AMENDED AND RESTATED
INDENTURE OF TRUST
from
COLLEGE LOAN CORPORATION TRUST I
and
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Eligible Lender Trustee
to
DEUTSCHE BANK TRUST COMPANY AMERICAS,
as Trustee
Dated as of ______ __, 2003
COLLEGE LOAN CORPORATION TRUST I
Reconciliation and tie between Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act" or "TIA") and this Amended and Restated Indenture of
Trust, dated as of _________ __, 2003.
TRUST INDENTURE ACT SECTION INDENTURE SECTION
Section 310(a)(1) 7.13
Section 310(a)(3) 7.12
Section 310(b) 7.13
Section 313(c) 5.18, 8.04
Section 314(c) 4.13
Section 314(d)(1) 4.13
Section 3.18 7.13
____________________
NOTE: This reconciliation and tie shall not, for any purpose, be
deemed to be a part of the Indenture.
Attention should also be directed to Section 318(c) of the Trust Indenture
Act, which provides that the provisions of Sections 310 to and including 317 of
the Trust Indenture Act are a part of and govern every qualified indenture,
whether or not physically contained therein.
Table of Contents
Page
ARTICLE I
DEFINITIONS AND GENERAL PROVISIONS
Section 1.01. Definitions...................................................3
Section 1.02. Definitions of General Terms.................................23
Section 1.03. Computations.................................................23
Section 1.04. Compliance Certificates and Opinions, Etc....................23
Section 1.05. Evidence of Action by the Issuer.............................25
Section 1.06. Exclusion of Notes Held by or For the Issuer or Affiliates...25
Section 1.07. Exhibits.....................................................25
ARTICLE II
THE NOTES AND OTHER OBLIGATIONS
Section 2.01. General Title................................................25
Section 2.02. General Limitations; Issuable in Series; Purposes
and Conditions for Issuance; Payment of Principal
and Interest.................................................25
Section 2.03. Terms of Particular Series...................................27
Section 2.04. Form and Denominations.......................................27
Section 2.05. Execution, Authentication and Delivery.......................28
Section 2.06. Temporary Notes..............................................28
Section 2.07. Registration, Transfer and Exchange..........................29
Section 2.08. Mutilated, Destroyed, Lost and Stolen Notes..................32
Section 2.09. Interest Rights Preserved; Dating of Notes...................33
Section 2.10. Persons Deemed Holders.......................................33
Section 2.11. Cancellation.................................................34
Section 2.12. Credit Enhancement Facilities and Swap Agreements............34
ARTICLE III
PREPAYMENT OF NOTES
Section 3.01. Right of Prepayment..........................................34
Section 3.02. Election To Prepay or Purchase; Notice to Trustee;
Senior Asset Requirement and Subordinate Asset Requirement...35
Section 3.03. Selection by Trustee of Notes To Be Prepaid..................36
Section 3.04. Notice of Prepayment.........................................36
Section 3.05. Notes Payable on Prepayment Date and Sinking
Fund Payment Date............................................37
Section 3.06. Notes Prepaid in Part........................................37
Section 3.07. Purchase of Notes............................................37
ARTICLE IV
CREATION OF FUNDS AND ACCOUNTS; CREDITS THERETO AND PAYMENTS THEREFROM
Section 4.01. Creation of Funds and Accounts...............................38
Section 4.02. Acquisition Fund.............................................39
Section 4.03. Administration Fund..........................................42
Section 4.04. Reserve Fund.................................................43
Section 4.05. Collection Fund..............................................44
Section 4.06. Debt Service Fund............................................46
Section 4.07. Surplus Fund.................................................50
Section 4.08. Termination..................................................51
Section 4.09. Pledge.......................................................51
Section 4.10. Investments..................................................52
Section 4.11. Transfer of Investment Securities............................55
Section 4.12. Transfer of Money Following Revolving Period.................55
Section 4.13. Release......................................................56
ARTICLE V
COVENANTS TO SECURE NOTES, REPRESENTATIONS AND WARRANTIES
Section 5.01. Eligible Lender Trustee to Hold Financed Student Loans.......56
Section 5.02. Enforcement and Amendment of Guarantee Agreements............56
Section 5.03. Acquisition, Collection and Assignment of Student Loans......57
Section 5.04. Enforcement of Financed Student Loans........................57
Section 5.05. Administration and Collection of Financed Student Loans......57
Section 5.06. Punctual Payments............................................58
Section 5.07. Further Assurances...........................................58
Section 5.08. Protection of Security; Power to Issue Notes and
Pledge Revenues and Other Funds..............................59
Section 5.09. No Encumbrances..............................................59
Section 5.10. Continuing Existence; Merger and Consolidation...............60
Section 5.11. Amendment of Remarketing Agreements and Tender
Agent Agreements.............................................60
Section 5.12. Tax Treatment................................................61
Section 5.13. Representations and Warranties of the Issuer.................61
Section 5.14. Use of Trustee Eligible Lender Number........................62
Section 5.15. Additional Covenants.........................................62
Section 5.16. Covenant Regarding Financed Student Loans....................63
Section 5.17. Confirmation as to Trust Fund................................64
Section 5.18. Reports by Issuer............................................65
Section 5.19. Statement as to Compliance...................................65
Section 5.20. Opinions as to Trust Estate..................................65
Section 5.21. Representations of the Issuer Regarding the
Trustee's Security Interest..................................66
Section 5.22. Covenants of the Issuer Regarding the Trustee's
Security Interest............................................67
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.01. Events of Default............................................67
Section 6.02. Acceleration.................................................69
Section 6.03. Other Remedies; Rights of Beneficiaries......................71
Section 6.04. Direction of Proceedings by Acting Beneficiaries
Upon Default.................................................72
Section 6.05. Waiver of Stay or Extension Laws.............................72
Section 6.06. Application of Moneys........................................72
Section 6.07. Remedies Vested in Trustee...................................78
Section 6.08. Limitation on Suits by Beneficiaries.........................78
Section 6.09. Unconditional Right of Noteholders To Enforce Payment........78
Section 6.10. Trustee May File Proofs of Claims............................78
Section 6.11. Undertaking for Costs........................................79
Section 6.12. Termination of Proceedings...................................80
Section 6.13. Waiver of Defaults and Events of Default.....................80
Section 6.14. Inspection of Books and Records..............................80
ARTICLE VII
FIDUCIARIES
Section 7.01. Acceptance of the Trustee....................................81
Section 7.02. Fees, Charges and Expenses of the Trustee,
Paying Agents, Note Registrar, Authenticating Agents,
Remarketing Agents, Tender Agents, Auction Agents,
Market Agents and Broker-Dealers.............................83
Section 7.03. Notice to Beneficiaries if Default Occurs....................84
Section 7.04. Intervention by Trustee......................................84
Section 7.05. Successor Trustee, Paying Agents, Authenticating Agents, and
Tender Agents................................................84
Section 7.06. Resignation by Trustee, Paying Agents, Authenticating
Agents, and Tender Agents....................................85
Section 7.07. Removal of Trustee...........................................85
Section 7.08. Appointment of Successor Trustee.............................85
Section 7.09. Concerning any Successor Trustee.............................86
Section 7.10. Trustee Protected in Relying Upon Resolutions, Etc...........86
Section 7.11. Successor Trustee as Custodian of Funds......................86
Section 7.12. Co-Trustee...................................................86
Section 7.13. Corporate Trustee Required; Eligibility;
Conflicting Interests........................................88
Section 7.14. Statement by Trustee of Funds and Accounts and
Other Matters................................................88
Section 7.15. Trustee, Authenticating Agent, Note Registrar,
Paying Agents, Remarketing Agents, Tender Agents,
Auction Agents, Market Agents and Broker-Dealers May
Buy, Hold, Sell or Deal in Notes.............................89
Section 7.16. Authenticating Agent and Paying Agents; Paying
Agents To Hold Moneys in Trust...............................89
Section 7.17. Removal of Authenticating Agent and Paying Agents;
Successors.............................90
Section 7.18. Appointment and Qualifications of Tender Agents..............90
Section 7.19. Remarketing Agents...........................................92
Section 7.20. Qualifications of Remarketing Agents.........................92
Section 7.21. Indemnification of the Trustee...............................93
ARTICLE VIII
SUPPLEMENTAL INDENTURES
Section 8.01. Supplemental Indentures Not Requiring Consent
of Beneficiaries.............................................93
Section 8.02. Supplemental Indentures Requiring Consent of Beneficiaries...94
Section 8.03. Rights of Trustee............................................96
Section 8.04. Notice of Defaults...........................................96
Section 8.05. Conformity With the Trust Indenture Act......................96
Section 8.06. Consent of Tender Agents.....................................96
Section 8.07. Consent of Remarketing Agents................................96
Section 8.08. Consent of Auction Agents....................................96
Section 8.09. Consent of Broker-Dealers....................................96
Section 8.10. Consent of Market Agents.....................................97
ARTICLE IX
DEFEASANCE; MONEYS HELD FOR PAYMENT OF DEFEASED NOTES
Section 9.01. Discharge of Liens and Pledges; Notes No Longer
Outstanding and Deemed To Be Paid Hereunder..................97
Section 9.02. Notes Not Presented for Payment When Due; Moneys Held
for the Notes after Due Date of Notes........................99
ARTICLE X
MISCELLANEOUS
Section 10.01. Consent, Etc., of Noteholders................................100
Section 10.02. Limitation of Rights.........................................100
Section 10.03. Severability.................................................100
Section 10.04. Notices......................................................100
Section 10.05. Counterparts.................................................102
Section 10.06. Indenture Constitutes a Security Agreement...................102
Section 10.07. Payments Due on Non-Business Days............................102
Section 10.08. Notices to Rating Agencies...................................102
Section 10.09. Governing Law................................................103
Section 10.10. Rights of Other Beneficiaries................................103
Section 10.11. Subcontracting by Issuer.....................................103
Section 10.12. Role of Eligible Lender Trustee..............................103
Section 10.13. Limitation of Liability......................................103
ARTICLE XI
REPORTING REQUIREMENTS
Section 11.01. Annual Statement as to Compliance............................104
Section 11.02. Annual Independent Public Accountants' Servicing Report......104
Section 11.03. Issuer Administrator's Certificate...........................104
Section 11.04. Statements to Noteholders....................................104
EXHIBITA - ELIGIBLE LOAN ACQUISITION CERTIFICATE
EXHIBIT B - ACQUISITION ACCOUNT DEPOSIT CERTIFICATE
EXHIBIT C - ORIGINATION LOAN CERTIFICATE
EXHIBIT D - ORIGINATION LOAN CERTIFICATE
THIS AMENDED AND RESTATED INDENTURE OF TRUST, dated as of ______ __, 2003,
among COLLEGE LOAN CORPORATION TRUST I, a Delaware statutory trust (herein
called the "Issuer"), DEUTSCHE BANK TRUST COMPANY AMERICAS, as trustee pursuant
to an Eligible Lender Trust Agreement (as hereinafter defined) with the Issuer
dated the date hereof (herein called the "Eligible Lender Trustee"), and
DEUTSCHE BANK TRUST COMPANY AMERICAS, a banking corporation duly established,
existing and authorized to accept and execute trusts of the character herein set
out under and by virtue of the laws of the State of New York, as trustee (herein
called the "Trustee");
RECITALS OF THE ISSUER
WHEREAS, the Issuer and the Trustee entered into an Indenture of Trust
dated as of March 1, 2002 (as previously amended the "Initial Indenture") in
connection with the issuance by the Issuer of Student Loan Asset-Backed Notes;
and
WHEREAS, Section 8.01 of the Initial Indenture permits the Initial
Indenture to be amended from time to time by the parties thereto in accordance
with the terms of Section 8.01; and
WHEREAS, the parties hereto wish to amend and restate the Initial Indenture
in its entirety to read as set forth herein, and all conditions required by
Section 8.01 of the Initial Indenture have been satisfied; and
WHEREAS, this Indenture is subject to the provisions of the Trust Indenture
Act of 1939, as amended (the "Trust Indenture Act" or "TIA"), that are deemed to
be incorporated into this Indenture and shall, to the extent applicable, be
governed by such provisions; and
WHEREAS, the Initial Indenture is hereby amended and restated in its
entirety to read as follows;
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
The Issuer and the Eligible Lender Trustee, in consideration of the
premises and the acceptance by the Trustee of the trusts hereby created and of
the purchase and acceptance of the Notes by the Holders thereof, the execution
and delivery of any Swap Agreement (as hereinafter defined) by any Swap
Counterparty (as hereinafter defined), the execution and delivery of any Credit
Enhancement Facility (as hereinafter defined) by any Credit Facility Provider
(as hereinafter defined), and the acknowledgment thereof by the Trustee, in
order to secure the payment of the principal of, premium, if any, and interest
on and any Carry-Over Amounts (and accrued interest thereon) with respect to the
Notes according to their tenor and effect and the performance and observance by
the Issuer of all the covenants expressed or implied herein and in the Notes and
in any such Swap Agreement or Credit Enhancement Facility, do hereby grant to
the Trustee, and to its successors in trust, and to them and their assigns,
forever, a security interest in the following:
GRANTING CLAUSE FIRST
All rights, title, interest and privileges of the Issuer and/or the
Eligible Lender Trustee (a) with respect to Financed Student Loans, in, to and
under any Servicing Agreement, the Eligible Lender Trust Agreement, the
Guarantee Agreements and any purchase and sale agreements pursuant to which the
Issuer acquires Financed Student Loans; (b) in, to and under all Financed
Student Loans (including the evidences of indebtedness thereof and related
documentation), the proceeds of the sale of the Notes (until expended for the
purpose for which the Notes were issued) and the revenues, moneys, evidences of
indebtedness and securities (including any earnings thereon) in and payable into
the Acquisition Fund, Debt Service Fund, Collection Fund, Reserve Fund,
Administration Fund and Surplus Fund, in the manner and subject to the prior
applications provided in Article IV hereof; and (c) in, to and under any Credit
Enhancement Facility, any Swap Agreement, any Swap Counterparty Guaranty, any
Tender Agent Agreement, any Remarketing Agreement, any Auction Agent Agreement,
any Market Agent Agreement and any Broker-Dealer Agreement, all as hereinbefore
and hereinafter defined, including any contract or any evidence of indebtedness
or other rights of the Issuer to receive any of the same whether now existing or
hereafter coming into existence, and whether now or hereafter acquired;
GRANTING CLAUSE SECOND
All proceeds from any property described in these Granting Clauses and any
and all other property of every name and nature from time to time hereafter by
delivery or by writing of any kind conveyed, pledged, assigned or transferred,
as and for additional security hereunder by the Issuer or by anyone in its
behalf or with its written consent to the Trustee, which is hereby authorized to
receive any and all such property at any and all times and to hold and apply the
same subject to the terms hereof;
To Have and to Hold all the same with all privileges and appurtenances
hereby conveyed and assigned, or agreed or intended so to be, to the Trustee and
its successors in said trust and to them and their assigns forever;
In Trust Nevertheless, upon the terms and trust herein set forth (a) for
the equal and proportionate benefit, security and protection of all present and
future Senior Beneficiaries (as hereinafter defined), without privilege,
priority or distinction as to lien or otherwise of any of the Senior
Beneficiaries over any of the others; (b) for the equal and proportionate
benefit, security and protection of all present and future Subordinate
Beneficiaries (as hereinafter defined), without privilege, priority or
distinction as to the lien or otherwise of any of the Subordinate Beneficiaries
over any of the others, but on a basis subordinate to the Senior Beneficiaries
on the terms described herein; and (c) for the equal and proportionate benefit,
security and protection of all present and future Junior Subordinate
Beneficiaries (as hereinafter defined), without privilege, priority or
distinction as to the lien or otherwise of any of the Junior Subordinate
Beneficiaries over any of the others, but on a basis subordinate to the Senior
Beneficiaries and the Subordinate Beneficiaries on the terms described herein;
Provided, however, that if the Issuer, its successors or assigns, shall
well and truly pay, or cause to be paid, the principal of and premium, if any,
on the Notes and the interest and any Carry-Over Amounts (and accrued interest
thereon) with respect thereto due and to become due thereon, or provide fully
for payment thereof as herein provided, at the times and in the manner mentioned
in the Notes, according to the true intent and meaning thereof, and shall make
the payments into the Trust Funds as required under Article IV hereof, or shall
provide, as permitted hereby, for the payment thereof by depositing with the
Trustee sums sufficient for payment of the entire amount due and to become due
thereon as herein provided, and shall well and truly keep, perform and observe
all the covenants and conditions pursuant to the terms of this Indenture to be
kept, performed and observed by it, and shall pay to the Trustee, any Swap
Counterparty and any Credit Facility Provider all sums of money due or to become
due to them in accordance with the terms and provisions hereof, then (except as
otherwise provided in a Supplemental Indenture) this Indenture and the rights
hereby granted shall cease, terminate and be void; otherwise, this Indenture
shall be and remain in full force and effect.
NOW, THEREFORE, it is mutually covenanted and agreed for the benefit of all
Holders of the Notes and for the benefit of any Swap Counterparty and any Credit
Facility Provider, as follows:
ARTICLE I
DEFINITIONS AND GENERAL PROVISIONS
SECTION 1.01. DEFINITIONS. In this Indenture the following terms have the
following respective meanings unless the context hereof clearly requires
otherwise:
"ACCOUNT" means any of the segregated non-interest bearing accounts created
within the Funds established by this Indenture; provided, however, such Accounts
may be invested in Investment Securities in accordance with this Indenture,
which investments may produce earnings or income.
"ACCOUNTANT" means Weiss, Redington & Company, any other registered or
certified public accountant or firm of such accountants selected and paid by the
Issuer, who is Independent and not under the domination of the Issuer, but who
may be regularly retained to make annual or similar audits of the books or
records of the Issuer.
"ACQUISITION ACCOUNT AGREEMENT" means a Custodial Account Agreement among
the Issuer, the Trustee, the Sponsor and a Servicer, each as amended and
supplemented.
"ACQUISITION ACCOUNT DEPOSIT CERTIFICATE" means a certificate signed by an
Authorized Officer of the Issuer and substantially in the form attached as
Exhibit B hereto.
"ACQUISITION FUND" means the Acquisition Fund created and established by
Section 4.01 hereof.
"ACQUISITION PERIOD" with respect to any series of Notes shall have the
meaning set forth in the related Supplemental Indenture.
"ACTING BENEFICIARIES UPON DEFAULT" means:
(a) at any time that any Senior Obligations are Outstanding: (i) with
respect to directing the Trustee to accelerate the Outstanding Notes pursuant to
Section 6.02 hereof (A) upon an Event of Default described in clauses (a)
through (d) of Section 6.01, the Holders of a majority in aggregate Principal
Amount of Senior Notes Outstanding; and (B) upon any other Event of Default
described in Section 6.01, the Holders of a majority in aggregate Principal
Amount of all Notes Outstanding; (ii) with respect to requesting the Trustee to
exercise rights and powers under the Indenture, directing the conduct of
proceedings in connection with the enforcement of the Indenture and requiring
the Trustee to waive Events of Default (other than pursuant to (i) above): the
Holders of a majority in aggregate Principal Amount of the Senior Notes
Outstanding (and, to the extent provided in a Supplemental Indenture
satisfactory to the Rating Agencies, the Holders of Other Senior Obligations as
shall be set forth in such Supplemental Indenture); and (iii) with respect to
all other matters under the Indenture, the Holders of a majority in aggregate
Principal Amount of Senior Notes Outstanding (and, to the extent provided in a
Supplemental Indenture satisfactory to the Rating Agencies, the Holders of Other
Senior Obligations as shall be set forth in such Supplemental Indenture);
(b) at any time that no Senior Obligations are Outstanding but Subordinate
Obligations are Outstanding: (i) with respect to directing the Trustee to
accelerate the Outstanding Notes pursuant to Section 6.02 hereof (A) upon an
Event of Default described in clauses (e) through (h) of Section 6.01 hereof,
the Holders of a majority in aggregate Principal Amount of Subordinate Notes
Outstanding; and (B) upon any other Event of Default described in Section 6.01,
the Holders of a majority in aggregate Principal Amount of all Notes
Outstanding; (ii) with respect to requesting the Trustee to exercise rights and
powers under the Indenture, directing the conduct of proceedings in connection
with the enforcement of the Indenture and requiring the Trustee to waive Events
of Default (other than pursuant to (i) above: (A) the Holders of a majority in
aggregate Principal Amount of the Subordinate Notes Outstanding (and, to the
extent provided in a Supplemental Indenture satisfactory to the Rating Agencies,
the Holders of Other Senior Obligations (as shall be set forth in such
Supplemental Indenture); and (iii) with respect to all other matters under the
Indenture, the Holders of a majority in aggregate Principal Amount of
Subordinate Notes Outstanding; and
(c) at any time that no Senior Obligations and no Subordinate Obligations
are Outstanding but any Junior Subordinate Notes are Outstanding, the Holders of
a majority in aggregate Principal Amount of Junior Subordinate Obligations
Outstanding.
"ADD-ON LOAN" means, (i) with respect to any Consolidation Loan owned by
the Issuer, an amount equal to the increased balance of such Consolidation Loan
arising out of amounts required to be paid to a Lender at the request of the
related borrower within 180 days of the date such Consolidation Loan was
originated and (ii) with respect to any other FFELP Loan owned by the Issuer for
which only the initial disbursement has been made, an amount equal to the
increased balance of such FFELP Loan arising out of any subsequent disbursement.
"ADMINISTRATION AGREEMENT" means the Administration Agreement dated as of
March 1, 2002, among the Issuer Administrator, the Issuer, the Trustee, the
Eligible Lender Trustee and the Delaware Trustee as such agreement may be
amended or supplemented from time to time.
"ADMINISTRATION FEE" means, with respect to each series of Notes, a monthly
fee in an amount set forth in the Supplemental Indenture authorizing such series
of Notes, which shall be released to the Issuer Administrator each month to
cover expenses (other than Servicing Fees and Note Fees) incurred in connection
with carrying out and administering its powers, duties and functions under this
Indenture and any related agreements.
"ADMINISTRATION FUND" means the Administration Fund created and established
by Section 4.01 hereof.
"AGGREGATE VALUE" means on any calculation date the sum of the Values of
all assets of the Trust Estate.
"ASSET RELEASE REQUIREMENT" means, at any time, any requirement set forth
as such in a Supplemental Indenture.
"AUCTION AGENT" means, with respect to any series of Notes, any bank,
national banking association or trust company designated as such with respect to
such Notes pursuant to the provisions of a Supplemental Indenture, and its
successor or successors, and any bank, national banking association or trust
company at any time substituted in its place pursuant to such Supplemental
Indenture.
"AUCTION AGENT AGREEMENT" means, with respect to any series of Notes, an
agreement among an Auction Agent and the Trustee setting forth the rights and
obligations of the Auction Agent acting in such capacity with respect to such
Notes under this Indenture and the related Supplemental Indenture, including any
supplement thereto or amendment thereof entered into in accordance with the
provisions thereof.
"AUTHENTICATING AGENT" when used with respect to a series of Notes, means a
bank or trust company (which may be the Trustee) appointed for the purpose of
receiving, authenticating and delivering Notes of that series in connection with
transfers, exchanges and registrations as in this Indenture provided, and its
successor or successors and any other bank or trust company which may at any
time be substituted in its place as Authenticating Agent pursuant to this
Indenture.
"AUTHORIZED OFFICER" when used with reference to the Issuer, means those
individuals authorized to act for the Issuer Administrator, as set forth in a
list of Authorized Officers delivered by the Issuer Administrator to the Trustee
and the Delaware Trustee, as such list may be amended from time to time by the
Issuer Administrator.
"BALANCE" when used with reference to any Account or Fund, means the
aggregate sum of all assets standing to the credit of such Account or Fund,
including, without limitation, Investment Securities computed at the Value
thereof; Financed Student Loans computed at the Value thereof; and lawful money
of the United States; provided, however, that (a) the Balance of the Interest
Account shall not include amounts standing to the credit thereof which are being
held therein for (i) the payment of past due and unpaid interest on Notes; or
(ii) the payment of interest on Notes that are deemed no longer Outstanding as a
result of the defeasance thereof pursuant to subparagraph (b) of the first
paragraph of Section 9.01 hereof; and (b) the Balances of the Principal Account
and the Retirement Account shall not include amounts standing to the credit
thereof which are being held therein for the payment of principal of or premium,
if any, on Notes which are deemed no longer Outstanding in accordance with the
provisions of subparagraph (b) of the first paragraph of Section 9.01 hereof.
"BENEFICIAL OWNER" means the Person in whose name a Note is recorded as
beneficial owner of such Note by a securities depository under a book-entry
system, or by a participant or indirect participant in such securities
depository, as the case may be.
"BENEFICIAL OWNERSHIP INTEREST" means the right to receive payments and
notices with respect to Notes which are held by a securities depository under a
book-entry system and for which the securities depository does not act on behalf
of the Beneficial Owner in connection with the optional or mandatory tender of
Notes on a Tender Date.
"BENEFICIARIES" means, collectively, all Senior Beneficiaries, all
Subordinate Beneficiaries and all Junior Subordinate Beneficiaries.
"BOOK-ENTRY NOTES" means Notes registered in book-entry form.
"BORROWER BENEFITS" means, with respect to any Financed Student Loan,
pursuant to an agreement or agreements, any reduction or forgiveness of
principal and/or interest payments or a reduction in interest rate provided on
such Financed Student Loan.
"BROKER-DEALER" means, with respect to any series of Notes, any broker or
dealer (each as defined in the Exchange Act), commercial bank or other entity
permitted by law to perform the functions required of a broker-dealer set forth
in the auction procedures relating to such Notes, designated as such with
respect to such Notes pursuant to the provisions of a Supplemental Indenture,
and its successor or successors, and any broker or dealer, commercial bank or
other entity at any time substituted in its place pursuant to such Supplemental
Indenture.
"BROKER-DEALER AGREEMENT" means, with respect to any series of Notes, an
agreement between an Auction Agent and a Broker-Dealer, and approved by the
Issuer, setting forth the rights and obligations of the Broker-Dealer acting in
such capacity with respect to such Notes under this Indenture and the related
Supplemental Indenture, including any supplement thereto or amendment thereof
entered into in accordance with the provisions thereof.
"BUSINESS DAY" means a day of the year other than a Saturday, a Sunday or a
day on which banks located in the city in which the Principal Office of the
Trustee is located, in the city in which the Principal Office of any
Authenticating Agent is located, in the city in which the Principal Office of
the Issuer is located or in New York, New York, are required or authorized by
law to remain closed, or on which The New York Stock Exchange is closed;
provided, that a Supplemental Indenture may provide for a different meaning with
respect to Notes of any series issued pursuant thereto.
"CASH FLOWS" means cash flow schedules prepared by the Issuer or its
designee, including a listing of all assumptions used in the preparation of such
cash flow schedules, in connection with the issuance of any Notes hereunder or
in connection with the satisfaction of certain Rating Agency Conditions.
"CARRY-OVER AMOUNT" means, if and to the extent specifically provided for
as such in a Supplemental Indenture with respect to a series of Variable Rate
Notes, the excess, if any, of (a) the amount of interest on a Note that would
have accrued with respect to the related interest period at the applicable
interest rate over (b) the amount of interest on such Note actually accrued with
respect to such Note, with respect to such interest period based on the maximum
rate specified in a Supplemental Indenture, together with the unpaid portion of
any such excess from prior interest periods. To the extent required by a
Supplemental Indenture providing for any Carry-Over Amount, interest will accrue
on such Carry-Over Amount until paid. Any reference to "principal" or "interest"
in this Indenture and in the related Notes shall not include, within the
meanings of such words, any Carry-Over Amount or any interest accrued on any
Carry-Over Amount.
"CODE" means the Internal Revenue Code of 1986, as amended, or any
successor legislation thereto.
"COLLECTION FUND" means the Collection Fund created and established by
Section 4.01 hereof.
"COLLEGE LOAN CORPORATION" means the College Loan Corporation, a California
corporation.
"COMMISSION" means the Securities and Exchange Commission.
"CONSOLIDATION LOAN" means a Student Loan made pursuant to Section 428C of
the Higher Education Act.
"COSTS OF ISSUANCE" means all items of expense directly or indirectly
payable by or reimbursable to the Issuer and related to the authorization, sale
and issuance of a series of the Notes, including, but not limited to, printing
costs, costs of preparation and reproduction of documents, filing fees, initial
fees, charges and expenses of the Trustee, the Eligible Lender Trustee, any
Authenticating Agent, any Remarketing Agent, any Tender Agent, any Auction
Agent, any Market Agent or any Broker-Dealer, legal fees and charges, fees and
disbursements of underwriters, consultants and professionals, underwriters'
discount, costs of credit ratings, fees and charges for preparation, execution,
transportation and safekeeping of such Notes, other costs incurred by the Issuer
in anticipation of the issuance of such Notes and any other cost, charge or fee
in connection with the issuance of such Notes.
"COUNSEL" means a person, or firm of which such a person is a member,
authorized in any state or the District of Columbia to practice law.
"COUNTERPARTY SWAP PAYMENT" means a payment due to or received by the
Issuer from a Swap Counterparty pursuant to a Swap Agreement (including, but not
limited to, payments in respect of any early termination of such Swap Agreement)
and amounts received by the Issuer under any related Swap Counterparty Guaranty.
"CREDIT ENHANCEMENT FACILITY" means, if and to the extent provided for in a
Supplemental Indenture described in Section 8.01(h) hereof, with respect to
Notes of one or more series (a) an insurance policy insuring, or a letter of
credit or surety bond providing a direct or indirect source of funds for, the
timely payment of principal of and interest on such Notes (but not necessarily
principal due upon acceleration thereof under Section 6.02 hereof); or (b) a
letter of credit, standby purchase agreement, or similar instrument, providing
for the purchase of such Notes on a Tender Date, and in either case, all
agreements entered into by the Issuer or the Trustee and the Credit Facility
Provider with respect thereto.
"CREDIT FACILITY PROVIDER" means, if and to the extent provided for in a
Supplemental Indenture entered into pursuant to Section 8.01(h) hereof, any
Person or Persons engaged by the Issuer pursuant to a Credit Enhancement
Facility, to provide credit enhancement or liquidity for the payment of the
principal of and interest on any or all of the Notes of one or more series or
the Issuer's obligation to purchase Notes on a Tender Date.
"CUSTODIAN" means each Servicer with respect to Financed Student Loans it
services pursuant to a Servicing Agreement, as custodian pursuant to the
respective Servicing Agreements or separate custody agreements, and any other
Person entering into a custody agreement and satisfying the Rating Agency
Condition.
"DEBT SERVICE" means: (a) with respect to any Notes, as of any particular
date and with respect to any particular period, the aggregate of the moneys to
be paid or set aside on such date or during such period for the payment (or
retirement) of the principal of, premium, if any, and interest on Notes; and (b)
with respect to Other Obligations, as of any particular date and with respect to
any particular period, the aggregate of the moneys to be paid or set aside on
such date or during such period for the payment of amounts payable by the Issuer
under any Swap Agreements or Credit Enhancement Facilities, including fees
payable by the Issuer to the Credit Facility Provider thereunder.
"DEBT SERVICE FUND" means the Fund by that name created and established by
Section 4.01 hereof.
"DEFAULTED INTEREST" shall have the meaning given in Section 2.02 hereof.
"DELAWARE TRUSTEE" means Wilmington Trust Company, not in its individual
capacity but solely as trustee under the Trust Agreement, and its successors and
assigns in such capacity.
"DEPOSITORY" means DTC or its successors or assigns.
"DEPOSITORY PARTICIPANT" means a Person for whom, from time to time, the
Depository effects book-entry transfers and pledges of securities deposited with
the Depository.
"DIRECT PARTICIPANT" means any broker-dealer, bank or other financial
institution for whom the nominee of the Depository holds an interest in any
Note.
"DTC" means The Depository Trust Company.
"DTC CUSTODIAN" means the Trustee as a custodian for DTC.
"ELIGIBLE LENDER TRUST AGREEMENT" means the Trust Agreement dated as of the
date hereof between the Issuer, as grantor, and the Eligible Lender Trustee, as
trustee, and any similar agreement entered into by the Issuer and an "eligible
lender" under the Higher Education Act pursuant to which such "eligible lender"
holds Financed FFELP Loans as legal owner in trust for the Issuer as beneficial
owner, in each case as supplemented or amended from time to time.
"ELIGIBLE LENDER TRUSTEE" means Deutsche Bank Trust Company Americas,
trustee under the Eligible Lender Trust Agreement, and its successors and
assigns in such capacity.
"ELIGIBLE LOAN" means: a Student Loan which: (a) has been or will be made
to a borrower for post-secondary education; (b) is a FFELP Loan which is
Guaranteed; and (c) is an "eligible loan" as defined in Section 438 of the
Higher Education Act for purposes of receiving Special Allowance Payments to the
extent permitted by the Higher Education Act; provided, however, that no more
than 5% of the Principal Balance of Financed Student Loans may include
Consolidation Loans for which no Special Allowance Payment is permitted to be
paid pursuant to the Higher Education Act and no more than 10% of the Principal
Balance of Financed Student Loans may be Eligible Loans made with respect to
students attending proprietary schools.
"ELIGIBLE LOAN ACQUISITION CERTIFICATE" means a certificate signed by an
Authorized Officer of the Issuer and substantially in the form attached as
Exhibit A hereto.
"ESCROW ACCOUNT" shall have the meaning set forth in Section 4.01 hereof.
"EVENT OF DEFAULT" means one of the events described as such in Section
6.01 hereof.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.
"FEDERAL REIMBURSEMENT CONTRACT" means any agreement between a Guarantee
Agency and the Secretary of Education providing for the payment by the Secretary
of Education of amounts authorized to be paid pursuant to the Higher Education
Act, including (but not necessarily limited to) partial reimbursement of amounts
paid or payable upon defaulted Financed FFELP Loans and other student loans
guaranteed or insured by the Guarantee Agency and interest subsidy payments to
holders of qualifying student loans Guaranteed by the Guarantee Agency.
"FFELP LOAN" means a Student Loan made pursuant to the Higher Education
Act., including any Additional Advances as defined in the Loan Purchase
Agreement.
"FINANCED" when used with respect to Student Loans, Eligible Loans or FFELP
Loans, means Student Loans, Eligible Loans or FFELP Loans, as the case may be,
acquired or originated by the Issuer or the Eligible Lender Trustee on behalf of
the Issuer with moneys in the Acquisition Fund or the Surplus Fund, any Eligible
Loans received in exchange for Financed Student Loans upon the sale thereof or
substitution therefor in accordance with Section 4.02 hereof and any other
Student Loans deemed "Financed" with moneys in the Acquisition Fund and the
Surplus Fund pursuant to this Indenture, but does not include Student Loans
released from the lien of this Indenture and sold, as permitted in this
Indenture, to any purchaser, including a trustee for the holders of the Issuer's
bonds, notes or other evidences of indebtedness issued other than pursuant to
the Indenture.
"FISCAL YEAR" means the fiscal year of the Issuer as established from time
to time, initially ending December 31.
"FUND" means any of the segregated non-interest bearing funds created or
established by this Indenture; provided, however, such Funds may be invested in
Investment Securities in accordance with this Indenture, which investments may
produce earnings or income.
"GOVERNMENT OBLIGATIONS" means noncallable direct obligations of, or
obligations the full and timely payment of the principal of and interest on
which are unconditionally guaranteed by, the United States of America.
"GUARANTEE" or "GUARANTEED" means, with respect to a FFELP Loan, the
insurance or guarantee by a Guarantee Agency, to the extent provided in the
Higher Education Act, of the principal of and accrued interest on such FFELP
Loan, and the coverage of such FFELP Loan by one or more Federal Reimbursement
Contracts providing, among other things, for reimbursement to the Guarantee
Agency for losses incurred by it on defaulted Financed Student Loans insured or
guaranteed by the Guarantee Agency to the extent provided in the Higher
Education Act.
"GUARANTEE AGENCY" means any state agency or private nonprofit institution
or organization which has Federal Reimbursement Contracts in place and has
entered into a Guarantee Agreement with the Eligible Lender Trustee, and any
such guarantor's successors and assigns.
"GUARANTEE AGREEMENTS" means the blanket guarantee and other guarantee
agreements issued by or from any Guarantee Agency to the Eligible Lender Trustee
for the purpose of Guaranteeing FFELP Loans to be Financed hereunder, and any
amendment of any of the foregoing entered into in accordance with the provisions
thereof providing for the insurance or guarantee by such Guarantee Agency, to
the extent provided in the Higher Education Act, of the principal of an accrued
interest on Financed FFELP Loans acquired by the Trustee from time to time.
"HIGHER EDUCATION ACT" means the Higher Education Act of 1965, as amended
or supplemented from time to time, and all regulations promulgated thereunder.
"HOLDER" when used with respect to any Note, means the Person in whose name
such Note is registered in the Note Register, except that to the extent and for
the purposes provided in a Supplemental Indenture for a series of Notes
(including, without limitation, for purposes of the definition of "Acting
Beneficiaries Upon Default"), a Credit Facility Provider that has delivered a
Credit Enhancement Facility with respect to such series of Notes may instead be
treated as the Holder of the Notes of such series.
"INDENTURE" means this Indenture of Trust, including any supplement hereto
or amendment hereof entered into in accordance with the provisions hereof.
"INDEPENDENT" when used with respect to any specified Person, means such a
Person who (a) is in fact independent; (b) does not have any direct financial
interest or any material indirect financial interest in the Issuer, other than
the payment to be received under a contract for services to be performed by such
Person; and (c) is not connected with the Issuer as an official, officer,
employee, promoter, underwriter, trustee, partner, affiliate, subsidiary,
director or Person performing similar functions. Whenever it is herein provided
that any Independent Person's opinion or certificate shall be furnished to the
Trustee, such Person shall be appointed by the Issuer or the Trustee, as the
case may be, and such opinion or certificate shall state that the signer has
read this definition and that the signer is Independent within the meaning
hereof.
"INDIRECT PARTICIPANT" means any financial institution for whom any Direct
Participant holds an interest in any Note.
"INDIVIDUAL NOTE" means any Note registered in the name of a holder other
than the Depository or its nominee.
"INITIAL NOTES" means the Notes issued contemporaneously with the execution
and delivery of this Indenture pursuant to the First Supplemental Indenture of
Trust dated as of March 1, 2002, between the Issuer and the Trustee.
