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Exhibit 99.1
ADMINISTRATION AGREEMENT dated as of March 27, 1997, among PNC STUDENT LOAN
TRUST I, a Delaware business trust (the "Issuer"), PNC BANK, NATIONAL
ASSOCIATION, a national banking association, as administrator (the
"Administrator"), and BANKERS TRUST COMPANY, a New York banking corporation, not
in its individual capacity but solely as Trustee (the "Indenture Trustee").
W I T N E S S E T H
WHEREAS the Issuer was created pursuant to a Trust Agreement
dated as of March 27, 1997 (the "Trust Agreement") among the Administrator, as
depositor, The First National Bank of Chicago, as Eligible Lender Trustee and
First Chicago Delaware Inc., as Delaware Trustee;
WHEREAS the Issuer may issue from time to time, in one or
more Classes, Asset Backed Certificates (the "Certificates") pursuant to the
Trust Agreement and, if applicable, a related Trust Supplement;
WHEREAS the Issuer may issue from time to time, in one or
more Series and one or more Classes, Asset Backed Notes (the "Notes") pursuant
to the Indenture dated as of March 27, 1997 (the "Indenture"), between the
Issuer and the Indenture Trustee and a related Terms Supplement (capitalized
terms used herein and not defined herein shall have the meanings assigned to
such terms in Appendix A to the Indenture, which also contains rules of usage
and construction that shall be applicable herein);
WHEREAS the Issuer has entered into or will enter into
certain agreements in connection with the issuance of the Notes and the
Certificates, including the Transfer and Servicing Agreement, the Guarantee
Agreements, the Purchase Agreement and related Terms Agreement and the
Indenture and related Terms Supplements (all such agreements being collectively
referred to herein as the "Related Agreements");
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WHEREAS, pursuant to the Basic Documents Issuer and the
Eligible Lender Trustee are required to perform certain duties in connection
with (a) the Notes and the Trust Estate therefor pledged to the Indenture
Trustee pursuant to the Indenture and related Terms Supplements and (b) the
Certificates (the registered holders of the Certificates being referred to
herein as the "Owners");
WHEREAS the Issuer and the Eligible Lender Trustee desire to
have the Administrator perform certain of the duties of the Issuer and the
Eligible Lender Trustee referred to in the preceding clause, and to provide
such additional services consistent with the terms of this Agreement and the
Related Agreements as the Issuer and the Eligible Lender Trustee may from time
to time request;
WHEREAS the Administrator has the capacity to provide or
cause to be provided the services required hereby and is willing to perform or
cause to be performed such services for the Issuer and the Eligible Lender
Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, the parties, intending to be legally
bound hereby, agree as follows:
1. DUTIES OF THE ADMINISTRATOR. (a) DUTIES WITH RESPECT TO
THE INDENTURE AND TRUST AGREEMENT. The Administrator shall perform all its
duties as Administrator under the Trust Agreement and the Transfer and
Servicing Agreement. In addition, the Administrator shall consult with the
Eligible Lender Trustee as the Administrator deems appropriate regarding the
duties of the Issuer under the Indenture, each related Terms Supplement and the
Trust Agreement. The Administrator shall monitor the performance of the Issuer
and shall advise the Eligible Lender Trustee when action by the Issuer or the
Eligible Lender Trustee is necessary to comply with the Issuer's or the
Eligible Lender Trustee's duties under the Indenture, each related Terms
Supplement, the Trust Agreement and any of the other Basic Documents. The
Administrator shall prepare for
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execution, if required, by the Issuer or shall cause the preparation by other
appropriate Persons of all such documents, reports, filings, instruments,
certificates and opinions as it shall be the duty of the Issuer to prepare,
file or deliver pursuant to the Indenture, each related Terms Supplement, the
Trust Agreement or any of the other Basic Documents. In furtherance of the
foregoing, the Administrator shall take all appropriate action that is the duty
of the Administrator and of the Issuer to take pursuant to the Trust Agreement,
the Indenture and each related Terms Supplement, including such of the
foregoing as are required of the Issuer with respect to the following matters
(references are to sections of the Indenture):
(A) the duty to cause the Note Registrar to keep the Note
Register and to give the Indenture Trustee notice of any appointment
of a new Note Registrar and the location, or change in location, of
the Note Registrar (Section 2.6);
(B) the fixing or causing to be fixed of any specified record
date and the notification of the Indenture Trustee and Noteholders
with respect to special payment dates, if any (Section 2.9(d));
(C) the preparation of or obtaining of the documents and
instruments required for authentication of the Notes and delivery of
the same to the Indenture Trustee (Section 2.11);
(D) the preparation, obtaining or filing of the instruments,
opinions and certificates and other documents required for the release
of collateral (Section 2.12);
(E) the duty to cause the Note Registrar to maintain on
behalf of the Issuer an office in the Borough of Manhattan, City of
New York, for registration of transfer or exchange of Notes (Section
3.2);
(F) the duty to cause newly appointed Paying Agents, if any,
