Exhibit 4.2.2
-------------------------------------------------------------------------------
AMENDED AND RESTATED
TRUST AGREEMENT
between
SLM FUNDING CORPORATION,
as Depositor
and
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but solely
as Eligible Lender Trustee
Dated as of February 1, 2000
-------------------------------------------------------------------------------
TABLE OF CONTENTS
-----------------
PAGE
ARTICLE I
Section 1.1 Definitions and Usage....................................................1
ARTICLE II
SECTION 2.1 Creation of Trust; Name..................................................1
SECTION 2.2 Office...................................................................1
SECTION 2.3 Purposes and Powers......................................................1
SECTION 2.4 Appointment of Eligible Lender Trustee...................................2
SECTION 2.5 Initial Capital Contribution of Trust Estate.............................2
SECTION 2.6 Declaration of Trust.....................................................2
SECTION 2.7 Liability of the Certificateholders......................................3
SECTION 2.8 Title to Trust Property..................................................3
SECTION 2.9 Representations and Warranties of the Depositor..........................4
SECTION 2.10 Application of Trust Funds...............................................5
ARTICLE III
SECTION 3.1 Initial Beneficial Ownership.............................................7
SECTION 3.2 The Trust Certificates...................................................7
SECTION 3.3 Authentication of Trust Certificates.....................................7
SECTION 3.4 Registration of Transfer and Exchange
of Trust Certificates....................................................8
SECTION 3.5 Mutilated, Destroyed, Lost or Stolen Trust Certificates..................9
SECTION 3.6 Persons Deemed Owners...................................................10
SECTION 3.7 Access to List of Certificateholders' Names and Addresses...............10
SECTION 3.8 Maintenance of Office or Agency.........................................10
SECTION 3.9 Appointment of Certificate Paying Agent.................................11
SECTION 3.10 Book-Entry Certificates.................................................12
SECTION 3.11 Notices to Clearing Agency..............................................13
SECTION 3.12 Definitive Certificates.................................................13
i
PAGE
ARTICLE IV
SECTION 4.1 Prior Notice to Certificateholders
With Respect to Certain Matters.........................................14
SECTION 4.2 Action by Certificateholders with
Respect to Certain Matters..............................................15
SECTION 4.3 Action by Certificateholders with
Respect to Bankruptcy...................................................15
SECTION 4.4 Restrictions on Certificateholders'
Power...................................................................15
SECTION 4.5 Majority Control........................................................15
ARTICLE V
SECTION 5.1 Application of Trust Funds..............................................15
SECTION 5.2 Method of Payment.......................................................17
SECTION 5.3 No Segregation of Moneys; No Interest...................................17
SECTION 5.4 Accounting and Reports to the Note-
holders, Certificateholders, the
Internal Revenue Service and Others.....................................17
SECTION 5.5 Signature on Returns; Tax Matters
Partner.................................................................18
SECTION 5.6 Capital Accounts........................................................18
ARTICLE VI
SECTION 6.1 General Authority.......................................................19
SECTION 6.2 General Duties..........................................................20
SECTION 6.3 Action upon Instruction.................................................20
SECTION 6.4 No Duties Except as Specified in
this Agreement or in Instructions.......................................22
SECTION 6.5 No Action Except Under Specified
Documents or Instructions...............................................22
SECTION 6.6 Restrictions............................................................22
ARTICLE VII
SECTION 7.1 Acceptance of Trusts and Duties.........................................23
SECTION 7.2 Furnishing of Documents.................................................24
SECTION 7.3 Representations and Warranties..........................................25
SECTION 7.4 Reliance; Advice of Counsel.............................................25
SECTION 7.5 Not Acting in Individual Capacity.......................................26
SECTION 7.6 Eligible Lender Trustee Not Liable
for Trust Certificates or Trust Student Loans...........................26
SECTION 7.7 Eligible Lender Trustee May Own
Trust Certificates and Notes............................................27
ii
PAGE
ARTICLE VIII
SECTION 8.1 Eligible Lender Trustee's Fees and Expenses.............................27
SECTION 8.2 Payments to the Eligible Lender
Trustee.................................................................28
SECTION 8.3 Indemnity...............................................................28
ARTICLE IX
SECTION 9.1 Termination of Trust Agreement..........................................28
SECTION 9.2 Dissolution upon Insolvency of
the Depositor...........................................................29
ARTICLE X
SECTION 10.1 Eligibility Requirements for Eligible Lender Trustee....................30
SECTION 10.2 Resignation or Removal of Eligible
Lender Trustee..........................................................31
SECTION 10.3 Successor Eligible Lender Trustee.......................................32
SECTION 10.4 Merger or Consolidation of Eligible
Lender Trustee..........................................................33
SECTION 10.5 Appointment of Co-Eligible Lender
Trustee or Separate Eligible Lender
Trustee.................................................................33
ARTICLE XI
SECTION 11.1 Supplements and Amendments..............................................35
SECTION 11.2 No Legal Title to Trust Estate in
Certificateholders......................................................36
SECTION 11.3 Limitations on Rights of Others.........................................36
SECTION 11.4 Notices.................................................................36
SECTION 11.5 Severability............................................................37
SECTION 11.6 Separate Counterparts...................................................37
SECTION 11.7 Successors and Assigns..................................................37
SECTION 11.8 No Petition.............................................................37
SECTION 11.9 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
Annex 1 to Trust Agreement
iii
AMENDED AND RESTATED TRUST AGREEMENT dated as of February 1, 2000,
between SLM FUNDING CORPORATION, a Delaware corporation, as Depositor, and CHASE
MANHATTAN BANK DELAWARE, a Delaware banking corporation, not in its individual
capacity but solely as Eligible Lender Trustee.
WITNESSETH:
WHEREAS, the Depositor and the Eligible Lender Trustee are parties to
that certain Trust Agreement dated as of February 1, 2000 (the "Short-Form Trust
Agreement") pursuant to which the SLM Student Loan Trust 2000-1 was created; and
WHEREAS, the Depositor and the Eligible Lender Trustee desire to amend
and restate the Short-Form Trust Agreement as set forth below.
NOW THEREFORE, the Depositor and the Eligible Lender Trustee hereby
agree as follows:
ARTICLE I
SECTION 1.1 DEFINITIONS AND USAGE. Except as otherwise specified herein
or as the context may otherwise require, capitalized terms used but not
otherwise defined herein are defined in Appendix A hereto, which also contains
rules as to usage that shall be applicable herein.