"INTEREST ACCOUNT" means the Account by that name created and established
by Section 4.01 hereof.
"INTEREST PAYMENT DATE" means each regularly scheduled interest payment
date on the Notes (which dates shall be specified in the Supplemental Indenture
providing for the issuance thereof) or, with respect to the payment of interest
upon redemption or acceleration of a Note, purchase of a Note by the Trustee on
a Tender Date (to the extent such Tender Date is designated as an Interest
Payment Date in the related Supplemental Indenture) or the payment of Defaulted
Interest, such date on which such interest is payable under this Indenture or a
Supplemental Indenture.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940, as
amended.
"INVESTMENT SECURITIES" means any of the following:
(a) direct general obligations of, or obligations fully and unconditionally
guaranteed as to the timely payment of principal and interest by, the United
States or any agency or instrumentality thereof, provided such obligations are
backed by the full faith and credit of the United States, FHA debentures,
Freddie Mac senior debt obligations, Federal Home Loan Bank consolidated senior
debt obligations, and Fannie Mae senior debt obligations, but excluding any of
such securities whose terms do not provide for payment of a fixed dollar amount
upon maturity or call for redemption;
(b) federal funds, certificates of deposit, time deposits and banker's
acceptances (having original maturities of not more than 365 days) of any bank
or trust company incorporated under the laws of the United States or any state
thereof, provided that the short-term debt obligations of such bank or trust
company at the date of acquisition thereof have been rated "A-1+" or better by
S&P and "P-1" or better by Moody's;
(c) deposits of any bank or savings and loan association which has combined
capital, surplus and undivided profits of at least $3,000,000 which deposits are
held only up to the limits insured by the Bank Insurance Fund or Savings
Association Insurance Fund administered by the Federal Deposit Insurance
Corporation, provided that the unsecured long-term debt obligations of such bank
or savings and loan association have been rated "BBB" or better by S&P and
"Baa3" or better by Moody's;
(d) commercial paper (having original maturities of not more than 365 days)
rated "A-1+" or better by S&P and "P-1" or better by Moody's;
(e) debt obligations rated "AAA" by S&P and "Aaa" by Moody's (other than
any such obligations that do not have a fixed par value and/or whose terms do
not promise a fixed dollar amount at maturity or call date);
(f) investments in money market funds (including those funds managed or
advised by the Trustee or an affiliate thereof) rated "AAAm" by S&P and "Aaa" by
Moody's;
(g) guaranteed investment contracts or surety bonds satisfying the Rating
Agency Condition and providing for the investment of funds in an account or
insuring a minimum rate of return on investments of such funds, which contract
or surety bond shall:
(i) be an obligation of or guaranteed by an insurance company or
other corporation or financial institution whose debt obligations or
insurance financial strength or claims paying ability are rated "AAA"
by S&P and "Aaa" by Moody's;
(ii) provide that the Trustee may exercise all of the rights of
the Issuer under such contract or surety bond without the necessity of
the taking of any action by the Issuer;
(h) a repurchase agreement that satisfies the following criteria:
(i) must be between the Trustee and a dealer, bank, securities
firm, insurance company or other financial institution described in
(A) or (B) below:
(A) primary dealers on the Federal Reserve reporting dealer
list which (x) have a long term rating of "A" or better by S&P
and "Aa2" or better by Moody's or (y) have a long term rating of
"A" or better by S&P and "Aa3" or better by Moody's and a short
term rating of "P-1" by Moody's, or
(B) banks, insurance companies or other financial
institutions which (x) have a long term rating of "A" or both by
S&P and "Aa2" or better by Moody's or (y) have a long term rating
of "A" or better by S&P and "Aa3" or better by Moody's and a
short term rating of "P-1" by Moody's;
(ii) the written repurchase agreement must include the following:
Securities which are acceptable for the transfer are:
(A) Direct U.S. governments, or
(B) Federal Agencies backed by the full faith and credit of
the U.S. government (and Fannie Mae & Freddie Mac); and
(iii) the collateral must be delivered to the Trustee or third
party custodian acting as agent for the Trustee by appropriate book
entries and confirmation statements must have been delivered before or
simultaneous with payment (perfection by possession of certificated
securities); and
(i) any other investment satisfying the Rating Agency Condition (provided,
however, that if such other investment meets the rating criteria above for a
particular Rating Agency but not all Rating Agencies, then a Rating Agency
Condition need be satisfied only with respect to any other Rating Agency for
which such rating criteria has not been met).
"ISSUER" means College Loan Corporation Trust I, a Delaware statutory
trust, and any successor or assignee thereto under this Indenture.
"ISSUER ADMINISTRATOR" means College Loan Corporation in its capacity as
administrator under that certain Administration Agreement, or Deutsche Bank
Trust Company Americas, or any other Person providing similar services and
satisfying the Rating Agency Condition.
"ISSUER ORDER" or "ISSUER CERTIFICATE" means, respectively, a written order
or certificate signed in the name of the Issuer by an Authorized Officer (and,
after the date of issuance of the first Notes hereunder, signed by another
person designated by a different Authorized Officer) and delivered to the
Trustee.
"ISSUER SWAP PAYMENT" means a payment due to a Swap Counterparty from the
Issuer pursuant to the applicable Swap Agreement (including, but not limited to,
payments in respect of any early termination of such Swap Agreement).
"JOINT SHARING AGREEMENT" shall have the meaning set forth in Section 5.14
hereof.
"JUNIOR SUBORDINATE BENEFICIARIES" means (a) the Holders of any Outstanding
Junior Subordinate Notes and (b) any Other Junior Subordinate Beneficiary
holding any Other Junior Subordinate Obligation that is Outstanding.
"JUNIOR SUBORDINATE CREDIT ENHANCEMENT FACILITY" means a Credit Enhancement
Facility designated as a Junior Subordinate Credit Enhancement Facility in the
Supplemental Indenture pursuant to which such Credit Enhancement Facility is
furnished by the Issuer.
"JUNIOR SUBORDINATE CREDIT FACILITY PROVIDER" means any person who provides
a Junior Subordinate Credit Enhancement Facility.
"JUNIOR SUBORDINATE NOTES" means any Notes designated in a Supplemental
Indenture as Junior Subordinate Notes, which are secured under this Indenture on
a basis subordinate to any Senior Obligations and Subordinate Obligations (as
such subordination is described herein, and on a parity with Other Junior
Subordinate Obligations).
"JUNIOR SUBORDINATE OBLIGATIONS" means, collectively, the Junior
Subordinate Notes and any Other Junior Subordinate Obligations.
"JUNIOR SUBORDINATE SWAP AGREEMENT" means a Swap Agreement designated as a
Junior Subordinate Swap Agreement in the Supplemental Indenture pursuant to
which such Swap Agreement is furnished by the Issuer.
"JUNIOR SUBORDINATE SWAP COUNTERPARTY" means any Person who provides a
Junior Subordinate Swap Agreement.
"LENDER" means the Issuer or any party from which the Issuer (or the
Eligible Lender Trustee on behalf of the Issuer) acquires Eligible Loans, which
must be an "eligible lender" (as defined in the Higher Education Act).
"LETTER OF REPRESENTATIONS" means any Letter of Representations relating to
Book-Entry Notes among the Issuer, the Trustee and the Depository.
"LOAN PURCHASE AGREEMENT" means the FFELP Loan Purchase Agreement dated as
of March 1, 2002, as supplemented and amended, among the Issuer, College Loan
Corporation, the Eligible Lender Trustee and the eligible lender trustee for
College Loan Corporation, and any other similar agreements upon satisfaction of
a Rating Agency Condition.
"MARKET AGENT" means, with respect to any series of Notes, the Person
identified as such in the related Supplemental Indenture, and its successor or
successors, and any Person at any time substituted in its place pursuant to such
Supplemental Indenture.
"MARKET AGENT AGREEMENT" means, with respect to any series of Notes, an
agreement between a Market Agent and the Trustee designated as such in the
Supplemental Indenture pursuant to which the issuance of such series of Notes is
authorized.
"MATURITY" when used with respect to any Note, means the date on which the
entire outstanding Principal Amount of such Note becomes due and payable as
therein or herein provided, whether at the Stated Maturity thereof or by
declaration of acceleration, redemption, distribution of principal or otherwise.
"MONTHLY CALCULATION DATE" means the twenty-fifth day of each calendar
month (or, in the event such twenty-fifth day is not a Business Day, the next
succeeding Business Day).
"MONTHLY SERVICING REPORT" means a report prepared by or on behalf of the
Issuer setting forth certain information with respect to the Financed Student
Loans as of the end of each month.
"MOODY'S" means Moody's Investors Service, Inc., its successors and their
assigns, and, if such corporation shall be dissolved or liquidated or shall no
longer perform the functions of a securities rating agency, "MOODY'S" shall be
deemed to refer to any other nationally recognized securities rating agency
designated by the Trustee, at the written direction of the Issuer.
"NOTE FEES" means the fees, costs and expenses (excluding Costs of
Issuance), of the Trustee, the Delaware Trustee and any Eligible Lender Trustee,
Paying Agent, Authenticating Agent, Remarketing Agent, Tender Agent, Auction
Agent, Market Agent, Broker-Dealer, Counsel, Note Registrar, Accountant and
other consultants and professionals incurred by the Issuer in carrying out and
administering its powers, duties and functions under (a) the Eligible Lender
Trust Agreement, the Trust Agreement, the Guarantee Agreements, the Higher
Education Act or any requirement of the laws of the United States or any State,
as such powers, duties and functions relate to Financed Student Loans; (b) any
Swap Agreement or Credit Enhancement Facility (other than any amounts payable
thereunder which constitute Other Obligations); (c) any Remarketing Agreement,
Tender Agent Agreement, Auction Agent Agreement, Market Agent Agreement or
Broker-Dealer Agreement; and (d) this Indenture.
"NOTE REGISTER" means the register maintained by the Note Registrar
pursuant to Section 2.07 hereof.
"NOTE REGISTRAR" means the Trustee, or, if so designated pursuant to the
terms of a Supplemental Indenture, an Authenticating Agent, serving in such
capacity under the terms of this Indenture, unless and until an Issuer Order is
delivered to the Authenticating Agent and the Trustee directing that the
Authenticating Agent or the Trustee, as the case may be, become the Note
Registrar and the Authenticating Agent or the Trustee, as the case may be,
agrees to serve in such capacity hereunder.
"NOTEHOLDER" means the Holder of any Note.
"NOTES" means all notes, bonds or other obligations issued pursuant to this
Indenture in accordance with the provisions of Article II hereof.
"OPINION OF COUNSEL" shall mean (a) with respect to the Trust, one or more
written opinions of counsel who may, except as otherwise expressly provided in
the Indenture, be employees of or counsel to the Delaware Trustee, the Trust,
the Issuer Administrator or an Affiliate of the Issuer Administrator and who
shall be satisfactory to the Trustee, and which opinion or opinions shall be
addressed to the Trustee as Trustee, shall comply with any applicable
requirements of the TIA and shall be in form and substance satisfactory to the
Trustee; and (b) with respect to the Issuer Administrator or the Servicer, one
or more written opinions of counsel who may be an employee of or counsel to the
Issuer Administrator or the Servicer, which counsel shall be acceptable to the
Trustee and the Delaware Trustee.
"ORIGINATION LOAN CERTIFICATE" means a certificate signed by College Loan
Corporation, or its agents, and substantially in the form attached as Exhibit C
hereto.
"OTHER BENEFICIARY" means an Other Senior Beneficiary, an Other Subordinate
Beneficiary or an Other Junior Subordinate Beneficiary.
"OTHER JUNIOR SUBORDINATE BENEFICIARY" means a person who is a Junior
Subordinate Beneficiary other than as a result of ownership of Junior
Subordinate Notes.
"OTHER JUNIOR SUBORDINATE OBLIGATIONS" means the Issuer's obligations to
pay any amounts under any Junior Subordinate Swap Agreements and any Junior
Subordinate Credit Enhancement Facilities.
"OTHER OBLIGATIONS" means, collectively, Other Senior Obligations, Other
Subordinate Obligations and Other Junior Subordinate Obligations.
"OTHER SENIOR BENEFICIARY" means a Person who is a Senior Beneficiary other
than as a result of ownership of Senior Notes.
"OTHER SENIOR OBLIGATION" means the Issuer's obligations to pay any amounts
under any Senior Swap Agreements and any Senior Credit Enhancement Facilities.
"OTHER SUBORDINATE BENEFICIARY" means a Person who is a Subordinate
Beneficiary other than as a result of ownership of Subordinate Notes.
"OTHER SUBORDINATE OBLIGATION" means the Issuer's obligations to pay any
amounts under any Subordinate Swap Agreements and any Subordinate Credit
Enhancement Facilities.
"OUTSTANDING" (a) when used with respect to any Note, shall have the
construction given to such word in Sections 1.06, 2.07 and 9.01 hereof, i.e., a
Note shall not be Outstanding hereunder if such Note is at the time not deemed
to be Outstanding hereunder by reason of the operation and effect of Section
1.06, 2.07 or 9.01 hereof; and (b) when used with respect to any Other
Obligation, means all Other Obligations which have become, or may in the future
become, due and payable and which have not been paid or otherwise satisfied.
"PARTICIPANT" means a Person that has an account with DTC.
"PAYING AGENT" means the Trustee and any other commercial bank designated
herein or in accordance herewith as a place at which principal of, premium, if
any, or interest on any Note is payable.
"PERSON" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint stock company, trust,
incorporated organization or government or any agency or political subdivision
thereof.
"PREMIUM" means for each Eligible Loan acquired by the Issuer from a
Lender, the meaning set forth in a Supplemental Indenture.
"PREPAYMENT DATE," when used with respect to any Note, all or any portion
of the Principal Amount of which is to be prepaid prior to its Stated Maturity,
means the date fixed for such prepayment by or pursuant to this Indenture.
"PREPAYMENT PRICE," when used with respect to any Note to be prepaid, means
the price at which it is to be redeemed pursuant to this Indenture and the
Supplemental Indenture pursuant to which it has been issued.
"PRINCIPAL ACCOUNT" means the Account by that name created and established
by Section 4.01 hereof.
"PRINCIPAL AMOUNT" when used with respect to (a) a Note, means the original
principal amount of such Note less all payments previously made to the Holder
thereof in respect of principal; and (b) a Swap Agreement, shall have the
meaning set forth in the Supplemental Indenture relating to the Series of Notes
for which the Issuer entered into such Swap Agreement.
"PRINCIPAL BALANCE" when used with respect to a Student Loan, means the
unpaid principal amount thereof (including any unpaid capitalized interest
thereon that is authorized to be capitalized under the Higher Education Act) as
of a given date.
"PRINCIPAL OFFICE" means (a) when used with respect to the Trustee, the
office located at the address specified in Section 10.04 hereof, or such other
office as may, from time to time, be designated as such by the Trustee in
writing to the Issuer; (b) when used with respect to the Issuer, its executive
office located at the address specified in Section 10.04 hereof, or such other
office as may, from time to time, be designated as such by Issuer Order; and (c)
when used with respect to a Paying Agent (other than the Trustee), an
Authenticating Agent, the Note Registrar, a Tender Agent, a Remarketing Agent,
an Auction Agent, a Market Agent or a Broker-Dealer, such office as may, from
time to time, be designated as such in writing to the Trustee and the Issuer as
the location of its principal office for the performance of its duties as Paying
Agent, Authenticating Agent, Note Registrar, Tender Agent, Remarketing Agent,
Auction Agent, Market Agent or Broker-Dealer, as the case may be.
"PRINCIPAL PAYMENT DATE" means the Stated Maturity of principal of any
Serial Note and the Sinking Fund Payment Date for any Term Note.
"PUBLIC SECURITIES" means Notes that are being offered for sale by the
Issuer pursuant to a registration statement filed with the Securities and
Exchange Commission.
"RATING AGENCY" means (a) with respect to the Notes, any rating agency that
shall have an outstanding rating on any of the Notes pursuant to request by the
Issuer; and (b) with respect to Investment Securities, any rating agency that
shall have an outstanding rating on the applicable Investment Security.
"RATING AGENCY CONDITION" means, with respect to any action, that each of
the Rating Agencies shall have notified the Issuer and the Trustee in writing
that such action will not result in a reduction, qualification or withdrawal of
the then-current rating of any of the Notes.
"RATING CATEGORY" means one of the general rating categories of a Rating
Agency, without regard to any refinement or gradation of such rating category by
a numerical modifier or otherwise.
"REGULAR RECORD DATE" means, with respect to an Interest Payment Date for
any series of Notes, unless the Supplemental Indenture authorizing the issuance
of such series of Notes otherwise provides, the fifteenth day (whether or not a
Business Day) of the calendar month immediately preceding such Interest Payment
Date.
"REMAINING ACQUISITION AMOUNT" with respect to any series of Notes means
the excess, if any, of (a) the amount deposited into the Acquisition Fund on the
date of issuance of such series of Notes; over (b) the sum of all amounts
withdrawn from, or added to, the Acquisition Fund during the related Acquisition
Period.
"REMARKETING AGENT" means, with respect to any series of Notes, any
securities dealer designated as such with respect to such Notes pursuant to the
provisions of Section 7.19 hereof and its successor or successors and any
securities dealer at any time substituted in its place pursuant to this
Indenture.
"REMARKETING AGREEMENT" means an agreement between a Remarketing Agent and
the Issuer setting forth the rights and obligations of the Remarketing Agent
acting in such capacity under this Indenture and otherwise meeting the
requirements of Section 7.20 hereof, including any supplement thereto or
amendment thereof entered into in accordance with the provisions thereof.
"RESERVE FUND" means the Reserve Fund created and established by Section
4.01 hereof.
"RESERVE FUND REQUIREMENT" with respect to any series of Notes shall have
the meaning set forth in the Supplemental Indenture authorizing the issuance of
such series of Notes. In calculating the Reserve Fund Requirement, all Notes to
be defeased by a series of refunding Notes shall be deemed not Outstanding as of
the date of calculation.
"RETIREMENT ACCOUNT" means the Account by that name created and established
by Section 4.01 hereof.
"REVOLVING PERIOD" with respect to any series of Notes shall have the
meaning set forth in the related Supplemental Indenture; provided however, that
so long as one or more series of Public Securities is outstanding the Revolving
Period shall not apply.
"S&P" means Standard & Poor's, a division of The McGraw-Hill Companies,
Inc., its successors and their assigns, and, if such corporation shall be
dissolved or liquidated or shall no longer perform the functions of a securities
rating agency, "S&P" shall be deemed to refer to any other nationally recognized
securities rating agency designated by the Trustee, at the written direction of
the Issuer.
"SECRETARY OF EDUCATION" means the Commissioner of Education, Department of
Health, Education and Welfare of the United States, and the Secretary of the
United States Department of Education (who succeeded to the functions of the
Commissioner of Education pursuant to the Department of Education Organization
Act), or any other officer, board, body, commission or agency succeeding to the
functions thereof under the Higher Education Act.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SECURITIES LEGEND" "THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR
REGISTERED OR QUALIFIED UNDER ANY STATE SECURITIES OR BLUE SKY LAW OF ANY STATE.
THE HOLDER HEREOF, BY PURCHASING THIS NOTE, AGREES THAT THIS NOTE MAY BE
REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN COMPLIANCE WITH THE
SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY (a) (i) PURSUANT TO RULE 144A
UNDER THE SECURITIES ACT ("RULE 144A") TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A (A
"QIB"), PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A; OR (b) TO AN
INSTITUTIONAL "ACCREDITED INVESTOR" (WITHIN THE MEANING OF RULE 501(a)(1)-(3) OR
(7) UNDER THE SECURITIES ACT) PURCHASING FOR INVESTMENT AND NOT FOR DISTRIBUTION
IN VIOLATION OF THE SECURITIES ACT, SUBJECT TO THE RECEIPT BY THE TRUSTEE OF
SUCH EVIDENCE ACCEPTABLE TO THE TRUSTEE THAT SUCH REOFFER, RESALE, PLEDGE OR
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS;
(ii) PURSUANT TO ANOTHER EXEMPTION AVAILABLE UNDER THE SECURITIES ACT AND IN
ACCORDANCE WITH ANY APPLICABLE STATE SECURITIES LAWS; OR (iii) PURSUANT TO A
VALID REGISTRATION STATEMENT."
"SENIOR ASSET PERCENTAGE" means, as of the date of determination, the
percentage resulting by dividing (a) the difference of the Aggregate Value less
the sum of (i) all accrued interest on Outstanding Senior Notes, (ii) all
accrued Issuer Swap Payments with respect to Senior Swap Agreements, and (iii)
all accrued fees with respect to Senior Credit Enhancement Facilities by (b) the
aggregate Principal Amount of Outstanding Senior Notes.
"SENIOR ASSET REQUIREMENT" means, at any time, any requirement set forth as
such in a Supplemental Indenture providing for the issuance of one or more
series of Notes any of which are then Outstanding.
"SENIOR BENEFICIARIES" means (a) the Holders of any Outstanding Senior
Notes and (b) any Other Senior Beneficiary holding any Other Senior Obligation
that is Outstanding.
"SENIOR CREDIT ENHANCEMENT FACILITY" means a Credit Enhancement Facility
designated as a Senior Credit Enhancement Facility in the Supplemental Indenture
pursuant to which such Credit Enhancement Facility is furnished by the Issuer.
"SENIOR CREDIT FACILITY PROVIDER" means any Person who provides a Senior
Credit Enhancement Facility.
"SENIOR NOTES" means any Notes designated in a Supplemental Indenture as
Senior Notes, which are secured under this Indenture on a basis senior to any
Subordinate Obligations and any Junior Subordinate Obligations (as such
seniority is described herein), and on a parity with Other Senior Obligations.
"SENIOR OBLIGATIONS" means, collectively, the Senior Notes and any Other
Senior Obligations.
"SENIOR SWAP AGREEMENT" means a Swap Agreement designated as a Senior Swap
Agreement in the Supplemental Indenture pursuant to which such Swap Agreement is
furnished by the Issuer.
"SENIOR SWAP COUNTERPARTY" means any Person who provides a Senior Swap
Agreement.
"SERIAL NOTES" means all Notes other than Term Notes.
"SERVICER" means ACS Education Services, Inc. (formerly known as AFSA Data
Corporation), Great Lakes Educational Loan Services, Inc., Nelnet Loan Services,
Inc., Southwest Student Services Corporation, Pennsylvania Higher Education
Assistance Agency and, subject to a Rating Agency Condition, any other
organization with which the Issuer has (or the Issuer and the Eligible Lender
Trustee have), entered into a Servicing Agreement; in any case, so long as such
party acts as servicer of the Financed Student Loans.
"SERVICING AGREEMENT" means any agreement between the Issuer and any
Servicer (or among the Issuer, the Eligible Lender Trustee and any Servicer),
under which such Servicer agrees to act as the Issuer's agent in connection with
the administration and collection of Financed Student Loans in accordance with
this Indenture.
"SERVICING FEES" means any fees payable by the Issuer to (a) a Servicer in
respect of Financed Student Loans pursuant to the provisions of a Servicing
Agreement and (b) a collection agent in respect of Financed Student Loans in
default.
"SINKING FUND PAYMENT DATE" means the date on which any Term Note is to be
mandatorily redeemed pursuant to the applicable provisions of the Supplemental
Indenture providing for the issuance thereof and from funds allocated as
provided in Section 4.06(b) hereof, or, if not redeemed, the Stated Maturity
thereof.
"SPECIAL ALLOWANCE PAYMENTS" means special allowance payments authorized to
be made by the Secretary of Education by Section 438 of the Higher Education
Act, or similar allowances authorized from time to time by federal law or
regulation.
"SPECIAL RECORD DATE" means, with respect to the payment of any Defaulted
Interest, a date fixed by the Trustee pursuant to Section 2.02 hereof.
"SPONSOR" means College Loan LLC, a Delaware limited liability company, as
initial holder of the trust certificate under the Trust Agreement, and any
successor thereto or assignee thereof.
"STATED MATURITY" when used with respect to any Note or any installment of
interest thereon, means the date specified in such Note as the fixed date on
which principal of such Note or such installment of interest is due and payable.
"STUDENT LOAN" means a loan to a borrower for or in connection with
post-secondary education and related post-secondary education expenses.
"SUBORDINATE ASSET PERCENTAGE" means, as of the date of determination, the
percentage resulting by dividing (a) the difference of the Aggregate Value less
the sum of (i) all accrued interest on Outstanding Senior Notes and Outstanding
Subordinate Notes, (ii) all accrued Issuer Swap Payments (other than with
respect to Junior Subordinate Swap Agreements), and (iii) all accrued fees with
respect to Credit Enhancement Facilities (other than Junior Subordinate Credit
Enhancement Facilities) by (b) the aggregate Principal Amount of Outstanding
Senior Notes and Outstanding Subordinate Notes.
"SUBORDINATE ASSET REQUIREMENT" means, at any time, any requirement set
forth as such in a Supplemental Indenture providing for the issuance of one or
more series of Notes any of which are then Outstanding.
"SUBORDINATE BENEFICIARIES" means (a) the Holders of any Outstanding
Subordinate Notes and (b) any Other Subordinate Beneficiary holding any Other
Subordinate Obligation that is Outstanding.
"SUBORDINATE CREDIT ENHANCEMENT FACILITY" means a Credit Enhancement
Facility designated as a Subordinate Credit Enhancement Facility in the
Supplemental Indenture pursuant to which such Credit Enhancement Facility is
furnished by the Issuer.
"SUBORDINATE CREDIT FACILITY PROVIDER" means any Person who provides a
Subordinate Credit Enhancement Facility.
"SUBORDINATE NOTES" means any Notes designated in a Supplemental Indenture
as Subordinate Notes, which are secured under this Indenture on a basis
subordinate to any Senior Obligations (as such subordination is described
herein), on a basis senior to any Junior Subordinate Obligations (as such
subordination is herein described), and on a parity with Other Subordinate
Obligations.
"SUBORDINATE OBLIGATIONS" means, collectively, the Subordinate Notes and
any Other Subordinate Obligations.
"SUBORDINATE SWAP AGREEMENT" means a Swap Agreement designated as a
Subordinate Swap Agreement in the Supplemental Indenture pursuant to which such
Swap Agreement is furnished by the Issuer.
"SUBORDINATE SWAP COUNTERPARTY" means any Person who provides a Subordinate
Swap Agreement.
"SUPPLEMENTAL INDENTURE" means any amendment of or supplement to this
Indenture made in accordance with Article VIII hereof.
"SURPLUS FUND" means the Surplus Fund created and established by Section
4.01 hereof.
"SWAP AGREEMENT" means an interest rate or other hedge agreement between
the Issuer and a Swap Counterparty, as supplemented or amended from time to
time.
"SWAP COUNTERPARTY" means any Person with whom the Issuer shall, from time
to time, enter into a Swap Agreement.
"SWAP COUNTERPARTY GUARANTY" means a guarantee in favor of the Issuer given
in connection with the execution and delivery of a Swap Agreement under this
Indenture.
"TENDER AGENT" means, with respect to any series of Notes, any commercial
bank or banking association having trust powers or trust company designated as
such with respect to such Notes pursuant to the provisions of Section 7.18
hereof and its successor or successors and any other commercial bank or banking
association having trust powers or trust company at any time substituted in its
place pursuant to this Indenture.
"TENDER AGENT AGREEMENT" means an agreement among a Tender Agent, the
Trustee, the Issuer, any Remarketing Agent and/or any related Credit Facility
Provider setting forth the rights and obligations of the Tender Agent acting in
such capacity under this Indenture and otherwise meeting the requirements of
Section 7.18 hereof, including any supplement thereto or amendment thereof
entered into in accordance with the provisions thereof.
"TENDER DATE" means, with respect to any Note, a date on which such Note is
required to be tendered for purchase by or on behalf of the Issuer, or has been
tendered for purchase by or on behalf of the Issuer pursuant to a right given
the Holder or Beneficial Owner of such Note, in accordance with the provisions
in the Supplemental Indenture providing for the issuance thereof.
"TERM NOTES" means Notes the payment of the principal of which is provided
for from moneys credited to the Principal Account pursuant to Section 4.06(b)
hereof.
"TRUST" means the Issuer.
"TRUST AGREEMENT" means the Trust Agreement dated as of March 1, 2002
between the Delaware Trustee and the Sponsor, as the same may be amended from
time to time.
"TRUST ESTATE" means the Trust Estate as described in the Granting Clauses
hereof.
"TRUST FUNDS" means, in the aggregate, all of the Funds and Accounts.
"TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act of 1939, as
amended from time to time.
"TRUSTEE" means Deutsche Bank Trust Company Americas, as trustee under this
Indenture, and its successor or successors and any other corporation which may
at any time be substituted in its place pursuant to this Indenture.
"UNAMORTIZED PREMIUM" means for each Eligible Loan, the portion of the
related Premium that has not been amortized based upon an assumed average life
for such Eligible Loan of seven years or such lesser time period as set forth in
a Supplemental Indenture as set forth in a Supplemental Indenture.
"VALUE" means, on any calculation date when required under this Indenture,
the value of the Trust Estate calculated by the Issuer, in accordance with the
following:
(a) with respect to any Financed Eligible Loan, the Principal Balance
thereof, plus accrued interest and Special Allowance Payments thereon (or
with respect to a Financed Student Loan which is no longer an Eligible
Loan, zero);
(b) with respect to any funds of the Issuer on deposit in any
commercial bank or as to any banker's acceptance or repurchase agreement or
investment agreement, the amount thereof plus accrued interest thereon;
(c) with respect to any Investment Securities of an investment
company, the bid price, or the net asset value if there is no bid price, of
the shares as reported by the investment company;
(d) as to other investments, (i) the bid price published by a
nationally recognized pricing service; or (ii) if the bid and asked prices
thereof are published on a regular basis by Bloomberg Financial Markets
Commodities News (or, if not there, then in THE WALL STREET JOURNAL), the
average of the bid and asked prices for such investments so published on or
most recently prior to such time of determination plus accrued interest
thereon;
(e) as to investments the bid prices of which are not published by a
nationally recognized pricing service and the bid and asked prices of which
are not published on a regular basis by Bloomberg Financial Markets
Commodities News (or, if not there, then in THE WALL STREET JOURNAL) the
lower of the bid prices at such time of determination for such investments
by any two nationally recognized government securities dealers (selected by
the Issuer in its absolute discretion) at the time making a market in such
investments, plus accrued interest thereon; and
(f) any accrued but unpaid Swap Counterparty Payment, unless the Swap
Counterparty is in default of its obligations under the Swap Agreement.
"VARIABLE RATE NOTES" means Notes whose interest rate is not fixed but
varies on a periodic basis as specified in the Supplemental Indenture providing
for the issuance thereof.
SECTION 1.02. DEFINITIONS OF GENERAL TERMS. Unless the context shall
clearly indicate otherwise, or may otherwise require, in this Indenture the
terms "herein," "hereunder," "hereby," "hereto," "hereof" and any similar terms
refer to this Indenture as a whole and not to any particular article, section or
subdivision hereof.
Unless the context shall clearly indicate otherwise, or may otherwise
require, in this Indenture: (a) references to articles, sections and other
subdivisions, whether by number or letter or otherwise, are to the respective or
corresponding articles, sections or subdivisions of this Indenture as such
articles, sections or subdivisions may be amended from time to time; (b)
references to articles, chapters, subchapters and sections of the Statutes, or
to any public law or other statute of the United States or any section thereof,
are to the respective or corresponding chapters, subchapters, sections and
statutes as they may be amended from time to time; (c) the word "heretofore"
means before the date of execution of this Indenture, the word "now" means at
the date of execution of this Indenture, and the word "hereafter" means after
the date of execution of this Indenture; and (d) the word "or" is not exclusive.
SECTION 1.03. COMPUTATIONS. Unless the facts shall then be otherwise, all
computations required for the purposes of this Indenture shall be made on the
assumption that: (a) the principal of and interest on all Notes shall be paid as
and when the same become due; (b) all credits required by this Indenture to be
made to any Fund or Account shall be made in the amounts and at the times
required; (c) all Notes required by this Indenture to be paid from moneys
credited to the Note Principal Account shall be paid on the respective Sinking
Fund Payment Dates therefor in the amounts and at the times as required by this
Indenture; and (d) all Issuer Swap Payments and Counterparty Swap Payments
(unless the Swap Counterparty is then in default of its obligations under the
Swap Agreement) shall be paid when the same become due.
SECTION 1.04. COMPLIANCE CERTIFICATES AND OPINIONS, ETC. Except as
otherwise specifically provided in this Indenture, upon any application or
request by the Issuer to the Trustee to take any action under any provision of
this Indenture, the Issuer shall furnish to the Trustee an Issuer Certificate
stating that all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include:
(a) a statement that each signatory of such certificate or opinion has
read or has caused to be read such covenant or condition and the
definitions herein relating thereto;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is necessary to
enable such signatory to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(d) a statement as to whether, in the opinion of each such signatory,
such condition or covenant has been complied with.
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate of an Authorized Officer of the Issuer may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, Counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which such certificate of an Authorized Officer
is based are erroneous. Any such certificate of an Authorized Officer or opinion
of Counsel may be based, insofar as it relates to factual matters, upon a
certificate or opinion of, or representations by, an officer or officers of the
Servicer or the Issuer, stating that the information with respect to such
factual matters is in the possession of the Servicer or the Issuer, unless such
Counsel knows, or in the exercise of reasonable care should know, that the
certificate or opinion or representations with respect to such matters are
erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
Whenever in this Indenture, in connection with any application or
certificate or report to the Trustee, it is provided that the Issuer shall
deliver any document as a condition of the granting of such application, or as
evidence of the Issuer's compliance with any term hereof, it is intended that
the truth and accuracy, at the time of the granting of such application or at
the effective date of such certificate or report (as the case may be), of the
facts and opinions stated in such document shall in such case be conditions
precedent to the right of the Issuer to have such application granted or to the
sufficiency of such certificate or report. The foregoing shall not, however, be
construed to affect the Trustee's right to rely upon the truth and accuracy of
any statement or opinion contained in any such document as provided in Article
VII.
SECTION 1.05. EVIDENCE OF ACTION BY THE ISSUER. Except as otherwise
specifically provided in this Indenture, any request, direction, command, order,
notice, certificate or other instrument of, by or from the Issuer shall be
effective and binding upon the Issuer for the purposes of this Indenture if
signed by an Authorized Officer.
SECTION 1.06. EXCLUSION OF NOTES HELD BY OR FOR THE ISSUER OR AFFILIATES.
In determining whether the Holders of the requisite Principal Amount of Notes
Outstanding have given any request, demand, authorization, direction, notice,
consent or waiver hereunder, Notes owned by the Issuer, College Loan
Corporation, the Sponsor or any affiliate of any of the foregoing shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Notes which the
Trustee knows to be so owned shall be disregarded.
SECTION 1.07. EXHIBITS. Attached to and by reference made a part of this
Indenture are the following Exhibits:
(a) Exhibit A: Form of Eligible Loan Acquisition Certificate
(b) Exhibit B: Form of Origination Loan Certificate; and
(c) Exhibit C: Form of Acquisition Account Deposit Certificates.
ARTICLE II
THE NOTES AND OTHER OBLIGATIONS
SECTION 2.01. GENERAL TITLE. There is hereby created and established an
issue of Notes of the Issuer to be known and designated as "Student Loan
Asset-Backed Notes," which Notes may be issued in series as hereinafter
provided. With respect to the Notes of any particular series, the Issuer may
incorporate in or add to the general title of such Notes any words, letters or
figures designed to distinguish that series.
SECTION 2.02. GENERAL LIMITATIONS; ISSUABLE IN SERIES; PURPOSES AND
CONDITIONS FOR ISSUANCE; PAYMENT OF PRINCIPAL AND INTEREST. The aggregate
Principal Amount of Notes that may be authenticated and delivered and
Outstanding under this Indenture is not limited, except as may be limited by
law. The Notes may be issued in series as from time to time authorized by Issuer
Order.
Notes shall be issued only for the purposes of (a) providing funds for the
acquisition by the Issuer of Eligible Loans (including, for this purpose, the
acquisition under this Indenture of Eligible Loans previously purchased by the
Issuer or any affiliate of the Issuer from other available moneys of the Issuer
or such affiliate) or for the payment of guarantee or origination fees; (b)
refunding at or before their Stated Maturity any or all Outstanding Notes issued
for that purpose; (c) paying Servicing Fees, Administration Fees, Note Fees,
Costs of Issuance and capitalized interest on the Notes being issued; (d) making
deposits to the Reserve Fund; and (e) such other purposes relating to the
Issuer's loan programs as may be provided in a Supplemental Indenture.
The Notes, including the principal thereof, premium, if any, and interest
thereon and any Carry-Over Amounts (and accrued interest thereon) with respect
thereto, and Other Obligations are limited obligations of the Issuer, payable
solely from the revenues and assets of the Issuer pledged therefor under this
Indenture.
In the event a default occurs in the due and punctual payment of any
interest on any Note, interest shall be payable thereon to the extent permitted
by law on the overdue installment of interest, at the interest rate borne by the
Note in respect of which such interest is overdue.
The principal of and premium, if any, on the Notes, together with interest
payable on the Notes at the Maturity thereof if the date of such Maturity is
other than a regularly scheduled Interest Payment Date, shall, except as
hereinafter provided or as otherwise provided in a Supplemental Indenture, be
payable upon presentation and surrender of such Notes at the Principal Office of
the Trustee or, at the option of the Holder, at the Principal Office of a duly
appointed Paying Agent. Interest due on the Notes on each regularly scheduled
Interest Payment Date shall, except as hereinafter provided or as otherwise
provided in a Supplemental Indenture, be payable by check or draft drawn upon
the Trustee mailed to the Person who is the Holder thereof as of 5:00 p.m. on
the Regular Record Date relating thereto, at the address of such Holder as it
appears on the Note Register. Any interest not so timely paid or duly provided
for (herein referred to as "Defaulted Interest") shall cease to be payable to
the Person who is the Holder thereof at the close of business on the Regular
Record Date and shall be payable to the Person who is the Holder thereof at the
close of business on a Special Record Date for the payment of any such defaulted
interest. Such Special Record Date shall be fixed by the Trustee whenever moneys
become available for payment of the Defaulted Interest, and notice of the
Special Record Date shall be given to the Holders of the Notes not less than 10
days prior thereto by first-class mail to each such Holder as shown on the Note
Register on a date selected by the Trustee, stating the date of the Special
Record Date and the date fixed for the payment of such Defaulted Interest. All
payments of principal of, premium, if any, and interest on the Notes shall be
made in lawful money of the United States of America.
