EXHIBIT 99.3
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SLM STUDENT LOAN TRUST 2003-5
ADMINISTRATION AGREEMENT SUPPLEMENT
DATED AS OF MAY 20, 2003
TO
MASTER ADMINISTRATION AGREEMENT
DATED AS OF MAY 1, 1997
BETWEEN
SLM FUNDING LLC
AND
STUDENT LOAN MARKETING ASSOCIATION
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SLM Student Loan Trust 2003-5 Administration Agreement Supplement dated as
of May 20, 2003 (the "Supplement") to the Master Administration Agreement dated
as of May 1, 1997 (the "Agreement") between SLM Funding LLC, as successor in
interest to SLM Funding Corporation (the "Depositor"), and Student Loan
Marketing Association (the "Administrator").
This Supplement is being delivered to the Administrator pursuant to and in
satisfaction of the conditions set forth in Section 1.2(a) of the Agreement with
respect to SLM Student Loan Trust 2003-5 (the "Trust"). The provisions of this
Supplement shall be applicable only to SLM Student Loan Trust 2003-5.
General. The Trust is issuing its Class A Notes, Class B Notes and an
Excess Distribution Certificate only. It will not issue Certificates.
Accordingly, all usages of "Certificates" and of terms referring thereto in the
Agreement shall be disregarded. In addition, with respect to the Trust only, all
references to the "Seller" in the Agreement shall be deleted and replaced with
the "Depositor", references to "SLM Funding Corporation, a Delaware corporation"
shall be deleted and replaced with "SLM Funding LLC, a Delaware limited
liability company, successor in interest to SLM Funding Corporation, a Delaware
corporation" and all references to the "Issuer" shall be deleted and replaced
with the "Trust".
1. The following entities are hereby designated in accordance with clause 1 of
Section 1.2(a) of the Agreement:
The Trust: SLM Student Loan Trust 2003-5
The Eligible Lender Trustee: Chase Manhattan Bank USA, National Association
The Interim Eligible Lender Trustee: Chase Manhattan Bank USA, National
Association
The Indenture Trustee: The Bank of New York; references to Bankers Trust
Company in the Agreement shall mean The Bank of New York for the purposes
of the Trust
The initial deposit into the Collection Account on the Closing Date, which
Xxxxxx Xxx shall make on behalf of the Trust in accordance with Section 2.6C of
the Agreement shall be: $0.00.
2. Attached hereto is Appendix A (SLM Student Loan Trust 2003-5) containing
those definitions that shall be applicable to the Agreement (including this
supplement) in connection with the Trust in place of the definitions contained
in Appendix A (Master) attached to the Agreement.
3. Each of the Basic Documents (other than the Agreement) has been executed and
delivered by each of the parties thereto, is being delivered to the
Administrator together with this Supplement and is in substantially the
respective forms attached to the Agreement as Exhibits B through I (to the
extent applicable).
4. 4. Notwithstanding anything to the contrary set forth in Section 2.3C.2 of
the Agreement, the Indenture Trustee shall have no liability or obligation in
respect of any failed Delivery, as
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contemplated therein, other than with respect to a Delivery which fails as a
result of any action or inaction on behalf of the Indenture Trustee.
5. The Agreement is hereby modified for purposes of SLM Student Loan Trust
2003-5 only as follows:
(a) Section 2.1 is amended by inserting the following:
s. engaging or terminating any Broker-Dealers and taking other actions or
all obligations required to be performed by the Administrator with
respect to the Auction Rate Note Procedures (Appendix A-2) attached
hereto, and
t. calculating prior to the fifth Business Day of each month, the Student
Loan Rate and notifying the Auction Agent, the Indenture Trustee and
the Broker-Dealers promptly following the calcuation date.
(b) Section 2.2B is deleted and replaced with the following:
B. The Administrator shall be responsible for performance of the duties
of the Eligible Lender Trustee set forth in Section 5.4 of the Trust Agreement
and the Administrator shall be entitled to hire an independent accounting firm
to perform the duties described therein, the reasonable fees and expenses of
which shall be paid by the Depositor.
(c) Section 2.2 is amended by inserting the following:
E. With respect to the Swap Agreement and the Interest Rate Cap
Agreement, the Administrator shall perform the notice obligations in the event
of a default by the Swap Counterparty or the Interest Rate Cap Swap
Counterparty.
(d) Section 2.3A is amended by inserting the following subsections:
3. On the Closing Date, the Administrator, for the benefit of the
Noteholders and the Trust, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Capitalized Interest
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Trust. The Capitalized
Interest Account will initially be established as a segregated trust
account in the name of the Indenture Trustee with the corporate trust
department of the Indenture Trustee.