to deliver to the Indenture Trustee the instrument specified in the
Indenture regarding funds held in trust (Section 3.3);
(G) the direction to the Paying Agents to deposit moneys with
the Indenture Trustee (Section 3.3);
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(H) the obtaining and preservation of the Issuer's
qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of the Indenture, the Notes and each other instrument
and agreement included in the Indenture Trust Estate (Section 3.4);
(I) the preparation of all supplements, amendments, financing
statements, continuation statements, instruments of further assurance
and other instruments, in accordance with Section 3.5 of the
Indenture, necessary to protect the Indenture Trust Estate (Section
3.5);
(J) the identification to the Indenture Trustee in an
Officer's Certificate of the Issuer of a Person with whom the Issuer
has contracted to perform its duties under the Indenture (Section
3.7(b));
(K) the notification of the Indenture Trustee and the Rating
Agencies (if any Notes or Certificates are then rated by the Rating
Agencies) of a Master Servicer Default known to the Administrator
pursuant to the Transfer and Servicing Agreement and, if such Master
Servicer Default arises from the failure of the Master Servicer to
perform any of its duties under the Transfer and Servicing Agreement,
the taking of all reasonable steps available to enforce the Issuer's
rights under the Basic Documents in respect of such failure (Section
3.7(d));
(L) the preparation and obtaining of documents and
instruments required for the release of the Issuer from its
obligations under the Indenture (Section 3.10);
(M) the delivery of notice to the Indenture Trustee and the
Rating Agencies (if any Notes or Certificates are then rated by the
Rating Agencies) of each Event of Default, any Default under Section
5.1(iii) of the Indenture and each default by the Master Servicer, the
Administrator or the Seller under the Transfer and Servicing Agreement
or any Supplemental Transfer and Servicing Agreement known to the
Administrator (Section 3.18);
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(N) the monitoring of the Issuer's obligations as to the
satisfaction and discharge of the Indenture and the preparation of an
Officers' Certificate of the Issuer and the obtaining of the Opinion
of Counsel and the Independent Certificate relating thereto (Section
4.1);
(O) the compliance with any written directive of the
Indenture Trustee to compel performance by the Master Servicer under
the Transfer and Servicing Agreement (Section 5.16);
(P) the reimbursement to the Indenture Trustee of all
reasonable out-of-pocket expenses incurred or made by it in accordance
with any provision of the Indenture as well as the indemnification, to
the extent provided in the Indenture, of the Indenture Trustee in
connection with the administration of the Trust and the performance of
the Indenture Trustee's duties under the Indenture and the other Basic
Documents (Section 6.7);
(Q) the removal of the Indenture Trustee and appointment of a
successor Indenture Trustee (Section 6.8);
(R) the preparation of any written instruments required to
confirm more fully the authority of any co-trustee or separate trustee
and any written instruments necessary in connection with the
resignation or removal of any co-trustee or separate trustee (Section
6.10);
(S) the furnishing of the Indenture Trustee with the names
and addresses of Noteholders during any period when the Indenture
Trustee is not the Note Registrar (Section 7.1);
(T) the preparation and, after execution by the Issuer, the
filing with the Commission, any applicable State agencies and the
Indenture Trustee of documents required to be filed on a periodic
basis with, and summaries thereof as may be required by rules and
regulations prescribed by, the Commission and any applicable State
agencies and the transmission of such summaries, as necessary, to the
Noteholders (Section 7.3);
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(U) the opening of one or more accounts in the Issuer's, the
Indenture Trustee's or the Eligible Lender Trustee's name, the
preparation of Issuer Orders, Officers' Certificates of the Issuer and
Opinions of Counsel and all other actions reasonably necessary with
respect to investment and reinvestment of funds in the Trust Accounts
(Sections 8.2 and 8.3);
(V) the preparation of Issuer Orders and the obtaining of
Opinions of Counsel with respect to the execution of supplemental
indentures and the mailing to the Noteholders of notices with respect
to such supplemental indentures (Sections 9.1, 9.2 and 9.3);
(W) the preparation of or obtaining of the documents and
instruments required for the execution and authentication of new Notes
conforming to any supplemental indenture and the delivery of the same
to the Eligible Lender Trustee and the Indenture Trustee, respectively
(Section 9.6);
(X) the preparation of all Officers' Certificates of the
Issuer, or obtaining Opinions of Counsel and Independent Certificates
with respect to any requests by the Issuer to the Indenture Trustee to
take any action under the Indenture (Section 11.1(a));
(Y) the preparation and delivery of Officers' Certificates of
the Issuer and the obtaining of Independent Certificates, if
necessary, for the release of property from the lien of the Indenture
(Section 11.1(b));
(AA) the preparation and delivery to Noteholders and the
Indenture Trustee of any agreements with respect to alternate payment
and notice provisions (Section 11.6); and
(BB) the recording of the Indenture, if applicable (Section
11.15).