After the issuance of the Initial Notes, and from time to time, one or more
additional series of Notes may be issued upon compliance with the provisions of
Article II hereof (except where specifically indicated otherwise in this Section
2.02) in such Principal Amounts as may be determined by the Issuer for any of
the purposes hereinbefore specified in this Section 2.02 upon compliance with
the following conditions and any additional conditions specified in a
Supplemental Indenture:
(a) An Authorized Officer of the Issuer shall have certified (as
evidenced by an Issuer Certificate filed with the Trustee) that the Issuer
is not in default in the performance of any of its covenants and agreements
in this Indenture made (unless, in the opinion of Counsel, any such default
does not deprive any Beneficiary in any material respect of the security
afforded by this Indenture).
(b) The Rating Agency Condition shall have been satisfied with respect
to the issuance of such additional series of Notes.
(c) An opinion of Counsel to the Issuer to the effect that: (i) this
Indenture and such Supplemental Indenture have been duly authorized,
executed and delivered by the Issuer and, assuming due authorization,
execution and delivery by the other parties thereto, is valid and binding
upon the Issuer (subject to the operation of bankruptcy, insolvency,
preferential transfer, fraudulent transfer, fraudulent conveyance or other
laws relating to or affecting creditors rights generally, now existing or
hereafter enacted, and by the application of general principles of equity
including those relating to equitable subordination and judicial
discretion); (ii) pursuant to this Indenture the Issuer has assigned and
pledged, and all necessary action on the part of the Issuer has been taken
as required to assign and pledge under this Indenture, all of the Trust
Estate to the Trustee, subject to customary exceptions; (iii) upon the
execution, authentication and delivery thereof, such Notes will have been
duly and validly authorized and issued in accordance with the provisions of
this Indenture; (iv) such Notes are valid and binding obligations of the
Issuer; (v) the Notes will be classified as debt for federal income tax
purposes; (vi) the Issuer shall have acquired a perfected security interest
in all Financed Student Loans purchased or financed in favor of the Trustee
in the manner provided for by applicable law and the Higher Education Act;
and (vii) all conditions precedent to the issuance of such Notes have been
satisfied.
(d) A written order as to the delivery of such Notes, signed by an
Authorized Officer.
SECTION 2.03. TERMS OF PARTICULAR SERIES. Each series of Notes shall be
created by and issued pursuant to a Supplemental Indenture and such Supplemental
Indenture shall designate Notes of each series as Senior Notes, Subordinate
Notes or Junior Subordinate Notes. The Notes of each series shall bear such date
or dates, shall be payable at such place or places, shall have such Stated
Maturities and Sinking Fund Payment Dates, shall bear interest at such rate or
rates, from such date or dates, payable in such installments and on Interest
Payment Dates and at such place or places, may be subject to redemption at such
Prepayment Price or Prices and upon such terms, may be entitled to distributions
of principal upon such terms, may have such provisions for accrual of Carry-Over
Amounts (and interest thereon), payable in such installments and on Interest
Payment Dates and at such place or places, upon such terms as shall be provided
for in the Supplemental Indenture creating that series. The Supplemental
Indenture creating any series of Notes may contain a provision limiting the
aggregate Principal Amount of the Notes of that series or the aggregate
Principal Amount of Notes which may thereafter be issued.
All Notes of the same series shall be substantially identical in tenor and
effect, except as to denomination, the differences specified herein or in a
Supplemental Indenture between interest rates, Stated Maturities and redemption
and principal distribution provisions.
SECTION 2.04. FORM AND DENOMINATIONS. The Notes of each series and the
Trustee's or Authenticating Agent's certificate of authentication shall be in
substantially the forms set forth in the Supplemental Indenture providing for
the issuance thereof, with such appropriate insertions, omissions, substitutions
and other variations as are required or permitted by this Indenture or such
Supplemental Indenture, and may have such letters, numbers or other marks of
identification and such legends or endorsements placed thereon as may,
consistently herewith, be determined by the officers executing such Notes, as
evidenced by their signing of the Notes. Any portion of the text of any Note may
be set forth on the reverse thereof, with an appropriate reference thereto on
the face of the Note. The Notes of each series shall be distinguished from the
Notes of other series and Term Notes shall be distinguished from Serial Notes in
such manner as the Issuer may determine.
The Notes of any series may be issuable only as fully registered Notes.
The Notes of each series shall be issuable in such denominations as shall
be provided in the provisions of the Supplemental Indenture creating such
series.
SECTION 2.05. EXECUTION, AUTHENTICATION AND DELIVERY. The Notes shall be
executed on behalf of the Issuer by the Delaware Trustee, which signature may be
facsimiles.
Notes bearing the manual or facsimile signatures of individuals who were at
any time the proper officers of the Issuer shall bind the Issuer,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
At any time and from time to time after the execution and delivery of this
Indenture, the Issuer may deliver Notes executed by the Issuer to the Trustee or
an Authenticating Agent for authentication; and, upon Issuer Order, the Trustee
or the Authenticating Agent, as the case may be, shall authenticate and deliver
such Notes as in this Indenture provided and not otherwise.
No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for in the Supplemental
Indenture authorizing the issuance thereof executed by the Trustee or the
Authenticating Agent by manual signature of one of its authorized officers, and
such certificate upon any Note shall be conclusive evidence, and the only
evidence, that such Note has been duly authenticated and delivered hereunder.
SECTION 2.06. TEMPORARY NOTES. Pending the preparation of definitive Notes,
the Issuer may execute and, upon Issuer Order, the Trustee shall authenticate
and deliver, temporary Notes which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any denomination, substantially of the
tenor of the definitive Notes in lieu of which they are issued, in fully
registered form, without coupons, and with such appropriate insertions,
omissions, substitutions and other variations as the officers of the Issuer
executing such Notes may determine, as evidenced by their signing of such Notes.
If temporary Notes are issued, the Issuer will cause definitive Notes to be
prepared without unreasonable delay. After the preparation of definitive Notes,
the temporary Notes shall be exchangeable for definitive Notes upon surrender of
the temporary Notes at the Principal Office of the Trustee, without charge to
the Holder. Upon surrender for cancellation of any one or more temporary Notes,
the Issuer shall execute and the Trustee shall authenticate and deliver in
exchange therefor a like Principal Amount of definitive Notes of the same series
and Stated Maturity of authorized denominations. Until so exchanged the
temporary Notes shall in all respects be entitled to the same benefits under
this Indenture as definitive Notes.
SECTION 2.07. REGISTRATION, TRANSFER AND EXCHANGE. The Issuer shall cause
to be kept at the Principal Office of the Note Registrar a Note Register in
which, subject to such reasonable regulations as it may prescribe, the Issuer
shall provide for the registration of Notes and of transfers of Notes as herein
provided. The Issuer may, in a Supplemental Indenture, appoint an Authenticating
Agent for the purpose of receiving, authenticating and delivering Notes in
connection with transfers, exchanges and registrations as herein provided.
Unless an Authenticating Agent is designated to serve in such capacity pursuant
to a Supplemental Indenture or is otherwise directed, and agrees, to so serve in
accordance with an Issuer Order, the Trustee shall be Note Registrar for the
purpose of registering Notes and transfer of Notes as herein provided. At
reasonable times and under reasonable regulations established by the Note
Registrar, the Note Register may be inspected and copied by the Issuer or by the
Holders (or a designated representative thereof) of 10% or more in Principal
Amount of Notes then Outstanding.
The Trustee and any Authenticating Agent shall adhere, with respect to
transfer of Notes, to the standards for efficiency in transfer agent performance
established in Securities and Exchange Commission Rules 17Ad-2 through 17Ad-7
under the Exchange Act, most particularly Rule 17Ad-2, which requires that
registered transfer agents process at least 90% of routine items (such as
certificates presented for transfer) received during any month within three
business days of their receipt.
Upon surrender for transfer or exchange of any Note at the Principal Office
of the Note Registrar or at the Principal Office of any Authenticating Agent, or
on a Tender Date with respect to Notes which are required to be tendered for
purchase, whether or not surrendered on such date, the Issuer shall execute, and
the Trustee or the Authenticating Agent, as the case may be, shall authenticate
and deliver, in the name of the designated transferee or transferees, including
transferees designated by a Tender Agent with respect to Notes required to be
tendered for purchase, or in exchange for the Note surrendered, one or more new
fully registered Notes of any authorized denomination or denominations, of like
aggregate Principal Amount, of the same series, having the same Stated Maturity
and interest rate and bearing numbers not previously assigned.
All Notes executed, delivered and authenticated pursuant to the preceding
paragraph shall be registered in the name of the Holder presenting the Note for
exchange or the designated transferee, as the case may be, on the Note Register
on the date of such transfer or exchange.
All Notes surrendered upon any exchange or transfer provided for in this
Indenture shall be promptly canceled by the Trustee upon receipt thereof from
the Note Registrar or the Authenticating Agent, as the case may be, and
thereafter disposed of as directed by Issuer Order.
All Notes issued upon any transfer or exchange of Notes, including Notes
issued in lieu of Notes required to be tendered for purchase on a Tender Date,
whether or not surrendered, shall be the valid obligations of the Issuer
evidencing the same debt, and entitled to the same security and benefits under
this Indenture, as the Notes surrendered upon such transfer or exchange or in
lieu of which such Notes were issued.
Every Note presented or surrendered for transfer or exchange shall be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Note Registrar or the Authenticating Agent, as the case may
be, duly executed, by the Holder thereof or his, her or its attorney duly
authorized in writing, with such signature guaranteed by an "eligible guarantor
institution" meeting the requirements of the Note Registrar or the
Authenticating Agent, as the case may be, which requirements include membership
or participation in a "signature guarantee program" determined by the Note
Registrar or the Authenticating Agent, as the case may be, in accordance with
the Exchange Act, and such other documents as the Trustee may require.
The Issuer may require payment by the Noteholder of a sum sufficient to
cover any tax or other governmental charge that may be imposed in connection
with any transfer or exchange of Notes, other than exchanges upon a partial
redemption of, or distribution of principal with respect to, a Note not
involving any transfer. All other expenses incurred by the Issuer, the Trustee,
the Note Registrar or the Authenticating Agent in connection with any transfer
or exchange of Notes shall be paid by the Issuer.
Except in connection with a Tender Date, the Issuer shall not be required
to transfer any Note (a) during a period beginning at the opening of business 15
days before any selection of Notes of the same series for redemption and ending
at the close of business on the day of such selection, (b) selected for
redemption in whole or in part, (c) after receipt by the Tender Agent of a
properly completed demand for purchase of such Note in accordance with the
Supplemental Indenture pursuant to which it was issued and through the
corresponding Tender Date, or (d) on or after the date notice of a Tender Date
is given and through such Tender Date. In the event that a Note is transferred
in connection with a Tender Date either during the period referred to in clause
(a) or after being selected for redemption in whole or in part, the Note
Registrar or the Authenticating Agent, as appropriate, shall give written notice
to any transferee thereof that such Note may be, or has been, selected for
redemption, as the case may be.
The Book-Entry Notes (a) shall be delivered by the Issuer to the Depository
or, pursuant to the Depository's instructions, shall be delivered by the Issuer
on behalf of the Depository to and deposited with the DTC Custodian, and in each
case shall be registered in the name of Cede & Co. and (b) shall bear a legend
substantially to the following effect:
"Unless this Note is presented by an authorized representative of The
Depository Trust Company, a New York corporation ("DTC"), to the Note Registrar
or its agent for registration of transfer, exchange or payment, and any Note
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."
The Book-Entry Notes may be deposited with such other Depository as the
Issuer may from time to time designate, and shall bear such legend as may be
appropriate; provided that such successor Depository maintains a book-entry
system that qualifies to be treated as "registered form" under Section 163(f)(3)
of the Code.
The Issuer and the Trustee are hereby authorized to execute and deliver a
Letter of Representations with the Depository relating to the Notes of each
series.
With respect to Notes registered in the Note Register in the name of Cede &
Co., as nominee of the Depository, the Issuer and the Trustee shall have no
responsibility or obligation to Direct or Indirect Participants or beneficial
owners for which the Depository holds Notes from time to time as a Depository.
Without limiting the immediately preceding sentence, the Issuer and the Trustee
shall have no responsibility or obligation with respect to (a) the accuracy of
the records of the Depository, Cede & Co., or any Direct or Indirect Participant
with respect to the ownership interest in the Notes; (b) the delivery to any
Direct or Indirect Participant or any other Person, other than a registered
Holder of a Note; (c) the payment to any Direct or Indirect Participant or any
other Person, other than a registered Holder of a Note as shown in the Note
Register, of any amount with respect to any distribution of principal or
interest on the Notes; or (d) the making of book-entry transfers among
Participants of the Depository with respect to Notes registered in the Note
Register in the name of the nominee of the Depository. No Person other than a
registered Holder of a Note as shown in the Note Register shall receive a Note
evidencing such Note.
Upon delivery by the Depository to the Trustee of written notice to the
effect that the Depository has determined to substitute a new nominee in place
of Cede & Co., and subject to the provisions hereof with respect to the payment
of distributions by the mailing of checks or drafts to the registered Holders of
Notes appearing as registered Owners in the Note Register, the name "Cede & Co."
in this Indenture shall refer to such new nominee of the Depository.
In the event that (a) the Depository or the Issuer advises the Trustee in
writing that the Depository is no longer willing or able to discharge properly
its responsibilities as nominee and depository with respect to the Book-Entry
Notes and the Issuer is unable to locate a qualified successor; or (b) the
Issuer at its sole option elects to terminate the book-entry system through the
Depository, the Book-Entry Notes shall no longer be restricted to being
registered in the Note Register in the name of Cede & Co. (or a successor
nominee) as nominee of the Depository. At that time, the Issuer may determine
that the Book-Entry Notes shall be registered in the name of and deposited with
a successor depository operating a global book-entry system, as may be
acceptable to the Issuer, or such depository's agent or designee but, if the
Issuer does not select such alternative global book-entry system, then upon
surrender to the Note Registrar of the Book-Entry Notes by the Depository,
accompanied by the registration instructions from the Depository for
registration, the Trustee shall at the Issuer's expense authenticate Individual
Notes. Neither the Issuer nor the 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 Individual
Notes, the Trustee, the Note Registrar, the Issuer, any Paying Agent and the
Sponsor shall recognize the Holders of the Individual Notes as Noteholders
hereunder.
Notwithstanding any other provision of this Indenture to the contrary, so
long as any Book-Entry Notes are registered in the name of Cede & Co., as
nominee of the Depository, all distributions of principal and interest on such
Book-Entry Notes and all notices with respect to such Book-Entry Notes shall be
made and given, respectively, in the manner provided in the applicable Letter of
Representations.
Subject to the preceding paragraphs, upon surrender for registration of
transfer of any Note at the office of the Note Registrar and, upon satisfaction
of the conditions set forth below, the Issuer shall execute in the name of the
designated transferee or transferees, a new Note of the same Principal Amount
and dated the date of authentication by the Trustee. The Note Registrar, if not
the Trustee, shall notify the Trustee of any such transfer.
By acceptance of an Individual Note, whether upon original issuance or
subsequent transfer, each holder of such a Note acknowledges the restrictions on
the transfer of such Note set forth in the Securities Legend and agrees that it
will transfer such a Note only as provided herein.
No transfer of any Note shall be made unless such transfer is exempt from
the registration requirements of the Securities Act and any applicable state
securities laws or is made in accordance with said Act and laws. In the event of
any such transfer, unless such transfer is made in reliance upon Rule 144A under
the Securities Act, (a) the Trustee may require a written opinion of Counsel
(which may be in-house counsel) acceptable to and in form and substance
reasonably satisfactory to the Trustee that such transfer may be made pursuant
to an exemption, describing the applicable exemption and the basis therefor,
from said Act and laws or is being made pursuant to said Act and laws, which
opinion of Counsel shall not be an expense of the Trustee, the Issuer or the
Trust Estate; and (b) the Trustee shall require the transferee to execute a
transferee letter certifying to the Issuer and the Trustee the facts surrounding
such transfer, which transferee letter shall not be an expense of the Trustee,
the Issuer or the Trust Estate. The holder of a Note desiring to effect such
transfer shall, and does hereby agree to, indemnify the Trustee and the Issuer
against any liability that may result if the transfer is not so exempt or is not
made in accordance with such federal and state laws. None of the Issuer, the
Trustee or the Sponsor intends or is obligated to register or qualify any Note
under the Securities Act or any state securities laws.
Each Registered Owner and each transferee of a Note shall be deemed to
represent and warrant that either (a) it is not acquiring the Note directly or
indirectly for, or on behalf of, an ERISA plan or any entity whose underlying
assets are deemed to be plan assets of such ERISA plan; or (b) (i) the
acquisition and holding of the Notes will not result in a nonexempt prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code or similar
law and (ii) if the Notes are subsequently deemed to be "plan assets" pursuant
to the regulations set forth at 29 C.F.R. ss. 2510.3-101, it will promptly
dispose of the Notes.
SECTION 2.08. MUTILATED, DESTROYED, LOST AND STOLEN NOTES. If a mutilated
Note is surrendered to the Trustee or the Note Registrar, the Issuer shall
execute and the Trustee or any Authenticating Agent shall authenticate and
deliver in exchange therefor a new Note of the same series and of like tenor and
Principal Amount, Stated Maturity and interest rate, bearing a number not
contemporaneously outstanding. If the Issuer, the Note Registrar, any
Authenticating Agent and the Trustee receive evidence to their satisfaction of
the destruction, loss or theft of any Note, and there is delivered to the
Issuer, the Note Registrar, any Authenticating Agent and the Trustee such
security or indemnity as may be required by them to save each of them harmless,
then, in the absence of notice to the Issuer, the Note Registrar, any
Authenticating Agent or the Trustee that such Note has been acquired by a bona
fide purchaser, the Issuer shall execute and upon its request the Trustee or any
Authenticating Agent shall authenticate and deliver, in exchange for or in lieu
of such destroyed, lost or stolen Note, a new Note of the same series and of
like tenor, Principal Amount, Stated Maturity and interest rate.
In case any such mutilated, destroyed, lost or stolen Note has become or is
about to become due and payable, the Issuer in its discretion may, instead of
issuing a new Note, pay such Note.
Every new Note issued pursuant to this Section 2.08 in lieu of any
destroyed, lost or stolen Note shall constitute an original additional
contractual obligation of the Issuer, whether or not the destroyed, lost or
stolen Note shall be at any time enforceable by anyone, and shall be entitled to
all the benefits of this Indenture equally and proportionately with any and all
other Notes of such series duly issued and authenticated hereunder. Neither the
Issuer, the Trustee, the Note Registrar nor any Authenticating Agent shall be
required to treat both the original Note and any duplicate Note as being
Outstanding for the purpose of determining the Principal Amount of Notes which
may be issued hereunder or for the purpose of determining any percentage of
Notes Outstanding hereunder, but both the original and duplicate Note shall be
treated as one and the same.
Upon the issuance of any new Note under this Section 2.08, the Issuer may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Note Registrar, any Authenticating Agent and the
Trustee) connected therewith.
The provisions of this Section 2.08 are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Notes.
SECTION 2.09. INTEREST RIGHTS PRESERVED; DATING OF NOTES. Each Note
delivered under this Indenture upon transfer of or in exchange for or in lieu of
any other Note shall carry all the rights to interest accrued and unpaid, and to
accrue, which were carried by such other Note. Each Note shall bear an original
issue date as provided in the Supplemental Indenture authorizing the issuance of
the series of Notes of which such Note is a part and, upon the original delivery
of a series of Notes or an exchange or transfer of Notes pursuant to Section
2.07 hereof, the Trustee or the Authenticating Agent, as the case may be, shall
date each Note to be delivered as of the date of authentication thereof, except
as may be otherwise provided in a Supplemental Indenture with respect to Notes
of the series authorized to be issued thereby.
SECTION 2.10. PERSONS DEEMED HOLDERS. The Issuer, the Trustee, each
Authenticating Agent, each Paying Agent, each Note Registrar, each Tender Agent
and any other agent of the Issuer may treat the Person in whose name any
Registered Note is registered as the owner of such Note for the purpose of
receiving payment of principal of (and premium, if any), interest on and any
Carry-Over Amounts (and accrued interest thereon) with respect to such Note and
(except as may be provided in a Supplemental Indenture with respect to
Beneficial Ownership Interests) for all other purposes whatsoever, whether or
not such Note be overdue, and neither the Issuer, the Trustee, any
Authenticating Agent, any Paying Agent, any Note Registrar, any Tender Agent nor
any other agent of the Issuer shall be affected by notice to the contrary.
SECTION 2.11. CANCELLATION. All Notes surrendered for payment, redemption,
transfer or exchange, if surrendered to the Trustee, shall be promptly canceled
by it, and, if surrendered to any Person other than the Trustee, shall be
delivered to the Trustee and, if not already canceled, shall be promptly
canceled by it. The Issuer may at any time deliver to the Trustee for
cancellation any Notes previously authenticated and delivered hereunder, which
Notes so delivered shall be promptly canceled by the Trustee. All canceled Notes
held by the Trustee shall be disposed of as directed by an Issuer Order.
SECTION 2.12. CREDIT ENHANCEMENT FACILITIES AND SWAP AGREEMENTS. The Issuer
may from time to time, pursuant to a Supplemental Indenture, enter into or
obtain the benefit of any Credit Enhancement Facility with respect to any Notes
of any series or any Swap Agreement; provided that (a) the Rating Agency
Condition is satisfied with respect to any such Credit Enhancement Facility or
Swap Agreement and (b) any such Credit Enhancement Facility or Swap Agreement
satisfies any conditions specified in a prior Supplemental Indenture. Such Swap
Agreement and any Supplemental Indenture in connection therewith shall clearly
designate which payment provisions of the Swap Agreement are "amounts due in the
ordinary course" and which payments are "termination, indemnity or other similar
or extraordinary payments" as such terms are used herein, and the Trustee shall
be entitled to rely on such designations.
Notwithstanding anything in this Indenture to the contrary, (a) any
Supplemental Indenture authorizing the execution by the Issuer of a Swap
Agreement or Credit Enhancement Facility may include provisions with respect to
the application and use of all amounts to be paid thereunder; (b) no amounts
paid under any such Credit Enhancement Facility shall be part of the Trust
Estate except to the extent, if any, specifically provided in such Supplemental
Indenture and no Beneficiaries shall have any rights with respect to any such
amounts so paid except as may be specifically provided in such Supplemental
Indenture; (c) Notes of one or more series or any portions thereof may be
secured by a pledge of any or all amounts payable pursuant to such Credit
Enhancement Facility, in the manner and to the extent provided in such
Supplemental Indenture, and such Notes may be either Senior Notes or Subordinate
Notes for purposes hereof; and (d) except as otherwise provided in the
Supplemental Indenture pursuant to which such Credit Enhancement Facility is
obtained or such Swap Agreement is entered into, the Issuer's obligations under
any such Credit Enhancement Facility or Swap Agreement shall be limited
obligations, payable solely from the revenues and assets of the Issuer pledged
therefor under this Indenture.
ARTICLE III
PREPAYMENT OF NOTES
SECTION 3.01. RIGHT OF PREPAYMENT. The Notes of any series shall be subject
to redemption or principal distribution as provided in this Article III and in
the Supplemental Indenture creating such series. As used in this Article III and
elsewhere in this Indenture, references to "prepay" shall mean to make payments
of principal prior to Stated Maturity, and shall be deemed to include references
to "redeem" or "make distributions of principal with respect to," as
appropriate.
Notes which may be prepaid before their Stated Maturity shall be prepaid in
accordance with their terms, this Indenture and (except as otherwise provided
with respect to the Notes of any particular series by the provisions of the
Supplemental Indenture creating such series) in accordance with this Article
III.
SECTION 3.02. ELECTION TO PREPAY OR PURCHASE; NOTICE TO TRUSTEE; SENIOR
ASSET REQUIREMENT AND SUBORDINATE ASSET REQUIREMENT. The election of the Issuer
to prepay any Notes or cause any Notes then subject to prepayment to be
purchased by the Trustee (other than on a Tender Date) shall be evidenced by an
Issuer Order, received by the Trustee no later than ten Business Days prior to
the date on which notice of prepayment must be given in order to effect a
prepayment on the Prepayment Date established with respect to a series of Notes
in the Supplemental Indenture authorizing the issuance of the Notes of such
series, stating the Prepayment Date, the Principal Amount, the series of Notes,
and, if applicable, the Stated Maturity within a series, to be prepaid.
Notwithstanding any provision hereof to the contrary but apart from the
prepayment of Subordinate Notes which are no longer Outstanding by reason of
Section 9.01 hereof or the prepayment of Subordinate Notes on a Sinking Fund
Payment Date, no prepayment or purchase (other than on a Tender Date) of
Subordinate Notes by the Trustee shall be effected hereunder unless prior to the
Trustee giving notice of redemption, transferring moneys to the Retirement
Account to make a principal distribution or soliciting a purchase, as the case
may be, the Issuer furnishes the Trustee an Issuer Certificate to the effect
that, as of the date Subordinate Notes are to be selected for prepayment or
purchase or such determination to prepay is made, and after giving effect to
such prepayment or purchase, the Senior Asset Requirement will be met. Such
Subordinate Notes may be prepaid on the Prepayment Date or purchased on the
purchase date therefor if the foregoing conditions are met on the date such
Notes are selected for redemption or purchase or as of the date on which moneys
are transferred to the Retirement Account to make any distribution of principal
with respect to such Notes, whether or not such conditions are met on the
Prepayment Date or the date of purchase. Any election to prepay Notes of a
series may also be conditioned upon such additional requirements as may be set
forth in the Supplemental Indenture authorizing the issuance of such Notes.
Notwithstanding any provision hereof to the contrary but apart from the
prepayment of Junior Subordinate Notes which are no longer Outstanding by reason
of Section 9.01 hereof or the prepayment of Junior Subordinate Notes on a
Sinking Fund Payment Date, no prepayment or purchase (other than on a Tender
Date) of Junior Subordinate Notes by the Trustee shall be effected hereunder
unless prior to the Trustee giving notice of redemption, transferring moneys to
the Retirement Account to make a principal distribution or soliciting a
purchase, as the case may be, the Issuer furnishes the Trustee an Issuer
Certificate to the effect that, as of the date Junior Subordinate Notes are to
be selected for prepayment or purchase or such determination to prepay is made,
and after giving effect to such prepayment or purchase, both the Senior Asset
Requirement and the Subordinate Asset Requirement will be met. Such Junior
Subordinate Notes may be prepaid on the Prepayment Date or purchased on the
purchase date therefor if the foregoing conditions are met on the date such
Notes are selected for redemption or purchase or as of the date on which moneys
are transferred to the Retirement Account to make any distribution of principal
with respect to such Notes, whether or not such conditions are met on the
Prepayment Date or the date of purchase. Any election to prepay Notes of a
series may also be conditioned upon such additional requirements as may be set
forth in the Supplemental Indenture authorizing the issuance of such Notes.
SECTION 3.03. SELECTION BY TRUSTEE OF NOTES TO BE PREPAID. Subject to
Section 3.02 hereof, Balances deposited to the credit of the Retirement Account
to provide for the payment of the Prepayment Price of Notes subject to mandatory
redemption, or required distributions of principal with respect to Notes, shall
be applied to the payment of Notes of all series subject to such prepayment (or
to the reimbursement of any Credit Facility Provider for such payment) in such
order of priority as may be established by the Supplemental Indentures pursuant
to which such Notes have been issued or, in the absence of direction from such
Supplemental Indentures, in the order of the Stated Maturities of such Notes,
and among Notes with the same Stated Maturity, in the order in which such Notes
were issued.
If less than all Notes of a series are to be prepaid, the Trustee at the
written direction of the Issuer shall select the particular Notes to be prepaid
as provided in the Supplemental Indenture providing for the issuance of such
Notes. The Trustee may provide for the selection for prepayment of portions of
the principal of Notes in the denomination larger than the smallest authorized
denomination of the Notes of that series or multiple thereof.
The Trustee shall promptly notify the Issuer and any Paying Agent in
writing of the Notes selected for prepayment and, in the case of any Note
selected for partial prepayment, the Principal Amount thereof to be prepaid.
For all purposes of this Indenture, unless the context otherwise requires,
all provisions relating to the prepayment of Notes shall relate, in the case of
any Note prepaid or to be prepaid only in part, to the portion of the principal
of such Note which has been or is to be prepaid.
SECTION 3.04. NOTICE OF PREPAYMENT. Notice of prepayment with respect to
any series of Notes shall be given by first-class mail, postage prepaid, mailed
by the date specified in the Supplemental Indenture creating such series to each
Holder of Notes to be prepaid at the address of such Holder appearing in the
Note Register; but neither failure to give such notice nor any defect in any
notice so given shall affect the validity of the proceedings for prepayment of
any Note not affected by such failure or defect.
All notices of prepayment shall state:
(a) the Prepayment Date;
(b) the Prepayment Price;
(c) the name (including series designation), Stated Maturity and CUSIP
numbers of the Notes to be prepaid, the Principal Amount of Notes of each
series to be prepaid, and, if less than all outstanding Notes of a series
are to be prepaid, the identification (and, in the case of partial
prepayment, the respective Principal Amounts) of the Notes of each series
to be prepaid;
(d) that, on the Prepayment Date, the Prepayment Price of and accrued
interest on each such Note will become due and payable and that interest on
each such Note shall cease to accrue on and after such date;
(e) the place or places where such Notes are to be surrendered for
payment of the Prepayment Price thereof and accrued interest thereon; and
(f) if it be the case, that such Notes are to be prepaid by the
application of certain specified trust moneys and for certain specified
reasons.
Within 60 days after any Prepayment Date, a second notice of prepayment
shall be given, in the manner described above, to the Holder of any Note that
was not presented for prepayment within 30 days after the Prepayment Date.
SECTION 3.05. NOTES PAYABLE ON PREPAYMENT DATE AND SINKING FUND PAYMENT
DATE. Notice of prepayment having been given as aforesaid, the Notes so to be
prepaid shall, on the Prepayment Date, become due and payable at the Prepayment
Price specified plus accrued interest thereon to the Prepayment Date and on and
after such date (unless the Issuer shall default in the payment of the
Prepayment Price and accrued interest) such Notes (or portions thereof) shall
cease to bear interest. Upon surrender of any such Note for redemption in
accordance with such notice, such Note shall be paid at the Prepayment Price
thereof plus (unless the Prepayment Date is a regularly scheduled Interest
Payment Date) accrued interest to the Prepayment Date. Installments of interest
whose Stated Maturity is on or prior to the Prepayment Date shall continue to be
payable to the applicable Noteholder.
If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the Prepayment Price and, to the extent lawful, interest
thereon shall, until paid, bear interest from the Prepayment Date at the rate
borne by the Note.
SECTION 3.06. NOTES PREPAID IN PART. Any Note which is to be redeemed only
in part shall (except as otherwise provided in the Supplemental Indenture
pursuant to which the Notes of such series were issued) be surrendered to the
Paying Agent (with, if the Paying Agent so requires, due endorsement by, or a
written instrument of transfer in form satisfactory to the Paying Agent duly
executed by, the Holder thereof or his, her or its attorney duly authorized in
writing) and the appropriate officers of the Issuer shall execute and the
Trustee or an Authenticating Agent shall authenticate and deliver to the Holder
of such Note, without service charge, a new Note or Notes of the same series, of
any authorized denomination or denominations, having the same Stated Maturity
and interest rate as requested by such Holder, in aggregate Principal Amount
equal to and in exchange for the unredeemed portion of the principal of the Note
so surrendered.
Any Note with respect to which a partial distribution of principal is made
shall remain Outstanding in the then current Principal Amount. The Trustee shall
retain a record of the Principal Amount of each Note any portion of the
principal of which has been distributed, and shall give the Note Registrar (if
other than the Trustee) prompt written notice of the current Principal Amount of
each such Note as of the end of each calendar month.
SECTION 3.07. PURCHASE OF NOTES. The Issuer may at any time, but subject to
Section 3.02 hereof, authorize and direct the Trustee to purchase Notes in the
open market out of any funds available for such purpose, such purchases to be
made at a price not in excess of the amount specified in this Indenture or, if
no amount is specified, the Principal Amount thereof plus accrued interest and
any applicable prepayment premium. In addition, the Issuer may, from time to
time, direct the Trustee to request the submission of tenders following
published notice requesting such submission prior to making the purchases
authorized pursuant to this Section 3.07. The Issuer may specify the maximum and
minimum period of time which shall transpire between the date upon which such
notice is to be given and the date upon which such tenders are to be accepted or
may authorize the Trustee to determine the same in its discretion. No tenders
shall be considered or accepted at any price exceeding the maximum price
specified by the Issuer for the purchase of Notes. The Trustee shall accept bids
with the lowest price and, in the event the moneys available for purchase
pursuant to such tenders are not sufficient to permit acceptance of all tenders
and if there shall be tenders at an equal price above the amounts of moneys
available for purchase, then the Trustee shall, determine in its discretion, the
Notes tendered which shall be purchased. Prior to such acceptance and purchase
the Issuer shall approve the Trustee's determination above. All Notes purchased
by the Trustee pursuant to this Section 3.07 shall be canceled and not reissued.
ARTICLE IV
CREATION OF FUNDS AND ACCOUNTS;
CREDITS THERETO AND PAYMENTS THEREFROM
SECTION 4.01. CREATION OF FUNDS AND ACCOUNTS. There are hereby created and
established the following Funds and Accounts to be held by the Trustee and
maintained in accordance with the provisions of this Indenture:
(a) an Acquisition Fund;
(b) an Administration Fund;
(c) a Reserve Fund;
(d) a Collection Fund;
(e) a Debt Service Fund, within which there shall be an Interest
Account, a Principal Account and a Retirement Account; and
(f) a Surplus Fund.
The Supplemental Indenture for any series of Notes may provide for the
creation of additional Funds, separate Accounts within any Fund or separate
subaccounts within any Account, into which moneys representing proceeds of such
series, moneys set aside for the payment of such series, or moneys otherwise
allocable to such series shall be deposited or credited. Notwithstanding the
creation of such Accounts or subaccounts, moneys therein shall (except as
provided in this Section 4.01 with respect to amounts paid pursuant to a Credit
Enhancement Facility and amounts set aside in an Escrow Account as hereinafter
defined) be available for any purpose for which other moneys in the Fund of
which such Account is a part or the Account of which such subaccount is a part,
as the case may be, are authorized to be applied or used.
Any Supplemental Indenture providing for the issuance of any series of
Notes, the payment of which is to be provided pursuant to or secured by a Credit
Enhancement Facility, shall also provide for the creation of separate
subaccounts within the Interest Account, the Principal Account and the
Retirement Account. Any payment received pursuant to such Credit Enhancement
Facility shall be deposited into such subaccounts, and moneys deposited therein
shall be used only for the payment of Debt Service on Notes of such series, or
for such other purposes as may be permitted by such Supplemental Indenture, upon
the conditions set forth in such Supplemental Indenture.
Any Supplemental Indenture providing for the issuance of any series of
Notes which (or the Beneficial Ownership Interests in which) must, upon the
occurrence of certain circumstances, or may, at the option of the Holder or
Beneficial Owner, be tendered for purchase by or on behalf of the Issuer shall
also provide for the creation of a separate Fund for such purpose. Any payment
received from any source provided for in accordance with the provisions in the
Supplemental Indenture (including proceeds of remarketing of such Notes or
Beneficial Ownership Interests, amounts provided pursuant to a Credit
Enhancement Facility which provides liquidity for the payment of such purchase
price, or amounts received from other sources) shall be deposited into such
Fund, and moneys deposited therein shall be used only for the payment of the
purchase price of Notes of such series (or the Beneficial Ownership Interests
therein) on a Tender Date, or for such other purposes as may be permitted by
such Supplemental Indenture (including reimbursement of the Credit Facility
Provider for the payment of such purchase price).
In addition, a Supplemental Indenture may provide for the creation of one
or more Escrow Accounts (each, an "Escrow Account") within the Debt Service
Fund, upon the defeasance of Notes pursuant to Section 9.01. Moneys deposited in
any Escrow Account shall be used only for the payment of the Notes with respect
to which the Escrow Account was established.
No interest shall be paid by the Trustee on moneys on deposit in the Funds
and Accounts established pursuant to this Indenture. Moneys on deposit in such
Funds and Accounts shall be invested in accordance with Section 4.10 hereof.
SECTION 4.02. ACQUISITION FUND. With respect to each series of Notes, the
Trustee shall, upon delivery to the initial purchasers thereof and from the
proceeds thereof, credit to the Acquisition Fund the amount, if any, specified
in the Supplemental Indenture providing for the issuance of such series of
Notes. The Trustee shall also deposit in the Acquisition Fund: (a) any funds to
be transferred thereto from the Collection Fund as provided in Section 4.05
hereof, or from the Surplus Fund as provided in Section 4.07 hereof; and (b) any
other amounts specified in a Supplemental Indenture to be deposited therein.
Balances in the Acquisition Fund shall be used only for (a) the acquisition
of Eligible Loans including the payment of any related Premium and origination
and guarantee fees, if any, and any related Add-On Loan; (b) the redemption or
purchase of, or distribution of principal with respect to, Notes as provided in
a Supplemental Indenture providing for the issuance of such Notes; (c) the
payment of Debt Service on the Notes and Other Obligations when due (upon
transfer to the Debt Service Fund as set forth below in this Section 4.02); (d)
following the Acquisition Period, the deposit of amounts into the Surplus Fund;
(e) the deposit of amounts into the Administration Fund to pay Administration
Fees, Servicing Fees and Note Fees; or (f) such other purposes related to the
Issuer's loan programs as may be provided in the Supplemental Indenture
authorizing a series of Notes. The Trustee shall make payments from the
Acquisition Fund to Lenders for the acquisition of Eligible Loans, including all
related Premiums and origination and guarantee fees, if any, in connection
therewith, and any related Add-On Loan, upon receipt by the Trustee of an
Eligible Loan Acquisition Certificate and all documents and certificates
required thereby. Notwithstanding the foregoing, the Issuer shall not pay any
Premium except as permitted by a Supplemental Indenture.
