1
Exhibit 4.3
TRUST AGREEMENT
among
PNC BANK, NATIONAL ASSOCIATION
as Depositor
THE FIRST NATIONAL BANK OF CHICAGO,
as Eligible Lender Trustee
and
FIRST CHICAGO DELAWARE INC.,
as Delaware Trustee
Dated as of March 27, 1997
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TABLE OF CONTENTS
PAGE
ARTICLE I
Definitions and Usage............................................................................. 1
ARTICLE II
ORGANIZATION
SECTION 2.1. Name............................................................................ 1
SECTION 2.2. Office and Situs of the Trust................................................... 1
SECTION 2.3. Purposes and Powers............................................................. 1
SECTION 2.4. Appointment of Eligible Lender Trustee and Delaware Trustee..................... 3
SECTION 2.5. Initial Capital Contribution of Trust
Estate ....................................................................... 3
SECTION 2.6. Declaration of Trust............................................................ 4
SECTION 2.7. No Liability of the Certificateholders.......................................... 4
SECTION 2.8. Title to Trust Property......................................................... 4
SECTION 2.9. Representations and Warranties of the
Depositor..................................................................... 5
SECTION 2.10. Federal Income Tax Allocations.................................................. 6
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1. Initial Beneficial Ownership.................................................... 7
SECTION 3.2 The Trust Certificates.......................................................... 8
SECTION 3.3. Authentication of Trust Certificates............................................ 8
SECTION 3.4. Registration of Transfer and Exchange
of Trust Certificates......................................................... 9
SECTION 3.5. Restrictions on Transfer ....................................................... 10
SECTION 3.6. Mutilated, Destroyed, Lost or Stolen
Trust Certificates............................................................ 12
SECTION 3.7. Persons Deemed Owners........................................................... 12
SECTION 3.8. Access to List of Certificateholders'
Names and Addresses........................................................... 13
SECTION 3.9. Maintenance of Office or Agency................................................. 13
SECTION 3.10. Appointment of Certificate Paying Agent......................................... 14
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ARTICLE IV
ACTIONS BY ELIGIBLE LENDER TRUSTEE
SECTION 4.1. Prior Notice to Certificateholders with
Respect to Certain Matters................................................... 15
SECTION 4.2. Action by Certificateholders with
Respect to Certain Matters................................................... 16
SECTION 4.3. Action by Certificateholders with
Respect to Bankruptcy........................................................ 16
SECTION 4.4. Restrictions on Certificateholders'
Power ....................................................................... 16
SECTION 4.5. Majority Control ....................................................................... 16
ARTICLE V
APPLICATION OF TRUST FUNDS;
CERTAIN DUTIES
SECTION 5.1. Application of Trust Funds.............................................................. 17
SECTION 5.2. Method of Payment....................................................................... 18
SECTION 5.3. Segregation of Moneys; No Interest...................................................... 18
SECTION 5.4. Accounting and Reports to the Note-
holders, Certificateholders,
the Internal Revenue Service and
Others ............................................................................... 18
SECTION 5.5. Signature on Returns; Tax Matters
Partner...................................................................... 19
ARTICLE VI
AUTHORITY AND DUTIES OF ELIGIBLE LENDER TRUSTEE
SECTION 6.1. General Authority....................................................................... 20
SECTION 6.2. General Duties.......................................................................... 20
SECTION 6.3. Action upon Instruction................................................................. 21
SECTION 6.4. No Duties Except as Specified in this
Agreement, the Transfer and Servicing
Agreement, any Supplemental Transfer
and Servicing Agreement or in
Instructions.......................................................................... 22
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SECTION 6.5. No Action Except Under Specified
Documents or Instructions.................................................... 23
SECTION 6.6. Restrictions................................................................... 23
ARTICLE VII
CONCERNING THE ELIGIBLE LENDER TRUSTEE
SECTION 7.1. Acceptance of Trusts and Duties................................................ 24
SECTION 7.2. Furnishing of Documents........................................................ 26
SECTION 7.3. Representations and Warranties................................................. 26
SECTION 7.4. Reliance; Advice of Counsel.................................................... 27
SECTION 7.5. Not Acting in Individual Capacity.............................................. 28
SECTION 7.6. Eligible Lender Trustee Not Liable for
Trust Certificates or Financed
Student Loans................................................................ 28
SECTION 7.7. Eligible Lender Trustee May Own Trust
Certificates and Notes....................................................... 29
SECTION 7.8. Representations and Warranties of Delaware Trustee............................. 29
ARTICLE VIII
COMPENSATION OF ELIGIBLE LENDER TRUSTEE
SECTION 8.1. Eligible Lender Trustee's Fees and
Expenses..................................................................... 30
SECTION 8.2. Payments to the Eligible Lender
Trustee...................................................................... 30
ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1. Termination of Trust Agreement................................................. 31
SECTION 9.2. Dissolution upon Insolvency of Depositor....................................... 32
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ARTICLE X
SUCCESSOR ELIGIBLE LENDER TRUSTEES AND
ADDITIONAL ELIGIBLE LENDER TRUSTEES
SECTION 10.1. Eligibility Requirements for
Eligible Lender Trustee...................................................... 34
SECTION 10.2. Resignation or Removal of Eligible
Lender Trustee............................................................... 34
SECTION 10.3. Successor Eligible Lender Trustee.............................................. 36
SECTION 10.4. Merger or Consolidation of Eligible
Lender Trustee............................................................... 37
SECTION 10.5. Appointment of Co-Eligible Lender
Trustee or Separate Eligible Lender
Trustee...................................................................... 37
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. Supplements and Amendments..................................................... 39
SECTION 11.2. No Legal Title to Trust Estate in
Certificateholders........................................................... 41
SECTION 11.3. Limitations on Rights of Others................................................ 40
SECTION 11.4. Notices........................................................................ 41
SECTION 11.5. Severability................................................................... 42
SECTION 11.6. Separate Counterparts.......................................................... 42
SECTION 11.7. Successors and Assigns......................................................... 42
SECTION 11.8. No Petition.................................................................... 42
SECTION 11.9. No Recourse.................................................................... 43
SECTION 11.10. Headings....................................................................... 43
SECTION 11.11. Governing Law.................................................................. 43
EXHIBIT A Form of Trust Certificate
EXHIBIT B Form of Purchaser's Representation and Warranty
Letter
APPENDIX A Definitions and Usage
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TRUST AGREEMENT dated as of March 27, 1997, between PNC BANK,
NATIONAL ASSOCIATION, as Depositor (the "Depositor"), and THE FIRST NATIONAL
BANK OF CHICAGO, not in its individual capacity but solely as Eligible Lender
Trustee (the "Eligible Lender Trustee") and FIRST CHICAGO DELAWARE INC., not in
its individual capacity but solely as Delaware Trustee (the "Delaware
Trustee").
The Depositor and the Eligible Lender Trustee hereby agree as
follows:
ARTICLE I
DEFINITIONS AND USAGE
Capitalized terms used but not defined herein are defined in
Appendix A attached hereto, which also contains rules as to construction and
usage that are applicable herein.
ARTICLE II
ORGANIZATION
SECTION 2.1. NAME. The Trust created hereby shall be known as
"PNC Student Loan Trust I," in which name the Eligible Lender Trustee may
conduct the business of the Trust, make and execute contracts and other
instruments on behalf of the Trust and xxx and be sued.
SECTION 2.2. OFFICE AND SITUS OF THE TRUST. The registered
office of the Issuer in Delaware of the Delaware Trustee shall be the office at
000 Xxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx 00000 and the situs of the Trust shall be
at the corporate trust office of the Eligible Lender Trustee located at Xxx
Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, XX 00000-0000.
SECTION 2.3. PURPOSES AND POWERS. The purpose of the Trust is
to engage in the following activities:
(i) to issue one or more Classes of the Trust
Certificates pursuant to this Agreement and, if applicable, one or
more Trust Supplements, and to sell the Trust Certificates in one or
more transactions;
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(ii) to issue one or more Series of Notes pursuant to the
Master Indenture and the applicable Terms Supplement and to sell the
Notes in one or more transactions in accordance with instructions
received from the Administrator;
(iii) with the proceeds of the sale of the Notes and the
Trust Certificates, to acquire, from time to time, the Financed
Student Loans;
(iv) to assign, grant, transfer, pledge, mortgage and
convey the Trust Estate pursuant to the Indenture and the applicable
Terms Supplement and to hold, manage and distribute to the
Certificateholders pursuant to the terms of the Transfer and Servicing
Agreement any portion of the Trust Estate released from the Lien of,
and remitted to the Trust pursuant to, the Indenture and the
applicable Terms Supplement;
(v) from time to time to sell and dispose of the Financed
Student Loans in accordance with the terms of the Basic Documents;
(vi) to enter into and perform its obligations under the
Basic Documents to which it is to be a party;
(vii) to engage in those activities, including entering
into agreements, that are necessary, suitable or convenient to
accomplish the foregoing or are incidental thereto or connected
therewith; and
(viii) to engage in such other activities as may be
required in connection with conservation of the Trust Estate and the
making of distributions to the Certificateholders, the Noteholders and
the others specified in Article V of the Transfer and Servicing
Agreement and or contemplated by the Basic Documents.
The Trust shall not engage in any activity other than in connection with the
foregoing or other than as required or authorized by the terms of this
Agreement or the other Basic Documents. Notwithstanding anything in this
Agreement or the
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Basic Documents to the contrary, for so long as the Depositor is a
Certificateholder, the Trust's activities shall be limited to activities that
are part of, or incidental to, the business of banking.
This Section 2.3 shall not be amended without the prior
written unanimous consent of the Certificateholders, including the Depositor.
SECTION 2.4. APPOINTMENT OF ELIGIBLE LENDER TRUSTEE AND
DELAWARE TRUSTEE. (a) The Depositor hereby (i) appoints the Eligible Lender
Trustee as trustee of the Trust effective as of the date hereof, to have all
the rights, powers and duties set forth herein, and (ii) ratifies all actions
of the Eligible Lender Trustee taken on behalf of the Trust prior to the
execution hereof.
(b) The Delaware Trustee is hereby appointed to serve as
the trustee of the Trust in the State of Delaware for the sole purpose of
satisfying the requirement of Section 3807 of the Business Trust Statute that
the Trust have at least one trustee with a principal place of business in
Delaware. It is understood and agreed by the parties hereto and the
Certificateholders that the Delaware Trustee shall have none of the duties or
liabilities of the Eligible Lender Trustee. The duties of the Delaware Trustee
shall be limited to (a) accepting legal process served on the Trust in the
State of Delaware and (b) the execution of any certificates required to be
filed with the Delaware Secretary of State, which the Delaware Trustee is
required to execute under Section 3811 of the Business Trust Statute. To the
extent that, at law or in equity, the Delaware Trustee has duties (including
fiduciary duties) and liabilities relating to the Trust or the
Certificateholders, it is hereby understood and agreed by the other parties
hereto and the Certificateholders that such duties and liabilities are replaced
by the duties and liabilities of the Delaware Trustee expressly set forth in
this Agreement.
SECTION 2.5. INITIAL CAPITAL CONTRIBUTION OF TRUST ESTATE.
The Depositor hereby sells, assigns, transfers, conveys and sets over to the
Eligible Lender Trustee, as of the date hereof, the sum of $10.00. The Eligible
Lender Trustee hereby acknowledges receipt in trust from the Depositor of the
foregoing contribution, which shall constitute the initial Trust Estate and
shall be deposited in the Collection Account.
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SECTION 2.6. DECLARATION OF TRUST. The Eligible Lender
Trustee hereby declares that it will hold the Trust Estate in trust upon and
subject to the conditions set forth herein for the use and benefit of the
Certificateholders, subject to the obligations of the Trust under the other
Basic Documents. It is the intention of the parties hereto that the Trust
constitute a business trust under Delaware law and that this Agreement
constitute the governing instrument of such trust. If for any reason it is
determined that the Trust does not qualify as a business trust under Delaware
law, it shall be a trust, nonetheless, under the common law of Delaware. It is
the intention of the parties hereto that, solely for federal, state and local
income, franchise and similar tax purposes, the Trust shall be treated as a
partnership, with the assets of the partnership being the Financed Student
Loans and other assets held by the Trust, the partners of the partnership being
the Certificateholders and the Notes being debt of the partnership. The parties
agree that, unless otherwise required by appropriate federal, state or local
tax authorities, they shall treat the Trust as a partnership for Federal tax
purposes, and the Trust will file or cause to be filed annual or other
necessary returns, reports and other forms consistent with the characterization
of the Trust as a partnership for Federal tax purposes, and Depositor will not
make, or cause to be made, an election under the provisions of Treasury
Regulation Section 301.7701-3 to classify the Trust an association and shall
take, or cause to be taken, necessary and appropriate actions consistent with
carrying out the intent of this Section 2.6. Effective as of the date hereof,
the Eligible Lender Trustee shall have all rights, powers and duties set forth
herein with respect to accomplishing the purposes of the Trust.
SECTION 2.7. NO LIABILITY OF THE CERTIFICATEHOLDERS.
No Certificateholder shall have any personal liability for any liability or
obligation of the Trust.
SECTION 2.8. TITLE TO TRUST PROPERTY. Legal title to all the
Trust Estate shall be vested at all times in the Trust as a separate legal
entity except where applicable law in any jurisdiction requires title to any
part of the Trust Estate to be vested in a trustee or trustees, in which case
title shall be deemed to be vested in the Eligible Lender Trustee, a co-trustee
and/or a separate trustee, as the case may be; provided that legal title to the
Financed Student Loans shall be vested at all times in the Eligible Lender
Trustee on behalf of the Trust.
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SECTION 2.9. REPRESENTATIONS AND WARRANTIES OF THE DEPOSITOR.
The Depositor hereby represents and warrants to the Eligible Lender Trustee
that:
(a) The Depositor is duly organized, validly existing as a
national banking association, with corporate power and authority to
own its properties and to conduct its business as such properties are
currently owned and such business is presently conducted except for
such power and authority the absence of which would not have a
material adverse effect on the Depositor.
(b) The Depositor has the requisite corporate power and
authority to execute and deliver this Agreement and to carry out its
terms; the Depositor has requisite corporate power and authority to
sell and assign the property to be sold and assigned to and deposited
with the Trust (or with the Eligible Lender Trustee on behalf of the
Trust) and the Depositor has duly authorized such sale and assignment
and deposit to the Trust (or to the Eligible Lender Trustee on behalf
of the Trust) by all necessary corporate action on the Depositor's
part; and the execution, delivery and performance of this Agreement
has been duly authorized by the Depositor by all necessary corporate
action on their respective parts.
(c) This Agreement has been duly executed and delivered by
the Depositor, and constitutes a legal, valid and binding obligation
of the Depositor enforceable against the Depositor in accordance with
its terms, subject to the effect of applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws
relating to or affecting creditors' rights generally and court
decisions with respect thereto and subject to the application of
equitable principles in any proceeding, whether at law or in equity.
(d) The consummation of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof do not violate with,
result in any breach of any of the terms and provisions of, or
constitute (with or without notice or lapse of time or both) a default
under, the articles of incorporation or by-laws of the Depositor, or
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any material indenture, agreement or other material instrument to
which the Depositor is a party or by which it is bound; nor result in
the creation or imposition of any Lien upon any of its properties
pursuant to the terms of any such material indenture, agreement or
other material instrument (other than pursuant to the Basic
Documents); nor violate any law or, to the Depositor's knowledge, any
order, rule or regulation applicable to the Depositor of any court or
of any Federal or State regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the
Depositor or its properties except for such violations which would not
have a material adverse effect on the Depositor.
(e) No consent of any Federal or state governmental or
administrative authority is required to be obtained by the Depositor
prior to its entering into this Agreement or in connection with its
consummation of the transactions expressly contemplated by the Basic
Documents, other than those that have been obtained except such as may
be required by the blue sky laws of any jurisdiction in connection
with the sale of and distribution of the Notes and Certificates for
which no representation is being made.
SECTION 2.10. Federal Income Tax Allocations. Interest
payments on the Certificates at the Certificate rate (including interest on
amounts previously due on the Certificates but not yet distributed) shall be
treated as "guaranteed payments" under Section 707(c) of the Code. Net income
of the Trust for tax year as determined for federal income tax purposes (and
each item of income, gain, loss and deduction entering into the computation
thereof) shall be allocated:
(a) among Certificateholders in proportion to their ownership
of principal amount of Trust Certificates on such date, an amount of
net income up to the sum of (i) the portion of the market discount on
the Financed Student Loans accrued during such tax year that is
allocable to the excess, if any, of the initial aggregate principal
amount of the Trust Certificates over their initial aggregate issue
price, (ii) prepayment premium, if any, payable to the
Certificateholders for such tax year and (iii) any other amounts of
income payable to the Certificateholders for such tax year; and such
sum of amounts specified in
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clauses (i) through (iii) of this sentence shall be reduced by any
amortization by the Trust of premium on Financed Student Loans that
corresponds to any excess of the issue price of Certificates over
their principal amount; and
(b) any remaining net income shall thereafter be allocated to
the Depositor.
If the net income of the Trust for any tax year is insufficient for the
allocations described in clause (a) above, subsequent net income shall first be
allocated to make up such shortfall before being allocated as provided in the
preceding sentence. Net losses of the Trust, if any, for any tax year as
determined for federal income tax purposes (and each item of income, gain, loss
and deduction entering into the computation thereof) shall be allocated to the
Depositor to the extent the Depositor is reasonably expected to bear the
economic burden of such net losses, and any remaining net losses shall be
allocated among the Certificateholders as of the close of business on the last
day of such tax year in proportion to their ownership of principal amount of
Trust Certificates on such day. The Depositor is authorized to modify the
allocations in this paragraph is necessary or appropriate, in its sole
discretion, for the allocations to fairly reflect the economic income, gain or
loss to the Depositor or to the Certificateholder, or as otherwise required by
the Code.
For purposes of Treasury regulation Section 1.752-3(a)(3),
the Depositor's interest in the Trust shall be equal to one hundred percent
(100%) and, accordingly, the Depositor's share of the "nonrecourse liabilities"
of the Trust under Section 752 of the Code and the Depositor's share of the
"nonrecourse deductions" of the Trust under Section 704 of the Code shall be
one hundred percent (100%).
ARTICLE III
TRUST CERTIFICATES AND TRANSFER OF INTERESTS
SECTION 3.1. INITIAL BENEFICIAL OWNERSHIP. Upon the formation
of the Trust by the contribution by the Depositor pursuant to Section 2.5 and
until the initial issuance of the Trust Certificates, the Depositor shall be
the sole beneficial owner of the Trust.
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SECTION 3.2. THE TRUST CERTIFICATES. The Trust Certificates
shall be substantially in the form of Exhibit A. The Trust Certificates shall
be issued in minimum denominations of $10.00 and integral multiples of $10 in
excess thereof. The Trust Certificates shall be executed on behalf of the Trust
by manual or facsimile signature of an authorized officer of the Eligible
Lender Trustee. Trust Certificates bearing the manual or facsimile signatures
of individuals who were, at the time when such signatures shall have been
affixed, authorized to sign on behalf of the Trust, shall be valid and binding
obligations of the Trust, notwithstanding that such individuals or any of them
shall have ceased to be so authorized prior to the authentication and delivery
of such Trust Certificates or did not hold such offices at the date of
authentication and delivery of such Trust Certificates
SECTION 3.3. AUTHENTICATION OF TRUST CERTIFICATES. (a) On the
Closing Date, the Eligible Lender Trustee shall cause the Trust Certificates in
an aggregate principal amount equal to $1,000 to be executed on behalf of the
Trust, authenticated and delivered to or upon the written order of the
Depositor, signed by its chairman of the board, its president or any vice
president, without further action by the Depositor, in authorized denominations
in exchange for the amount contributed to the Trust pursuant to Section 2.5 and
$990 in cash payable by the initial Certificateholders on the Closing Date.