4. On the Closing Date, the Administrator, for the benefit of the
Noteholders and the Trust, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Future Distribution
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Trust. The Future
Distribution Account will initially be established as a segregated trust
account in the name of the Indenture Trustee with the corporate trust
department of the Indenture Trustee.
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5. On the Closing Date, the Administrator, for the benefit of the
Noteholders and the Trust, shall establish and maintain in the name of the
Indenture Trustee an Eligible Deposit Account (the "Euro Account"), which
shall be an interest bearing account bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Trust. The Euro Account will initially be established as a segregated trust
account in the name of the Indenture Trustee with the corporate trust
department of the London Paying Agent.
(e) Section 2.3B is amended by including "Capitalized Interest Account,"
"Future Distribution Account" and "Euro Account" in the definition of
"Trust Accounts." Section 2.3B is further amended by deleting the third
sentence in its entirety and replacing it with the following: "Funds on
deposit in the Trust Accounts (other than the Euro Account) shall be
invested in Eligible Investments that mature so that such funds will be
available on the Monthly Servicing Payment Date (to the extent necessary to
pay the Primary Servicing Fee payable on such date) or the applicable
Distribution Date." Funds on deposit in the Euro Account shall not be
invested but shall bear interest at the prevailing available treasury rate.
(f) Section 2.4 is amended as follows:
(i) In the sentence immediately preceding the proviso the word
"Quarterly" is inserted immediately prior to "Distribution Date"; (ii)
the last part of the sentence immediately preceding the proviso is
changed from "a rate equal to the Federal Funds Rate less .20%" to "a
rate equal to no less than the Federal Funds Rate less .20%."; and
(iii) the following sentence is inserted at the end of the paragraph:
"The Administrator shall also deposit into the Collection Account (a) on or
before the fifteenth calendar day of each month, an amount sufficient to
make the allocations described under Section 2.7E and (b) on or before the
Business Day preceding each Distribution Date that is not a Quarterly
Distribution Date any amounts required to make distributions on such
Distribution Date not previously deposited pursuant to clause (a) above, in
each case, to the extent it has collected such amounts during the related
Collection Period."
(g) Section 2.4 is amended as follows: the last part of the sentence
immediately preceding the proviso is changed from "a rate equal to the
Federal Funds Rate less 0.20%" to "a rate equal to no less than the Federal
Funds Rate less 0.20%".
(h) Section 2.6B is amended by inserting the word "Quarterly" immediately
preceding "Distribution Date" in all instances and by changing the words
"the sum of the Servicing Fee" in the first proviso to "the Primary
Servicing Fee".
(i) Section 2.6 is amended by inserting the following subsection:
D. The Administrator shall cause all payments payable to the Issuer from
the Swap Counterparty to be deposited into the Euro Account. The Administrator
shall also cause all amounts payable to the Trust from the Interest Rate Cap
Swap Counterparty to be deposited into the Collection Account.
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(j) Section 2.7A is amended by inserting the following after the first
sentence:
On or before the Business Day immediately preceding each Distribution Date
that is not a Quarterly Distribution Date, the Administrator shall
calculate (i) all amounts required (a) to be deposited in the Collection
Account from the Reserve Account and the Capitalized Interest Account and
(b) Investment Earnings to be transferred from the Trust Accounts to the
Collection Account and (ii) the amount to be distributed therefrom on the
related Distribution Date.
On or before the Business Day immediately preceding each Distribution Date,
the Administrator shall calculate any amounts to be deposited in the Future
Distribution Account from the Collection Account on the related
Distribution Date with respect to each applicable entity and the amount to
be withdrawn from the Future Distribution Account with respect to each
applicable entity.
(k) Section 2.7B is deleted and replaced with the following:
The Administrator shall instruct the Indenture Trustee in writing no later
than the second Business Day preceding each Monthly Servicing Payment Date
that is not a Quarterly Distribution Date (based on the information
contained in the Administrator's Certificate and the related Servicer's
Report delivered pursuant to Section 3.1 (A) and (B)) to distribute to the
Servicer, by 1.00 p.m. (New York time) on such Monthly Servicing Payment
Date, from and to the extent of funds on deposit in the Future Distribution
Account (with respect to funds allocated to the Servicer) and, if amounts
on deposit therein are insufficient, from Available Funds on deposit in the
Collection Account, the Primary Servicing Fee due with respect to the
preceding calendar month, and the Indenture Trustee shall comply with such
instructions.
(l) Section 2.7C through 2.7G is deleted and replaced with the following:
C. The Administrator shall instruct the Indenture Trustee in writing no
later than one Business Day preceding each Quarterly Distribution Date (based on
the information contained in the Administrator's Certificate and the related
Servicer's Report delivered pursuant to Section 3.1A and 3.1C) to make the
following deposits and distributions with respect to Notes that have a
Distribution Date on the Quarterly Distribution Date, and in the case of a
Quarterly Distribution Date that is not an Auction Rate Distribution Date for
all of the Auction Rate Notes, allocations to the Future Distribution Account
with respect to these Auction Rate Notes (for principal and Carry-over Amounts),
to the Persons or to the account specified below by 1:00 p.m. (New York time) on
such Quarterly Distribution Date (to the extent that funds are not required to
be distributed pursuant to Section 5.4(b) of the Indenture), to the extent of
the amount of Available Funds in the Collection Account plus amounts transferred
from the Reserve Account pursuant to Section 2.8.1, and through the September
2004 Distribution Date, amounts transferred from the Capitalized Interest
Account pursuant to Section 2.8.2 with respect to clauses 4(a), 4(c) and 5
below, and, as applicable, amounts on deposit in the Future Distribution
Account, in the following order of priority, and the Indenture Trustee shall
comply with such instructions:
1. to the Servicer, the Primary Servicing Fee due on such Distribution
Date;
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2. to the Administrator, the Administration Fee due on such Distribution
Date and all unpaid Administration Fees from prior Collection Periods;
3. pro rata, to the Auction Agent, any Auction Agent Fees and to the
Broker-Dealers, any Broker-Dealer Fees;
4. pro rata, based on the aggregate principal balance (and, if the Swap
Agreement is not in effect, the then current U.S. Dollar equivalent of
the aggregate principal balance of the Class A-5 Notes) of the Notes
(other than the Class A-5 Notes so long as the Swap Agreement is in
effect) and the amount of any Swap Termination Payments and Swap
Payments due and payable by the Trust to the Swap Counterparty under
this clause (4):
(a) to the Class A Noteholders (other than the Class A-5 Noteholders
so long as the Swap Agreement is in effect), the Class A
Noteholders' Interest Distribution Amount, pro rata, based on the
amounts payable as Class A Noteholders' Interest Distribution
Amount;
(b) to the Swap Counterparty, the amount of any Swap Termination
Payment due to the Swap Counterparty due to a Termination Event
(as defined in the Swap Agreement) resulting from a payment
default by the Trust or the bankruptcy or insolvency of the
Trust; provided, that if any amounts allocable to the Class A
Notes are not needed to pay the Class A Noteholders' Interest
Distribution Amount as of such Distribution Date, such amounts
will be applied to pay the portion, if any, of any Swap
Termination Payment referred to above remaining unpaid; and
(c) to the Swap Counterparty, Swap Interest Payments payable to the
Swap Counterparty by the Trust;
5. to the Class B Noteholders, the Class B Noteholders' Interest
Distribution Amount, pro rata, based on the amounts payable as Class B
Noteholders' Interest Distribution Amount;
6. to the Class A-1 Noteholders until paid in full, the Class A
Noteholders' Principal Distribution Amount;
7. on each Distribution Date after the Class A-1 Notes have been paid in
full, to the Class A-2 Noteholders until paid in full, any remaining
Class A Noteholders' Principal Distribution Amount;
8. on each Distribution Date after the Class A-2 Notes have been paid in
full, to the Class A-3 Noteholders until paid in full, any remaining
Class A Noteholders' Principal Distribution Amount;
9. on each Distribution Date after the Class A-3 Notes have been paid in
full, to the Class A-4 Noteholders until paid in full, any remaining
Class A Noteholders' Principal Distribution Amount;
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10. on each Distribution Date after the Class A-4 Notes have been paid in
full, (a) while the Swap Agreement is in effect, to the Swap
Counterparty, any remaining Class A Noteholders' Principal
Distribution Amount until Swap Principal Payments in an amount equal
to the U.S. Dollar equivalent of the initial principal balance of the
Class A-5 Notes (at the Initial Dollar/Euro Conversion Rate) have been
made to the Swap Counterparty and (b) if the Swap Agreement is not in
effect, to the Class A-5 Notes until paid in full, the Class A
Noteholders' Principal Distribution Amount;
11. on each Distribution Date after Swap Principal Payments in an amount
equal to the U.S. Dollar equivalent of the initial principal balance
of the Class A-5 Notes (at the Initial Dollar/Euro Conversion Rate)
have been made to the Swap Counterparty, to the Class A-6 Notes, the
Class A-7 Notes, the Class A-8 Notes and the Class A-9 Notes until
paid in full, pro rata, by lots of $50,000, any remaining Class A
Noteholders' Principal Distribution Amount, subject to the terms of
clause G below;
12. on each Distribution Date after all of the Class A Notes have been
paid in full and Swap Principal Payments in an amount equal to the
U.S. Dollar equivalent of the initial principal balance of the Class
A-5 Notes (at the Initial Dollar/Euro Conversion Rate) have been made
to the Swap Counterparty, to the Class B Noteholders until paid in
full, by lots of $50,000, the Class B Noteholders' Principal
Distribution Amount, subject to the terms of clause G below;
13. to the Reserve Account, the amount, if any, necessary to reinstate the
balance of the Reserve Account to the Specified Reserve Account
Balance;
14. to the Servicer, the aggregate unpaid amount of the Carryover
Servicing Fee, if any;
15. to the Class A Auction Rate Noteholders, pro rata, any Carry-over
Amounts due the Class A Notes;
16. to the Class B Noteholders, any Carry-over Amounts due the Class B
Notes;
17. sequentially, first, to the Swap Counterparty, the amount of any Swap
Termination Payments due to the Swap Counterparty by the Trust and not
payable in clause 4(b) above; and second, to the Interest Rate Cap
Swap Counterparty the amount of any termination payments due to the
Interest Rate Cap Swap Counterparty by the Trust in the event of a
termination of the Interest Rate Cap Agreement; and
18. to the Excess Distribution Certificate holder, any remaining amounts
after application of the preceding clauses.
Notwithstanding anything to the contrary herein, amounts that would be paid
to the Swap Counterparty pursuant to clause 4, 10 or 17 above will be determined
on or before the fourth Business Day preceding each Quarterly Distribution Date
and will be paid by the Trust to the
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Swap Counterparty on the third Business Day preceding each Quarterly
Distribution Date to the same extent and with the same priority as if they were
made on the applicable Quarterly Distribution Date.
On each Quarterly Distribution Date that is not an Auction Rate
Distribution Date for one or more classes of Auction Rate Notes, in lieu of
making payments on that date of principal and Carry-over Amounts to those
classes of Auction Rate Notes that do not have a Distribution Date on such
Quarterly Distribution Date, the Administrator shall cause those amounts to be
deposited into the Future Distribution Account.
In the event that a Swap Termination Payment is owed by the Trust to the
Swap Counterparty and a Replacement Transaction (as defined in the Swap
Agreement) is procured by the Trust under which the replacement Swap
Counterparty makes a payment to the Trust, the Administrator shall instruct the
Indenture Trustee to pay that amount directly to the original Swap Counterparty
to the extent that a payment is owed by the Trust to the Swap Counterparty. If
after making that payment, the original Swap Counterparty is still owed a
payment, then the remaining amount will be paid as set forth in clause 17 above.
Notwithstanding the foregoing, (x) if (a) on any Quarterly Distribution
Date following distributions under clauses 1 through 11 above to be made on such
Quarterly Distribution Date, without giving effect to payments from the
Capitalized Interest Account to the Class B Notes, the Outstanding Amount of the
Class A Notes would be in excess of (i) the outstanding principal balance of the
Trust Student Loans plus (ii) any accrued but unpaid interest on the Trust
Student Loans as of the last day of the related Collection Period plus (iii) the
balance of the Reserve Account on such Distribution Date following such
distributions minus (iv) the Specified Reserve Account Balance for that
Quarterly Distribution Date, or (b) an Event of Default affecting the Class A
Notes has occurred and is continuing, then, until the conditions described in
(a) or (b) no longer exist, amounts on deposit in the Collection Account and the
Reserve Account shall be applied on such Distribution Date to the payment of the
Class A Noteholders' Distribution Amount before any amounts are applied to the
payment of the Class B Noteholders' Distribution Amount; and (y) in the event
the Trust Student Loans are not sold pursuant to Section 6.1A, to pay as an
accelerated payment of principal balance of the Notes, first to the Class A
Noteholders in the same order and priority as is set forth in Sections 2.7C.6
through C.11 until the principal amount of the Class A Notes is paid in full and
reduced to zero, provided that the amount of such distribution shall not exceed
the outstanding principal balance of the Class A Notes or the Class B Notes, as
applicable, after giving effect to all other payments in respect of principal of
Class A Notes and Class B Notes to be made on such date.
D. If the Swap Agreement is not in effect, the Administrator shall
instruct the applicable Paying Agent in writing no later than the Business Day
preceding each Quarterly Distribution Date to distribute all amounts on deposit
in the Euro Account to the Class A-5 Noteholders on that Quarterly Distribution
Date. The Administrator shall cause U.S. Dollars to be converted into Euros in
amounts sufficient to make the distributions specified in this Agreement and the
Indenture. If the Swap Agreement is in effect, the Administrator shall instruct
the applicable Paying Agent in writing no later than the Business Day preceding
the date on which the payments are due to the Swap Counterparty under the Swap
Agreement to distribute all amounts on deposit in the Euro Account to the Swap
Counterparty.
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E. On or prior to the fifth business day of each month, the Administrator
shall instruct the Indenture Trustee to make the following allocations on or
before the fifteenth calendar day of the same month with funds on deposit in the
Collection Account in the following order of priority:
1. deposit into the Future Distribution Account for the Servicer and the
Administrator, pro rata, the amount of the Servicing Fee and
Administration Fee that will accrue for the related calendar month
plus any previously accrued and unpaid or set aside Servicing Fee and
Administration Fee;
2. deposit into the Future Distribution Account, pro rata, for the
Auction Agent and the Broker-Dealers an amount equal to their Auction
Agent Fees and Broker-Dealer Fees, respectively, expected to be
payable from the calendar day after the current calendar month's
Quarterly Distribution Date through the following month's Quarterly
Distribution Date or Monthly Servicing Payment Date, as the case may
be, plus previously accrued and unpaid or set aside Auction Agent Fees
and Broker-Dealer Fees;
3. deposit into the Future Distribution Account, pro rata, for (a) each
class of the Class A Notes an amount equal to interest expected to
accrue on the Class A Notes from the calendar day after the current
calendar month's Quarterly Distribution Date through the following
month's Quarterly Distribution Date or Monthly Servicing Payment Date,
as the case may be, plus previously accrued and unpaid or set aside
interest and (b) the Swap Counterparty an amount equal to Swap
Interest Payments to the Swap Counterparty expected to accrue from the
day after the current calendar month's Quarterly Distribution Date
through the following month's Quarterly Distribution Date or Monthly
Servicing Payment Date, plus previously accrued and unpaid or set
aside Swap Interest Payments plus Swap Termination Payments under
Section 2.7C.4(b); and
4. deposit into the Future Distribution Account for the Class B Notes, an
amount equal to interest expected to accrue on the Class B Notes from
the day after the current calendar month's Quarterly Distribution Date
through the following month's Quarterly Distribution Date or Monthly
Servicing Payment Date, plus previously accrued and unpaid or set
aside interest.
F. On each Auction Rate Distribution Date that is not a Quarterly
Distribution Date, the Administrator shall instruct the Indenture Trustee to
make the following distributions in the following order of priority:
1. from amounts deposited in the Future Distribution Account that were
allocated to the Auction Agent and the Broker- Dealers, and then from
amounts on deposit in the Collection Account, pro rata, to the Auction
Agent and the Broker-Dealers, the Auction Agent Fees of the Auction
Agent and the Broker-Dealer Fees of the Broker-Dealers;
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2. from amounts deposited in the Future Distribution Account for the
benefit of the Class A Notes with a Distribution Date on this Auction
Rate Distribution Date, and then from amounts on deposit in the
Collection Account, pro rata, to the Class A Notes with a Distribution
Date on this Auction Rate Distribution Date, an amount equal to
interest payable on these Class A Notes; and
3. from amounts deposited in the Future Distribution Account that were
allocated to the Class B Notes on account of interest, and then from
amounts on deposit in the Collection Account, to the Class B Notes if
they have a Distribution Date on this Auction Rate Distribution Date,
an amount equal to interest payable on the Class B Notes.
All amounts deposited in the Future Distribution Account shall be deposited
therein for the benefit of an entity or a class of Notes. Each such amount shall
only be distributable to the entity or the class of Notes for whom it was so
deposited. Amounts on deposit in the Future Distribution Account with respect to
principal and Carry-Over Amounts allocated to the Auction Rate Notes shall be
paid to the Auction Rate Notes on their Auction Rate Distribution Dates.
G. If less than all of the Class A Auction Rate Notes are to be paid or
allocated principal sufficient to repay them in full on a Quarterly Distribution
Date, the Administrator shall determine the particular classes of Class A
Auction Rate Notes which will be paid or allocated principal on a Quarterly
Distribution Date. The Administrator shall make such determination as follows:
(1) first, the Administrator shall compute the number of $50,000 increments of
principal that are available to be paid or allocated to the Class A Auction Rate
Notes and (2) second, the Administrator shall pay or allocate such $50,000
increments in a manner that will preserve as nearly as practicable, the
respective original proportions of such Classes that remain outstanding, with
any excess increment that cannot be so paid or allocated being chosen by random
lot.
If less than all of the Auction Rate Notes of a given class are to be paid
or allocated principal on a Quarterly Distribution Date in amount sufficient to
pay such class in full, the particular Auction Rate Notes to be paid shall be
selected by the Administrator by random lots of $50,000. If there are any
amounts available to pay or allocated principal to the Class A Auction Rate
Notes or Class B Auction Rate Notes, as applicable that are not in $50,000
increments, the Administrator shall deposit such amounts to the Future
Distribution Account to pay principal to the Class A Auction Rate Notes or Class
B Auction Rate Notes, as applicable, in the future.
(m) Section 2.8 is deleted and replaced with the following:
SECTION 2.8.1 RESERVE ACCOUNT.
A. On the Closing Date, the Issuer shall deposit the Reserve Account
Initial Deposit into the Reserve Account.
B.1. In the event that the Primary Servicing Fee for any Monthly Servicing
Payment Date or Distribution Date exceeds the amount distributed to
the Servicer pursuant to Sections 2.7B and 2.7C.1 on such Monthly
Servicing Payment Date or Quarterly Distribution Date, the
Administrator shall instruct the Indenture Trustee
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in writing to withdraw from the Reserve Account on such Monthly
Servicing Payment Date or Quarterly Distribution Date an amount equal
to such excess, to the extent of funds available therein, and to
distribute such amount to the Servicer; provided, however, that,
except as provided in Section 2.8.1D, amounts on deposit in the
Reserve Account will not be available to cover any unpaid Carryover
Servicing Fees to the Servicer.
2. In the event that the Available Funds are insufficient to make the
payments described under Sections 2.7C.1 through 2.7C.5 (after giving
effect to Section 2.7F), the Administrator shall instruct the
Indenture Trustee in writing to withdraw from the Reserve Account on
each Quarterly Distribution Date an amount equal to such excess, to
the extent of funds available therein after giving effect to paragraph
B.1 above, and to distribute such amounts in the same order and
priority as is set forth in Sections 2.7C.1 through 2.7C.5.
3. In the event that the Class A Noteholders' Principal Distribution
Amount on the Note Final Maturity Date with respect to any class of
Class A Notes exceeds the amount distributed to such Class A
Noteholders pursuant to Section 2.7C.6, 2.7C.7, 2.7C.8, 2.7C.9,
2.7C.10, or 2.7C.11 on such date, the Administrator shall instruct the
Indenture Trustee in writing to withdraw from the Reserve Account on
such Note Final Maturity Date an amount equal to such excess, to the
extent of funds available therein after giving effect to paragraphs
B.1 and B.2 above, and to distribute such amount to the Class A
Noteholders entitled thereto, in the same order and priority as is set
forth in Sections 2.7C.6 through 2.7C.11.
4. In the event that the Class B Noteholders' Principal Distribution
Amount on the Class B Maturity Date exceeds the amount distributed to
the Class B Noteholders pursuant to Section 2.7C.12 on such date, the
Administrator shall instruct the Indenture Trustee in writing to
withdraw from the Reserve Account on the Class B Maturity Date an
amount equal to such excess, to the extent of funds available therein
after giving effect to paragraphs B.1 through B.3 above, and to
distribute such amount to the Class B Noteholders entitled thereto.
C.1. After giving effect to Section 2.8.1B, if the amount on deposit in the
Reserve Account on any Distribution Date (after giving effect to all
deposits or withdrawals therefrom on such Distribution Date other than
pursuant to this paragraph C) is greater than the Specified Reserve
Account Balance for such Distribution Date, the Administrator shall
instruct the Indenture Trustee in writing to withdraw the amount on
deposit in excess of the Specified Reserve Account Balance and deposit
such amount into the Collection Account.
D. On the final Distribution Date upon termination of the Trust and
following the payment in full of the aggregate outstanding principal
balance of the Notes and of all other amounts (other than Carryover
Servicing Fees, Carry-over Amounts and Swap Termination Payments)
owing or to be distributed hereunder or under the
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Indenture to Noteholders, the Servicer, the Swap Counterparty or the
Administrator, to the extent that Available Funds on such date are
insufficient to make the following payments, amounts remaining in the
Reserve Account shall be used first to pay any Carryover Servicing
Fees, second to pay any Class A Carry-over Amounts to the Class A
Noteholders, third to pay any Class B Carry-over Amounts to the Class
B Noteholders, and fourth to pay any Swap Termination Payments not
previously paid to the Swap Counterparty. Any amount remaining on
deposit in the Reserve Account after such payments have been made
shall be distributed to the Excess Distribution Certificateholder. The
Excess Distribution Certificateholder shall in no event be required to
refund any amounts properly distributed pursuant to this Section
2.8.1D.
E. Anything in this Section 2.8.1 to the contrary notwithstanding, if the
market value of securities and cash in the Reserve Account is on any
Distribution Date sufficient to pay the remaining principal amount of
and interest accrued on the Notes, and to pay any unpaid Carryover
Servicing Fee, Swap Termination Payment, and Carry-over Amounts, such
amount will be so applied on such Distribution Date and the
Administrator shall instruct the Eligible Lender Trustee and the
Indenture Trustee to make such payments.
SECTION 2.8.2 CAPITALIZED INTEREST ACCOUNT.
A. On the Closing Date, the Issuer shall deposit the Capitalized Interest
Account Initial Deposit into the Capitalized Interest Account.
B.1. In the event that the Class A Noteholders' Interest Distribution
Amount, any required Swap Payments and the Class B Noteholders'
Interest Distribution Amount for any Distribution Date through the
September 2004 Distribution Date exceeds the amounts distributed to
the Noteholders or the Swap Counterparty pursuant to Sections
2.7C.4(a), 2.7C.4(c) and 2.7C.5 on a Quarterly Distribution Date or
the Class A Noteholders' Interest Distribution Amount or the Class B
Noteholders' Interest Distribution Amount on any other Distribution
Date, the Administrator shall instruct the Indenture Trustee in
writing to withdraw from the Capitalized Interest Account an amount
equal to such excess, to the extent of funds available therein, and to
distribute such amount first, pro rata based on the amounts of such
shortfalls to the Class A Noteholders until they have received the
Class A Noteholders' Interest Distribution Amount for that
Distribution Date second, to the Swap Counterparty until it has
received the related required Swap Payments and third, to the Class B
Noteholders until they have received the Class B Noteholders' Interest
Distribution Amount for that Distribution Date.
B.2. After giving effect to Section 2.8.2B.1 on the September 2004
Distribution Date, the Administrator shall instruct the Indenture
Trustee in writing to withdraw any amounts remaining from the
Capitalized Interest Account and to distribute such amount to the
Depositor or its assignee, as Holder of the Excess Distribution
Certificate, excluding any Investment Earnings to be transferred to
the Collection Account on such Distribution Date.
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(n) Section 2.9.e is deleted, and Sections 2.9.f-j are redesignated as
Sections 2.9.e-i and the following is inserted as Section 2.9.j:
j. [RESERVED];
(o) The first sentence of the first paragraph after Section 2.9.n is
deleted and replaced with the following:
Each amount set forth pursuant to clauses (a), (b), (c), (d), (h), (i) and
(l) above shall be expressed as a factor per thousand of the outstanding
principal balance of a Note (other than with respect to the Class A-5 Notes,
which amount shall be expressed as a factor per thousand of the outstanding
principal balance of the Class A-5 Notes.
(p) The word "Quarterly" shall be inserted in front of "Distribution Date"
in Section 2.12 and Section 3.1.
(q) The last sentence of Section 3.1D is deleted and replaced with the
following:
In connection therewith, the Administrator shall calculate LIBOR and
EURIBOR for the first Accrual Period and One-Month and, Three-Month LIBOR and
Three-Month EURIBOR in accordance with the definitions thereof. In addition, the
Administrator hereby accepts the delegation to it of the obligations of the
"Calculation Agent" under any Interest Rate Cap Agreement to which the Trust is
a party.
(r) The "or" is deleted from subparagraph 4.2 (ii) and the "." is deleted
from subparagraph 4.2 (iii) and is replaced with ";".
(s) A new subparagraph, 4.2 (iv), is inserted as follows:
and
(iv) any claim for failure to comply with the provisions of 34 CFR Sec.
682.203(b) (other than for the Eligible Lender Trustee's failure to qualify as
an eligible lender under the Act).
(t) The "25%" in Section 5.1.B. and in the first clause following Section
5.1C are deleted and replaced with "50%".
(u) Sections 6.1A and B are deleted and replaced with the following:
SECTION 6.1 TERMINATION.
A. OPTIONAL PURCHASE OF ALL TRUST STUDENT LOANS. The Administrator shall
notify the Servicer, the Depositor and the Indenture Trustee in writing, within
15 days after the last day of any Collection Period as of which the then
outstanding Pool Balance is 12% or less of the Initial Pool Balance, of the
percentage that the then outstanding Pool Balance bears to the Initial Pool
Balance. As of the last day of any Collection Period immediately preceding a
Distribution Date as of which the then outstanding Pool Balance is 10% or less
of the Initial Pool Balance, the
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Eligible Lender Trustee on behalf and at the direction of the Servicer, or any
other "eligible lender" (within the meaning of the Higher Education Act)
designated by the Servicer in writing to the Eligible Lender Trustee and the
Indenture Trustee, shall have the option to purchase the Trust Estate, other
than the Trust Accounts. To exercise such option, the Servicer shall deposit
pursuant to Section 2.6 in the Collection Account an amount equal to the
aggregate Purchase Amount for the Trust Student Loans and the related rights
with respect thereto, plus the appraised value of any such other property held
by the Trust other than the Trust Accounts, such value to be determined by an
appraiser mutually agreed upon by the Servicer, the Eligible Lender Trustee and
the Indenture Trustee, and shall succeed to all interests in and to the Trust;
provided, however, that the Servicer may not effect such purchase if such
aggregate Purchase Amounts do not equal or exceed the Minimum Purchase Amount
plus any amount owing to the Swap Counterparty for Swap Payments or Swap
Termination Payments and any Carryover Servicing Fees. In the event the Servicer
fails to notify the Eligible Lender Trustee and the Indenture Trustee in writing
prior to the acceptance by the Indenture Trustee of a bid to purchase the Trust
Estate pursuant to Section 4.4 of the Indenture that the Servicer intends to
exercise its option to purchase the Trust Estate, the Servicer shall be deemed
to have waived its option to purchase the Trust Estate as long as the Servicer
has received 5 business days' notice from the Indenture Trustee as provided in
Section 4.4 of the Indenture.
(v) Section 8.5 is amended by inserting at the end of the first paragraph
the following:
and that such action will not materially adversely affect (i) the Trust's
ability to enforce or protect its rights or remedies under any swap
agreement, (ii) the ability of the Trust to timely and fully perform its
obligations under any swap agreement or (iii) any of the Trust's
obligations under any swap agreement or any swap transaction under such
agreement. Any such amendment, modification or supplement without the
consent of the Swap Counterparty shall not be binding on the Swap
Counterparty.
The parties hereto acknowledge and agree that, pursuant to Section 5(h) of
the Schedule to the Swap Agreement, the Trust has agreed (a) not to enter into
any amendment, modification or supplement to this Agreement or any other Basic
Document that would materially adversely affect (i) the Swap Counterparty's
ability to enforce or protect its rights or remedies under the Swap Agreement,
(ii) the ability of the Trust to timely and fully perform its obligations under
the Swap Agreement, or (iii) any of the terms of this Agreement (including this
supplement) which relates to payments to or rights of the Swap Counterparty
under the Basic Documents and (b) to obtain the written consent of the Swap
Counterparty to any such amendment, modification or supplement. Any such
amendment, modification or supplement without the written consent of the Swap
Counterparty shall be void and unenforceable.
Accordingly, the parties hereto acknowledge and agree that the Swap
Counterparty is a third party beneficiary of this Agreement (including this
supplement) to the extent of its rights under the Swap Agreement in respect of
this Agreement and shall be entitled to enforce such rights under this Agreement
(including this supplement). Notices to the Swap Counterparty under this Section
6 shall be addressed to the Swap Counterparty at the address listed in the Swap
Agreement.
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6. Each of the parties named on the signature pages to this Supplement by
execution of this Supplement agrees, for the benefit of the Administrator and
the other signatories hereto, to be bound by the terms of the Agreement in
connection with the Trust, this Supplement and the other Basic Documents to the
extent reference is made in the Agreement to such party. The rights and
obligations of such parties under the Agreement resulting from the execution of
this Supplement (other than the Depositor) shall be applicable only with respect
to the Trust, this Supplement and the other Basic Documents.
7. This Supplement shall be construed in accordance with the laws of the State
of New York, without reference to the conflict of law provisions thereof, and
the obligations, rights and remedies of the parties hereunder shall be
determined in accordance with such laws.
8. This Supplement may be executed in counterparts, each of which when so
executed shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Supplement to be
duly executed and delivered as of the date first above written.
SLM FUNDING LLC
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
XXXXXX XXX SERVICING L.P.
By: XXXXXX MAE, INC.,
Its general partner
By: /s/ J. XXXXX XXXXXX
Name: J. Xxxxx Xxxxxx
Title: Vice President
SLM STUDENT LOAN TRUST 2003-5
By: CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION, not in its individual
capacity but solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
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CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, not in its individual capacity but
solely as Eligible Lender Trustee
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Title: Vice President
THE BANK OF NEW YORK,
not in its individual capacity but solely as Indenture
Trustee
By: /s/ XXXX X. XXXXXXX
Name: Xxxx X. Xxxxxxx
Title: Agent
The Administrator hereby acknowledges receipt of the foregoing Supplement and
hereby confirms to the Depositor and the other signatories to the foregoing
Supplement that the representations of the Administrator contained in Article V
of the Agreement are true and correct as of the date of such Supplement.
STUDENT LOAN MARKETING ASSOCIATION
By: /s/ XXXXXXX X. XXXXXXX
Name: Xxxxxxx X. Xxxxxxx
Title: Vice President
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