If, on any Monthly Calculation Date, the Balance in the Acquisition Fund
available for such purpose is less than the amount set forth in an Issuer
Certificate as the amount expected to be needed to pay such origination fees,
guarantee fees, related premiums and other fees due in the next month, the
Trustee shall transfer upon written direction of the Issuer to the Acquisition
Fund an amount equal to such deficiency from the following Funds in the
following order of priority: the Collection Fund and the Surplus Fund.
Balances in the Acquisition Fund (other than any portion of such Balance
consisting of Financed Student Loans) shall be transferred to the credit of the
Debt Service Fund on the Monthly Calculation Date of each calendar month to the
extent required to provide for the payment of the Debt Service on the Notes and
any Other Obligations, all as provided in Section 4.06 hereof. In connection
with the transfer contemplated in the preceding sentence, to the extent that the
Trustee does not receive timely transfer instructions from the Issuer, the
Trustee shall use its reasonable best efforts to effectuate such transfer
without further authorization or direction. If any amounts have been transferred
to the Debt Service Fund pursuant to this paragraph, the Trustee shall, to the
extent necessary to cure the deficiency in the Acquisition Fund as a result of
such transfer or transfers, transfer to the Acquisition Fund amounts from the
Collection Fund as provided in Section 4.05 hereof.
On the first Monthly Calculation Date following the end of the Acquisition
Period relating to a series of Notes, the Trustee shall transfer from the
Acquisition Fund to the Retirement Account of the Debt Service Fund, for the
redemption of, or distribution of principal with respect to, Notes, an amount
equal to the Remaining Acquisition Amount.
The Principal Balance of Financed Student Loans in the Acquisition Fund
shall be included in the Balance of the Acquisition Fund until such Financed
Student Loans shall have been paid in full or sold or exchanged as herein
provided. Interest and principal payments, including Guarantee payments, and
Special Allowance Payments received with respect to Financed Student Loans
(excluding, except as otherwise provided in a Supplemental Indenture, any
federal interest subsidy payments and Special Allowance Payments that accrued
prior to the date on which such Student Loans were Financed) and proceeds from
the sale or other conveyance of Financed Student Loans shall be credited to the
Collection Fund as provided in Section 4.05 hereof.
Except as otherwise set forth in a Supplemental Indenture and except for
assignment of Financed Eligible Loans to a Guarantee Agency for claims payment,
the Issuer may direct the Trustee to sell one or more Student Loans Financed
with moneys in the Acquisition Fund only upon compliance with the following: (a)
in exchange for one or more Eligible Loans (of approximately the same aggregate
Principal Balance and accrued borrower interest as such Financed Student Loans)
which (i) evidence the additional obligations of borrowers whose Student Loans
have been previously Financed hereunder; or (ii) are to be substituted for
Financed Student Loans which are not Eligible Loans (except that no sale shall
be made pursuant to clause (a) to the Sponsor or an affiliate of the Sponsor
except to remedy a breach of representation in the Loan Purchase Agreement); or
(b) to an affiliate of the Issuer (but not to College Loan Corporation or any
other party that has sold such Financed Student Loans to the Issuer) at a price
equal to or greater than the Principal Balance of such Student Loan as of the
sale date, plus any Unamortized Premium and borrower accrued interest; provided
that prior to any such sale and exchange pursuant to (a) the Trustee shall have
received an Eligible Loan Acquisition Certificate and all documents and
certifications required thereby with respect to all Eligible Loans to be so
transferred pursuant to this Indenture in exchange, together with (i) in the
case of Eligible Loans referred to in the preceding clause (a)(i), an Issuer
Certificate certifying that such sale and exchange will not materially adversely
affect the Issuer's ability to pay Debt Service on the Outstanding Notes and
Outstanding Other Obligations, Carry-Over Amounts (including accrued interest
thereon) with respect to Outstanding Notes, Servicing Fees, Administration Fees
or Note Fees; and (ii) a written instrument satisfactory to the Trustee
assigning all right, title, interest and privilege of the Issuer in, to and
under the student loan purchase agreement pursuant to which each such Eligible
Loan to be transferred to this Indenture was acquired by the Issuer (or by the
Eligible Lender Trustee on behalf of the Issuer), to the extent such right,
title, interest and privilege relate to such Eligible Loan; and provided further
that in the case of the sale of any such Financed Student Loans pursuant to (b)
above and prior to such sale, the Issuer shall also (A) certify to the Trustee
that the proceeds of such sale will be deposited in the Collection Fund and will
be used to redeem Notes within the next 60 days pursuant to Section 4.05(m) and
(B) provide the Trustee with a bring-down of the "true sale" opinion rendered in
connection with the original issuance of the Notes under this Indenture. Within
60 days following the acquisition of any Eligible Loans pursuant to (a) above,
the Issuer shall have a Servicer or other independent agent of the Issuer verify
that a sampling of such Eligible Loans acquired with the proceeds of such loan
sale comply with the Act and the Issuer shall receive a bring down of the "true
sale" opinion rendered in connection with the original issuance of any Notes
under the Indenture. Any money received by the Issuer in connection with a sale
and exchange of Financed Student Loans pursuant to this paragraph, including
those moneys representing the excess of the aggregate Principal Balance of and
accrued borrower interest on such Financed Student Loans released from this
Indenture over the aggregate Principal Balance of and accrued borrower interest
on the Eligible Loans transferred to this Indenture in exchange therefor, shall
be deposited to the credit of the Collection Fund in accordance with the
preceding paragraph (except, in the case of sales pursuant to (b) above in which
case all such sale proceeds shall be used to redeem Notes). Any such Eligible
Loans so transferred to this Indenture in exchange for Student Loans previously
Financed from the Acquisition Fund shall, for all purposes of this Indenture, be
deemed to have been Financed with moneys in the Acquisition Fund and shall be
credited to the Acquisition Fund and included in the Balance thereof.
In order to facilitate the acquisition of Eligible Loans being originated
by College Loan Corporation, the Issuer may instruct the Trustee to establish an
Account or Accounts within the Acquisition Fund pursuant to the terms and
provisions of an Acquisition Account Agreement which permits the purchase price
for one or more Eligible Loans to be withdrawn from such Account by College Loan
Corporation, or its agent, upon receipt by the Originating Agent (as defined in
the Acquisition Account Agreement), as custodian for the Trustee, of the
documentation evidencing the Eligible Loans to be purchased. Moneys in the
Acquisition Fund may be transferred upon written direction of the Issuer to an
Account established pursuant to an Acquisition Account Agreement upon receipt by
the Trustee of an Acquisition Account Deposit Certificate. Once deposited to an
Account established pursuant to the terms and provisions of an Acquisition
Account Agreement, moneys within such Account may be disbursed by the Trustee
for the acquisition of one or more Eligible Loans upon receipt by the Trustee of
a Originated Loan Certificate and all documents and certificates required
thereby.
Pending application of moneys in the Acquisition Fund, such moneys shall be
invested in Investment Securities, as provided in Section 4.10 hereof, and any
earnings on or income from such investments shall be deposited in the Collection
Fund as provided in Section 4.05 hereof.
SECTION 4.03. ADMINISTRATION FUND. With respect to each series of Notes,
the Trustee shall, upon delivery thereof and from the proceeds thereof, credit
to the Administration Fund the amount, if any, specified in the Supplemental
Indenture providing for the issuance of such series of Notes. The Trustee shall
also credit to the Administration Fund all amounts transferred thereto from the
Collection Fund as provided in Section 4.05 hereof and the Surplus Fund as
provided in Section 4.07 hereof. Amounts in the Administration Fund shall be
used for the payment of Costs of Issuance, Servicing Fees, Administration Fees
and Note Fees as provided in this Section 4.03
On each Monthly Calculation Date, the Trustee shall transfer and credit to
the Administration Fund moneys available hereunder for transfer thereto in such
amounts and at such times as an Authorized Officer of the Issuer shall direct by
Issuer Order, for the payment of Servicing Fees, Administration Fees and Note
Fees due during the next month. Deposits to the credit of the Administration
Fund shall be made from the following sources in the following order of
priority: the Collection Fund to the extent and in the manner provided in
Section 4.05 hereof; and the Surplus Fund to the extent and in the manner
provided in Section 4.07 hereof.
Amounts in the Administration Fund may, subject to any limitations
specified in a Supplemental Indenture, be paid out for Servicing Fees,
Administration Fees or Note Fees at any time upon receipt of an Issuer Order and
shall be paid in the full amount designated therein. Amounts in the
Administration Fund may, as provided in a Supplemental Indenture pursuant to
which Notes are issued, be paid out for Costs of Issuance related to such Notes
upon receipt of an Issuer Order and shall be paid in the full amount designated
therein. Upon receipt by the Trustee of Issuer Orders directing the payment of
Note Fees or Costs of Issuance to designated payees in designated amounts for
stated services or, in the case of reimbursement of the Issuer for its payment
of such Note Fees or Costs of Issuance or the payment of Servicing Fees or
Administration Fees (to the extent permitted in this Section), to the Issuer,
and in each case certifying that such payment is authorized by this Indenture,
be used for and applied only to pay Servicing Fees, Administration Fees, Note
Fees and Costs of Issuance or to reimburse another fund, account or other source
of the Issuer for the previous payment of Administration Fees, Servicing Fees,
Note Fees or Costs of Issuance. Payments from the Administration Fund for such
purposes shall be made by check or wire transfer by the Trustee in accordance
with such Issuer Orders. Amounts in the Administration Fund in excess of amounts
needed to pay Servicing Fees, Administration Fees or Note Fees may, upon Issuer
Order, be transferred to the Collection Fund.
Pending application of moneys in the Administration Fund, the moneys
therein shall be invested in Investment Securities, as provided in Section 4.10
hereof, and any earnings on or income from such investments shall be deposited
in the Collection Fund as provided in Section 4.05 hereof.
SECTION 4.04. RESERVE FUND. Immediately upon the delivery of any series of
Notes, and from the proceeds thereof or, at the option of the Issuer, from any
amounts to be transferred thereto from the Surplus Fund pursuant to Section 4.07
hereof or from any other available moneys of the Issuer not otherwise credited
to or payable into any Fund or Account under this Indenture or otherwise subject
to the pledge and security interest created by this Indenture, the Trustee shall
credit to the Reserve Fund the amount, if any, specified in the Supplemental
Indenture providing for the issuance of that series of Notes, such that upon
issuance of such Notes, the Balance in the Reserve Fund shall not be less than
the Reserve Fund Requirement.
If on any Monthly Calculation Date the Balance in the Reserve Fund shall be
less than the Reserve Fund Requirement, the Trustee shall transfer and credit
thereto an amount equal to the deficiency from the following Funds and Accounts
in the following order of priority (to the extent not required for credit to the
Administration Fund, the Debt Service Fund or the Acquisition Fund): the
Collection Fund and the Surplus Fund.
The Balance in the Reserve Fund shall be used and applied solely for the
payment when due of Debt Service on the Notes and the Other Obligations and the
other purposes specified in Section 4.06 hereof. Amounts in the Reserve Fund
shall be transferred by the Trustee to the credit of the Debt Service Fund at
any time and to the extent that the Balance therein and the Balances available
for deposit to the credit thereof from the Collection Fund and the Surplus Fund
are insufficient to meet the requirements specified in Section 4.06 hereof for
deposit to the credit of the Debt Service Fund at such time; (provided, however,
that such amounts shall be applied in the following order: (a) to the payment of
interest on the Senior Notes and the payment of Other Senior Obligations payable
from the Interest Account, (b) to the payment of principal and the purchase
price of the Senior Notes and the payment of Other Senior Obligations payable
from the Principal Account, (c) to the payment of interest on the Subordinate
Notes and the payment of Other Subordinate Obligations payable from the Interest
Account and (d) to the payment of principal and the purchase price of the
Subordinate Notes and the payment of Other Subordinate Obligations payable from
the Principal Account.
On the Stated Maturity or any Prepayment Date of any Notes, amounts in the
Reserve Fund shall, upon Issuer Order, be applied to the payment at Maturity or
prepayment of all Outstanding Notes of a series, to the extent that such
application will not reduce the Balance of the Reserve Fund below the Reserve
Fund Requirement (calculated as though the Notes to be retired on such Stated
Maturity or Prepayment Date were not Outstanding as of the date of such
calculation), and, after giving effect to such payment or prepayment, the
conditions of Section 3.02 will be met. In addition, at any time when the
aggregate of the Balances in the Debt Service Fund, the Reserve Fund and the
Surplus Fund (exclusive of Financed Student Loans) equals an amount sufficient
to discharge and satisfy the obligations of the Issuer with respect to all of
the Outstanding Notes and Other Obligations, all in the manner described in
Section 9.01 hereof, said Balances shall, upon Issuer Order, be so applied.
Notwithstanding the foregoing, if on any Monthly Calculation Date the
Balance in the Reserve Fund exceeds the Reserve Fund Requirement, such excess
shall, upon Issuer Order, be transferred to the Collection Fund.
Pending application of moneys in the Reserve Fund, the moneys therein shall
be invested in Investment Securities as provided in Section 4.10 hereof, and any
earnings on or income from such investments shall be deposited in the Collection
Fund as provided in Section 4.05 hereof.
SECTION 4.05. COLLECTION FUND. The Trustee shall credit to the Collection
Fund: (a) all amounts received as interest, including federal interest subsidy
payments, late fees and principal payments with respect to Financed Student
Loans, including all Guarantee payments, and all Special Allowance Payments with
respect to Financed Student Loans (excluding, unless otherwise provided in a
Supplemental Indenture, any federal interest subsidy payments and Special
Allowance Payments that accrued prior to the date on which such Student Loans
were Financed as directed by the Issuer in writing or as set forth in a report
of a Servicer provided to the Trustee); (b) unless otherwise provided in a
Supplemental Indenture, proceeds of any sale of any Financed Student Loans as
permitted by Section 4.02; (c) amounts transferred thereto from the Acquisition
Fund as provided in Section 4.02, from the Administration Fund as provided in
Section 4.03, and from the Reserve Fund as provided in Section 4.04; (d) all
amounts received as earnings on or income from Investment Securities in the
Acquisition Fund, the Administration Fund, the Reserve Fund, the Collection
Fund, the Debt Service Fund and the Surplus Fund; and (e) all Counterparty Swap
Payments.
The Issuer shall cause all amounts required to be credited to the
Collection Fund, upon receipt by the Issuer or a Servicer, or any agent thereof,
as the case may be, to be forthwith transmitted to the Trustee for such credit.
On each Monthly Calculation Date, the Trustee shall transfer the moneys
received during the preceding month in the Collection Fund, as follows and in
the order set forth below (upon receipt of an Issuer Order not inconsistent
herewith):
(a) to make any payments required under a Joint Sharing Agreement;
(b) to make any payments due and payable by the Issuer to the U.S.
Department of Education related to the Financed Student Loans or any other
payment due and payable to a Guarantee Agency relating to its Guarantee of
Financed Student Loans;
(c) to the credit of the Administration Fund to the extent and in the
manner provided in Section 4.03 hereof;
(d) to the credit of the Interest Account to the extent and in the
manner provided in Section 4.06(a) hereof to provide for the payment of
interest on Senior Notes or Other Senior Obligations (except, with respect
to Senior Swap Agreements, only amounts due in the ordinary course and not
any termination, indemnity or other similar or extraordinary payment
without satisfaction of a Rating Agency Condition) payable therefrom;
(e) to the credit of the Principal Account to the extent and in the
manner provided in Section 4.06(b) hereof to provide for the payment of
principal of Senior Notes at their Stated Maturity or on a Sinking Fund
Payment Date, or the reimbursement of Senior Credit Facility Providers for
the payment of principal of the Notes;
(f) to the credit of the Interest Account to the extent and in the
manner provided in Section 4.06(a) hereof to provide for the payment of
interest on Subordinate Notes or Other Subordinate Obligations (except,
with respect to Subordinate Swap Agreements, only amounts due in the
ordinary course and not any termination, indemnity or other similar or
extraordinary payment without satisfaction of a Rating Agency Condition)
payable therefrom;
(g) to the credit of the Principal Account to the extent and in the
manner provided in Section 4.06(b) hereof to provide for the payment of
principal of Subordinate Notes at their Stated Maturity or on a Sinking
Fund Payment Date, or the reimbursement of Subordinate Credit Facility
Providers for the payment of principal of the Notes;
(h) to the credit of the Reserve Fund to the extent and in the manner
provided in Section 4.04 hereof;
(i) to the credit of the Interest Account to the extent and in the
manner provided in Section 4.06(a) hereof to provide for the payment of
interest on Junior Subordinate Notes or Other Junior Subordinate
Obligations (except, with respect to Junior Subordinate Swap Agreements,
only amounts due in the ordinary course and not any termination, indemnity
or other similar or extraordinary payment without satisfaction of a Rating
Agency Condition) payable therefrom;
(j) to the credit of the Principal Account to the extent and in the
manner provided in Section 4.06(b) hereof to provide for the payment of
principal of Junior Subordinate Notes at their Stated Maturity or on a
Sinking Fund Payment Date or the reimbursement of Junior Subordinate Credit
Facility Providers for the payment of principal of the Notes;
(k) to make such other payments or distributions as may be set forth
in a Supplemental Indenture upon satisfaction of a Rating Agency Condition;
(l) during the Revolving Period and at the option of the Issuer, to
the credit of the Acquisition Fund to acquire Eligible Loans and, within
180 days after the Revolving Period, at the option of the Issuer, to the
credit of the Acquisition Fund, an amount equal to any Add-On Loans
required to be funded under the Higher Education Act;
(m) to the credit of the Retirement Account, but only at the direction
of the Issuer, to the extent and in the manner provided in Section 4.06(c)
hereof for the redemption of, or distribution of principal with respect to,
Notes (or the reimbursement of Credit Facility Providers for the payment of
the Prepayment Price of the Notes);
(n) to the credit of the Interest Account to the extent and in the
manner provided in Section 4.06(a) for the payment of Carry-Over Amounts
(and interest thereon) with respect to the Senior Notes;
(o) (but only if the Senior Asset Percentage would be at least 100%
upon the application of such amounts), to the credit of the Interest
Account to the extent and in the manner provided in Section 4.06(a) for the
payment of Carry-Over Amounts (and interest thereon) with respect to the
Subordinate Notes;
(p) (but only if the Senior Asset Percentage and the Subordinate Asset
Percentage would be at least 100% upon the application of such amounts), to
the credit of the Interest Account to the extent and in the manner provided
in Section 4.06(a) for the payment of Carry-Over Amounts (and interest
thereon) with respect to the Junior Subordinate Notes;
(q) to the credit of the Interest Account for the payment of
termination, indemnity or other similar or extraordinary payments due under
Senior Swap Agreements;
(r) to the credit of the Interest Account for the payment of
termination, indemnity or other similar or extraordinary payments due under
Subordinate Swap Agreements;
(s) to the credit of the Interest Account for the payment of
termination, indemnity or other similar or extraordinary payments due under
Junior Subordinate Swap Agreements;
(t) to the Retirement Account of the Debt Service Fund, to provide for
the redemption of, or distribution of principal with respect to, Notes
until, after applying these amounts, the Asset Release Requirement shall be
satisfied; and
(u) to the credit of the Surplus Fund in the manner provided in
Section 4.07 hereof.
Pending application of moneys in the Collection Fund, such moneys shall be
invested in Investment Securities as provided in Section 4.10 hereof, and any
earnings on or income from such investments shall be retained therein.
SECTION 4.06. DEBT SERVICE FUND. The Debt Service Fund shall be used only
for the payment of principal of, premium, if any, and interest on the Notes, the
purchase price of the Notes to be purchased in accordance with Section 3.07
hereof, Other Obligations and Carry-Over Amounts (including any accrued interest
thereon).
(a) INTEREST ACCOUNT. With respect to each series of Notes, the
Trustee shall, upon delivery to the original purchasers thereof and from
the proceeds thereof, credit to the Interest Account the amount, if any,
specified in the Supplemental Indenture providing for the issuance of such
series of Notes. The Trustee shall also deposit in the Interest Account (i)
that portion of the proceeds from the sale of the Issuer's refunding bonds,
notes or other evidences of indebtedness, if any, to be used to pay
interest on the Notes; (ii) all payments under any Credit Enhancement
Facilities by Credit Facility Providers to be used to pay interest on
Notes; and (iii) all amounts required to be transferred thereto from the
Funds and Accounts specified in this Section 4.06(a).
With respect to each series of Notes on which interest is paid at
intervals of less than every 60 days, the Trustee shall deposit to the
credit of the Interest Account on each Monthly Calculation Date an amount
equal to the interest that will become payable on such Notes during the
following calendar month. With respect to each series of Notes on which
interest is paid at intervals of more than every 60 days, the Trustee shall
make equal monthly deposits to the credit of the Interest Account on each
Monthly Calculation Date preceding each Interest Payment Date, to aggregate
the full amount of such interest. With respect to Variable Rate Notes for
which any such amount cannot be determined on the Monthly Calculation Date,
the Trustee will make such deposit based upon assumptions set forth in the
Supplemental Indenture authorizing such Notes.
With respect to each Swap Agreement under which Issuer Swap Payments
are paid no less frequently than every 60 days, the Trustee shall deposit
to the credit of the Interest Account on each Monthly Calculation Date an
amount equal to the Issuer Swap Payments that will become payable under
such Swap Agreement during the following calendar month. With respect to
each Swap Agreement under which Issuer Swap Payments are paid less
frequently than every 60 days, the Trustee shall make equal monthly
deposits to the credit of the Interest Account on each Monthly Calculation
Date preceding each date on which such Issuer Swap Payments are due, to
aggregate the full amount of such Issuer Swap Payments. With respect to any
Swap Agreement for which any such amount cannot be determined on the
Monthly Calculation Date, the Trustee will make such deposit based upon
assumptions set forth in the Supplemental Indenture authorizing such Swap
Agreement.
With respect to each Credit Enhancement Facility under which fees or
premiums are due no less frequently than every 60 days, the Trustee shall
deposit to the credit of the Interest Account on each Monthly Calculation
Date an amount equal to the fees or premiums that will become payable under
such Credit Enhancement Facility during the following calendar month. With
respect to each Credit Enhancement Facility under which fees or premiums
are paid less frequently than every 60 days, the Trustee shall make equal
monthly deposits to the credit of the Interest Account on each Monthly
Calculation Date preceding each Interest Payment Date, to aggregate the
full amount of such fees or premiums.
In making the deposits required to be deposited and credited to the
Interest Account, all other deposits and credits otherwise made or required
to be made to the Interest Account shall, to the extent available for such
purpose, be taken into consideration and allowed for. Each deposit required
by this Section 4.06(a) to pay the foregoing amounts shall be made by
transfer from the following Funds and Accounts, in the following order of
priority: the Collection Fund, the Surplus Fund, the Reserve Fund and, as
to Senior Notes and Other Senior Obligations only, the Acquisition Fund
(other than that portion of the Balance thereof consisting of Financed
Student Loans).
On each Monthly Calculation Date, if any Carry-Over Amount (including
any accrued interest thereon) will be due and payable with respect to a
series of Notes during the next month, as provided in the related
Supplemental Indenture, the Trustee shall transfer to the Interest Account
(to the extent amounts are available therefor in the Collection Fund or the
Surplus Fund after taking into account all prior applications of moneys in
such Funds on such Monthly Calculation Date in accordance with Sections
4.05 and 4.07 hereof) an amount equal to such Carry-Over Amount (including
any accrued interest thereon) so due and payable.
The moneys in the Interest Account required for the payment of
interest on the Notes of any series (including, without limitation, the
payment of that portion of the purchase price of Notes purchased pursuant
to Section 4.06(b) or 4.06(c) hereof attributable to accrued interest
thereon), any Issuer Swap Payments or fees payable to a Credit Facility
Provider under a Credit Enhancement Facility or any Carry-Over Amount
(including any accrued interest thereon) shall be applied by the Trustee to
the payment of such interest or amounts when due without further
authorization or direction, except that the Issuer shall provide written
direction as to any Issuer Swap Payments or fees payable to a Credit
Facility Provider under a Credit Enhancement Facility.
Pending application of moneys in the Interest Account, such moneys
shall be invested in Investment Securities as provided in Section 4.10
hereof, and any earnings on or income from such investments shall be
deposited in the Collection Fund as provided in Section 4.05 hereof.
(b) PRINCIPAL ACCOUNT. With respect to each series of Notes, the
Trustee shall, upon delivery to the original purchasers thereof and from
the proceeds thereof, credit to the Principal Account the amount, if any,
representing premium on such Notes paid as part of the purchase price
thereof. The Trustee shall also deposit to the credit of Principal Account:
(i) that portion of the proceeds from the sale of the Issuer's bonds, notes
or other evidences of indebtedness, if any, to be used to pay principal of
the Notes on a Principal Payment Date; (ii) all payments under any Credit
Enhancement Facility to be used to pay principal of Notes; and (iii) all
amounts required to be transferred thereto from the Funds and Accounts
specified in this Section 4.06(b).
Each deposit required by this Section 4.06(b) to pay the foregoing
amounts shall be made by transfer from the following Funds, in the
following order of priority (after transfers therefrom to the Interest
Account required on the date of any such transfer): the Collection Fund,
the Surplus Fund, the Reserve Fund and, as to Senior Notes and Other Senior
Obligations only, the Acquisition Fund (other than that portion of the
Balance thereof consisting of Financed Student Loans).
The moneys in the Principal Account required for the payment of the
principal of Notes at the Stated Maturity thereof or on a Sinking Fund
Payment Date therefor (or for the reimbursement to any Credit Facility
Provider for the payment of such principal) shall be applied by the Trustee
to such payment when due without further authorization or direction.
Subject to Section 3.02 hereof, Balances in the Principal Account may
also be applied to the purchase of Notes at a purchase price (including any
brokerage or other charges) not to exceed the Principal Amount thereof plus
accrued interest, in accordance with the provisions of Section 3.07 hereof,
or to the redemption of or distribution of principal with respect to Notes
at a Prepayment Price not to exceed the Principal Amount thereof plus
accrued interest, upon transfer to the Retirement Account, as determined by
the Issuer at such time, provided the Trustee shall have first certified
that no deficiency exists at such time in the Debt Service Fund. Any such
purchase, redemption, or distribution of principal shall be limited to
those Notes whose Stated Maturity or Sinking Fund Payment Date is the next
succeeding Principal Payment Date. If any moneys credited to the Principal
Account for the retirement of the Term Notes are applied to the purchase or
redemption of, or distribution of principal with respect to, such Notes as
provided in this Section 4.06(b), the Principal Amount of such Notes to be
prepaid on the next respective Sinking Fund Payment Date shall be reduced
by the Principal Amount of the Notes so purchased, redeemed or distributed;
provided, however, that no Term Notes shall be so purchased during the
interval between the date on which notice of prepayment of said Notes on a
Sinking Fund Payment Date is given and the date of prepayment set forth in
such notice, unless the Notes so purchased are Notes called for prepayment
in such notice or are purchased from moneys other than those credited to
the Principal Account with respect to sinking fund installments.
All Notes retired by prepayment, purchase or payment at Stated
Maturity pursuant to this Section 4.06(b) shall be canceled and shall not
be reissued. The accrued interest to be paid on the prepayment, purchase or
payment at Stated Maturity of such Notes shall be paid from the Interest
Account.
Pending application of moneys in the Principal Account, such moneys
shall be invested in Investment Securities as provided in Section 4.10
hereof, and any earnings on or income from such investments shall be
deposited in the Collection Fund as provided in Section 4.06 hereof.
(c) RETIREMENT ACCOUNT. The Trustee shall deposit to the credit of the
Retirement Account (i) any amounts transferred thereto from the Acquisition
Fund, the Collection Fund, the Reserve Fund, the Surplus Fund or the
Principal Account to provide for the redemption or purchase of, or the
distribution of principal with respect to, Notes; (ii) that portion of the
proceeds from the sale of the Issuer's bonds, notes or other evidences of
indebtedness, if any, to be used to pay the principal or Prepayment Price
of Notes on a date other than the Stated Maturity thereof or a Sinking Fund
Payment Date therefor; (iii) that portion of the proceeds of the sale or
securitization of an Eligible Loan, if any, to be used to pay the principal
or Prepayment Price of Notes on a date other than the Stated Maturity
thereof or a Sinking Fund Payment Date thereof; and (iv) all payments made
by a Credit Facility Provider under a Credit Enhancement Facility to be
used to pay the principal or Prepayment Price of Notes payable from the
Retirement Account.
Subject to Section 3.02 hereof, all redemptions of and distributions of
principal with respect to Notes (other than at Stated Maturity or on a Sinking
Fund Payment Date), shall be made with moneys deposited to the credit of the
Retirement Account. Moneys in the Retirement Account shall also be used for the
reimbursement to any Credit Facility Provider for the payment of such amounts
pursuant to a Credit Enhancement Facility.
Subject to Section 3.02 hereof, Balances in the Retirement Account may also
be applied to the purchase of Notes at a purchase price (including any brokerage
or other charges) not to exceed the Principal Amount thereof plus accrued
interest plus any then applicable prepayment premium, in accordance with the
provisions of Section 3.07 hereof, as determined by the Issuer at such time;
provided the Trustee shall have first certified that no deficiency exists at
such time in the Debt Service Fund.
In the event that Notes are to be prepaid from the Retirement Account on a
date other than a regularly scheduled Interest Payment Date or are to be
purchased from Balances in the Retirement Account pursuant to the preceding
paragraph, accrued interest on such Notes shall be paid from the Interest
Account.
The moneys in the Retirement Account required for the payment of the
Prepayment Price of Notes to be redeemed, or required distributions or principal
with respect to Notes (or for the reimbursement to any Credit Facility Provider
for the payment of such amounts) shall be applied by the Trustee to such payment
when due without further authorization or direction.
Pending application of moneys in the Retirement Account, such moneys shall
be invested in Investment Securities as provided in Section 4.10 hereof, and any
earnings on or income from such investment shall be deposited in the Collection
Fund as provided in Section 4.06 hereof.
SECTION 4.07. SURPLUS FUND. On each Monthly Calculation Date, the Trustee
shall transfer from the Collection Fund to the Surplus Fund any amounts
permitted to be transferred to the Surplus Fund pursuant to Section 4.05 hereof.
The Trustee shall also credit to the Surplus Fund any amounts transferred from
the Acquisition Fund pursuant to Section 4.02.
At any time there is a deficiency in any of the other Funds or Accounts,
Balances in the Surplus Fund shall be transferred to such Funds or Accounts to
remedy such deficiency in the same order of priority as set forth in Section
4.06 hereof for the application of moneys in the Collection Fund.
Upon receipt by the Trustee of an Issuer Order directing such transfer,
Balances in the Surplus Fund may also be transferred to the Acquisition Fund for
the acquisition of Eligible Loans and as further authorized or limited in a
Supplemental Indenture.
Subject to Section 3.02 hereof, Balances in the Surplus Fund may also be
applied to any one or more of the following purposes at any time as determined
by the Issuer at such time, provided the Trustee shall have first certified that
no deficiencies exist at such time in the Administration Fund, the Debt Service
Fund or the Reserve Fund:
(a) transfer to the Retirement Account for the redemption or purchase
of, or the distribution of principal with respect to, Notes;
(b) the purchase of Notes in accordance with the provisions of Section
3.07 hereof; or
(c) transfer to the Acquisition Fund for the acquisition of Eligible
Loans pursuant to Section 4.02 hereof.
Any amounts in the Surplus Fund shall, upon Issuer Order, be released to
the Issuer free and clear of the lien of this Indenture or may be released free
and clear of the lien of this Indenture to make indemnity payments required
pursuant to the terms of a Servicing Agreement if, after taking into account any
such release and excluding, for these purposes only, from the calculation of
Aggregate Value, any Financed Student Loans which are not Eligible Loans, the
Asset Release Requirement will be met.
Pending application of moneys in the Surplus Fund, such moneys shall be
invested in Investment Securities as provided in Section 4.10 hereof, and any
earnings on or income from such investments shall be deposited in the Collection
Fund as provided in Section 4.05 hereof.
SECTION 4.08. TERMINATION. When no Notes remain Outstanding and no Other
Obligations are Outstanding, the Trustee shall transfer to the Issuer, or to the
order of the Issuer, the Balances in all Funds and Accounts if, and to the
extent that, such Balances are in excess of amounts needed to pay principal of,
premium, if any, and interest on, and any Carry-Over Amounts (and accrued
interest thereon) due and payable with respect to the Notes, to satisfy any
Other Obligations, and to pay the fees, compensation and expenses of the Trustee
and any Authenticating Agent, Note Registrar, Remarketing Agents, Tender Agents,
Auction Agents, Market Agents, Broker-Dealers, and Paying Agents. To the extent
that such Balances are needed to pay such amounts or fees, the Trustee shall
retain such Balances hereunder and pay such amounts or fees to the Persons to
whom such amounts are due and payable as provided hereunder. In the event that
any portion or all of the Balances in the Funds and Accounts payable to the
Issuer pursuant to this Section 4.08 consist of Investment Securities which are
payable solely to the Trustee and cannot be effectively transferred to the
Issuer, the Trustee shall continue to hold such Investment Securities under this
Indenture on behalf of the Issuer until such time as such securities can be
transferred to the Issuer or amounts payable thereunder received, whether by
acceleration at the option of the holder thereof, at maturity or otherwise, all
at the direction of an Authorized Officer of the Issuer.
SECTION 4.09. PLEDGE. The Notes, including the principal thereof, premium,
if any, and interest thereon and any Carry-Over Amounts (and accrued interest
thereon) with respect thereto, and Other Obligations shall be limited
obligations of the Issuer specifically secured as provided in the Granting
Clauses hereof. Financed Student Loans purchased with the proceeds of the
Issuer's bonds, notes or other obligations as described in Section 4.02 hereof,
or resold to a Lender pursuant to its repurchase obligation, or sold or
exchanged for Eligible Loans in accordance with the provisions of Section 4.02
hereof, shall, contemporaneously with receipt by the Trustee of the purchase
price thereof in freely transferable funds, including any Eligible Loans to be
received in exchange therefor, no longer be pledged to nor serve as security for
the principal of, premium, if any, and interest on and any Carry-Over Amounts
(and accrued interest thereon) with respect to the Notes or any Other
Obligations. Moneys paid out to the Issuer as provided in Section 4.03 hereof
for Costs of Issuance, Servicing Fees, Administration Fees, and reimbursement
for the prior payment of Note Fees, moneys released to the Issuer pursuant to
Section 4.07 hereof, and other moneys applied as herein provided shall, upon
such payment, release, or application, no longer be pledged to nor serve as
security for the principal of, premium, if any, and interest on and any
Carry-Over Amounts (and accrued interest thereon) with respect to the Notes or
any Other Obligations.
The Issuer pledges and agrees with the Beneficiaries that the Issuer will
not limit or alter its powers to fulfill the terms of any agreements made in
this Indenture or in any Notes or in any way impair the rights and remedies of
the Beneficiaries until the Notes, together with interest thereon, including
interest on any unpaid installments of interest, and all costs and expenses in
connection with any action or proceeding by or on behalf of the Holders and all
amounts owing to Other Beneficiaries, are fully met and discharged.
The Notes, including the principal thereof, premium, if any, and interest
thereon and any Carry-Over Amounts (and accrued interest thereon) with respect
thereto, and any Other Obligations shall be secured hereunder by the foregoing
pledge of the Financed Student Loans, revenues, securities and other moneys
hereby made, and by a lien thereon, subject to the priorities expressly provided
herein. The pledge in the Granting Clauses hereof shall constitute a prior and
paramount lien and charge on such Financed Student Loans, revenues, contract
rights, securities and other moneys from time to time held hereunder (subject
only to the valid exercise of the constitutional powers of the United States of
America, valid bankruptcy, insolvency, reorganization, moratorium and other laws
affecting creditors' rights, and to the provisions of this Indenture permitting
the application of such Financed Student Loans, revenues, securities and other
moneys for the purposes and on the terms and conditions hereof), over and ahead
of any claims (whether in tort, contract or otherwise irrespective of whether
the parties possessing such claims have notice of the foregoing pledges or
charges), encumbrances or obligations of any nature hereafter arising or
incurred, and over and ahead of all other indebtedness payable from or secured
by such revenues which may hereafter be created or incurred. The pledge of such
Financed Student Loans, revenues, securities and other moneys made herein and
hereby shall be valid and binding from the time of the delivery of and payment
for the first series of Notes issued hereunder, and such Financed Student Loans,
revenues, securities and other moneys shall thereupon be immediately subject to
the lien, pledge and charge hereof upon receipt thereof by the Issuer or
Trustee, without any physical delivery or segregation thereof or further act.
No Beneficiary shall be required to see that the moneys derived from any
Note are applied to the purpose or purposes for which the Note is issued. The
validity of the Notes shall neither be dependent upon nor affected by the use
and application of the proceeds of such Notes.
The pledge of the Financed Student Loans, revenues, securities and other
moneys made hereby includes the pledge of any contract or any evidence of
indebtedness or other rights of the Issuer to receive any of the same, whether
now existing or hereafter coming into existence, and whether now or hereafter
acquired, and the proceeds thereof.
SECTION 4.10. INVESTMENTS. Moneys held by the Trustee for the credit of any
Fund or Account shall be invested by the Trustee, in accordance with the
Sections hereof relating to such Funds and Accounts, as directed in writing by
the Issuer, to the fullest extent practicable and reasonable, in Investment
Securities which shall mature or be redeemable at the option of the holder
without penalty prior to the respective times when the moneys held for the
credit of such Fund or Account will be required for the purposes intended,
including for the purpose of paying debt service on the Notes.
Subject to the right of the Issuer to direct in writing the investment of
funds hereunder, moneys in any Fund or Account or any combination of Funds and
Accounts shall be continuously invested and reinvested or deposited and
redeposited by the Trustee. If the Issuer shall fail to direct the investment of
any amounts hereunder, then the Trustee shall invest such moneys in Investment
Securities described in clause (f) of the definition of Investment Securities.
The Investment Securities purchased shall be held by the Trustee and shall be
deemed at all times to be part of such Fund or Account or combination thereof.
The Trustee shall sell or present for redemption, any Investment Securities
purchased by it as an investment whenever it shall be necessary to provide
moneys to meet any payment from such Fund or Account. The Trustee may purchase
from or sell to itself or an affiliate, as principal or agent, any Investment
Securities. The Trustee shall advise the Issuer of all investments held for the
credit of each Fund or Account in its custody under the provisions of this
Indenture as provided in Section 7.14 hereof.