Such Trust Certificates shall be designated as the PNC Student Loan Trust
1997-1 Asset-Backed Certificates. No Trust Certificate shall entitle its holder
to any benefit under this Agreement, or shall be valid for any purpose, unless
there shall appear on such Trust Certificate a certificate of authentication
substantially in the form set forth in Exhibit A, executed by the Eligible
Lender Trustee by manual signature; such authentication shall constitute
conclusive evidence that such Trust Certificate shall have been duly
authenticated and delivered hereunder. All Trust Certificates shall be dated
the date of their authentication. No further Trust Certificates shall be issued
except pursuant to Section 3.4 or 3.5 hereunder.
(b) In connection with the initial issuance of the Trust Certificates
the Depositor hereby makes the following representations and warranties:
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(i) It is not (1) an employee benefit plan, retirement arrangement,
individual retirement account or Xxxxx plan subject to either Title I of the
Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of
the Internal Revenue Code of 1986, as amended, or (2) an entity (including an
insurance company general account) whose underlying assets include plan assets
by reason of any such plan's arrangements or account's investment in any such
entity.
(ii) It is a U.S. Person as defined in Section 7701(a)(30) of the
Code.
(iii) It understands that the Trust Certificates will be offered in a
transaction not involving any public offering within the meaning of the
Securities Act, and that, if in the future it decides to resell, pledge or
otherwise transfer any Trust Certificates, such Trust Certificates may be
resold, pledged or transferred only (a) to a person who the seller reasonably
believes is an institutional "accredited investor" as defined in Rule
501(a)(1)-(3) under the Securities Act that purchases for its own account or
for the account of another institutional accredited investor or (b) pursuant to
an effective registration statement under the Securities Act.
SECTION 3.4. REGISTRATION OF TRANSFER AND EXCHANGE OF TRUST
CERTIFICATES. The Certificate Registrar shall keep or cause to be kept, at the
office or agency maintained pursuant to Section 3.9, a Certificate Register in
which, subject to such reasonable regulations as it may prescribe, the Eligible
Lender Trustee shall provide for the registration of Trust Certificates and of
transfer and exchanges of Trust Certificates as provided herein. The Eligible
Lender Trustee shall be the Certificate Registrar.
Upon surrender for registration of transfer of any Trust
Certificate at the office or agency maintained pursuant to Section 3.9, and
compliance with the provisions set forth in Section 3.5, the Eligible Lender
Trustee shall execute, authenticate and deliver in the name of the designated
transferee or transferees, one or more new Trust Certificates in authorized
denominations of a like aggregate amount dated the date of authentication by
the Eligible Lender Trustee or any authenticating agent. At the option of a
Certificateholder, Trust Certificates may be exchanged for other Trust
Certificates of authorized denominations of a like aggregate amount upon
surrender of the Trust Certificates to be exchanged at the office or agency
maintained pursuant to Section 3.9.
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Every Trust Certificate presented or surrendered for
registration of transfer or exchange shall be accompanied by a written
instrument of transfer in form satisfactory to the Eligible Lender Trustee and
the Certificate Registrar duly executed by the Certificateholder or his
attorney duly authorized in writing, with such signature guaranteed by an
entity acceptable to the Eligible Lender Trustee. Each Trust Certificate
surrendered for registration of transfer or exchange shall be canceled and
subsequently disposed of by the Eligible Lender Trustee in accordance with its
customary practice.
No service charge shall be made for any registration of
transfer or exchange of Trust Certificates, but the Eligible Lender Trustee or
the Certificate Registrar may require payment of a sum sufficient to cover any
tax or governmental charge that may be imposed in connection with any transfer
or exchange of Trust Certificates.
The preceding provisions of this Section 3.4 notwithstanding,
the Eligible Lender Trustee shall not be required to make and the Certificate
Registrar need not register transfers or exchanges of Trust Certificates for a
period of 15 days preceding any Distribution Date.
SECTION 3.5. RESTRICTIONS ON TRANSFER. (a) Except for the initial
sale of the Trust Certificates, the Trust Certificates may not be offered or
sold except to institutional "accredited investors" (as defined in Rule
501(a)(1)-(3) under the Securities Act who are U.S. Persons (as defined in
Section 7701(a)(30) of the Code) in reliance on an exemption from the
registration requirements of the Securities Act.
The Trust Certificates have not been registered or qualified under
the Securities Act, or any state securities law. No transfer, sale, pledge or
other disposition of any Trust Certificate shall be made unless such
disposition is made pursuant to an effective registration statement under the
Securities Act and effective registration or qualification under applicable
state securities laws, or is made in a transaction which does not require such
registration or qualification. In the event that a transfer is to be made in
reliance upon an exemption from the Securities Act, the Eligible Lender Trustee
may require, in order to assure compliance with the Securities Act, that the
Certificateholder's prospective transferee certify
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to the Eligible Lender Trustee in writing the facts surrounding such
disposition. Unless the Eligible Lender Trustee requests otherwise, such
certification shall be substantially in the form of Exhibit B hereto. In the
event that such certification of facts does not on its face establish the
availability of an exemption under the Securities Act, the Eligible Lender
Trustee may require an opinion of counsel satisfactory to it that such transfer
may be made pursuant to an exemption from the Securities Act, which opinion of
counsel shall not be an expense of the Eligible Lender Trustee or of the Trust.
(b) Each Trust Certificate will bear a legend substantially
to the following effect:
"THIS TRUST CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT") OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF,
BY PURCHASING THIS TRUST CERTIFICATE, AGREES THAT THIS TRUST CERTIFICATE MAY BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE
STATE SECURITIES LAWS AND (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(A)(1)-(3)
UNDER THE ACT THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF AN
INSTITUTIONAL ACCREDITED INVESTOR, OR (2) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT.
THIS TRUST CERTIFICATE MAY NOT BE TRANSFERRED DIRECTLY OR INDIRECTLY TO (1)
EMPLOYEE BENEFIT PLANS, RETIREMENT ARRANGEMENTS, INDIVIDUAL RETIREMENT ACCOUNTS
OR XXXXX PLANS SUBJECT TO EITHER TITLE I OF THE EMPLOYEE RETIREMENT INCOME
SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL REVENUE CODE
OF 1986, AS AMENDED, OR (2) ENTITIES (INCLUDING INSURANCE COMPANY GENERAL
ACCOUNTS) WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY SUCH
PLAN'S ARRANGEMENTS OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER, THIS
TRUST CERTIFICATE MAY BE TRANSFERRED ONLY TO A UNITED STATES PERSON WITHIN THE
MEANING OF SECTION 7701(A)(30) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED.
THIS TRUST CERTIFICATE DOES NOT REPRESENT DEPOSITS OR OBLIGATIONS OF OR ANY
INTEREST IN PNC BANK, NATIONAL ASSOCIATION, THE FIRST NATIONAL BANK OF CHICAGO
OR FIRST CHICAGO DELAWARE INC.
THIS TRUST CERTIFICATE IS NOT GUARANTEED OR INSURED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY GOVERNMENTAL AGENCY.
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AS LONG AS THE SERIES 1997-1 NOTES ARE OUTSTANDING, THIS TRUST CERTIFICATE MAY
NOT BE SOLD, PLEDGED OR TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT OF XXXXX
XXXXXX MORTGAGE CAPITAL GROUP, INC., WHICH MAY NOT BE UNREASONABLY WITHHELD."
(c) The Trust Certificates may not at any time be sold,
pledged or otherwise transferred without the prior written consent of Xxxxx
Xxxxxx Mortgage Capital Group, Inc., which may not be unreasonably withheld.
SECTION 3.6. MUTILATED, DESTROYED, LOST OR STOLEN TRUST
CERTIFICATES. If (a) any mutilated Trust Certificate shall be surrendered to
the Certificate Registrar, or if the Certificate Registrar shall receive
evidence to its satisfaction of the destruction, loss or theft of any Trust
Certificate and (b) there shall be delivered to the Certificate Registrar and
the Eligible Lender Trustee such security or indemnity as may be required by
them to save each of them harmless, then in the absence of notice that such
Trust Certificate shall have been acquired by a bona fide purchaser, the
Eligible Lender Trustee on behalf of the Trust shall execute and the Eligible
Lender Trustee shall authenticate and deliver, in exchange for or in lieu of
any such mutilated, destroyed, lost or stolen Trust Certificate, a new Trust
Certificate of like tenor and denomination. In connection with the issuance of
any new Trust Certificate under this Section, the Eligible Lender Trustee and
the Certificate Registrar may require the payment of a sum sufficient to cover
any tax or other governmental charge that may be imposed in connection
therewith. Any duplicate Trust Certificate issued pursuant to this Section
shall constitute conclusive evidence of ownership in the Trust, as if
originally issued, whether or not the lost, stolen or destroyed Trust
Certificate shall be found at any time.
SECTION 3.7. PERSONS DEEMED OWNERS. Prior to due presentation
of a Trust Certificate for registration of transfer, the Eligible Lender
Trustee or the Certificate Registrar and any agent of any thereof may treat the
Person in whose name any Trust Certificate shall be registered in the
Certificate Register as the owner of such Trust Certificate for the purpose of
receiving distributions pursuant to Section 5.1 and for all other purposes
whatsoever, and neither the Eligible Lender Trustee or the Certificate
Registrar nor any agent of any thereof shall be bound by any notice to the
contrary.
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SECTION 3.8. ACCESS TO LIST OF CERTIFICATEHOLDERS' NAMES AND
ADDRESSES. The Eligible Lender Trustee shall furnish or cause to be furnished
to the Depositor within 15 days after receipt by the Eligible Lender Trustee of
a request therefor from the Depositor in writing, a list, in such form as the
Depositor may reasonably require, of the names and addresses of the
Certificateholders as of the most recent Record Date. If three or more
Certificateholders or one or more Certificateholders evidencing not less than
25% of the Certificate Balance apply in writing to the Eligible Lender Trustee,
and such application states that the applicants desire to communicate with
other Certificateholders with respect to their rights under this Agreement or
under the Trust Certificates and such application is accompanied by a copy of
the communication that such applicants propose to transmit, then the Eligible
Lender Trustee shall, within five Business Days after the receipt of such
application, afford such applicants access during normal business hours to the
current list of Certificateholders. Upon receipt of any such application, the
Eligible Lender Trustee will promptly notify the Depositor by providing a copy
of such application and a copy of the list of Certificateholders produced in
response thereto. Each Certificateholder, by receiving and holding a Trust
Certificate shall be deemed to have agreed not to hold any of the Depositor,
the Certificate Registrar or the Eligible Lender Trustee accountable by reason
of the disclosure of its name and address, regardless of the source from which
such information was derived.
SECTION 3.9. MAINTENANCE OF OFFICE OR AGENCY. The Eligible
Lender Trustee shall maintain in (Borough of Manhattan, City of New York) an
office or offices or agency or agencies where Trust Certificates may be
surrendered for registration of transfer or exchange and where notices and
demands to or upon the Eligible Lender Trustee in respect of the Trust
Certificates and the other Basic Documents may be served. The Eligible Lender
Trustee initially designates its corporate trust office at The First National
Bank of Chicago, Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000,
as such office. The Eligible Lender Trustee shall give prompt written notice to
the Depositor and to the Certificateholders of any change in the location of
the Certificate Register or any such office or agency.
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SECTION 3.10. APPOINTMENT OF CERTIFICATE PAYING AGENT. The
Certificate Paying Agent shall make distributions to Certificateholders from
the amounts received from the Indenture Trustee out of the Trust Accounts
pursuant to Section 5.1 and shall report the amounts of such distributions to
the Eligible Lender Trustee. Any Certificate Paying Agent shall have the
revocable power to receive such funds from the Indenture Trustee for the
purpose of making the distributions referred to above. The Eligible Lender
Trustee may revoke such power and remove the Certificate Paying Agent if the
Majority Certificateholder determines in its sole discretion that the
Certificate Paying Agent shall have failed to perform its obligations under
this Agreement in any material respect. The Certificate Paying Agent shall
initially be the Eligible Lender Trustee, and any co-paying agent chosen by the
Eligible Lender Trustee acceptable to the Majority Certificateholder, which
consent shall not be unreasonably withheld. The Eligible Lender Trustee shall
furnish the Indenture Trustee and the Majority Certificateholder with a notice
identifying each co-paying agent within two days of any such appointment. The
Eligible Lender Trustee shall be permitted to resign as Certificate Paying
Agent upon 30 days' written notice to the Eligible Lender Trustee and the
Majority Certificateholder. If the Eligible Lender Trustee shall no longer be
the Certificate Paying Agent, the Eligible Lender Trustee, subject to the prior
written consent of the Majority Certificateholder (which consent shall not be
unreasonably withheld), shall appoint a successor to act as Certificate Paying
Agent (which shall be a bank or trust company). The Eligible Lender Trustee
shall cause such successor Certificate Paying Agent or any additional
Certificate Paying Agent appointed by the Eligible Lender Trustee to execute
and deliver to the Eligible Lender Trustee an instrument in which such
successor Certificate Paying Agent or additional Certificate Paying Agent shall
agree with the Eligible Lender Trustee that, as Certificate Paying Agent, such
successor Certificate Paying Agent or additional Certificate Paying Agent will
hold all sums, if any, held by it for payment to the Certificateholders in
trust for the benefit of the Certificateholders entitled thereto until such
sums shall be paid to such Certificateholders. The Certificate Paying Agent
shall return all unclaimed funds to the Eligible Lender Trustee and upon
removal of a Certificate Paying Agent such Certificate Paying Agent shall also
return all funds in its possession to the Eligible Lender Trustee. The
provisions of Sections 7.1, 7.3, 7.4, 7.5 and 8.1 shall apply to
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the Eligible Lender Trustee also in its role as Certificate Paying Agent, for
so long as the Eligible Lender Trustee shall act as Certificate Paying Agent
and, to the extent applicable, to any other paying agent appointed hereunder.
Any reference in this Agreement to the Certificate Paying Agent shall include
any co-paying agent unless the context requires otherwise.
ARTICLE IV
ACTIONS BY ELIGIBLE LENDER TRUSTEE
SECTION 4.1. PRIOR NOTICE TO CERTIFICATEHOLDERS WITH RESPECT
TO CERTAIN MATTERS. With respect to the following matters, the Eligible Lender
Trustee shall not take action unless at least 30 days before the taking of such
action the Eligible Lender Trustee shall have notified the Certificateholders
in writing of the proposed action and the Majority Certificateholder shall not
have notified the Eligible Lender Trustee in writing prior to the 30th day
after such notice is given that the Majority Certificateholder has withheld
consent:
(a) the initiation of any material claim or lawsuit by the
Trust (except claims or lawsuits brought in connection with the
collection of the Financed Student Loans) and the compromise of any
material action, claim or lawsuit brought by or against the Trust
(except with respect to the aforementioned claims or lawsuits for
collection of Financed Student Loans);
(b) the amendment of the Indenture or a Terms Supplement by a
supplemental indenture;
(c) the amendment, change or modification of the
Administration Agreement; or
(d) the appointment pursuant to the Indenture or a Terms
Supplement of a successor Note Registrar or Indenture Trustee or
pursuant to this Agreement of a successor Certificate Registrar or
Certificate Paying Agent, or the consent to the assignment by the Note
Registrar, Certificate Paying Agent or Indenture Trustee or
Certificate Registrar of its obligations under the Indenture or this
Agreement, as applicable.
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SECTION 4.2. ACTION BY CERTIFICATEHOLDERS WITH RESPECT TO
CERTAIN MATTERS. The Eligible Lender Trustee shall not have the power, except
upon the direction of the Majority Certificateholders or, with the Majority
Certificateholder's consent, to (a) remove the Master Servicer or the
Administrator under the Transfer and Servicing Agreement pursuant to Section
8.1 thereof or (b) except as expressly provided in the Basic Documents, sell
the Financed Student Loans after the termination of the Indenture. The Eligible
Lender Trustee shall take the actions referred to in the receding sentence only
upon written instructions signed by the Majority Certificateholder.
SECTION 4.3. ACTION BY CERTIFICATEHOLDERS WITH RESPECT TO
BANKRUPTCY. The Eligible Lender Trustee shall not have the power to commence a
voluntary proceeding in bankruptcy relating to the Trust without the unanimous
prior approval of all Certificateholders and the delivery to the Eligible
Lender Trustee by each such Certificateholder of a certificate certifying that
such Certificateholder reasonably believes that the Trust is insolvent.
SECTION 4.4. RESTRICTIONS ON CERTIFICATEHOLDERS' POWER. The
Certificateholders shall not direct the Eligible Lender Trustee to take or
refrain from taking any action if such action or inaction would be contrary to
any obligation of the Trust or the Eligible Lender Trustee under this Agreement
or any of the other Basic Documents or would be contrary to Section 2.3 nor
shall the Eligible Lender Trustee be permitted to follow any such direction, if
given.
SECTION 4.5. MAJORITY CONTROL. Except as expressly provided
herein, any action that may be taken by the Certificateholders under this
Agreement may be taken by the Majority Certificateholders evidencing not less
than 50.1% of the Certificate Balance. Except as expressly provided herein, any
written notice of the Certificateholders delivered pursuant to this Agreement
shall be effective if signed by the Majority Certificateholders evidencing not
less than 50.1% of the Certificate Balance at the time of the delivery of such
notice.
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ARTICLE V
APPLICATION OF TRUST FUNDS; CERTAIN DUTIES
SECTION 5.1. APPLICATION OF TRUST FUNDS. (a) No later than
the close of business on the day it receives funds distributed by the Indenture
Trustee pursuant to Sections 5.5, 5.6 and 5.10 of the Transfer and Servicing
Agreement, the Certificate Paying Agent will distribute such amounts to Trust
Certificateholders on a pro rata basis, based upon the portion of the
Certificate Balance held by such Certificateholder; provided, however, that if
the Eligible Lender Trustee receives funds for distribution to
Certificateholders after 11:00 a.m. on any day it shall use all reasonable
efforts to distribute such funds to the applicable Certificateholders on such
day but shall not be liable for any damages if such funds are distributed on
the following Business Day. Notwithstanding the foregoing, all amounts received
by the Eligible Lender Trustee from the Indenture Trustee representing amounts
in the Reserve Account in excess of the Specified Reserve Account Balance shall
be distributed to the Depositor (but such distributions shall not reduce the
principal amount of the Trust Certificates held by the Depositor) and no other
Certificateholder shall be entitled to have a claim for such amounts.
(b) No later than the Business Day following its receipt
thereof, the Eligible Lender Trustee shall send to each Trust Certificateholder
the statement provided to the Eligible Lender Trustee by the Administrator
pursuant to Section 5.7 of the Transfer and Servicing Agreement relating to
such Certificate Distribution Date.
(c) If any withholding tax is imposed on the Trust's payment
(or allocations of income) to a Certificateholder, such tax shall reduce the
amount otherwise distributable to the Certificateholder in accordance with this
Section. The Eligible Lender Trustee is hereby authorized to and shall, upon
receipt of written instructions of the Administrator identifying the
appropriate amount, to retain from amounts otherwise distributable to the
Certificateholders sufficient funds for the payment of any tax that is legally
owed by the Trust (but such authorization shall not prevent the Eligible Lender
Trustee from contesting any such tax in appropriate proceedings, and
withholding payment of such tax, if permitted by law, pending
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the outcome of such proceedings). The amount of any withholding tax imposed
with respect to a Certificateholder shall be treated as cash distributed to
such Certificateholder at the time it is withheld by the Trust to be remitted
to the appropriate taxing authority. If there is a possibility that withholding
tax is payable with respect to a distribution (such as a distribution to a
non-U.S. Certificateholder), the Eligible Lender Trustee in its sole
discretion may (but unless otherwise required by law shall not be obligated to)
withhold such amounts in accordance with this paragraph (c). In the event that
a Certificateholder wishes to apply for a refund of any such withholding tax,
the Eligible Lender Trustee and the Administrator shall reasonably cooperate
with such Certificateholder in making such claim so long as such
Certificateholder agrees to reimburse the Eligible Lender Trustee and the
Administrator for any reasonable out-of-pocket expenses incurred.