(b) DUTIES WITH RESPECT TO THE ISSUER. (i) In addition to the
duties of the Administrator set forth above and
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those provided in the other Related Agreements and the Trust Agreement which
the Administrator agrees herein to perform, the Administrator shall perform
such calculations and shall prepare for execution by the Issuer or the Eligible
Lender Trustee or shall cause the preparation by other appropriate Persons of
all such documents, reports, filings, instruments, certificates and opinions as
it shall be the duty of the Issuer or the Eligible Lender Trustee to prepare,
file or deliver pursuant to the Related Agreements, the Trust Agreement or any
of the other Basic Documents, and at the request of the Eligible Lender Trustee
shall take all appropriate action that it is the duty of the Issuer to take
pursuant to the Related Agreements, the Trust Agreement or any of the other
Basic Documents. Subject to Section 5 of this Agreement, and in accordance with
the directions of the Eligible Lender Trustee, the Administrator shall
administer, perform or supervise the performance of such other activities in
connection with the Trust Estate (including the Related Agreements and other
Basic Documents) as are not covered by any of the foregoing provisions and as
are expressly requested by the Eligible Lender Trustee and are reasonably
within the capability of the Administrator.
(ii) In carrying out the foregoing duties or any of its other
obligations under this Agreement, the Administrator may enter into transactions
with or otherwise deal with any of its Affiliates; provided, however, that the
terms of any such transactions or dealings shall be in accordance with any
directions received from the Issuer and shall be, in the Administrator's
opinion, no less favorable to the Issuer than would be available from
unaffiliated parties.
(c) NON-MINISTERIAL MATTERS. With respect to matters that in
the reasonable judgment of the Administrator are non-ministerial, the
Administrator shall not take any action unless within a reasonable time before
the taking of such action, the Administrator shall have notified the Eligible
Lender Trustee of the proposed action and the Eligible Lender Trustee shall not
have withheld consent or provided an alternative direction. For the purpose of
the preceding sentence, "non-ministerial matters" shall include:
(A) the amendment of or any supplement to the Indenture or
any Terms Supplement;
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(B) the initiation of any claim or lawsuit by the Issuer and
the compromise of any action, claim or lawsuit brought by or against
the Issuer (other than in connection with the collection of the
Financed Student Loans);
(C) the amendment, change or modification of the Related
Agreements or the Trust Agreement;
(D) the appointment of successor Note Registrars, successor
Certificate Paying Agents and successor Indenture Trustees pursuant to
the Indenture or to the appointment of successor Administrators or
successor Master Servicers, or the consent to the assignment by the
Note Registrar, Certificate Paying Agent or Indenture Trustee of its
obligations under the Indenture;
(E) the removal of the Indenture Trustee; and
(F) the buying or selling of assets in the Trust Estate,
including student loans.
(d) EXCEPTIONS. Notwithstanding anything to the contrary in
this Agreement, except as expressly provided herein or in the other Basic
Documents, the Administrator shall not be obligated to, and shall not, (1) make
any payments to the Noteholders under the Related Agreements, (2) make any
payments to Certificateholders under the Trust Agreement or the Transfer and
Servicing Agreement, (3) sell the Trust Estate pursuant to Section 5.4 of the
Indenture, (4) take any other action that the Issuer directs the Administrator
not to take on its behalf, (5) in connection with its duties hereunder assume
any indemnification obligation of any other Person or (6) service the Financed
Student Loans.
2. RECORDS. The Administrator shall maintain appropriate
books of account and records relating to services performed hereunder, which
books of account and records shall be reasonably accessible for inspection by
the Issuer at any time during normal business hours.