ARTICLE II
ORGANIZATION
SECTION 2.1 CREATION OF TRUST; NAME. There is hereby created a Trust
which shall be known as "SLM Student Loan Trust 2000-1", in which name the
Eligible Lender Trustee may conduct the business of the Trust, make and execute
contracts and other instruments on behalf of the Trust and ▇▇▇ and be sued. The
Trust shall constitute a business trust within the meaning of Section 3801(a) of
the Delaware Business Trust Act for which the Trustee has filed a certificate of
trust with the Secretary of State of the State of Delaware pursuant to Section
3810(a) of the Delaware Business Trust Act.
SECTION 2.2 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 2.3 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 fund the Reserve Account pursuant to Section 2.8 of
the Administration Agreement and to purchase the Trust Student Loans
pursuant to the Sale Agreement;
(iii) to Grant the Trust Estate to the Indenture Trustee
pursuant to the Indenture, and to hold, manage and distribute to the
Certificateholders pursuant to the terms of this Agreement any portion
of the Trust Estate released from the Lien of, and remitted to the
Trust pursuant to, the Indenture;
(iv) to enter into and perform its obligations under the Basic
Documents to which it is to be a party;
(v) 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
including but not limited to entering into and performing its
obligations under any Swap Agreements to which it is to be a party; and
(vi) 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
2.7 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 2.4 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 the rights, powers and duties set forth herein.
SECTION 2.5 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
2
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 Trustee for any such expenses paid by the Eligible Lender Trustee.
SECTION 2.6 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 business trust
under Delaware law and that this Agreement constitute the governing instrument
of such trust. It is the intention of the parties hereto that, solely for income
tax purposes, the Trust shall be treated as a partnership, with the assets of
the partnership being the Trust Student Loans and other assets held by the
Trust, the partners of the partnership being the Certificateholders (including
the Depositor as recipient of 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, 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 with respect to accomplishing the
purposes of the Trust.
SECTION 2.7 LIABILITY OF THE CERTIFICATEHOLDERS.
(a) Notwithstanding the provisions of Section 3803 of the Delaware
Business Trust Act, the Depositor shall be liable directly to
and shall indemnify the injured party for all losses, claims,
damages, liabilities and expenses of the Trust (including
Expenses, to the extent that the assets of the Trust that
would remain if all of the Notes were paid in full would not
be sufficient to pay any such liabilities, or if such
liabilities in fact are not paid out of the Trust Estate) to
the extent that the Depositor would be liable if the Trust
were a partnership under the Delaware Revised Uniform Limited
Partnership Act in which the Depositor were a general partner;
PROVIDED, HOWEVER, that the Depositor shall not be liable for
any losses incurred by a beneficial owner of a Note in its
capacity as a holder of limited recourse debt or to any
Certificateholder. In addition, any third party creditors
of the Trust (other than in connection with the obligations
to Noteholders excepted above) shall be third party
beneficiaries of this paragraph.
3
(b) No Certificateholder shall have any personal liability for any
liability or obligation of the Trust.
SECTION 2.8 TITLE TO TRUST PROPERTY. Legal title to all of 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 Trust
Student Loans shall be vested at all times in the Eligible Lender Trustee on
behalf of the Trust.
SECTION 2.9 REPRESENTATIONS, WARRANTIES, AND COVENANTS OF THE
DEPOSITOR. The Depositor hereby represents, warrants and covenants to the
Eligible Lender Trustee as follows:
(a) The Depositor is duly organized and validly existing as a
Delaware corporation in good standing under the laws of the
State of Delaware, with 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 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.
(c) This Agreement constitutes a legal, valid and binding
obligation of the Depositor enforceable in accordance with its
terms, subject to applicable bankruptcy, insolvency,
reorganization and similar laws relating to creditors' rights
generally and subject to general principles of equity.
(d) 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 certificate of
incorporation or by-laws of the Depositor, or any indenture,
agreement or other instrument to which the Depositor is a
party or by which it is bound; nor result in the creation or
4
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 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.
(e) The Depositor agrees for the benefit of the Noteholders and of
the Certificateholders that it will comply with each of the
requirements set forth in Article IX, X, and XII of its
Certificate of Incorporation and with each of the undertakings
set forth in Annex I hereto.
SECTION 2.10 APPLICATION OF TRUST FUNDS.
(a) INCOME AND LOSS ALLOCATIONS. After giving effect to the
special allocations set forth in subparagraph (b) of this
Section 2.10 and for purposes of maintaining Capital Accounts
under Section 5.6, gross income items of the Trust for any
Accrual Period as determined for Federal income tax purposes
shall be allocated as follows:
(1) first, among the Certificateholders as of the
close of business on the last day of such Accrual
Period, in proportion to the Certificate Balance of
the Certificates owned by them on such date, an
amount of gross income up to the sum of (i) the
portion of the Certificateholders' Return
Distribution Amount and the Certificate Return
Carryover, if any, for the related Distribution Date
allocable to such Accrual Period, (ii) return on the
excess, if any, of the Certificateholders' Return
Distribution Amount for the preceding Distribution
Date over the amount in respect of return on the
Certificates that is actually distributed to
Certificateholders on such preceding Distribution
Date, to the extent permitted by law, at the
Certificate Rate for such Accrual Period and (iii)
the portion of the market discount on the Trust
Student Loans accrued during such Accrual Period that
is allocable to the excess, if any, of the initial
aggregate principal amount of the Certificates over
their initial aggregate issue price; and
(2) the balance of Profits, if any, to the Depositor.
5
If the items of gross income of the Trust for any month are
insufficient for the allocations described in clause (1)
above, subsequent items of gross income shall first be
allocated to make up such shortfall before Profits are
allocated as provided in clause (b). Loss of the Trust for any
Accrual Period shall be allocated to the Depositor to the
extent the Depositor is reasonably expected to bear the
economic burden of such Loss, and any remaining Loss shall be
allocated among the Certificateholders as of the close of
business on the last day of such Accrual Period in proportion
to the Certificate Balance of Trust Certificates owned by them
on such date. If any items of loss or deduction are allocated
to Certificateholders and the Depositor subsequently
determines that the economic loss to Certificateholders will
be less than was expected at the time such allocations were
made, additional items of gross income will be allocated to
Certificateholders in subsequent periods to offset the excess
allocations of losses and deductions to Certificateholders
before any Profits are allocated to the Depositor as provided
in clause (2) above.
(b) SPECIAL ALLOCATIONS.
(1) In the event any Certificateholder unexpectedly
receives any adjustments, allocations or
distributions described in Treasury Regulation
Section 1.704-1(b)(2)(ii)(d)(4), (5) or (6), items of
Trust income and gain shall be specially allocated to
such Certificateholder in an amount and manner
sufficient to eliminate, to the extent required by
the Treasury Regulations, the deficit, if any, in the
balance of the Capital Account of such
Certificateholder as quickly as possible. This
Section 2.10(b) is intended to comply with the
qualified income offset provision in Section
1.704-1(b)(2)(ii)(d) of the Treasury Regulations.
(2) In the event the initial issue price of
Certificates differs from their initial Certificate
Balance, there shall be specially allocated to the
Certificateholders the portion, if any, of the offset
for premium (in the case the issue price of the
Certificates exceeds the Certificate Balance) on the
Trust Student Loans accruing for a calendar month
that is attributable to such difference.
(c) LIQUIDATING PROFIT OR LOSS. Liquidating Profit or Loss shall
be allocated, after all other adjustments are made to the
Capital Accounts (including adjustments to reflect the
Liquidating Distribution), as follows:
6
(1) First, among the Certificateholders in proportion
to their ownership of the principal amount of
Certificates, in an amount that would cause their
Capital Account balances to equal zero (in the case
of the Depositor, taking into account the Capital
Account balance of the Depositor only to the extent
it relates to Certificates owned by the Depositor);
and
(2) Any balance, to the Depositor.
(d) TAX ALLOCATIONS. For Federal income tax purposes, each item of
income, gain, loss and deduction of the Trust shall be
allocated among the Certificateholders and the Depositor in
a manner consistent with the allocations set forth in this
Section 2.10, subject to the provisions of Section 704(c)
of the Code. Notwithstanding anything to the contrary set
forth in this Agreement, the Depositor is authorized to
modify the allocations of this Section 2.10(d) and Sections
2.10(a), (b) and (c) if necessary or appropriate, in the
Depositor's sole discretion, for the allocations to fairly
reflect the economic gain, income or loss to the Depositor
or the Certificateholders, or as otherwise required by the
Code or the Treasury Regulations.
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1 INITIAL BENEFICIAL OWNERSHIP. Upon the formation of the
Trust by the contribution by the Depositor pursuant to Section 2.5 and until the
issuance of the Trust Certificates, the Depositor shall be the sole beneficial
owner of the Trust.
SECTION 3.2 THE TRUST CERTIFICATES. The Trust Certificates shall be
issued in denominations of $100,000 or in integral multiples of $1,000 in excess
thereof. 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 were affixed, authorized
to sign on behalf of the Trust, shall be valid and binding obligations of the
Trust, 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.
7
SECTION 3.3 AUTHENTICATION OF TRUST CERTIFICATES. Concurrently with the
sale of the Trust Student Loans to the Trust pursuant to the Purchase 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 The Chase
Manhattan Bank, 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 3.4, 3.5
or 3.12 hereunder.
SECTION 3.4 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 Section 3.8, 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 Chase
Manhattan Bank 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 3.8, the Eligible Lender
Trustee shall execute, authenticate and deliver (or shall cause The Chase
Manhattan Bank 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 3.8.
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 a member firm of
8
the New York Stock Exchange or a commercial bank or trust company. Each Trust
Certificate surrendered for registration of transfer or exchange shall be
cancelled 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 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
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) employee benefit plans (as defined in
section 3(3) of ERISA) that are subject to the provisions of Title I of ERISA,
(b) plans described in section 4975(e)(1) of the Code, including individual
retirement accounts described in Section 408(a) of the Code or ▇▇▇▇▇ plans, or
(c) entities whose underlying assets include plan assets by reason of a plan's
investment in such entities (each, a "Benefit Plan"). By accepting and holding a
Trust Certificate or an interest therein, the Certificateholder thereof or
Certificate Owner thereof shall be deemed to have represented and warranted that
it is not a Benefit Plan, is not purchasing Trust Certificates on behalf of a
Benefit Plan and is not using assets of a Plan to purchase any Certificates and
to have agreed that if the Trust Certificate is deemed to be a plan asset, the
Certificateholder will promptly dispose of the Trust Certificate.
SECTION 3.5 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 and the Trust 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 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
9
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 3.6 PERSONS DEEMED OWNERS. Prior to due presentation of a Trust
Certificate for registration of transfer, the Eligible Lender Trustee and the
Certificate Registrar and any agent of either of them 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 5.1 and for all other purposes whatsoever, and
neither the Eligible Lender Trustee, the Certificate Registrar nor any agent
thereof shall be bound by any notice to the contrary.
SECTION 3.7 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 shall 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 3.8 MAINTENANCE OF OFFICE OR AGENCY. The Eligible Lender
Trustee shall maintain in the Borough of Brooklyn, 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
10
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: Structured Finance Services. 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 3.9 APPOINTMENT OF CERTIFICATE PAYING AGENT. The Certificate
Paying Agent shall make distributions to Certificateholders from the amounts
received from the Indenture Trustee out of the Trust Accounts pursuant to
Section 5.1 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. 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 the Eligible Lender Trustee, and
any co-paying agent chosen by the Eligible Lender Trustee and consented to by
the Administrator (which consent shall not be unreasonably withheld). The
co-paying agent shall initially be the Indenture Trustee. The Eligible Lender
Trustee shall be permitted to resign as Certificate Paying Agent upon 30 days'
written notice to the Eligible Lender Trustee. In the event that the Eligible
Lender 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 give
notice to the Rating Agencies of the appointment of a successor Certificate
Paying Agent. 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 Certificateholder
entitled thereto until such sums shall be paid to such Certificateholder. 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 7.1, 7.3, 7.4, 7.5 and 8.1 shall apply to
the Eligible Lender Trustee also in its role as Certificate Paying Agent, for so
long as the Eligible Lender Trustee shall act as
11
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.
12
SECTION 3.10 BOOK-ENTRY CERTIFICATES. The Trust Certificates, upon
original issuance, 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. Such Book-Entry Certificate or Book-Entry Certificates shall
initially be registered on the Certificate Register in the name of Cede & Co.,
the nominee of the initial Clearing Agency, and no Certificate Owner will
receive a Definitive Certificate representing such Certificate Owner's interest
in such Trust Certificate, except as provided in Section 3.12. Unless and until
definitive, fully registered Trust Certificates (the "Definitive Certificates")
have been issued to Certificate Owners pursuant to Section 3.12:
(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 3.12, the initial Clearing
Agency will make book-entry transfers among the Clearing Agency
Participants and receive and transmit distribution in respect of the
Certificate Balance and return on the Trust Certificates to such
Clearing Agency Participants; and
(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
13
Certificates and has delivered such instructions to the
Eligible Lender Trustee.
SECTION 3.11 NOTICES TO CLEARING AGENCY. Whenever a notice or other
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 3.12, 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 3.12 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, a Servicer
Default or an Administrator 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 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.
14
ARTICLE IV
ACTIONS BY ELIGIBLE LENDER TRUSTEE
SECTION 4.1 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 each
of 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 Trust 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 Trust Student Loans);
(b) the amendment of the Indenture by a supplemental indenture in
circumstances where the consent of any Noteholder is required;
(c) 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;
(d) the amendment, change or modification of the Administration
Agreement, except to cure any ambiguity 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;
(e) the amendment of any Swap Agreement in circumstances where the
consent of any Noteholder is required or in circumstances
where the consent of any Noteholder is not required but where
such amendment materially adversely affects the interest of
the Certificateholders; or
(f) the appointment pursuant to the Administration Agreement of a
successor Administrator, the appointment pursuant to the
Indenture of a successor Note Registrar, Paying Agent or
Indenture Trustee, or the
15
appointment pursuant to this Agreement of a successor
Certificate Registrar or successor Certificate Paying Agent,
or the consent to the assignment by the Administrator, the
Note Registrar, the Paying Agent, the Indenture Trustee, the
Certificate Registrar or the Certificate Paying Agent of its
obligations under the Administration Agreement, the Indenture
or this Agreement, as applicable.
SECTION 4.2 ACTION BY CERTIFICATEHOLDERS WITH RESPECT TO CERTAIN
MATTERS. The Eligible Lender Trustee shall not have the power, except upon the
written direction of the Certificateholders and except as expressly provided in
the Basic Documents, to sell the Trust Student Loans after the termination of
the Indenture.
SECTION 4.3 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 (other than the Depositor) 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 4.4 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 2.3 nor
shall the Eligible Lender Trustee be permitted to follow any such direction, if
given.
SECTION 4.5 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 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 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 5.1 APPLICATION OF TRUST FUNDS.
16
(a) On each Distribution Date, the Eligible Lender Trustee shall
distribute to Certificateholders (i) the Certificateholders'
Return Distribution Amount for such Distribution Date on a pro
rata basis according to amounts payable in respect of
Certificateholders' Return Distribution Amount, (ii) the
Certificate Balance Distribution Amount for such Distribution
Date, if any, on a pro rata basis according to amounts payable
in respect of the Certificate Balance, and (iii) the
Certificate Return Carryover for such Distribution Date, if
any, on a pro rata basis according to amounts payable in
respect of Certificate Return Carryover, as received from the
Indenture Trustee pursuant to Sections 2.7 and 2.8 of the
Administration Agreement on such 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 2.9 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 (but 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. The Eligible Lender Trustee shall withhold
or cause to be withheld at the maximum applicable rate
provided in section 1441, 1442 or 1446 of the Code with
respect to all distributions made to persons that are not
known to be U.S. Persons, within the meaning of the Code,
unless it is otherwise determined in the opinion of counsel.
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
17
Certificateholder agrees to reimburse the Eligible Lender
Trustee for any out-of-pocket expenses incurred.
SECTION 5.2 METHOD OF PAYMENT. Subject to Section 9.1(c), distributions
required to be made to Certificateholders on any 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 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 3.12, 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 Certificate Final Maturity Date or otherwise)
shall 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 5.3 NO SEGREGATION OF MONEYS; NO INTEREST. Subject to Section
5.1, moneys received by the Eligible Lender Trustee hereunder need not be
segregated in any manner except to the extent required by law or the
Administration Agreement 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 5.4 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) deliver (or cause
to be delivered) 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) file (or cause to
18
be filed) 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 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 5.1(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 Trust Student Loans. The Eligible Lender Trustee shall not make
the election provided under Section 754 of the Code. The Eligible Lender Trustee
shall be entitled to hire an independent accounting firm to perform the
functions described in this Section 5.4 the reasonable fees and expenses of
which shall be paid by the Depositor.
SECTION 5.5 SIGNATURE ON RETURNS; TAX MATTERS PARTNER.
(a) The Eligible Lender Trustee shall sign on behalf of the Trust
the tax returns of the Trust, unless applicable law requires a
Certificateholder to sign such documents, in which case such
documents shall be signed by the Depositor.
(b) The Depositor 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 5.6 CAPITAL ACCOUNTS. The Trust shall maintain accounts
("Capital Accounts") with respect to each Certificateholder (including the
Depositor) in accordance with the following provisions:
(a) Each Certificateholder's Capital Account shall be increased by
the Capital Contributions (as defined below) of such
Certificateholder, such Certificateholder's distributive share
of gross income (and any Liquidating Profits) and any items in
the nature of income or gain which are specially allocated to
such Certificateholder pursuant to Section 2.10(b) of this
Agreement.
(b) Each Certificateholder's Capital Account shall be reduced by
any amount distributed to such Certificateholder (including,
in the case of the Depositor, any amount released or otherwise
distributed
19
to the Depositor from the Reserve Account under Sections
2.8C(G) and 2.8D of the Administration Agreement) and such
Certificateholder's distributive share of Losses and
deductions (and any Liquidating Loss), including any special
allocation pursuant to Section 2.10(b).
(c) In the event all or a portion of a Certificate is transferred
in accordance with the terms of this Agreement, the transferee
shall succeed to the Capital Account of the transferor to the
extent it related to such Certificate or a portion thereof.
(d) Notwithstanding the above, the Capital Accounts shall be
adjusted in accordance with the provisions governing the
economic rights of the Certificateholders, as set forth herein
and in the Basic Documents.
"Capital Contribution" means the amount of any cash and the fair market
value of any property contributed to the Trust by a Certificateholder (including
any amounts deemed to be contributed in connection with the original issuance of
the Certificates), including, in the case of the Depositor, the fair market
value of the Trust Student Loans deemed to be contributed by the Depositor to
the Trust, taking into account the provisions of Section 707(a)(2)(B) of the
Code and the Regulations thereunder. The foregoing provisions and the other
provisions of this Agreement relating to the maintenance of Capital Accounts are
intended to comply with section 1.704-1(b) of the Treasury Regulations and shall
be interpreted in a manner consistent therewith.
ARTICLE VI
AUTHORITY AND DUTIES OF ELIGIBLE LENDER TRUSTEE
SECTION 6.1 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 Notes
in the aggregate principal amount of $1,976,950,000. The Eligible Lender Trustee
is also authorized and directed on behalf of the Trust (i) to acquire and hold
legal title to the Trust Student Loans from the Depositor and (ii) to take all
actions required pursuant to Section 3.2C of the Administration Agreement and
20
otherwise follow the direction of and cooperate with the 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
Trust Student Loans.
In addition to the foregoing, the Eligible Lender Trustee is authorized
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 6.2 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, 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, 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
Administrator has agreed in the Administration Agreement to perform and 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 Trust Student Loans or to maintain, monitor or otherwise
supervise the administration, servicing or collection of the Trust Student
Loans.
SECTION 6.3 ACTION UPON INSTRUCTION.
(a) [Reserved]
(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
21
liability on the part of the Eligible Lender Trustee or is
contrary to the terms hereof, 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
and actions 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 requiring 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, 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, 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
22
from taking such action, not inconsistent with this Agreement
or the other Basic Documents, as it shall deem to be in the
best interest of the Certificateholders, and shall have no
liability to any Person for such action or inaction.
SECTION 6.4 NO DUTIES EXCEPT AS SPECIFIED IN THIS 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 or in any document or written
instruction received by the Eligible Lender Trustee pursuant to Section 6.3; 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, Chase Manhattan Bank Delaware in its
individual capacity or as the Eligible Lender Trustee that are not related to
the ownership or the administration of the Trust Estate.
SECTION 6.5 NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR INSTRUCTIONS.
The Eligible Lender Trustee shall not 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 6.3.
SECTION 6.6 RESTRICTIONS. The Eligible Lender Trustee shall not take
any action (a) that is inconsistent with the purposes of the Trust set forth in
Section 2.3 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.
23
ARTICLE VII
CONCERNING THE ELIGIBLE LENDER TRUSTEE
--------------------------------------
SECTION 7.1 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 or negligence or (ii)
in the case of the inaccuracy of any representation or warranty contained in
Section 7.3 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 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
24
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
Depositor, the Indenture Trustee, the Servicer or Swap
Counterparty 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, the Servicer under the Servicing Agreement or the
Swap Counterparty under the Swap Agreements; 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, any other Basic Document, at the request, order or
direction of any of the Certificateholders, unless such
Certificateholders have offered to the 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, 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 or willful
misconduct in the performance of any such act.
SECTION 7.2 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. On each Distribution Date,
the Eligible Lender Trustee shall provide to each Certificateholder of record as
of the related Record Date the
25
information provided by the Administrator to the Eligible Lender Trustee on the
related Determination Date pursuant to Section 2.9 of the Administration
Agreement.
SECTION 7.3 REPRESENTATIONS AND WARRANTIES. The Eligible Lender Trustee
hereby represents and warrants to the Depositor, for the benefit of the
Certificateholders, that:
(a) It is duly organized and validly existing in good standing
under the laws of its governing jurisdiction and has an office
located within the State of Delaware. It has all requisite
corporate power and authority to execute, deliver and perform
its obligations under this 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 Delaware
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 and will maintain its status 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 Trust Student
Loans as contemplated by this Agreement and the other Basic
Documents, it has a lender identification number with respect
to the Trust Student Loans from the Department and has and
will maintain in effect a Guarantee Agreement with each of the
Guarantors with respect to the Trust Student Loans.
SECTION 7.4 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
26
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 and accountants 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 or accountants and not contrary to this
Agreement, any other Basic Document.
SECTION 7.5 NOT ACTING IN INDIVIDUAL CAPACITY. Except as provided in
this Article VII, in accepting the trusts hereby created Chase Manhattan Bank
Delaware 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, any other
Basic Document shall look only to the Trust Estate for payment or satisfaction
thereof.
SECTION 7.6 ELIGIBLE LENDER TRUSTEE NOT LIABLE FOR TRUST CERTIFICATES
OR TRUST STUDENT LOANS. The recitals contained herein and in the Trust
Certificates (other than the signature of and authentication by the Eligible
Lender Trustee on the Trust Certificates) shall be taken as the statements of
the Depositor
27
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 of and authentication by the Eligible Lender
Trustee on the Trust Certificates), or the Notes, or of any Trust Student Loan
or related documents. The Eligible Lender Trustee shall at no time have any
responsibility (or liability except for willfully or negligently 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,
federal reinsurance, Interest Subsidy Payments or Special Allowance Payments, as
applicable, in respect of any Trust 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 Trust Student Loan; the validity of the assignment of any Trust
Student Loan to the Eligible Lender Trustee on behalf of the Trust; the
completeness of any Trust Student Loan; the performance or enforcement (except
as expressly set forth in any Basic Document) of any Trust Student Loan; the
compliance by the Depositor or the 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 Servicer or any subservicer taken in the name of
the Eligible Lender Trustee.
SECTION 7.7 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 Servicer or the Swap
Counterparties in banking transactions with the same rights as it would have if
it were not Eligible Lender Trustee.
ARTICLE VIII
COMPENSATION AND INDEMNITY OF ELIGIBLE LENDER TRUSTEE
SECTION 8.1 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
28
to be reimbursed by the Depositor, to the extent provided in such separate
agreement, for its other reasonable expenses (including the reasonable fees and
expenses of counsel and independent accountants) hereunder.
SECTION 8.2 PAYMENTS TO THE ELIGIBLE LENDER TRUSTEE. Any amounts paid
to the Eligible Lender Trustee pursuant to Section 8.1 hereof or pursuant to
Section 9 of the Sale Agreement, Section 4.2 of the Administration Agreement or
Section 4.2 of the Servicing Agreement shall be deemed not to be a part of the
Trust Estate immediately after such payment.
SECTION 8.3 INDEMNITY. The Depositor shall cause the Administrator to
indemnify the Eligible Lender Trustee in its individual capacity and any of its
officer, directors, employees and agents as and to the extent provided for in
Section 4.2 of the Administration Agreement.
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1 TERMINATION OF TRUST AGREEMENT.
(a) This Agreement (other than Article VIII) and the Trust shall
terminate and be of no further force or effect 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 Administration Agreement and Article V, and (ii) the time
provided in Section 9.2. The bankruptcy, liquidation,
dissolution, death or incapacity of any Certificateholder,
other than the Depositor as described in Section 9.2, 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.
(b) Except as provided in Section 9.1(a), neither the Depositor
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
29
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 6.1C 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 5.1.
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. 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.
Upon final distribution of any funds remaining in the Trust, the
Eligible Lender Trustee shall file a certificate of cancellation of the Trust's
certificate of trust pursuant to Section 3810(c) of the Delaware Business Trust
Act.
SECTION 9.2 DISSOLUTION UPON INSOLVENCY OF THE DEPOSITOR.
Notwithstanding the provisions of Section 3808 of the Delaware
30
Business Trust Act, in the event that an Insolvency Event shall occur with
respect to the Depositor, (x) the Trust created hereunder shall dissolve and (y)
this Agreement shall be terminated in accordance with Section 9.1 90 days after
the date of such Insolvency Event. Promptly after the occurrence of any
Insolvency Event with respect to the Depositor, (i) the Depositor shall give the
Indenture Trustee, the Eligible Lender Trustee, any Swap Counterparty, and each
Rating Agency written notice of such Insolvency Event, and (ii) the Eligible
Lender Trustee shall, upon the receipt of such written notice from the
Depositor, give prompt written notice to the Certificateholders and the
Indenture Trustee, of the occurrence of such event and of the effect of such
event under this Section 9.2; 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 9.2.
Upon a termination of the Trust 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 Administration Agreement.
ARTICLE X
SUCCESSOR ELIGIBLE LENDER TRUSTEES AND
ADDITIONAL ELIGIBLE LENDER TRUSTEES
SECTION 10.1 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 Trust
Student Loans on behalf of the Trust, with a valid lender identification number
with respect to the Trust Student Loans from the Department; (ii) being
authorized to exercise corporate trust powers and hold legal title to the Trust
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;
(v) having its principal place of business in the State of Delaware and
otherwise complying with Section 3807 of the Delaware Business Trust Act; and
(vi) having (or having a parent which has) a rating in respect of its long-term
senior unsecured debt of at least BBB- (or the equivalent) by each of the Rating
Agencies (or which, if the long-term senior unsecured debt of such corporation
or association is not rated by any Rating Agency, shall have provided to the
Indenture Trustee
31
written confirmation from such Rating Agency that the appointment of such
corporation or association to serve as Eligible Lender Trustee will not result
in and of itself in a reduction or withdrawal of the then current rating of any
of the Notes or the Certificates). 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 10.2.
SECTION 10.2 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 10.1 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 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 or shall
be likely to cease to be eligible in accordance with the provisions of Section
10.1 and shall fail to resign after written request therefor by the
Administrator, or if at any time 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
32
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 10.3,
payment of all fees and expenses owed to the outgoing Eligible Lender Trustee
and the filing of a certificate of amendment to the Trust's certificate of trust
pursuant to Section 3810(b) of the Delaware Business Trust Act. The
Administrator shall provide notice of such resignation or removal of the
Eligible Lender Trustee and to each of the Rating Agencies.
SECTION 10.3 SUCCESSOR ELIGIBLE LENDER TRUSTEE. Any successor Eligible
Lender Trustee appointed pursuant to Section 10.2 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 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 such appointment as
provided in this Section unless at the time of such acceptance such successor
Eligible Lender Trustee shall be eligible pursuant to Section 10.1.
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, the Rating Agencies and the Swap Counterparties. If
the Administrator shall fail to mail such notice within 10 days after acceptance
of appointment by the successor Eligible Lender
33
Trustee, the successor Eligible Lender Trustee shall cause such notice to be
mailed at the expense of the Administrator.
SECTION 10.4 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 10.1; and PROVIDED FURTHER that the Eligible Lender
Trustee shall mail notice of such merger or consolidation to the Rating Agencies
not less than 15 days prior to the effective date thereof.
SECTION 10.5 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, meeting the eligibility
requirements of clauses (i) through (iii) of Section 10.1, 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 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.
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), (v)
and (vi) of Section 10.1 and no notice of the appointment of any co-trustee or
separate trustee shall be required pursuant to Section 10.3.
Each separate trustee and co-trustee shall, to the extent permitted by
law, be appointed and act subject to the following provisions and conditions:
34
(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 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.
35
ARTICLE XI
MISCELLANEOUS
-------------
SECTION 11.1 SUPPLEMENTS AND AMENDMENTS. This Agreement may be amended
by the Depositor and the Eligible Lender Trustee, with prior written notice to
the Rating Agencies, without the consent of any of the Noteholders, the
Certificateholders or the Swap Counterparties, 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 modifying in any manner the rights of the Noteholders, the
Certificateholders or the Swap Counterparties; 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, Certificateholder or any Swap
Counterparty.
This Agreement may also be amended from time to time by the Depositor
and the Eligible Lender Trustee, with prior written notice to the Rating
Agencies, with the consent of (i) 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 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
Trust 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.
This Agreement may also be amended from time to time by the Depositor
and the Eligible Lender Trustee, with prior written notice to the Rating
Agencies, with the consent of the affected Swap Counterparty for the purpose of
adding any provisions to, changing in any manner, or eliminating any of the
provisions of this Agreement or modifying in any manner the rights of a Swap
Counterparty if in the Opinion of Counsel such amendment materially adversely
affects the interests of such Swap Counterparty.
36
Promptly after the execution of any such amendment or consent, the
Eligible Lender Trustee shall furnish written notification of the substance of
such amendment or consent to each Certificateholder, the Indenture Trustee, the
Swap Counterparties and each of the Rating Agencies.
It shall not be necessary for the consent of Certificateholders, the
Noteholders, the Indenture Trustee or any Swap Counterparty pursuant to this
Section to approve the particular form of any proposed amendment or consent, but
it shall be sufficient if such consent shall approve the substance thereof. 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.
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 11.2 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 11.3 LIMITATIONS ON RIGHTS OF OTHERS. Except for Section 2.7,
the provisions of this Agreement are solely for the benefit of the Eligible
Lender Trustee, the Depositor, the Certificateholders, the Administrator and, to
the extent expressly provided herein, the Indenture Trustee, the Noteholders and
the Swap Counterparties, and nothing in this Agreement (other than Section 2.7),
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
37
Agreement or any covenants, conditions or provisions contained
herein.
SECTION 11.4 NOTICES.
(a) Unless otherwise expressly specified or permitted by the terms
hereof, all notices shall be in writing and shall be deemed
given upon receipt by the intended recipient or 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 SLM Funding Corporation, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇,
▇▇▇▇▇ ▇▇▇▇▇, 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 11.5 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 11.6 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 11.7 SUCCESSORS AND ASSIGNS. All covenants and agreements
contained herein shall be binding upon to the benefit of, the Depositor and its
successors, the Eligible Lender Trustee and its successors, 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.
38
SECTION 11.8 NO PETITION.
(a) The Depositor will not at any time institute against the Trust
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 (not in its individual capacity
but solely as 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 or the Trust, or join in any institution against the
Depositor 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 11.9 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 Depositor, the Servicer, the Administrator, the
Eligible Lender Trustee, the Indenture Trustee, any Swap Counterparty 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 governed by and
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.
39
IN WITNESS WHEREOF, the parties hereto have caused this Amended and
Restated Trust Agreement to be duly executed by their respective officers
hereunto duly authorized, as of the day and year first above written.
CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity
but solely as Eligible Lender
Trustee,
By /S/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
SLM FUNDING CORPORATION,
Depositor,
By /S/ J. ▇▇▇▇▇ ▇▇▇▇▇▇
----------------------
Name: J. ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Chief Financial Officer
40
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 CERTIFICATE IS NOT GUARANTEED OR INSURED
BY ANY GOVERNMENTAL AGENCY.
NUMBER $71,710,000
R-1 CUSIP NO. 78442 GBW 5
SLM STUDENT LOAN TRUST 2000-1
FLOATING RATE STUDENT LOAN-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 SLM Funding Corporation.
(This Trust Certificate does not represent an interest in or obligation
of SLM Funding Corporation, the Servicer (as defined below), the
Eligible Lender Trustee (as defined below) or any of their respective
affiliates, except to the extent described below.)
41
THIS CERTIFIES THAT Cede & Co. is the registered owner of $71,710,000
dollars non-assessable, fully-paid, fractional undivided interest in the SLM
Student Loan Trust 2000-1 (the "Trust"), a trust formed under the laws of the
State of Delaware by SLM Funding Corporation, a Delaware corporation (the
"Depositor"). The Trust was created pursuant to an Amended and Restated Trust
Agreement dated as of February 1, 2000 (the "Trust Agreement"), between the
Depositor and Chase Manhattan Bank Delaware, a Delaware banking corporation, 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 Trust Agreement.
This Certificate is one of the duly authorized Certificates designated
as "Floating Rate Student LoanBacked Certificates" (herein called the "Trust
Certificates"). 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 "Trust Student Loans"), all moneys paid
thereunder on or after January 17, 2000, certain bank accounts and the proceeds
thereof and certain other rights under the Trust Agreement, the Sale Agreement,
the Purchase Agreement, the Administration Agreement and the 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 issued under the Indenture dated as of February 1, 2000,
between the Trust and Bankers Trust Company, as Indenture Trustee, and
designated as "Floating Rate Student Loan-Backed Notes" (the "Notes"), as set
forth in the Trust Agreement, the Indenture and the Administration Agreement.
Under the Trust Agreement, to the extent of funds available therefor,
return on the Certificate Balance of this Trust Certificate at the Certificate
Rate (as defined below) will be distributed on the 25th day of
42
each January, April, July and October (or, if such 25th day is not a Business
Day, the next succeeding Business Day) (each a "Distribution Date"), commencing
on July 25, 2000, to the person in whose name this Trust Certificate is
registered as of the close of business on the day immediately preceding the
Distribution Date (such day the "Record Date"), in each case to the extent of
such Certificateholder's pro rata interest in the amount or amounts to be
distributed to Certificateholders on such Distribution Date pursuant to the
Administration Agreement.
The Certificate Rate for each Accrual Period shall be equal to
Three-Month LIBOR, except for the first Accrual Period, which shall be
Five-Month LIBOR, on the second business day before the beginning of that
Accrual Period plus 0.45% per annum.
Each holder of this Trust Certificate acknowledges and agrees that its
rights to receive distributions in respect of this Trust Certificate from
Available Funds and amounts on deposit in the Reserve Account are subordinated
to the rights of the Noteholders as described in the Trust Agreement, the
Indenture and the Administration Agreement.
It is the intent of the Depositor, the Certificateholders and the
Certificate Owners that, for purposes of Federal, state and local income and
franchise and any other income taxes, the Trust will be treated as a partnership
and the Certificateholders (including the Depositor in its capacity as
Certificateholder and as recipient of distributions from the Reserve Account)
will be treated as partners in that partnership. The Depositor 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
43
Certificateholder or Certificate Owner, as the case may be, will not at any time
institute against the Depositor or the Trust, or join in any institution against
the Depositor 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 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 or the
Administration Agreement or be valid for any purpose.
44
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.
SLM STUDENT LOAN TRUST 2000-1
by CHASE MANHATTAN BANK DELAWARE,
not in its individual capacity but
solely as Eligible Lender Trustee.
By:
------------------------------
Authorized Signatory
Date: February 15, 2000
45
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the within-mentioned Trust
Agreement.
CHASE MANHATTAN BANK DELAWARE, not
in its individual capacity but
solely as Eligible Lender Trustee,
By:
----------------------------
Authorized Signatory
OR
THE CHASE MANHATTAN BANK, solely in
its capacity as Authenticating Agent
for the Eligible Lender Trustee,
By:
----------------------------
Authenticating Agent
Date: February 15, 2000
46
[REVERSE OF TRUST CERTIFICATE]
The Trust Certificates do not represent an obligation of, or an
interest in, the Depositor, ▇▇▇▇▇▇ ▇▇▇ Servicing Corporation, as servicer (the
"Servicer"), Student Loan Marketing Association, as administrator (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 Trust Student Loans, all as more
specifically set forth in the Trust Agreement. A copy of each of the Trust
Agreement, the Sale Agreement, the Purchase Agreement, the Administration
Agreement, Servicing Agreement and the Indenture may be examined during normal
business hours at the principal office of the Administrator, and at such other
places, if any, designated by the Administrator, by any Certificateholder upon
request.
The Trust Agreement permits, with certain options therein provided, the
amendment thereof and the certification of the rights and obligations of the
Depositor and the rights of the Certificateholders under the Trust Agreement at
any time by the Depositor 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 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.
47
As provided in the Trust Agreement and subject to certain limitations
therein set forth, the transfer of the Trust Certificates is registerable in the
Certificate Register upon surrender of this Certificate for registration of
transfer at the offices or agencies maintained by Chase Manhattan Bank Delaware
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 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 $100,000 or in integral
multiples of $1,000 in excess thereof. 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 none of the Eligible Lender Trustee or 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 (the "Code"), including an individual retirement
48
account described in Section 408(a) of the Code or a ▇▇▇▇▇ plan or (iii) 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 this
Trust Certificate, the Holder hereof shall be deemed to have represented and
warranted that it is not a Benefit Plan, it is not purchasing this Trust
Certificate on behalf of a Benefit Plan, is not using assets of a Benefit Plan
to purchase this Trust Certificate and to have agreed that if this Trust
Certificate is deemed to be a plan asset, the Holder will promptly dispose of
this Trust Certificate.
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, the
Administration Agreement and the Indenture and the disposition of all property
held as part of the Trust. The Depositor may at its option purchase the corpus
of the Trust at a price specified in the Administration Agreement, and such
purchase of the Trust Student Loans and other property of the Trust will effect
early retirement of the Trust Certificates; however, such right of purchase is
exercisable only on any Distribution Date on or after the date on which the Pool
Balance is less than or equal to 10% of the Initial Pool Balance. Any Trust
Student Loans remaining in the Trust as of the end of the Collection Period
immediately preceding the Trust Auction Date will be offered for sale by the
Indenture Trustee by auction in accordance with the procedure described in the
Indenture.
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.
49
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.
50
EXHIBIT B
TO THE TRUST AGREEMENT
FORM OF CERTIFICATE DEPOSITORY AGREEMENT
----------------------------------------
ANNEX 1
TO THE AMENDED AND RESTATED TRUST AGREEMENT
DATED AS OF February 1, 2000
BETWEEN SLM FUNDING CORPORATION,
AS DEPOSITOR, AND
CHASE MANHATTAN BANK DELAWARE,
AS ELIGIBLE LENDER TRUSTEE
All defined terms are used herein as defined in the Trust Agreement
referred to above.
EXISTENCE. The Depositor will maintain its corporate existence and its
good standing under the laws of the State of Delaware.
PROCEDURES OBSERVED. The Depositor will observe all corporate
procedures required by its Certificate of Incorporation, its by-laws and the
corporation law of the State of Delaware.
MANAGEMENT. The business and affairs of the Depositor will be managed
by or under the direction of the Depositor's Board of Directors. The Depositor
will at all times ensure that its Board of Directors duly authorizes all
corporate actions requiring Board authorization. When necessary, the Depositor
will obtain proper authorization from its stockholder for corporate action. Its
stockholder will not be actively involved in the day-to-day management of the
Depositor except as contemplated by an arm's length management services
contract.
RECORDS. The Depositor will maintain separate corporate records and
books of account from those of its stockholder or any other affiliate of its
stockholder. The Depositor will keep correct and complete books and records of
account and minutes of the meetings and other proceedings of its stockholder and
Board of Directors. The resolutions, agreements and other instruments underlying
the transactions contemplated by the Trust Agreement will be continuously
maintained as official records by the Depositor.
OFFICES. The Depositor will have an address and telephone number
distinguishable from those of its stockholder. To the extent the Depositor's
office is located in the office of its stockholder or any affiliate of its
stockholder, the Depositor will pay fair market rent for any such office space
and a fair share of any material overhead costs.
1
IDENTIFIABLE ASSETS. Except in connection with the customary operation
of such cash management system as its stockholder may from time to time in the
ordinary course of business implement for itself and its consolidated
subsidiaries (which cash management system will be operated such that all
transfers of funds are properly documented and the respective assets and
liabilities of the Depositor and its stockholder are ascertainable at all
times), the Depositor's funds and other assets will be identifiable and will not
be commingled with those of its stockholder or any other entity. The Depositor
will maintain separate banking records and books of account from those of its
stockholder or any other affiliate of its stockholder.
CAPITALIZATION. The Depositor will not engage in any business for which
its capitalization would not be adequate.
EXPENSES. The Depositor will pay from its own funds and assets all
obligations and indebtedness incurred by it and will provide for its own
material operating expenses and liabilities from its own funds. General overhead
and administrative expenses of its stockholder will not be charged or otherwise
allocated to the Depositor (unless directly attributable to services provided to
or for the account of the Depositor) and such expenses of the Depositor which
are material will not be charged or otherwise allocated to its stockholder. Any
organizational expenses of the Depositor and expenses relating to the
preparation, negotiation, execution and delivery of the Transaction Documents
paid by its stockholder will be charged back to the Depositor. Such expenses
will be paid by the Depositor from amounts available to it as a result of the
capital contributions made by its stockholder, from the yield earned by it on
its Certificates, or from the retained portion of Deferred Payments made to it
under the Sale Agreement.
CONDUCT. The Depositor will conduct its business solely in its own name
so as not to mislead others as to the identity of the Depositor. Without
limiting the generality of the foregoing, all oral and written communications
related to the Depositor, including without limitation letters, invoices,
purchase orders, contracts, statements and applications, will be made solely in
the name of the Depositor except for items pursuant to the Facilities and
Services Agreement between the Depositor and its stockholder. The Depositor will
utilize its own separate stationery.
2
INTER-COMPANY CLAIMS. The Depositor will not enter into any guarantees
made by its stockholder with respect to obligations of the Depositor and the
Depositor will make no guarantees with respect to obligations of its
stockholder. There will be no inter-company debt or claims between the Depositor
and its stockholder other than (i) the obligation of the Depositor to pay to its
stockholder the Deferred Payment under the Purchase Agreement, (ii) the demand
note of its stockholder contributed to the Depositor as part of the Depositor's
capitalization, (iii) such inter-company claims as may arise in connection with
the management services contract referred to above, including a cash management
system for its stockholder and its consolidated subsidiaries as described above,
and (iv) such amounts as may temporarily be carried in inter-company accounts
relating to expenses incurred by its stockholder or its affiliates, to the
extent the Depositor is properly obligated to reimburse its stockholder or any
such affiliate for amounts allocable to the Depositor. The demand note referred
to above will be properly documented on the books and records of the Depositor.
RELIANCE BY OTHERS. The Depositor will act solely in its name and
through its duly authorized officers or agents in the conduct of its businesses.
The Depositor will not: (a) hold itself out as having agreed to pay or become
liable for the debts of its stockholder; (b) fail to correct any known
misrepresentation with respect to the foregoing; (c) operate or purport to
operate as an integrated, single economic unit with respect to its stockholder
or in its dealings with any other affiliated or unaffiliated entity; (d) seek or
obtain credit or incur any obligation to any third party based upon the assets
of its stockholder or any other affiliated or unaffiliated entity; or (e) induce
any such third party to reasonably rely on the creditworthiness of its
stockholder or any other affiliated or unaffiliated entity for the payment or
performance of the Depositor.
ARM'S LENGTH. The Depositor will maintain an arm's length relationship
between the Depositor and its stockholder and between the Depositor and any
affiliates of its stockholder.
DISCLOSURE OF THE TRANSACTIONS. The annual financial statements of the
Depositor will disclose the effects of the Transactions in accordance with
generally accepted accounting principles. The transfer of the Loans by its
stockholder to the Depositor pursuant to the
3
Purchase Agreement will be treated as a purchase by the Depositor under
generally accepted accounting principles. In particular, the financial
statements of the Depositor will clearly indicate its existence separate from
its stockholder and will reflect its separate assets and liabilities. None of
such financial statements, nor any consolidated financial statements for its
stockholder, will suggest in any way that the assets of the Depositor are
available to pay the claims of creditors of its stockholder or any other entity.
Any consolidated financial statements of its stockholder and its subsidiaries
prepared for the benefit of third parties will disclose, through appropriate
footnotes or otherwise, the separate corporate existence of the Depositor.
4