SECTION 5.2. METHOD OF PAYMENT. Subject to Section 9.1(c),
distributions required to be made to Certificateholders on any Distribution
Date shall be made to each Certificateholder of record on the applicable Record
Date either by wire transfer, in immediately available funds, to the account of
such Certificateholder at a bank or other entity having appropriate facilities
therefore, if such Certificateholder shall have provided to the Certificate
Registrar appropriate written instructions (which may be standing instructions)
at least five Business Days prior to such Distribution Date or, if not, by
check mailed to such Certificateholder at the address of such Certificateholder
appearing in the Certificate Register.
SECTION 5.3. SEGREGATION OF MONEYS; NO INTEREST. Subject to
Section 5.1, moneys received by the Eligible Lender Trustee hereunder shall be
deposited in the Certificate Distribution Account and invested in Eligible
Investments in accordance with instructions received from the Administrator.
The Eligible Lender Trustee shall not be liable for any interest thereon.
SECTION 5.4. ACCOUNTING AND REPORTS TO THE NOTEHOLDERS,
CERTIFICATEHOLDERS, THE INTERNAL REVENUE SERVICE AND OTHERS. The Administrator,
on behalf of the Eligible Lender Trustee, shall (a) maintain (or cause to be
maintained) the books of the Trust on a calendar year basis on the accrual
method of accounting, (b) deliver to each Certificateholder (and to each Person
who was a Certificateholder at any time during
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the applicable calendar year), as may be required by the Code and applicable
Treasury Regulations, such information as may be required (including Schedule
K-1) to enable each such Certificateholder to prepare its Federal and state
income tax returns, (c) file such tax returns relating to the Trust (including
a partnership information return, Internal Revenue Service Form 1065), and make
such elections as may from time to time be required or appropriate under any
applicable state or federal statute or rule or regulation thereunder so as to
maintain the Trust's characterization as a partnership for federal, state and
local income tax purposes, (d) cause such tax returns to be signed in the
manner required by law and (e) collect or cause to be collected any withholding
tax as described in and in accordance with Section 5.1(c) with respect to
income or distributions to Certificateholders. The Administrator, on behalf of
the Eligible Lender Trustee, shall elect under Section 1278 of the Code to
include in income currently any market discount that accrues with respect to
the Financed Student Loans. Neither the Eligible Lender Trustee nor the
Administrator on behalf of the Eligible Lender Trustee shall make the election
provided under Section 754 of the Code.
SECTION 5.5. SIGNATURE ON RETURNS; TAX MATTERS PARTNER. (a)
The Depositor shall sign on behalf of the Trust the tax returns of the Trust
unless otherwise required by applicable law.
(b) The Depositor shall be designated the "tax matters
partner" of the Trust pursuant to Section 6231(a)(7)(A) of the Code and
applicable Treasury Regulations.
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ARTICLE VI
AUTHORITY AND DUTIES OF ELIGIBLE LENDER TRUSTEE
SECTION 6.1. GENERAL AUTHORITY. The Eligible Lender Trustee
is authorized and directed to execute and deliver the Basic Documents to which
the Trust is to be a party and each certificate or other document attached as
an exhibit to or contemplated by the Basic Documents to which the Trust is to
be a party, in each case, in such form as the Depositor shall approve as
evidenced conclusively by the Eligible Lender Trustee's execution thereof, and,
on behalf of the Trust, to direct the Indenture Trustee to authenticate and
deliver such Notes as may from time to time be authorized by the Indenture and
any related Terms Supplement. The Eligible Lender Trustee is also authorized
and directed on behalf of the Trust (i) to acquire and hold legal title to the
Financed Student Loans and (ii) to take all actions required pursuant to
Section 4.2(c) of the Transfer and Servicing Agreement, and otherwise follow
the direction of and cooperate with the Administrator in submitting, pursuing
and collecting any claims to and with the Department and any Guarantor with
respect to any Interest Subsidy Payments, Special Allowance Payments, and any
other payments relating to the Financed Student Loans.
In addition to the foregoing, the Eligible Lender Trustee is
authorized to take all actions required of the Trust pursuant to the Basic
Documents. The Eligible Lender Trustee is further authorized from time to time
to take such action as the Administrator directs or instructs with respect to
the Basic Documents or with respect to the administration of the Trust and is
directed to take such action to the extent that the Administrator is expressly
required pursuant to the Basic Documents to cause the Eligible Lender Trustee
to act.
SECTION 6.2. GENERAL DUTIES. It shall be the duty of the
Eligible Lender Trustee to discharge (or cause to be discharged) all its
responsibilities pursuant to the terms of this Agreement and the other Basic
Documents to which the Trust is a party and to administer the Trust in the best
interests of the Certificateholders, subject to and in accordance with the
provisions of this Agreement and the other Basic Documents. Notwithstanding the
foregoing, the Eligible Lender Trustee shall be deemed to have discharged its
duties and responsibilities hereunder and under the other Basic Documents to
the extent the
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Administrator has agreed in the Administration Agreement to perform any act or
to discharge any duty of the Eligible Lender Trustee hereunder or under any
other Basic Document, and the Eligible Lender Trustee shall not be held liable
for the default or failure of the Administrator to carry out its obligations
under the Administration Agreement. Except as expressly provided in the Basic
Documents, the Eligible Lender Trustee shall have no obligation to administer,
service or collect the Financed Student Loans or to maintain, monitor or
otherwise supervise the administration, servicing or collection of the Financed
Student Loans.
SECTION 6.3. ACTION UPON INSTRUCTION. (a) The Eligible Lender
Trustee shall not be required to take any action hereunder or under any other
Basic Document if the Eligible Lender Trustee shall have reasonably determined,
or shall have been advised by counsel, that such action is likely to result in
liability on the part of the Eligible Lender Trustee or is contrary to the
terms hereof or of any other Basic Document or is otherwise contrary to law.
(b) Whenever the Eligible Lender Trustee is unable to
determine the appropriate course of action between alternative courses of
action permitted or required by the terms of this Agreement or under any other
Basic Document, the Eligible Lender Trustee shall promptly give notice (in such
form as shall be appropriate under the circumstances) to the Certificateholders
and the Administrator requesting instruction as to the course of action to be
adopted, and to the extent the Eligible Lender Trustee acts in good faith in
accordance with any written instruction received from the Administrator, the
Eligible Lender Trustee shall not be liable on account of such action to any
Person. If the Eligible Lender Trustee shall not have received appropriate
instruction within 30 days of such notice (or within such shorter period of
time as reasonably may be specified in such notice or may be necessary under
the circumstances) it may, but shall be under no duty to, take or refrain from
taking such action, not inconsistent with this Agreement or the other Basic
Documents, as it shall deem to be in the best interests of the
Certificateholders, and shall have no liability to any Person for such action
or inaction.
(c) If the Eligible Lender Trustee is unsure as to the
application of any provision of this Agreement or any other Basic Document or
any agreement entered into by the Eligible
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Lender Trustee on behalf of the Trust or any such provision is ambiguous as to
its application, or is, or appears to be, in conflict with any other applicable
provision, or if this Agreement permits any determination by the Eligible
Lender Trustee or is silent or is incomplete as to the course of action that
the Eligible Lender Trustee is required to take with respect to a particular
set of facts, the Eligible Lender Trustee may give notice (in such form as
shall be appropriate under the circumstances) to the Certificateholders
requesting instruction and, to the extent that the Eligible Lender Trustee acts
or refrains from acting in good faith in accordance with any such instruction
received from the Certificateholders, the Eligible Lender Trustee shall not be
liable, on account of such action or inaction, to any Person. If the Eligible
Lender Trustee shall not have received appropriate instruction within 30 days
of such notice (or within such shorter period of time as reasonably may be
specified in such notice or may be necessary under the circumstances) it may,
but shall be under no duty to, take or refrain from taking such action, not
inconsistent with this Agreement or the other Basic Documents or such other
agreements, as it shall deem to be in the best interests of the
Certificateholders, and shall have no liability to any Person for such action
or inaction.
SECTION 6.4. NO DUTIES EXCEPT AS SPECIFIED IN THIS AGREEMENT,
THE TRANSFER AND SERVICING AGREEMENT, ANY SUPPLEMENTAL TRANSFER AND SERVICING
AGREEMENT OR IN INSTRUCTIONS. The Eligible Lender Trustee shall not have any
duty or obligation to manage, make any payment with respect to, register,
record, sell, service, dispose of or otherwise deal with the Trust Estate, or
to otherwise take or refrain from taking any action under, or in connection
with, any document contemplated hereby to which the Eligible Lender Trustee is
a party, except as expressly provided by the terms of this Agreement, the
Transfer and Servicing Agreement, or in any document or written instruction
received by the Eligible Lender Trustee pursuant to Section 6.3; and no implied
duties or obligations shall be read into this Agreement or any other Basic
Document against the Eligible Lender Trustee. The Eligible Lender Trustee shall
have no responsibility for filing any financing or continuation statement in
any public office at any time or to otherwise perfect or maintain the
perfection of any security interest or lien granted to it hereunder or to
prepare or file any Commission filing for the Trust or to record this Agreement
or any other Basic Document. The Eligible Lender Trustee
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nevertheless agrees that it will, at its own cost and expense, promptly take
all action as may be necessary to discharge any liens on any part of the Trust
Estate that result from actions by, or claims against, The First National Bank
of Chicago in its individual capacity or as the Eligible Lender Trustee that
are not related to the ownership or the administration of the Trust Estate.
SECTION 6.5. NO ACTION EXCEPT UNDER SPECIFIED DOCUMENTS OR
INSTRUCTIONS. The Eligible Lender Trustee shall not manage, control, use, sell,
service, dispose of or otherwise deal with any part of the Trust Estate except
(i) in accordance with the powers granted to and the authority conferred upon
the Eligible Lender Trustee pursuant to this Agreement, (ii) in accordance with
the other Basic Documents to which it or the Trust is a party and (iii) in
accordance with any document or instruction delivered to the Eligible Lender
Trustee pursuant to Section 6.3.
SECTION 6.6. RESTRICTIONS. The Eligible Lender Trustee shall
not take any action (a) that is inconsistent with the purposes of the Trust set
forth in Section 2.3 or (b) that, to the actual knowledge of the Eligible
Lender Trustee, would result in the Trust's becoming taxable as a corporation
for Federal income tax purposes. The Certificateholders shall not direct the
Eligible Lender Trustee to take any action that would violate the provisions of
this Section.
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ARTICLE VII
CONCERNING THE ELIGIBLE LENDER TRUSTEE
SECTION 7.1. ACCEPTANCE OF TRUSTS AND DUTIES. The Eligible
Lender Trustee accepts the trusts hereby created and agrees to perform its
duties hereunder with respect to such trusts but only upon the terms of this
Agreement for the benefit of the Certificateholders. The Eligible Lender
Trustee also agrees to disburse all moneys actually received by it constituting
part of the Trust Estate under the terms of this Agreement and the other Basic
Documents. The Eligible Lender Trustee shall not be answerable or accountable
hereunder or under any other Basic Document under any circumstances, except (i)
for its own willful misconduct, bad faith or negligence or (ii) in the case of
the inaccuracy of any representation or warranty contained in Section 7.3
expressly made by the Eligible Lender Trustee; provided, however, that in no
event shall the Eligible Lender Trustee be liable under any theory of tort,
contract, strict liability or other legal or equitable theory for any lost
profits or exemplary, punitive, special, incidental, indirect or consequential
damages, each of which is hereby excluded by agreement of the parties
regardless of whether or not the Eligible Lender Trustee has been advised of
the possibility of such damages. In particular, but not by way of limitation
(and subject to the exceptions set forth in the preceding sentence):
(a) the Eligible Lender Trustee shall not be liable for any
error of judgment made in good faith by a responsible officer of the
Eligible Lender Trustee unless it is proved that the Eligible lender
Trustee was negligent in ascertaining the pertinent facts;
(b) the Eligible Lender Trustee shall not be liable with
respect to any action taken or omitted to be taken by it in accordance
with the direction or instructions of the Administrator, the Depositor
or the Certificateholders of Certificates evidencing the requisite
percentage of the Certificate Balance;
(c) no provision of this Agreement or any other Basic
Document shall require the Eligible Lender Trustee to expend or risk
funds or otherwise incur any financial
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liability in the performance of any of its rights or powers hereunder
or under any other Basic Document, if the Eligible Lender Trustee
shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not
reasonably assured or provided to it;
(d) under no circumstances shall the Eligible Lender Trustee
be liable for indebtedness evidenced by or arising under any of the
Basic Documents, including the principal of and interest on the Notes
or for any amounts owing under the Trust Certificates;
(e) the Eligible Lender Trustee shall not be responsible for
or in respect of the validity or sufficiency of this Agreement or for
the due execution hereof by the Depositor or for the form, character
genuineness, sufficiency, value or validity of any of the Trust Estate
or for or in respect of the validity or sufficiency of the Basic
Documents, other than the certificate of authentication on the Trust
Certificates and the Eligible Lender Trustee shall in no event assume
or incur any liability, duty or obligation to any Noteholder or to any
Certificateholder, other than as expressly provided for herein and in
the other Basic Documents;
(f) the Eligible Lender Trustee shall not be liable for the
action or inaction, default or misconduct of the Depositor,
Administrator, the Seller, the Indenture Trustee or the Master
Servicer under this Agreement or any of the other Basic Documents or
otherwise and the Eligible Lender Trustee shall have no obligation or
liability to perform the obligations of the Trust under this Agreement
or the other Basic Documents that are required to be performed by the
Administrator under the Transfer and Servicing Agreement, the
Indenture Trustee under the Indenture or any Terms Supplement or the
Master Servicer under the Transfer and Servicing Agreement; and
(g) the Eligible Lender Trustee shall be under no obligation
to exercise any of the rights or powers vested in it by this
Agreement, or to institute, conduct or defend any litigation under
this Agreement or otherwise or in relation to this Agreement or any
other Basic Document, at the request, order or direction of any of the
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Certificateholders, unless such Certificateholders have offered to the
Eligible Lender Trustee security or indemnity reasonably satisfactory
to it against the costs, expenses and liabilities that may be incurred
by the Eligible Lender Trustee therein or thereby. The right of the
Eligible Lender Trustee to perform any discretionary act enumerated in
this Agreement or in any other Basic Document shall not be construed
as a duty, and the Eligible Lender Trustee shall not be answerable for
other than its negligence, bad faith or willful misconduct in the
performance of any such act.
SECTION 7.2. FURNISHING OF DOCUMENTS. The Eligible Lender
Trustee shall furnish to the Certificateholders promptly upon receipt of a
written request therefor duplicates or copies of all reports, notices,
requests, demands, certificates, financial statements and any other instruments
furnished to the Eligible Lender Trustee under the Basic Documents.
SECTION 7.3. REPRESENTATIONS AND WARRANTIES. The Eligible
Lender Trustee hereby represents and warrants to the Depositor, for the benefit
of the Certificateholders that:
(a) It is a national banking association duly organized and
validly existing in good standing under the laws of The United States.
It has all requisite corporate power and authority to execute, deliver
and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this Agreement
has been executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement on its behalf, and
when so executed shall be a legal, valid and binding obligation of the
Eligible Lender Trustee, enforceable against the Eligible Lender
Trustee in accordance with its terms.
(c) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will, contravene any Federal or state law, governmental rule or
regulation governing the banking or trust powers of the Eligible
Lender Trustee or any judgment or order binding on it, or
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constitute any default under its charter documents or by-laws or any
indenture, mortgage, contract, agreement or instrument to which it is
a party or by which any of its properties may be bound.
(d) It is an "eligible lender", as such term is defined in
Section 435(d) of the Higher Education Act, for purposes of holding
legal title to the Financed Student Loans as contemplated by this
Agreement and the other Basic Documents has obtained a lender
identification number with respect to the Trust from the Department
and has in effect a Guarantee Agreement with each of the guarantors
with respect to the Financed Student Loans.
SECTION 7.4. RELIANCE; ADVICE OF COUNSEL. (a) The Eligible
Lender Trustee shall incur no liability to anyone in acting upon any signature,
instrument, direction, notice, resolution, request, consent, order,
certificate, report, opinion, bond, or other document or paper believed by it
to be genuine and believed by it to be signed by the proper party or parties.
As to any fact or matter the method of the determination of which is not
specifically prescribed herein, the Eligible Lender Trustee may for all
purposes hereof rely on a certificate, signed by the president or any vice
president or by the treasurer or other authorized officers of the relevant
party, as to such fact or matter and such certificate shall constitute full
protection to the Eligible Lender Trustee for any action taken or omitted to be
taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder
and in the performance of its duties and obligations under this Agreement or
the other Basic Documents, the Eligible Lender Trustee (i) may act directly or
through its agents, including the Administrator, or attorneys pursuant to
agreements entered into with any of them, and the Eligible Lender Trustee shall
not be liable for the conduct or misconduct of such agents or attorneys if such
agents or attorneys shall have been selected by the Eligible Lender Trustee
with reasonable care or by the Administrator or Depositor, and (ii) may consult
with counsel, accountants and other skilled persons to be selected with
reasonable care and employed by it or selected and employed by the
Administrator or Depositor. The Eligible Lender Trustee shall not be liable for
anything done, suffered or omitted in good faith by it in accordance with the
opinion or advice of any
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such counsel, accountants or other such persons and not contrary to this
Agreement or any other Basic Document.
SECTION 7.5. NOT ACTING IN INDIVIDUAL CAPACITY. Except for
the representations and warranties set forth in Section 7.3, in accepting the
trusts hereby created The First National Bank of Chicago acts solely as
Eligible Lender Trustee hereunder and not in its individual capacity and all
Persons having any claim against the Eligible Lender Trustee by reason of the
transactions contemplated by this Agreement or any other Basic Document shall
look only to the Trust Estate for payment or satisfaction thereof.
SECTION 7.6. ELIGIBLE LENDER TRUSTEE NOT LIABLE FOR TRUST
CERTIFICATES OR FINANCED STUDENT LOANS. The recitals contained in any Trust
Supplement and in the Trust Certificates (other than the signature and
countersignature of the Eligible Lender Trustee on the Trust Certificates)
shall be taken as the statements of the Depositor and the Eligible Lender
Trustee assumes no responsibility for the correctness thereof. The Eligible
Lender Trustee makes no representations as to the validity or sufficiency of
this Agreement, the Trust Certificates or any other Basic Document (other than
the signature and countersignature of the Eligible Lender Trustee on the Trust
Certificates) or the Notes, or of any Financed Student Loan or related
documents. Except as to a Guarantor or the U.S. Secretary of Education, the
Eligible Lender Trustee shall at no time have any responsibility or liability
(except for willfully or negligently terminating or allowing to be terminated
any of the Guarantee Agreements) for or with respect to the legality, validity,
enforceability and eligibility for Guarantee Payments of any Financed Student
Loan, or for or with respect to the sufficiency of the Trust Estate or its
ability to generate the payments to be distributed to Certificateholders under
this Agreement or the Noteholders under the Indenture, including without
limitation: the existence and contents of any computer or other record of any
Financed Student Loan; the validity of the assignment of any Financed Student
Loan to the Trust; the completeness of any Financed Student Loan; the
performance or enforcement (except as expressly set forth in any Basic
Document) of any Financed Student Loan; the compliance by the Depositor,
Administrator, Seller or the Master Servicer with any warranty or
representation made under any Basic Document or in any related document or the
accuracy of any such warranty or representation or any action or inaction of
the Depositor,
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Seller, Administrator, the Indenture Trustee or the Master Servicer or any
subservicer taken in the name of the Eligible Lender Trustee; and the failure
of the Financed Student Loans to be serviced in conformity with applicable
regulations.
Notwithstanding any provision in this Agreement or the Basic Documents, nothing
in such Agreement and Basic Documents shall be construed to limit the Eligible
Lender Trustee's responsibility to the U.S. Secretary of Education or a
Guarantor in its capacity as Eligible Lender Trustee for any violations of
statutory or regulatory requirements that may occur with respect to loans held
in the Trust, pursuant to 34 CFR 682.203(b) or any successor provision thereto.
SECTION 7.7. ELIGIBLE LENDER TRUSTEE MAY OWN TRUST
CERTIFICATES AND NOTES. The Eligible Lender Trustee in its individual or any
other capacity may become the owner or pledgee of the Trust Certificates or
Notes and may deal with the Depositor, the Administrator, the Indenture
Trustee, the Master Servicer and the Guarantors in banking or trust
transactions with the same rights as it would have if it were not Eligible
Lender Trustee, including serving as a trustee of other trusts dealing in any
student loans, including trusts which purchase student loans from the Trust.
SECTION 7.8 REPRESENTATIONS AND WARRANTEES OF DELAWARE
TRUSTEE. The Delaware Trustee hereby represents and warrants to the Depositor,
for the benefit of the Certificateholders that:
(a) It is a Delaware banking corporation duly organized and
validly existing in good standing under the laws of Delaware. It has
all requisite corporate power and authority to execute, deliver and
perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize
the execution and delivery by it of this Agreement, and this Agreement
has been executed and delivered by one of its officers who is duly
authorized to execute and deliver this Agreement on its behalf, and
when so executed shall be a legal, valid and binding obligation of the
Delaware Trustee, enforceable against the Delaware Trustee in
accordance with its terms.
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(c) Neither the execution nor the delivery by it of this
Agreement, nor the consummation by it of the transactions contemplated
hereby nor compliance by it with any of the terms or provisions hereof
will, contravene any Federal or state law, governmental rule or
regulation governing the banking or trust powers of the Delaware
Trustee or any judgment or order binding on it, or constitute any
default under its charter documents or by-laws or any indenture,
mortgage, contract, agreement or instrument to which it is a party or
by which any of its properties may be bound.
ARTICLE VIII
COMPENSATION OF ELIGIBLE LENDER TRUSTEE
SECTION 8.1. ELIGIBLE LENDER TRUSTEE'S FEES AND EXPENSES. The
Eligible Lender Trustee shall receive as compensation for its services
hereunder such fees as have been separately agreed upon before the date hereof
between the Depositor and the Eligible Lender Trustee. Such fee shall be
payable as provided in Section 5.5 of the Transfer and Servicing Agreement.
SECTION 8.2. PAYMENTS TO THE ELIGIBLE LENDER TRUSTEE. Any
amounts paid to the Eligible Lender Trustee pursuant to this Agreement or the
Transfer and Servicing Agreement shall be deemed not to be a part of the Trust
Estate immediately after such payment.
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ARTICLE IX
TERMINATION OF TRUST AGREEMENT
SECTION 9.1. TERMINATION OF TRUST AGREEMENT. (a) This Trust
shall terminate upon the earlier of (i) the final distribution by the Eligible
Lender Trustee of all moneys or other property or proceeds of the Trust Estate
in accordance with the terms of the Indenture, any related Terms Supplement,
the Transfer and Servicing Agreement, Article V hereof and any Trust
Supplement, (ii) the expiration of 21 years from the death of the last survivor
of the descendants of Xxxxxx X. Xxxxxxx, the late Ambassador of the United
States to the Court of St. Xxxxx, living on the date hereof, and (iii) the time
provided in Section 9.2. The bankruptcy, liquidation, dissolution, death or
incapacity of any Certificateholder, other than the Depositor as described in
Section 9.2, shall not (x) operate to terminate this Agreement or the Trust,
nor (y) entitle such Certificateholder's legal representatives or heirs to
claim an accounting or to take any action or proceeding in any court for a
partition or winding up of all or any part of the Trust or Trust Estate nor (z)
otherwise affect the rights, obligations and liabilities of the parties hereto.
(b) Except as provided in Section 9.1(a), neither the
Depositor nor any Certificateholder shall be entitled to revoke or terminate
the Trust without the prior written consent of the Indenture Trustee
(c) Notice of any termination of the Trust, specifying the
Distribution Date upon which the Certificateholders shall surrender their Trust
Certificates to the Certificate Paying Agent for payment of the final
distribution and cancellation, shall be given promptly by the Eligible Lender
Trustee by letter to Certificateholders mailed within five Business Days of
receipt of notice of such termination from the Administrator given pursuant to
Section 9.1(c) of the Transfer and Servicing Agreement, stating (i) the
Distribution Date upon which final payment of the Trust Certificates shall be
made upon presentation and surrender of the Trust Certificates at the office of
the Certificate Paying Agent therein designated, (ii) the amount of any such
final payment and (iii) that the Record Date otherwise applicable to such
Distribution Date is not applicable, payments being made
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only upon presentation and surrender of the Trust Certificates at the office of
the Certificate Paying Agent therein specified. The Eligible Lender Trustee
shall give such notice to the Certificate Registrar (if other than the Eligible
Lender Trustee) and the Certificate Paying Agent at the time such notice is
given to Certificateholders. Upon presentation and surrender of the Trust
Certificates the Certificate Paying Agent shall cause to be distributed to
Certificateholders amounts distributable on such Distribution Date pursuant to
Section 5.1. Certificates shall cease to earn interest as of the termination
date of the Trust.
(d) If all the Certificateholders shall not surrender their
Trust Certificates for cancellation within six months after the date specified
in the above-mentioned written notice, the Eligible Lender Trustee shall give a
second written notice to the remaining Certificateholders to surrender their
Trust Certificates for cancellation and receive the final distribution with
respect thereto. If within one year after the second notice all the Trust
Certificates shall not have been surrendered for cancellation, the Eligible
Lender Trustee may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Trust Certificates and the cost thereof shall be paid out of
the funds and other assets that shall remain subject to this Agreement. Any
funds remaining in the Trust after exhaustion of such remedies and no later
than five years after the first such notice shall be distributed by the
Eligible Lender Trustee to the Depositor.
(e) Upon termination of the Trust in accordance with Article
IX, the Eligible Lender Trustee or Delaware Trustee shall cause the Certificate
of Trust to be canceled by filing a Certificate of Cancellation with the
Delaware Secretary of State under applicable law.
SECTION 9.2. DISSOLUTION UPON INSOLVENCY OF DEPOSITOR. If an
Insolvency Event shall occur with respect to the Depositor, the Trust shall be
terminated in accordance with Section 9.1 90 days after the date of such
Insolvency Event, unless, before the end of such 90-day period, the Eligible
Lender Trustee shall have received written instructions from the Majority
Certificateholder to the effect that each such party disapproves of the
liquidation of the Financed Student Loans and termination of the Trust, in
which event the Trust shall
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continue in accordance with the Basic Documents. Promptly after the occurrence
of any Insolvency Event with respect to the Depositor (i) the Depositor shall
give the Indenture Trustee and the Eligible Lender Trustee and the Majority
Certificateholder written notice of such Insolvency Event, (ii) the Eligible
Lender Trustee shall, upon the receipt of such written notice from the
Depositor give prompt written notice to the Certificateholders and the
Indenture Trustee, of the occurrence of such event and (iii) the Indenture
Trustee shall, upon receipt of written notice of such Insolvency Event from the
Eligible Lender Trustee or the Depositor, give prompt written notice to the
Noteholders of the occurrence of such event; provided, however, that any
failure to give a notice required by this sentence shall not prevent or delay,
in any manner, a termination of the Trust pursuant to the first sentence of
this Section 9.2. Upon a termination pursuant to this Section 9.2, the
Eligible Lender Trustee shall direct the Indenture Trustee promptly to sell the
assets of the Trust (other than the Trust Accounts) in a commercially
reasonable manner and on commercially reasonable terms. The proceeds of such a
sale of the assets of the Trust shall be treated as collections under the
Transfer and Servicing Agreement.
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ARTICLE X
SUCCESSOR ELIGIBLE LENDER TRUSTEES AND
ADDITIONAL ELIGIBLE LENDER TRUSTEES
SECTION 10.1. ELIGIBILITY REQUIREMENTS FOR ELIGIBLE LENDER
TRUSTEE. The Eligible Lender Trustee shall at all times be a corporation or
association (i) qualifying as an "eligible lender" as such term is defined in
Section 435(d) of the Higher Education Act for purposes of holding legal title
to the Financed Student Loans on behalf of the Trust, with a valid lender
identification number with respect to the Trust from the Department; (ii) being
authorized to exercise corporate trust powers and hold legal title to the
Financed Student Loans; (iii) having in effect Guarantee Agreements with each
of the Guaranty Agencies then guaranteeing Financed Student Loans; (iv) having
a combined capital and surplus of at least $50,000,000 and being subject to
supervision or examination by Federal or state authorities; and (v), with
respect to any successor Eligible Lender Trustees, having (or having a parent
which has) a rating of at least Baa3 by Xxxxx'x and at least BBB by Standard &
Poor's. If the Eligible Lender Trustee shall publish reports of condition at
least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purpose of this Section 10.1,
the combined capital and surplus of the Eligible Lender Trustee shall be deemed
to be its combined capital and surplus as set forth in its most recent report
of condition so published. In case at any time the Eligible Lender Trustee
shall cease to be eligible in accordance with the provisions of this Section
10.1, the Eligible Lender Trustee shall resign immediately in the manner and
with the effect specified in Section 10.2.
SECTION 10.2. RESIGNATION OR REMOVAL OF ELIGIBLE LENDER
TRUSTEE. The Eligible Lender Trustee may at any time resign and be discharged
from the trusts hereby created by giving written notice thereof to the
Administrator and the Administrator may dismiss the Eligible Lender Trustee or
any co-paying agent at any time for its failure to act in accordance with the
terms of this Agreement; provided, however, that prior to any such dismissal,
the Administrator shall have given the Eligible Lender Trustee or the co-paying
agent, as the case may be, notice identifying such failure, and shall have
given the
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Eligible Lender Trustee or the co-paying agent, as the case may be, two
Business Days to cure such failure, if such failure relates to the distribution
of funds to Certificateholders, and 30 days to cure all other failures. Upon
receiving such notice of resignation or dismissal, the Majority
Certificateholder with notice to the Administrator shall promptly appoint a
successor Eligible Lender Trustee meeting the eligibility requirements of
Section 10.1 by written instrument, in duplicate, one copy of which instrument
shall be delivered to the resigning Eligible Lender Trustee and one copy to the
successor Eligible Lender Trustee. If no successor Eligible Lender Trustee
shall have been so appointed and have accepted appointment within 30 days after
the giving of such notice of resignation or dismissal, the resigning or
dismissed Eligible Lender Trustee, as the case may be, may petition any court
of competent jurisdiction for the appointment of a successor Eligible Lender
Trustee; provided, however, that such right to appoint or to petition for the
appointment of any such successor shall in no event relieve the resigning or
dismissed Eligible Lender Trustee, as the case may be, from any obligations
otherwise imposed on it under the Basic Documents until such successor has in
fact assumed such appointment.
If at any time the Eligible Lender Trustee shall cease to be
eligible in accordance with the provisions of Section 10.1 and shall fail to
resign after written request therefor by the Administrator, or if at any time
an Insolvency Event with respect to the Eligible Lender Trustee shall have
occurred and be continuing, then the Administrator may remove the Eligible
Lender Trustee. If the Administrator shall remove the Eligible Lender Trustee
under the authority of the immediately preceding sentence, the Administrator
shall promptly appoint, with the prior approval of the Majority
Certificateholder, a successor Eligible Lender Trustee by written instrument,
in duplicate, one copy of which instrument shall be delivered to the outgoing
Eligible Lender Trustee so removed and one copy to the successor Eligible
Lender Trustee and payment of all fees owed to the outgoing Eligible Lender
Trustee.
Any resignation or removal of the Eligible Lender Trustee and
appointment of a successor Eligible Lender Trustee pursuant to any of the
provisions of this Section shall not become effective until acceptance of
appointment by the successor Eligible Lender Trustee pursuant to Section 10.3
and payment of all fees and expenses owed to the outgoing Eligible
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Lender Trustee. The Administrator shall provide notice of such resignation or
removal of the Eligible Lender Trustee to the Majority Certificateholder.
Certificateholders and ,if any Notes or Certificates are then rated by any of
the Rating Agencies, the Rating Agencies.
SECTION 10.3. SUCCESSOR ELIGIBLE LENDER TRUSTEE. Any
successor Eligible Lender Trustee appointed pursuant to Section 10.2 shall
execute, acknowledge and deliver to the Administrator and to its predecessor
Eligible Lender Trustee an instrument accepting such appointment under this
Agreement, and thereupon the resignation or removal of the predecessor Eligible
Lender Trustee shall become effective and such successor Eligible Lender
Trustee, without any further act, deed or conveyance, shall become fully vested
with all the rights, powers, duties, and obligations of its predecessor under
this Agreement, with like effect as if originally named as Eligible Lender
Trustee. The predecessor Eligible Lender Trustee shall upon payment of its
fees and expenses deliver to the successor Eligible Lender Trustee all
documents, statements, moneys and properties held by it under this Agreement
and shall assign, if permissible, to the successor Eligible Lender Trustee the
lender identification number obtained from the Department on behalf of the
Trust; and the Administrator and the predecessor Eligible Lender Trustee shall
execute and deliver such instruments and do such other things as may reasonably
be required for fully and certainly vesting and confirming in the successor
Eligible Lender Trustee all such rights, powers, duties and obligations.
No successor Eligible Lender Trustee shall accept appointment
as provided in this Section 10.3 unless at the time of such acceptance such
successor Eligible Lender Trustee shall be eligible pursuant to Section 10.1
and shall have made the representations and warranties set forth in Section 7.3
to the Depositor, for the benefit of the Certificateholders.
Upon acceptance of appointment by a successor Eligible Lender
Trustee pursuant to this Section, the Administrator shall mail notice of the
successor of such Eligible Lender Trustee to all Certificateholders, the
Indenture Trustee the Noteholders. If the Administrator shall fail to mail such
notice within 10 days after acceptance of appointment by the successor Eligible
Lender Trustee, the successor Eligible Lender Trustee shall cause such notice
to be mailed at the expense of the Administrator.
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SECTION 10.4. MERGER OR CONSOLIDATION OF ELIGIBLE LENDER
TRUSTEE. Any corporation into which the Eligible Lender Trustee may be merged
or converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Eligible Lender
Trustee shall be a party, or any corporation succeeding to all or substantially
all the corporate trust business of the Eligible Lender Trustee, shall, without
the execution or filing of any instrument or any further act on the part of any
of the parties hereto, anything herein to the contrary notwithstanding, be the
successor of the Eligible Lender Trustee hereunder; provided that such
corporation shall be eligible pursuant to Section 10.1; provided further that
the Eligible Lender Trustee shall mail notice of such merger or consolidation
to the Depositor.
SECTION 10.5. APPOINTMENT OF CO-ELIGIBLE LENDER TRUSTEE OR
SEPARATE ELIGIBLE LENDER TRUSTEE. Notwithstanding any other provisions of this
Agreement, at any time, for the purpose of meeting any legal requirements of
any jurisdiction in which any part of the Trust may at the time be located, the
Administrator and the Eligible Lender Trustee acting jointly shall have the
power and shall execute and deliver all instruments to appoint one or more
Persons approved by the Eligible Lender Trustee, the Majority
Certificateholder, and if the Notes or the Certificates are then rated by any
of the Rating Agencies, the Rating Agencies, meeting the eligibility
requirements of clauses (i) through (iii) of Section 10.1, to act as
co-trustee, jointly with the Eligible Lender Trustee, or separate trustee or
separate trustees, of all or any part of the Trust Estate, and to vest in such
Person, in such capacity, such title to the Trust Estate, or any part thereof,
and, subject to the other provisions of this Section, such powers, duties,
obligations, rights and trusts as the Administrator and the Eligible Lender
Trustee may consider necessary or desirable. If the Administrator shall not
have joined in such appointment within 15 days after the receipt by it of a
request so to do, the Eligible Lender Trustee alone shall have the power to
make such appointment. No co-trustee or separate trustee under this Agreement
shall be required to meet the terms of eligibility as a successor trustee
pursuant to clauses (iv), (v) and (vi) of Section 10.1 and no notice of the
appointment of any co-trustee or separate trustee shall be required pursuant to
Section 10.3. The expenses incurred in connection with the retention of any
co-trustee shall be deemed an Expense of the Issuer to be borne by the
Depositor.
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Each separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Eligible Lender Trustee shall be conferred upon and
exercised or performed by the Eligible Lender Trustee and such
separate trustee or co-trustee jointly (it being understood that such
separate trustee or co-trustee is not authorized to act separately
without the Eligible Lender Trustee joining in such act), except to
the extent that under any law of any jurisdiction in which any
particular act or acts are to be performed, the Eligible Lender
Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties, and obligations
(including the holding of title to the Trust or any portion thereof in
any such jurisdiction) shall be exercised and performed singly by such
separate trustee or co-trustee, solely at the direction of the
Eligible Lender Trustee;
(ii) no trustee under this Agreement shall be personally
liable by reason of any act or omission of any other trustee under
this Agreement; and
(iii) the Administrator and the Eligible Lender Trustee acting
jointly may at any time accept the resignation of or remove any
separate trustee or co-trustee.
Any notice, request or other writing given to the Eligible
Lender Trustee shall be deemed to have been given to each of the then separate
trustees and co-trustees, as effectively as if given to each of them. Every
instrument appointing any separate trustee or co-trustee shall refer to this
Agreement and the conditions of this Article. Each separate trustee and
co-trustee, upon its acceptance of the trusts conferred, shall be vested with
the estates or property specified in its instrument of appointment, either
jointly with the Eligible Lender Trustee or separately, as may be provided
therein, subject to all the provisions of this Agreement, specifically
including every provision of this Agreement relating to the conduct of,
affecting the liability of, or
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affording protection to, the Eligible Lender Trustee. Each such instrument
shall be filed with the Eligible Lender Trustee and a copy thereof given to the
Administrator.
Any separate trustee or co-trustee may at any time appoint
the Eligible Lender Trustee as its agent or attorney-in-fact with full power
and authority, to the extent not prohibited by law, to do any lawful act under
or in respect of this Agreement on its behalf and in its name. If any separate
trustee or co-trustees shall die, become incapable of acting, resign or be
removed, all its estates, properties, rights, remedies and trusts shall vest in
and be exercised by the Eligible Lender Trustee, to the extent permitted by
law, without the appointment of a new or successor trustee.
ARTICLE XI
MISCELLANEOUS
SECTION 11.1. SUPPLEMENTS AND AMENDMENTS. (a) This Agreement,
including the Exhibits, Attachments and Annexes hereto, may be amended by the
Depositor and the Eligible Lender Trustee, but without the consent of any of
the Noteholders or the other Certificateholder to cure any ambiguity, to change
the registered office of the Trust in Delaware set forth in Section 2.2 hereof,
to correct or supplement any provisions in this Agreement or for the purpose of
adding any provisions to or changing in any manner or eliminating any of the
provisions in this Agreement or of modifying in any manner the rights of the
Noteholders, or the Certificateholders; provided, however, that such action
shall not, as evidenced by an Opinion of Counsel, adversely affect in any
material respect the interests of any Noteholder or Certificateholder.