3. COMPENSATION. As compensation for the performance of the
Administrator's obligations under this Agreement and as
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reimbursement for its expenses related thereto, the Administrator shall be
entitled to a fee to be determined equal to a rate per annum of the outstanding
principal amount of the Notes, calculated monthly and payable on the first
Distribution Date occurring in each month (the "Administration Fee").
4. ADDITIONAL INFORMATION TO BE FURNISHED TO THE ISSUER. The
Administrator shall furnish the Issuer from time to time such additional
information regarding the Trust Estate as the Issuer shall reasonably request.
5. INDEPENDENCE OF THE ADMINISTRATOR. For all purposes of
this Agreement, the Administrator shall be an independent contractor and shall
not be subject to the supervision of the Issuer or the Eligible Lender Trustee
with respect to the manner in which it accomplishes the performance of its
obligations hereunder. Unless expressly authorized by the Issuer or provided in
the Basic Documents, the Administrator shall have no authority to act for or
represent the Issuer or the Eligible Lender Trustee in any way and shall not
otherwise be deemed an agent of the Issuer or the Eligible Lender Trustee.
6. NO JOINT VENTURE; NOT TRUSTEE. Nothing contained in this
Agreement (i) shall constitute the Administrator and any of the Issuer, the
Indenture Trustee or the Eligible Lender Trustee as members of any partnership,
joint venture, association, syndicate, unincorporated business or other
separate entity, (ii) shall be construed to impose any liability as such on any
of them or (iii) shall be deemed to confer on any of them any express, implied
or apparent authority to incur any obligation or liability on behalf of the
others. Further, nothing contained in this Agreement shall constitute or be
deemed to constitute the Administrator as a trustee or co-trustee of the Trust.
7. OTHER ACTIVITIES OF ADMINISTRATOR. Nothing herein shall
prevent the Administrator or its Affiliates from engaging in other businesses
or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Eligible
Lender Trustee or the Indenture Trustee.
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8. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF
ADMINISTRATOR. (a) This Agreement shall continue in force until the dissolution
of the Issuer, upon which event this Agreement shall automatically terminate.
(b) The provisions of Article VII and Article VIII of the
Transfer and Servicing Agreement relating to the resignation or removal of the
Administrator and the failure of the Administrator to perform its duties under
this Agreement are hereby incorporated by reference herein.
9. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL. Promptly
upon the effective date of termination of this Agreement pursuant to pursuant
to Section 8(a) or the resignation or removal of the Administrator pursuant to
Section 8(b) and the Transfer and Servicing Agreement, the Administrator shall
be entitled to be paid all fees and reimbursable expenses accruing to it to the
date of such termination, resignation or removal. The Administrator shall
forthwith upon such termination pursuant to Section 8(a) deliver to the Issuer
all property and documents of or relating to the Collateral then in the custody
of the Administrator. In the event of the resignation or removal of the
Administrator, the Administrator shall cooperate with the Issuer and take all
reasonable steps requested to assist the Issuer in making an orderly transfer
of the duties of the Administrator.
10. NOTICES. Any notice, report or other communication given
hereunder shall be in writing and addressed as follows:
(a) if to the Issuer or the Eligible Lender Trustee, to
The First National Bank of Chicago
Corporate Trust Xxxxxx
Xxx Xxxxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Corporate Trust Department
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(b) if to the Administrator, to
PNC Bank, National Association
0000 Xxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
with a copy to
PNC Bank, National Association
One PNC Plaza
000 Xxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxx, Esq.
(c) if to the Indenture Trustee, to
Bankers Trust Company
Four Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Corporate Trust and
Agency Group, Structured
Finance Team
or to such other address as any party shall have provided to the other parties
in writing. Any notice required to be in writing hereunder shall be deemed
given if such notice is mailed by certified mail, postage prepaid, or
hand-delivered to the address of such party as provided above.