Any investment of funds in Investment Securities shall be held by a
financial institution in accordance with the following requirements:
(a) all Investment Securities shall be held in an account with such
financial institution in the name of the Trustee;
(b) all Investment Securities held in such account shall be delivered
to the Trustee in the following manner:
(i) with respect to bankers' acceptances, commercial paper,
negotiable certificates of deposit and other obligations that
constitute "instruments" within the meaning of Section 9-102(a)(47) of
the UCC (other than certificated securities) and are susceptible of
physical delivery, transferred to the Trustee by physical delivery to
the Trustee, indorsed to, or registered in the name of, the Trustee or
its nominee or indorsed in blank; or such additional or alternative
procedures as may hereafter become appropriate to effect the complete
transfer of ownership of any such Investment Securities to the Trustee
free of any adverse claims, consistent with changes in applicable law
or regulations or the interpretation thereof;
(ii) with respect to a "certificated security" (as defined in
Section 8-102(a)(4) of the UCC), transferred:
(A) by physical delivery of such certificated security to
the Trustee, provided that if the certificated security is in
registered form, it shall be endorsed to, or registered in the
name of, the Trustee or endorsed in blank;
(B) by physical delivery of such certificated security in
registered form to a "securities intermediary" (as defined in
Section 8-102(a)(14) of the UCC) acting on behalf of the Trustee
if the certificated security has been specially endorsed to the
Trustee by an effective endorsement;
(iii) with respect to any security issued by the U.S. Treasury,
the Federal Home Loan Mortgage Corporation or by the Federal National
Mortgage Association that is a book-entry security held through the
Federal Reserve System pursuant to Federal book entry regulations, the
following procedures, all in accordance with applicable law, including
applicable federal regulations and Articles 8 and 9 of the UCC:
book-entry registration of such property to an appropriate book-entry
account maintained with a Federal Reserve Bank by a securities
intermediary which is also a "depositary" pursuant to applicable
federal regulations and issuance by such securities intermediary of a
deposit advice or other written confirmation of such book-entry
registration to the Trustee of the purchase by the securities
intermediary on behalf of the Trustee of such book-entry security; the
making by such securities intermediary of entries in its books and
records identifying such book-entry security held through the Federal
Reserve System pursuant to Federal book-entry regulations as belonging
to the Trustee and indicating that such securities intermediary holds
such book-entry security solely as agent for the Trustee; or such
additional or alternative procedures as may hereafter become
appropriate to effect complete transfer of ownership of any such
Investment Securities to the Trustee free of any adverse claims,
consistent with changes in applicable law or regulations or the
interpretation thereof;
(iv) with respect to any "uncertificated security" (as defined in
Section 8-102(a)(18) of the UCC) that is not governed by clause (iii)
above, transferred:
(A) (1) by registration to the Trustee as the registered
owner thereof, on the books and records of the issuer thereof; or
(2) by registration to another Person (not a securities
intermediary) that either becomes the registered owner of
the uncertificated security on behalf of the Trustee or,
having become the registered owner, acknowledges that it
holds for the Trustee; or
(B) by the issuer thereof having agreed that it will comply
with instructions originated by the Trustee without further
consent of the registered owner thereof;
(v) with respect to any "security entitlement" (as defined in
Section 8-102(a)(17) of the UCC):
(A) if a securities intermediary
(1) indicates by book entry that a "financial asset"
(as defined in Section 8-102(a)(9) of the UCC) has been
credited to the Trustee's "securities account" (as defined
in Section 8-501(a) of the UCC),
(2) receives a financial asset (as so defined) from the
Trustee or acquires a financial asset for the Trustee, and,
in either case, accepts it for credit to the Trustee's
securities account (as so defined),
(3) becomes obligated under other law, regulation or
rule to credit a financial asset to the Trustee's securities
account, or
(4) has agreed that it will comply with "entitlement
orders" (as defined in Section 8-102(a)(8) of the UCC)
originated by the Trustee, without further consent by the
"entitlement holder" (as defined in Section 8-102(a)(7) of
the UCC), and
(B) such financial asset either is such Investment Security
or a security entitlement evidencing a claim thereto; and
(vi) in each case of delivery contemplated pursuant to clauses
(i) through (v) above, the Trustee shall make appropriate notations on
its records, and shall cause the same to be made on the records of its
nominees, indicating that such Investment Security is held in trust
pursuant to and as provided in this Indenture.
Any cash held by the Trustee shall be considered a "financial asset" for
purposes of this paragraph. Subject to the other provisions hereof, the Trustee
shall have sole control over each such investment and the income thereon, and
any certificate or other instrument evidencing any such investment, if any,
shall be delivered directly to the Trustee or its agent, together with each
document of transfer, if any, necessary to transfer title to such investment to
the Trustee in a manner which complies with this paragraph.
The Trustee agrees that it has no security interest or other adverse claim
to the Funds and Accounts or the Investment Securities therein that are part of
the Trust Estate other than pursuant to this Indenture and that it will not
enter into any agreement that would give any Person or entity other than the
Trustee the right to give entitlement orders with respect to such Investment
Securities or the Funds and Accounts.
SECTION 4.11. TRANSFER OF INVESTMENT SECURITIES. Whenever any transfer is
required by this Indenture to be made from any Fund or Account to any other Fund
or Account, the Trustee may use Investment Securities, or allocable portions
thereof, included in the Balance of the former to the extent necessary to make
such transfer, but only to the extent such Investment Securities are permissible
investments for the Fund or Account to which they are to be transferred. The
amount of any such transfer of Investment Securities shall be the Value thereof
determined with respect thereto as of the date of transfer.
SECTION 4.12. TRANSFER OF MONEY FOLLOWING REVOLVING PERIOD. Notwithstanding
any other provision of this Indenture to the contrary, no transfer of moneys
shall be made to the Acquisition Fund following the end of the Revolving Period,
nor will moneys in the Surplus Fund be used to acquire Eligible Loans following
the end of the Revolving Period; provided, however, that the Issuer may acquire
any Add-On Loan required to be funded under the Higher Education Act within 180
days after the end of the Revolving Period.
SECTION 4.13. RELEASE. The Trustee shall, upon Issuer Order and subject to
the provisions of this Indenture, take all actions reasonably necessary to
effect the release of any Financed Eligible Loans from the lien of this
Indenture to the extent the terms hereof permit the sale, disposition or
transfer of such Financed Eligible Loans.
Subject to the payment of its fees and expenses pursuant to Sections 7.02
and 7.21, the Trustee may, and when required by the provisions of this Indenture
shall, execute instruments to release property from the lien of this Indenture,
or convey the Trustee's interest in the same, in a manner and under
circumstances that are not inconsistent with the provisions of this Indenture.
No party relying upon an instrument executed by the Trustee as provided in this
Article IV shall be bound to ascertain the Trustee's authority, inquire into the
satisfaction of any conditions precedent or see to the application of any
moneys.
The Trustee shall, at such time as there are no Notes Outstanding and all
sums due the Trustee pursuant to Sections 7.02 and 7.21 and all amounts payable
to the Master Servicer, the Issuer Administrator, the Auction Agents, the
Broker-Dealers, the Delaware Trustee and the Counterparties have been paid,
release any remaining portion of the Trust Estate that secured the Notes from
the lien of this Indenture and release to the Issuer or any other Person
entitled thereto any funds then on deposit in the Funds and Accounts. The
Trustee shall release property from the lien of this Indenture pursuant to this
Section 4.13 only upon receipt of an Issuer Order, an Opinion of Counsel and (if
required by the TIA) Independent Certificates in accordance with TIA Sections
314(c) and 314(d)(1).
Subject to the provisions of this Indenture and except for sales of
Financed Student Loans pursuant to Section 4.02, the Trustee shall release
property from the lien of this Indenture only upon receipt of an Issuer Order,
an Opinion of Counsel and Independent Certificates in accordance with TIA
Sections 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such
Independent Certificates to the effect that the TIA does not require any such
Independent Certificates.
Each Registered Owner, by the acceptance of a Note, acknowledges that from
time to time the Trustee shall release the lien of this Indenture on any
Financed Eligible Loan to be sold pursuant to Section 4.02, and each Registered
Owner, by the acceptance of a Note, consents to any such release.
ARTICLE V
COVENANTS TO SECURE NOTES, REPRESENTATIONS AND WARRANTIES
SECTION 5.01. ELIGIBLE LENDER TRUSTEE TO HOLD FINANCED STUDENT LOANS. The
Issuer shall cause all Financed Student Loans to be endorsed and otherwise
conveyed to the Issuer or the Eligible Lender Trustee on behalf of the Issuer.
SECTION 5.02. ENFORCEMENT AND AMENDMENT OF GUARANTEE AGREEMENTS. So long as
any Notes or Other Obligations are Outstanding and Financed Eligible Loans are
guaranteed by a Guarantee Agency, the Issuer will (a) from and after the date on
which the Eligible Lender Trustee on its behalf shall have either entered into,
or succeeded to the rights and interests of any Lender under, any Guarantee
Agreement covering Financed Eligible Loans, cause the Eligible Lender Trustee to
maintain such Guarantee Agreement and diligently enforce the Eligible Lender
Trustee's rights thereunder; (b) cause the Eligible Lender Trustee to enter into
such other similar or supplemental agreements as shall be required to maintain
benefits for all Financed Eligible Loans covered thereby; and (c) not
voluntarily consent to or permit any rescission of or consent to any amendment
to or otherwise take any action under or in connection with any such Guarantee
Agreement or any similar or supplemental agreement which in any manner will
materially adversely affect the rights of the Holders from time to time of the
Notes or Other Beneficiaries hereunder. Notwithstanding the foregoing, the
Issuer may amend any Guarantee Agreement, or may cause the Eligible Lender
Trustee to amend any Guarantee Agreement, in any respect if the Rating Agency
Condition is satisfied with respect to such amendment.
SECTION 5.03. ACQUISITION, COLLECTION AND ASSIGNMENT OF STUDENT LOANS. The
Issuer shall acquire only Eligible Loans with moneys in any of the Funds and
shall diligently cause to be collected all principal and interest payments
(subject to any adjustments described in Section 5.04 hereof) on all the
Financed Student Loans and other sums to which the Issuer is entitled with
respect to such Financed Student Loans, and all Special Allowance Payments and
all defaulted payments guaranteed by any Guarantee Agency which relate to such
Financed Student Loans.
SECTION 5.04. ENFORCEMENT OF FINANCED STUDENT LOANS. The Issuer shall cause
to be diligently enforced, and shall cause to be taken all steps, actions and
proceedings reasonably necessary for the enforcement of, all terms, covenants
and conditions of all Financed Student Loans and agreements in connection
therewith, including the prompt payment of all principal and interest payments
and all other amounts due the Issuer thereunder. The Issuer shall not permit the
release of the obligations of any borrower under any Financed Student Loan and
shall at all times, to the extent permitted by law, cause to be defended,
enforced, preserved and protected the rights and privileges of the Issuer, the
Eligible Lender Trustee, the Trustee and the Beneficiaries under or with respect
to each Financed Student Loan and agreement in connection therewith. The Issuer
shall not consent or agree to or permit any amendment or modification of any
Financed Student Loan or agreement in connection therewith which will in any
manner materially adversely affect the rights or security of the Beneficiaries;
provided, that nothing in this Section 5.04 or in Sections 5.03 and 5.05 hereof
shall be construed to prevent the Issuer from (i) settling a default or from
curing a delinquency on any Financed Student Loan on such terms as shall be
required by law; (ii) amending the terms of a Financed Student Loan to provide
for a different rate of interest thereon to the extent required by law; (iii)
amending the terms of any Financed Student Loan or agreement in connection
therewith in any manner if the Rating Agency Condition is met with respect to
such amendment; or (iv) providing any Borrower Benefits with respect to Financed
Student Loans not in excess of a 0.25% per annum interest rate reduction;
provided, however, that subject to a Rating Agency Condition the Borrower
Benefits may exceed such amount.
SECTION 5.05. ADMINISTRATION AND COLLECTION OF FINANCED STUDENT LOANS. The
Issuer shall enter into one or more Servicing Agreements pursuant to which the
Servicers (which shall not include the Issuer) agree to service and collect all
FFELP Loans in accordance with all applicable requirements of the Higher
Education Act, the Secretary of Education, this Indenture and each Guarantee
Agreement. The Issuer may enter into the Administration Agreement with the
Issuer Administrator and into other administration agreements with other
administrators, provided that the Issuer Administrator and each such other
administrator shall (a) be in compliance with the laws of each state necessary
to enable it to perform its obligations under the Administration Agreement or
related administration agreement (as applicable); and (b) either have a net
worth of at least $5,000,000 or be an affiliate of the Issuer, otherwise
satisfying a Rating Agency Condition.
The Issuer shall cause to be diligently enforced, and take all reasonable
steps, actions and proceedings necessary for the enforcement of, all terms,
covenants and conditions of all Servicing Agreements, the Administration
Agreement, the Eligible Lender Trust Agreement, any Loan Purchase Agreement, and
all other administration agreements, including, in the case of the Servicing
Agreements, the prompt payment of all principal and interest payments and all
other amounts due the Issuer or the Trustee thereunder, including all Special
Allowance Payments and all defaulted payments guaranteed by any Guarantee Agency
which relate to any Financed Student Loans. The Issuer shall not permit the
release of the obligations of any Servicer under any Servicing Agreement or the
Issuer Administrator or any other administrator under the Administration
Agreement or the related administration agreement or of the Eligible Lender
Trustee under the Eligible Lender Trust Agreement or of the parties to any Loan
Purchase Agreement, as applicable, except in accordance with the terms thereof,
and shall at all times, to the extent permitted by law, cause to be defended,
enforced, preserved and protected the rights and privileges of the Issuer, the
Trustee and the Beneficiaries under or with respect to each Servicing Agreement,
the Administration Agreement and each other administration agreement. The Issuer
shall not consent or agree to or permit any amendment or modification of any
Servicing Agreement, the Administration Agreement, the Eligible Lender Trust
Agreement, any Loan Purchase Agreement or any other administration agreement
without satisfying a Rating Agency Condition.
SECTION 5.06. PUNCTUAL PAYMENTS. The Issuer shall duly and punctually pay,
or cause to be paid, the principal of, premium, if any, and interest on and any
Carry-Over Amount (and accrued interest thereon) due and payable with respect to
each and every Note and each Other Obligation from the revenues and other assets
pledged hereunder on the dates and at the places, and in the manner provided, in
the Notes and with respect to each Other Obligation according to the true intent
and meaning thereof, and the Issuer shall faithfully do and perform and at all
times fully observe and keep any and all of its covenants, undertakings,
stipulations and provisions contained in the Notes, the Other Obligations and
this Indenture. The Issuer shall duly and punctually pay, or cause to be paid,
the Note Fees, Servicing Fees and Administration Fees from the revenues and
other assets pledged hereunder as and when the same became due.
SECTION 5.07. FURTHER ASSURANCES. Each of the Issuer and the Eligible
Lender Trustee shall at any and all times, insofar as it may be authorized so to
do, pass, make, do, execute, acknowledge and deliver all and every such further
resolutions, indentures, acts, deeds, conveyances, assignments, transfers and
assurances as may be necessary or desirable for the better assuring, conveying,
granting, assigning and confirming any and all of the rights, revenues,
securities and other moneys hereby pledged or charged with or assigned to the
payment of the Notes or Other Obligations, or intended so to be, or which the
Issuer and/or the Eligible Lender Trustee may hereafter become bound to pledge
or charge or assign.
SECTION 5.08. PROTECTION OF SECURITY; POWER TO ISSUE NOTES AND PLEDGE
REVENUES AND OTHER Funds. The Issuer is duly authorized under all applicable law
to create and issue the Notes, to enter into this Indenture, to enter into Other
Obligations and to pledge the revenues and other moneys, Financed Student Loans,
securities, properties, rights, interests and evidences of indebtedness
purported to be pledged by this Indenture in the manner and to the extent
provided in this Indenture. The revenues and other moneys, securities, evidences
of indebtedness and properties so pledged are and will be free and clear of any
pledge, lien, charge or encumbrance thereon or with respect thereto prior to, or
of equal rank with, the pledge created by this Indenture, except as otherwise
expressly provided herein, and all action on the part of the Issuer to that end
has been duly and validly taken. The Notes and the provisions of this Indenture,
each Supplemental Indenture and each Other Obligation are and will be valid and
legally enforceable obligations of the Issuer in accordance with their terms and
the terms of this Indenture and each Supplemental Indenture. The Issuer shall at
all times, to the extent permitted by law, defend, preserve and protect the
pledge of the revenues and other moneys, Financed Student Loans, securities,
properties, rights, interests and evidences of indebtedness pledged under this
Indenture and each Supplemental Indenture and all the rights of the
Beneficiaries hereto against all claims and demands of all Persons whomsoever.
The pledge of the revenues and other moneys, Financed Student Loans,
securities, properties, rights, interests and evidences of indebtedness made
hereby includes the pledge of any contract or any evidence of indebtedness or
other rights of the Issuer to receive any of the same, whether now existing or
hereafter coming into existence, and whether now or hereafter acquired, and the
proceeds thereof.
In consideration of the purchase and acceptance of the Notes by those who
shall hold the same from time to time and the execution and delivery by Other
Beneficiaries of any Other Obligations, the provisions of this Indenture shall
be a part of the contract of the Issuer with the Beneficiaries and shall be
deemed to be and shall constitute a contract between the Issuer, the Trustee and
the Beneficiaries.
SECTION 5.09. NO ENCUMBRANCES. The Issuer will not create, or permit the
creation of, any pledge, lien, charge or encumbrance upon the Financed Student
Loans or the revenues and other moneys, securities, properties, rights,
interests and evidences of indebtedness pledged under this Indenture, except
only as to a lien subordinate to the lien of this Indenture created by any other
indenture authorizing the issuance of bonds, notes or other evidences of
indebtedness of the Issuer the proceeds of which have been or will be used to
refund or otherwise retire all or a portion of the Outstanding Notes (but only
upon receipt by the Trustee of an opinion of Counsel that the creation of such
lien will not be prejudicial to the Trustee or the Holders of any Outstanding
Notes or any Other Beneficiary) or as otherwise provided in or permitted by this
Indenture. The Issuer will not issue any bonds or other evidences of
indebtedness, other than the Notes as permitted by this Indenture and other than
Swap Agreements and Credit Enhancement Facilities relating to Notes as permitted
by this Indenture, secured by a pledge of the revenues and other moneys,
securities, properties, rights, interests and evidences of indebtedness herein
pledged or held aside by the Issuer or by a fiduciary under this Indenture,
creating a lien or charge on such revenues and other moneys, securities,
properties, rights, interests and evidences of indebtedness equal or superior to
the lien of this Indenture; provided that nothing in this Indenture shall
prevent the Issuer from issuing obligations secured by assets and revenues of
the Issuer other than the revenues and other moneys, securities, properties,
rights, interests and evidences of indebtedness pledged in this Indenture.
SECTION 5.10. CONTINUING EXISTENCE; MERGER AND CONSOLIDATION. The Issuer
will maintain its existence as a Delaware statutory trust and will not dispose
of all or substantially all of its assets (by sale, lease or otherwise), except
as otherwise specifically authorized in this Indenture, or consolidate with or
merge into another entity or permit any other entity to consolidate with or
merge into it unless either the Issuer is the surviving entity or each of the
following conditions is satisfied:
(a) the surviving, resulting or transferee entity, as the case may be,
shall be a corporation, limited liability company or other legal entity
organized under the laws of the United States or one of the states thereof;
(b) at least 30 days before any merger, consolidation or transfer of
assets becomes effective, the Issuer shall give the Trustee written notice
of the proposed transaction;
(c) immediately after giving effect to any merger, consolidation or
transfer of assets, no Event of Default shall have occurred and be
continuing;
(d) the Rating Agency Condition shall have been satisfied with respect
to any merger, consolidation or transfer of assets; and
(e) prior to or concurrently with any merger, consolidation or
transfer of assets, (i) any action as is necessary to maintain the lien and
security interest created in favor of the Trustee by this Indenture shall
have been taken; (ii) the surviving, resulting or transferee entity, as the
case may be, shall deliver to the Trustee an instrument assuming all of the
obligations of the Issuer under this Indenture, any Notes, any Swap
Agreement, any Credit Enhancement Facility, any Remarketing Agreement, any
Tender Agent Agreement, any Auction Agent Agreement and any Servicing
Agreement, together with the consent of the other parties, if any, to each
such instrument to such assumption; and (iii) the Issuer shall have
delivered to the Trustee and each Rating Agency an Issuer Certificate and
an opinion of Counsel (which shall describe the actions taken as required
by clause (i) of this paragraph or that no such action need be taken) each
stating that all conditions precedent herein provided for relating to such
merger, consolidation or transfer of assets have been compiled with.
SECTION 5.11. AMENDMENT OF REMARKETING AGREEMENTS AND TENDER AGENT
AGREEMENTS. The Issuer shall notify the Trustee and any related Credit Facility
Provider in writing of any proposed amendments to any Remarketing Agreement or
Tender Agent Agreement. No such amendment shall become effective unless and
until (a) the Trustee consents in writing thereto, which consent shall not be
given unless the Trustee receives an opinion of Counsel that such amendment is
required by a Credit Enhancement Facility or this Indenture or is not to the
material prejudice of the Holders of the Notes; and (b) any related Credit
Facility Provider consents in writing thereto, which consent shall not be
unreasonably withheld, provided that no consent of the Credit Facility Provider
shall be required if the Credit Facility Provider receives an opinion of Counsel
that such amendment is required by this Indenture.
SECTION 5.12. TAX TREATMENT. The Issuer has entered into this Indenture,
and the Notes will be issued, with the intention that, for federal, state and
local income, business and franchise tax purposes, the Notes will qualify as
indebtedness of the Issuer. The Issuer, by entering into this Indenture, and
each Noteholder, by its acceptance of its Note, agree to treat the Notes for
federal, state and local income, business and franchise tax purposes as
indebtedness of the Issuer.
SECTION 5.13. REPRESENTATIONS AND WARRANTIES OF THE ISSUER. By execution of
this Indenture, the Issuer makes the following representations and warranties:
(a) ORGANIZATION AND GOOD STANDING. It has been duly organized and is
validly existing as a Delaware statutory trust, with power and authority to
own its properties and to conduct its business as such properties are
currently owned and as such business is currently conducted and is proposed
to be conducted pursuant to this Indenture.
(b) POWER AND AUTHORITY. It has the power and authority to execute and
deliver this Indenture and to perform its obligations pursuant thereto; and
the execution, delivery and performance of this Indenture, the Notes and
each Other Obligation have been duly authorized by all necessary corporate
action.
(c) NO CONSENT REQUIRED. No consent, license, approval or
authorization of, or registration or declaration with, any Person or any
governmental authority, bureau or agency is required to be obtained by the
Issuer in connection with the execution, delivery or performance of this
Indenture, the Notes or any Other Obligation, except for such as have been
obtained, effected or made.
(d) NO VIOLATION. The consummation of the transactions contemplated by
this Indenture, the Notes and each Other Obligation and the fulfillment of
its obligations under this Indenture, the Notes and each Other Obligation
will not conflict with, result in any breach of any of the terms and
provisions of or constitute (with or without notice, lapse of time or both)
a default under, its certificate of incorporation or bylaws, or any
indenture, agreement, mortgage, deed of trust or other instrument to which
it is a party or by which it is bound, or result in the creation or
imposition of any lien upon any of its properties pursuant to the terms of
any such indenture, agreement, mortgage, deed of trust or other instrument,
or violate any law, order, rule or regulation applicable to it of any court
or of any federal or state regulatory body, administrative agency or other
governmental instrumentality having jurisdiction over it or any of its
properties.
(e) NO PROCEEDINGS. There are no proceedings or investigations pending
or, to its knowledge, threatened against it before any court, regulatory
body, administrative agency or other tribunal or governmental
instrumentality having jurisdiction over it or its properties (i) asserting
the invalidity of this Indenture, any Note or any Other Obligation; (ii)
seeking to prevent the issuance of the Notes or the consummation of any of
the transactions contemplated by this Indenture, any Note or any Other
Obligation; or (iii) seeking any determination or ruling that might
materially and adversely affect its performance of its obligations under,
or the validity or enforceability of, this Indenture, any Note or any Other
Obligation.
(f) PLACE OF BUSINESS. The principal office of the Issuer is in
Wilmington, Delaware.
(g) NOT AN INVESTMENT COMPANY. The Issuer is not an "investment
company" within the meaning of the Investment Company Act of 1940, as
amended, or is exempt from all provisions of such Act.
(h) BINDING OBLIGATIONS. This Indenture, the Notes and each Other
Obligation constitutes the legal, valid and binding obligation of the
Issuer, enforceable against the Issuer in accordance with its terms, except
(i) as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect, affecting the enforcement of creditors' rights in
general; and (ii) as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in equity).
(i) VALID SECURITY INTEREST. This Indenture creates a valid and
continuing security interest (as defined in the Uniform Commercial Code as
in effect in the State of Delaware in the Financed Student Loans in favor
of the Trustee, and is enforceable as such against any creditors of the
Issuer.
SECTION 5.14. USE OF TRUSTEE ELIGIBLE LENDER NUMBER. The Eligible Lender
Trustee covenants and agrees not to hold any other FFELP Loans under the federal
eligible lender number under which it holds any Financed FFELP Loans (1) without
the express written consent of the Issuer, and (2) without having caused the
beneficial owner of any such other FFELP Loans (and any other appropriate
persons) to have entered into an agreement (a "Joint Sharing Agreement") with
the Issuer and the Trustee, whereby the Issuer and such other beneficial owner
covenant to indemnify each other in respect of federal interest subsidies,
Special Allowance Payments, Guarantee payments or any other payments by a
Guarantee Agency (a) received by the Eligible Lender Trustee on their behalf,
(b) later determined by the Secretary of Education or a Guarantee Agency to have
been incorrectly or inappropriately paid to the Eligible Lender Trustee, and (c)
for which the Secretary of Education or a Guarantee Agency reimburses itself, in
whole or in part, by withholding payments to the Eligible Lender Trustee, or
otherwise seeks reimbursement from the Eligible Lender Trustee, with respect to
student loans held by the Eligible Lender Trustee on behalf of the other party.
No Joint Sharing Agreement shall be entered into without satisfaction of a
Rating Agency Condition.
SECTION 5.15. ADDITIONAL COVENANTS. The Issuer covenants that it will
acquire or cause to be acquired Student Loans as described herein. The Holders
of the Notes shall not in any circumstances be deemed to be the owner or holder
of the Financed Student Loan.
The Issuer, or its designated agent, shall be responsible for each of the
following actions:
(a) The Issuer, or its designated agent, shall be responsible for
dealing with the Secretary of Education with respect to the rights,
benefits and obligations under the certificates of insurance and the
contract of insurance with respect to Financed Student Loans, and the
Issuer, or its designated agent, shall be responsible for dealing with the
Guarantee Agency with respect to the rights, benefits and obligations under
any Guarantee Agreement with respect to the Financed Student Loans.
(b) The Issuer, or its designated agent, shall comply, and shall cause
all of its officers, directors, employees and agents to comply, with the
provisions of the Higher Education Act and any regulations or rulings
thereunder, and with the provisions of any Guarantee Agreement with respect
to the Financed Student Loans.
(c) The Issuer, or its designated agent, shall cause the benefits of
the Guarantee Agreements, the federal interest subsidy payments and the
Special Allowance Payments to flow to the Trustee.
(d) The Trustee shall have no obligation to administer, service or
collect the loans in the Trust Estate or to maintain or monitor the
administration, servicing or collection of such loans.
The Trustee shall not be deemed to be the designated agent for the purposes
of this Section unless it has agreed in writing to be such agent.
SECTION 5.16. COVENANT REGARDING FINANCED STUDENT LOANS. The Issuer hereby
covenants that at the time of acquisition by the Issuer, all Student Loans to be
acquired hereunder will meet the following:
(a) Each Student Loan is evidenced by an executed promissory note
(which may be in electronic form), which note is a valid and binding
obligation of the borrower, enforceable by or on behalf of the holder
thereof in accordance with its terms, subject to bankruptcy, insolvency and
other laws relating to or affecting creditors' rights.
(b) The amount of the unpaid principal balance of each Student Loan is
due and owing, and no counterclaim, offset, defense or right to rescission
exists with respect to any such Student Loan which can be asserted and
maintained or which, with notice, lapse of time, or the occurrence or
failure to occur of any act or event, could be asserted and maintained by
the borrower against the Issuer as assignee thereof. The Issuer shall take
all reasonable actions to assure that no maker of a Student Loan has or may
acquire a defense to the payment thereof.
(c) No Student Loan has a payment that is more than 90 days overdue.
(d) The Issuer has full right, title and interest in each Student Loan
free and clear of all liens, pledges or encumbrances whatsoever, and other
than the security interest granted to the Trustee hereunder, the Issuer has
not pledged, assigned, sold, granted a security interest in, or otherwise
conveyed any of the Student Loans to any other Person. The Issuer has not
authorized the filing of and is not aware of any financing statements
against it that include a description of collateral covering the Student
Loans, other than any financing statement relating to the security interest
granted to the Trustee hereunder or any financing statement that has been
terminated. The Issuer is not aware of any judgment or tax lien filings
against it.
(e) Each Student Loan was made in compliance with all applicable
local, state and federal laws, rules and regulations, including, without
limitation, all applicable nondiscrimination, truth-in-lending, consumer
credit and usury laws.
(f) All loan documentation shall be delivered to a custodian (as
custodian for the Trustee) prior to payment of the purchase price of such
Student Loan.
(g) Each Student Loan is accruing interest (whether or not such
interest is being paid currently, either by the borrower or the Secretary
of Education, or is being capitalized), except as otherwise expressly
permitted by this Indenture.
(h) Each Student Loan constitutes an "instrument" as defined in the
Uniform Commercial Code as in effect in the state of Delaware.
(i) The Issuer has received all consents and approvals required by the
terms of each Student Loan to the pledge of such Student Loan hereunder to
the Trustee.
(j) The Issuer has caused or will have caused, within ten days of the
Closing Date, the filing of all appropriate financing statements in the
proper offices of all jurisdictions in which filing is necessary under
applicable law in order to perfect the security interest of the Trustee in
the Student Loans.
(k) The original executed copy of each promissory note that
constitutes or evidences a Student Loan will be delivered to the Custodian
on behalf of and for the benefit of the Trustee.
(l) At the time each Student Loan is delivered to the Custodian, the
Issuer will receive a written acknowledgment from the Custodian that the
Custodian is holding each promissory note that constitutes or evidences a
Student Loan solely on behalf of and for the benefit of the Trustee (which
evidence may be in the form of a loan roster, a bond or note identification
report, or any other similar report routinely generated by the Custodian).
(m) The promissory notes that constitute or evidence the Student Loans
will not have any marks or notations indicating that they have been
pledged, assigned or otherwise conveyed to any Person other than the
Trustee. All financing statements filed or to be filed against the Issuer
in favor of the Trustee in connection herewith describing the Student Loans
contain the following statement: "A purchase of or security interest in any
collateral described in this financing statement will violate the rights of
the Trustee."
SECTION 5.17. CONFIRMATION AS TO TRUST FUND. On or before January 31 in
each calendar year, beginning in 2003, the Issuer shall furnish confirmation to
the Trustee either stating that such action has been taken with respect to the
recording, filing, re-recording and refiling of this Indenture, any indentures
supplemental hereto and any other requisite documents and with respect to the
execution and filing of any financing statements and continuation statements as
is necessary to maintain the lien and security interest created by this
Indenture and reciting the details of such action or stating that no such action
is necessary to maintain such lien and security interest. Such confirmation
shall also describe the recording, filing, re-recording and refiling of this
Indenture, any indentures supplemental hereto and any other requisite documents
and the execution and filing of any financing statements and continuation
statements that will, be required to maintain the lien and security interest of
this Indenture until January 31 in the following calendar year.
SECTION 5.18. REPORTS BY ISSUER. The Issuer will:
(a) File with the Trustee, within 15 days after the Issuer is required
to file the same with the Commission, copies of the annual reports and of
the information, documents and other reports (or copies of such portions of
any of the foregoing as the Commission may from time to time by rules and
regulations prescribe), if any, which the Issuer may be required to file
with the Commission pursuant to Section 13 or Section 15(d) of the Exchange
Act;
(b) File with the Trustee and the Commission, in accordance with rules
and regulations prescribed from time to time by the Commission, such
additional information, documents and reports, if any, with respect to
compliance by the Issuer with the conditions and covenants of this
Indenture as may be required from time to time by such rules and
regulations; and
(c) Transmit by mail to the Noteholders, within 30 days after the
filing thereof with the Trustee, in the manner and to the extent provided
in TIA Section 313(c), such summaries of any information, documents and
reports required to be filed by the Issuer, if any, pursuant to Section
5.18(a) and (b) as may be required by rules and regulations prescribed from
time to time by the Commission.
The Trustee may conclusively rely and accept such reports from the Issuer
as fulfilling the requirements of this Section 5.18, with no further duty to
know, determine or examine such reports or comply with the prescribed timing,
rules and regulations of the Commission.
SECTION 5.19. STATEMENT AS TO COMPLIANCE. The Issuer will deliver to the
Trustee, within 75 days after the end of each fiscal year, a brief certificate
from an Authorized Officer as to his or her knowledge stating the Issuer is in
compliance with all conditions and covenants under this Indenture and, in the
event of any noncompliance, specifying such noncompliance and the nature and
status thereof. For purposes of this Section 5.19, such compliance shall be
determined without regard to any period of grace or requirement of notice under
this Indenture.
SECTION 5.20. OPINIONS AS TO TRUST ESTATE.
(a) On the Closing Date, the Issuer shall furnish to the Trustee an
Opinion of Counsel either stating that, in the opinion of such counsel,
such action has been taken with respect to the recording and filing of this
Indenture, any Supplemental Indentures hereto, and any other requisite
documents, and with respect to the execution and filing of any financing
statements and continuation statements, as are necessary to perfect and
make effective the lien and security interest of this Indenture and
reciting the details of such action, or stating that, in the opinion of
such counsel, no such action is necessary to make such lien and security
interest effective.
(b) On or before March 31, in each calendar year, beginning on March
31, 2004, the Issuer shall furnish to the Trustee an Opinion of Counsel
either stating that, in the opinion of such counsel, such action has been
taken with respect to the recording, filing, re-recording and refiling of
this Indenture, any Supplemental Indentures hereto and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as are necessary to maintain the
lien and security interest created by this Indenture and reciting the
details of such action or stating that in the opinion of such counsel no
such action is necessary to maintain such lien and security interest. Such
Opinion of Counsel shall also describe the recording, filing, re-recording
and refiling of this Indenture, any Supplemental Indentures hereto and any
other requisite documents and the execution and filing of any financing
statements and continuation statements that will, in the opinion of such
counsel, be required to maintain the lien and security interest of this
Indenture until March 31, in the following calendar year.
SECTION 5.21. REPRESENTATIONS OF THE ISSUER REGARDING THE TRUSTEE'S
SECURITY INTEREST. The Issuer hereby represents and warrants for the benefit of
the Trustee and the Noteholders as follows:
(a) This Indenture creates a valid and continuing security interest
(as defined in the applicable Uniform Commercial Code in effect in the
State of Delaware) in the Financed Student Loans in favor of the Trustee,
which security interest is prior to all other liens, charges, security
interests, mortgages or other encumbrances, and is enforceable as such as
against creditors of and purchasers from the Issuer.
(b) The Higher Education Act deems the Financed Student Loans to
constitute accounts within the meaning of the applicable UCC as in effect
in the State of Delaware for the purposes of perfecting a security interest
in the Financed Eligible Loans.
(c) The Issuer (or the Eligible Lender Trustee on behalf of the
Issuer) owns and has good and marketable title to the Financed Student
Loans free and clear of any lien, charge, security interest, mortgage or
other encumbrance, claim or encumbrance of any Person.
(d) The Issuer has caused or will have caused, within 10 days, the
filing of all appropriate financing statements in the proper filing office
in the appropriate jurisdictions under applicable law in order to perfect
the security interest in the Financed Student Loans granted to the Trustee
hereunder.
(e) All executed copies of each promissory note that constitute or
evidence the Financed Student Loans have been delivered to either the
Trustee or a Custodian.
(f) The Issuer has received a written acknowledgment from each
Custodian that such Custodian is holding the promissory notes that
constitute or evidence the Financed Student Loans solely on behalf and for
the benefit of the Trustee.
(g) Other than the security interest granted to the Trustee pursuant
to this Indenture, the Issuer has not pledged, assigned, sold, granted a
security interest in, or otherwise conveyed any of the Financed Student
Loans. The Issuer has not authorized the filing of and is not aware of any
financing statements against the Issuer that include a description of
collateral covering the Financed Student Loans other than any financing
statement relating to the security interest granted to the Trustee
hereunder or that has been terminated. The Issuer is not aware of any
judgment or tax lien filings against the Issuer.
SECTION 5.22. COVENANTS OF THE ISSUER REGARDING THE TRUSTEE'S SECURITY
INTEREST. The Issuer hereby covenants for the benefit of the Trustee and the
Noteholders as follows:
(a) The representations and warranties set forth in Section 5.21 shall
survive the termination of this Indenture.
(b) The Trustee shall not waive any of the representations and
warranties set forth in Section 5.21 above.
(c) The Issuer shall take all steps necessary, and shall cause the
Servicers to take all steps necessary and appropriate, to maintain the
perfection and priority of the Trustee's security interest in the Financed
Student Loans.
ARTICLE VI
DEFAULTS AND REMEDIES
SECTION 6.01. EVENTS OF DEFAULT. If any of the following events occur, it
is hereby defined as and declared to be and to constitute an Event of Default,
whatever the reason therefor and whether voluntary or involuntary or effected by
operation of law:
(a) default in the due and punctual payment of any interest on any
Senior Note; or
(b) default in the due and punctual payment of the principal of, or
premium, if any, on, any Senior Note, whether at the Stated Maturity
thereof, at the date fixed for prepayment thereof (including, but not
limited to, Sinking Fund Payment Dates) or otherwise upon the maturity
thereof; or
(c) default by the Issuer in its obligation to purchase any Senior
Note on a Tender Date therefor; or
(d) default in the due and punctual payment of any amount owed by the
Issuer to any Other Senior Beneficiary under a Senior Swap Agreement or
Senior Credit Enhancement Facility; or
(e) if no Senior Obligations are Outstanding, default in the due and
punctual payment of any interest on any Subordinate Note; or
(f) if no Senior Obligations are Outstanding, default in the due and
punctual payment of the principal of, or premium, if any, on, any
Subordinate Note, whether at the Stated Maturity thereof, at the date fixed
for prepayment thereof (including, but not limited to, Sinking Fund Payment
Dates) or otherwise upon the maturity thereof; or
(g) if no Senior Obligations are Outstanding, default by the Issuer in
its obligation to purchase any Subordinate Note on a Tender Date therefor;
or
(h) if no Senior Obligations are Outstanding, default in the due and
punctual payment of any amount owed by the Issuer to any Other Subordinate
Beneficiary under a Subordinate Swap Agreement or Subordinate Credit
Enhancement Facility; or
(i) if no Senior Obligations and no Subordinate Obligations are
Outstanding, default in the due and punctual payment of any interest on any
Junior Subordinate Note; or
(j) if no Senior Obligations and no Subordinate Obligations are
Outstanding, default in the due and punctual payment of the principal of,
or premium, if any, on, any Junior Subordinate Note, whether at the Stated
Maturity thereof, at the date fixed for prepayment thereof (including, but
not limited to, Sinking Fund Payment Dates) or otherwise upon the maturity
thereof; or
(k) if no Senior Obligations and no Subordinate Obligations are
Outstanding, default by the Issuer in its obligation to purchase any Junior
Subordinate Note on a Tender Date therefor; or
(l) if no Senior Obligations and no Subordinate Obligations are
Outstanding, default in the due and punctual payment of any amount owed by
the Issuer to any Other Junior Subordinate Beneficiary under a Junior
Subordinate Swap Agreement or Junior Subordinate Credit Enhancement
Facility; or
(m) default in the performance of any of the Issuer's obligations with
respect to the transmittal of moneys to be credited to the Collection Fund,
the Acquisition Fund or the Debt Service Fund under the provisions hereof
and such default shall have continued for a period of thirty days; or
(n) default in the performance or observance of any other of the
covenants, agreements or conditions on the part of the Issuer in this
Indenture or in the Notes contained, and such default shall have continued
for a period of thirty days after written notice thereof, specifying such
default, shall have been given to the Issuer by the Trustee, which may give
such notice in its discretion and shall give such notice at the written
request of the Acting Beneficiaries Upon Default); provided that, if the
default is such that it can be corrected, but not within such thirty days,
it shall not constitute an Event of Default if corrective action is
instituted by the Issuer within such thirty days and is diligently pursued
until the default is corrected; or
(o) if the Issuer shall:
(i) admit in writing its inability to pay its debts generally as
they become due; or
(ii) consent to the appointment of a custodian (as that term is
defined in the federal Bankruptcy Code) for or assignment to a
custodian of the whole or any substantial part of the Issuer's
property, or fail to stay, set aside or vacate within 90 days from the
date of entry thereof any order or decree entered by a court of
competent jurisdiction ordering such appointment or assignment; or
(iii) commence any proceeding or file a petition under the
provisions of the federal Bankruptcy Code for liquidation,
reorganization or adjustment of debts, or under any insolvency law or
other statute or law providing for the modification or adjustment of
the rights of creditors or fail to stay, set aside or vacate within 90
days from the date of entry thereof any order or decree entered by a
court of competent jurisdiction pursuant to an involuntary proceeding,
whether under federal or state law, providing for liquidation or
reorganization of the Issuer or modification or adjustment of the
rights of creditors; or
(p) there occurs the filing of a decree or order for relief by a court
having jurisdiction in the premises in respect of the Issuer or any
substantial part of the Trust Estate in an involuntary case under any
applicable federal or state bankruptcy, insolvency or other similar law now
or hereafter in effect, or appointing a receiver, liquidation, assignee,
custodian, trustee, sequestrator or similar official of the Issuer or for
any substantial part of the Trust Estate, or ordering the winding-up or
liquidation of the Issuer's affairs, and such decree or order shall remain
unstayed and in effect for a period of 90 consecutive days.
SECTION 6.02. ACCELERATION. Whenever any Event of Default described in
Section 6.01 shall have occurred and be continuing, the Trustee may (and upon
the written request of the Acting Beneficiaries Upon Default, the Trustee
shall), by notice in writing delivered to the Issuer, declare the principal of
and interest accrued on all Notes then Outstanding due and payable. A copy of
such notice shall also be provided to any Tender Agent, any Remarketing Agent,
any Auction Agent, any Market Agent and any Broker-Dealer. In the event that the
Trustee shall declare the principal of and interest accrued on all Notes then
Outstanding due and payable in accordance with this Section 6.02, such principal
and interest shall become immediately due and payable on the date of
declaration. At any time after such a declaration of acceleration has been made,
but before a judgment or decree for payment of the money due has been obtained
by the Trustee, the Acting Beneficiaries Upon Default may, by written notice to
the Issuer and the Trustee, rescind and annul such declaration and its
consequences if:
(a) There has been paid to or deposited with the Trustee by or for the
account of the Issuer, or provision satisfactory to the Trustee has been
made for the payment of, a sum sufficient to pay:
(i) if Senior Obligations are Outstanding:
(A) all overdue installments of interest on all Senior
Notes;
(B) the principal of (and premium, if any, on) any Senior
Notes which have become due otherwise than by such declaration of
acceleration, together with interest thereon at the rate or rates
borne by such Senior Notes;
(C) to the extent that payment of such interest is lawful,
interest upon overdue installments of interest on the Senior
Notes at the rate or rates borne by such Senior Notes;
(D) all Other Senior Obligations which have become due other
than as a direct result of such declaration of acceleration;
(E) all other sums required to be credited to the Collection
Fund and the Interest Account under the provisions of this
Indenture; and
(F) all sums paid or advanced by the Trustee under this
Indenture and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel
and any Paying Agents, Remarketing Agents, Tender Agents, Auction
Agents, Market Agents and Broker-Dealers; or
(ii) if no Senior Obligations are Outstanding but Subordinate
Obligations are Outstanding:
(A) all overdue installments of interest on all Subordinate
Notes;
(B) the principal of (and premium, if any, on) any
Subordinate Notes which have become due other than by such
declaration of acceleration, together with interest thereon at
the rate or rates borne by such Subordinate Notes;
(C) to the extent that payment of such interest is lawful,
interest upon overdue installments of interest on the Subordinate
Notes at the rate or rates borne by such Subordinate Notes;
(D) all Other Subordinate Obligations which have become due
otherwise as a direct result of such declaration of acceleration;
(E) all other sums required to be credited to the Collection
Fund and the Interest Account under the provisions of this
Indenture; and
(F) all sums paid or advanced by the Trustee under this
Indenture and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel
and any Paying Agents, Remarketing Agents, Tender Agents, Auction
Agents and Broker-Dealers; or
(iii) if no Senior Obligations and no Subordinate Obligations are
Outstanding but Junior Subordinate Notes are Outstanding:
(A) all overdue installments of interest on all Junior
Subordinate Notes;
(B) the principal of (and premium, if any, on) any Junior
Subordinate Notes which have become due other than by such
declaration of acceleration, together with interest thereon at
the rate or rates borne by such Junior Subordinate Notes;
(C) to the extent that payment of such interest is lawful,
interest upon overdue installments of interest on the Junior
Subordinate Notes at the rate or rates borne by such Junior
Subordinate Notes;
(D) all Other Junior Subordinate Obligations which have
become due otherwise as a direct result of such declaration of
acceleration;
(E) all other sums required to be credited to the Collection
Fund and the Interest Account under the provisions of this
Indenture; and
(F) all sums paid or advanced by the Trustee under this
Indenture and the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel
and any Paying Agents, Remarketing Agents, Tender Agents, Auction
Agents and Broker-Dealers.
(b) All Events of Default, other than the non-payment of the principal
of Notes or Other Obligations which have become due solely by, or as a
direct result of, such declaration of acceleration, have been cured or
waived as provided in Section 6.13 hereof.
No such rescission and annulment shall affect any subsequent default or
impair any right consequent thereon.
SECTION 6.03. OTHER REMEDIES; RIGHTS OF BENEFICIARIES. If an Event of
Default has occurred and is continuing, the Trustee may (a) institute judicial
proceedings in its own name and as or on behalf of a trustee of an express trust
for the collection of all amounts then payable on the Notes and any Other
Obligations or under this Indenture with respect thereto, whether by declaration
or otherwise, enforce any judgment obtained, and collect from the Issuer and any
other obligor upon such Notes and Other Obligations moneys adjudged due; and (b)
pursue any other available remedy by suit at law or in equity to enforce the
covenants of the Issuer herein, including, without limitation, any remedy of a
secured party under the Delaware Uniform Commercial Code, foreclosure and
mandamus, and may pursue such appropriate judicial proceedings as the Trustee
shall deem most effective to protect and enforce, or aid in the protection and
enforcement of, the covenants and agreements herein.
If an Event of Default shall have occurred and is continuing, and if it
shall have been requested so to do by the Acting Beneficiaries Upon Default and
shall have been indemnified to its reasonable satisfaction as provided in
Section 7.01 hereof, the Trustee shall be obliged to exercise such one or more
of the rights and powers conferred by this Section 6.03 as the Trustee, being
advised by its Counsel, shall deem most expedient in the interests of the
Beneficiaries; provided, however, that the Trustee shall have the right to
decline to comply with any such request if the Trustee shall be advised by
Counsel that the action so requested may not lawfully be taken or if the Trustee
receives, before exercising such right or power, contrary instructions from the
Acting Beneficiaries Upon Default.
Notwithstanding any other provisions of this Article VI, if an "Event of
Default" (as defined therein) occurs under a Swap Agreement or a Credit
Enhancement Facility and, as a result, the Other Beneficiary that is a party
thereto is entitled to exercise one or more remedies thereunder, such Other
Beneficiary may exercise such remedies, including, without limitation, the
termination of such agreement, as provided therein, in its own discretion;
provided that the exercise of any such remedy shall not adversely affect the
legal ability of the Trustee or Acting Beneficiaries Upon Default to exercise
any remedy available hereunder.
No remedy by the terms of this Indenture conferred upon or reserved to the
Trustee or to the Beneficiaries is intended to be exclusive of any other remedy,
but each and every such remedy shall be cumulative and shall be in addition to
any other remedy given to the Trustee or to the Beneficiaries hereunder or now
or hereafter existing at law or in equity or by statute. The assertion or
employment of any right or remedy hereunder shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
No delay or omission to exercise any right or power accruing upon any Event
of Default shall impair any such right or power or shall be construed to be a
waiver of any such Event of Default or acquiescence therein; and every such
right and power may be exercised from time to time and as often as may be deemed
expedient by the Trustee or the Acting Beneficiaries Upon Default, as the case
may be.
SECTION 6.04. DIRECTION OF PROCEEDINGS BY ACTING BENEFICIARIES UPON
DEFAULT. The Acting Beneficiaries Upon Default shall have the right, at any
time, by an instrument or instruments in writing executed and delivered to the
Trustee, to direct the method and place of conducting all proceedings to be
taken in connection with the enforcement of the terms and conditions of this
Indenture; provided that (a) such direction shall not be otherwise than in
accordance with the provisions of law and of this Indenture; (b) the Trustee
shall not determine that the action so directed would be unjustly prejudicial to
the Holders of Notes or Other Beneficiaries not taking part in such direction,
other than by effect of the subordination of any of their interests hereunder;
(c) the Trustee may take any other action deemed proper by the Trustee which is
not inconsistent with such direction and (d) the Trustee shall be indemnified to
its reasonable satisfaction as provided in Section 7.01 hereof.
SECTION 6.05. WAIVER OF STAY OR EXTENSION LAWS. To the extent that such
rights may lawfully be waived, neither the Issuer nor anyone claiming through it
or under it shall or will set up, claim, or seek to take advantage of any stay
or extension laws now or hereafter in force, which may affect the covenants or
agreements contained in this Indenture, or in the Notes, and the Issuer, for
itself and all who may claim through or under it, hereby waives, to the extent
that it lawfully may do so, the benefit of all such laws.
SECTION 6.06. APPLICATION OF MONEYS. All moneys received by the Trustee
pursuant to any right given or action taken under the provisions of this Article
VI shall, after, except as otherwise provided in a Supplemental Indenture,
payment of the cost and expenses of the proceedings resulting in the collection
of such moneys and of the expenses, liabilities, disbursements and advances
incurred or made by the Trustee and any counsel with respect thereto and any
other outstanding fees and expenses of the Trustee (provided that any moneys or
Investment Securities held pursuant to Section 9.01 hereof with respect to Notes
no longer deemed Outstanding hereunder shall not be available for, nor be
applied to, the payment of any such costs, expenses, liabilities or advances),
be applied as follows (except that moneys received with respect to Credit
Enhancement Facilities shall be applied only to the purposes for which such
Credit Enhancement Facilities were provided, and shall be so applied prior to
the application of other moneys as provided in this Section 6.06):
(a) Unless the principal of all the Outstanding Notes shall have
become or shall have been declared due and payable, all such moneys shall be
applied:
(i) to the payment to the Senior Beneficiaries of all
installments of principal and interest then due on the Senior Notes and all
Other Senior Obligations (except with respect to Senior Swap Agreements, only
amounts due in the ordinary course and not any termination, indemnity or other
similar or extraordinary payment without satisfaction of a Rating Agency
Condition), and if the amount available shall not be sufficient to pay all such
amounts in full, then to the payment ratably, in proportion to the amounts due,
without regard to due date, to the Senior Noteholders and to each Other Senior
Beneficiary, without any discrimination or preference (provided, that the
Trustee shall apply the amount so apportioned to the Senior Noteholders, as
follows:
(A) to the payment of all installments of interest (other
than interest on overdue principal) then due and payable in the order in which
such installments became due and payable, and if the amount available shall not
be sufficient to pay in full any particular installment, then to the payment,
ratably, according to the amounts due on such installment and other amounts, to
the Senior Noteholders entitled thereto, without any discrimination or
preference, and
(B) to the payment of the unpaid principal of any of the
Senior Notes which shall have become due and payable (other than Senior Notes
called for redemption for the payment of which money is held pursuant to the
provisions of this Indenture) in the order of their stated payment dates, with
interest on the Principal Amount of such Notes at the respective rates specified
therein from the respective dates upon which such Senior Notes became due and
payable, and, if the amount available shall not be sufficient to pay in full the
principal of the Senior Notes by their stated terms due and payable on any
particular date, then to the payment of such principal, ratably, according to
the amount of such principal then due on such date, to the Senior Noteholders
entitled thereto without any discrimination or preference);
(ii) (but only if the Senior Asset Percentage would be at least
100% upon the application of such amounts or if there are no Senior Notes
Outstanding), to the payment to the Subordinate Beneficiaries of all
installments of principal and interest then due on the Subordinate Notes and all
Other Subordinate Obligations (except with respect to Subordinate Swap
Agreements, only amounts due in the ordinary course and not any termination,
indemnity or other similar or extraordinary payment without satisfaction of a
Rating Agency Condition), and if the amount available shall not be sufficient to
pay all such amounts in full, then to the payment ratably, in proportion to the
amounts due, without regard to due date, to the Subordinate Noteholders and to
each Other Subordinate Beneficiary, without any discrimination or preference
(provided, that the Trustee shall apply the amount so apportioned to the
Subordinate Noteholders, as follows:
(A) to the payment of all installments of interest (other
than interest on overdue principal) then due and payable in the order in which
such installments became due and payable, and if the amount available shall not
be sufficient to pay in full any particular installment, then to the payment,
ratably, according to the amounts due on such installment and other amounts, to
the Subordinate Noteholders entitled thereto, without any discrimination or
preference, and
(B) to the payment of the unpaid principal of any of the
Subordinate Notes which shall have become due and payable (other than
Subordinate Notes called for redemption for the payment of which money is held
pursuant to the provisions of this Indenture) in the order of their stated
payment dates, with interest on the Principal Amount of such Notes at the
respective rates specified therein from the respective dates upon which such
Subordinate Notes became due and payable, and, if the amount available shall not
be sufficient to pay in full the principal of the Subordinate Notes by their
stated terms due and payable on any particular date, then to the payment of such
principal, ratably, according to the amount of such principal then due on such
date, to the Subordinate Noteholders entitled thereto without any discrimination
or preference);
(iii) (but only if the Subordinate Asset Percentage would be at
least 100% upon the application of such amounts or if there are no Senior Notes
or Subordinate Notes Outstanding), to the payment to the Junior Subordinate
Beneficiaries of all installments of principal and interest then due on the
Junior Subordinate Notes and all Other Junior Subordinate Obligations (except
with respect to Junior Subordinate Swap Agreements, only amounts due in the
ordinary course and not any termination, indemnity or other similar or
extraordinary payment without satisfaction of a Rating Agency Condition), and if
the amount available shall not be sufficient to pay all such amounts in full,
then to the payment ratably, in proportion to the amounts due, without regard to
due date, to the Junior Subordinate Noteholders and to each Other Junior
Subordinate Beneficiary, without any discrimination or preference (provided,
that the Trustee shall apply the amount so apportioned to the Junior Subordinate
Noteholders, as follows:
(A) to the payment of all installments of interest (other
than interest on overdue principal) then due and payable in the order in which
such installments became due and payable, and if the amount available shall not
be sufficient to pay in full any particular installment, then to the payment,
ratably, according to the amounts due on such installment and other amounts, to
the Junior Subordinate Noteholders entitled thereto, without any discrimination
or preference, and
(B) to the payment of the unpaid principal of any of the
Junior Subordinate Notes which shall have become due and payable (other than
Junior Subordinate Notes called for redemption for the payment of which money is
held pursuant to the provisions of this Indenture) in the order of their stated
payment dates, with interest on the Principal Amount of such Notes at the
respective rates specified therein from the respective dates upon which such
Junior Subordinate Notes became due and payable, and, if the amount available
shall not be sufficient to pay in full the principal of the Junior Subordinate
Notes by their stated terms due and payable on any particular date, then to the
payment of such principal, ratably, according to the amount of such principal
then due on such date, to the Junior Subordinate Noteholders entitled thereto
without any discrimination or preference);
(iv) to the payment of the Holders of the Senior Notes of all
Carry-Over Amounts (together with interest thereon) then due and payable in the
order in which such amounts became due and payable, and if the amount available
shall not be sufficient to pay in full all such Carry-Over Amounts (and interest
thereon) which became due and payable on any particular date, then to the
payment, ratably, according to the amounts due on such date, to the Senior
Noteholders entitled thereto, without any discrimination or preference;
(v) (but only if the Senior Asset Percentage would be at least
100% upon the application of such amounts or if there are no Senior Notes
Outstanding), to the payment to the Holders of the Subordinate Notes of all
Carry-Over Amounts (together with interest thereon) then due and payable in the
order in which such amounts became due and payable, and if the amount available
shall not be sufficient to pay in full all such Carry-Over Amounts (and interest
thereon) which became due and payable on any particular date, then to the
payment, ratably, according to the amounts due on such date, to the Subordinate
Noteholders entitled thereto, without any discrimination or preference;
(vi) (but only if the Subordinate Asset Percentage would be at
least 100% upon the application of such amounts or if there are no Senior Notes
or Subordinate Notes Outstanding), to the payment to the Holders of the Junior
Subordinate Notes of all Carry-Over Amounts (together with interest thereon)
then due and payable in the order in which such amounts became due and payable,
and if the amount available shall not be sufficient to pay in full all such
Carry-Over Amounts (and interest thereon) which became due and payable on any
particular date, then to the payment, ratably, according to the amounts due on
such date, to the Junior Subordinate Noteholders entitled thereto, without any
discrimination or preference;
(vii) to the payment of termination, indemnity or other similar
or extraordinary payments then due and payable to Swap Counterparties under
Senior Swap Agreements as a result of Swap Counterparty default, in the order in
which such termination payments became due and payable, and if the amount
available shall not be sufficient to pay in full all such termination payments
which became due and payable on any particular date, then to the payment,
ratably, according to the amounts due on such date, to the Senior Swap
Counterparties entitled thereto, without any discrimination or preference;
(viii) (but only if the Senior Asset Percentage would be at least
100% upon the application of such amounts or if there are no Senior Notes
Outstanding), to the payment of termination, indemnity or other similar or
extraordinary payments then due and payable to Swap Counterparties under
Subordinate Swap Agreements as a result of Swap Counterparty default, in the
order in which such termination payments became due and payable, and if the
amount available shall not be sufficient to pay in full all such termination
payments which became due and payable on any particular date, then to the
payment, ratably, according to the amounts due on such date, to the Subordinate
Swap Counterparties entitled thereto, without any discrimination or preference;
and
(ix) (but only if the Subordinate Asset Percentage would be at
least 100% upon the application of such amounts or if there are no Senior Notes
or Subordinate Notes Outstanding), to the payment of termination, indemnity or
other similar or extraordinary payments then due and payable to Swap
Counterparties under Junior Subordinate Swap Agreements as a result of Swap
Counterparty default, in the order in which such termination payments became due
and payable, and if the amount available shall not be sufficient to pay in full
all such termination payments which became due and payable on any particular
date, then to the payment, ratably, according to the amounts due on such date,
to the Junior Subordinate Swap Counterparties entitled thereto, without any
discrimination or preference.
(b) If the principal of all Outstanding Notes shall have become due or
shall have been declared due and payable and such declaration has not been
annulled and rescinded under the provisions of this Article VI, all such moneys
shall be applied, as follows:
(i) to the payment to the Senior Beneficiaries of the principal
and interest then due and unpaid upon the Senior Notes and all Other Senior
Obligations (except with respect to Senior Swap Agreements, only amounts due in
the ordinary course and not any termination, indemnity or other similar or
extraordinary payment without satisfaction of a Rating Agency Condition),
without preference or priority of principal over interest or of interest over
principal, or of any installment of interest over any other installment of
interest, or of any Senior Beneficiary over any other Senior Beneficiary,
ratably, according to the amounts due, to the Persons entitled thereto without
any discrimination or preference;
(ii) to the payment to the Subordinate Beneficiaries of the
principal and interest then due and unpaid upon the Subordinate Notes and all
Other Subordinate Obligations (except with respect to Subordinate Swap
Agreements, only amounts due in the ordinary course and not any termination,
indemnity or other similar or extraordinary payment without satisfaction of a
Rating Agency Condition), without preference or priority of principal over
interest or of interest over principal, or of any installment of interest over
any other installment of interest, or of any Subordinate Beneficiary over any
other Subordinate Beneficiary, ratably, according to the amounts due, to the
Persons entitled thereto without any discrimination or preference;
(iii) to the payment to the Junior Subordinate Beneficiaries of
the principal and interest then due and unpaid upon the Junior Subordinate Notes
and all Other Junior Subordinate Obligations (except with respect to Junior
Subordinate Swap Agreements, only amounts due in the ordinary course and not any
termination, indemnity or other similar or extraordinary payment without
satisfaction of a Rating Agency Condition), without preference or priority of
principal over interest or of interest over principal, or of any installment of
interest over any other installment of interest, or of any Junior Subordinate
Beneficiary over any other Junior Subordinate Beneficiary, ratably, according to
the amounts due, to the Persons entitled thereto without any discrimination or
preference;
(iv) to the payment of the Holders of the Senior Notes of all
Carry-Over Amounts (together with interest thereon) then due and unpaid, without
any preference or priority of Carry-Over Amounts over interest thereon or of
interest thereon over Carry-Over Amounts, ratably, according to the amounts due,
to the Senior Noteholders entitled thereto, without any discrimination or
preference;
(v) to the payment to the Holders of the Subordinate Notes of all
Carry-Over Amounts (together with interest thereon) then due and unpaid, without
any preference or priority of Carry-Over Amounts over interest thereon or of
interest thereon over Carry-Over Amounts, ratably, according to the amounts due,
to the Subordinate Noteholders entitled thereto, without any discrimination or
preference;
(vi) to the payment to the Holders of the Junior Subordinate
Notes of all Carry-Over Amounts (together with interest thereon) then due and
unpaid, without any preference or priority of Carry-Over Amounts over interest
thereon or of interest thereon over Carry-Over Amounts, ratably, according to
the amounts due, to the Junior Subordinate Noteholders entitled thereto, without
any discrimination or preference;
(vii) to the payment of termination, indemnity or other similar
or extraordinary payments then due and unpaid to Swap Counterparties under
Senior Swap Agreements as a result of Swap Counterparty default, ratably,
according to the amounts due on such date, to the Senior Swap Counterparties
entitled thereto, without any discrimination or preference;
(viii) to the payment of termination, indemnity or other similar
or extraordinary payments then due and unpaid to Swap Counterparties under
Subordinate Swap Agreements as a result of Swap Counterparty default, ratably,
according to the amounts due on such date, to the Subordinate Swap
Counterparties entitled thereto, without any discrimination or preference; and
(i) (ix) to the payment of termination, indemnity or other
similar or extraordinary payments then due and unpaid to Swap
Counterparties under Junior Subordinate Swap Agreements as a
result of Swap Counterparty default, ratably, according to the
amounts due on such date, to the Junior Subordinate Swap
Counterparties entitled thereto, without any discrimination or
preference.
(c) If the principal of all the Outstanding Notes shall have been
declared due and payable and if such declaration shall thereafter have been
rescinded and annulled under the provisions of Section 6.02 hereof, then
(subject to the provisions of paragraph (b) of this Section 6.06, in the event
that the principal of all the Outstanding Notes shall later become or be
declared due and payable) the money held by the Trustee hereunder shall be
applied in accordance with the provisions of paragraph (a) of this Section 6.06.
Whenever moneys are to be applied by the Trustee pursuant to the provisions
of this Section 6.06, such moneys shall be applied by it at such times, and from
time to time, as the Trustee shall determine, having due regard to the amount of
such moneys available for application and the likelihood of additional moneys
becoming available for such application in the future. Whenever the Trustee
shall apply such funds, it shall fix the date (which shall be an Interest
Payment Date unless it shall deem another date more suitable) upon which such
application is to be made and upon such date interest on the amounts of
principal to be paid shall cease to accrue. The Trustee shall give such notice
as it may deem appropriate of the deposits with it of any such moneys and of the
fixing of any such date, and shall not be required to make payment to the Holder
of any unpaid Note until such Note shall be presented to the Trustee for
appropriate endorsement or for cancellation if fully paid.
Whenever all Notes and interest thereon and all Other Obligations have been
fully paid under the provisions of this Section 6.06, and all expenses and
charges of the Trustee have been paid, the Issuer and the Trustee shall be
restored to their former positions hereunder.
SECTION 6.07. REMEDIES VESTED IN TRUSTEE. All rights of action, including
the right to file proof of claims under this Indenture or under any of the Notes
may be enforced by the Trustee without the possession of any of the Notes or the
production thereof in any trial or other proceedings relating thereto, and any
such suit or proceeding instituted by the Trustee shall be brought in its name
as Trustee without the necessity of joining as plaintiffs or defendants any
Beneficiaries, and any recovery of judgment shall be for the equal benefit of
all Beneficiaries in respect of which such judgment has been recovered.
SECTION 6.08. LIMITATION ON SUITS BY BENEFICIARIES. Except as may be
permitted in a Supplemental Indenture with respect to an Other Beneficiary, no
Holder of any Note or Other Beneficiary shall have any right to institute any
suit, action or proceeding in equity or at law for the enforcement of this
Indenture or for the execution of any trust hereof or for the appointment of a
receiver or any other remedy hereunder unless (a) an Event of Default shall have
occurred and be continuing; (b) the Acting Beneficiaries Upon Default shall have
made written request to the Trustee; (c) such Beneficiary or Beneficiaries shall
have offered to the Trustee indemnity, as provided in Section 7.01 hereof; (d)
the Trustee shall have thereafter failed for a period of 60 days after the
receipt of the request and indemnification or refused to exercise the powers
hereinbefore granted or to institute such action, suit or proceeding in its own
name; and (e) no direction inconsistent with such written request shall have
been given to the Trustee during such 60-day period by the Holders of not less
than a majority in aggregate Principal Amount of the Notes then Outstanding; it
being understood and intended that no one or more Holders of the Notes or any
Other Beneficiary shall have any right in any manner whatsoever to affect,
disturb or prejudice the lien of this Indenture by his, her, its or their action
or to enforce any right hereunder except in the manner herein provided, and that
all proceedings at law or in equity shall be instituted, had and maintained in
the manner herein provided and for the benefit of the Holders of all Outstanding
Notes and Other Beneficiaries hereunder as their interests may appear hereunder;
provided, however, that, notwithstanding the foregoing provisions of this
Section 6.08, the Acting Beneficiaries Upon Default may institute any such suit,
action or proceeding in their own names for the benefit of the Holders of all
Outstanding Notes and Other Beneficiaries hereunder.
SECTION 6.09. UNCONDITIONAL RIGHT OF NOTEHOLDERS TO ENFORCE PAYMENT.
Notwithstanding any other provision in this Indenture, the Holder of any Note
shall have the right, which is absolute and unconditional, to receive payment of
the principal of, premium, if any, and interest on such Note in accordance with
the terms thereof and hereof and, upon the occurrence of an Event of Default
with respect thereto, to institute suit for the enforcement of any such payment,
and such right shall not be impaired without the consent of such Holder.
SECTION 6.10. TRUSTEE MAY FILE PROOFS OF CLAIMS. In case of the pendency of
any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Issuer or the property of the Issuer, the Trustee (irrespective of whether
the principal of the Notes shall then be due and payable as therein expressed or
by declaration or otherwise and irrespective of whether the Trustee shall have
made any demand on the Issuer for the payment of overdue principal or interest)
shall be entitled and empowered, by intervention in such proceeding or
otherwise,
(a) to file and prove a claim for the whole amount of principal,
premium, if any, and interest owing and unpaid in respect of the Notes then
Outstanding and to file such other papers or documents as may be necessary
or advisable in order to have the claims of the Trustee (including any
claim for the reasonable compensation, expenses, disbursements and advances
of the Trustee, its agents and Counsel and any Paying Agents,
Authenticating Agents, Note Registrar, Remarketing Agents, Tender Agents,
Auction Agents, Market Agents and Broker-Dealers) and of the Beneficiaries
allowed in such judicial proceeding, and
(b) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any receiver, assignee, trustee, liquidator, sequestrator or other similar
official in any such judicial proceeding is hereby authorized by each Noteholder
to make such payments to the Trustee and, in the event that the Trustee shall
consent to the making of such payments directly to the Noteholders, to pay to
the Trustee any amount due to it for the reasonable compensation, expenses and
disbursements of the Trustee, its agents and Counsel and any Paying Agents,
Authenticating Agents, Note Registrar, Remarketing Agents, Tender Agents,
Auction Agents, Market Agents and Broker-Dealers.
Nothing herein shall affect the right of any Paying Agent, Authenticating
Agent, Note Registrar, Remarketing Agent, Tender Agent, Auction Agent, Market
Agent or Broker-Dealer to file proofs of claim on their own behalf in any such
proceeding.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Noteholder or Other
Beneficiary any plan of reorganization, arrangement, adjustment or composition
affecting the Notes or the rights of any Holder thereof or Other Beneficiary, or
to authorize the Trustee to vote in respect of the claim of any Noteholder in
any such proceeding.
SECTION 6.11. UNDERTAKING FOR COSTS. The Issuer and the Trustee agree, and
each Holder of any Note by his, her or its acceptance thereof shall be deemed to
have agreed, that any court may in its discretion require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Trustee for any action taken or omitted by it as Trustee, the filing by any
party litigant in such suit of an undertaking to pay the costs of such suit, and
that such court may in its discretion assess reasonable costs, including
reasonable attorneys fees, against any party litigant in such suit, having due
regard to the merits and good faith of the claims or defenses made by such party
litigant; but the provisions of this Section 6.11 shall not apply to (a) any
suit instituted by the Trustee; (b) any suit instituted by any Noteholder, or
group of Noteholders, in each case holding in the aggregate more than 10% of the
Outstanding Principal Amount of the Notes; or (c) any suit instituted by any
Noteholder for the enforcement of the payment of the principal of, premium, if
any, or interest on any Note in accordance with Section 6.09 hereof.
SECTION 6.12. TERMINATION OF PROCEEDINGS. In case the Trustee or any
Beneficiary shall have proceeded to enforce any right under this Indenture by
the appointment of a receiver, or otherwise, and such proceedings shall have
been discontinued or abandoned for any reason, or shall have been determined
adversely to the Trustee or such Beneficiary, then and in every such case the
Issuer and the Trustee or such Beneficiary shall, subject to any final
determination in such proceedings, be restored to their former positions and
rights hereunder with respect to this Indenture, and all rights, remedies and
powers of the Trustee and the Beneficiaries shall continue as if no such
proceedings had been taken.
SECTION 6.13. WAIVER OF DEFAULTS AND EVENTS OF DEFAULT. The Trustee shall,
unless the Trustee has declared the principal of and interest on all Outstanding
Notes immediately due and payable in accordance with Section 6.02 hereof and a
judgment or decree for payment of the money due has been obtained by the
Trustee, waive any default or Event of Default hereunder and its consequences
but only upon written request of the Acting Beneficiaries Upon Default;
provided, however, that there shall not be waived (a) any Event of Default
arising from the acceleration of the maturity of the Notes, except upon the
rescission and annulment of such declaration as described in Section 6.02
hereof; (b) any Event of Default in the payment when due of any amount owed to
any Beneficiary (including payment of principal of or interest on any Note)
except with the consent of such Beneficiary or unless, prior to such waiver, the
Issuer has paid or deposited (or caused to be paid or deposited) with the
Trustee a sum sufficient to pay all amounts owed to such Beneficiary (including,
to the extent permitted by law, interest upon overdue installments of interest);
(c) any Event of Default arising from the failure of the Issuer to pay unpaid
expenses of the Trustee, its agents and counsel, and any Authenticating Agent,
Paying Agents, Note Registrar, Remarketing Agents, Tender Agents, Auction
Agents, Market Agents and Broker-Dealers as required by this Indenture, unless,
prior to such waiver, the Issuer has paid or deposited (or caused to be paid or
deposited) with the Trustee sums required to satisfy such obligations of the
Issuer under the provisions of this Indenture; or (d) any default in respect of
a covenant or provision hereof which, under Article VIII hereof, cannot be
modified or amended without the consent of the Holder of each Note affected
thereby. No such waiver shall extend to any subsequent or other default or Event
of Default, or impair any right consequent thereon.
SECTION 6.14. INSPECTION OF BOOKS AND RECORDS. The Issuer covenants that if
an Event of Default shall have happened and shall not have been remedied, the
books of record and account of the Issuer relating to the Financed Student Loans
and the Trust Estate, shall at all times be subject to the inspection and use of
the Trustee and any Holder of at least 25% of the Principal Amount of the Notes
Outstanding and of their respective agents and attorneys.
The Issuer covenants that if an Event of Default shall have happened and
shall not have been remedied, the Issuer will continue to account, as a trustee
of an express trust, for all other money, securities and property pledged under
this Indenture.
ARTICLE VII
FIDUCIARIES
SECTION 7.01. ACCEPTANCE OF THE TRUSTEE. The Trustee hereby accepts the
trusts imposed upon it by this Indenture, and agrees to perform said trusts, but
only upon and subject to the following terms and conditions:
(a) Except during the continuance of an Event of Default;
(i) the Trustee undertakes to perform such duties and only such
duties as are specifically set forth in this Indenture, and no implied
covenants or obligations shall be read into this Indenture against the
Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture; but in the case of any such certificates or
opinions which by any provisions hereof are specifically required to
be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform in form to
the requirements of this Indenture; and the Trustee shall not be bound
to make any investigation into the facts or matters stated in any
resolution, certificate, statement, instrument, opinion, report,
notice, request, consent, entitlement order, approval or other paper
or document.
(b) In case an Event of Default has occurred and is continuing of
which an officer of the Trustee has actual knowledge, the Trustee shall
exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent man
would exercise or use under the circumstances in the conduct of his own
affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent
failure to act, or its own willful misconduct, except that:
(i) this subsection (c) shall not be construed to limit the
effect of subsection (a) of this Section;
(ii) the Trustee shall not be liable for any error of judgment
made in good faith by an officer or officers of the Trustee, unless it
shall be conclusively determined that the Trustee was negligent in
ascertaining the pertinent facts;
(iii) the Trustee shall not be liable with respect to any action
taken or omitted to be taken by it in good faith in accordance with
the direction of the Issuer with respect to matters which the Issuer
is entitled to direct hereunder or the Acting Beneficiaries Upon
Default relating to the time, method and place of conducting any
proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred upon the Trustee, under this Indenture; and
(iv) no provision of this Indenture shall require the Trustee to
expend or risk its own funds or otherwise incur any liability,
financial or otherwise, in the performance of any of its duties
hereunder, or in the exercise of any of its rights or powers, if it
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity reasonably satisfactory to it against such
risk or liability is not reasonably assured to it.
(d) The Trustee may execute any of the trusts or powers hereof and
perform any of its duties by or through attorneys, agents, receivers,
custodians, nominees or employees and shall not be liable for the acts or
omissions of such parties appointed with due care and shall be entitled to
advice of Counsel and the advice or any opinion of counsel shall be full
and complete authorization and protection in respect of any action taken or
admitted by it hereunder in good faith and in accordance with such advice
or opinion of counsel, and may in all cases pay reasonable compensation to
any attorney, agent, receiver or employee retained or employed by it in
connection herewith. The Trustee may act upon the opinion or advice of any
Counsel or accountant selected by it in the exercise of reasonable care.
The Trustee shall not be responsible for any loss or damage resulting from
any action or inaction based on its good faith reliance upon such opinion
or advice.
(e) The Trustee shall not be responsible for any recital herein or in
the Notes (except with respect to the certificate of the Trustee endorsed
on the Notes), or for the filing or refiling of this Indenture, or for the
validity of the execution by the Issuer of this Indenture, or of any
Supplemental Indenture or instrument of further assurance, or for the
sufficiency of the security for the Notes issued hereunder or intended to
be secured hereby.
(f) The Trustee shall not be accountable for the use or application by
the Issuer of any of the Notes or the proceeds thereof or for the use or
application of any money paid over by the Trustee in accordance with the
provisions of this Indenture or for the use and application of money
received by any Paying Agent.
(g) The Trustee may conclusively rely and shall be fully protected in
acting upon any notice, order, requisition, request, consent, certificate,
order, opinion (including an opinion of Counsel), affidavit, letter,
telegram or other paper or document deemed by it to be genuine and correct
and to have been signed or sent by the proper person or persons. Any action
taken by the Trustee pursuant to this Indenture upon the request or
authority or consent of any person who at the time of making such request
or giving such authority or consent is the Holder of any Note shall be
conclusive and binding upon all future Holders of the same Note and Notes
issued in exchange therefor or in place thereof.
(h) Whenever in the administration of the provisions of this Agreement
the Trustee shall deem it necessary or desirable that a matter be proved or
established prior to taking or suffering any action to be taken hereunder,
such matter (unless other evidence in respect thereof be herein
specifically prescribed) may, in the absence of no negligence or bad faith
on the part of the Trustee, be deemed to be conclusively proved and
established by an Issuer's Certificate delivered to the Trustee and such
certificate, in the absence of no negligence or bad faith on the part of
the Trustee, shall be full warrant to the Trustee for any action taken,
suffered or omitted by it under the provisions of this Indenture upon the
faith thereof.
(i) At any and all reasonable times, the Trustee, and its duly
authorized agents, attorneys, experts, engineers, accountants and
representatives, shall have the right fully to inspect all books, papers
and records of the Issuer pertaining to the Financed Student Loans, and to
take such memoranda from and in regard thereto as may be desired.
(j) The Trustee shall not be required to give any bond or surety in
respect of the execution of the said trusts and powers or otherwise in
respect of the premises.
(k) Notwithstanding anything elsewhere in this Indenture contained,
the Trustee, in respect to the authentication of any Notes, the withdrawal
of any cash or any action whatsoever within the purview of this Indenture,
and any Authenticating Agent, in respect of the authentication of Notes,
shall have the right, but shall not be required, to demand any showings,
certificates, opinions (including opinions of Counsel), appraisals or other
information, or corporate action or evidence thereof, in addition to that
by the terms hereof required as a condition of such action by the Trustee
or the Authenticating Agent, as the case may be, deemed desirable for the
purpose of establishing the right of the Issuer to the authentication of
any Notes, the withdrawal of any cash, or the taking of any other action by
the Trustee or the Authenticating Agent, as the case may be.
(l) Before taking any action hereunder requested by Noteholders or by
any Other Beneficiary, the Trustee may require that it be furnished an
indemnity bond or other indemnity satisfactory to it for the reimbursement
of all expenses to which it may be put and to protect it against all
liability, except liability which results from the negligence or willful
misconduct of the Trustee, by reason of any action so taken by the Trustee.
(m) The Trustee shall periodically file Uniform Commercial Code
continuation statements and take such other actions described in Section
4.10 hereof as required to maintain and continue the perfection of any
security interests granted by the Issuer and the Eligible Lender Trustee as
debtors to the Trustee as secured party hereunder.
(n) (n) Anything in this Indenture to the contrary notwithstanding, in
no event shall the Trustee be liable for special, indirect or consequential
loss or damage of any kind whatsoever (including but not limited to lost
profits).
SECTION 7.02. FEES, CHARGES AND EXPENSES OF THE TRUSTEE, PAYING AGENTS,
NOTE REGISTRAR, AUTHENTICATING AGENTS, REMARKETING AGENTS, TENDER AGENTS,
AUCTION AGENTS, MARKET AGENTS AND BROKER-DEALERS. The Trustee and each Paying
Agent, Note Registrar, Authenticating Agent, Remarketing Agent, Tender Agent,
Auction Agent, Market Agent and Broker-Dealer shall be entitled to payment
and/or reimbursement for reasonable fees for services rendered hereunder
(monthly in the case of the Trustee) and all advances, legal fees and other
expenses reasonably and necessarily made or incurred by it in and about the
execution of the trusts created by this Indenture and in and about the exercise
and performance of the powers and duties of the Trustee and each Paying Agent,
Note Registrar, Authenticating Agent, Remarketing Agent, Tender Agent, Auction
Agent, Market Agent and Broker-Dealer hereunder and for the reasonable and
necessary costs and expenses incurred in defending any liability in the premises
of any character whatsoever (unless such liability is adjudicated to have
resulted from the negligence or willful misconduct of the Trustee, the Paying
Agent, the Note Registrar, the Authenticating Agent, the Remarketing Agent, the
Tender Agent, the Auction Agent, the Market Agent or the Broker-Dealer);
provided that any moneys or Investment Securities held pursuant to Section 9.01
hereof with respect to Notes no longer deemed Outstanding hereunder, shall not
be available for, nor be applied to, the payment of any such fees, advances,
costs or expenses. The right of the Trustee to payment under this Section 7.02
shall survive the satisfaction and discharge of this Indenture or the earlier
resignation or removal of the Trustee. As security for the performance of the
Issuer under this Section or Section 7.21 hereof, after the occurrence of a
Default the Trustee shall without further action or authorization have a lien
and a right to set-off, prior to the lien of the Noteholders and all other
Persons, upon the Trust Estate. When the Trustee incurs expenses after the
occurrence of a Default specified in Section 6.01 (o) or (p) with respect to the
Issuer, if the surviving entity has failed to honor such obligation the expenses
are intended to constitute expenses of administration under any insolvency law
or under Title 11 of the United States Code.
SECTION 7.03. NOTICE TO BENEFICIARIES IF DEFAULT OCCURS. The Trustee shall
give to all Beneficiaries, in the manner provided in Section 10.04 hereof,
notice of all Events of Default, and of all events which, with the passage of
time or the giving of notice, or both, would become an Event of Default, known
to the Trustee, within 90 days after the occurrence of such Event of Default or
other event unless such Event of Default or other event shall have been cured
before the giving of such notice; provided that, except in the case of Events of
Default in the payment of the principal of, premium, if any, or interest on any
of the Notes, the Trustee shall be protected in withholding such notice if and
so long as a trust committee of the Trustee in good faith determines that the
withholding of such notice is in the interest of the Beneficiaries.
SECTION 7.04. INTERVENTION BY TRUSTEE. In any judicial proceeding to which
the Issuer is a party and which in the opinion of the Trustee and its Counsel
has a substantial bearing on the interest of the Beneficiaries, the Trustee may
intervene on behalf of Beneficiaries and shall do so if requested in writing by
the Acting Beneficiaries Upon Default. The rights and obligations of the Trustee
under this Section 7.04 are subject to the approval of a court of competent
jurisdiction in the premises.
SECTION 7.05. SUCCESSOR TRUSTEE, PAYING AGENTS, AUTHENTICATING AGENTS, AND
TENDER AGENTS. Any corporation, association or agency into which the Trustee and
any Paying Agent, any Authenticating Agent or any Tender Agent may be converted
or merged, or with which it may be consolidated, or to which it may sell or
transfer its trust business and assets as a whole or substantially as a whole,
or any corporation or association resulting from any such conversion, sale,
merger, consolidation or transfer to which it is a party, ipso facto, shall be
and become successor Trustee, Paying Agent, Note Registrar, Authenticating
Agent, or Tender Agent hereunder and vested with all of the trusts, powers,
discretions, immunities, privileges and all other matters as was its
predecessor, without the execution or filing of any instrument or any further
act, deed or conveyance on the part of any of the parties hereto, anything
herein to the contrary notwithstanding; provided that no such merger, conversion
or consolidation shall relieve the Trustee of its obligation to comply with
Section 7.13 hereof.
SECTION 7.06. RESIGNATION BY TRUSTEE, PAYING AGENTS, AUTHENTICATING AGENTS,
AND TENDER Agents. The Trustee, any Paying Agent, any Authenticating Agent and
any Tender Agent may at any time resign from the trusts and be discharged of the
duties and obligations hereby created by giving 60 days' written notice to the
Issuer and, in the case of the Trustee, a Paying Agent, an Authenticating Agent
or a Tender Agent, by first-class mail to all Noteholders and Other
Beneficiaries and such resignation shall take effect upon the appointment of a
successor Trustee, Paying Agent, Authenticating Agent or Tender Agent. No such
resignation of the Trustee shall become effective until the acceptance of
appointment by a successor Trustee under Section 7.09 hereof. Upon the
appointment and acceptance of a successor Trustee, the successor Trustee shall
or upon appointment and acceptance of a successor Authenticating Agent, Paying
Agent or Tender Agent, the Trustee shall, promptly cause written notice of such
appointment to be given to all Noteholders and Other Beneficiaries in the manner
provided in Section 10.04 hereof, which notice shall include the address of the
Principal Office of such successor. If an instrument of acceptance by a
successor Trustee, Paying Agent, Authenticating Agent or Tender Agent shall not
have been delivered to the resigning Trustee, Paying Agent, Authenticating Agent
or Tender Agent within 60 days after the giving of such notice of resignation,
the resigning Trustee, Paying Agent, Authenticating Agent or Tender Agent may
petition any court of competent jurisdiction for the appointment of a successor
and any attorneys' fees incurred in connection with any such petition shall be
payable by the Issuer.
SECTION 7.07. REMOVAL OF TRUSTEE. The Issuer may at any time, subject to
the provisions of this Article VII, remove the Trustee by Issuer Order. The
Issuer shall remove the Trustee if at any time so requested by an instrument or
concurrent instruments in writing, filed with the Trustee and the Issuer, and
signed by the Holders of a majority in Principal Amount of the Notes then
Outstanding or their attorneys-in-fact duly authorized. Notwithstanding the
foregoing, the Trustee may not be removed during the existence of an Event of
Default.
In case the Trustee shall be dissolved, fail to comply with Section 7.13
hereof or otherwise become incapable of acting hereunder, or in case it shall be
taken under the control of any public officer or officers, or of a receiver
appointed by a court, any Noteholder may petition any court of competent
jurisdiction for the removal of the Trustee and the appointment of a successor
Trustee.
No removal of the Trustee, and no appointment of a successor Trustee,
pursuant to the provisions of this Article VII shall become effective until the
acceptance of appointment by the successor Trustee under Section 7.09 hereof.
SECTION 7.08. APPOINTMENT OF SUCCESSOR TRUSTEE. If the Trustee shall
resign, be removed or become incapable of acting, or if a vacancy shall occur in
the office of Trustee for any cause, the Issuer shall, by Issuer Order, promptly
appoint a successor trustee. If no successor trustee has been appointed and
accepted appointment as herein provided after 60 days from the mailing of notice
of resignation by the Trustee under Section 7.06 hereof, or from the date the
Trustee is removed or otherwise incapable of acting hereunder, any Beneficiary
or the Trustee may petition a court of competent jurisdiction to appoint a
successor trustee. No appointment of a successor Trustee shall be effective
without the written consent of all Other Beneficiaries, which consent shall not
be unreasonably withheld.
The Issuer shall promptly notify any Paying Agent, Authenticating Agent,
Remarketing Agent and Tender Agent as to the appointment of any successor
trustee and shall promptly cause written notice of such appointment to be given
to all Noteholders and Other Beneficiaries in the manner provided in Section
10.04 hereof, which notice shall include the address of the Principal Office of
the successor Trustee.
SECTION 7.09. CONCERNING ANY SUCCESSOR TRUSTEE. Every successor Trustee
appointed hereunder shall execute, acknowledge and deliver to its predecessor,
and to the Issuer, an instrument in writing accepting such appointment
hereunder, and thereupon such successor, without any further act, assignment or
conveyance, shall become fully vested with all the estates, properties, rights,
powers, trusts, duties and obligations of its predecessor as Trustee; but such
predecessor shall, nevertheless, on the written request of the Issuer, or of its
successor Trustee, execute and deliver an instrument transferring to such
successor Trustee all the estates, properties, rights, powers and trusts of such
predecessor hereunder, and every predecessor Trustee shall deliver all
securities and moneys and Balances held by it as Trustee hereunder to its
successor together with an accounting of the Balances held by it hereunder and
shall take such actions as may be necessary to cause any Credit Enhancement
Facility to be transferred to the successor Trustee. Should any instrument in
writing from the Issuer be required by any successor Trustee for more fully and
certainly vesting in such successor the estates, rights, powers and duties
hereby vested or intended to be vested in the predecessor trustee, any and all
such instruments in writing shall, on request, be executed, acknowledged and
delivered by the Issuer.
SECTION 7.10. TRUSTEE PROTECTED IN RELYING UPON RESOLUTIONS, ETC. The
resolutions, orders, requisitions, opinions, certificates and other instruments
conforming to the requirements of this Indenture may be accepted by the Trustee
as conclusive evidence of the facts and conclusions stated therein and shall be
full warrant, protection and authority to the Trustee for the withdrawal of cash
hereunder.
SECTION 7.11. SUCCESSOR TRUSTEE AS CUSTODIAN OF FUNDS. In the event of a
change in the office of Trustee the predecessor Trustee which has resigned or
been removed shall cease to be custodian of the Funds and Accounts, and the
successor Trustee shall be and become such custodian.
SECTION 7.12. CO-TRUSTEE. At any time or times, for the purpose of (a)
meeting any legal requirements of any state in which the Trustee determines it
necessary to take any action hereunder; or (b) establishing the eligibility of
any Financed Student Loans for receipt of federal payments with respect thereto,
the Trustee shall have power to appoint, and, upon the request of the Trustee or
of the Holders of at least 25% in aggregate Principal Amount of Notes
Outstanding or of any Other Beneficiary, the Issuer shall for such purpose join
with the Trustee in the execution, delivery and performance of all instruments
and agreements necessary or proper to appoint one or more Persons approved by
the Trustee either to act as co-trustee or co-trustees, jointly with the Trustee
of all or any part of the trust estate, or to act as separate trustee or
separate trustees of all or any part of the trust estate, and to vest in such
person or persons, in such capacity, such title to the trust estate or any part
thereof, and such rights, powers, duties, trusts or obligations as the Trustee
may consider necessary or desirable, subject to the remaining provisions of this
Section 7.12. No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor Trustee under Section 7.13 hereof
and no notice to Noteholders of the appointment of any co-trustee or separate
trustee shall be required under Section 7.08 hereof.
If the Issuer shall not have joined in such appointment within 15 days
after the receipt by it of a request so to do, or in case an Event of Default
shall have occurred and be continuing, the Trustee alone shall have power to
make such appointment.
The Issuer shall execute, acknowledge and deliver all such instruments as
may be required by any such co-trustee or separate trustee.
Every co-trustee or separate trustee shall, to the extent permitted by law
but to such extent only, be appointed subject to the following terms, namely:
(a) The Notes shall be authenticated and delivered, and all rights,
powers, trusts, duties and obligations by this Indenture conferred upon the
Trustee in respect of the custody, control and management of moneys,
papers, securities and other personal property shall be exercised, solely
by the Trustee.
(b) All rights, powers, trusts, duties and obligations conferred or
imposed upon the trustees shall be conferred or imposed upon and exercised
or performed by the Trustee, or by the Trustee and such co-trustee or
co-trustees or separate trustee or separate trustees jointly, as shall be
provided in the instrument appointing such co-trustee or co-trustees or
separate trustee or separate trustees, except to the extent that, under the
law of any jurisdiction in which any particular act or acts are to be
performed, the Trustee shall be incompetent or unqualified to perform such
act or acts, in which event such act or acts shall be performed by such
co-trustee or co-trustees or separate trustee or separate trustees.
(c) Any request in writing by the Trustee to any co-trustee or
separate trustee to take or to refrain from taking any action hereunder
shall be sufficient warrant for the taking, or the refraining from taking,
of such action by such co-trustee or separate trustee.
(d) Any co-trustee or separate trustee may delegate to the Trustee the
exercise of any right, power, trust, duty or obligations, discretionary or
otherwise.
(e) The Trustee at any time, by any instrument in writing, may accept
the resignation of or remove any co-trustee or separate trustee appointed
under this Section 7.12. Upon the request of the Trustee, the Issuer shall
join with the Trustee in the execution, delivery and performance of all
instruments and agreements necessary or proper to effectuate such
resignation or removal.
(f) No trustee hereunder shall be personally liable by reason of any
act or omission of any other trustee hereunder.
(g) Any demand, request, direction, appointment, removal, notice,
consent, waiver or other action in writing delivered to the Trustee shall
be deemed to have been delivered to each such co-trustee or separate
trustee.
(h) Any moneys, papers, securities or other items of personal property
received by any such co-trustee or separate trustee hereunder shall
forthwith, so far as may be permitted by law, be turned over to the
Trustee.
Upon the acceptance in writing of such appointment by any such co-trustee
or separate trustee, it or he or she shall be vested with such title to the
trust estate or any part thereof, and with such rights, powers, duties or
obligations, as shall be specified in the instrument of appointment jointly with
the Trustee (except insofar as local law makes it necessary for any such
co-trustee or separate trustee to act alone) subject to all the terms of this
Indenture. Every such acceptance shall be filed with the Trustee. Any co-trustee
or separate trustee may, at any time by an instrument in writing, constitute the
Trustee, his, her or its attorney-in-fact and agent, with full power and
authority to do all acts and things and to exercise all discretion on his, her
or its behalf and in his, her or its name.
In case any co-trustee or separate trustee shall die, become incapable of
acting, resign or be removed, the title to the trust estate, and all rights,
powers, trusts, duties and obligations of said co-trustee or separate trustee
shall, so far as permitted by law, vest in and be exercised by the Trustee
unless and until a successor co-trustee or separate trustee shall be appointed
in the manner herein provided.
SECTION 7.13. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY; CONFLICTING
INTERESTS. There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee under TIA Section 310(a)(1) and shall have a combined
capital and surplus of at least $50,000,000 (and, with respect to any successor
Trustee, having a rating of at least "Baa3" from Moody's unless a Rating Agency
Condition is satisfied). If such corporation publishes reports of condition at
least annually, pursuant to law or the requirements of federal, state,
territorial or District of Columbia supervising or examining authority, then for
the purposes of this Section 7.13, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time the Trustee
shall cease to be eligible in accordance with the provisions of this Section
7.13, it shall resign immediately in the manner and with the effect specified in
this Article VII. Neither the Issuer nor any Person directly or indirectly
controlling or controlled by, or under common control with, the Issuer shall
serve as Trustee.
SECTION 7.14. STATEMENT BY TRUSTEE OF FUNDS AND ACCOUNTS AND OTHER MATTERS.
Not more than 30 days after the close of each Fiscal Year the Trustee shall
furnish the Issuer and any Noteholder or Other Beneficiary filing with the
Trustee a written request for a copy, a statement setting forth (to the extent
applicable) in respect to such Fiscal Year, (a) all transactions relating to the
receipt, disbursement and application of all moneys received by the Trustee
pursuant to all terms of this Indenture; (b) the Balances held by the Trustee at
the end of such Fiscal Year to the credit of each Fund and Account; (c) a brief
description of all moneys, Financed Student Loans and Investment Securities held
by the Trustee as part of the Balance of each Fund and Account as of the end of
such Fiscal Year; (d) the Principal Amount of Notes of each series purchased by
the Trustee during such Fiscal Year from moneys available therefor in any Fund
pursuant to the provisions of this Indenture and the respective purchase price
of such Notes; (e) the Principal Amount of Notes of each series retired, at
their Stated Maturity or by prepayment, during such Fiscal Year and the
Prepayment Prices thereof, if any; and (f) any other information which the
Issuer may reasonably request.
In addition, the Trustee shall furnish to the Issuer and the Market Agent
on or before the fifteenth day of each calendar month a brief description of all
moneys, Financed Student Loans and Investment Securities to the credit of each
Fund and Account as of the last day of the preceding month.
SECTION 7.15. TRUSTEE, AUTHENTICATING AGENT, NOTE REGISTRAR, PAYING AGENTS,
REMARKETING AGENTS, TENDER AGENTS, AUCTION AGENTS, MARKET AGENTS AND
BROKER-DEALERS MAY BUY, HOLD, SELL OR DEAL IN NOTES. The Trustee, any
Authenticating Agent, any Note Registrar, any Paying Agent, any Remarketing
Agent, any Tender Agent, any Auction Agent, any Market Agent or any
Broker-Dealer and its directors, officers, employees or agents may, in good
faith, buy, sell, own, hold and deal in any of the Notes and may join in any
action which any Holder of a Note may be entitled to take, with like effect as
if such Trustee, Authenticating Agent, Note Registrar, Paying Agent, Remarketing
Agent, Tender Agent, Auction Agent, Market Agent or Broker-Dealer were not the
Trustee, an Authenticating Agent, a Note Registrar, a Paying Agent, a
Remarketing Agent, a Tender Agent, an Auction Agent, a Market Agent or a
Broker-Dealer, as the case may be, under this Indenture.
SECTION 7.16. AUTHENTICATING AGENT AND PAYING AGENTS; PAYING AGENTS TO HOLD
MONEYS IN TRUST. Any Paying Agent for a series of Notes shall be appointed by or
pursuant to a Supplemental Indenture providing for the issuance of such series
of Notes. Each Paying Agent shall hold in trust for the benefit of the Holders
of the Notes and the Trustee any sums held by such Paying Agent for the payment
of the principal of, premium, if any, and interest on and any Carry-Over Amounts
(and accrued interest thereon) with respect to the Notes. Anything in this
paragraph to the contrary notwithstanding, the Issuer may, at any time, for the
purpose of obtaining a satisfaction and discharge of this Indenture, or for any
other reason, cause to be paid to the Trustee all sums held in trust by any
Paying Agent hereunder as required by this paragraph, such sums to be held by
the Trustee upon the trusts herein contained, and such Paying Agent shall
thereupon be released from all further liability with respect to such sums.
Any Authenticating Agent for a series of Notes shall be appointed by or
pursuant to a Supplemental Indenture providing for the issuance of such series
of Notes. The Authenticating Agent shall have the power to act in the receipt,
authentication and delivery of Notes in connection with transfers, exchanges and
registrations hereunder.
Each Authenticating Agent and Paying Agent other than the Trustee shall
designate its Principal Office and signify its acceptance of the duties and
obligations imposed upon it by this Indenture by executing and delivering to the
Issuer a written acceptance thereof under which, in the case of the Paying
Agent, the Paying Agent will agree particularly:
(a) to hold all sums held by it pursuant to this Indenture in trust
for the benefit of the Holders of the Notes until such sums shall be paid
to such Holders or otherwise disposed of as herein provided;
(b) at any time during the continuance of any Event of Default, upon
the written request of the Trustee, to forthwith pay to the Trustee all
sums so held in trust by such Paying Agent; and
(c) in the event of the resignation or removal of such Paying Agent,
pay over, assign and deliver any moneys, records or securities held by it
as Paying Agent to its successor or, if there be no successor, to the
Trustee.
No Paying Agent shall be obligated to expend its own funds in paying Debt
Service on, or Carry-Over Amounts (including accrued interest thereon) with
respect to, the Notes.
SECTION 7.17. REMOVAL OF AUTHENTICATING AGENT AND PAYING AGENTS;
SUCCESSORS. Any Authenticating Agent and any Paying Agent may be removed at any
time by an instrument filed with such Authenticating Agent or Paying Agent, as
the case may be, and the Trustee and signed by the Issuer. Any successor
Authenticating Agent or Paying Agent shall be appointed by the Issuer and shall
be a bank having trust powers or trust company duly organized under the laws of
any state of the United States or a national banking association having trust
powers, having, in the case of a successor paying agent, a capital stock and
surplus aggregating at least $25,000,000, and willing and able to accept the
office on reasonable and customary terms and authorized by law to perform all
the duties imposed upon it by this Indenture and any Supplemental Indenture.
Upon the appointment and acceptance of a successor Authenticating Agent or
Paying Agent, the Issuer shall promptly give written notice of such appointment
to the Trustee and the Trustee shall promptly cause written notice thereof to be
given to all Noteholders in the manner provided in Section 10.04 hereof, which
notice shall include the address of the Principal Office of such successor.
In the event of the resignation or removal of any Authenticating Agent or
any Paying Agent, such Authenticating Agent or Paying Agent shall pay over,
assign and deliver any moneys, records or securities held by it as
Authenticating Agent (and Note Registrar, if appropriate) or Paying Agent, as
the case may be, to its successors or, if there be no successor, to the Trustee.
SECTION 7.18. APPOINTMENT AND QUALIFICATIONS OF TENDER AGENTS. The Issuer
may, in a Supplemental Indenture, appoint a Tender Agent with respect to one or
more series of Notes. The Tender Agent shall, by entering into a Tender Agent
Agreement, designate to the Trustee its Principal Offices for the purposes of
its functions as Tender Agent and, if applicable, Authenticating Agent and Note
Registrar hereunder and signify its acceptance of the duties and obligations
imposed upon it hereunder (including, if applicable, those of Authenticating
Agent and Note Registrar) and under the Tender Agent Agreement, and under which
the Tender Agent will agree, particularly:
(a) to hold all Notes delivered to it hereunder in trust for the
benefit of the respective Noteholders which shall have so delivered such
Notes until moneys representing the purchase price of such Notes shall have
been delivered to or for the account of or to the order of such
Noteholders;
(b) to hold all moneys delivered to it hereunder for the purchase of
Notes in trust for the benefit of the person or entity which shall have so
delivered such moneys until the Notes purchased with such moneys shall have
been delivered to or for the account of such person or entity; and
(c) to keep such books and records as shall be consistent with prudent
industry practice and to make such books and records available for
inspection by the Issuer and the Trustee at all reasonable times.
The Issuer shall cooperate with the Tender Agent and the Trustee to cause
the necessary arrangements to be made and to be thereafter continued whereby
funds from the sources specified herein will be made available for the purchase
of the Notes which are required to be tendered on a Tender Date and whereby
Notes, executed by the Issuer and authenticated by the Trustee or the
Authenticating Agent, shall be made available to the Remarketing Agent, the
Trustee or the Tender Agent to the extent necessary for delivery pursuant the
applicable provisions of the related Supplemental Indenture.
The Tender Agent shall be a commercial bank or trust company duly organized
under the laws of the United States or any state or territory thereof, having
its Principal Office for the performance of its functions as Tender Agent
hereunder located in New York, New York, having a combined capital stock,
surplus and undivided profits of at least $100,000,000 and authorized by law to
perform all the duties imposed upon it by this Indenture (including, if
applicable, those of Authenticating Agent and Note Registrar) and the Tender
Agent Agreement. The Tender Agent may at any time resign and be discharged of
the duties and obligations created by this Indenture and the Tender Agent
Agreement (including such duties and obligations as Note Registrar and
Authenticating Agent hereunder) by giving at least 60 days' notice to the
Issuer, the Trustee and any related Credit Facility Provider, provided that such
resignation shall not be effective until the appointment of a successor Tender
Agent by the Issuer. The Tender Agent may be replaced at any time, at the
direction of the Issuer, by an instrument, signed by an Authorized Officer of
the Issuer, filed with the Remarketing Agent, the Tender Agent, the Trustee and
any related Credit Facility Provider at least 60 days prior to the effective
date of such replacement, provided that such replacement shall not be effective
until the appointment of a successor Tender Agent by the Issuer. Upon the
appointment and acceptance of a successor Tender Agent, the Issuer shall
promptly give written notice of such appointment to the Trustee and the Trustee
shall promptly cause written notice thereof to be given to all Noteholders in
the manner provided in Section 10.04 hereof, which notice shall include the
address of the Principal Office of such successor.
In the event of the resignation or removal of the Tender Agent, the Tender
Agent shall pay over, assign and deliver any moneys, Notes and records held by
it in such capacity (including any such moneys, Notes and records held by it as
Authenticating Agent and Note Registrar) to its successor or, if there be no
successor, to the Trustee.
In the event that the Tender Agent shall be removed or be dissolved, or if
the property or affairs of the Tender Agent shall be taken under the control of
any state or federal court or administrative body because of bankruptcy or
insolvency, or for any other reason, and the Issuer shall not have appointed its
successor as Tender Agent, the Trustee, notwithstanding the foregoing provisions
of this Section 7.18, shall ipso facto be deemed to be the Tender Agent for all
purposes of this Indenture until the appointment by the Issuer of the successor
Tender Agent, and the Trustee shall be required to perform the functions of the
Tender Agent (and, if applicable, of Note Registrar and Authenticating Agent) as
set forth in this Indenture and the Tender Agent Agreement.
SECTION 7.19. REMARKETING AGENTS. The Issuer may, in a Supplemental
Indenture, appoint a Remarketing Agent with respect to one or more series of
Notes. The Remarketing Agent shall designate its Principal Office and signify
its acceptance of the duties and obligations imposed upon it hereunder by
entering into a Remarketing Agreement under which the Remarketing Agent will
agree, particularly:
(a) to determine any variable interest rate in accordance with the
applicable provisions of the related Supplemental Indenture;
(b) to determine any fixed interest rate in accordance with the
applicable provisions of the related Supplemental Indenture;
(c) to hold all Notes delivered to it hereunder in trust for the
benefit of the respective Noteholders which shall have so delivered such
Notes until moneys representing the purchase price of such Notes shall have
been delivered to or for the account of or to the order of such
Noteholders;
(d) to hold all moneys delivered to it hereunder for the purchase of
Notes in trust for the benefit of the person or entity which shall have so
delivered such moneys until the Notes purchased with such moneys shall have
been delivered to or for the account of such person or entity; and
(e) to keep such books and records as shall be consistent with prudent
industry practice and to make such books and records available for
inspection by the Issuer and the Trustee at all reasonable times.
SECTION 7.20. QUALIFICATIONS OF REMARKETING AGENTS. The Remarketing Agent
shall be a member of the National Association of Securities Dealers, Inc., have
a capitalization of at least $50,000,000 and be authorized by law to perform all
the duties imposed upon it by this Indenture and the Remarketing Agreement. The
Remarketing Agent may at any time resign and be discharged of the duties and
obligations created by this Indenture and the Remarketing Agreement (a) by
giving at least 60 days' notice to the Issuer, the Trustee, the Tender Agent and
any related Credit Facility Provider, provided that such resignation shall not
be effective until a successor Remarketing Agent has been appointed by the
Issuer and any related Credit Facility Provider has consented in writing
thereto, which consent shall not be unreasonably withheld; or (b) by giving
notice to the Issuer, the Trustee and the Tender Agent under the circumstances
set forth in the Remarketing Agreement. The Remarketing Agent may be replaced at
any time, at the direction of the Issuer, by an instrument signed by an
Authorized Officer of the Issuer, filed with the Remarketing Agent, the Trustee,
the Tender Agent and any related Credit Facility Provider, provided that such
replacement shall not be effective until a successor Remarketing Agent has been
appointed by the Issuer and any related Credit Facility Provider has consented
in writing thereto, which consent shall not be unreasonably withheld.
In the event of the resignation or removal of the Remarketing Agent, the
Remarketing Agent shall pay over, assign and deliver any moneys and Notes held
by it in such capacity to its successor or, if there be no successor, to the
Trustee.
In the event that the Remarketing Agent shall resign, be removed or be
dissolved, or if the property or affairs of the Remarketing Agent shall be taken
under the control of any state or federal court or administrative body because
of bankruptcy or insolvency, or for any other reason, and the Issuer shall not
have appointed its successor as Remarketing Agent, the Trustee, notwithstanding
the provisions of the first paragraph of this Section 7.20, shall ipso facto be
deemed to be the Remarketing Agent for all purposes of this Indenture until the
appointment by the Issuer of the successor Remarketing Agent; provided, however,
that the Trustee, in its capacity as Remarketing Agent, shall not be required to
sell Notes or to determine the interest rate on the Notes. Nothing in this
Section 7.20 shall be construed as conferring on the Trustee additional duties
other than as set forth herein.
SECTION 7.21. INDEMNIFICATION OF THE TRUSTEE. The Issuer agrees to
indemnify and hold harmless the Trustee and its officers, directors, employees,
representatives and agents from and against, and reimburse the Trustee for, any
and all loss, liability, claims, obligations, damages, injuries, (to person,
property or natural resources), penalties, stamp or other similar taxes,
actions, suits, judgments, reasonable costs and expenses (including reasonable
agents fees and expenses) of whatever kind or nature regardless of their merit
incurred without negligence or bad faith on its part, arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including without limitation the costs and expenses of defending
itself against any claim or liability in connection with the exercise or
performance of any of its powers or duties hereunder; provided, however, that
any such indemnification shall be payable solely out of the Trust Estate. The
provisions of this Section 7.21 shall survive the termination of this agreement
or the earlier resignation or removal of the Trustee.
ARTICLE VIII
SUPPLEMENTAL INDENTURES
SECTION 8.01. SUPPLEMENTAL INDENTURES NOT REQUIRING CONSENT OF
BENEFICIARIES. The Issuer and the Trustee may, from time to time and at any
time, without the consent of, or notice to, any of the Noteholders or any Other
Beneficiary (except to the extent, if any, required pursuant to a Supplemental
Indenture authorizing the issuance of a series of Notes), and when so required
by this Indenture shall, enter into an indenture or indentures supplemental to
this Indenture as shall not be inconsistent with the terms and provisions hereof
(which Supplemental Indenture or Indentures shall thereafter form a part
hereof), so as to thereby (a) cure any ambiguity or formal defect or omission in
this Indenture or in any Supplemental Indenture; (b) grant to or confer upon the
Trustee for the benefit of the Beneficiaries any additional rights, remedies,
powers, authority or security that may lawfully be granted to or conferred upon
the Beneficiaries or the Trustee; (c) describe or identify more precisely any
part of the Trust Estate or subject additional revenues, properties or
collateral to the lien and pledge of this Indenture; (d) evidence the
appointment of a separate trustee or a co-trustee or the succession of a new
Trustee hereunder; (e) authorize issuance of a series of Notes, subject to the
requirements of Article II hereof; (f) modify, eliminate and/or add to the
provisions of this Indenture to such extent as shall be necessary to effect the
qualification of this Indenture under the Trust Indenture Act of 1939, as then
amended, or under any similar Federal statute enacted after the date of this
Indenture, and to add to this Indenture such other provisions as may be
expressly permitted by said Trust Indenture Act of 1939, excluding, however, the
provisions referred to in Section 316(a)(2) of said Trust Indenture Act of 1939;
(g) modify this Indenture (including deletions of or changes to provisions of
this Indenture or additions to this Indenture or any combination of deletions,
changes and additions) as required by any Credit Facility Provider or Swap
Counterparty, or otherwise necessary to give effect to any Credit Enhancement
Facility, Swap Agreement or Swap Counterparty Guaranty authorized to be obtained
or entered into under Section 2.12 hereof, at the time of issuance of a series
of Notes to which such agreements relate; provided that the Rating Agency
Condition is met with respect to such modifications; and provided further that
no such modifications shall be effective (i) if the consent of any Noteholders
would be required therefor under the proviso contained in Section 8.02 hereof
and such consent has not been obtained; or (ii) if the Trustee shall determine
that such modifications are to the prejudice of any Other Beneficiary; (h)
create additional Funds, Accounts or subaccounts as authorized by Section 4.01
hereof; (i) to provide for the creation of one or more additional classes of
Notes or Other Obligations; provided, (i) that no such class of Notes or Other
Obligations may be senior in any respect to any previously created such class of
Notes or Other Obligations any of which are then Outstanding, except to the
extent specifically authorized or permitted by the Supplemental Indenture
authorizing such previously created class or except to the extent consented to
by each Beneficiary who would be adversely affected thereby; and (ii) that the
Rating Agency Condition is met with respect to such additional classes of Notes
or Other Obligations; (j) make any other change in this Indenture if the Rating
Agency Condition shall have been satisfied with respect thereto and the Rating
Agency shall have received either a certificate of an Authorized Officer of the
Issuer that such change is not to the material prejudice of the Beneficiaries or
an opinion of counsel to the effect that such change is not to the material
prejudice of the Beneficiaries; or (k) make any other change if the Trustee
shall have received an opinion of counsel to the effect that such change is not
to the material prejudice of the Beneficiaries.
SECTION 8.02. SUPPLEMENTAL INDENTURES REQUIRING CONSENT OF BENEFICIARIES.
Exclusive of Supplemental Indentures covered by Section 8.01 hereof and subject
to the terms and provisions contained in this Section 8.02, and not otherwise,
the Trustee (upon receipt of an instrument evidencing the consent to the
below-mentioned Supplemental Indenture by: (a) if they are affected thereby, the
Holders of not less than two-thirds of the aggregate Principal Amount of the
Outstanding Senior Notes; (b) if they are affected thereby, the Holders of not
less than two-thirds of the aggregate Principal Amount of the Outstanding
Subordinate Notes; (c) if they are affected thereby, the Holders of not less
than two-thirds of the Aggregate Principal Amount of the Outstanding Junior
Subordinate Notes; and (d) each other Person which must consent to such
Supplemental Indenture as provided in any then outstanding Supplemental
Indenture authorizing the issuance of a series of Notes or any Other Obligation)
shall join with the Issuer in the execution of such other indenture or
indentures supplemental hereto as shall be deemed necessary and desirable for
the purpose of modifying, altering, amending, adding to or rescinding, in any
particular, any of the terms or provisions contained in this Indenture;
provided, however, that nothing contained in this Article VIII shall permit or
be construed as permitting without the consent of the Holder of each Note and
each Other Beneficiary which would be affected thereby (i) an extension of the
maturity of the principal of or the interest on any Note, whether at the Stated
Maturity thereof, on a Sinking Fund Payment Date or otherwise; or (ii) a
reduction in the Principal Amount, Prepayment Price or purchase price of any
Note or the rate of interest thereon; or (iii) a privilege or priority of any
Senior Obligation over any other Senior Obligation; (iv) a privilege or priority
of any Subordinate Obligation over any other Subordinate Obligation; or (v) a
privilege of any Senior Notes over any Subordinate Notes or Junior Subordinate
Notes, other than as provided herein; or (vi) a privilege of any Subordinate
Notes over any Junior Subordinate Notes, other than as provided herein; or (vii)
the surrendering of a privilege or a priority granted hereby if, in the judgment
of the Trustee, to the detriment of another Beneficiary hereunder; or (viii) a
reduction or an increase in the aggregate Principal Amount of the Notes required
for consent to such Supplemental Indenture; or (ix) the creation of any lien
ranking prior to or on a parity with the lien of this Indenture on the Trust
Estate or any part thereof, except as hereinbefore expressly permitted; or (x)
any Beneficiary to be deprived of the lien hereby created on the rights, title,
interest, privileges, revenues, moneys and securities pledged hereunder; or (xi)
the modification of any of the provisions of this Section 8.02; or (xii) the
modification of any provision of a Supplemental Indenture which states that it
may not be modified without the consent of the Holders of Notes issued pursuant
thereto or any Notes of the same class or any Beneficiary that has provided a
Credit Enhancement Facility or Swap Agreement of such class.