(b) Subject to the last sentence of Section 2.3, this
Agreement may also be amended from time to time by the Depositor and the
Eligible Lender Trustee, with the consent of (i) the Noteholders of Notes
evidencing not less than 50.1% of the Outstanding Amount of the Notes, and (ii)
the Majority Certificateholders for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement
or of modifying in any manner the rights of the Noteholders or the
Certificateholders; provided, however, that no such amendment shall (a)
increase or reduce in any
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manner the amount of, or accelerate or delay the timing of, collections of
payments on Financed Student Loans or distributions that shall be required to
be made for the benefit of the Noteholders or the Certificateholders, (b)
reduce the aforesaid percentage of the Outstanding Amount of the Notes and the
Certificate Balance of Trust Certificates required to consent to any such
amendment, without the consent of all the outstanding Noteholders and
Certificateholders or (c) modify Section 2.7 (or any other Sections without an
Opinion of Counsel that such amendment will not cause the Trust to be taxed as
a corporation).
Promptly after the execution of any such amendment or
consent, the Eligible Lender Trustee shall furnish written notification of the
substance of such amendment or consent to each Certificateholder and, if the
Notes or Certificates are then rated by any Rating Agency, the Rating Agencies.
It shall not be necessary for the consent of
Certificateholders, the Noteholders or the Indenture Trustee pursuant to this
Section to approve the particular form of any proposed amendment or consent,
but it shall be sufficient if such consent shall approve the substance thereof.
The manner of obtaining such consents (and any other consents of
Certificateholders provided for in this Agreement or in any other Basic
Document) and of evidencing the authorization of the execution thereof by
Certificateholders shall be subject to such reasonable requirements as the
Eligible Lender Trustee may prescribe.
(c) Prior to the execution of any amendment to this
Agreement, the Eligible Lender Trustee shall be entitled to receive and rely
upon an Opinion of Counsel stating that the execution of such amendment is
authorized or permitted by this Agreement. The Eligible Lender Trustee may, but
shall not be obligated to, enter into any such amendment which affects the
Eligible Lender Trustee's own rights, duties or immunities under this Agreement
or otherwise.
(d) Notwithstanding anything to the contrary contained in
this Section 11.1, or elsewhere in this Agreement, the Depositor and the
Eligible Lender Trustee (upon written direction from the Depositor), at any
time and from time to time, may enter into one or more Trust Supplements to set
forth the terms of any Class of Trust Certificates that have not theretofore
been authorized by a Trust Supplement.
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SECTION 11.2. NO LEGAL TITLE TO TRUST ESTATE IN
CERTIFICATEHOLDERS. The Certificateholders shall not have legal title to any
part of the Trust Estate. The Certificateholders shall be entitled to receive
distributions with respect to their undivided beneficial ownership interest
therein only in accordance with Articles V and IX. No transfer, by operation of
law or otherwise, of any right, title, or interest of the Certificateholders to
and in their beneficial ownership interest in the Trust Estate shall operate to
terminate this Agreement or the trusts hereunder or entitle any transferee to
an accounting or to the transfer to it of legal title to any part of the Trust
Estate.
SECTION 11.3. LIMITATIONS ON RIGHTS OF OTHERS. The provisions
of this Agreement are solely for the benefit of the Eligible Lender Trustee,
the Depositor, the Certificateholders, the Administrator and, to the extent
expressly provided herein, the Indenture Trustee and the Noteholders, and
nothing in this Agreement, whether express or implied, shall be construed to
give to any other Person any legal or equitable right, remedy or claim in the
Trust Estate or under or in respect of this Agreement or any covenants,
conditions or provisions contained herein.
SECTION 11.4. NOTICES. (a) Unless otherwise expressly
specified or permitted by the terms hereof, all notices shall be in writing and
shall be deemed given upon receipt by the intended recipient or three Business
Days after mailing if mailed by certified mail, postage prepaid (except that
notice to the Eligible Lender Trustee shall be deemed given only upon actual
receipt by the Eligible Lender Trustee), if to the Eligible Lender Trustee, to
The First National Bank of Chicago, addressed to its Corporate Trust Office at
One First National Plaza, Suite 0126; Xxxxxxx, Xxxxxxxx 00000; if to the
Depositor, to PNC Bank, National Association, addressed to 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.; Senior Vice President and
General Counsel, or, as to each party, at such other address or facsimile
number as shall be designated by such party in a written notice to each other
party.
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(b) Any notice required or permitted to be given to a
Certificateholder shall be given (i) by first-class mail, postage prepaid, at
the address of such Certificateholder as shown in the Certificate Register, or
(ii) by facsimile if the Certificate Register contains a facsimile number for
such Certificateholder. Any notice so mailed or sent by facsimile within the
time prescribed in this Agreement shall be conclusively presumed to have been
duly given, whether or not the Certificateholder receives such notice.
SECTION 11.5. SEVERABILITY. Any provision of this Agreement
that is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.
SECTION 11.6. SEPARATE COUNTERPARTS. This Agreement may be
executed by the parties hereto in separate counterparts, each of which when so
executed and delivered shall be an original, but all such counterparts shall
together constitute but one and the same instrument.
SECTION 11.7. SUCCESSORS AND ASSIGNS. All covenants and
agreements contained herein shall be binding upon, and inure to the benefit of,
the Depositor and its successors, the Eligible Lender Trustee and its
successors, each Certificateholder and its successors and permitted assigns,
all as herein provided. Any request, notice, direction, consent, waiver or
other instrument or action by a Certificateholder shall bind the successors and
assigns of such Certificateholder.
SECTION 11.8. NO PETITION. (a) Prior to the date which is one
year and a day after the termination of the Trust pursuant to Section 9.1, the
Depositor will not institute against the Trust any bankruptcy proceedings under
any United States Federal or State bankruptcy or similar law in connection with
any obligations relating to the Trust Certificates, the Notes, this Agreement
or any of the other Basic Documents.
(b) The Eligible Lender Trustee (not in its individual
capacity but solely as Eligible Lender Trustee), by entering into this
Agreement, and each Certificateholder, by
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48
accepting a Trust Certificate hereby covenant and agree that they will not at
any time institute against the Depositor or the Trust, or join in any
institution against the Depositor or the Trust of, any bankruptcy,
reorganization, arrangement, insolvency, receivership or liquidation
proceedings, or other proceedings under any United States Federal or State
bankruptcy or similar law in connection with any obligations relating to the
Trust Certificates the Notes, this Agreement or any of the other Basic
Documents.
SECTION 11.9. NO RECOURSE. Each Certificateholder by
accepting a Trust Certificate acknowledges that such Certificateholder's Trust
Certificates represent beneficial interests in the Trust only and do not
represent interests in or obligations of the Depositor, the Seller, the Master
Servicer, the Administrator, the Eligible Lender Trustee, the Indenture Trustee
or any Affiliate thereof or any officer, director or employee of any thereof
and no recourse may be had against such parties or their assets, except as may
be expressly set forth in this Agreement, the Trust Certificates or the other
Basic Documents.
SECTION 11.10. HEADINGS. The headings of the various
Articles and Sections herein are for convenience of reference only and shall
not define or limit any of the terms or provisions hereof.
SECTION 11.11. GOVERNING LAW. This Agreement shall be
construed in accordance with the laws of the State of Delaware, without
reference to its conflict of law provisions, and the obligations, rights and
remedies of the parties hereunder shall be determined in accordance with such
laws. The Trust created by this Agreement shall be a business trust subject to
Delaware law.
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49
IN WITNESS WHEREOF, the parties hereto have caused this Trust
Agreement to be duly executed by their respective officers hereunto duly
authorized, as of the day and year first above written.
THE FIRST NATIONAL BANK OF CHICAGO, as
Eligible Lender Trustee
By: /S/ XXXXXXX X. XXXXXX
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Assistant Vice
President
FIRST CHICAGO DELAWARE INC., as
Delaware Trustee
By: /S/ XXXX X. XXXXXXXXXXX
--------------------------------
Name: Xxxx X. Xxxxxxxxxxx
Title: Vice President
PNC BANK, NATIONAL ASSOCIATION, as
Depositor,
By: /S/ XXXXX X. XXXXXX
--------------------------------
Name:
Title:
-00-
00
XXXXX XX XXX XXXX )
)SS:
COUNTY OF NEW YORK )
On this, the 27th day of March, 1997, before me, the
undersigned officer, personally appeared Xxxxxxx X. Xxxxxx, who acknowledged
himself to be an Assistant Vice President of The First National Bank of
Chicago, and that he as such, being authorized to do so, executed the foregoing
for the purpose of creating PNC Student Loan Trust 1997-I with The First
National Bank of Chicago, as Eligible Lender Trustee, in accordance with the
terms of the foregoing instrument, by signing the name of the corporation by
himself as Assistant Vice President.
IN WITNESS WHEREOF, I hereunto set my hand and official seal.
/S/ XXXXX X. XXXXX
------------------------
Notary Public
(SEAL)
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51
EXHIBIT A
TO THE TRUST AGREEMENT
FORM OF TRUST CERTIFICATE
SEE REVERSE FOR CERTAIN DEFINITIONS
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT") OR ANY STATE SECURITIES LAWS. THE HOLDER HEREOF,
BY PURCHASING THIS TRUST CERTIFICATE, AGREES THAT THIS TRUST CERTIFICATE MAY BE
RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY IN ACCORDANCE WITH ANY APPLICABLE
STATE SECURITIES LAWS AND (1) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS
AN INSTITUTIONAL ACCREDITED INVESTOR WITHIN THE MEANING OF RULE 501(A)(1)-(3)
UNDER THE ACT THAT PURCHASES FOR ITS OWN ACCOUNT, OR (2) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT.
THIS TRUST CERTIFICATE MAY NOT BE TRANSFERRED DIRECTLY OR INDIRECTLY
TO (1) EMPLOYEE BENEFIT PLANS, RETIREMENT ARRANGEMENTS, INDIVIDUAL RETIREMENT
ACCOUNTS OR XXXXX PLANS SUBJECT TO EITHER TITLE I OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED, OR SECTION 4975 OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED, OR (2) ENTITIES (INCLUDING INSURANCE COMPANY
GENERAL ACCOUNTS) WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF ANY
SUCH PLAN'S ARRANGEMENTS OR ACCOUNT'S INVESTMENT IN SUCH ENTITIES. FURTHER,
THIS TRUST CERTIFICATE MAY BE TRANSFERRED ONLY TO A UNITED STATES PERSON WITHIN
THE MEANING OF SECTION 7701(A)(30) OF THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED.
THIS TRUST CERTIFICATE DOES NOT REPRESENT DEPOSITS OR OBLIGATIONS OF OR
AN INTEREST IN PNC BANK, NATIONAL ASSOCIATION, THE FIRST NATIONAL BANK OF
CHICAGO OR FIRST CHICAGO DELAWARE INC.
THIS TRUST CERTIFICATE IS NOT GUARANTEED OR INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENTAL AGENCY.
AS LONG AS THE SERIES 1997-I NOTES ARE OUTSTANDING, THIS TRUST
CERTIFICATE MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT THE PRIOR
WRITTEN CONSENT OF XXXXX XXXXXX MORTGAGE CAPITAL GROUP, INC., WHICH SHALL NOT
BE UNREASONABLY WITHHELD.
A-1
52
Original Denomination:
Principal Balance:
PNC STUDENT LOAN TRUST I
ASSET BACKED CERTIFICATES
evidencing a fractional undivided interest in the Trust, as defined
below, the property of which includes a pool of student loans sold to
the Trust by PNC Bank, National Association (the "Seller").
THIS CERTIFIES THAT is the registered owner of
a dollars non-assessable, fully-paid, fractional undivided
interest in the PNC Student Loan Trust I (the "Trust"), a business trust formed
under the laws of Delaware by PNC Bank, National Association (the "Depositor").
The Trust was created pursuant to a Trust Agreement dated as of March 27, 1997
(the "Trust Agreement") between the Depositor and The First National Bank of
Chicago, as eligible lender trustee (the "Eligible Lender Trustee"), a summary
of certain of the pertinent provisions of which is set forth below. To the
extent not otherwise defined herein, the capitalized terms used herein have the
meanings assigned to them in Appendix A to the Trust Agreement; such Appendix A
also contains rules as to usage that shall be applicable herein.
This Certificate is one of the duly authorized Certificates
designated as "PNC Student Loan Trust I Asset Backed Certificates" (herein
called the "Trust Certificates"). Issued under the Master Indenture dated as of
March 27, 1997, between the Trust and Bankers Trust Company, as Indenture
Trustee, will be one or more series of notes, each series to be issued under a
separate terms agreement (such notes referred to herein as, collectively, the
"Notes"). This Trust Certificate is issued under and is subject to the terms,
provisions and conditions of the Trust Agreement, to which Trust Agreement the
holder of this Trust Certificate by virtue of the acceptance hereof assents and
by which such holder is bound. The property of the Trust includes a pool of
student loans (the "Financed
X-0
00
Xxxxxxx Xxxxx"), all moneys paid thereunder on or after the Cut-off Date
certain bank accounts and the proceeds thereof and certain other rights under
the Trust Agreement and the Transfer and Servicing Agreement and all proceeds
of the foregoing. The rights of the holders of the Trust Certificates to the
assets of the Trust are subordinated to the rights of the holders of the Notes,
as set forth in the Transfer and Servicing Agreement.
Under the Trust Agreement, distributions will be made on the
Trust Certificates on each Distribution Date, commencing in May 1997 in the
manner set forth in the Trust Agreement and the Transfer and Servicing
Agreement.
Each holder of this Trust Certificate acknowledges and agrees
that its rights to receive distributions in respect of this Trust Certificate
from Available Funds and amounts on deposit in the Reserve Account are
subordinated to the rights of the Noteholders as described in the Transfer and
Servicing Agreement and the Indenture.
Each Certificateholder, by its acceptance of a Trust
Certificate, covenants and agrees that such Certificateholder will not at any
time institute against the Depositor or the Trust, or join in any institution
against the Depositor or the Trust, any bankruptcy, reorganization,
arrangement, insolvency, receivership or liquidation proceedings, or other
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Trust Certificates, the
Notes, the Trust Agreement or any of the other Basic Documents.
Each Certificateholder, by its acceptance of a Trust
Certificate, (i) agrees, for federal, state and local income and franchise tax
purposes, to treat the Trust as a partnership, with the assets of the
partnership being the Financed Student Loans and other assets held by the
Trust, the partners of the partnership being the Certificateholders and the
Notes being debt of the partnership, and (ii) acknowledges that the Trust will
file or cause to be filed annual or other necessary returns, reports and other
forms consistent with the characterization of the Trust as a partnership for
federal, state and local and franchise tax purposes and that the Administrator
will not make, or cause to be made, an election under the provisions of
Treasury Regulation Section 301.7701.3 to classify the Trust as an association.
A-3
54
Distributions on this Trust Certificate will be made as
provided in the Trust Agreement by the Eligible Lender Trustee by wire transfer
or by check mailed to the Certificateholder of record in the Certificate
Register without the presentation or surrender of this Trust Certificate or the
making of any notation hereon.
Reference is hereby made to the further provisions of this
Trust Certificate set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place.
Unless the certificate of authentication hereon shall have
been executed by an authorized representative of the Eligible Lender Trustee or
its authenticating agent, by manual signature, this Trust Certificate shall not
entitle the holder hereof to any benefit under the Trust Agreement or the
Transfer and Servicing Agreement or be valid for any purpose.
A-4
55
IN WITNESS WHEREOF, the Eligible Lender Trustee on behalf of
the Trust and not in its individual capacity has caused this Trust Certificate
to be duly executed as of the date set forth below.
PNC STUDENT LOAN TRUST I
By: The First National Bank of Chicago,
not in its individual capacity but
solely as Eligible Lender Trustee,
By:________________________
Authorized Signatory
Date:
A-5
56
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Trust Certificates referred to in the
within-mentioned Trust Agreement.
THE FIRST NATIONAL BANK OF CHICAGO, not
in its individual capacity but
solely as Eligible Lender
Trustee,
By:___________________________
Authorized Representative
Date:
A-6
57
[Reverse of Trust Certificate]
The Trust Certificates do not represent an obligation of, or
an interest in, the Depositor, the Master Servicer, the Administrator, the
Eligible Lender Trustee or any affiliates of any of them, and no recourse may
be had against such parties or their assets, except as may be expressly set
forth herein, in the Trust Agreement or in the other Basic Documents. In
addition, this Trust Certificate is not guaranteed by any governmental agency
or instrumentality and is limited in right of payment to certain collections
respecting the Financed Student Loans, all as more specifically set forth in
the Transfer and Servicing Agreement. A copy of each of the Transfer and
Servicing Agreement and the Trust Agreement may be examined during normal
business hours at the principal office of the Depositor, and at such other
places, if any, designated by the Depositor, by any Certificateholder upon
request.
The Trust Agreement permits, with certain exceptions therein
provided, the amendment thereof and the modification of the rights and
obligations of the Transferor and the rights of the Certificateholders under
the Trust Agreement at any time by the Depositor and the Eligible Lender
Trustee with the consent of the Majority Certificateholders. Any such consent
by the holder of this Trust Certificate shall be conclusive and binding on such
holder and on all future holders of this Trust Certificate and of any Trust
Certificate issued upon the transfer hereof or in exchange herefor or in lieu
hereof whether or not notation of such consent is made upon this Trust
Certificate. The Trust Agreement also permits the amendment thereof, in certain
limited circumstances, without the consent of the holders of any of the Trust
Certificates.
As provided in the Trust Agreement and subject to certain
limitations therein set forth, the transfer of this Trust Certificate is
registerable in the Certificate Register upon surrender of this Certificate for
registration of transfer at the offices or agencies maintained by The First
National Bank of Chicago in its capacity as Certificate Registrar, or by any
successor Certificate Registrar, accompanied by a written instrument of
transfer in form satisfactory to the Eligible Lender Trustee and the
Certificate Registrar duly executed by the holder hereof or such holder's
attorney duly authorized in writing, and thereupon one or more new Trust
Certificates of authorized denominations evidencing the same aggregate interest
in the Trust will be issued to the designated transferee.
A-7
58
The Trust Certificates are issuable only as registered Trust
Certificates without coupons in minimum denominations of $1.00 and integral
multiples thereof. As provided in the Trust Agreement and subject to certain
limitations therein set forth, Trust Certificates are exchangeable for new
Trust Certificates of authorized denominations evidencing the same percentage
interest, as requested by the holder surrendering the same. No service charge
will be made for any such registration of transfer or exchange, but the
Eligible Lender Trustee or the Certificate Registrar may require payment of a
sum sufficient to cover any tax or governmental charge payable in connection
therewith.
The Eligible Lender Trustee, the Certificate Registrar and
any agent of the Eligible Lender Trustee and the Certificate Registrar may
treat the person in whose name this Trust Certificate is registered as the
owner hereof for all purposes, and none of the Eligible Lender Trustee or the
Certificate Registrar or any such agent shall be affected by any notice to the
contrary.
AS LONG AS THE SERIES 1997-I NOTES ARE OUTSTANDING, THIS TRUST CERTIFICATE MAY
NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT
OF XXXXX XXXXXX MORTGAGE CAPITAL GROUP, INC., WHICH SHALL NOT BE UNREASONABLY
WITHHELD.
This Trust Certificate may not be transferred directly or
indirectly to (1) employee benefit plans, retirement arrangements, individual
retirement accounts or Xxxxx plans subject to either Title I of the Employee
Retirement Income Security Act of 1974, as amended, or Section 4975 of the
Internal Revenue Code of 1986, as amended, or (2) entities (including insurance
company general accounts) whose underlying assets include plan assets by reason
of any such plan's arrangements or account's investment in such entities. By
accepting and holding this Trust Certificate, the Holder hereof shall be deemed
to have represented and warranted that it is not any of the foregoing entities.
This Trust Certificate may not be transferred to any person
who is not a U.S. Person, as such term is defined in Section 7701(a)(30) of the
Internal Revenue Code, as amended.