11. AMENDMENTS. This Agreement may be amended from time to
time by a written amendment duly executed and delivered by the Issuer, the
Administrator and the Indenture Trustee, with the written consent of the
Eligible Lender Trustee and the Majority Noteholder for the purpose of adding
any provisions to or changing in any manner or eliminating any of the
provisions of this Agreement or of modifying in any manner the rights of the
Noteholders or Certificateholders; provided, however, that no such amendment
may (i) increase or reduce in any manner the amount of, or accelerate or delay
the timing of, collections of payments with respect to Financed Student Loans
or distributions that are required to be made for the benefit of the
Noteholders or Certificateholders or (ii) reduce the aforesaid percentage of
the Noteholders and the Certificateholders which are required to
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consent to any such amendment, without the consent of all Outstanding
Noteholders and Certificateholders. Prior to the execution of any such
amendment, or (iii) amend Section 2.3 of the Trust Agreement, the Administrator
shall furnish written notification or the substance of such amendment to each
of the Rating Agencies (if any Notes or Certificates are then rated by the
Rating Agencies) and the Majority Noteholder.
12. SUCCESSORS AND ASSIGNS. Notwithstanding anything to the
contrary contained herein, except as provided in Sections 6.5 and 6.8 of the
Transfer and Servicing Agreement, this Agreement may not be assigned by the
Administrator. Subject to the foregoing, this Agreement shall bind any
successors or assigns of the parties hereto.
13. GOVERNING LAW. This Agreement shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined in accordance with such laws.
14. HEADINGS. The section headings hereof have been inserted
for convenience of reference only and shall not be construed to affect the
meaning, construction or effect of this Agreement.
15. COUNTERPARTS. This Agreement may be executed in
counterparts, each of which when so executed shall together constitute but one
and the same agreement.
16. SEVERABILITY. Any provision of this Agreement that is
prohibited or unenforceable in any jurisdiction shall be ineffective to the
extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof and any such prohibition or unenforceability in any
jurisdiction shall not invalidate or render unenforceable such provision in any
other jurisdiction.
17. NOT APPLICABLE TO PNC BANK, NATIONAL ASSOCIATION IN OTHER
CAPACITIES. Nothing in this Agreement shall affect any obligation PNC Bank,
National Association may have in any other capacity under the Basic Documents.
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18. PROVISIONS OF TRANSFER AND SERVICING AGREEMENT CONTROL.
The provisions of the Transfer and Servicing Agreement and of each Supplemental
Transfer and Servicing Agreement relating to the Administrator and to this
Agreement shall in all events govern and are hereby incorporated herein and, to
the extent any provision herein shall be inconsistent with any such provision
of the Transfer and Servicing Agreement, the Transfer and Servicing Agreement
shall govern.
19. LIMITATION OF LIABILITY OF ELIGIBLE LENDER TRUSTEE AND
INDENTURE TRUSTEE. (a) Notwithstanding anything contained herein to the
contrary, this instrument has been countersigned by The First National Bank of
Chicago not in its individual capacity but solely in its capacity as Eligible
Lender Trustee of the Issuer and in no event shall Dauphin Deposit Bank and
Trust Company in its individual capacity or any Owner of the Issuer have any
liability for the representations, warranties, covenants, agreements or other
obligations of the Issuer hereunder, as to all of which recourse shall be had
solely to the assets of the Issuer. For all purposes of this Agreement, in the
performance of any duties or obligations of the Issuer thereunder, the Eligible
Lender Trustee shall be subject to, and entitled to the benefits of, the terms
and provisions of Articles VI, VII and VIII of the Trust Agreement.
(b) Notwithstanding anything contained herein to the
contrary, this Agreement has been countersigned by Bankers Trust Company not in
its individual capacity but solely as Indenture Trustee and in no event shall
Bankers Trust Company have any liability for the representations, warranties,
covenants, agreements or other obligations of the Issuer hereunder or in any of
the certificates, notices or agreements delivered pursuant hereto, as to all of
which recourse shall be had solely to the assets of the Issuer.
20. THIRD-PARTY BENEFICIARY. The Eligible Lender Trustee is a
third-party beneficiary to this Agreement and is entitled to the rights and
benefits hereunder and may enforce the provisions hereof as if it were a party
hereto.
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IN WITNESS WHEREOF, the parties hereto have caused this
Administration Agreement to be duly executed and delivered as of the day and
year first above written.
PNC BANK STUDENT LOAN TRUST I
by THE FIRST NATIONAL BANK
OF CHICAGO, not in its
individual capacity but
solely as Eligible Lender
Trustee,
By: /S/ XXXXXXX X. XXXXXX
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Name:
Title:
BANKERS TRUST COMPANY, not in
its individual capacity but
solely as Indenture Trustee,
By /S/ XXXXX XXXXXXX
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Name:
Title:
PNC BANK, NATIONAL ASSOCIATION, as
Administrator,
By /S/ XXXXX X. XXXXXX
------------------------------
Name:
Title:
