Servicer, the Depositor, the Company, the
Administrator, the Eligible Lender Trustee or any affiliates of any of them, and
no recourse may be had against such parties or their assets, except as may be
expressly set forth or contemplated herein, in the Trust Agreement or in the
other Basic Documents. In addition, this Trust Certificate is not guaranteed by
any governmental agency or instrumentality and is limited in right of payment to
certain collections with respect to the Financed Student Loans (and certain
other amounts), all as more specifically set forth in the Master Servicing
Agreement and the Administration Agreement. A copy of each of the Master
Servicing Agreement, the Administration Agreement, the Loan Sale Agreement and
the Trust Agreement may be examined during normal business hours at the
principal office of the Seller, and at such other places, if any, designated by
the Seller, by any Certificateholder upon request.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Depositor and the Company and the rights of the
Certificateholders under the Trust Agreement at any time by the Depositor, the
Company and the Eligible Lender Trustee with the consent of the holders of the
Notes and the Trust Certificates each voting as a class evidencing not less than
a majority of the outstanding principal balance of the Notes and the Certificate
Balance. Any such consent by the holder of this Trust Certificate shall be
conclusive and binding on such holder and on all future holders of this Trust
Certificate and of any Trust Certificate issued upon the transfer hereof or in
exchange herefor or in lieu hereof whether or not notation of such consent is
made upon this Trust Certificate. The Trust Agreement also permits the amendment
thereof, in certain limited circumstances, without the consent of the holders of
any of the Trust Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by The First
National Bank of Chicago in its capacity as Certificate Registrar, or by any
successor Certificate Registrar, in the Borough of Manhattan, The City of New
York, accompanied by a written instrument of transfer in form satisfactory to
the Eligible Lender Trustee and the Certificate Registrar duly executed by the
holder hereof or such holder's attorney duly authorized in writing, and
thereupon one or more new Trust Certificates of authorized denominations
A-6
evidencing the same aggregate interest in the Trust will be issued to the
designated transferee.
The Trust Certificates are issuable only as registered Trust
Certificates without coupons in denominations of $1,000 or in integral multiples
of $1,000 in excess thereof; provided, however, that the Trust Certificates
issued to the Company may be issued in such denominations as to include any
residual amount of the Certificate Balance. As provided in the Trust Agreement
and subject to certain limitations therein set forth, Trust Certificates are
exchangeable for new Trust Certificates of authorized denominations evidencing
the same aggregate denomination, as requested by the holder surrendering the
same. No service charge will be made for any such registration of transfer or
exchange, but the Eligible Lender Trustee or the Certificate Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
payable in connection therewith.
The Eligible Lender Trustee, the Certificate Registrar and any
agent of the Eligible Lender Trustee or the Certificate Registrar may treat the
person in whose name this Trust Certificate is registered as the owner hereof
for all purposes, and neither the Eligible Lender Trustee nor the Certificate
Registrar or any such agent shall be affected by any notice to the contrary.
The Trust Certificates (including any beneficial interests
therein) may not be acquired by or for the account of (i) an employee benefit
plan (as defined in Section 3(3) of ERISA) that is subject to the provisions of
Title I of ERISA, (ii) a plan described in Section 4975(e)(1) of the Internal
Revenue Code of 1986, as amended, or (iii) any entity whose underlying assets
include plan assets by reason of a plan's investment in the entity (a "Benefit
Plan"). By accepting and holding this Trust Certificate, the Holder and Owner
hereof shall be deemed to have represented and warranted that it is not a
Benefit Plan.
The obligations and responsibilities created by the Trust
Agreement and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Master Servicing Agreement and the disposition of all
property held as part of the Trust. The Seller may at its option purchase the
corpus of the Trust at a price specified in the Loan Sale Agreement, and such
purchase of the Financed Student Loans and other property of the Trust will
effect early retirement of the Trust Certificates; however, such right of
purchase is exercisable only as of any Distribution Date on or after the date
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on which the Pool Balance is less than or equal to 10% of the sum of the Initial
Pool Balance and the Initial Pre-Funded Amount as of the Closing Date. In
addition, the Financed Student Loans will be subject to auction on or after the
January 2007 Distribution Date as and to the extent provided in the Indenture,
and the proceeds of any such auction will be applied to effect early retirement
of the Notes and Trust Certificates. No assurance can be given as to whether the
Indenture Trustee will be successful in selling the Financed Student Loan in an
auction on the January 2007 Distribution Date or any subsequent Distribution
Date.
This Trust Certificate shall be construed in accordance with
the laws of the State of Delaware, 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.
A-8
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
________________________________________________________________________________
(Please print or type name and address, including postal zip
code, of assignee)
________________________________________________________________________________
the within Trust Certificate, and all rights thereunder, hereby
irrevocably constituting and appointing
______________________________________________________ Attorney to transfer
said Trust Certificate on the books of the Certificate Registrar, with full
power of substitution in the premises.
Dated:
______________________________*
Signature Guaranteed:
____________________________*
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Trust Certificate in every particular,
without alteration, enlargement or any change whatever. Such signature must be
guaranteed by a member firm of the New York Stock Exchange or a commercial bank
or trust company.
A-9
EXHIBIT B
TO THE TRUST AGREEMENT
Certificate Depository Agreement
EXHIBIT C
TO THE TRUST AGREEMENT
CERTIFICATE OF TRUST OF
SIGNET STUDENT LOAN TRUST 1996-A
THIS Certificate of Trust of Signet Student Loan Trust 1996-A
(the "Trust"), dated as of December 26, 1996, is being duly executed and filed
by The First National Bank of Chicago, a national banking association, and First
Chicago Delaware, Inc., an individual, as trustees, to form a business trust
under the Delaware Business Trust Act (12 Del. Code, ss. 3801 et seq.).
1. Name. The name of the business trust formed hereby is SIGNET
STUDENT LOAN TRUST 1996-A.
2. Delaware Trustee. The name and business address of the
trustee of the Trust resident in the State of Delaware is First Chicago
Delaware, Inc., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
3. This Certificate of Trust will be effective December 27,
1996.
4. This Certificate may be executed simultaneously in any number
of counterparts, each of which counterparts shall be deemed to be an original,
and all of which shall constitute but one and the same instrument.
IN WITNESS WHEREOF, the undersigned, being the sole trustees
of the Trust, have executed this Certificate of Trust as of the date first above
written.
THE FIRST NATIONAL BANK OF CHICAGO,
not in its individual capacity but
solely as trustee of the Trust.
By ________________________________
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President
FIRST CHICAGO DELAWARE, INC.,
not in its individual
capacity but solely as
co-trustee of the Trust.
By________________________________
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Vice President
__________________________________
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