A-8
59
Each purchaser of the Trust Certificates shall be required,
prior to purchasing a Trust Certificate, to execute the Purchaser's
Representation and Warranty Letter in the form attached to the Trust Agreement
as Exhibit B.
The obligations and responsibilities created by the Trust
Agreement and the Trust created thereby shall terminate upon the payment to
Certificateholders of all amounts required to be paid to them pursuant to the
Trust Agreement and the Transfer and Servicing Agreement and the disposition of
all property held as part of the Trust. The Seller may at its option purchase
the corpus of the Trust at a price specified in the Transfer and Servicing
Agreement, and such purchase of the Financed Student Loans and other property
of the Trust will effect early retirement of the Trust Certificates; however,
such right of purchase is exercisable only as of any Distribution Date on or
after the date on which the Pool Balance is less than or equal to 5% of the
Initial Pool Balance.
This Trust Certificate shall be construed in accordance with
the laws of the State of Delaware, without reference to its conflict of law
provisions, and the obligations, rights and remedies of the parties hereunder
shall be determined in accordance with such laws.
A-9
60
ASSIGNMENT
FOR VALUE RECEIVED the undersigned hereby sells, assigns and
transfers unto
PLEASE INSERT SOCIAL SECURITY
OR OTHER IDENTIFYING NUMBER
OF ASSIGNEE
----------------------------------------------------------------
(Please print or type name and address, including postal zip code, of assignee)
----------------------------------------------------------------
the within Trust Certificate, and all rights thereunder, hereby irrevocably
constituting and appointing
_______________________________________________________ Attorney to transfer
said Trust Certificate on the books of the Certificate Registrar, with full
power of substitution in the premises.
Dated: ________________________________*
Signature Guaranteed:
________________________________*
* NOTICE: The signature to this assignment must correspond with the name as it
appears upon the face of the within Trust Certificate in every particular,
without alteration, enlargement or any change whatever. Such signature must be
guaranteed by an approved eligible guarantor institution, an institution which
is a participant in a Securities Transfer Association recognized signature
guarantee program.
A-10
61
APPENDIX A
TO THE
TRUST AGREEMENT
DEFINITIONS AND USAGE
USAGE
The following rules of construction and usage shall be
applicable to any instrument that is governed by this Appendix:
(a) All terms defined in this Appendix shall have the defined
meanings when used in any instrument governed hereby and in any certificate or
other document made or delivered pursuant thereto unless otherwise defined
therein.
(b) As used herein, in any instrument governed hereby and in
any certificate or other document made or delivered pursuant thereto,
accounting terms not defined in this Appendix or in any such instrument,
certificate or other document, and accounting terms partly defined in this
Appendix or in any such instrument, certificate or other document to the extent
not defined, shall have the respective meanings given to them under generally
accepted accounting principles as in effect on the date of such instrument. To
the extent that the definitions of accounting terms in this Appendix or in any
such instrument, certificate or other document are inconsistent with the
meanings of such terms under generally accepted accounting principles, the
definitions contained in this Appendix or in any such instrument, certificate
or other document shall control.
(c) The words "hereof", "herein", "hereunder" and words of
similar import when used in an instrument refer to such instrument as a whole
and not to any particular provision or subdivision thereof; references in an
instrument to "Article", "Section" or another subdivision or to an attachment
are, unless the context otherwise requires, to an article, section or
subdivision of or an attachment to such instrument; and the term "including"
means "including without limitation".
(d) The definitions contained in this Appendix are equally
applicable to both the singular and plural forms of such terms and to the
masculine as well as to the feminine and neuter genders of such terms.
62
(e) Any agreement, instrument or statute defined or referred
to below or in any agreement or instrument that is governed by this Appendix
means such agreement or instrument or statute as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes) by succession of comparable
successor statutes and includes (in the case of agreements or instruments)
references to all attachments thereto and instruments incorporated therein.
References to a Person are also to its permitted successors and assigns.
DEFINITIONS
"ACT" has the meaning specified in Section 11.3(a) of the
Indenture.
"ADMINISTRATION AGREEMENT" means the Administration Agreement
dated as of March 27, 1997, among the Issuer, the Indenture Trustee and the
Administrator, as amended from time to time.
"ADMINISTRATION FEE" has the meaning specified in Section 3
of the Administration Agreement.
"ADMINISTRATOR" means PNC Bank, National Association, in its
capacity as administrator of the Issuer and the Financed Student Loans, or any
successor as Administrator under the Transfer and Servicing Agreement.
"ADMINISTRATOR DEFAULT" has the meaning specified in Section
8.1(b) of the Transfer and Servicing Agreement.
"ADMINISTRATOR'S CERTIFICATE" means an Officer's Certificate
of the Administrator delivered pursuant to Section 4.7(b) of the Transfer and
Servicing Agreement, substantially in the form of Exhibit C thereto.
"AFFILIATE" means, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" when used with
respect to any
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63
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"AFSA" means the AFSA Data Corporation.
"AUTHENTICATING AGENT" means the Person appointed by the
Indenture Trustee at the request of the Issuer as Authenticating Agent for the
Notes pursuant to Section 2.3(8) of the Indenture, and any successor
Authenticating Agent for the Notes.
"AUTHORIZED OFFICER" means (i) with respect to the Issuer,
any officer of the Eligible Lender Trustee who is authorized to act for the
Eligible Lender Trustee in matters relating to the Issuer pursuant to the Basic
Documents and who is identified on the list of Authorized Officers delivered by
the Eligible Lender Trustee to the Indenture Trustee, with a copy to the
Majority Noteholder, on the Closing Date (as such list may be modified or
supplemented from time to time thereafter), (ii) with respect to the
Administrator, any officer of the Administrator who is authorized to act for
the Administrator in matters relating to itself or to the Issuer and to be
acted upon by the Administrator pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Administrator to
the Indenture Trustee, with a copy to the Majority Noteholder, on the Closing
Date (as such list may be modified or supplemented from time to time
thereafter), (iii) with respect to the Transferor, any officer of the
Transferor who is authorized to act for the Transferor in matters relating to
or to be acted upon by the Transferor pursuant to the Basic Documents and who
is identified on the list of Authorized Officers delivered by the Transferor to
the Indenture Trustee, with a copy to the Majority Noteholder, on the Closing
Date (as such list may be modified or supplemented from time to time
thereafter) and (iv) with respect to a Servicer, any officer of such Servicer
who is authorized to act for such Servicer in matters relating to or to be
acted upon by such Servicer pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by such Servicer to the
Indenture Trustee, with a copy to the Majority Noteholder, on the Closing Date
(as such list may be modified or supplemented from time to time thereafter).
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64
"AVAILABLE FUNDS" means, with respect to a Distribution Date,
the sum, without duplication, of the following amounts with respect to the
related Collection Period: (i) all collections received by the Master Servicer
or any Servicer on the Financed Student Loans (including any Guarantee Payments
received with respect to the Financed Student Loans) during such collecting
period; (ii) any payments, including without limitation Interest Subsidy
Payments and Special Allowance Payments, received by the Eligible Lender
Trustee during such Collection Period with respect to Financed Student Loans;
(iii) all proceeds from any sales of Financed Student Loans by the Trust during
such Collection Period (including but not limited to Financed Student Loans
repurchased by the Transferor or its designee or purchased by a Third Party
Purchaser pursuant to the provisions of Article X of the Transfer and Servicing
Agreement); (iv) any payments of or with respect to interest received by the
Master Servicer or a Servicer during such Collection Period with respect to a
Financed Student Loan for which a Realized Loss was previously allocated; (v)
the aggregate Purchase Amounts received for those Financed Students Loans
repurchased by the Transferor or purchased by the Master Servicer under an
obligation which arose during the related Collection Period; (vi) the aggregate
amounts, if any, received from the Transferor or the Master Servicer, as the
case may be, as reimbursement of non-guaranteed interest amounts, lost Interest
Subsidy Payments and Special Allowance Payments, with respect to the Financed
Student Loans pursuant to Section 3.2 or Section 4.5, respectively, of the
Transfer and Servicing Agreement and (vii) Investments Earnings for such
Collection Period; provided, however, that Available Funds will exclude all
payments and proceeds of any Financed Student Loans the Purchase Amount of
which has been included in Available Funds for a prior Collection Period.
"BASIC DOCUMENTS" means the Trust Agreement, the Indenture,
each Terms Supplement, the Transfer and Servicing Agreement, the Administration
Agreement, the Guarantee Agreements, the Purchase Agreement and other documents
and certificates delivered in connection with any thereof and all amendments
and supplements thereto.
"BENEFIT PLAN" means any employee benefit plan, retirement
arrangement, individual retirement account or Xxxxx Plan subject to either
Title I of ERISA or Section 4975 of the
4
65
Code, or any entity (including an insurance company general account) whose
underlying assets include plan assets by reason of a plan's investment in the
entity.
"BUSINESS DAY" means any day other than a Saturday, a Sunday
or a day on which national banking associations or banking institutions or
trust companies in New York are authorized or obligated by law, regulation or
executive order to remain closed.
"CERTIFICATE" means a certificate evidencing the beneficial
interest of a Certificateholder in the Trust, substantially in the form of
Exhibit A to the Trust Agreement.
"CERTIFICATE BALANCE" equals, initially, the Initial
Certificate Balance and, thereafter, equals the Initial Certificate Balance
reduced by all amounts previously distributed to Certificateholders as
principal. In determining whether the Certificateholders which hold
Certificates representing the requisite Certificate Balance have given any
request, demand, authorization, direction, notice, consent or waiver hereunder
or under any other Basic Document, the Certificate Balance shall not include
the principal balance of Certificates owned by the Transferor or any Affiliate
of the Transferor.
"CERTIFICATE DISTRIBUTION ACCOUNT" means the account
designated as such, established and maintained pursuant to Section 5.1 of the
Transfer and Servicing Agreement.
"CERTIFICATE MONTHLY ADVANCE ACCOUNT" means the account
designated as such, established and maintained pursuant to Section 5.1 of the
Transfer and Servicing Agreement.
"CERTIFICATE PAYING AGENT" means any paying agent or
co-paying agent appointed pursuant to Section 3.10 of the Trust Agreement,
which shall initially be the Eligible Lender Trustee.
"CERTIFICATE INITIAL RATE" means 7.1875% per annum.
"CERTIFICATE RATE" means One-Month LIBOR plus 1.50%.
"CERTIFICATE REGISTER" and "CERTIFICATE REGISTRAR" means the
register mentioned and the registrar appointed pursuant to Section 3.4 of the
Trust Agreement.
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66
"CERTIFICATEHOLDER" means a Person in whose name a
Certificate is registered in the Certificate Register.
"CERTIFICATEHOLDERS' DISTRIBUTION AMOUNT" means, with respect
to any Distribution Date, the Certificateholders' Interest Distribution Amount
for such Distribution Date plus, for each Certificate Distribution Date on and
after the Notes have been paid in full, the Certificateholders' Principal
Distribution Amount for such Distribution Date.
"CERTIFICATEHOLDERS' INTEREST CARRYOVER SHORTFALL" means,
with respect to any Distribution Date, the excess, if any, of (i) the sum of
the related Certificateholders' Interest Distribution Amount on the preceding
Certificate Distribution Date and any outstanding Certificateholders' Interest
Carryover Shortfall on such preceding Distribution Date over (ii) the amount of
interest actually distributed to such Certificateholders on such preceding
Distribution Date, plus interest on the amount of such excess interest due to
such Certificateholders, to the extent permitted by law, at the related
Certificate Rate from such preceding Distribution Date to the current
Distribution Date.
"CERTIFICATEHOLDERS' INTEREST DISTRIBUTION AMOUNT" means,
with respect to any Certificate Distribution Date, the sum of (i) the amount of
interest accrued at the Certificate Rate for the related Interest Period on the
outstanding Certificate Balance on the immediately preceding Distribution Date,
after giving effect to all distributions of principal to Certificateholders on
such Distribution Date (or, in the case of the first Distribution Date, on the
Closing Date) and (ii) the Certificateholders' Interest Carryover Shortfall for
such Distribution Date; provided, however, that the Certificateholders'
Interest Distribution Amount will not include any Certificateholders' Interest
Carryover.
"CERTIFICATEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL" means, as
of the close of any Distribution Date on or after which the Notes have been
paid in full, the excess of (i) the sum of the Certificateholders' Principal
Distribution Amount on such Distribution Date and any outstanding
Certificateholders' Principal Carryover Shortfall for the preceding
Distribution Date over (ii) the amount of principal actually distributed to the
Certificateholders on such Distribution Date.
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67
"CERTIFICATEHOLDERS' PRINCIPAL DISTRIBUTION AMOUNT" means, on
each Distribution Date on and after the date when the principal balance of each
Class of Notes has been paid in full, the sum of (a) the Principal Distribution
Amount for the Collection Period in the immediately preceding such Distribution
Date and (b) the Certificateholders' Principal Carryover Shortfall as of the
close of the preceding Distribution Date; provided, however, that the
Certificateholders' Principal Distribution Amount will in no event exceed the
outstanding principal balance of the Certificates. Further, on the Distribution
on which the principal balance of the last Outstanding Class of Notes is paid
in full, the Certificateholders' Principal Distribution Amount also will
include the excess, if any, of the amount of principal available to be
distributed on such Distribution Date over the amount of principal paid on the
Notes on such date.
"CLASS" means any class of Notes.
"CLASS INITIAL RATE" means, with respect to any Class, the
rate identified as such in the related Terms Supplement.
"CLASS INITIAL RATE ADJUSTMENT DATE" means, with respect to
any Class of Notes, May 15, 1997.
"CLASS INTEREST RATE" means, with respect to any Class, the
interest rate determined as set forth in the related Terms Supplement.
"CLOSING DATE" means March 27, 1997.
"CODE" means the Internal Revenue Code of 1986, as amended
from time to time, and Treasury Regulations promulgated thereunder.
"COLLECTION ACCOUNT" means the account designated as such,
established and maintained pursuant to Section 5.1 of the Transfer and
Servicing Agreement.
"COLLECTION PERIOD" means, with respect to the first
Distribution Date, the period beginning March 26, 1997 and ending on April 30,
1997, inclusive, and with respect to each subsequent Distribution Date
thereafter, the Collection Period means the calendar month immediately
following the end of the previous Collection Period.
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"COMMISSION" means the Securities and Exchange Commission.
"CONSOLIDATION LOAN" means a Financed Student Loan designated
as such, made by the Transferor to an eligible borrower that represents the
refinancing of student loans to such borrower and his or her spouse in
accordance with the applicable terms and provisions of the Higher Education
Act.
"CORPORATE TRUST OFFICE" means (i) with respect to the
Indenture Trustee, the principal office of the Indenture Trustee at which at
any particular time its corporate trust business shall be administered, which
office on the Closing Date is located at Four Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000 Attention: Corporate Trust and Agency Group, Structured Finance Group
(telephone: (212) 000- 0000; facsimile: (000) 000-0000) or at such other
address as the Indenture Trustee may designate from time to time by notice to
the Noteholders, the Certificateholder and the Transferor, or the principal
corporate trust office of any successor Indenture Trustee (the address of which
the successor Indenture Trustee will notify the Noteholders the Majority
Noteholder and the Transferor) and (ii) with respect to the Eligible Lender
Trustee, the principal corporate trust office of the Eligible Lender Trustee
located at Xxx Xxxxx Xxxxxxxx Xxxxx, Xxxxx 0000, Xxxxxxx, Xxxxxxxx 00000,
Attention: Xxxxxxx X. Xxxxxx telephone: (000) 000-0000; facsimile (312)
407-1708; or at such other address as the Eligible Lender Trustee may designate
by notice to the Certificateholders and the Transferor, or the principal
corporate trust office of any successor Eligible Lender Trustee (the address of
which the successor Eligible Lender Trustee will notify the Certificateholders
and the Transferor).
"CUT-OFF DATE" means, the close of business on March 25,
1997.
"DEFAULT" means any occurrence that is, or with notice or the
lapse of time or both would become, an Event of Default.
"DEFERRAL PHASE" means the period during which the related
borrower is in school and for certain authorized periods as described in the
Higher Education Act.
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"DELIVERY" when used with respect to Trust Account Property
means:
(a) with respect to bankers' acceptances, commercial paper,
negotiable certificates of deposit and other obligations that
constitute "instruments" within the meaning of Section 9-105(1)(i) of
the UCC and are susceptible of physical delivery, transfer thereof to
the Indenture Trustee or its nominee or custodian by physical delivery
to the Indenture Trustee or its nominee or custodian endorsed to, or
registered in the name of, the Indenture Trustee or its nominee or
custodian or endorsed in blank, and, with respect to a certificated
security (as defined in Section 8-102 of the UCC) transfer thereof (i)
by delivery of such certificated security endorsed to, or registered
in the name of, the Indenture Trustee or its nominee or custodian or
endorsed in blank to a financial intermediary (as defined in Section
8-313) of the UCC) and the making by such financial intermediary of
entries on its books and records identifying such certificated
securities as belonging to the Indenture Trustee or its nominee or
custodian and the sending by such financial intermediary of a
confirmation of the purchase of such certificated security by the
Indenture Trustee or its nominee or custodian, or (ii) by delivery
thereof to a "clearing corporation" (as defined in Section 8-102(3) of
the UCC) and the making by such clearing corporation of appropriate
entries on its books reducing the appropriate securities account of
the transferor and increasing the appropriate securities account of a
financial intermediary by the amount of such certificated security,
the identification by the clearing corporation of the certificated
securities for the sole and exclusive account of the financial
intermediary, the maintenance of such certificated securities by such
clearing corporation or a "custodian bank" (as defined in Section
8-102(4) of the UCC) or the nominee of either subject to the clearing
corporation's exclusive control, the sending of a confirmation by the
financial intermediary of the purchase by the Indenture Trustee or its
nominee or custodian of such securities and the making by such
financial intermediary of entries on its books and records identifying
such certificated securities as belonging to the Indenture Trustee or
its nominee or custodian (all of the foregoing, "Physical Property"),
and,
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in any event, any such Physical Property in registered form shall be
in the name of the Indenture Trustee or its nominee or custodian; and
such additional or alternative procedures as may hereafter become
appropriate to effect the complete transfer of ownership of any such
Trust Account Property to the Indenture Trustee or its nominee or
custodian, consistent with changes in applicable law or regulations or
the interpretation thereof;
(b) with respect to any securities 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 Trust Account
Property to an appropriate book-entry account maintained with a
Federal Reserve Bank by a financial intermediary which is also a
"depository" pursuant to applicable Federal regulations and issuance
by such financial intermediary of a deposit advice or other written
confirmation of such book-entry registration to the Indenture Trustee
or its nominee or custodian of the purchase by the Indenture Trustee
or its nominee or custodian of such book-entry securities; the making
by such financial 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
Indenture Trustee or its nominee or custodian and indicating that such
custodian holds such Trust Account Property solely as agent for the
Indenture Trustee or its nominee or custodian; and such additional or
alternative procedures as may hereafter become appropriate to effect
complete transfer of ownership of any such Trust Account Property to
the Indenture Trustee or its nominee or custodian, consistent with
changes in applicable law or regulations or the interpretation
thereof; and
(c) with respect to any item of Trust Account Property that
is an uncertificated security under Article 8 of the UCC and that is
not governed by clause (b) above, registration on the books and
records of the issuer thereof in the name of the financial
intermediary, the sending of a confirmation by the financial
intermediary of the purchase
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by the Indenture Trustee or its nominee or custodian of such
uncertificated security, the making by such financial intermediary of
entries on its books and records identifying such uncertificated
certificates as belonging to the Indenture Trustee or its nominee or
custodian.
"DEPARTMENT" means the United States Department of Education,
an agency of the Federal government.
"DEPOSITOR" means PNC Bank, National Association in its
capacity as Depositor under the Trust Agreement.
"DETERMINATION DATE" means, with respect to any Distribution
Date, the fifth Business Day preceding such Distribution Date.
"DISTRIBUTION" means, with respect to any Financed Student
Loan, the amount of the monthly remittance payable to the holder of such
Financed Student Loan in accordance with its terms.
"DISTRIBUTION DATE" means (i) the Business Day immediately
following the end of an Interest Period, commencing May 15, 1997 and (ii) any
day on which a deposit is made into the Collection Account pursuant to Article
X of the Transfer and Servicing Agreement.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the United States of America or any one of the States (or any domestic
branch of a foreign bank), having corporate trust powers and acting as trustee
for funds deposited in such account, so long as any of the securities of such
depository institution have a credit rating from each Rating Agency in one of
its generic rating categories which signifies investment grade.
"ELIGIBLE INSTITUTION" means an entity which is an
institution whose deposits are insured by the FDIC and the unsecured and
uncollateralized long-term debt obligations of which shall be rated "A" or
better by Standard & Poor's and A2 or better by Moody's, or one of the two
highest short-term ratings by Standard & Poor's and the highest short term
rating by Moody's, and which is either (i) a federal savings
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association duly organized, validly existing and in good standing under the
federal banking laws, (ii) an institution duly organized, validly existing and
in good standing under the applicable banking laws of any state, (iii) a
national banking association duly organized, validly existing and in good
standing under the federal banking laws, or (iv) a principal subsidiary of a
bank holding company.
"ELIGIBLE INVESTMENTS" As used herein, Eligible Investments
shall include the following:
(1) Cash (insured at all times by the Federal Deposit Insurance
Corporation);
(2) Direct obligations of (including obligations issued or held
in book entry form on the books of) the Department of the
Treasury of the United States of America;
(3) obligations of any of the following federal agencies which
obligations represent the full faith and credit of the United
States of America, including:
- Export-Import Bank
- Farm Credit System Financial Assistance Corporation
- Farmers Home Administration
- General Services Administration
- U.S. Maritime Administration
- Small Business Administration
- Government National Mortgage Association (GNMA)
- U.S. Department of Housing & Urban Development (PHA's)
- Federal Housing Administration;
(4) senior debt obligations rated "AAA" by Standard & Poor's and
"Aaa" by Moody's issued by the Federal National Mortgage
Association or the Federal Home Loan Mortgage Corporation
(5) U.S. dollar denominated deposit accounts, federal funds and
banker's acceptances with domestic commercial banks which
have a rating on their short term certificates of deposit on
the date of purchase of "A-1" or "A-1+" by Standard & Poor's
and "P-1" by
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Moody's and maturing no more than 360 days after the date of
purchase (ratings on holding companies not being considered
the rating of the bank);
(6) commercial paper which is rated at the time of purchase in
the single highest classification, "A-1+" by Standard &
Poor's and "P-1" by Moody's and which matures not more than
270 days after the date of purchase;
(7) Investments in money market funds (including, but not limited
to, money market mutual funds) rated "AAAm" or "AAAm-G" or
better by Standard & Poor's;
(8) Pre-refunded Municipal Obligations defined as follows: Any
bonds or other obligations of any state of the United States
of America or of any agency, instrumentality or local
governmental unit of any such state which are not callable at
the option of the obligor prior to maturity or as to which
irrevocable instructions have been given by the obligor to
call on the date specified in the notice; and
(A) which are rated, based on an irrevocable escrow
account or fund (the "escrow"), in the highest
rating category of Standard & Poor's and Moody's or
any successors thereto; or
(B) (i) which are fully secured as to principal and
interest and redemption premium, if any, by an
escrow consisting only of cash or obligations
described in paragraph (2) above, which escrow may
be applied only to the payment of such principal of
and interest and redemption premium, if any, on such
bonds or other obligations on the maturity date or
dates thereof or the specified redemption date or
dates pursuant to such irrevocable instructions, as
appropriate, and (ii) which escrow is sufficient, as
verified by a nationally recognized independent
certified public accountant, to pay principal of and
interest and redemption premium, if any, on the
bonds or other obligations described in this
paragraph on the maturity date or dates specified in
the irrevocable instructions referred to above, as
appropriate;
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(9) investment agreements approved in writing by the Majority
Noteholder; and
(10) other forms of investments (including repurchase agreements)
approved in writing by the Majority Noteholder.
Notwithstanding anything in this Agreement or the Basic Documents to
the contrary, for so long as the Transferor is a Certificateholder, all
investments of the Trust shall be made in investments permissible for a
national bank.
The value of the above investments shall be determined as follows:
a) as to investments the bid and asked prices of which are
published on a regular basis in The Wall Street Journal (or,
if not there, then in The New York Times): the average of the
bid and asked prices for such investments so published on or
most recently prior to such time of determination;
b) as to investments the bid and asked prices of which are not
published on a regular basis in The Wall Street Journal or
The New York Times: the average bid price at such time of
determination for such investments by any two nationally
recognized government securities dealers (selected by the
Indenture Trustee in its absolute discretion) at the time
making a market in such investments or the bid price
published by a nationally recognized pricing service;
c) as to certificates of deposit and bankers acceptances: the
face amount thereof, plus accrued interest; and
d) as to any investment not specified above: the value thereof
established by prior agreement between the Issuer, the
Administrator, the Indenture Trustee and the Majority
Noteholder.
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"ELIGIBLE LENDER TRUSTEE" means The First National Bank of
Chicago not in its individual capacity but solely as Eligible Lender Trustee
under the Trust Agreement.
"ELIGIBLE LENDER TRUSTEE FEE" has the meaning specified in
Section 8.1 of the Trust Agreement.
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
"EVENT OF DEFAULT" has the meaning specified in Section 5.1
of the Indenture.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"EXECUTIVE OFFICER" means, with respect to any corporation,
the Chief Executive Officer, Chief Operating Officer, Chief Financial Officer,
President, any Executive Vice President, any Senior Vice President, any Vice
President, the Secretary, the Controller or the Treasurer of such corporation;
and with respect to any partnership, any general partner thereof.
"EXPENSE ACCOUNT" means the account designated as such
pursuant to Section 5.1 of the Transfer and Servicing Agreement.
"EXPENSES" means any and all liabilities, obligations,
losses, damages, taxes, claims, actions and suits, and any and all reasonable
costs, expenses and disbursements (including reasonable legal fees and
expenses) of any kind and nature whatsoever which may at any time be imposed
on, incurred by, or asserted against the Eligible Lender Trustee or any of its
officers, directors or agents in any way relating to or arising out of the
Trust Agreement, the other Basic Documents, the Trust Estate, the
administration of the Trust Estate or the action or inaction of the Eligible
Lender Trustee under the Trust Agreement or the other Basic Documents.
"FDIC" means the Federal Deposit Insurance Corporation.
"FEDERAL FUNDS RATE" means, for any date of determination,
the Federal funds (effective) rate as published on page 118 of the Dow Xxxxx
Telerate Service (or such other
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page as may replace that page on that service for the purpose of displaying
comparable rates or prices) on the immediately preceding Business Day. If no
such rate is published on such page on such day, "Federal Funds Rate" shall
mean for any date of determination, the Federal funds (effective) rate as
published by the Federal Reserve Board in the most recent edition of Federal
Reserve Statistical Release No. H.15 (519) that is available on the Business
Day immediately preceding such date.
"FEDERAL LOAN" means a Financed Student Loan which is a PLUS
Loan, SLS Loan, Consolidation Loan, Xxxxxxxx Loan or Unsubsidized Xxxxxxxx
Loan.
"FHLMC" means Federal Home Loan Mortgage Corporation, a
corporate instrumentality of the United States created and existing under Title
III of the Emergency Home Finance Act of 1970, as amended, or any successor
thereto.
"FINAL MATURITY DATE" means, with respect to any Note, the
date on which the entire unpaid principal amount of such Note becomes due and
payable as provided in the related Terms Supplement or Trust Agreement,
respectively.
"FINANCED STUDENT LOAN" means the Federal Loans set forth in
Schedule A to the Transfer and Servicing Agreement, as amended from time to
time by the Issuer to accurately reflect the Financed Student Loans then
subject to the Lien of the Indenture. The Schedule of Financed Student Loans
may be in the form of microfiche or other form of electronic media.
"FINANCED STUDENT LOAN FILES" means the documents specified
in Section 3.3 of the Transfer and Servicing Agreement.
"FNMA" means Federal National Mortgage Association, a
federally chartered and privately owned corporation organized and existing
under the Federal National Mortgage Association Charter Act, or any successor
thereto.
"GRACE PERIOD" means certain grace periods authorized by the
Higher Education Act during which the related borrower's scheduled payments are
deferred.
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"GRANT" means mortgage, pledge, bargain, sell, warrant,
alienate, remise, release, convey, assign, transfer, create, and xxxxx x xxxx
upon and a security interest in and right of set-off against, deposit, set over
and confirm pursuant to the Indenture. A Grant of the Trust Estate or of any
other agreement or instrument shall include all rights, powers and options (but
none of the obligations) of the Granting party thereunder, including the
immediate and continuing right to claim for, collect, receive and give receipt
for principal and interest payments in respect of the Trust Estate and all
other moneys payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights and
options, to bring Proceedings in the name of the Granting party or otherwise
and generally to do and receive anything that the Granting party is or may be
entitled to do or receive thereunder or with respect thereto.
"GREAT LAKES" means Great Lakes Higher Education Corporation.
"GUARANTEE AGREEMENTS" means each agreement entered into
between the Eligible Lender Trustee and a Guarantor pursuant to which such
Guarantor guarantees payments on Financed Student Loans.
"GUARANTEE PAYMENT" means any payment made by a Guaranty
Agency pursuant to a Guarantee Agreement in respect of a Financed Student Loan.
"GUARANTOR" means each Guaranty Agency that enters into a
Guarantee Agreement with the Eligible Lender Trustee pursuant to which such
Guaranty Agency guarantees payments on Financed Student Loans. "Guarantor"
includes the Department when it performs as a successor to an insolvent or
defunct Guarantor for purposes of making Guarantee Payments.
"GUARANTY AGENCY" means any agency which has an agreement
with the Department of Education to be a guarantor of Federal Loans.
"HIGHER EDUCATION ACT" means the Higher Education Act of
1965, as amended, together with any rules, regulations and interpretations
thereunder.
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"INDENTURE" means the Master Indenture and any Terms
Supplement, each as amended or supplemented from time to time, with respect to
which the Notes issued thereunder are still Outstanding.
"INDENTURE TRUST ESTATE" means all money, instruments, rights
and other property that are, from time to time, subject or intended to be
subject to the Lien and security interest of the Indenture for the benefit of
the Noteholders (including all property and interests Granted to the Indenture
Trustee), including all proceeds thereof.
"INDENTURE TRUSTEE" means Bankers Trust Company, not in its
individual capacity but solely as Indenture Trustee under the Indenture.
"INDENTURE TRUSTEE FEE" has the meaning specified in Section
6.7 of the Master Indenture, as may be amended pursuant to any Terms
Supplement.
"INDEPENDENT" means, when used with respect to any specified
Person, that the Person (a) is in fact independent of the Issuer, any other
obligor upon the Notes, the Transferor and any Affiliate of any of the
foregoing Persons, (b) does not have any direct financial interest or any
material indirect financial interest in the Issuer, any such other obligor, the
Transferor or any Affiliate of any of the foregoing Persons and (c) is not
connected with the Issuer, any such other obligor, the Transferor or any
Affiliate of any of the foregoing Persons as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
"INDEPENDENT CERTIFICATE" means a certificate or opinion to
be delivered to the Indenture Trustee under the circumstances described in, and
otherwise complying with, the applicable requirements of Section 11.1 of the
Master Indenture, made by an Independent appraiser or other expert appointed by
an Issuer Order and approved by the Indenture Trustee in the exercise of
reasonable care, and such opinion or certificate shall state that the signer
has read the definition of "Independent" and that the signer is Independent
within the meaning thereof.
"INDIVIDUAL NOTE" means a Note of an initial principal amount
equal to $50,000. A Note of an original principal amount
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in excess thereof shall be deemed to be a number of Individual Notes equal to
the quotient obtained by dividing such initial principal amount by $50,000.
"INITIAL FINANCED STUDENT LOANS" has the meaning specified in
Section 2.1 of the related Transfer and Servicing Agreement or Supplemental
Transfer and Servicing Agreement.
"INITIAL CERTIFICATE BALANCE" means $1,000, representing the
Certificate Balance as of the Closing Date
"INITIAL PERIOD" means, as to the Series 1997-1 Notes and the
Certificates, the period commencing on the Closing Date and continuing through
and including May 14, 1997.
"INITIAL POOL BALANCE" means $536,975,870.94 representing the
Pool Balance as of the Cut-off Date.
"INSOLVENCY EVENT" means, with respect to a specified Person,
(a) the filing of a decree or order for relief by a court having jurisdiction
in the premises in respect of such Person or any substantial part of its
property 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, liquidator, assignee, custodian, trustee, sequestrator
or similar official for such Person or for any substantial part of its
property, or ordering the winding-up or liquidation of such Person's affairs,
and such decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or (b) the commencement by such Person of a voluntary case
under any applicable Federal or State bankruptcy, insolvency or other similar
law now or hereafter in effect, or the consent by such Person to the entry of
an order for relief in an involuntary case under any such law, or the consent
by such Person to the appointment of or taking possession by a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its property, or the making by such
Person of any general assignment for the benefit of creditors, or the failure
by such Person generally to pay its debts as such debts become due, or the
taking of action by such Person in furtherance of any of the foregoing.
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"INSTITUTION OF HIGHER EDUCATION" means an institution of
higher education as defined under the Higher Education Act (20 U.S.C.A. Section
1085(b)).
"INTEREST PERIOD" has the meaning set forth in the Terms
Supplement.
"INTEREST SUBSIDY PAYMENTS" means payments, designated as
such, consisting of interest subsidies by the Department in respect of the
Financed Student Loans to the Eligible Lender Trustee on behalf of the Trust in
accordance with the Higher Education Act.
"INVESTMENT EARNINGS" means, with respect to any Distribution
Date, the investment earnings (net of losses and investment expenses) on
amounts on deposit in the Trust Accounts to be deposited into the Collection
Account on or prior to such Distribution Date pursuant to Section 5.1(b) of the
Transfer and Servicing Agreement.
"ISSUER" means PNC Student Loan Trust I.
"ISSUER ORDER" and "ISSUER REQUEST" means a written order or
request signed in the name of the Issuer by any one of its Authorized Officers
and delivered to the Indenture Trustee.
"LIBOR DETERMINATION DATE" means, with respect to any Class
of Notes or the Certificates for which One-Month LIBOR is being determined
other than for the Initial Period, the applicable Rate Determination Date,
which must be a Business Day and London Banking Day.
"LIBOR RATE" means, with respect to any Class of Notes, or
the Certificates the related Class Interest Rate or Certificate rate, as the
case may be, that results from a determination based on One-Month LIBOR and is
determined as described in the Terms Supplement or Trust Agreement, as the case
may be.
"LIEN" means a security interest, lien, charge, pledge,
equity or encumbrance of any kind, other than tax liens and any other liens, if
any, which attach to the respective Financed Student Loan by operation of law
as a result of any act or omission by the related Obligor.
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"LONDON BANKING DAY" means any Business Day on which dealings
in deposits in United States dollars are transacted in the London interbank
market.
"MAJORITY CERTIFICATEHOLDER" means the holders of more than
50% of the Certificate Balance of the Certificates without regard to the
Certificates held by the Depositor.
"MAJORITY NOTEHOLDER" means Xxxxx Xxxxxx Mortgage Capital
Group, Inc. regardless of the amount of Notes held by it.
"MASTER INDENTURE" means the Indenture dated as of March 27,
1997 between the Issuer and the Indenture Trustee, as amended or supplemented
from time to time.
"MASTER SERVICER" means PNC Bank, National Association, and
its permitted successors and assigns, as Master Servicer of the Financed
Student Loans under the Transfer and Servicing Agreement.
"MASTER SERVICER DEFAULT" means an event specified in Section
8.1(a) of the related Transfer and Servicing Agreement or Supplemental Transfer
and Servicing Agreement.
"MONTHLY ADVANCE" means the amount, if any, advanced by the
Master Servicer pursuant to Section 5.10 of the Transfer and Servicing
Agreement with respect to Guarantee Payments or Interest Subsidy Payments
applied for but not received as of the end of the Collection Period immediately
preceding the date such Monthly Advance is made.
"MONTHLY ADVANCE ACCOUNT" means the account designated as
such, established and maintained pursuant to Section 5.1 of the Transfer and
Servicing Agreement.
"MOODY'S" means Moody's Investor's Service, Inc.
"NOTES" means the notes issued by the Issuer pursuant to the
Master Indenture and a Terms Supplement.
"NOTE DISTRIBUTION ACCOUNT" means the account designated as
such, established and maintained pursuant to Section 5.1 of the Transfer and
Servicing Agreement.
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"NOTE REGISTER" and "NOTE REGISTRAR" have the respective
meanings specified in Section 2.6 of the Indenture.
"NOTEHOLDER" means the Person in whose name a Note is
registered in the Note Register.
"NOTEHOLDERS' DISTRIBUTION AMOUNT" means, as to any Class of
Notes, with respect to any Distribution Date relating to such Notes, the sum of
the related Noteholders' Interest Distribution Amount and the Noteholders'
Principal Distribution Amount for such Note Distribution Date.
"NOTEHOLDERS' INTEREST CARRYOVER SHORTFALL" means, as to any
Class of Notes, with respect to any Distribution Date, the excess of (i) the
sum of the related Noteholders' Interest Distribution Amount on the preceding
Distribution Date and any Noteholders' Interest Carryover Shortfall on such
preceding Distribution Date over (ii) the amount of interest actually allocated
to such Noteholders on such preceding Note Distribution Date, plus interest on
the amount of such excess interest due to such Noteholders, to the extent
permitted by law, at the related Class Interest Rate from such preceding Note
Distribution Date to the current Distribution Date.
"NOTEHOLDERS' INTEREST DISTRIBUTION AMOUNT" means, as to any
Class of Notes, with respect to any Distribution Date, the sum of (i) the
amount of interest accrued at the respective Class Interest Rate for each
related Interest Period since the last Distribution Date (or in the case of the
first Distribution Date, the Closing Date) on the outstanding principal balance
of such Class of Notes on the immediately preceding Distribution Date relating
to such Notes after giving effect to all principal distributions to holders of
Notes of such Class on such date (or, in the case of the first Distribution
Date, the Closing Date) and (ii) the Noteholders' Interest Carryover Shortfall
for such Class for such Distribution Date.
"NOTEHOLDERS' PRINCIPAL CARRYOVER SHORTFALL" means, with
respect to any Class of Notes, as of the close of any Distribution Date, the
excess of (i) the sum of the Noteholders' Principal Distribution Amount on such
Distribution Date and any outstanding Noteholders' Principal Carryover
Shortfall for the preceding Distribution Date over (ii) the amount of principal
actually allocated to the Noteholders on such Distribution Date.
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"NOTEHOLDERS' PRINCIPAL DISTRIBUTION AMOUNT" means, (A) on
the Distribution Dates occurring in May, June, July and August 1997, $0, and
(B) on the Final Maturity Date the Noteholders' Principal Distribution Amount
will include the amount required to reduce the Outstanding Amount of such Notes
to zero.
"OBLIGOR" on a Financed Student Loan means the borrower or
co-borrowers of such Financed Student Loan and any other Person who owes
payments in respect of such Financed Student Loan, including (i) the Guaranty
Agency thereof and (ii) with respect to any Interest Subsidy Payment or Special
Allowance Payment, if any, thereon, the Department.
"OFFICER'S CERTIFICATE" means (i) in the case of the Issuer,
a certificate signed by an Authorized Officer of the Issuer, under the
circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.1 of the Indenture, and delivered to the Indenture
Trustee, (ii) in the case of the Transferor, the Master Servicer or the
Administrator, a certificate signed by an Authorized Officer of the Transferor,
the Master Servicer or the Administrator, as appropriate and (iii) in the case
of the Servicer, a certificate signed by an Authorized Officer of the Servicer.
"ONE-MONTH LIBOR" means the London interbank offered rate for
deposits in U.S. dollars having a maturity of one month commencing on the
related LIBOR Determination Date (the "Index Maturity") which appears on
Telerate Page 3750 as of 11:00 a.m., London time, on such LIBOR Determination
Date. If such rate does not appear on Telerate Page 3750, the rate for that day
will be determined on the basis of the rates at which deposits in U.S. dollars,
having the Index Maturity and in a principal amount of not less than U.S.
$1,000,000, are offered at approximately 11:00 a.m., London time, on such LIBOR
Determination Date to prime banks in the London interbank market by the
Reference Banks. The Master Servicer will request the principal London office
of each of such Reference Banks to provide a quotation of its rate. If at least
two such quotations are provided, the rate for that day will be the arithmetic
mean of the quotations. If fewer than two quotations are provided, the rate for
that day will be the arithmetic mean of the rates quoted by major banks in New
York City, selected by the Master Servicer, at approximately 11:00 a.m., New
York City time, on such LIBOR Determination Date for loans in U.S. dollars
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to leading European banks having the Index Maturity and in a principal amount
equal to an amount of not less than U.S. $1,000,000; provided that if the banks
selected as aforesaid are not quoting as mentioned in this sentence, One-Month
LIBOR in effect for the applicable Interest Period will be One-Month LIBOR in
effect for the previous Interest Period.
"OPINION OF COUNSEL" means (i) with respect to the Issuer,
one or more written opinions of counsel who may, except as otherwise expressly
provided in the Master Indenture, be employees of or counsel to the Issuer or
Administrator or any of their Affiliates and who shall be reasonably
satisfactory to the Indenture Trustee and the Majority Noteholder, and which
opinion or opinions shall be addressed to the Indenture Trustee as Indenture
Trustee and the Majority Noteholder, shall comply with any applicable
requirements of Section 11.1 of the Master Indenture, and shall be in form and
substance satisfactory to the Indenture Trustee and the Majority Noteholder and
(ii) with respect to the Transferor, the Administrator or the Master Servicer,
one or more written opinions of counsel who may be an employee of or counsel to
the Transferor, the Administrator or the Master Servicer, which counsel shall
be acceptable to the Indenture Trustee, the Eligible Lender Trustee and the
Majority Noteholder.
"OUTSTANDING" means, as of the date of determination, all
Notes theretofore authenticated and delivered under the Indenture except:
(i) Notes theretofore canceled by the Note Registrar or
delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in
the necessary amount has been theretofore deposited with the Indenture
Trustee or any Paying Agent in trust for the Noteholders thereof
(provided, however, that if such Notes are to be redeemed, notice of
such redemption has been duly given pursuant to the Indenture); and
(iii) Notes in exchange for or in lieu of other Notes which
have been authenticated and delivered pursuant to the Indenture unless
proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser;
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provided that in determining whether the Noteholders of the requisite
Outstanding Amount of the Notes have given any request, demand, authorization,
direction, notice, consent or waiver hereunder or under any other Basic
Document, Notes owned by the Issuer, any other obligor upon the Notes, the
Transferor or any Affiliate of any of the foregoing Persons shall be
disregarded and deemed not to be Outstanding, except that, in determining
whether the Indenture Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Notes that a Responsible Officer of the Indenture Trustee either actually knows
to be so owned or has received written notice thereof shall be do disregarded.
Notes so owned that have been pledged in good faith may be regarded as
Outstanding if the pledgee establishes to the satisfaction of the Indenture
Trustee the pledgee's right so to act with respect to such Notes and that the
pledgee is not the Issuer, any other obligor upon the Notes, the Transferor or
any Affiliate of any of the foregoing Persons.
"OUTSTANDING AMOUNT" means the aggregate principal amount of
all Notes, or Class of Notes, or Certificates as applicable, Outstanding at the
date of determination.
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"PAYING AGENT" means the Indenture Trustee or any other
Person that meets the eligibility standards for the Indenture Trustee specified
in Section 6.11 of the Master Indenture and is authorized by the Issuer to make
the payments to and distributions from the Collection Account and payments of
principal of and interest and any other amounts owing on the Notes on behalf of
the Issuer.
"PERSON" means any individual, corporation, estate,
partnership, joint venture, association, joint stock company, trust (including
any beneficiary thereof), unincorporated organization or government or any
agency or political subdivision thereof.
"PHEAA" means the Pennsylvania Higher Education Assistance
Agency.
"PHYSICAL PROPERTY" has the meaning assigned to such term in
the definition of "Delivery" above.
"PLEDGED ACCOUNT OR FUND" means the Collection Account, the
Reserve Account, the Note Distribution Account and the Certificate Distribution
Account.
"PLUS LOAN" means a Financed Student Loan made pursuant to
the provisions of the PLUS program established under Section 428B of the Higher
Education Act (or predecessor provisions).
"POOL BALANCE" means, at any time, the aggregate principal
balance of the Financed Student Loans at the end of the preceding Collection
Period (including accrued interest thereon for such Collection Period to the
extent such interest will be capitalized), after giving effect to the
following, without duplication: (i) all payments in respect of principal
received by the Trust during such Collection Period from or on behalf of
borrowers and Guarantors and, with respect to certain payments on certain
Financed Student Loans, the Department and (ii) the principal portion of all
Purchase Amounts received by the Trust for such Collection Period.
"PREDECESSOR NOTE" means, with respect to any particular
Note, every previous Note evidencing all or a portion of the same debt as that
evidenced by such particular Note; and,
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for the purpose of this definition, any Note authenticated and delivered under
Section 2.7 of the Master Indenture and in lieu of a mutilated, lost, destroyed
or stolen Note shall be deemed to evidence the same debt as the mutilated,
lost, destroyed or stolen Note.
"PREMIUM" means [Reserved]
"PRIMARY SERVICER" means, with respect to any Financed
Student Loan, the entity responsible for the primary servicing of such Financed
Student Loan on a day to day basis, it being understood that where a
subservicer appointed in accordance with the terms of the Transfer and
Servicing Agreement has responsibility for servicing a Financed Student Loan,
such subservicer and not the Master Servicer shall be the Primary Servicer with
respect such Financed Student Loan.
"PRINCIPAL DISTRIBUTION AMOUNT" means, with respect to any
Collection Period, the sum, without duplication, of the following amounts: (i)
that portion of all collections received by the Master Servicer or any Servicer
on the Financed Student Loans that is allocable to principal (including the
portion of any Guarantee Payments received that is allocable to principal of
the Financed Student Loans); (ii) the portion of the proceeds allocable to
principal from the sale of Financed Student Loans by the Trust during such
Collection Period (including but not limited to Financed Student Loans
repurchased by the Transferor or its designee or purchased by a Third Party
Purchaser pursuant to the provisions of Article X of the Transfer and Servicing
Agreement); (iii) all Realized Losses incurred during the related Collection
Period; and (iv) to the extent attributable to principal, the Purchase Amount
received with respect to each Financed Student Loan repurchased by the
Transferor or purchased by the Master Servicer under an obligation which arose
during the related Collection Period; provided, however, that the Principal
Distribution Amount will exclude all payments and proceeds of any Financed
Student Loans the Purchase Amount of which has been included in Available Funds
for a prior Collection Period.
"PROCEEDING" means any suit in equity, action at law or other
judicial or administrative proceeding.
"PURCHASE AMOUNT" means, as to any Financed Student Loan on
any date of determination, the amount required to prepay
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in full the outstanding principal balance of such Financed Student Loan as of
the last day of the most recently completed Collection Period, including all
accrued but unpaid interest thereon (including interest to be capitalized)
through the last day of the Collection Period in which such Financed Student
Loan is being purchased .
"PURCHASED STUDENT LOAN" means a Financed Student Loan
purchased pursuant to Section 4.5 of the Transfer and Servicing Agreement or
repurchased pursuant to Section 3.2 of the Transfer and Servicing Agreement or
Supplemental Transfer and Servicing Agreement.
"PUT OPTION" has the meaning set forth in Section 10.1(a) of
the Transfer and Servicing Agreement.
"PUT OPTION NOTICE" shall have the meaning set forth in
Section 10.1(a) of the Transfer and Servicing Agreement.
"PUT OPTION EXERCISE DATE" shall have the meaning set forth
in Section 10.1(a) of the Transfer and Servicing Agreement
"PUT OPTION PRICE" means, as to the Financed Student Loans on
any date of determination, 103.775% times the aggregate amount required to
prepay in full the outstanding principal balance of such Financed Student Loans
as of the last day of the most recently completed Collection Period, including
all accrued but unpaid interest thereon (including interest to be capitalized)
through the date the Put Option Price is deposited into the Collection Account
pursuant to Section 10.1(b) of the Transfer and Servicing Agreement.
"PUT OPTION PURCHASE DATE" has the meaning set forth in
Section 10.1(a) of the Transfer and Servicing Agreement.
"QUALIFIED LETTER OF CREDIT" means a letter of credit
delivered or to be delivered to the Indenture Trustee in lieu of a deposit of
cash or Eligible Investments in the Reserve Account for such Class or Series,
which letter of credit shall
(a) be irrevocable and name the Indenture Trustee, in its
capacity as such, as the sole beneficiary thereof;
(b) be issued by a bank whose credit standing is acceptable
to each of the rating agencies which are rating or have rated
the Notes of such Series and the Majority Noteholder;
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(c) provide that if at any time the then current credit
standing of the issuing bank is such that the continued
reliance on such letter of credit for the purpose or purposes
for which it was originally delivered to the Indenture
Trustee would result in a downgrading of any rating of the
Notes of such Class or Series, the Indenture Trustee may
either draw under such letter of credit any amount up to and
including the entire amount then remaining available for
drawing thereunder or terminate such letter of credit;
(d) be transferable to any successor trustee hereunder with
respect to such Class or Series; and
(e) meet such other standards as may be specified in the
Terms Supplement or reasonably required by the Majority
Noteholder.
"QUALIFIED INSTITUTIONAL BUYER" has the meaning ascribed to
such term in Rule 144A under the Securities Act.
"RATE ADJUSTMENT DATE" means, with respect to each Class of
Notes, the 15th day of each month, commencing May 15, 1997, which is the date
on which the applicable Class Interest Rate is effective and means, with
respect to each such Class of Notes, the date of commencement of each related
Interest Period.
"RATE DETERMINATION DATE" means the date which is both two
Business Days and two London Business Days preceding the related Rate
Adjustment Date.
"RATING AGENCY" means Xxxxx'x and Standard & Poor's. If no
such organization or successor is any longer in existence, "Rating Agency"
shall be a nationally recognized statistical rating organization or other
comparable Person designated by the Transferor, notice of which designation
shall be given to the Indenture Trustee, the Eligible Lender Trustee, the
Servicer and the Majority Noteholder.
"REALIZED LOSS" means, for each Financed Student Loan
submitted to a Guarantor for a Guarantee Payment, the excess, if
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any, of (i) the unpaid principal balance of such Financed Student Loan on the
date it was first submitted to a Guarantor for a Guarantee Payment over (ii)
all amounts received on or with respect to principal on such Financed Student
Loan (including amounts received pursuant to Sections 3.2 and 4.5 of the
Transfer and Servicing Agreement) up through the earlier to occur of (A) the
date a related Guarantee Payment is made or (B) the last day of the Collection
Period occurring 12 months after the date the claim for such Guarantee Payment
is first denied.
"RECORD DATE" means, with respect to a Distribution Date, the
close of business on the second Business Day preceding such Distribution Date.
"REFERENCE BANK" means a leading bank (i) engaged in
transactions in Eurodollar deposits in the international Eurocurrency market,
(ii) not controlling, controlled by or under common control with the
Administrator or the Transferor and (iii) having an established place of
business in London.
"RELATED FINANCED STUDENT LOAN FILE" has the meaning
specified in Section 3.8(a) of the Transfer and Servicing Agreement.
"REPAYMENT PHASE" means the period during which the related
borrower is required to make payments of principal and interest on the related
Financed Student Loan.
"REQUISITE AMOUNT" means, with respect to any Series for
which a Reserve Account is required to be maintained, an amount specified in or
determined pursuant to the related Terms Supplement.
"RESERVE ACCOUNT" means the account designated as such,
established and maintained pursuant to Section 5.1 of the related Transfer and
Servicing Agreement.
"RESERVE ACCOUNT INITIAL DEPOSIT" means, $0.
"RESPONSIBLE OFFICER" means, with respect to the Indenture
Trustee, any officer within the Corporate Trust Office of the Indenture Trustee
with direct responsibility for the administration of the Indenture and the
other Basic Documents on behalf of the Indenture Trustee, including any
Managing Director, Vice President, Assistant Vice President, Assistant
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Treasurer, Assistant Secretary, or any other officer of the Indenture Trustee
customarily performing functions similar to those performed by any of the above
designated officers and also, with respect to a particular matter, any other
officer to whom such matter is referred because of such officer's knowledge of
and familiarity with the particular subject.
"SALE CLOSING DATE" has the meaning set forth in section
10.2(b) of the Transfer and Servicing Agreement.
"SALE PRICE" has the meaning set forth in Section 10.2(a) of
the Transfer and Servicing Agreement.
"SCHEDULE OF FINANCED STUDENT LOANS" means the listing of the
Financed Student Loans set forth in Schedule A to the Transfer and Servicing
Agreement and to the Indenture (which Schedules may be in the form of
microfiche), as from time to time amended or supplemented. Such Schedule shall
list the Financed Student Loans being conveyed pursuant to the Transfer and
Servicing Agreement. The Schedule relating to the Indenture shall be a master
list of all Financed Student Loans then subject to the Lien of the Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as
amended.
"SENIOR NOTES" means the Notes designated as ranking senior
for each series of notes.
"SENIOR NOTEHOLDER" means the holder of Senior Notes.
"SERIAL LOAN" means a Financed Student Loan that is serial to
a student loan owned by a third party.
"SERIES" means a separate Series of Notes issued pursuant to
the Master Indenture, which Series may, as provided in the related Terms
Supplement, be divided into two or more Classes.
"SERIES 1997-1 NOTES" means the Notes designated as the
Issuer's Asset-Backed Notes, Series 1997-1, issued pursuant to the terms of the
Master Indenture and a Terms Supplement dated March 27, 1997 and having an
original principal amount equal to $544,931,645.
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"SERVICER" means AFSA, USA Group, Great Lakes, PHEAA or
another entity appointed, with the prior written consent of the Majority
Noteholder, by the Master Servicer to service the Financed Student Loans, in
its capacity as servicer of the Financed Student Loans.
"SERVICER'S REPORT" means any report of the Master Servicer
delivered pursuant to Section 4.8(a) of the Transfer and Servicing Agreement,
substantially in the form acceptable to the Administrator.
"SERVICING FEE" means, 115% of the aggregated amount paid
each month by the Master Servicer to each Servicer pursuant to the terms of the
Subservicing Agreement.
"SLS LOAN" means a Financed Student Loan designated as such
that is made under the Supplemental Loans for Students Program pursuant to the
Higher Education Act.
"SPECIAL ALLOWANCE PAYMENTS" means payments, designated as
such, consisting of effective interest subsidies by the Department in respect
of the Financed Student Loans to the Eligible Lender Trustee on behalf of the
Trust in accordance with the Higher Education Act.
"SPECIFIED RESERVE ACCOUNT BALANCE" means, $0.
"XXXXXXXX LOAN" means a Financed Student Loan designated as
such that is made under Section 428 of the Higher Education Act (excluding
Unsubsidized Xxxxxxxx Loans).
"STANDARD & POOR'S" means Standard & Poor's Rating Services,
a division of The XxXxxx-Xxxx Companies, Inc., and its successors and assigns.
"STATE" means any one of the 00 Xxxxxx xx xxx Xxxxxx Xxxxxx
xx Xxxxxxx or the District of Columbia.
"SUBCUSTODIAN" has the meaning specified in Section 3.8 of
the Transfer and Servicing Agreement.
"SUBSERVICING AGREEMENT" has the meaning specified in Section
4.13 of the Transfer and Servicing Agreement.
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"SUBORDINATED NOTES" means the notes designated as
subordinate to any class of Senior Notes.
"SUBORDINATED NOTEHOLDER" means any Noteholder of
Subordinated Notes.
"SUCCESSOR ADMINISTRATOR" has the meaning specified in
Section 3.7(e) of the Indenture.
"SUCCESSOR MASTER SERVICER" has the meaning specified in
Section 3.7(e) of the Indenture.
"TELERATE PAGE 3750" means the display page so designated on
the Dow Xxxxx Telerate Service (or such other page as may replace that page on
that service for the purpose of displaying comparable rates or prices).
"TERMS SUPPLEMENT" means initially, the Terms Supplement to
the Indenture dated as of March 27, 1997 between the Issuer and The Indenture
Trustee and thereafter, each indenture supplement to the Indenture which
authorizes a particular Series.
"THIRD PARTY PURCHASERS" has the meaning set forth in Section
10.2 of the Transfer and Servicing Agreement.
"TRANSACTION FEES" means, collectively, the Servicing Fee,
the Administration Fee, Indenture Trustee Fee and the Eligible Lender Trustee
Fee.
"TRANSFER AND SERVICING AGREEMENT" means the Transfer and
Servicing Agreement dated as of March 27, 1997, among the Issuer, the
Transferor, the Administrator, the Eligible Lender Trustee and the Master
Servicer, as amended from time to time.
"TRANSFEROR" means PNC Bank, National Association.
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"TREASURY REGULATIONS" means regulations, including proposed
or temporary regulations, promulgated under the Code. References in any
document or instrument to specific provisions of proposed or temporary
regulations shall include analogous provisions of final Treasury Regulations or
other successor Treasury Regulations.
"TRUST" means the Issuer, established pursuant to the Trust
Agreement.
"TRUST ACCOUNT PROPERTY" means the Trust Accounts, all
amounts and investments held from time to time in any Trust Account (whether in
the form of deposit accounts, Physical Property, book-entry securities,
uncertificated securities or otherwise), including the Reserve Account Initial
Deposit, if any, and all proceeds of the foregoing.
"TRUST ACCOUNTS" has the meaning specified in Section 5.1 of
the Transfer and Servicing Agreement.
"TRUST AGREEMENT" means the Trust Agreement dated as of March
27, 1997, between the Depositor and the Eligible Lender Trustee, as amended and
supplemented from time to time.
"TRUST CERTIFICATE" means a Certificate.
"TRUST CERTIFICATEHOLDER" means a person in whose name a
Trust Certificate is registered in the Certificate Register.
"TRUST ESTATE" means all right, title and interest of the
Trust (or the Eligible Lender Trustee on behalf of the Trust) in and to the
property and rights assigned to the Trust pursuant to Article II of the
Transfer and Servicing Agreement, all funds on deposit from time to time in the
Trust Accounts and all other property of the Trust from time to time, including
any rights of the Eligible Lender Trustee and the Trust pursuant to the
Transfer and Servicing Agreement and the Administration Agreement.
"TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act
of 1939 as in force on the date hereof, unless otherwise specifically provided.
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"UCC" means, unless the context otherwise requires, the
Uniform Commercial Code, as in effect in the relevant jurisdiction, as amended
from time to time.
"UNAMORTIZED PREMIUM" [Reserved].
"UNSUBSIDIZED XXXXXXXX LOAN" means a Financed Student Loan
designated as such that is made under Section 428H of the Higher Education Act.
"USA GROUP" means USA Group Loan Services, Inc.
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