For purposes of this Indenture, Notes are deemed "affected" by an amendment
if such amendment adversely affects or diminishes the rights of the Holders
thereof to be assured of the payment of principal of, premium, if any, and
interest on and any Carry-Over Amount (and accrued interest thereon) with
respect to such Notes, taking into account the priorities between classes of
Notes theretofore prescribed hereby. The Trustee may in its discretion determine
whether any Notes would be affected by any amendment and any such determination
shall be conclusive upon the Holders of all Notes, whether theretofore or
thereafter authenticated and delivered under this Indenture. The Trustee shall
not be liable for any such determination made in good faith.
If at any time the Issuer shall request the Trustee to enter into any such
Supplemental Indenture for any of the purposes of this Section 8.02, the Trustee
shall, upon being satisfactorily indemnified with respect to expenses, cause
notice of the proposed execution of such Supplemental Indenture to be mailed to
each Holder of an Outstanding Note in accordance with the provisions of Section
10.04 hereof and to each Other Beneficiary. Such notice shall briefly set forth
the nature of the proposed Supplemental Indenture and shall state that copies
thereof are on file at the Principal Office of the Trustee for inspection by all
Beneficiaries. The Trustee shall not, however, be subject to any liability to
any Noteholder or any Other Beneficiary by reason of its failure to mail such
notice, and any such failure shall not affect the validity of such Supplemental
Indenture when consented to and approved as provided in this Section 8.02. If,
at the time of the execution of any such Supplemental Indenture, the Holders of
Notes and each other Beneficiary shall have consented to and approved the
execution thereof as herein provided, no Beneficiary shall have any right to
object to any of the terms and provisions contained therein, or the operation
thereof, or in any manner to question the propriety of the execution thereof, or
to enjoin or restrain the Trustee or the Issuer from executing the same or from
taking any action pursuant to the provisions thereof. Upon the execution of any
such Supplemental Indenture as in this Section 8.02 permitted and provided this
Indenture shall be and be deemed to be modified and amended in accordance
therewith.
SECTION 8.03. RIGHTS OF TRUSTEE. If, in the opinion of the Trustee, any
Supplemental Indenture provided for in this Article VIII adversely affects the
rights, duties or immunities of the Trustee under this Indenture or otherwise,
the Trustee may, in its discretion, decline to execute such Supplemental
Indenture. The Trustee shall be entitled to receive, and shall be fully
protected in relying upon, an opinion of its Counsel as conclusive evidence that
any such Supplemental Indenture conforms to the requirements of this Indenture.
SECTION 8.04. NOTICE OF DEFAULTS. Within 90 days after the occurrence of
any default hereunder with respect to the Notes, the Trustee shall transmit in
the manner and to the extent provided in TIA Section 313(c), notice of such
default hereunder to which a Responsible Officer of the Trustee has actual
knowledge or is in receipt of a written notice thereof in accordance with the
terms of this Indenture, unless such default shall have been cured or waived;
provided, however, that, except in the case of a default in the payment of the
principal of (or premium, if any) or interest with respect to any Note, or in
the payment of any sinking fund installment with respect to the Notes, the
Trustee shall be protected in withholding such notice if and so long as an
authorized officer of the Trustee in good faith determines that the withholding
of such notice is in the interest of the Noteholders. For the purpose of this
Section 8.04, the term "default" means any event which is, or after notice or
lapse of time or both would become, an Event of Default with respect to the
Notes.
SECTION 8.05. CONFORMITY WITH THE TRUST INDENTURE ACT. Every Supplemental
Indenture executed pursuant to this Article VIII shall conform to the
requirements of the TIA as then in effect.
SECTION 8.06. CONSENT OF TENDER AGENTS. So long as any Tender Agent
Agreement is in effect, (a) no Supplemental Indenture which materially adversely
affects the rights, duties or immunities of the Tender Agent created by this
Indenture or the Tender Agent Agreement (including, if applicable, such duties
and obligations as Note Registrar and Authenticating Agent hereunder) shall
become effective unless and until delivery to the Trustee of a written consent
of the Tender Agent to such Supplemental Indenture; and (b) the Trustee shall
promptly furnish to the Tender Agent a copy of each Supplemental Indenture.
SECTION 8.07. CONSENT OF REMARKETING AGENTS. So long as any Remarketing
Agreement is in effect, (a) no Supplemental Indenture which materially adversely
affects the rights, duties or immunities of the Remarketing Agent created by
this Indenture or the Remarketing Agreement shall become effective unless and
until delivery to the Trustee of a written consent of the Remarketing Agent to
such Supplemental Indenture; and (b) the Trustee shall promptly furnish to the
Remarketing Agent a copy of each Supplemental Indenture.
SECTION 8.08. CONSENT OF AUCTION AGENTS. So long as any Auction Agent
Agreement is in effect, (a) no Supplemental Indenture which materially adversely
affects the rights, duties or immunities of the Auction Agent created by this
Indenture or the Auction Agent Agreement shall become effective unless and until
delivery to the Trustee of a written consent of the Auction Agent to such
Supplemental Indenture; and (b) the Trustee shall promptly furnish to the
Auction Agent a copy of each Supplemental Indenture.
SECTION 8.09. CONSENT OF BROKER-DEALERS. So long as any Broker-Dealer
Agreement is in effect, (a) no Supplemental Indenture which materially adversely
affects the rights, duties or immunities of the Broker-Dealer created by this
Indenture or the Broker-Dealer Agreement shall become effective unless and until
delivery to the Trustee of a written consent of the Broker-Dealer to such
Supplemental Indenture; and (b) the Trustee shall promptly furnish to the
Broker-Dealer a copy of each Supplemental Indenture.
SECTION 8.10. CONSENT OF MARKET AGENTS. So long as any Market Agent
Agreement is in effect, (a) no Supplemental Indenture which materially adversely
affects the rights, duties or immunities of the Market Agent created by this
Indenture or the Market Agent Agreement shall become effective unless and until
delivery to the Trustee of a written consent of the Market Agent to such
Supplemental Indenture; and (b) the Trustee shall promptly furnish to the Market
Agent a copy of each Supplemental Indenture.
ARTICLE IX
DEFEASANCE; MONEYS HELD FOR PAYMENT OF DEFEASED NOTES
SECTION 9.01. DISCHARGE OF LIENS AND PLEDGES; NOTES NO LONGER OUTSTANDING
AND DEEMED TO BE PAID HEREUNDER. The obligations of the Issuer under this
Indenture, and the liens, pledges, charges, trusts, covenants and agreements of
the Issuer herein made or provided for, shall be fully discharged and satisfied
as to any Note and such Note shall no longer be deemed to be Outstanding
hereunder:
(a) when such Note shall have been canceled, or shall have been
purchased by the Trustee from moneys held by it under this Indenture; or
(b) as to any Note not canceled or so purchased, when payment of the
principal of and the applicable prepayment premium, if any, on such Note,
plus interest on such principal to the due date thereof (whether such due
date be by reason of Stated Maturity or upon prepayment, or otherwise);
either (i) shall have been made or caused to be made in accordance with the
terms hereof; or (ii) shall have been provided for by irrevocably
depositing with the Trustee and irrevocably appropriating and setting aside
exclusively for such payment; (A) moneys sufficient to make such payment;
or (B) Government Obligations maturing as to principal and interest in such
amount and at such times as will ensure the availability of sufficient
moneys to make such payment, and all necessary and proper fees,
compensation and expenses of the Trustee, any Remarketing Agents, any
Tender Agents, any Auction Agents, any Market Agents, any Broker-Dealers,
any Authenticating Agents, the Note Registrar and any Paying Agents
pertaining to the Note with respect to which such deposit is made shall
have been paid or the payment thereof provided for to the satisfaction of
the Trustee, said Remarketing Agents, said Tender Agents, said Auction
Agents, said Market Agents, said Broker-Dealers, said Authenticating
Agents, said Note Registrar and said Paying Agents.
Any deposit under the preceding clause (ii) shall be accompanied by an
Issuer Certificate certifying that the moneys and Government Obligations so
appropriated and set aside are sufficient, and will mature as needed, to pay the
principal, premium, if any, and interest due on the Note with respect to which
such deposit has been made on the Stated Maturity or Prepayment Date thereof and
on each Interest Payment Date on and prior to such Stated Maturity or Prepayment
Date. At such time as a Note shall be deemed to be no longer Outstanding
hereunder, as aforesaid, such Note shall cease to draw interest from the due
date thereof (whether such due date be by reason of Stated Maturity, or upon
prepayment or by declaration as aforesaid, or otherwise) and, except for the
purposes of any such payment from such moneys or Investment Securities, shall no
longer be secured by or entitled to the benefits of this Indenture.
Notwithstanding the foregoing, (a) in the case of Notes which by their
terms may be prepaid prior to their Stated Maturities, no deposit under clause
(ii) of subparagraph (b) above shall constitute such payment, discharge and
satisfaction as aforesaid, as to all such Notes which are to be paid prior to
their respective Stated Maturities, until proper notice of such prepayment shall
have been previously given in accordance with Section 3.04 hereof or provision
satisfactory to the Trustee shall have been irrevocably made for the giving of
such notice, and (b) in the case of Notes which may be required to be purchased
on a Tender Date, no deposit under clause (ii)(B) of subparagraph (b) above
shall constitute such payment, discharge and satisfaction as aforesaid.
Any such moneys so deposited with the Trustee as provided in this Section
9.01 may at the direction of the Issuer also be invested and reinvested in
Government Obligations maturing in the amounts and time as hereinbefore set
forth, and all income from all Government Obligations in the hands of the
Trustee pursuant to this Section 9.01 which is not required for the payment of
the Notes and interest and premium thereon with respect to which such moneys
shall have been so deposited shall (a) if any Notes are then Outstanding, be
deposited in the Collection Fund as and when realized and collected, for use and
application as are other moneys credited to such Fund and (b) if no Notes are
then Outstanding and no amounts are owed to any Other Beneficiaries hereunder,
be paid to the Issuer.
Notwithstanding the satisfaction and discharge of this Indenture with
respect to any Note, the right to transfer and exchange such Note pursuant to
Section 2.07, and any rights to have such Note purchased on a Tender Date, shall
survive.
Notwithstanding any provision of any other Section of this Indenture which
may be contrary to the provisions of this Section 9.01, all moneys or Investment
Securities set aside and held in trust pursuant to the provisions of this
Section 9.01 for the payment of the principal of, premium, if any, and interest
on Notes shall be applied to and used solely for the payment of the principal
of, premium, if any, and interest on the particular Note with respect to which
such moneys and Investment Securities have been so set aside in trust.
Anything in Article VIII hereof to the contrary notwithstanding, if moneys
or Government Obligations have been deposited or set aside with the Trustee
pursuant to this Section 9.01 for the payment of Notes and such Notes shall be
deemed to have been paid and to be no longer Outstanding hereunder as provided
in this Section 9.01, but such Notes shall not have in fact been actually paid
in full, no amendment to the provisions of this Article IX shall be made without
the consent of the Holder of each Note affected thereby.
The Issuer may at any time cause to be canceled any Notes previously
executed and delivered, which the Issuer may have acquired in any manner
whatever, and such Notes upon such surrender for cancellation shall be deemed to
be paid and no longer Outstanding hereunder.
The obligations of the Issuer under this Indenture, and the liens, pledges,
charges, trusts, covenants and agreements of the Issuer herein made or provided
for, shall be fully discharged and satisfied as to any Credit Enhancement
Facility or Swap Agreement in the manner and with the effect provided in the
Supplemental Indenture providing for such Credit Enhancement Facility or Swap
Agreement.
Notwithstanding the foregoing provisions of this Section 9.01, no Note
shall be defeased hereunder if, after giving effect to the defeasance, the
requirements in Section 3.02 hereof are not met on the date such Note is to be
defeased, treating, for purposes of said Section 3.02, any Note that is to be
defeased as being prepaid on the date it is to be defeased at an assumed
Prepayment Price equal to the Principal Amount thereof with interest accrued
thereon to the date of defeasance, plus, if the Note is to be prepaid under this
Section 9.01 at a Prepayment Price greater than the Principal Amount thereof, a
premium equal to the amount by which the Prepayment Price exceeds such Principal
Amount.
SECTION 9.02. NOTES NOT PRESENTED FOR PAYMENT WHEN DUE; MONEYS HELD FOR THE
NOTES AFTER DUE DATE OF NOTES. Subject to the provisions of the next sentence of
this paragraph, if any Note shall not be presented for payment when the
principal thereof shall become due, whether at Stated Maturity, at the date
fixed for redemption in full or otherwise, and if moneys or Investment
Securities described in subdivision (a) of the definition thereof in Section
1.01 hereof shall at such due date be held by the Trustee, or a Paying Agent
therefor, in trust for that purpose sufficient and available to pay the
principal of and premium, if any, on such Note, together with all interest due
on such principal to the due date thereof or to the date fixed for redemption
thereof, all liability of the Issuer for such payment shall forthwith cease,
determine and be completely discharged, and thereupon it shall be the duty of
the Trustee, or such Paying Agent, to hold said moneys or Investment Securities
without liability to the Holder of such Note for interest thereon, in trust for
the benefit of the Holder of such Note, who thereafter shall be restricted
exclusively to said moneys or Investment Securities for any claim of whatever
nature on his, her or its part on or with respect to said Note, including any
claim for the payment thereof. In the event any such moneys or Investment
Securities, or any other moneys or Investment Securities with respect to
interest due and payable on any Note prior to the Maturity thereof, held by the
Trustee or any Paying Agent for the Holders of such Notes remain unclaimed as of
(a) 55 days after the principal of or interest on the respective Notes with
respect to which such moneys or Investment Securities have been so set aside has
become due and payable (whether at Stated Maturity, redemption or otherwise),
the Trustee shall, within five days thereafter, give notice thereof to the
Holders of such Notes in the same manner as a notice of redemption given in
accordance with Section 3.04 hereof; and (b) two years after the principal of or
interest on such Notes has become due and payable as aforesaid, the Trustee or
such Paying Agent, as the case may be, shall, without further request by the
Issuer, pay such moneys and Investment Securities, to the extent permitted by
law, to the Issuer against a written receipt therefor, and otherwise hold or
dispose of such moneys and Investment Securities as required by law; provided
that, if applicable law requires the Trustee or any Paying Agent to dispose of
any such moneys or Investment Securities prior to the end of the period
described in the preceding clause (b), disposition of such moneys and Investment
Securities shall be made at the time and otherwise in accordance with such law.
ARTICLE X
MISCELLANEOUS
SECTION 10.01. CONSENT, ETC., OF NOTEHOLDERS. Any consent, request,
direction, approval, objection or other instrument required by this Indenture to
be signed and executed by Noteholders may be in any number of writings of
similar tenor and may be signed or executed by such Noteholders in person or by
agent appointed in writing. Proof of the execution of any such consent, request,
direction, approval, objection or other instrument or of the writing appointing
any such agent and of the ownership of Notes, if made in the following manner,
shall be sufficient for any of the purposes of this Indenture, and shall be
conclusive in favor of the Issuer, any Paying Agent, any Remarketing Agent, any
Tender Agent, any Auction Agent, any Market Agent, any Broker-Dealer or the
Trustee with regard to any action taken by it under such consent, request,
direction, approval, objection or other instrument, namely:
(a) The fact and date of the execution by any person of any such
writing may be proved by the certificate of any officer in any jurisdiction
who by law has power to take acknowledgements within such jurisdiction that
the person signing such writing acknowledged before him the execution
thereof, or by an affidavit of any witness to such execution.
(b) The fact of ownership of Notes, the numbers and other
identification of such Notes, and the date of holding the same shall be
proved by the Note Register.
SECTION 10.02. LIMITATION OF RIGHTS. With the exception of rights herein
conferred, nothing expressed or mentioned in or to be implied from this
Indenture or the Notes is intended or shall be construed to give to any Person
other than the parties hereto, any Authenticating Agent, each Paying Agent, each
Remarketing Agent, each Tender Agent, each Auction Agent, each Market Agent,
each Broker-Dealer and the Beneficiaries, any legal or equitable right, remedy,
or claim under or in respect to this Indenture or any covenants, conditions and
provisions herein contained; this Indenture and all of the covenants, conditions
and provisions hereof being intended to be and being for the sole and exclusive
benefit of the parties hereto, any Authenticating Agent, each Paying Agent, each
Remarketing Agent, each Tender Agent, each Auction Agent, each Market Agent,
each Broker-Dealer and the Beneficiaries as herein provided.
SECTION 10.03. SEVERABILITY. If any provision of this Indenture shall be
held or deemed to be or shall, in fact, be inoperative or unenforceable as
applied in any particular case in any jurisdiction or jurisdictions or in all
jurisdictions or in all cases because it conflicts with any provisions of any
constitution or statute or rule of public policy, or for any other reason, such
circumstances shall not have the effect of rendering the provision in question
inoperative or unenforceable in any other case or circumstance, or of rendering
any other provision or provisions herein contained invalid, inoperative, or
unenforceable to any extent whatever.
The invalidity of any one or more phrases, sentences, clauses or paragraphs
in this Indenture contained shall not affect the remaining portions of this
Indenture or part thereof.
SECTION 10.04. NOTICES.
(a) All notices, certificates or other communications hereunder shall
be sufficiently given and shall be deemed given when mailed by certified
mail, postage prepaid, with proper address as indicated below or, as to
Other Beneficiaries, to a proper address specified in or pursuant to a
Supplemental Indenture. The Issuer, the Trustee and any Rating Agency may,
by written notice given by each to the others, designate any other address
or addresses to which notices, certificates or other communications to them
shall be sent when required as contemplated by this Indenture. Until
otherwise provided by the respective parties, all notices, certificates and
communications to each of them shall be addressed as follows:
To the Issuer: College Loan Corporation Trust I
c/o Wilmington Trust Company, as Delaware
Trustee
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attention: Corporate Trust Administration
with a copy to the General Counsel at the same address and a copy to
the Sponsor at the address below.
To the Eligible
Lender Trustee: Deutsche Bank Trust Company Americas
60 Wall Street
MS NYC 03-0918
New York, NY 10005
Attention: Corporate Trust & Agency Services
with a copy to: Deutsche Bank Trust Company Americas
280 Park Avenue
New York, NY 10005
Attention: Corporate Trust & Agency Services
To the Trustee: Deutsche Bank Trust Company Americas
60 Wall Street
MS NYC 03-0918
New York, NY 10017
Attention: Corporate Trust & Agency Services
with a copy to: Deutsche Bank Trust Company Americas
280 Park Avenue
New York, NY 10017
Attention: Corporate Trust & Agency Services
To the
Delaware Trustee: Wilmington Trust Company
Rodney Square North
1100 North Market Street
Wilmington, Delaware 19890-0001
Attention: Corporate Trust Administration
To the Sponsor: College Loan LLC
W. Bernardo Drive, Suite 270
San Diego, California 92127
Attention: Cary Katz
To S&P: Standard & Poor's, a division of The
McGraw-Hill Companies, Inc.
55 Water Street
New York, New York 10041
Attention: Asset-Backed Surveillance Group
To Moody's: Moody's Investors Service, Inc.
99 Church Street
4th Floor
New York, New York 10007
Attention: Structured Finance Group
(b) Except as is otherwise provided in this Indenture, any provision
in this Indenture for the mailing of notice or other instrument to Holders
of Notes shall be fully complied with if it is mailed by first-class mail,
postage prepaid, to each Holder of Notes outstanding at the address
appearing on the Note Register.
SECTION 10.05. COUNTERPARTS. This Indenture may be simultaneously executed
in several counterparts, each of which shall be an original and all of which
shall constitute but one and the same instrument.
SECTION 10.06. INDENTURE CONSTITUTES A SECURITY AGREEMENT. An executed
counterpart or certified copy of this Indenture delivered to and accepted by the
Trustee shall constitute a security agreement pursuant to and for all purposes
of the Uniform Commercial Code of the State of New York and of any other state
or jurisdiction.
SECTION 10.07. PAYMENTS DUE ON NON-BUSINESS DAYS. Except as may be
otherwise provided in a Supplemental Indenture, in any case where the principal
of, premium, if any, or interest on the Notes or amounts due to any Beneficiary
shall be due on a day other than a Business Day, then payment of such principal,
premium and interest may be made on the next succeeding Business Day with the
same force and effect as if made on the date due and no interest shall accrue
for the intervening period.
SECTION 10.08. NOTICES TO RATING AGENCIES. So long as any Outstanding Notes
are rated by a Rating Agency, the Trustee agrees to give the Rating Agency
prompt written notice of the appointment of any successor Trustee and copies of
any notices given pursuant to Articles VI or VII hereof.
SECTION 10.09. GOVERNING LAW. This Indenture shall be governed by and be
construed in accordance with the laws of the State of New York without giving
effect to the conflicts-of-laws principles thereof. This Indenture is subject to
the provisions of the TIA that are required to be part of this Indenture and
shall, to the extent applicable, be governed by such provisions.
SECTION 10.10. RIGHTS OF OTHER BENEFICIARIES. All rights of any Other
Beneficiary under this Indenture to consent to or direct certain remedies,
waivers, actions and amendments hereunder shall cease for so long as such Other
Beneficiary is in default of any of its obligations or agreements under the Swap
Agreement or the Credit Enhancement Facility by reason of which such Person is
an Other Beneficiary.
SECTION 10.11. SUBCONTRACTING BY ISSUER. The Issuer may contract with other
Persons to assist it in performing its duties under this Indenture, and any
performance of such duties by a Person identified to the Trustee in an Issuer
Certificate shall be deemed to be action taken by the Issuer.
SECTION 10.12. ROLE OF ELIGIBLE LENDER TRUSTEE. The Eligible Lender Trustee
has entered into this Indenture for the sole purpose of pledging, hypothecating,
assigning and granting a security interest in its right, title and interest in
the Financed Student Loans and related documentation and contracts, all as
provided in the Granting Clauses and Sections 5.07 and 5.15 hereof. The Eligible
Lender Trustee shall have no responsibility or liability for the payment of the
Note or the performance of any other obligation of the Issuer hereunder, except
to the extent of such pledge, hypothecation, assignment and grant.
SECTION 10.13. LIMITATION OF LIABILITY. It is expressly understood and
agreed by the parties hereto that (a) this Agreement is executed and delivered
by Wilmington Trust Company, not individually or personally but solely as
Delaware Trustee of the Issuer, in the exercise of the powers and authority
conferred and vested in it; (b) each of the representations, undertakings and
agreement herein made on the part of the Issuer is made and intended not as
personal representations, undertakings and agreements by Wilmington Trust
Company but is made and intended for the purpose of binding only the Issuer; (c)
nothing herein contained shall be construed as creating any liability on
Wilmington Trust Company, individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties hereto and by any Person claiming by, through or
under the parties hereto; and (d) under no circumstances shall Wilmington Trust
Company be personally liable for the payment of any indebtedness or expenses of
the Issuer or be liable for the breach or failure of any obligations,
representation, warranty or covenant made or undertaken by the Issuer under this
Indenture or any other related document.
ARTICLE XI
REPORTING REQUIREMENTS
SECTION 11.01. ANNUAL STATEMENT AS TO COMPLIANCE. The Issuer will cause
each Servicer to deliver to the Issuer Administrator, each Rating Agency and the
Trustee, on or before March 15 of each year, beginning with March 15, 2004, a
certificate dated as of December 31 of the preceding year stating that (a) a
review of the activities of the applicable Servicer during the preceding
calendar year (or, in the case of the first such certificate, during the period
from the Closing Date to December 31, 2003) and of its performance under the
applicable Servicing Agreement has been made under the supervision of the
officer signing such certificate; and (b) to the best of such officers'
knowledge, based on such review, the Servicer has fulfilled all its obligations
under the applicable Servicing Agreement throughout such year, or, there has
been a default in the fulfillment of any such obligation, specifying each such
default known to such officer and the nature and statue thereof.
SECTION 11.02. ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT.
Within 75 days of the end of each Servicer's regular fiscal-year or
calendar-year audit period, the Issuer shall cause each Servicer, at its
expense, to cause a firm of independent public accountants to furnish a
statement to each Rating Agency, the Issuer Administrator and the Trustee to the
effect that such firm has examined certain documents and records relating to the
servicing of the Financed Student Loans (during the preceding year) in
compliance with the standards for Compliance Audits Attestation Engagements for
Lenders and Lender Servicers Participating in the Federal Family Education Loan
Program and that, on the basis of such examination, such servicing has been
conducted in compliance with such servicing agreements except for such
significant exceptions or errors in records that, in the opinion of such firm,
requires it to report and which are set forth in such report.
SECTION 11.03. ISSUER ADMINISTRATOR'S CERTIFICATE. Each month, not later
than the fifteenth day of each month, the Issuer shall cause the Issuer
Administrator to deliver to the Trustee, an Officer's Certificate certifying to
the accuracy of the monthly statement contemplated by Section 11.04.
SECTION 11.04. STATEMENTS TO NOTEHOLDERS. On or before the fifteenth day of
each month, the Issuer shall provide or cause to be provided to the Trustee
(with a copy to the Rating Agencies), a statement setting forth information with
respect to the Notes and Financed Student Loans as of the end of the preceding
month, the following to the extent applicable:
(a) the amount of payments with respect to each series of Notes paid
with respect to principal during the preceding month;
(b) the amount of payments with respect to each series of Notes paid
with respect to interest during the preceding month;
(c) the amount of the payments allocable to any interest that was
carried over together with the amount of any remaining outstanding interest
that was carried over;
(d) the principal balance of Financed Student Loans as of the close of
business on the last day of the preceding month;
(e) the aggregate outstanding principal amount of the Notes of each
series as of the close of business on the last day of the preceding month,
after giving effect to payments allocated to principal reported under
paragraph (a) above;
(f) the interest rate for any series of variable rate Notes,
indicating how such interest rate is calculated;
(g) the amount of the servicing fees allocated to the Servicers as of
the close of business on the last day of the preceding month;
(h) the amount of the Administration Fee, any auction agent fees,
market agent fees, calculation agent fees, broker-dealer fees, if any, fees
paid to the Delaware Trustee, the Trustee and the Eligible Lender Trustee,
all allocated as of the close of business on the last day of the preceding
month;
(i) the amount of principal and interest received during the preceding
month relating to Financed Student Loans;
(j) the amount of the payment attributable to amounts in the Reserve
Fund, the amount of any other withdrawals from the Reserve Fund and the
balance of the Reserve Fund as of the close of business on the last day of
the preceding month;
(k) the portion, if any, of the payments attributable to amounts on
deposit in the Acquisition Fund;
(l) the aggregate amount, if any, paid by the Trustee to acquire
Student Loans from amounts on deposit in the Acquisition Fund during the
preceding month;
(m) the amount remaining in the Acquisition Fund that has not been
used to acquire Student Loans and is being transferred to the Debt Service
Fund;
(n) the aggregate amount, if any, paid for Financed Student Loans
purchased from the Trust during the preceding month;
(o) the number and principal amount of Financed Student Loans, as of
the close of business on the last day of the preceding month, that are (i)
0 to 30 days delinquent, (ii) 31 to 60 days delinquent, (iii) 61 to 90 days
delinquent, (iv) 91 to 120 days delinquent, (v) greater than 120 days
delinquent and (vi) for which claims have been filed with the appropriate
Guarantee Agency and which are awaiting payment;
(p) the Value of the Trust Estate and the Outstanding principal amount
of the Notes as of the close of business on the last day of the preceding
month; and
(q) the number and percentage by dollar amount of (i) rejected federal
reimbursement claims for Financed Student Loans, (ii) Financed Student
Loans in forbearance, and (iii) Financed Student Loans in deferment.
Each amount set forth pursuant to paragraph (b) and (c) above shall be
expressed as a dollar amount per authorized denomination of a Note. A copy of
the statements referred to above may be obtained by any Noteholder by a written
request to the Trustee, addressed to its Principal Office.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, as of the day and year first above written.
COLLEGE LOAN CORPORATION TRUST I
By Wilmington Trust Company, not in its
individual capacity but solely as Delaware
Trustee
By__________________________________
Name________________________________
Title__________________________________
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Eligible
Lender Trustee
By__________________________________
Name________________________________
Title_________________________________
DEUTSCHE BANK TRUST COMPANY AMERICAS, as Trustee
By__________________________________
Name________________________________
Title_________________________________
EXHIBIT A
ELIGIBLE LOAN ACQUISITION CERTIFICATE
ADDRESSED TO TRUSTEE
This Eligible Loan Acquisition Certificate is submitted pursuant to the
provisions of Section 4.02 of the Amended and Restated Indenture of Trust, dated
as of ________ __, 2003 (as amended and supplemented from time to time in
accordance with its terms, the "Indenture"), from College Loan Corporation Trust
I (the "Issuer") and Deutsche Bank Trust Company Americas, as eligible lender
trustee, to Deutsche Bank Trust Company Americas, as indenture trustee. All
capitalized terms used in this Certificate and not otherwise defined herein
shall have the respective meanings given to such terms in the Indenture. In your
capacity as Trustee, you are hereby authorized and requested to disburse (i) to
the Lender(s) identified in the schedule attached hereto (the "Student Loan
Acquisition Schedule") the amount(s) specified in such Schedule from the
Acquisition Fund (or, in the case of an exchange pursuant to Section 4.02 of the
Indenture, the Student Loans listed in Annex 1 hereto) for the acquisition of
Eligible Loans, and any related Add-On Loan; and (ii) to the Lender(s), the
amount of Premium set forth in such Schedule. With respect to the Eligible Loans
so to be acquired, the Issuer hereby certifies as follows:
(a) The Eligible Loans to be acquired are those specified in the
Student Loan Acquisition Schedule (the "Acquired Eligible Loans").
(b) The amount to be disbursed pursuant to this Certificate does not
exceed the amount permitted under the provisions of Section 4.02 of the
Indenture.
(c) Each Acquired Eligible Loan is an Eligible Loan authorized so to
be acquired by the Indenture.
(d) You have been previously, or are herewith, provided with the
following items:
(i) with respect to each Acquired Eligible Loans, a copy of the
Guarantee Agreement relating thereto; and
(ii) instruments duly assigning the Acquired Eligible Loans to
the Issuer or the Eligible Lender Trustee.
(e) The Issuer is not, on the date hereof, in default under the
Indenture or any other agreement relating to the Acquired Eligible Loans.
The Issuer is not aware of any default existing on the date hereof under
any of the other documents referred to in paragraph (d) hereof.
(f) All of the conditions specified in the Indenture for the
acquisition of the Acquired Eligible Loans and the disbursement hereby
authorized and requested have been satisfied.
(g) The undersigned is authorized to sign and submit this Certificate
on behalf of the Issuer.
Witness my hand this ____ day of _____________, ______.
COLLEGE LOAN CORPORATION TRUST I
By Issuer Administrator
By__________________________________
Name_________________________________
Title__________________________________
EXHIBIT B
ACQUISITION ACCOUNT DEPOSIT CERTIFICATE
This Acquisition Account Deposit Certificate is submitted pursuant to the
provisions of Section 4.02 of the Amended and Restated Indenture of Trust, dated
as of ______ __, 2003 (as amended and supplemented from time to time in
accordance with its terms, the "Indenture"), from College Loan Corporation Trust
I (the "Issuer") and Deutsche Bank Trust Company Americas, as eligible lender
trustee, to Deutsche Bank Trust Company Americas, as indenture trustee (the
"Trustee"). All capitalized terms used in this Certificate and not otherwise
defined herein shall have the respective meanings given to such terms in the
Indenture. In your capacity as Trustee, you are hereby authorized and requested
to transfer $___________ of moneys in the Acquisition Fund to the Account of the
Acquisition Fund established pursuant to the Custodial Account Agreement, dated
as of __________ 1, ____, among the Issuer, the Trustee, College Loan
Corporation and _____________________ (the "Servicer"). Upon receipt of an
Origination Loan Certificate (as defined in the Indenture), in your capacity as
Trustee, you are authorized to College Loan Corporation, or its agent (which may
be the Servicer), for the acquisition of one or more of the Eligible Loans
identified in the schedule attached hereto (the "Student Loan Acquisition
Schedule") the amount(s) specified in such Student Loan Acquisition Schedule
from the Account of the Acquisition Fund established pursuant to the Acquisition
Account Agreement for the acquisition of Eligible Loans identified in such
Origination Loan Certificate. With respect to the Eligible Loans so to be
acquired, the Issuer hereby certifies as follows:
(a) The Eligible Loans to be acquired are one or more of those
specified in the Student Loan Acquisition Schedule (the "Acquired Eligible
Loans").
(b) The amounts to be disbursed pursuant to this Certificate do not
exceed the amounts permitted under the provisions of Section 4.02 of the
Indenture.
(c) Each Acquired Eligible Loan is an Eligible Loan authorized so to
be acquired by the Indenture.
(d) You have been previously, or are herewith, provided with the
following item:
(i) a copy of the Guarantee Agreement relating thereto.
(e) Pursuant to the Origination Loan Certificate, you will be provided
with instruments duly assigning the Acquired Eligible Loans to the Issuer
or the Eligible Lender Trustee and evidence that all documentation relating
to the Eligible Loan has been delivered to the Servicer.
(f) The Issuer is not, on the date hereof, in default under the
Indenture or any other agreement relating to the Acquired Eligible Loans.
The Issuer is not aware of any default existing on the date hereof under
any of the other documents referred to in paragraph (d) hereof.
(g) All of the conditions specified in the resolution relating to the
Acquired Eligible Loans and the Indenture for the acquisition of the
Acquired Eligible Loans and the disbursement hereby authorized and
requested have been satisfied.
(h) The undersigned is authorized to sign and submit this Certificate
on behalf of the Issuer.
Witness my hand this ____ day of _____________, ______.
COLLEGE LOAN CORPORATION TRUST I
By Issuer Administrator
By__________________________________
Name________________________________
Title__________________________________
EXHIBIT C
ORIGINATION LOAN CERTIFICATE
This Origination Loan Certificate is submitted pursuant to the provisions
of Section 4.02 of the Amended and Restated Indenture of Trust, dated as of
______ __, 2003 (as amended and supplemented from time to time in accordance
with its terms, the "Indenture"), from College Loan Corporation Trust I (the
"Issuer") and Deutsche Bank Trust Company Americas, as eligible lender trustee,
to Deutsche Bank Trust Company Americas, as indenture trustee (the "Trustee").
All capitalized terms used in this Certificate and not otherwise defined herein
shall have the respective meanings given to such terms in the Indenture.
Pursuant to the Section 4.02 of the Indenture, the Account Acquisition Deposit
Certificate, dated __________ __, ___ (the "Origination Certificate"), and the
terms and provisions of the Acquisition Account Agreement, dated as of
___________ 1, ____ (the "Acquisition Agreement"), among the Issuer, the
Trustee, College Loan Corporation and _____________________ (the "Servicer"), in
your capacity as Trustee, you are hereby requested to disburse to the College
Loan Corporation, or its designee, an amount equal to $__________, representing
the purchase price of the Eligible Loans identified in the schedule attached
hereto (the "Supplemental Schedule"), which Eligible Loans have been authorized
to be acquired pursuant to the Student Loan Acquisition Schedule attached to the
Account Acquisition Deposit Certificate. With respect to the Eligible Loans so
to be acquired, the Issuer, or its agent, hereby certifies as follows:
(a) The Eligible Loans to be acquired are those specified in the
Supplemental Schedule (the "Acquired Eligible Loans").
(b) The Acquired Eligible Loans have been authorized to be acquired by
the Issuer pursuant to the Origination Certificate.
(c) The amount disbursed pursuant to this Certificate does not exceed
the amount permitted under the provisions of the Acquisition Agreement.
(d) You have been previously, or are herewith, provided with
instruments duly assigning the Acquired Eligible Loans to the Issuer or the
Eligible Lender Trustee and all documentation relating to the Eligible Loan
has been delivered to the Servicer.
(e) The undersigned is authorized to sign and submit this Certificate
on behalf of the Sponsor.
Witness my hand this ____ day of _____________, ______.
COLLEGE LOAN CORPORATION TRUST I
By Issuer Administrator
By__________________________________
Name________________________________
Title__________________________________
EXHIBIT D
EXHIBIT D TO INDENTURE
ORIGINATION LOAN CERTIFICATE
This Origination Loan Certificate is submitted pursuant to the provisions
of Section 4.02 of the Amended and Restated Indenture of Trust, dated as of
_______ __, 2003 (as amended and supplemented from time to time in accordance
with its terms, the "Indenture"), from College Loan Corporation Trust I (the
"Issuer") and Deutsche Bank Trust Company Americas (formerly Deutsche Bank Trust
Company Americas), as eligible lender trustee, to Deutsche Bank Trust Company
Americas (formerly Deutsche Bank Trust Company Americas), as indenture trustee
(the "Trustee"). All capitalized terms used in this Certificate and not
otherwise defined herein shall have the respective meanings given to such terms
in the Indenture.
Pursuant to Section 4.02 of the Indenture, in your capacity as Trustee, you
are hereby requested to disburse to __________________, which is a Servicer or
other disbursing agent (the "Disbursement Transferee") for the Issuer, an amount
equal to $__________, representing the principal amount of Eligible Loans
identified in the schedule attached hereto (the "Supplemental Schedule"), which
Eligible Loans have been authorized by Issuer to be originated with funds on
deposit in the Acquisition Fund pursuant to this Origination Loan Certificate.
Such amount shall be transferred to the Disbursement Transferee by transferring
such amount to the following account:_____________________, which account the
Issuer hereby certifies is a control account, within the meaning of the Uniform
Commercial Code, in favor of the Trustee. With respect to the Eligible Loans so
to be originated, the Issuer, or its agent, hereby certifies as follows:
(a) The Eligible Loans to be originated are those specified in the
Supplemental Schedule (the "Originated Eligible Loans").
(b) The Originated Eligible Loans have been authorized to be originated by
the Issuer.
(c) The amount disbursed pursuant to this Certificate does not exceed the
amount necessary to originate an equal amount of Eligible Loans.
(d) The undersigned is authorized to sign and submit this Certificate on
behalf of the Issuer.
Witness my hand this ____ day of _____________, ______.
COLLEGE LOAN CORPORATION TRUST I
By Issuer Administrator
By__________________________________
Name________________________________
Title__________________________________