<PAGE>

                                                                    Exhibit 10.7

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                               Indenture of Trust

                                  by and among

                        Education Funding Capital Trust-I

                                       and

                                Fifth Third Bank

                              as Indenture Trustee

                                       and

                                Fifth Third Bank

                        as Trust Eligible Lender Trustee

                             Dated as of May 1, 2002


================================================================================

<PAGE>

                        Education Funding Capital Trust-I

Reconciliation and tie between Trust Indenture Act of 1939 and Indenture of
Trust dated as of May 1, 2002.

            Trust Indenture Act Section                       Indenture Section
            ---------------------------                       -----------------

                  Section 310(a)(1)                                 6.22
                  (a)(2)                                            6.22
                  (b)                                               6.09, 6.11
                  Section 312(b)                                    8.14
                  (c)                                               8.14
                  Section 313(c)                                    3.16, 7.04
                  Section 314(a)                                    3.16
                  (a)(4)                                            3.17
                  Section 315(b)                                    7.04
                  Section 317(a)(1)                                 3.18
                  (a)(2)                                            6.23
                  Section 318(a)                                    8.07
                  (c)                                               8.07
___________________________

Note: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.

Attention should also be directed to Section 318(c) of the 1939 Act, which
provides that the provisions of Sections 310 to and including 317 of the 1939
Act are a part of and govern every qualified indenture, whether or not
physically contained therein.


                                       i

<PAGE>

                                Table of Contents

     (This Table of Contents is for convenience of reference only and is not
intended to define, limit or describe the purpose or intent of any provisions of
this Indenture of Trust.)

<TABLE>
<S>                                                                           <C>
ARTICLE I ..................................................................   3

NOTE DETAILS, FORM OF NOTES, REDEMPTION OF NOTES AND USE OF
PROCEEDS OF NOTES ..........................................................   3

   Section 1.01 Note Details ...............................................   3
   Section 1.02 Execution of Notes .........................................   3
   Section 1.03 Registration, Transfer and Exchange of Notes; Persons
   Treated as Noteholders ..................................................   3
   Section 1.04 Lost, Stolen, Destroyed and Mutilated Notes ................   4
   Section 1.05 Indenture Trustee's Authentication Certificate .............   4
   Section 1.06 Cancellation and Destruction of Notes by the
   Indenture Trustee .......................................................   4
   Section 1.07 Temporary Notes ............................................   5
   Section 1.08 Issuance of Notes ..........................................   5

ARTICLE II .................................................................   6

PARITY AND PRIORITY OF LIEN; OTHER OBLIGATIONS; AND DERIVATIVE PRODUCTS ....   6

   Section 2.01 Parity and Priority of Lien ................................   6
   Section 2.02 Other Obligations ..........................................   6
   Section 2.03 Derivative Products; Counterparty Derivative Payments;
   Issuer Derivative Payments ..............................................   7

ARTICLE III ................................................................   8

PROVISIONS APPLICABLE TO THE NOTES; ........................................   8

DUTIES OF THE ISSUER .......................................................   8
   Section 3.01 Payment of Principal, Interest and Premium .................   8
   Section 3.02 Representations and Warranties of the Issuer ...............   8
   Section 3.03 Covenants as to Additional Conveyances .....................   8
   Section 3.04 Further Covenants of the Issuer ............................   8
   Section 3.05 Enforcement of the Servicing Agreement .....................  10
   Section 3.06 Procedures for Transfer of Funds ...........................  11
   Section 3.07 Additional Covenants with Respect to the Act ...............  11
   Section 3.08 Financed Student Loans; Collections Thereof;
   Assignment Thereof ......................................................  12
   Section 3.09 Opinions as to the Trust Estate ............................  12
   Section 3.10 Appointment of Agents, Etc. ................................  13
   Section 3.11 Capacity to Sue ............................................  13
   Section 3.12 Continued Existence; Successor to Issuer ...................  13
   Section 3.13 Amendment of Transfer and Sale Agreements ..................  13
   Section 3.14 Representations; Negative Covenants ........................  13
   Section 3.15 Additional Covenants. So long as any of the Notes
   are Outstanding .........................................................  18
   Section 3.16 Providing of Notice ........................................  19
   Section 3.17 Reports by Issuer ..........................................  19
   Section 3.18 Statement as to Compliance .................................  20
   Section 3.19 Collection of Indebtedness and Suits for Enforcement by
   Indenture Trustee .......................................................  20
</TABLE>


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<PAGE>

<TABLE>
<S>                                                                          <C>
   Section 3.20 Representations of the Issuer Regarding the Indenture
   Trustee's Security Interest .............................................  21
   Section 3.21 Covenants of the Issuer Regarding the Indenture
                Trustee's Security Interest ................................  21
   Section 3.22 Certain Tax Forms and Treatment ............................  21

ARTICLE IV .................................................................  22

FUNDS ......................................................................  22

   Section 4.01 Creation and Continuation of Funds and Accounts ............  22
   Section 4.02 Acquisition Fund ...........................................  23
   Section 4.03 Revenue Fund ...............................................  24
   Section 4.04 Interest Fund ..............................................  26
   Section 4.05 Principal Fund .............................................  27
   Section 4.06 Reserve Fund ...............................................  28
   Section 4.07 Operating Fund .............................................  29
   Section 4.08 Transfers to Co-Owner Trustee ..............................  30
   Section 4.09 Capitalized Interest Fund ..................................  30
   Section 4.10 Investment of Funds Held by Indenture Trustee ..............  30
   Section 4.11 Indenture Trustee's Control over the Trust Accounts ........  31
   Section 4.12 Release; Sale of Financed Student Loans ....................  32
   Section 4.13 Purchase of Notes ..........................................  32

ARTICLE V ..................................................................  32

DEFAULTS AND REMEDIES ......................................................  32

   Section 5.01 Events of Default Defined ..................................  32
   Section 5.02 Remedy on Default; Possession of Trust Estate ..............  33
   Section 5.03 Remedies on Default; Advice of Counsel .....................  34
   Section 5.04 Remedies on Default; Sale of Trust Estate ..................  34
   Section 5.05 Appointment of Receiver ....................................  35
   Section 5.06 Restoration of Position ....................................  35
   Section 5.07 Purchase of Properties by Indenture Trustee
   or Noteholders ..........................................................  35
   Section 5.08 Application of Sale Proceeds ...............................  36
   Section 5.09 Accelerated Maturity .......................................  36
   Section 5.10 Remedies Not Exclusive .....................................  36
   Section 5.11 Direction of Indenture Trustee .............................  36
   Section 5.12 Right to Enforce in Indenture Trustee ......................  37
   Section 5.13 Physical Possession of Obligations Not Required ............  37
   Section 5.14 Waivers of Events of Default ...............................  37

ARTICLE VI .................................................................  38

THE INDENTURE TRUSTEE ......................................................  38

   Section 6.01 Acceptance of Trust ........................................  38
   Section 6.02 Recitals of Others .........................................  38
   Section 6.03 As to Filing of Indenture ..................................  39
   Section 6.04 Indenture Trustee May Act Through Agents ...................  39
   Section 6.05 Indemnification of Indenture Trustee .......................  39
   Section 6.06 Indenture Trustee's Right to Reliance ......................  40
   Section 6.07 Compensation of Indenture Trustee ..........................  41
   Section 6.08 Indenture Trustee May Own Notes ............................  41
   Section 6.09 Resignation of Indenture Trustee ...........................  42
</TABLE>


                                      iii

<PAGE>

<TABLE>
<S>                                                                          <C>
   Section 6.10 Removal of Indenture Trustee ...............................  42
   Section 6.11 Successor Indenture Trustee ................................  42
   Section 6.12 Manner of Vesting Title in Indenture Trustee ...............  43
   Section 6.13 Additional Covenants by the Indenture Trustee to
   Conform to the Act ......................................................  43
   Section 6.14 Limitation with Respect to Examination of Reports ..........  44
   Section 6.15 Servicing Agreement ........................................  44
   Section 6.16 Additional Covenants of Indenture Trustee ..................  44
   Section 6.17 Duty of Indenture Trustee with Respect to Rating Agencies ..  44
   Section 6.18 Merger of the Indenture Trustee ............................  45
   Section 6.19 Receipt of Funds from Servicer .............................  45
   Section 6.20 Special Circumstances Leading to Resignation of Indenture
   Trustee .................................................................  45
   Section 6.21 Survival of Indenture Trustee's Rights to Receive
   Compensation, Reimbursement and Indemnification .........................  45
   Section 6.22 Corporate Trustee Required; Eligibility;
   Conflicting Interests ...................................................  46
   Section 6.23 Payment of Taxes and Other Governmental Charges ............  46
   Section 6.24 Indenture Trustee May File Proofs of Claim .................  46

ARTICLE VII ................................................................  47

SUPPLEMENTAL INDENTURES ....................................................  47

   Section 7.01 Supplemental Indentures Not Requiring Consent
   of Noteholders ..........................................................  47
   Section 7.02 Supplemental Indentures Requiring Consent of Noteholders ...  49
   Section 7.03 Additional Limitation on Modification of Indenture .........  50
   Section 7.04 Notice of Defaults .........................................  50
   Section 7.05 Conformity With the Trust Indenture Act ....................  50

ARTICLE VIII ...............................................................  50

GENERAL PROVISIONS .........................................................  50

   Section 8.01 Notices ....................................................  50
   Section 8.02 Covenants Bind Issuer ......................................  52
   Section 8.03 Lien Created ...............................................  52
   Section 8.04 Severability of Lien .......................................  52
   Section 8.05 Consent of Noteholders Binds Successors ....................  52
   Section 8.06 Nonpresentment of Notes or Interest Checks .................  52
   Section 8.07 Laws Governing .............................................  53
   Section 8.08 Severability ...............................................  53
   Section 8.09 Exhibits ...................................................  53
   Section 8.10 Non-Business Days ..........................................  53
   Section 8.11 Parties Interested Herein ..................................  53
   Section 8.12 Obligations Are Limited Obligations ........................  53
   Section 8.13 Counterparty Rights ........................................  53
   Section 8.14 Disclosure of Names and Addresses of Noteholders ...........  53
   Section 8.15 Aggregate Principal Amount of Obligations ..................  54
   Section 8.16 Financed Student Loans .....................................  54
   Section 8.17 Limitation of Liability of the Co-Owner Trustee ............  54

ARTICLE IX .................................................................  54

PAYMENT AND CANCELLATION OF NOTES ..........................................  54
AND SATISFACTION OF INDENTURE ..............................................  54

   Section 9.01 Trust Irrevocable ..........................................  54
</TABLE>


                                       iv

<PAGE>

<TABLE>
<S>                                                                          <C>
   Section 9.02 Satisfaction of Indenture ..................................  54
   Section 9.03 Cancellation of Paid Notes .................................  55

ARTICLE X ..................................................................  55

TERMINATION ................................................................  55

   Section 10.01 Termination of the Trust ..................................  55
   Section 10.02 Notice ....................................................  55
ARTICLE XI .................................................................  55

REPORTING REQUIREMENTS .....................................................  55

   Section 11.01 Annual Statement as to Compliance .........................  56
   Section 11.02 Annual Independent Public Accountant's
   Servicing Report ........................................................  56
   Section 11.03 Servicer's Certificate ....................................  56
   Section 11.04 Statements to Noteholders .................................  56
</TABLE>


Exhibit A  Student Loan Acquisition Certificate

Exhibit B  Form of Issuer Order

Schedule A  Student Loans to be Acquired

Appendix A  Definitions and Usage


                                        v

<PAGE>

                               Indenture of Trust

     This Indenture of Trust, dated as of May 1, 2002 (this "Indenture"), is by
and among EDUCATION FUNDING CAPITAL TRUST-I, a Delaware business trust (the
"Issuer"), FIFTH THIRD BANK, a banking corporation organized under the laws of
the State of Ohio, as indenture trustee (the "Indenture Trustee"), and FIFTH
THIRD BANK, a banking corporation organized under the laws of the State of Ohio,
as trust eligible lender trustee (the "Trust Eligible Lender Trustee").
Capitalized terms used herein and not defined herein shall have the meanings
assigned to such terms in Appendix A hereto, which also contains rules of usage
and construction that shall be applicable herein.

                              W I T N E S S E T H:

     Whereas, the Issuer represents that it is duly created as a Delaware
business trust and that it has duly authorized the execution and delivery of
this Indenture, which Indenture provides for the payment of student loan
asset-backed notes (the "Notes") and the payments to any Counterparty (as
defined herein), all to be issued pursuant to the terms of Supplemental
Indentures; and

     Whereas, this Indenture may become subject to the provisions of the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act" or "TIA"), that are
deemed to be incorporated into this Indenture and shall, to the extent
applicable, be governed by such provisions; and

     Whereas, the Indenture Trustee has agreed to accept the trusts herein
created upon the terms herein set forth; and

     WHEREAS, it is hereby agreed between the parties hereto, the Noteholders
(the Noteholders evidencing their consent by their acceptance of the Notes) and
any Counterparty (the Counterparty evidencing its consent by its execution and
delivery of a Derivative Product (as defined herein)) that in the performance of
any of the agreements of the Issuer herein contained, any obligation it may
thereby incur for the payment of money shall not be general debt on its part,
but shall be secured by and payable solely from the Trust Estate, payable in
such order of preference and priority as provided herein;

     Now, Therefore, the Issuer (and, with respect to the legal title to the
Financed Student Loans that were originated under the Act, the Trust Eligible
Lender Trustee), in consideration of the premises and acceptance by the
Indenture Trustee of the trusts herein created, of the purchase and acceptance
of the Notes by the Noteholders thereof, of the execution and delivery of any
Derivative Product by a Counterparty and the Issuer and the acknowledgement
thereof by the Indenture Trustee, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, hereby Grant,
Convey, Pledge, Transfer, Assign and Deliver to the Indenture Trustee, for the
benefit of the Noteholders, any Counterparty (to secure the payment of any and
all amounts that may from time to time become due and owing to a Counterparty
pursuant to any Derivative Product), all of their right, title and interest in
and to the moneys, rights, and properties described in the granting clauses A
through F below (the "Trust Estate"), as follows:

<PAGE>

                                Granting Clause A

     The Revenues (other than Revenues deposited in the Operating Fund or
otherwise released from the lien of the Trust Estate as provided herein);

                                Granting Clause B

     All moneys and investments held in the Funds created under Section 4.01(a)
hereof (other than the moneys and investments held in the Operating Fund);

                                Granting Clause C

     The Financed Student Loans;

                                Granting Clause D

     The Servicing Agreement, the Subservicing Agreement, the Transfer and Sale
Agreements and the Guarantee Agreements as the same relate to Financed Student
Loans;

                                Granting Clause E

     Any Derivative Product and any guarantee of any Counterparty; provided,
however, that this Granting Clause E shall not be for the benefit of a
Counterparty with respect to its Derivative Product; and

                                Granting Clause F

     Any and all other property, rights and interests of every kind or
description that from time to time hereafter is granted, conveyed, pledged,
transferred, assigned or delivered to the Indenture Trustee as additional
security hereunder.

     To Have And To Hold the Trust Estate, whether now owned or
held or hereafter acquired, unto the Indenture Trustee and its successors or
assigns,

     In Trust Nevertheless, upon the terms and trusts herein set
forth for the equal and proportionate benefit and security of all present and
future Noteholders, without preference of any Note over any other, except as
provided herein, and for enforcement of the payment of the Notes in accordance
with their terms, and all other sums payable hereunder (including payments due
and payable to any Counterparty) or on the Notes, and for the performance of and
compliance with the obligations, covenants, and conditions of this Indenture, as
if all the Notes and other Obligations (as defined herein) at any time
Outstanding had been executed and delivered simultaneously with the execution
and delivery of this Indenture;

     Provided, However, that if the Issuer, its successors or assigns, shall
well and truly pay, or cause to be paid, the principal of the Notes and the
interest due and to become due thereon, or provide fully for payment thereof as
herein provided, at the times and in the manner mentioned in the Notes according
to the true intent and meaning thereof, and shall make all required payments
into the Funds as required under Article IV hereof, or shall provide, as


                                       2

<PAGE>

permitted hereby, for the payment thereof by depositing with the Indenture
Trustee sums sufficient to pay or to provide for payment of the entire amount
due and to become due as herein provided (including payments due and payable to
any Counterparty), then this Indenture and the rights hereby granted shall
cease, terminate and be void; otherwise, this Indenture shall be and remain in
full force and effect;

     Now, Therefore, it is mutually covenanted and agreed as follows:

                                    Article I

  Note Details, Form of Notes, Redemption of Notes and Use of Proceeds of Notes

     Section 1.01 Note Details. The details of each Series of Notes authorized
pursuant to this Indenture and a Supplemental Indenture, shall be contained in
the applicable Supplemental Indenture. Such details shall include, but are not
limited to, the principal amount, authorized denomination, dated date, interest
rate, principal maturity date, redemption provisions and registration
provisions.

     Section 1.02 Execution of Notes. The Notes shall be executed in the name
and on behalf of the Issuer by the manual or facsimile signature of any of its
Authorized Officers. Any Note may be signed (manually or by facsimile) or
attested on behalf of the Issuer by any person who, at the date of such act,
shall hold the proper office, notwithstanding that at the date of
authentication, issuance or delivery, such person may have ceased to hold such
office.

     Section 1.03 Registration, Transfer and Exchange of Notes; Persons Treated
as Noteholders. The Issuer shall cause books for the registration and for the
transfer of the Notes as provided in this Indenture to be kept by the Indenture
Trustee, which is hereby appointed the transfer agent of the Issuer for the
Notes. Notwithstanding such appointment and with the prior written consent of
the Issuer, the Indenture Trustee is hereby authorized to make any arrangements
with other institutions that it deems necessary or desirable in order that such
institutions may perform the duties of transfer agent for the Notes. Upon
surrender for transfer of any Note at the Corporate Trust Office of the
Indenture Trustee, duly endorsed for transfer or accompanied by an assignment
duly executed by the Noteholder or his attorney duly authorized in writing, the
Issuer shall execute and the Indenture Trustee shall authenticate and deliver,
making all appropriate notations on its records, and causing the same to be made
on the records of its nominees, in the name of the transferee or transferees a
new fully registered Note or Notes of the same interest rate and for a like
Series, subseries, if any, and aggregate principal amount of the same maturity.

     Notes may be exchanged at the Corporate Trust Office of the Indenture
Trustee for a like aggregate principal amount of fully registered Notes of the
same Series, subseries, if any, interest rate and maturity in authorized
denominations. The Issuer shall execute and the Indenture Trustee shall
authenticate and deliver Notes that the Noteholder making the exchange is
entitled to receive, bearing numbers not contemporaneously outstanding. The
execution by the Issuer of any fully registered Note of any authorized
denomination shall constitute full and due authorization of such denomination
and the Indenture Trustee shall thereby be authorized to authenticate and
deliver such fully registered Note.


                                        3

<PAGE>

     The Indenture Trustee shall not be required to transfer or exchange any
Note during the period 15 Business Days next preceding the mailing of notice of
redemption as herein provided. After the giving of such notice of redemption,
the Indenture Trustee shall not be required to transfer or exchange any Note
that has been called for full or partial redemption.

     As to any Note, the Person in whose name the Note is registered shall be
deemed and regarded as the absolute owner thereof for all purposes, and payment
of either principal or interest on any fully registered Note shall be made only
to or upon the written order of the Noteholder thereof or his legal
representative. All such payments shall be valid and effectual to satisfy and
discharge the liability upon such Note to the extent of the sum or sums paid.

     The Indenture Trustee shall require the payment by any Noteholder
requesting exchange or transfer of any tax or other governmental charge required
to be paid with respect to such exchange or transfer. The Noteholder requesting
such transfer or exchange may be required to pay all taxes and governmental
charges in connection with such transfer or exchange.

     Section 1.04 Lost, Stolen, Destroyed and Mutilated Notes. Upon receipt by
the Indenture Trustee of evidence satisfactory to it of the ownership of and the
loss, theft, destruction or mutilation of any Note and, in the case of a lost,
stolen or destroyed Note, of indemnity satisfactory to it, and upon surrender
and cancellation of the Note, if mutilated, (a) the Issuer shall execute, and
the Indenture Trustee shall authenticate and deliver, a new Note of the same
Series, subseries, if any, interest rate, maturity and denomination in lieu of
such lost, stolen, destroyed or mutilated Note or (b) if such lost, stolen,
destroyed or mutilated Note shall have matured or have been called for
redemption, in lieu of executing and delivering a new Note as aforesaid, the
Issuer may pay such Note. Any such new Note shall bear a number not
contemporaneously outstanding. The Person requesting any such new Note may be
required to pay all taxes and governmental charges and all expenses and charges
of the Issuer and of the Indenture Trustee in connection with the issuance of
such Note. All Notes shall be held and owned upon the express condition that, to
the extent permitted by law, the foregoing conditions are exclusive with respect
to the replacement and payment of mutilated, destroyed, lost or stolen Notes,
negotiable instruments or other securities.

     Section 1.05 Indenture Trustee's Authentication Certificate. The Indenture
Trustee's authentication certificate upon any Notes shall be substantially in
the form provided in the Supplemental Indenture authorizing the issuance of such
Notes. No Note shall be secured hereby or entitled to the benefit hereof, or
shall be valid or obligatory for any purpose, unless a certificate of
authentication, substantially in such form, has been duly executed by the
Indenture Trustee; and such certificate of the Indenture Trustee upon any Note
shall be conclusive evidence and the only competent evidence that such Note has
been authenticated and delivered hereunder and under a Supplemental Indenture.
The Indenture Trustee's certificate of authentication shall be deemed to have
been duly executed by it if manually signed by an authorized officer or
signatory of the Indenture Trustee, but it shall not be necessary that the same
person sign the certificate of authentication on all of the Notes issued
hereunder.

     Section 1.06 Cancellation and Destruction of Notes by the Indenture
Trustee. Whenever any Outstanding Notes are delivered to the Indenture Trustee
for the cancellation thereof pursuant to this Indenture, upon payment of the
principal amount and interest represented


                                        4

<PAGE>

thereby, or for replacement pursuant to Section 1.03 hereof, such Notes shall be
promptly cancelled and, within a reasonable time, cremated or otherwise
destroyed by the Indenture Trustee and counterparts of a certificate of
destruction evidencing such cremation or other destruction shall be furnished by
the Indenture Trustee to the Issuer.

     Section 1.07 Temporary Notes. Pending the preparation of definitive Notes,
the Issuer may execute and the Indenture Trustee shall authenticate and deliver
temporary Notes. Temporary Notes shall be issuable as fully registered Notes
without coupons, of any denomination, and substantially in the form of the
definitive Notes but with such omissions, insertions and variations as may be
appropriate for temporary Notes, all as may be determined by the Issuer. Every
temporary Note shall be executed by the Issuer and be authenticated by the
Indenture Trustee upon the same conditions and in substantially the same manner,
and with like effect, as the definitive Notes. As promptly as practicable the
Issuer shall execute and shall furnish definitive Notes and thereupon temporary
Notes may be surrendered in exchange therefor without charge at the Corporate
Trust Office of the Indenture Trustee, and the Indenture Trustee shall
authenticate and deliver in exchange for such temporary Notes a like aggregate
principal amount of definitive Notes. Until so exchanged the temporary Notes
shall be entitled to the same benefits under this Indenture as definitive Notes.

     Section 1.08 Issuance of Notes.

     (a)    The Issuer shall have the authority, upon complying with the
provisions of this Section 1.08, to issue and deliver from time to time Notes
secured by the Trust Estate on a parity with the Senior Notes or the Subordinate
Notes, or other borrowings of the Issuer, if any, secured hereunder as shall be
determined by the Issuer. In addition, the Issuer may enter into any Derivative
Products it deems necessary or desirable with respect to any or all of the
Notes.

     (b)    No Notes shall be authenticated and delivered pursuant to this
Indenture until the following conditions have been satisfied:

     (i)    The Issuer and the Indenture Trustee have entered into a
   Supplemental Indenture (which Supplemental Indenture shall not require the
   approval of the Noteholders of any of the Outstanding Notes or Derivative
   Products) providing the terms and forms of the proposed Notes as described
   in Section 1.01 hereof, including the designation of such Notes as Senior
   Notes or Subordinate Notes or another designation that indicates the
   priority of such Notes with respect to other Notes secured under this
   Indenture, the redemption and selection provisions applicable to such
   Notes, and the Reserve Fund Requirement with respect to such Notes, if any;

     (ii)   The Indenture Trustee shall have received a Rating Confirmation from
   each Rating Agency that has assigned a Rating or Ratings to any Outstanding
   Notes that such Rating or Ratings will not be reduced or withdrawn as a
   result of the issuance of the proposed Notes;

     (iii)  Upon the issuance of the proposed Notes, an amount equal to the
   Reserve Fund Requirement with respect to such Notes, if any, shall be
   deposited into the Reserve Fund; and


                                       5

<PAGE>

     (iv)  The Indenture Trustee shall have received a written order from the
   Issuer to authenticate and deliver the Notes.

     (c)   The Indenture Trustee is authorized to set up any additional Funds or
Accounts or Subaccounts under this Indenture that it deems necessary or
convenient in connection with the issuance and delivery of any Notes.

                                   Article II

     Parity and Priority of Lien; Other Obligations; and Derivative Products

     Section 2.01 Parity and Priority of Lien. The provisions, covenants and
agreements herein set forth to be performed by or on behalf of the Issuer are
for the equal benefit, protection and security of the Noteholders or any holders
of the Obligations, all of which, regardless of the time or times of their
issuance or maturity, shall be of equal rank without preference, priority or
distinction of any of the Obligations over any other thereof, except as
expressly provided in this Indenture with respect to certain payment and other
priorities.

     Section 2.02 Other Obligations.

     (a)    The Issuer shall not issue any Notes, incur any obligations or
engage in any activities other than in connection with the purposes and powers
of the Issuer as set forth in Section 2.3 of the Trust Agreement.

     (b)    The Issuer may commingle the Funds established by this Indenture
with funds, proceeds, or investments of funds relating to other issues or Series
of notes heretofore or hereafter issued.

     (c)    The revenues and other moneys, Financed Student Loans, securities,
evidences of indebtedness, interests, rights and properties pledged under this
Indenture are and will be owned by the Issuer (or the Trust Eligible Lender
Trustee) free and clear of any pledge, lien, charge or encumbrance thereon or
with respect thereto prior to or of equal rank with the respective pledges
created by this Indenture, except as otherwise expressly provided herein, and
all action on the part of the Issuer to that end has been duly and validly
taken. If any Financed Student Loan is found to have been subject to a lien at
the time such Financed Student Loan was acquired, the Issuer shall cause such
lien to be released, shall purchase such Financed Student Loan from the Trust
Estate for a purchase price equal to its principal amount plus unamortized
premium, if any, and interest accrued thereon, or shall replace such Financed
Student Loan with another Student Loan with substantially identical
characteristics that shall be free and clear of liens at the time of such
replacement. Except as otherwise provided herein, the Issuer shall not create or
voluntarily permit to be created any debt, lien, or charge on the Financed
Student Loans that would be on a parity with or prior to the lien of this
Indenture; shall not do or omit to do or suffer to be done or omitted to be done
anything whatsoever whereby the lien of this Indenture or the priority of such
lien for the Obligations hereby secured might or could be lost or impaired; and
will pay or cause to be paid or will make adequate provisions for the
satisfaction and discharge of all lawful claims and demands that if unpaid might
by law be given precedence to or any equality with this Indenture as a lien or
charge upon the Financed Student Loans; provided, however, that nothing in this
subsection (c) shall require the Issuer to pay, discharge, or make


                                       6

<PAGE>

provision for any such lien, charge, claim, or demand so long as the validity
thereof shall be by it in good faith contested, unless thereby, the same will
endanger the security for the Obligations; and provided further that any
subordinate lien hereon (i.e., subordinate to the lien securing the Senior
Obligations and the Subordinate Obligations) shall be entitled to no payment
from the Trust Estate, nor may any remedy be exercised with respect to such
subordinate lien against the Trust Estate until all Obligations have been paid
or deemed paid hereunder.

     Section 2.03 Derivative Products; Counterparty Derivative Payments; Issuer
Derivative Payments. The Issuer hereby authorizes and directs the Indenture
Trustee to acknowledge and agree to any Derivative Product hereafter entered
into by the Issuer and a Counterparty under which (a) the Issuer may be required
to make, from time to time, Issuer Derivative Payments and (b) the Indenture
Trustee may receive, from time to time, Counterparty Derivative Payments for the
account of the Issuer. No Derivative Product shall be entered into unless (i)
the Indenture Trustee shall have received a Rating Confirmation from each Rating
Agency that such Derivative Product will not adversely affect the Rating on any
of the Notes and (ii) all Issuer Derivative Payments and Counterparty Derivative
Payments are to be made on the third Business Day immediately preceding a
Payment Date. Anything in this Indenture to the contrary notwithstanding, any
Revenues representing Counterparty Derivative Payments of a Counterparty shall
not be available to make an Issuer Derivative Payment to another Counterparty or
to pay any other amounts owed to such Counterparty pursuant to a Derivative
Product.

     No later than the fourth Business Day immediately preceding each Derivative
Payment Date the Issuer shall give written notice to the Indenture Trustee
stating (a) the amount and payer of each Counterparty Derivative Payment, if
any, due to be received by the Indenture Trustee for the account of the Issuer
on the third Business Day immediately preceding such Derivative Payment Date and
(b) the amount and payee of each Issuer Derivative Payment, if any, to be paid
on the third Business Day immediately preceding such Derivative Payment Date. If
the Indenture Trustee fails to receive such written notification from the Issuer
by the end of such third Business Day, it shall immediately notify the Issuer of
such fact in writing.

     On the third Business Day immediately preceding each Derivative Payment
Date and in accordance with the written notification received from the Issuer,
the Indenture Trustee shall deposit all moneys received representing
Counterparty Derivative Payments into the Revenue Fund to be applied in
accordance with the provisions of Section 4.03 hereof. The Indenture Trustee
shall notify the Issuer on such Business Day, if (a) the amount received from
any Counterparty is not equal to the amount specified in the written
notification of the Issuer, (b) no amount is received from such Counterparty or
(c) the amount received is not received in immediately available funds.

     On the third Business Day immediately preceding any Derivative Payment Date
with respect to which an Issuer Derivative Payment is due in accordance with the
written notification received from the Issuer or, with respect to a payment in
respect of an early termination date due from the Issuer pursuant to the terms
of a Derivative Product, the Indenture Trustee shall make payment to the
appropriate Counterparty from moneys in the Revenue Fund of the amount of the
Issuer Derivative Payment specified in such written notification of the Issuer
due on such date by the deposit or wire transfer of immediately available funds
to the


                                        7

<PAGE>

credit of the account of such Counterparty specified in such written
notification of the Issuer, but only to the extent such payment will not result
in a deficiency in the amount due on the next succeeding Payment Date to the
holders of any class of Obligations having a priority equal to or higher than
the Derivative Product in respect of which such Issuer Derivative Payment is
due.

     If any payment to a Counterparty described in the immediately preceding
paragraph would result in a deficiency in the amounts required to make payments
to the holders of the Obligations referred to in that paragraph on such Payment
Date, then the Indenture Trustee shall delay the making of such payment to such
Counterparty until the first date on which no deficiency would result from such
payment and the Indenture Trustee has been notified in writing to make such
payment.

                                   Article III

                       Provisions Applicable to the Notes;
                              Duties of the Issuer

     Section 3.01 Payment of Principal, Interest and Premium. The Issuer
covenants that it will promptly pay, but solely from the Trust Estate, the
principal of and interest, if any, on each and every Obligation issued under the
provisions of this Indenture at the places, on the dates and in the manner
specified herein and in said Obligations and any premium required for the
retirement of said Obligations by purchase or redemption according to the true
intent and meaning thereof. The Obligations shall be and are hereby declared to
be payable from and equally secured by an irrevocable first lien on and pledge
of the properties constituting the Trust Estate, subject to the application
thereof as permitted by this Indenture, but in no event shall the Noteholders or
any holders of the Obligations have any right to possession of any Financed
Student Loans, which shall be held only by the Indenture Trustee or its agent or
bailee.

     Section 3.02 Representations and Warranties of the Issuer. The Issuer
represents and warrants that it is duly authorized under the laws of Delaware to
issue the Notes and to execute and deliver this Indenture and any Derivative
Product and to make the pledge to the payment of Notes and any Issuer Derivative
Payments hereunder, that all necessary action on the part of the Issuer for the
creation and issuance of the Notes and the execution and delivery of this
Indenture and any Derivative Product has been duly and effectively taken, and
that the Notes in the hands of the Noteholders thereof and the Issuer Derivative
Payments are and will be valid and enforceable special limited obligations of
the Issuer secured by and payable solely from the Trust Estate.

     Section 3.03 Covenants as to Additional Conveyances. At any and all times,
the Issuer will duly execute, acknowledge, and deliver, or will cause to be
done, executed, and delivered, all and every such further acts, conveyances,
transfers, and assurances in law as the Indenture Trustee shall reasonably
require for the better conveying, transferring, and pledging and confirming unto
the Indenture Trustee, all and singular, the properties constituting the Trust
Estate hereby transferred and pledged, or intended so to be transferred and
pledged.

     Section 3.04 Further Covenants of the Issuer.


                                        8

<PAGE>

     (a) The Issuer will cause financing statements and continuation statements
with respect thereto at all times to be filed in the office of the Secretary of
the State of Delaware and any other jurisdiction necessary to perfect and
maintain the security interest granted by the Issuer hereunder.

     (b) The Issuer will duly and punctually keep, observe and perform each and
every term, covenant, and condition on its part to be kept, observed, and
performed, contained in this Indenture and the other agreements to which the
Issuer is a party pursuant to the transactions contemplated herein, and will
punctually perform all duties required by the Trust Agreement and the laws of
Delaware.

     (c) The Issuer shall be operated on the basis of its Fiscal Year.

     (d) The Issuer shall cause to be kept full and proper books of records and
accounts, in which full, true, and proper entries will be made of all dealings,
business, and affairs of the Issuer that relate to the Notes and any Derivative
Product.

     (e) The Issuer, upon written request of the Indenture Trustee, will permit
at all reasonable times the Indenture Trustee or its agents, accountants, and
attorneys, to examine and inspect the property, books of account, records,
reports, and other data relating to the Financed Student Loans, and will furnish
the Indenture Trustee such other information as it may reasonably request. The
Indenture Trustee shall be under no duty to make any such examination unless
requested in writing to do so by the Noteholders of not less than a majority of
the principal amount of the Notes, and unless such Noteholders shall have
offered the Indenture Trustee security and indemnity satisfactory to it against
any costs, expenses and liabilities that might be incurred thereby.

     (f) The Issuer shall cause an annual audit to be made by an independent
auditing firm of national reputation and file one copy thereof with the
Indenture Trustee and each Rating Agency within 150 days of the close of each
Fiscal Year. The Indenture Trustee shall be under no obligation to review or
otherwise analyze such audit.

     (g) The Issuer covenants that all Financed Student Loans upon receipt
thereof shall be delivered to the Indenture Trustee or its agent or bailee to be
held pursuant to this Indenture and pursuant to the Servicing Agreement, a
Subservicing Agreement or a custodian agreement.

     (h) Notwithstanding anything to the contrary contained herein, except upon
the occurrence and during the continuance of an Event of Default hereunder, the
Issuer hereby expressly reserves and retains the privilege to receive and,
subject to the terms and provisions of this Indenture, to keep or dispose of,
claim, bring suits upon or otherwise exercise, enforce or realize upon its
rights and interest in and to the Financed Student Loans and the proceeds and
collections therefrom, and neither the Indenture Trustee nor any Noteholder
shall in any manner be or be deemed to be an indispensable party to the exercise
of any such privilege, claim or suit, and the Indenture Trustee shall be under
no obligation whatsoever to exercise any such privilege, claim or suit;
provided, however, that the Indenture Trustee shall have and retain possession
of the Financed Student Loans pursuant to Section 4.02 hereof (which Financed
Student Loans may


                                       9

<PAGE>

be held by the Indenture Trustee's agent or bailee) so long as such loans are
subject to the lien of this Indenture.

     (i) The Issuer shall notify the Indenture Trustee and each Rating Agency in
writing prior to entering into any Derivative Product and shall not enter into
any Derivative Product unless the Indenture Trustee has received a Rating
Confirmation.

     Section 3.05 Enforcement of the Servicing Agreement. Regardless of whether
the Issuer is otherwise in default under this Indenture, the Issuer shall comply
with and shall require the Servicer to comply with the following:

     (a) The Issuer shall diligently enforce and take all reasonable steps,
         actions and proceedings necessary for the enforcement of all terms,
         covenants and conditions of the Servicing Agreement, including the
         prompt payment of all amounts due the Issuer thereunder, including
         without limitation all principal and interest payments and Guarantee
         Payments that relate to any Financed Student Loans, and cause the
         Servicer to specify whether payments received by it represent principal
         or interest;

     (b) The Issuer shall not permit the release of the obligations of the
         Servicer under the Servicing Agreement except in conjunction with
         amendments or modifications permitted by (h) below;

     (c) The Issuer shall at all times, to the extent permitted by law, cause to
         be defended, enforced, preserved and protected the rights and
         privileges of the Issuer and of the Noteholders under or with respect
         to the Servicing Agreement;

     (d) The Issuer shall at its own expense duly and punctually perform and
         observe each of its obligations to the Servicer under the Servicing
         Agreement in accordance with the terms thereof;

     (e) The Issuer shall give the Indenture Trustee and the Rating Agencies
         prompt written notice of each default on the part of the Servicer of
         its obligations under the Servicing Agreement coming to the Issuer's
         attention;

     (f) The Issuer shall not waive any default by the Servicer under the
         Servicing Agreement without the written consent of the Indenture
         Trustee;

     (g) The Issuer shall cause the Servicer to deliver to the Indenture Trustee
         and the Issuer, on or before March 31 of each year, beginning with
         March 31, 2003, a certificate stating that (i) a review of the
         activities of the Servicer during the preceding calendar year and of
         its performance under the Servicing Agreement has been made under the
         supervision of the officer signing such certificate and (ii) to the
         best of such officers' knowledge, based on such review, the Servicer
         has fulfilled all its obligations under the Servicing Agreement
         throughout such year, or, there has been a default


                                       10

<PAGE>

         in the fulfillment of any such obligation, specifying each such
         default known to such officer and the nature and status thereof. The
         Issuer shall send copies of such annual certificate of the Servicer to
         each Rating Agency; and

     (h) The Issuer shall not consent or agree to or permit any amendment or
         modification of the Servicing Agreement that will in any manner
         materially adversely affect the rights or security of the Noteholders.
         The Issuer shall be entitled to receive and rely upon an opinion of its
         counsel that any such amendment or modification will not materially
         adversely affect the rights or security of the Noteholders.

     Section 3.06 Procedures for Transfer of Funds. In any instance where this
Indenture requires a transfer of funds or money from one Fund to another, a
transfer of ownership in investments or an undivided interest therein may be
made in any manner agreeable to the Issuer and the Indenture Trustee, and in the
calculation of the amount transferred, interest on the investment that has or
will accrue before the date the money is needed in the Fund to which the
transfer is made shall not be taken into account or considered as money on hand
at the time of such transfer.

     Section 3.07 Additional Covenants with Respect to the Act. The Issuer
covenants that (i) so long as any of the Financed Student Loans were originated
under the Act, it will cause the Indenture Trustee to be, or replace the
Indenture Trustee with, an Eligible Lender under the Act, (ii) all Student Loans
originated under the Act that it acquires shall be acquired from, and it shall
cause such Student Loans to be held by, only an Eligible Lender, and (iii) it
will not dispose of or deliver any Student Loan originated under the Act or any
security interest in any such Student Loans to any party who is not an Eligible
Lender so long as the Act or Regulations adopted thereunder require an Eligible
Lender to be the owner or holder of Student Loans originated under the Act;
provided, however, that nothing above shall prevent the Issuer from delivering
Student Loans originated under the Act to the Servicer, any Subservicer or
Guaranty Agency. The Noteholders shall not in any circumstances be deemed to be
the owner or holder of Student Loans originated under the Act.

     The Issuer, or its designated agent, shall be responsible for each of the
following actions with respect to the Act:

     (a) the Issuer, or its designated agent, shall be responsible for dealing
with the Secretary with respect to the rights, benefits and obligations under
the Certificates of Insurance and the Contract of Insurance, and the Issuer
shall be responsible for dealing with the Guarantee Agencies with respect to the
rights, benefits and obligations under the Guarantee Agreements with respect to
Guaranteed Student Loans;

     (b) the Issuer, or its designated agent, shall cause to be diligently
enforced, and shall cause to be taken all reasonable steps, actions and
proceedings necessary or appropriate for the enforcement of all terms, covenants
and conditions of all Financed Student Loans and agreements in connection
therewith, including the prompt payment of all principal and interest payments
and all other amounts due thereunder;


                                       11

<PAGE>

     (c) the Issuer, or its designated agent, shall cause the Financed Student
Loans to be serviced by entering into the Servicing Agreement or other agreement
with the Servicer for the collection of payments made for, and the
administration of the accounts of, the Financed Student Loans;

     (d) the Issuer, or its designated agent, shall comply, and shall cause all
of its officers, directors, employees and agents to comply, with the provisions
of the Act and any regulations or rulings thereunder, with respect to Financed
Student Loans that were originated under the Act; and

     (e) the Issuer, or its designated agent, shall cause the benefits of the
Guarantee Agreements, the Interest Subsidy Payments and the Special Allowance
Payments to flow to the Indenture Trustee. The Indenture Trustee shall have no
liability for actions taken at the direction of the Issuer, except for gross
negligence or willful misconduct in the performance of its express duties
hereunder. The Indenture Trustee shall have no obligation to administer, service
or collect the loans in the Trust Estate or to maintain or monitor the
administration, servicing or collection of such loans.

     The Indenture Trustee shall not be deemed to be the designated agent for
the purposes of this Section 3.07 unless it has agreed in writing to be such
agent.

     Section 3.08 Financed Student Loans; Collections Thereof; Assignment
Thereof. The Issuer, through the Servicer, shall diligently collect all
principal and interest payments on all Financed Student Loans, and all Interest
Benefit Payments, insurance, guarantee and default claims and Special Allowance
Payments that relate to such Financed Student Loans. The Issuer shall cause the
filing and assignment of such claims (prior to the timely filing deadline for
such claims under the Regulations, if applicable) by the Servicer. The Issuer
will comply with the Act and Regulations that apply to the Program and to such
Financed Student Loans.

     Section 3.09 Opinions as to the Trust Estate.

     (a) On the Closing Date, the Issuer shall furnish to the Indenture Trustee
and any Counterparties an Opinion of Counsel either stating that, in the opinion
of such counsel, such action has been taken with respect to the recording and
filing of this Indenture, any Supplemental Indentures hereto, and any other
requisite documents, and with respect to the execution and filing of any
financing statements and continuation statements, as are necessary to perfect
and make effective the lien and security interest of this Indenture and reciting
the details of such action, or stating that, in the opinion of such counsel, no
such action is necessary to make such lien and security interest effective.

     (b) On or before March 31, in each calendar year, beginning in 2003, the
Issuer shall furnish to the Indenture Trustee and any Counterparties an Opinion
of Counsel either stating that, in the opinion of such counsel, such action has
been taken with respect to the recording, filing, re-recording and refiling of
this Indenture, any Supplemental Indentures hereto and any other requisite
documents and with respect to the execution and filing of any financing
statements and continuation statements as are necessary to maintain the lien and
security interest created by this Indenture and reciting the details of such
action, or stating that in the opinion of


                                       12

<PAGE>

such counsel no such action is necessary to maintain such lien and security
interest. Such Opinion of Counsel shall also describe the recording, filing,
re-recording and refiling of this Indenture, any Supplemental Indentures hereto
and any other requisite documents and the execution and filing of any financing
statements and continuation statements that will, in the opinion of such
counsel, be required to maintain the lien and security interest of this
Indenture until March 31 of the following calendar year.

     Section 3.10 Appointment of Agents, Etc. The Issuer shall employ and
appoint all employees, agents, consultants and attorneys that it may consider
necessary.

     Section 3.11 Capacity to Sue. The Issuer shall have the power and capacity
to sue and to be sued on matters arising out of or relating to the financing of
the Financed Student Loans.

     Section 3.12 Continued Existence; Successor to Issuer. The Issuer agrees
that it will do or cause to be done all things necessary to preserve and keep in
full force and effect its existence, rights and franchises as a Delaware
business trust, except as otherwise permitted by this Section 3.12. The Issuer
further agrees that it will not (a) sell, transfer or otherwise dispose of all
or substantially all of its assets (except Financed Student Loans if such sale,
transfer or disposition will discharge this Indenture in accordance with Article
IX hereof); (b) consolidate with or merge into another entity; or (c) permit one
or more other corporations or entities to consolidate with or merge into it. The
preceding restrictions in (a), (b) and (c) shall not apply to a transaction if
(x) the transferee or the surviving or resulting corporation or entity, if other
than the Issuer, by proper written instrument for the benefit of the Indenture
Trustee, irrevocably and unconditionally assumes the obligation to perform and
observe the agreements and obligations of the Issuer under this Indenture, and
(y) the Issuer has received a Rating Confirmation regarding such transaction.

     If a transfer is made as provided in this Section 3.12, the provisions of
this Section 3.12 shall continue in full force and effect and no further
transfer shall be made except in compliance with the provisions of this Section
3.12.

     Section 3.13 Amendment of Transfer and Sale Agreements. The Issuer shall
notify the Indenture Trustee in writing of any proposed amendments to the
Transfer and Sale Agreements. No such amendment shall become effective unless
and until the Indenture Trustee consents thereto in writing. The consent of the
Indenture Trustee shall not be unreasonably withheld and shall not be withheld
if the Indenture Trustee receives an Opinion of Counsel acceptable to it that
such an amendment is required by the Act and is not materially prejudicial to
the Noteholders. Notwithstanding the foregoing, however, the Indenture Trustee
shall consent to any amendment from time to time so long as it is not materially
prejudicial to the interests of the Noteholders, and the Indenture Trustee may
rely on an Opinion of Counsel to such effect. The Indenture Trustee shall not be
required to execute any amendment that affects its rights, duties, immunities or
indemnities.

     Section 3.14 Representations; Negative Covenants.


                                       13

<PAGE>

     (a)    The Issuer hereby makes the following representations and warranties
to the Indenture Trustee on which the Indenture Trustee relies in authenticating
the Notes and on which the Noteholders have relied in purchasing the Notes. Such
representations and warranties shall survive the grant of the Trust Estate to
the Indenture Trustee pursuant to this Indenture.

     (i)    Organization and Good Standing. The Issuer is duly formed and
   validly existing under the laws of Delaware, and has the power to own its
   assets and to transact the business in which it presently engages.

     (ii)   Due Qualification. The Issuer is duly qualified to do business and
   is in good standing, and has obtained all material necessary licenses and
   approvals, in all jurisdictions where the failure to be so qualified, have
   such good standing or have such licenses or approvals would have a material
   adverse effect on the Issuer's business and operations or in which the
   actions as required by this Indenture require or will require such
   qualification.

     (iii)  Authorization. The Issuer has the power, authority and legal right
   to execute, deliver and perform this Indenture and to grant the Trust
   Estate to the Indenture Trustee, and the execution, delivery and
   performance of this Indenture and grant of the Trust Estate to the
   Indenture Trustee have been duly authorized by the Issuer.

     (iv)   Binding Obligation. This Indenture, assuming due authorization,
   execution and delivery by the Indenture Trustee, constitutes a legal, valid
   and binding obligation of the Issuer enforceable against the Issuer in
   accordance with its terms, except that (A) such enforcement may be subject to
   bankruptcy, insolvency, reorganization, moratorium or other similar laws
   (whether statutory, regulatory or decisional) now or hereafter in effect
   relating to creditors' rights generally and (B) the remedy of specific
   performance and injunctive and other forms of equitable relief may be subject
   to certain equitable defenses and to the discretion of the court before which
   any proceeding therefor may be brought, whether a proceeding at law or in
   equity.

     (v)    No Violation. The consummation of the transactions contemplated by
   this Indenture and the fulfillment of the terms hereof does not conflict
   with, result in any breach of any of the terms and provisions of or
   constitute (with or without notice, lapse of time or both) a default under
   the organizational documents of the Issuer, or any material indenture,
   agreement, mortgage, deed of trust or other instrument to which the Issuer
   is a party or by which it is bound, or result in the creation or imposition
   of any lien upon any of its material properties pursuant to the terms of
   any such indenture, agreement, mortgage, deed of trust or other instrument,
   other than this Indenture, nor violate any law or any order, rule or
   regulation applicable to the Issuer of any court or of any federal or state
   regulatory body, administrative agency, or other governmental
   instrumentality having jurisdiction over the Issuer or any of its
   properties.

     (vi)   No Proceedings. There are no proceedings, injunctions, writs,
   restraining orders or investigations to which the Issuer or any of its
   affiliates is a party pending, or, to the best of the Issuer's knowledge,
   threatened, before any court, regulatory body, administrative agency, or
   other tribunal or governmental instrumentality (A) asserting the


                                       14

<PAGE>

   invalidity of this Indenture, (B) seeking to prevent the issuance of any
   Notes or the consummation of any of the transactions contemplated by this
   Indenture or (C) seeking any determination or ruling that might materially
   and adversely affect the performance by the Issuer of its obligations
   under, or the validity or enforceability of this Indenture.

     (vii)  Approvals. All approvals, authorizations, consents, orders or other
   actions of any person, corporation or other organization, or of any court,
   governmental agency or body or official, required on the part of the Issuer
   in connection with the execution and delivery of this Indenture have been
   taken or obtained on or prior to the Date of Issuance.

     (viii) Place of Business. The Issuer's place of business and office is
   located at the Corporate Trust Office of the Co-Owner Trustee.

     (ix)   Taxes. The Issuer has filed (or caused to be filed) all federal,
   state, county, local and foreign income, franchise and other tax returns
   required to be filed by it through the date hereof, and has paid all taxes
   reflected as due thereon. There is no pending dispute with any taxing
   authority that, if determined adversely to the Issuer, would result in the
   assertion by any taxing authority of any material tax deficiency, and the
   Issuer has no knowledge of a proposed liability for any tax year to be
   imposed upon its properties or assets for which there is not an adequate
   reserve reflected in its current financial statements.

     (x)    Legal Name. The legal name of the Issuer is "Education Funding
   Capital Trust-I" and has not changed since its formation. The Issuer has no
   tradenames, fictitious names, assumed names or "dba's" under which it
   conducts its business and has made no filing in respect of any such name.

     (xi)   Business Purpose. The Issuer has acquired the Financed Student Loans
   conveyed to it under the Depositor Transfer and Sale Agreement for a bona
   fide business purpose and has undertaken the transactions contemplated herein
   as principal rather than as an agent of any other person. The Issuer has
   adopted and operated consistently with all formalities with respect to its
   operations and has engaged in no other activities other than those specified
   in this Indenture and the Depositor Transfer and Sale Agreement and in
   accordance with the transactions contemplated herein and therein.

     (xii)  Compliance With Laws. The Issuer is in compliance with all
   applicable laws and regulations with respect to the conduct of its business
   and has obtained and maintains all permits, licenses and other approvals as
   are necessary for the conduct of its operations.

     (xiii) Valid Business Reasons; No Fraudulent Transfers. The transactions
   contemplated by this Indenture are in the ordinary course of the Issuer's
   business and the Issuer has valid business reasons for granting the Trust
   Estate pursuant to this Indenture. At the time of each such grant: (A) the
   Issuer granted the Trust Estate to the Indenture Trustee without any intent
   to hinder, delay, or defraud any current or future creditor of the Issuer;
   (B) the Issuer was not insolvent and did not become insolvent as a result of
   any such grant; (C) the Issuer was not engaged and was not about to engage in
   any


                                       15

<PAGE>

   business or transaction for which any property remaining with it was an
   unreasonably small capital or for which the remaining assets of it are
   unreasonably small in relation to its business or the transaction; (D) the
   Issuer did not intend to incur, and did not believe or should not have
   reasonably believed, that it would incur, debts beyond its ability to pay
   as they become due; and (E) the consideration received by the Issuer for
   the grant of the Trust Estate was reasonably equivalent to the value of the
   related grant.

     (xiv)   No Management of Affairs of Depositor. The Issuer is not and will
   not be involved in the day-to-day management of the Depositor.

     (xv)    Ability to Perform. There has been no material impairment in the
   ability of the Issuer to perform its obligations under this Indenture.

     (xvi)   Financial Condition. No material adverse change has occurred in the
   Issuer's financial status since the date of its formation.

     (xvii)  Event of Default. No Event of Default has occurred and no event has
   occurred that, with the giving of notice, the passage of time, or both, would
   become an Event of Default.

     (xviii) Acquisition of Financed Student Loans Legal. The Issuer has
   complied with all applicable federal, state and local laws and regulations in
   connection with its acquisition of the Financed Student Loans from the
   Depositor.

     (xix)   No Material Misstatements or Omissions. No information, certificate
   of an officer, statement furnished in writing or report delivered to the
   Indenture Trustee, the Servicer or any Noteholder by the Issuer contains any
   untrue statement of a material fact or omits a material fact necessary to
   make such information, certificate, statement or report not misleading.

     (b)     The Issuer will not:

     (i)     sell, transfer, exchange or otherwise dispose of any portion of the
   Trust Estate except as expressly permitted by this Indenture;

     (ii)    claim any credit on, or make any deduction from, the principal
   amount of any of the Notes by reason of the payment of any taxes levied or
   assessed upon any portion of the Trust Estate;

     (iii)   except as otherwise provided herein, dissolve or liquidate in whole
   or in part, except with the prior written consent of the Indenture Trustee,
   and to the extent Notes remain Outstanding, approval of the Noteholders and a
   Rating Confirmation;

     (iv)    permit the validity or effectiveness of this Indenture, any
   Supplemental Indenture or any grant hereunder to be impaired, or permit the
   lien of this Indenture to be amended, hypothecated, subordinated, terminated
   or discharged, or permit any Person to be released from any covenants or
   obligations under this Indenture, except as may be expressly permitted
   hereby;


                                       16

<PAGE>

     (v)    except as otherwise provided herein, permit any lien, charge,
   security interest, mortgage or other encumbrance (other than the lien of
   this Indenture) to be created on or extend to or otherwise arise upon or
   burden the Trust Estate or any part thereof or any interest therein or the
   proceeds thereof;

     (vi)   permit the lien of this Indenture not to constitute a valid first
   priority, perfected security interest in the Trust Estate;

     (vii)  incur or assume any indebtedness or guarantee any indebtedness of
   any Person whether secured by any Financed Student Loans under this
   Indenture or otherwise, except for such obligations as may be incurred by
   the Issuer in connection with the issuance of the Notes pursuant to this
   Indenture and unsecured trade payables in the ordinary course of its
   business;

     (viii) operate such that it would be consolidated with any affiliate and
   its separate existence disregarded in any federal or state proceeding;

     (ix)   act as agent of the Depositor or allow the Depositor to act as its
   agent;

     (x)    allow the Depositor or any other affiliate to pay its expenses,
   guarantee its obligations or advance funds to it for payment of expenses; or

     (xi)   consent to the appointment of a conservator or receiver or
   liquidator in any insolvency, readjustment of debt, marshalling of assets
   and liabilities, voluntary liquidation or similar proceedings of or
   relating to the Issuer or of or relating to all or substantially all of its
   property, or admit in writing its inability to pay its debts generally as
   they become due, file a petition to take advantage of any applicable
   insolvency, bankruptcy or reorganization statute, make an assignment for
   the benefit of its creditors or voluntarily suspend payment of its
   obligations.

     (c)    The Issuer makes the following representations and warranties as to
the Trust Estate granted to the Indenture Trustee hereunder on which the
Indenture Trustee relies in accepting the Trust Estate. Such representations and
warranties shall survive the grant of the Trust Estate to the Indenture Trustee
pursuant to this Indenture.

     (i)    Financed Student Loans. Notwithstanding the definition of "Student
   Loans" herein, the Issuer covenants not to acquire Student Loans delinquent
   by more than 90 days.

     (ii)   Schedule of Financed Student Loans. The information set forth in
   each Schedule of Financed Student Loans is true and correct in all material
   respects as of the opening of business on the Date of Issuance.

     (iii)  Grant. It is the intention of the Issuer that the transfer herein
   contemplated constitutes a grant of the Financed Student Loans to the
   Indenture Trustee.

     (iv)   All Filings Made. All filings (including, without limitation, UCC
   filings) necessary in any jurisdiction to give the Indenture Trustee a first
   priority perfected


                                       17

<PAGE>

   ownership and security interest in the Trust Estate, including the Financed
   Student Loans, have been made no later than the Date of Issuance and copies
   of the file-stamped financing statements shall be delivered to the
   Indenture Trustee within 5 Business Days of receipt by the Issuer or its
   agent from the appropriate secretary of state. The Issuer has not caused,
   suffered or permitted any lien, pledges, offsets, defenses, claims,
   counterclaims, charges or security interest with respect to the promissory
   notes relating to the Financed Student Loans (other than the security
   interest created in favor of the Indenture Trustee) to be created.

     (v)    Transfer Not Subject to Bulk Transfer Act. Each grant of the
   Financed Student Loans by the Issuer pursuant to this Indenture is not
   subject to the bulk transfer act or any similar statutory provisions in
   effect in any applicable jurisdiction.

     (vi)   No Transfer Taxes Due. Each grant of the Financed Student Loans
   (including all payments due or to become due thereunder) by the Issuer
   pursuant to this Indenture is not subject to and will not result in any tax,
   fee or governmental charge payable by the Issuer or the Depositor to any
   federal, state or local government.

     Section 3.15 Additional Covenants. So long as any of the Notes are
Outstanding:

     (a)    The Issuer shall not engage in any business or activity other than
in connection with the activities contemplated hereby and in the Transfer and
Sale Agreements, and in connection with the issuance of Notes.

     (b)    The Issuer shall not consolidate or merge with or into any other
entity or convey or transfer its properties and assets substantially as an
entirety to any entity except as otherwise provided herein.

     (c)    The funds and other assets of the Issuer shall not be commingled
with those of any other individual, corporation, estate, partnership, joint
venture, association, joint stock company, trust, unincorporated organization,
or government or any agency or political subdivision thereof.

     (d)    The Issuer shall not be, become or hold itself out as being liable
for the debts of any other party.

     (e)    The Issuer shall act solely in its own name and through its duly
Authorized Officers in the conduct of its business, and shall conduct its
business so as not to mislead others as to the identity of the entity with which
they are concerned.

     (f)    The Issuer shall maintain its records and books of account and shall
not commingle its records and books of account with the records and books of
account of any other Person. The books of the Issuer may be kept (subject to any
provision contained in the statutes) inside or outside of Delaware at such place
or places as may be designated from time to time by the Issuer.

     (g)    All actions of the Issuer shall be taken by a duly Authorized
Officer or agent of the Issuer.


                                       18

<PAGE>

     (h)    The Issuer shall not amend, alter, change or repeal any provision
contained in this Section 3.15 without (i) the prior written consent of the
Indenture Trustee and (ii) a Rating Confirmation (a copy of which shall be
provided to the Indenture Trustee).

     (i)    The Issuer shall not amend the Trust Agreement without first
obtaining the prior written consent of each Rating Agency.

     (j)    All audited financial statements of the Issuer that are consolidated
with those of any affiliate thereof will contain detailed notes clearly stating
that (i) all of the Issuer's assets are owned by the Issuer, and (ii) the Issuer
is a separate entity with creditors who have received ownership and/or security
interests in the Issuer's assets.

     (k)    The Issuer will strictly observe legal formalities in its dealings
with the Depositor or any affiliate thereof, and funds or other assets of the
Issuer will not be commingled with those of the Depositor or any other affiliate
thereof. The Issuer shall not maintain joint bank accounts or other depository
accounts to which the Depositor or any other affiliate has independent access.
None of the Issuer's funds will at any time be pooled with any funds of the
Depositor or any other affiliate.

     (l)    The Issuer will maintain an arm's length relationship with the
Depositor (and any affiliate). Any Person that renders or otherwise furnishes
services to the Issuer will be compensated by the Issuer at market rates for
such services except as otherwise provided in this Indenture. Except as
contemplated in this Indenture, the Transfer and Sale Agreements, the Issuer
will not hold itself out to be responsible for the debts of the Depositor or the
decisions or actions respecting the daily business and affairs of the Depositor.

     Section 3.16 Providing of Notice. The Issuer, upon learning of any failure
on its part to observe or perform in any material respect any covenant,
representation or warranty of the Issuer set forth in this Indenture or the
Depositor Transfer and Sale Agreement, or of any failure on the part of the
Depositor to observe or perform in any material respect any covenant,
representation or warranty of the Depositor set forth in the Transfer and Sale
Agreements, shall promptly notify the Indenture Trustee, the Servicer and each
Rating Agency of such failure.

     Section 3.17 Reports by Issuer. At such time as the Notes are registered
with the Commission, the Issuer shall:

     (a)    file with the Indenture Trustee, within 15 days after the Issuer is
required to file the same with the Commission, copies of the annual reports and
of the information, documents and other reports (or copies of such portions of
any of the foregoing as the Commission may from time to time by rules and
regulations prescribe) that the Issuer may be required to file with the
Commission pursuant to Section 13 or Section 15(d) of the Securities Exchange
Act;

     (b)    file with the Indenture Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the Commission, such
additional information, documents and reports with respect to compliance by the
Issuer with the conditions and covenants of this Indenture as may be required
from time to time by such rules and regulations; and (c) transmit by mail to the
Noteholders, within 30 days after the filing thereof


                                       19

<PAGE>

with the Indenture Trustee, in the manner and to the extent provided in TIA
Section 313(c), such summaries of any information, documents and reports
required to be filed by the Issuer pursuant to clauses (a) and (b) of this
Section 3.17 as may be required by rules and regulations prescribed from time to
time by the Commission.

     Section 3.18 Statement as to Compliance. The Issuer will deliver to the
Indenture Trustee, within 120 days after the end of each Fiscal Year, a brief
certificate from an Authorized Officer as to his or her knowledge of the
Issuer's compliance with all conditions and covenants under this Indenture and,
in the event of any noncompliance, specifying such noncompliance and the nature
and status thereof. For purposes of this Section 3.18, such compliance shall be
determined without regard to any period of grace or requirement of notice under
this Indenture.

     Section 3.19 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee. The Issuer covenants that if:

     (a)    default is made in the payment of any installment of interest, if
any, on any Notes when such interest becomes due and payable; or

     (b)    default is made in the payment of the principal of and premium, if
any, on any Notes at their Maturity,

     then the Issuer will, upon demand of the Indenture Trustee, pay to the
Indenture Trustee, for the benefit of the Noteholders, the whole amount then due
and payable on such Notes for principal and premium, if any, and interest, with
interest upon any overdue principal and premium, if any, and, to the extent that
payment of such interest shall be legally enforceable, upon any overdue
installments of interest, if any, at the rate or rates borne by or provided for
in such Notes, and, in addition thereto, such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and its agents and counsel.

     If the Issuer fails to pay such amounts forthwith upon such demand, the
Indenture Trustee, in its own name and as Indenture Trustee of an express trust,
may institute a judicial proceeding for the collection of the sums so due and
unpaid, may prosecute such proceeding to judgment or final decree, and may
enforce the same against the Issuer or any other obligor upon such Notes of such
Series and collect the moneys adjudged or decreed to be payable in the manner
provided by law out of the property of the Issuer or any other obligor upon such
Notes, wherever situated.

     If an Event of Default with respect to Notes occurs and is continuing of
which a Responsible Officer has actual knowledge, the Indenture Trustee may,
after being indemnified to its satisfaction and in its discretion, proceed to
protect and enforce its rights and the rights of the Noteholders by such
appropriate judicial proceedings as the Indenture Trustee shall deem appropriate
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.


                                       20

<PAGE>

     Section 3.20 Representations of the Issuer Regarding the Indenture
Trustee's Security Interest. The Issuer hereby represents and warrants for the
benefit of the Indenture Trustee and the Noteholders as follows:

     (a)    This Indenture creates a valid and continuing security interest (as
defined in the applicable Uniform Commercial Code in effect in the State of
Delaware) in the Financed Student Loans in favor of the Indenture Trustee, which
security interest is prior to all other liens, charges, security interests,
mortgages or other encumbrances, and is enforceable as such as against creditors
of and purchasers from Issuer.

     (b)    The Financed Student Loans constitute either "general intangibles"
or "instruments" within the meaning of the applicable UCC.

     (c)    The Issuer owns and has good and marketable title to the Financed
Student Loans free and clear of any lien, charge, security interest, mortgage or
other encumbrance, claim or encumbrance of any Person.

     (d)    The Issuer has caused or will have caused, within 10 days, the
filing of all appropriate financing statements in the proper filing office in
the appropriate jurisdictions under applicable law in order to perfect the
security interest in the Financed Student Loans granted to the Indenture Trustee
hereunder.

     (e)    All executed copies of each promissory note that constitute or
evidence the Financed Student Loans have been delivered to either the Indenture
Trustee or the Custodian.

     (f)    The Issuer has received a written acknowledgment from each Custodian
that such Custodian is holding the promissory notes that constitute or evidence
the Financed Student Loans solely on behalf and for the benefit of the Indenture
Trustee.

     (g)    Other than the security interest granted to the Indenture Trustee
pursuant to this Indenture, the Issuer has not pledged, assigned, sold, granted
a security interest in, or otherwise conveyed any of the Financed Student Loans;
the Issuer has not authorized the filing of and is not aware of any financing
statements against the Issuer that include a description of collateral covering
the Financed Student Loans other than any financing statement relating to the
security interest granted to the Indenture Trustee hereunder or that has been
terminated; and the Issuer is not aware of any judgment or tax lien filings
against Issuer.

     The representations and warranties set forth in this Section 3.20 shall
survive the termination of this Indenture. The Indenture Trustee shall not waive
any of the representations and warranties set forth in this Section 3.20.

     Section 3.21 Covenants of the Issuer Regarding the Indenture Trustee's
Security Interest. The Issuer hereby covenants for the benefit of the Indenture
Trustee and the Noteholders that the Issuer shall take all steps necessary, and
shall cause the Servicers to take all steps necessary and appropriate, to
maintain the perfection and priority of the Indenture Trustee's security
interest in the Financed Student Loans.

     Section 3.22 Certain Tax Forms and Treatment.


                                       21

<PAGE>

     (a)    Each Noteholder and any beneficial owner of a Note, if required by
law, shall timely furnish the Issuer or its agents any U.S. federal income tax
form or certification (such as IRS Form W-8BEN (Certification of Foreign Status
as Beneficial Owner), Form W-8IMY (Certification of Foreign Intermediary Status)
with all appropriate attachments, IRS Form W-9 (Request for Taxpayer
Identification Number and Certification), or IRS Form W-8ECI (Certification of
Foreign Person's Claim for Exemption from Withholding on Income Effectively
Connected with Conduct of a U.S. Trade or Business) or any successors to such
IRS forms) that the Issuer or its agents may reasonably request and shall update
or replace such form or certification in accordance with its terms or its
subsequent amendments. The Noteholder understands that the Issuer may require
certification acceptable to it (a) to permit the Issuer to make payments to it
without, or at a reduced rate of, withholding or (b) to enable the Issuer to
qualify for a reduced rate of withholding or back-up withholding in any
jurisdiction from or through which the Issuer receives payments on its assets.
The Noteholder agrees to provide any such certification that is requested by the
Issuer.

     (b)    The Issuer, the Co-Owner Trustee, the Depositor, the Indenture
Trustee and each Noteholder of Senior Notes and Subordinated Notes agree to
treat such Notes as indebtedness for U.S. federal, state and local income and
franchise tax purposes and further agree not to take any action inconsistent
with such treatment, unless required by law.

     (c)    None of the Issuer, the Depositor, or the Indenture Trustee shall
cause the Issuer to be treated as a separate entity that is an association
taxable as a corporation for U.S. federal income tax purposes.

     (d)    The Administrator shall on behalf of the Issuer prepare, execute and
timely file (or cause to be prepared, appropriately executed and timely filed)
all federal, state and local tax and information returns, reports, information,
statements and schedules required to be filed by or in respect of the Issuer, in
accordance with this Indenture and as may be required under applicable tax laws.

     (e)    The Issuer intends to treat the transactions contemplated by the
Depositor Transfer and Sale Agreement as an absolute transfer, and not a pledge,
of the Financed Student Loans from the Depositor for financial accounting
purposes. The Issuer and the Depositor intend to treat the Notes as indebtedness
of the Depositor (or, if both the Issuer and the Depositor are "disregarded
entities," of the sole owner of the Depositor) and the Issuer assets as assets
owned by the Depositor (or, if both the Issuer and the Depositor are
"disregarded entities," of the sole owner of the Depositor) for U.S. federal
income tax purposes.

                                   Article IV

                                      Funds

     Section 4.01 Creation and Continuation of Funds and Accounts.

     (a)    There are hereby created and established the following Funds and
Accounts to be held and maintained by the Indenture Trustee for the benefit of
the Noteholders:

     (i)    Acquisition Fund;


                                       22

<PAGE>

     (ii)   Revenue Fund;

     (iii)  Interest Fund (including therein a Class A Account and a Class B
Account);

     (iv)   Principal Fund (including therein a Class A Account and a Class B
Account);

     (v)    Reserve Fund; and

     (vi)   Capitalized Interest Fund.

     (b)    The Operating Fund will be established separately by the Issuer, and
will not constitute a Fund within the meaning of this Indenture, and is held by
a depository bank of the Issuer for the benefit of the Issuer; and the
Noteholders shall have no right, title or interest therein.

     The Indenture Trustee is hereby authorized for the purpose of facilitating
the administration of the Trust Estate and for the administration of any Notes
issued hereunder to create further Accounts or Subaccounts in any of the various
Funds and Accounts established hereunder that are deemed necessary or desirable.

     Section 4.02 Acquisition Fund. There shall be deposited into the
Acquisition Fund moneys from proceeds of any Notes. Financed Student Loans shall
be held by the Indenture Trustee or its agent or bailee and shall be pledged to
the Trust Estate and accounted for as a part of the Acquisition Fund.

     Moneys on deposit in the Acquisition Fund shall be used, upon Issuer Order,
solely to pay costs of issuance of the Notes, to redeem Notes in accordance with
the provisions of any Supplemental Indenture, and, upon receipt by the Indenture
Trustee of a Student Loan Acquisition Certificate, to acquire Student Loans at a
price that would permit the results of the Cash Flows provided to each Rating
Agency on any Date of Issuance to be sustained as certified to the Indenture
Trustee on the Student Loan Acquisition Certificate; provided that such price
may be increased if Rating Confirmation is obtained, based on new Cash Flows
containing such assumptions as the Issuer shall reasonably determine.

     No amounts shall be transferred from the Acquisition Fund to acquire or
originate Student Loans having characteristics that are materially and adversely
different from the characteristics of the Financed Student Loans shown in the
most recent Cash Flows provided to the Rating Agencies, which characteristics
include but are not limited to loan type, federal benefits, applicable borrower
benefit programs, and provisions and servicing of such Financed Student Loans
required by the Act as amended through the date hereof, unless the Issuer first
obtains a Rating Confirmation.

     Any such Issuer Order or Student Loan Acquisition Certificate shall state
that such proposed use of moneys in the Acquisition Fund is in compliance with
the provisions of this Indenture. If the Issuer determines that all or any
portion of such moneys cannot be so used, then


                                       23

<PAGE>

an Authorized Officer of the Issuer may, by Issuer Order, direct the Indenture
Trustee to redeem Notes in accordance with any Supplemental Indenture.

     Notwithstanding the foregoing, if on any Payment Date there are not
sufficient moneys on deposit in the Interest Fund, the Principal Fund or the
Capitalized Interest Fund to make the transfers required by Section 4.03(b)(i)
through (iv) hereof, then an amount equal to any such deficiency may, upon
Issuer Order, be transferred directly from the Acquisition Fund.

     While the Issuer will be the beneficial owner of Financed Student Loans
that were originated under the Act and the Noteholders will have a security
interest therein, it is understood and agreed that the Trust Eligible Lender
Trustee will be the legal owner thereof and the Indenture Trustee will have a
security interest in such Financed Student Loans for and on behalf of the
Noteholders. The notes representing Financed Student Loans that were originated
under the Act will be held in the name of the Trust Eligible Lender Trustee for
the account of the Issuer, for the benefit of the Noteholders.

     Section 4.03 Revenue Fund.

     (a)    The Indenture Trustee shall deposit into the Revenue Fund all
Revenues derived from Financed Student Loans acquired by the Issuer, all other
Revenue derived from moneys or assets on deposit in the Acquisition Fund, the
Interest Fund, the Principal Fund and the Reserve Fund, all Counterparty
Derivative Payments, moneys transferred from the Acquisition Fund or Capitalized
Interest Fund as provided herein, and any other amounts to be deposited therein
pursuant to and upon receipt of an Issuer Order. Upon receipt of an Issuer Order
substantially in the form of Exhibit B hereto, directing the same, moneys in the
Revenue Fund shall be used, on any date, to make a transfer to the Operating
Fund to pay Program Expenses, subject to Section 4.07 hereof.

     (b)    On the last Business Day of each month, money remaining in the
Revenue Fund shall be used and transferred to other funds or Persons in the
following order of precedence, or as otherwise specified in a Supplemental
Indenture (any money not so transferred or paid to remain in the Revenue Fund
until subsequently applied pursuant to this Section 4.03(b)):

     (i)    to the Class A Account of the Interest Fund, after giving effect to
   any money already on deposit in the Class A Account of the Interest Fund
   for such purposes, the amount necessary to pay (a) the interest payments
   due in the next succeeding month in respect of each Series of Senior Notes
   for which a Payment Date will occur in that month; provided, however, that
   if the interest rate on such Series of Senior Notes is unknown, the amount
   to be transferred shall be calculated using the last known interest rate
   for such Series, (b) the interest to accrue during the next succeeding
   month in respect of each Series of Senior Notes for which a Payment Date
   will not occur in that month, and (c) any Issuer Derivative Payments due in
   the next succeeding month in respect of any Derivative Product secured on a
   parity with the Senior Notes;

     (ii)   to the Class A Account of the Principal Fund, after giving effect to
   any money already on deposit in the Class A Account of the Principal Fund for
   such purpose,


                                       24

<PAGE>

   the amount necessary to pay the principal of and premium, if any, on each
   Series of Senior Notes due at Stated Maturity in the next succeeding month;

     (iii)  to the Class B Account of the Interest Fund, after giving effect to
   any money already on deposit in the Class B Account of the Interest Fund for
   such purposes, the amount necessary to pay (a) the interest payments due in
   the next succeeding month in respect of each Series of Subordinate Notes for
   which a Payment Date will occur in that month; provided, however, that if the
   interest rate on such Series of Subordinate Notes is unknown, the amount to
   be transferred shall be calculated using the last known interest rate for
   such Series, (b) the interest to accrue during the next succeeding month in
   respect of each Series of Subordinate Notes for which a Payment Date will not
   occur in that month, and (c) any Issuer Derivative Payments due in the next
   succeeding month in respect of any Derivative Product secured on a parity
   with the Subordinate Notes;

     (iv)   to the Class B Account of the Principal Fund, after giving effect to
   any money already on deposit in the Class B Account of the Principal Fund for
   such purpose, the amount necessary to pay the principal of and premium, if
   any, on any Subordinate Notes due at Stated Maturity in the next succeeding
   month;

     (v)    to the Reserve Fund the amount, if any, required by Section 4.06(d)
   hereof;

     (vi)   if the Parity Percentage is not at least equal to the Required
   Parity Percentage, to the Class A Account of the Principal Fund, after
   giving effect to any money already on deposit in the Class A Account of the
   Principal Fund for such purposes, the amount necessary to pay the principal
   of and premium, if any, on Senior Notes for which an interest Payment Date
   will occur in the next succeeding month, or if no Senior Notes are
   Outstanding, to the Class B Account of the Principal Fund the amount
   necessary to pay principal of and premium, if any, on Subordinate Notes for
   which an interest Payment Date will occur in the next succeeding month;
   provided, however, that during any Revolving Period, at the direction of
   the Issuer, amounts remaining in the Revenue Fund after payment of all
   amounts required by (i) through (v) of this Section 4.03(b) may be used for
   the acquisition or origination of other Student Loans and, provided,
   further, at the direction of the Issuer, such excess amounts may also be
   used to acquire Add-on Consolidation Loans originated within 180 days of
   the origination of the related Consolidation Loan;

     (vii)  to the Class B Account of the Principal Fund, after giving effect to
   any money already on deposit in the Class B Account of the Principal Fund for
   such purpose, from amounts representing Recoveries of Principal, the amount
   necessary to pay principal of and premium, if any, on Subordinate Notes in
   respect of which an interest Payment Date will occur in the next succeeding
   month to the extent that after such payment the Senior Parity Percentage
   shall not be less than the Required Senior Parity Percentage; otherwise to
   the Class A Account of the Principal Fund to pay principal and premium, if
   any, on Senior Notes in respect of which an interest Payment Date will occur
   in the next succeeding month;


                                       25

<PAGE>

     (viii) to the Class A Account of the Interest Fund, after giving effect to
   any money already on deposit in the Class A Account of the Interest Fund for
   such purpose, the amount necessary to pay interest accrued on the interest
   carryover amounts of the Senior Notes and the interest carryover amounts of
   the Senior Notes, and to the Class B Account of the Interest Fund, after
   giving effect to any money already on deposit in the Class B Account of the
   Interest Fund for such purpose, the amount necessary to pay interest accrued
   on the interest carryover amounts of the Subordinate Notes and the interest
   carryover amounts of the Subordinate Notes, in that order of priority;
   provided, however, on any Payment Date, any such amount shall be allocated
   first to any Notes being redeemed on such Payment Date; and

     (ix)   to the Co-Owner Trustee for deposit into the Certificate
   Distribution Account (as defined in the Trust Agreement) if after giving
   effect to the transfer to the Co-Owner Trustee the Parity Percentage is at
   least equal to the Required Parity Percentage and the Senior Parity
   Percentage is at least equal to the Required Senior Parity Percentage; if
   these parity requirements are not met, then any remainder shall be retained
   in the Revenue Fund; provided, however, that during any period commencing
   after June 1, 2022, moneys will be transferred to the Co-Owner Trustee
   pursuant to this subsection (ix) only upon receipt of a Rating Confirmation
   with respect to transfers during that period, otherwise moneys remaining in
   the Revenue Fund after payment of all amounts required by (i) through
   (viii) of this Section 4.03(b) shall be transferred to the Principal Fund.

     All payments of principal on the Notes shall be made by redemption of the
Notes unless otherwise directed in a Supplemental Indenture.

     (c)    As long as any Senior Notes remain Outstanding, the above payment
   order will be modified if, after giving effect to the payments on any
   Payment Date, a payment Event of Default has occurred under this Indenture
   (in which event amounts will be applied as provided herein with respect to
   Events of Default).

     In such event, the Subordinate Notes shall not receive any payments of
interest or principal and Issuer Derivative Payments that are secured on a
parity with the Subordinate Notes shall not be made. Any such deferral of
payments on the Subordinate Notes shall not constitute an Event of Default under
this Indenture.

     Section 4.04 Interest Fund.

     (a)    On the last Business Day of each month, the Indenture Trustee shall
transfer to the Class A Account of the Interest Fund from the Revenue Fund
amounts necessary to make the transfers required by Section 4.03(b)(i) hereof.
During the next succeeding month, the Indenture Trustee shall use moneys
transferred to the Class A Account of the Interest Fund pursuant to Section
4.03(b)(i) hereof for the payment, on a parity basis, of interest due on Senior
Notes for which an interest Payment Date will occur during that month and any
Issuer Derivative Payments due during that month on any Derivative Product
secured on a parity with such Senior Notes. Also during that month, the
Indenture Trustee shall use moneys transferred to the Class A Account of the
Interest Fund pursuant to Section 4.03(b)(viii) to pay interest accrued on the


                                       26

<PAGE>

interest carryover amounts of Senior Notes for which an interest Payment Date
will occur during that month and the interest carryover amounts of such Senior
Notes.

     (b)    On the last Business Day of each month, the Indenture Trustee shall
transfer to the Class B Account of the Interest Fund from the Revenue Fund
amounts necessary to make the transfers required by Section 4.03(b)(iii) hereof.
During the next succeeding month, the Indenture Trustee shall use moneys
transferred to the Class B Account of the Interest Fund pursuant to Section
4.03(b)(iii) hereof for the payment, on a parity basis, of interest due on
Subordinate Notes for which an interest Payment Date will occur during that
month and any Issuer Derivative Payments due during that month on any Derivative
Product secured on a parity with such Subordinate Notes. Also during that month,
the Indenture Trustee shall use moneys transferred to the Class B Account of the
Interest Fund pursuant to Section 4.03(b)(viii) to pay interest accrued on the
interest carryover amounts of Subordinate Notes for which an interest Payment
Date will occur during that month and the interest carryover amounts of such
Subordinate Notes.

     (c)    If moneys sufficient to pay all interest due on the Senior Notes or
Subordinate Notes or any Issuer Derivative Payments due on any Derivative
Product secured on a parity with such Notes is not available in the related
Account of the Interest Fund on the first Business Day preceding the related
Note Payment Date or Derivative Payment Date, the Indenture Trustee shall
withdraw the amount of any such deficiency from moneys available in the
Capitalized Interest Fund or the Reserve Fund, in that order of priority.

     Section 4.05 Principal Fund.

     (a)    On the last Business Day of each month, the Indenture Trustee shall
transfer to the appropriate Account of the Principal Fund from the Revenue Fund
amounts necessary to make the transfers required by Section 4.03(b) hereof. The
Indenture Trustee shall use moneys in the Class A Account of the Principal Fund
for the payment of principal due on the Senior Notes, whether at their Stated
Maturity or upon redemption of such Notes. The Indenture Trustee shall use
moneys in the Class B Account of the Principal Fund for the payment of principal
due on the Subordinate Notes, whether at their Stated Maturity or upon
redemption of such Notes.

     (b)    If moneys sufficient to pay principal due on the Senior Notes or
Subordinate Notes at their Stated Maturity is not available in the related
Account of the Principal Fund on the first Business Day preceding their Stated
Maturity, the Indenture Trustee shall withdraw the amount of any such deficiency
from moneys available in the Reserve Fund.

     (c)    If the Parity Percentage is not at least equal to the Required
Parity Percentage on the last Business Day of any month, during the next
succeeding month the Indenture Trustee shall use moneys in the Class A Account
of the Principal Fund to pay the principal of and premium, if any, on Senior
Notes for which an interest Payment Date will occur in that month, or if no
Senior Notes are Outstanding, the Indenture Trustee shall use moneys in the
Class B Account of the Principal Fund to pay principal of and premium, if any,
on


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<PAGE>

Subordinate Notes for which an interest Payment Date will occur in that month,
until the Parity Percentage is at least equal to the Required Parity Percentage.

     (d)    On each Payment Date, the Indenture Trustee shall use moneys in the
Class B Account of the Principal Fund representing Recoveries of Principal to
pay principal of and premium, if any, on Subordinate Notes in respect of which
interest is due on that Payment Date, but only to the extent that, after such
payment the Senior Parity Percentage will not be less than the Required Senior
Parity Percentage; provided, however, if the Senior Parity Percentage is less
than the Required Senior Parity Percentage on that Payment Date, the Indenture
Trustee shall use moneys in the Class A Account of the Principal Fund
representing Recoveries of Principal to pay principal and premium, if any, on
Senior Notes in respect of which interest is due on that Payment Date.

     (e)    Moneys in the Principal Fund shall be used at the option of the
Issuer to redeem Notes in accordance with the Supplemental Indenture authorizing
the issuance of such Notes.

     Section 4.06 Reserve Fund.

     (a)    The Indenture Trustee shall deposit to the Reserve Fund the amount,
if any, specified in each Supplemental Indenture. On each Payment Date, to the
extent there are insufficient moneys in the Revenue Fund to make the transfers
required by Sections 4.03(b)(i) through (iv) hereof, the amount of such
deficiency shall be paid directly from the Reserve Fund if such deficiency has
not been paid from the Acquisition Fund or the Capitalized Interest Fund.

     (b)    Money in the Reserve Fund may be used to pay principal on the Notes
only on the date of their Stated Maturity.

     (c)    An amount specified in a Supplemental Indenture may be withdrawn
from the Reserve Fund, free from the lien of the Indenture on the dates
described therein.

     (d)    If the Reserve Fund is used for the purposes described in Section
4.06(a)-(c) hereof, the Indenture Trustee shall restore the Reserve Fund to the
Reserve Fund Requirement with respect thereto by transfers from the Revenue Fund
on the next Payment Date pursuant to Section 4.03(b)(v) hereof. If the full
amount required to restore the Reserve Fund to the applicable Reserve Fund
Requirement is not available in the Revenue Fund on such next succeeding Payment
Date, the Indenture Trustee shall continue to transfer funds from the Revenue
Fund as they become available and in accordance with Section 4.03(b)(v) hereof
until the deficiency in the Reserve Fund has been eliminated.

     (e)    On any day that the amount in the Reserve Fund exceeds the Reserve
Fund Requirement with respect thereto, the Indenture Trustee, at the direction
of the Issuer, shall transfer the excess to the Revenue Fund.

     (f)    On the date of redemption of all of the Notes, at the direction of
the Issuer, the Indenture Trustee shall transfer all moneys in the Reserve Fund
to the Revenue Fund.


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<PAGE>

     If at any time the balance in the Reserve Fund, together with other
available funds of the Issuer on deposit with the Indenture Trustee, shall be
sufficient to retire all Notes Outstanding, such balance may be applied at the
direction of the Issuer to retire all Notes Outstanding.

     Section 4.07 Operating Fund. The Indenture Trustee shall deposit to the
Operating Fund or transfer to an Eligible Deposit Account at the Issuer's
depository bank if not the Indenture Trustee, the amount, if any, specified in
each Supplemental Indenture. The Operating Fund is a special fund created with a
depository bank of the Issuer and shall be used to pay Program Expenses. The
Operating Fund shall be held by such depository bank of the Issuer, and no
Noteholder shall have any right, title or interest in the Operating Fund.
Amounts deposited in the Operating Fund shall be used to pay Program Expenses.

     The amount deposited in the Operating Fund by transfer from the Revenue
Fund and, if necessary, from the Acquisition Fund, and the schedule of deposits
shall be determined by the Issuer, but the amount so transferred in any one
Fiscal Year shall not exceed the amount budgeted by the Issuer as Program
Expenses for such Fiscal Year with respect to the Notes and as may be limited by
a Supplemental Indenture, and shall not exceed the amount designated therefor in
the Cash Flows provided to each Rating Agency on each Date of Issuance, unless
the Issuer, after furnishing each Rating Agency with revised Cash Flows, shall
have received a Rating Confirmation. The Issuer shall provide the Indenture
Trustee with an Issuer Order from time to time as to the amount to be
transferred.

     At any time in order to meet expenses that have been incorporated in an
amended budget, the Issuer may requisition from the Indenture Trustee the amount
that it is anticipated will be required to pay the Program Expenses not in
excess of the amount budgeted with respect to the Notes for the period to the
next deposit into the Operating Fund. The requisition, in the form of an Issuer
Order, shall include a statement that the amount requisitioned, when combined
with the amount requisitioned previously in the Fiscal Year, does not exceed the
amount currently budgeted for that year as Program Expenses or as may be further
limited by a Supplemental Indenture.

     Upon the receipt of such requisition, the Indenture Trustee shall withdraw
the amount requisitioned from the Revenue Fund, and if necessary, from the
Acquisition Fund (or so much thereof as is then on deposit in such Funds) and
transfer the same into the Operating Fund; provided, however, if (a) the Parity
Percentage and Senior Parity Percentage, calculated as of the month in which
such Program Expense are to be paid, is not at least equal to 98% and 103%,
respectively, or (b) the interest rate on any Series of Notes has been set at
the Net Loan Rate (as defined in the Supplemental Indenture authorizing the
issuance of such Notes) during the previous 12 months, amounts otherwise payable
to the Administrator or the Servicer for each of their services as Administrator
or Servicer (not including amounts payable to the Administrator or Servicer in
respect of fees payable by the Administrator or Servicer to third parties) shall
not be deposited into the Operating Fund. The Issuer may request that the
Indenture Trustee pay the requisitioned amount in installments as specified by
the Issuer. In the event there is not sufficient money on hand in the Revenue
Fund and the Acquisition Fund to transfer the full amount requisitioned, the
Indenture Trustee shall notify the Issuer and the Issuer shall then determine
the amount to be transferred.


                                       29

<PAGE>

     Section 4.08 Transfers to Co-Owner Trustee. Transfers from the Revenue Fund
to the Co-Owner Trustee may be made in accordance with Section 4.03(b)(ix)
hereof; provided, however, that no transfer of assets to the Co-Owner Trustee
shall be made if there is not on deposit in the Reserve Fund an amount equal to
at least the Reserve Fund Requirement; and further provided, that no transfer
shall be made to the Co-Owner Trustee unless immediately after taking into
account any such transfer, the Parity Percentage is at least equal to the
Required Parity Percentage and the Senior Parity Percentage is at least equal to
the Required Senior Parity Percentage.

     The amounts so transferred to the Co-Owner Trustee shall be distributed as
provided in the Trust Agreement.

     Section 4.09 Capitalized Interest Fund. The Indenture Trustee shall deposit
to the Capitalized Interest Fund or transfer to an Eligible Deposit Account at
the Issuer's depository bank if not the Indenture Trustee, the amount, if any,
specified in each Supplemental Indenture. On each Payment Date, to the extent
there are insufficient moneys in the Interest Fund to make the transfers
required by Sections 4.03(b)(i) and (iii) hereof, to the extent of moneys in the
Capitalized Interest Fund the amount of such deficiency shall be paid from the
Capitalized Interest Fund before any amounts are transferred from the Reserve
Fund pursuant to Section 4.06(a) hereof. Amounts remaining in the Capitalized
Interest Fund on April 4, 2004 will be transferred to the Revenue Fund and,
subject to the Rating Agency Condition, may be transferred on an earlier date.

     Section 4.10 Investment of Funds Held by Indenture Trustee. The Indenture
Trustee shall invest money held for the credit of any Fund or Account or
Subaccount held by the Indenture Trustee hereunder as directed in writing by an
Authorized Officer of the Issuer, to the fullest extent practicable and
reasonable, in Eligible Investments that shall mature or be redeemed prior to
the respective dates when the money held for the credit of such Fund or Account
will be required for the purposes intended. In the absence of any such direction
and to the extent practicable, the Indenture Trustee shall invest amounts held
hereunder in those Eligible Investments described in clause (a) of the
definition of the Eligible Investments. The Indenture Trustee and the Issuer
hereby agree that unless an Event of Default shall have occurred hereunder, the
Issuer acting by and through an Authorized Officer shall be entitled to, and
shall, provide written direction or oral direction confirmed in writing to the
Indenture Trustee with respect to any discretionary acts required or permitted
of the Indenture Trustee under any Eligible Investments and the Indenture
Trustee shall not take such discretionary acts without such written direction.

     The Eligible Investments purchased shall be held by the Indenture Trustee
and shall be deemed at all times to be part of such Fund or Account or
Subaccounts or combination thereof, and the Indenture Trustee shall inform the
Issuer of the details of all such investments. Upon direction in writing from an
Authorized Officer of the Issuer, the Indenture Trustee shall use its best
efforts to sell at the best price obtainable, or present for redemption, any
Eligible Investments purchased by it as an investment whenever it shall be
necessary to provide money to meet any payment from the applicable Fund. The
Indenture Trustee shall advise the Issuer in writing, on or before the fifteenth
day of each calendar month (or such later date as reasonably consented to by the
Issuer), of all investments held for the credit of each Fund in its custody


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<PAGE>

under the provisions of this Indenture as of the end of the preceding month and
the value thereof, and shall list any investments that were sold or liquidated
for less than their Value at the time thereof.

     Money in any Fund constituting a part of the Trust Estate may be pooled for
the purpose of making investments and may be used to pay accrued interest on
Eligible Investments purchased. The Indenture Trustee and its affiliates may act
as principal or agent in the acquisition or disposition of any Eligible
Investments.

     Notwithstanding the foregoing, the Indenture Trustee shall not be
responsible or liable for any losses on investments made by it hereunder or for
keeping all Funds held by it fully invested at all times, its only
responsibility being to comply with the investment instructions of the Issuer or
its designee in a non-negligent manner. The Indenture Trustee shall have no
liability in respect of losses incurred as a result of liquidation of any
Eligible Investment prior to its stated maturity or failure to provide timely
written directions.

     The Issuer acknowledges that to the extent the regulations of the
Comptroller of the Currency or other applicable regulatory agency grant the
Issuer the right to receive brokerage confirmations of security transactions,
the Issuer waives receipt of such confirmations.

     Section 4.11 Indenture Trustee's Control over the Trust Accounts. The
Indenture Trustee, on behalf of the Noteholders and any Counterparties, shall
possess all right, title and interest in all funds on deposit from time to time
in the Trust Accounts and in all proceeds thereof (including all income thereon)
and all such funds, investments, proceeds and income shall be part of the Trust
Estate. The Trust Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders and any Counterparties. If,
at any time, any of the Trust Accounts ceases to be an Eligible Deposit Account,
the Indenture Trustee agrees, by its acceptance hereto, that it shall within ten
(10) Business Days (or such longer period, not to exceed thirty (30) calendar
days, as to which each Rating Agency may consent) establish a new Trust Account
as an Eligible Deposit Account and shall transfer any cash and/or any
investments to such new Trust Account. In connection with the foregoing, the
Issuer agrees that, in the event that any of the Trust Accounts are not accounts
with the Indenture Trustee, the Issuer shall notify the Indenture Trustee and
any Counterparties in writing promptly upon any of such Trust Accounts ceasing
to be an Eligible Deposit Account.

     With respect to the Trust Account Property, the Indenture Trustee agrees,
by its acceptance hereof, that:

                  (a) any Trust Account Property that is held in deposit
accounts shall be held solely in Eligible Deposit Accounts and each such
Eligible Deposit Account shall be subject to the exclusive custody and control
of the Indenture Trustee, and the Indenture Trustee shall have sole signature
authority with respect thereto;

                  (b) any Trust Account Property that constitutes Physical
Property shall be Delivered to the Indenture Trustee in accordance with
paragraph (a) of the definition of "Delivery;" any Trust Account Property that
is a book-entry security held through the Federal Reserve System pursuant to
Federal book-entry regulations shall be Delivered in accordance


                                       31

<PAGE>

with paragraph (b) of the definition of "Delivery"; and any Trust Account
Property that is an "uncertificated security" under Article VIII of the UCC and
that is not governed by clause (3) above shall be Delivered to the Indenture
Trustee in accordance with paragraph (c) of the definition of "Delivery."

     Section 4.12 Release; Sale of Financed Student Loans. The Indenture Trustee
shall, upon Issuer Order and subject to the provisions of this Indenture and the
Rating Agency Condition, take all actions reasonably necessary to effect the
release of any Financed Student Loans from the lien of this Indenture; provided,
however, if all Notes Outstanding bear interest at an Auction Note Interest Rate
(as defined in the Supplemental Indenture(s) authorizing the issuance of such
Notes) and the release of Financed Student Loans will not cause the Parity
Percentage or the Senior Parity Percentage to fall below the Required Parity
Percentage or the Required Senior Parity Percentage, respectively, then Financed
Student Loans in an aggregate cumulative principal amount not exceeding 5% of
the original principal amount of each Series of Notes may be released from the
lien of this Indenture while such Series of Notes is Outstanding without
satisfying the Rating Agency Condition.

     Section 4.13 Purchase of Notes. Pursuant to this Indenture, any amounts
held under this Indenture that are available to redeem Notes may instead be used
to purchase Notes outstanding under this Indenture at the same times and subject
to the same conditions (except as to price) as apply to the redemption of Notes.

                                    Article V

                              Defaults and Remedies

     Section 5.01 Events of Default Defined. For the purpose of this Indenture,
the following events are hereby defined as, and are declared to be, "Events of
Default":

     (a)    default in the due and punctual payment of the principal of or
interest on any of the Senior Notes when due or failure to make any payment due
under any other Senior Obligations hereunder when due;

     (b)    if no Senior Obligations are Outstanding hereunder, default in the
due and punctual payment of the principal of or interest on any of the
Subordinate Notes or failure to make any payment due under any other Subordinate
Obligation when due;

     (c)    default in the performance or observance of any other of the
covenants, agreements, or conditions on the part of the Issuer to be kept,
observed, and performed contained in this Indenture or in the Notes, and
continuation of such default for a period of 90 days after written notice
thereof by the Indenture Trustee to the Issuer; and

     (d)    the occurrence of an Event of Bankruptcy with respect to the Issuer.

     Failure to pay interest carryover amounts or interest on interest carryover
amounts shall not constitute an Event of Default.


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<PAGE>

     Any notice herein provided to be given to the Issuer with respect to any
default shall be deemed sufficiently given if sent by registered mail with
postage prepaid to the Person to be notified, addressed to such Person at the
post office address as shown in Section 8.01 hereof or such other address as may
hereafter be given as the principal office of the Issuer in writing to the
Indenture Trustee by an Authorized Officer of the Issuer. The Indenture Trustee
shall give such notice if requested to do so in writing by the Noteholders of at
least a majority of the principal amount of the Highest Priority Obligations at
the time Outstanding ("Noteholder Approval").

     Section 5.02 Remedy on Default; Possession of Trust Estate. Subject to
Section 5.09 hereof, upon the happening and continuance of any Event of Default,
the Indenture Trustee personally or by its attorneys or agents may enter into
and upon and take possession of such portion of the Trust Estate as shall be in
the custody of others, and all property comprising the Trust Estate, and each
and every part thereof, and exclude the Issuer and its agents, servants, and
employees wholly therefrom, and have, hold, use, operate, manage, and control
the same and each and every part thereof, and in the name of the Issuer or
otherwise, as they shall deem best, conduct the business thereof and exercise
the privileges pertaining thereto and all the rights and powers of the Issuer
and use all of the then existing Trust Estate for that purpose, and collect and
receive all charges, income and Revenue of the same and of every part thereof,
and after deducting therefrom all expenses incurred hereunder and all other
proper outlays herein authorized, and all payments that may be made as just and
reasonable compensation for its own services, and for the services of its
attorneys, agents, and assistants (and any other amounts due and owing including
amounts due and owing to the Owner Trustee and Co-Owner Trustee), the Indenture
Trustee shall apply the rest of the money received by the Indenture Trustee as
follows:

     (a)    if the principal of none of the Obligations shall have become due,
first, to the payment of the interest in default on the Senior Notes and to the
payment of all Issuer Derivative Payments secured on a parity with the Senior
Notes then due, in order of the maturity of the installments thereof, with
interest on the overdue installments thereof at the same rates, respectively, as
were borne by the Senior Notes on which such interest shall be in default and
any such Issuer Derivative Payments as provided in the ISDA Master Agreement
then due, such payments to be made ratably to the parties entitled thereto
without discrimination or preference, second, to the payment of the interest in
default on the Subordinate Notes and to the payment of all Issuer Derivative
Payments secured on a parity with the Subordinate Notes then due, in order of
the maturity of the installments of such interest and any such Issuer Derivative
Payments, with interest on the overdue installments thereof at the same rates,
respectively, as were borne by the Subordinate Notes on which such interest
shall be in default and any such Issuer Derivative Payments then due, such
payments to be made ratably to the parties entitled thereto without
discrimination or preference, and third, to the payment of the interest in
default on any other borrowings of the Issuer, if any, secured hereby and to the
payment of all Issuer Derivative Payments secured on a parity with such
borrowings, if any, then due, in order of the maturity of the installments of
such interest and any such Issuer Derivative Payments, with interest on the
overdue installments thereof at the same rates, respectively, as were borne by
such borrowings on which such interest shall be in default and any such Issuer
Derivative Payments then due, such payments to be made ratably to the parties
entitled thereto without discrimination or preference, except as may be provided
in a Supplemental Indenture; and


                                       33

<PAGE>

     (b)    if the principal of any of the Obligations shall have become due by
declaration of acceleration or otherwise, first to the payment of the interest
in default on the Senior Notes and all Issuer Derivative Payments secured on a
parity with the Senior Notes then due, in the order of the maturity of the
installments thereof, with interest on overdue installments thereof at the same
rates, respectively, as were borne by the Senior Notes on which such interest
shall be in default and such Issuer Derivative Payments as provided in the ISDA
Master Agreement then due, as the case may be, second, to the payment of the
principal of all Senior Notes then due and any amount owed to a Counterparty
secured on a parity with Senior Obligations under the ISDA Master Agreement,
such payments to be made ratably to the parties entitled thereto without
discrimination or preference, third, to the payment of the interest in default
on the Subordinate Notes and all Issuer Derivative Payments secured on a parity
with the Subordinate Notes then due, in the order of the maturity of the
installments thereof with interest on overdue installments thereof at the same
rates, respectively, as were borne by the Subordinate Notes on which such
interest shall be in default and such Issuer Derivative Payments as provided in
the ISDA Master Agreement then due, as the case may be, fourth, to the payment
of the principal of all Subordinate Notes then due and any amount owed to a
Counterparty secured on a parity with Subordinate Obligations under the ISDA
Master Agreement, such payments to be made ratably to the parties entitled
thereto without discrimination or preference, fifth, to the payment of the
interest in default on all other borrowings of the Issuer, if any, secured
hereby and all Issuer Derivative Payments secured on a parity with such
borrowings then due, in the order of the maturity of the installments thereof at
the same rates, respectively, as were borne by such borrowings on which such
interest shall be in default and such Issuer Derivative Payments as provided in
the ISDA Master Agreement then due, as the case may be, and sixth, to the
payment of the principal of all other borrowings of the Issuer, if any, secured
hereby then due and any amount owed to a Counterparty secured on a parity with
such borrowings under the ISDA Master Agreement, such payments to be made
ratably to the parties entitled thereto without discrimination or preference,
except as may be provided in a Supplemental Indenture.

     Section 5.03 Remedies on Default; Advice of Counsel. Upon the happening of
any Event of Default, the Indenture Trustee may proceed to protect and enforce
the rights of the Indenture Trustee and the Noteholders in such manner as
counsel for the Indenture Trustee may advise, whether for the specific
performance of any covenant, condition, agreement or undertaking herein
contained, or in aid of the execution of any power herein granted, or for the
enforcement of such other appropriate legal or equitable remedies as, in the
opinion of such counsel, may be more effectual to protect and enforce the rights
aforesaid.

     Section 5.04 Remedies on Default; Sale of Trust Estate. Upon the happening
of any Event of Default and if the principal of all of the Outstanding
Obligations shall have been declared due and payable, then and in every such
case, and irrespective of whether other remedies authorized shall have been
pursued in whole or in part, the Indenture Trustee may sell, with or without
entry, to the highest bidder the Trust Estate, and all right, title, interest,
claim and demand thereto and the right of redemption thereof, at any such place
or places, and at such time or times and upon such notice and terms as may be
required by law. Upon such sale the Indenture Trustee may make and deliver to
the purchaser or purchasers a good and sufficient assignment or conveyance for
the same, which sale shall be a perpetual bar both at law and in equity against
the Issuer and all Persons claiming such properties. No purchaser at any sale
shall be bound to see to the application of the purchase money or to inquire as
to the authorization,


                                       34

<PAGE>

necessity, expediency or regularity of any such sale. The Indenture Trustee is
hereby irrevocably appointed the true and lawful attorney-in-fact of the Issuer,
in its name and stead, to make and execute all bills of sale, instruments of
assignment and transfer and such other documents of transfer as may be necessary
or advisable in connection with a sale of all or part of the Trust Estate, but
the Issuer, if so requested by the Indenture Trustee, shall ratify and confirm
any sale or sales by executing and delivering to the Indenture Trustee or to
such purchaser or purchasers all such instruments as may be necessary, or in the
judgment of the Indenture Trustee, proper for the purpose that may be designated
in such request. In addition, the Indenture Trustee may proceed to protect and
enforce the rights of the Indenture Trustee and the holders of the Obligations
in such manner as counsel for the Indenture Trustee may advise, whether for the
specific performance of any covenant, condition, agreement or undertaking herein
contained, or in aid of the execution of any power herein granted, or for the
enforcement of such other appropriate legal or equitable remedies as may in the
opinion of such counsel, be more effectual to protect and enforce the rights
aforesaid. The Indenture Trustee shall take any such action or actions if
requested to do so in writing by the Noteholders of at least a majority of the
principal amount of the Highest Priority Obligations at the time Outstanding.

     Section 5.05 Appointment of Receiver. In case an Event of Default occurs,
and if all of the Outstanding Obligations shall have been declared due and
payable and in case any judicial proceedings are commenced to enforce any right
of the Indenture Trustee or of the Noteholders under this Indenture or
otherwise, then as a matter of right, the Indenture Trustee shall be entitled to
the appointment of a receiver of the Trust Estate and of the earnings, income or
Revenue, rents, issues and profits thereof with such powers as the court making
such appointments may confer.

     Section 5.06 Restoration of Position. In case the Indenture Trustee shall
have proceeded to enforce any rights under this Indenture by sale or otherwise,
and such proceedings shall have been discontinued, or shall have been determined
adversely to the Indenture Trustee, then and in every such case to the extent
not inconsistent with such adverse decree, the Issuer, the Indenture Trustee and
the Noteholders shall be restored to their former respective positions and the
rights hereunder in respect to the Trust Estate, and all rights, remedies, and
powers of the Indenture Trustee and of the Noteholders shall continue as though
no such proceeding had been taken.

     Section 5.07 Purchase of Properties by Indenture Trustee or Noteholders. In
case of any such sale of the Trust Estate, any Noteholder or Noteholders or
committee of Noteholders or the Indenture Trustee, may bid for and purchase such
property and upon compliance with the terms of sale may hold, retain possession,
and dispose of such property as the absolute right of the purchaser or
purchasers without further accountability and shall be entitled, for the purpose
of making any settlement or payment for the property purchased, to use and apply
any Obligations hereby secured and any interest thereon due and unpaid, by
presenting such Obligations in order that there may be credited thereon the sum
apportionable and applicable thereto out of the net proceeds of such sale, and
thereupon such purchaser or purchasers shall be credited on account of such
purchase price payable to him or them with the sum apportionable and applicable
out of such net proceeds to the payment of or as a credit on the Obligations so
presented.


                                       35

<PAGE>

     Section 5.08 Application of Sale Proceeds. The proceeds of any sale of the
Trust Estate, together with any funds at the time held by the Indenture Trustee
and not otherwise appropriated, shall be applied by the Indenture Trustee as set
forth in Section 5.02 hereof, and then to the Issuer or whomsoever shall be
lawfully entitled thereto.

     Section 5.09 Accelerated Maturity. If an Event of Default shall have
occurred and be continuing, the Indenture Trustee may declare, or upon the
written direction by the Noteholders of at least 66% of the principal amount of
the Highest Priority Obligations then Outstanding, shall declare, the principal
of all Obligations then Outstanding, and the interest thereon, if not previously
due, immediately due and payable, anything in the Obligations or this Indenture
to the contrary notwithstanding; provided, however, that for a declaration of
acceleration upon a default pursuant to Section 5.01(c) hereof shall require the
consent of a majority of the Noteholders of the principal amount of the Highest
Priority Obligations then Outstanding.

     Section 5.10 Remedies Not Exclusive. The remedies herein conferred upon or
reserved to the Indenture Trustee or the holders of Obligations are not intended
to be exclusive of any other remedy, but each remedy herein provided shall be
cumulative and shall be in addition to every other remedy given hereunder or now
or hereafter existing, and every power and remedy hereby given to the Indenture
Trustee or to the holders of Obligations, or given by any Supplemental
Indenture, may be exercised from time to time as often as may be deemed
expedient. No delay or omission of the Indenture Trustee or of any holder of
Obligations to exercise any power or right arising from any default hereunder
shall impair any such right or power or shall be construed to be a waiver of any
such default or to be acquiescence therein.

     Section 5.11 Direction of Indenture Trustee. Upon the happening of any
Event of Default, the Noteholders of at least a majority of the principal amount
of the Highest Priority Obligations then Outstanding, shall have the right by an
instrument or instruments in writing delivered to the Indenture Trustee to
direct and control the Indenture Trustee as to the method of taking any and all
proceedings for any sale of any or all of the Trust Estate, or for the
appointment of a receiver, if permitted by law, and may at any time cause any
proceedings authorized by the terms hereof to be so taken or to be discontinued
or delayed; provided, however, that such Noteholders shall not be entitled to
cause the Indenture Trustee to take any proceedings that in the Indenture
Trustee's opinion would be unjustly prejudicial to non-assenting holders of
Obligations, but the Indenture Trustee shall be entitled to assume that the
action requested by the Noteholders of at least a majority of the principal
amount of the Highest Priority Obligations then Outstanding will not be
prejudicial to any non-assenting Noteholders unless the Noteholders of at least
a majority of the principal amount of Obligations of the non-assenting
Noteholders, in writing, show the Indenture Trustee how they will be prejudiced.
Anything in this Indenture to the contrary notwithstanding, the Noteholders of
at least a majority of the principal amount of the Highest Priority Obligations
then Outstanding together with the Noteholders of at least a majority of the
principal amount of all other Obligations then Outstanding shall have the right,
at any time, by an instrument or instruments in writing executed and delivered
to the Indenture Trustee, to direct the method and place of conducting all
proceedings to be taken in connection with the enforcement of the terms and
conditions of this Indenture, or for the appointment of a receiver or any other
proceedings hereunder, provided that such direction shall not be otherwise than
in accordance with the provisions of law and of this


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<PAGE>

Indenture. The provisions of this Section 5.11 shall be expressly subject to the
provisions of Sections 6.01(c) and 6.05 hereof.

     Section 5.12 Right to Enforce in Indenture Trustee. No Noteholder of any
Obligation shall have any right as such Noteholder to institute any suit,
action, or proceedings for the enforcement of the provisions of this Indenture
or for the execution of any trust hereunder or for the appointment of a receiver
or for any other remedy hereunder, all rights of action hereunder being vested
exclusively in the Indenture Trustee, unless and until the Indenture Trustee
fails to institute an action or suit after (i) the Noteholders of at least 25%
of the Notes shall have previously given to the Indenture Trustee written notice
of a default hereunder, and of the continuance thereof, (ii) the Noteholders of
at least 25% of the Notes shall have made written request upon the Indenture
Trustee and the Indenture Trustee shall have been afforded reasonable
opportunity to institute such action, suit or proceeding in its own name, and
(iii) the Indenture Trustee shall have been offered indemnity and security
satisfactory to it against the costs, expenses, and liabilities to be incurred
therein or thereby, which offer of indemnity shall be an express condition
precedent hereunder to any obligation of the Indenture Trustee to take any such
action hereunder, and the Indenture Trustee for 30 days after receipt of such
notification, request, and offer of indemnity, shall have failed to institute
any such action, suit or proceeding. It is understood and intended that no one
or more holders of the Obligations shall have the right in any manner whatever
by his or their action to affect, disturb, or prejudice the lien of this
Indenture or to enforce any right hereunder except in the manner herein provided
and for the equal benefit of the Noteholders of not less than a majority of the
principal amount of the Obligations then Outstanding.

     The Indenture Trustee and the Noteholders covenant that they will not at
any time institute against the Trust any bankruptcy, reorganization or other
proceeding under any federal or state bankruptcy or similar law.

     Section 5.13 Physical Possession of Obligations Not Required. In any suit
or action by the Indenture Trustee arising under this Indenture or on all or any
of the Obligations issued hereunder, or under any Supplemental Indenture, the
Indenture Trustee shall not be required to produce such Obligations, but shall
be entitled in all things to maintain such suit or action without their
production.

     Section 5.14 Waivers of Events of Default. The Indenture Trustee may in its
discretion waive any Event of Default hereunder and its consequences and rescind
any declaration of acceleration of Obligations, and shall do so upon the written
request of the Noteholders of at least a majority of the principal amount of the
Highest Priority Obligations then Outstanding; provided, however, that there
shall not be waived (a) any Event of Default in the payment of the principal of
or premium on any Outstanding Obligations at the date of maturity or redemption
thereof, or any default in the payment when due of the interest on any such
Obligations, unless prior to such waiver or rescission, all arrears of interest
or all arrears of payments of principal and premium, if any, and all expenses of
the Indenture Trustee, in connection with such default shall have been paid or
provided for or (b) any default in the payment of amounts set forth in Section
6.05 hereof. In case of any such waiver or rescission, or in case any
proceedings taken by the Indenture Trustee on account of any such default shall
have been discontinued or abandoned or determined adversely to the Indenture
Trustee, then and in


                                       37

<PAGE>

every such case the Issuer, the Indenture Trustee and the holders of Obligations
shall be restored to their former positions and rights hereunder respectively,
but no such waiver or rescission shall extend to or affect any subsequent or
other default, or impair any rights or remedies consequent thereon.

                                   Article VI

                              The Indenture Trustee

     Section 6.01 Acceptance of Trust. The Indenture Trustee hereby accepts the
trusts imposed upon it by this Indenture, and agrees to perform said trusts, but
only upon and subject to the following terms and conditions:

     (a)    Except during the continuance of an Event of Default,

     (i)    the Indenture Trustee undertakes to perform such duties and only
   such duties as are specifically set forth in this Indenture, and no implied
   covenants or obligations shall be read into this Indenture against the
   Indenture Trustee; and

     (ii)   in the absence of bad faith on its part, the Indenture Trustee may
   conclusively rely, as to the truth of the statements and the correctness of
   the opinions expressed therein, upon certificates or opinions furnished to
   the Indenture Trustee and conforming to the requirements of this Indenture;
   but in the case of any such certificates or opinions that by any provisions
   hereof are specifically required to be furnished to the Indenture Trustee,
   the Indenture Trustee shall be under a duty to examine the same to determine
   whether or not they conform as to form with the requirements of this
   Indenture and whether or not they contain the statements required under this
   Indenture.

     (b)    In case an Event of Default has occurred and is continuing, the
Indenture Trustee, in exercising the rights and powers vested in it by this
Indenture, shall use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.

     (c)    Before taking any action hereunder requested by Noteholders, the
Indenture Trustee may require that it be furnished an indemnity bond or other
indemnity and security satisfactory to it by the Noteholders for the
reimbursement of all expenses it may incur and to protect it against liability
arising from any action taken by the Indenture Trustee (excluding, however, any
action taken by the Indenture Trustee acting as Servicer pursuant to Section
6.15 hereof).

     Section 6.02 Recitals of Others. The recitals, statements, and
representations set forth herein and in the Notes shall be taken as the
statements of the Issuer, and the Indenture Trustee assumes no responsibility
for the correctness of the same. The Indenture Trustee makes no representations
as to the title of the Issuer in the Trust Estate or as to the security afforded
thereby and hereby, or as to the validity or sufficiency of this Indenture or of
the Notes issued hereunder, and the Indenture Trustee shall incur no
responsibility in respect of such matters.


                                       38

<PAGE>

     Section 6.03 As to Filing of Indenture. The Indenture Trustee shall be
under no duty (a) to file or record, or cause to be filed or recorded, this
Indenture or any Supplemental Indenture, (b) or to procure any further order or
additional instruments of further assurance, (c) to see to the delivery to it of
any personal property intended to be mortgaged or pledged hereunder or
thereunder, (d) or to do any act that may be suitable to be done for the better
maintenance of the lien or security hereof (other than the filing of any
continuation statements (but not initial financing statements) ), or (e) for
giving notice of the existence of such lien, or for extending or supplementing
the same or to see that any rights to Revenue and Funds intended now or
hereafter to be transferred in trust hereunder are subject to the lien hereof.
The Indenture Trustee shall not be liable for failure of the Issuer to pay any
tax or taxes in respect of such property, or any part thereof, or the income
therefrom or otherwise, nor shall the Indenture Trustee be under any duty in
respect of any tax that may be assessed against it or the Noteholders in respect
of such property or pledged Revenue and Funds.

     Section 6.04 Indenture Trustee May Act Through Agents. The Indenture
Trustee may execute any of the trusts or powers hereof and perform any duty
hereunder, either itself or by or through its attorneys, agents, or employees,
and it shall not be answerable or accountable for any default, neglect, or
misconduct of any such attorneys, agents, or employees, if reasonable care has
been exercised in the appointment, supervision, and monitoring of the work
performed. All reasonable costs incurred by the Indenture Trustee and all
reasonable compensation to all such persons as may reasonably be employed in
connection with the trusts hereof shall be paid by the Issuer.

     Section 6.05 Indemnification of Indenture Trustee. Other than with respect
to its duties to make payment on the Obligations when due, and its duty to
pursue the remedy of acceleration as provided in Section 5.02 hereof, for each
of which no additional security or indemnity may be required, the Indenture
Trustee shall be under no obligation or duty to perform any act at the request
of Noteholders or to institute or defend any suit in respect thereof unless
properly indemnified and provided with security to its satisfaction as provided
in Section 6.01(c) hereof. The Indenture Trustee shall not be required to take
notice, or be deemed to have knowledge, of any default or Event of Default of
the Issuer hereunder and may conclusively assume that there has been no such
default or Event of Default (other than an Event of Default described in
Sections 5.01(a) or (b) hereof) unless and until a Responsible Officer shall
have been specifically notified in writing at the address in Section 8.01 hereof
of such default or Event of Default by (a) the Noteholders of the required
percentages in principal amount of the Obligations then Outstanding hereinabove
specified or (b) an Authorized Officer of the Issuer. However, the Indenture
Trustee may begin suit, or appear in and defend suit, execute any of the trusts
hereby created, enforce any of its rights or powers hereunder, or do anything
else in its judgment proper to be done by it as Indenture Trustee, without
assurance of reimbursement or indemnity, and in such case the Indenture Trustee
shall be reimbursed or indemnified by the Noteholders requesting such action, if
any, or the Issuer in all other cases, for all fees, costs and expenses,
liabilities, outlays and counsel fees and other reasonable disbursements
properly incurred in connection therewith, unless such costs and expenses,
liabilities, outlays and attorneys' fees and other reasonable disbursements
properly incurred in connection therewith are adjudicated to have resulted from
the gross negligence or willful misconduct of the Indenture Trustee. In
furtherance and not in limitation of this Section 6.05, the Indenture Trustee
shall not be liable for, and shall be held harmless by the Issuer from,
following any orders, instructions or


                                       39

<PAGE>

other directions upon which the Indenture Trustee is authorized to rely pursuant
to this Indenture or any other agreement to which it is a party. If the Issuer
or the Noteholders, as appropriate, shall fail to make such reimbursement or
indemnification, the Indenture Trustee may reimburse itself from any money in
its possession under the provisions of this Indenture, subject only to the prior
lien of the Notes for the payment of the principal thereof, premium, if any, and
interest thereon from the Revenue Fund. None of the provisions contained in this
Indenture or any other agreement to which it is a party shall require the
Indenture Trustee to act or to expend or risk its own funds or otherwise incur
individual financial liability in the performance of any of its duties or in the
exercise of any of its rights or powers (excluding, however, any duties, rights
or powers of the Indenture Trustee acting as Servicer pursuant to Section 6.15
hereof) if the Noteholders shall not have offered security and indemnity
acceptable to it or if it shall have reasonable grounds for believing that
prompt repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.

     The Issuer shall indemnify the Indenture Trustee and its officers, agents,
directors and employees, against any and all loss, liability or expense
(including reasonable attorneys' fees and expenses) incurred by it in connection
with the administration of this trust and the performance of its duties
hereunder (excluding, however, any duties of the Indenture Trustee acting as
Servicer pursuant to Section 6.15 hereof) or under the Basic Documents including
the costs and expenses of defending itself against any claim or liability in
connection with the exercise or performance of any of its powers or duties
hereunder or under the Basic Documents. Without limiting the foregoing, the
Issuer agrees to indemnify and hold harmless the Indenture Trustee from and
against any liability (including for taxes, penalties or interest asserted by
any taxing jurisdiction) arising from any failure to withhold taxes from amounts
payable in respect of payments from the Revenue Fund. The Indenture Trustee
shall notify the Issuer promptly of any claim for which it may seek indemnity.
Failure by the Indenture Trustee to so notify the Issuer shall not relieve the
Issuer of its obligations hereunder, except to the extent of any loss, liability
or expense resulting from such failure. The Issuer need not reimburse any
expense or indemnity against any loss, liability or expense incurred by the
Indenture Trustee through the Indenture Trustee's own willful misconduct, gross
negligence or bad faith.

     Section 6.06 Indenture Trustee's Right to Reliance. The Indenture Trustee
shall fully be protected in acting upon any notice, resolution, request,
consent, order, certificate, report, appraisal, opinion, report or document of
the Issuer or the Servicer or other paper or document believed by it to be
genuine and to have been signed or presented by the proper party or parties. The
Indenture Trustee may consult with experts and with counsel (who may, but need
not, be counsel for the Issuer, the Indenture Trustee, or for a Noteholder), and
the opinion of such counsel shall be full and complete authorization and
protection in respect of any action taken or suffered, and in respect of any
determination made by it hereunder in good faith and in accordance with the
opinion of such counsel.

     Whenever in the administration hereof the Indenture Trustee shall
reasonably deem it desirable that a matter be proved or established prior to
taking, suffering, or omitting any action hereunder, the Indenture Trustee
(unless other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon a certificate signed by an Authorized Officer
of the Issuer or an authorized officer of the Servicer.


                                       40

<PAGE>

          The Indenture Trustee shall not be liable for any action taken,
suffered, or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it hereby; provided,
however, that the Indenture Trustee shall be liable for its gross negligence or
willful misconduct in taking such action.

          The Indenture Trustee is authorized, under this Indenture, subject to
Section 4.12 hereof, to sell, assign, transfer or convey Financed Student Loans
in accordance with an Issuer Order. If such Financed Student Loan was originated
under the Act, such Issuer Order shall certify that the Person to whom such
Financed Student Loan is sold, assigned, transferred, or conveyed is an Eligible
Lender unless not required by the Act. The Indenture Trustee is further
authorized to enter into agreements with other Persons, in its capacity as
Indenture Trustee, in order to carry out or implement the terms and provisions
of this Indenture.

          The duties and obligations of the Indenture Trustee shall be
determined solely by the express provisions of this Indenture, and the Indenture
Trustee shall take such action with respect to this Indenture as it shall be
directed hereunder, and the Indenture Trustee shall not be liable except for the
performance of such duties and obligations as are specifically set forth in this
Indenture and as specifically directed by the Issuer or the Servicer, and no
implied covenants or obligations shall be read into this Indenture against the
Indenture Trustee.

          The Indenture Trustee shall not be liable for any error of judgment
made in good faith by an officer or officers of the Indenture Trustee, unless it
shall be conclusively determined by a court of competent jurisdiction that the
Indenture Trustee was grossly negligent in ascertaining the pertinent facts.

          The Indenture Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents, attorneys, custodians or nominees appointed with due care, and shall not
be responsible for any willful misconduct or gross negligence on the part of any
agent, attorney, custodian or nominee so appointed.

          Section 6.07 Compensation of Indenture Trustee. Except as otherwise
expressly provided herein, all advances, counsel fees and other expenses
reasonably made or incurred by the Indenture Trustee in and about the execution
and administration of the trust hereby created and reasonable compensation to
the Indenture Trustee for its services in the premises shall be paid by the
Issuer. The compensation of the Indenture Trustee shall not be limited to or by
any provision of law in regard to the compensation of trustees of an express
trust. If not paid by the Issuer, the Indenture Trustee shall have a lien
against all money held pursuant to this Indenture, subject only to the prior
lien of the Obligations against the money and investments in the Revenue Fund
for the payment of the principal thereof, premium, if any, and interest thereon,
for such reasonable compensation, expenses, advances and counsel fees incurred
in and about the execution of the trusts hereby created and the exercise and
performance of the powers and duties of the Indenture Trustee hereunder and the
cost and expense incurred in defending against any liability in the premises of
any character whatsoever (unless such liability is adjudicated to have resulted
from the gross negligence or willful misconduct of the Indenture Trustee).

          Section 6.08 Indenture Trustee May Own Notes. The Indenture Trustee
hereunder, or any successor Indenture Trustee, in its individual or other
capacity, may become the owner or


                                       41

<PAGE>

pledgee of Notes and may otherwise deal with the Issuer, with the same rights it
would have if it were not the Indenture Trustee. The Indenture Trustee may act
as depository for, and permit any of its officers or directors to act as a
member of, or act in any other capacity in respect to, any committee formed to
protect the rights of the Noteholders or to effect or aid in any reorganization
growing out of the enforcement of the Notes or of this Indenture, whether or not
any such committee shall represent the Noteholders of more than 66% of the
principal amount of the Outstanding Obligations.

          Section 6.09 Resignation of Indenture Trustee. The Indenture Trustee
and any successor to the Indenture Trustee may resign and be discharged from the
trust created by this Indenture by giving to the Issuer notice in writing, which
notice shall specify the date on which such resignation is to take effect;
provided, however, that such resignation shall only take effect on the day
specified in such notice if a successor Indenture Trustee shall have been
appointed pursuant to Section 6.11 hereof (and is qualified to be the Indenture
Trustee under the requirements of Section 6.11 hereof). If no successor
Indenture Trustee has been appointed by the date specified or within a period of
90 days from the receipt of the notice by the Issuer, whichever period is the
longer, the Indenture Trustee may (a) appoint a temporary successor Indenture
Trustee having the qualifications provided in Section 6.11 hereof or (b) request
a court of competent jurisdiction to (i) require the Issuer to appoint a
successor, as provided in Section 6.11 hereof, within 3 days of the receipt of
citation or notice by the court, or (ii) appoint an Indenture Trustee having the
qualifications provided in Section 6.11 hereof. In no event may the resignation
of the Indenture Trustee be effective until a qualified successor Indenture
Trustee shall have been selected and appointed. In the event a temporary
successor Indenture Trustee is appointed pursuant to (a) above, the Issuer may
remove such temporary successor Indenture Trustee and appoint a successor
thereto pursuant to Section 6.11 hereof.

          Section 6.10 Removal of Indenture Trustee. The Indenture Trustee or
any successor Indenture Trustee may be removed (a) at any time by the
Noteholders of a majority of the principal amount of the Highest Priority
Obligations then Outstanding, (b) by the Issuer for cause or upon the sale or
other disposition of the Indenture Trustee or its corporate trust functions or
(c) by the Issuer without cause so long as no Event of Default as described in
Sections 5.01(a), (b) or (c) exists or has existed within the last 30 days, upon
payment to the Indenture Trustee so removed of all money then due to it
hereunder and appointment of a successor thereto by the Issuer and acceptance
thereof by said successor. One copy of any such order of removal shall be filed
with the Issuer and the other with the Indenture Trustee so removed.

          In the event an Indenture Trustee (or successor Indenture Trustee) is
removed by any Person or for any reason permitted hereunder, such removal shall
not become effective until (a) in the case of removal by the Noteholders, such
Noteholders by instrument or concurrent instruments in writing (signed and
acknowledged by such Noteholders or their attorneys-in-fact) filed with the
Indenture Trustee removed have appointed a successor Indenture Trustee or
otherwise the Issuer shall have appointed a successor, and (b) the successor
Indenture Trustee has accepted appointment as such.

          Section 6.11 Successor Indenture Trustee. In case at any time the
Indenture Trustee or any successor Indenture Trustee shall resign, be dissolved,
or otherwise shall be


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<PAGE>

disqualified to act or be incapable of acting, or in case control of the
Indenture Trustee or of any successor Indenture Trustee or of its officers shall
be taken over by any public officer or officers, a successor Indenture Trustee
may be appointed by the Issuer. In the case of any such appointment by the
Issuer of a successor Indenture Trustee, the Issuer shall forthwith cause notice
thereof to be mailed to the Noteholders at the address of each Noteholder
appearing on the note registration books maintained by the Indenture Trustee.
Every successor Indenture Trustee appointed by the Noteholders, by a court of
competent jurisdiction, or by the Issuer shall be a bank or trust company in
good standing, organized and doing business under the laws of the United States
or of a state therein, that has a reported capital and surplus of not less than
$50,000,000, be authorized under the law to exercise corporate trust powers, be
subject to supervision or examination by a federal or state authority, and be an
Eligible Lender so long as such designation is necessary to maintain guarantees
and federal benefits under the Act with respect to Financed Student Loans that
were originated under the Act.

          Section 6.12 Manner of Vesting Title in Indenture Trustee. Any
successor Indenture Trustee appointed hereunder shall execute, acknowledge, and
deliver to its predecessor Indenture Trustee, and also to the Issuer, an
instrument accepting such appointment hereunder, and thereupon such successor
Indenture Trustee, without any further act, deed, or conveyance shall become
fully vested with all the estate, properties, rights, powers, trusts, duties,
and obligations of its predecessors in trust hereunder (except that the
predecessor Indenture Trustee shall continue to have the benefits to
indemnification hereunder together with the successor Indenture Trustee), with
like effect as if originally named as Indenture Trustee herein; but the
Indenture Trustee ceasing to act shall nevertheless, on the written request of
an Authorized Officer of the Issuer, or an authorized officer of the successor
Indenture Trustee, execute, acknowledge, and deliver such instruments of
conveyance and further assurance and do such other things as may reasonably be
required for more fully and certainly vesting and confirming in such successor
Indenture Trustee all the right, title, and interest of the Indenture Trustee
that it succeeds, in and to pledged Revenue and Funds and such rights, powers,
trusts, duties, and obligations, and the Indenture Trustee ceasing to act also
shall, upon like request, pay over, assign, and deliver to the successor
Indenture Trustee any money or other property or rights subject to the lien of
this Indenture, including any pledged securities that may then be in its
possession. Should any deed or instrument in writing from the Issuer be required
by the successor Indenture Trustee for more fully and certainly vesting in and
confirming to such new Indenture Trustee such estate, properties, rights,
powers, and duties, any and all such deeds and instruments in writing shall on
request be executed, acknowledged and delivered by the Issuer.

          In case any of the Notes to be issued hereunder shall have been
authenticated but not delivered, any successor Indenture Trustee may adopt the
certificate of authentication of the Indenture Trustee or of any successor to
the Indenture Trustee; and in case any of the Notes shall not have been
authenticated, any successor to the Indenture Trustee may authenticate such
Notes in its own name; and in all such cases such certificate shall have the
full force that it has anywhere in the Notes or in this Indenture.

          Section 6.13 Additional Covenants by the Indenture Trustee to Conform
to the Act. The Indenture Trustee covenants that it will at all times be an
Eligible Lender under the Act so long as such designation is necessary, as
determined by the Issuer, to maintain the guarantees and federal benefits under
the Act with respect to Financed Student Loans that were originated


                                       43

<PAGE>

under the Act, that it will acquire Student Loans originated under the Act in
its capacity as an Eligible Lender, and that it will not dispose of or deliver
any Student Loans originated under the Act or any security interest in any such
Student Loans to any party who is not an Eligible Lender so long as the Act or
Regulations adopted thereunder require an Eligible Lender to be the owner or
holder of such Student Loans; provided, however, that nothing above shall
prevent the Indenture Trustee from delivering Student Loans originated under the
Act to the Servicer or the Guaranty Agency.

          Section 6.14 Limitation with Respect to Examination of Reports. Except
as provided in this Indenture, the Indenture Trustee shall be under no duty to
examine any report or statement or other document required or permitted to be
filed with it by the Issuer.

          Section 6.15 Servicing Agreement. The Indenture Trustee acknowledges
the receipt of a copy of the Servicing Agreement. The Indenture Trustee, by the
execution hereof, covenants, represents and agrees that upon any termination of
the Servicer pursuant to the Servicing Agreement, the Indenture Trustee shall,
pursuant to Section 11 of the Servicing Agreement, act as Servicer until a
successor servicer has been appointed as provided in that Section 11.

          Section 6.16 Additional Covenants of Indenture Trustee. The Indenture
Trustee, by the execution hereof, covenants, represents and agrees that:

          (a) it will not exercise any of the rights, duties, or privileges
under this Indenture in such manner as would cause the Student Loans held or
acquired under the terms hereof to be transferred, assigned, or pledged as
security to any person or entity other than as permitted by this Indenture; and

          (b) so long as any of the Financed Student Loans were originated under
the Act, it will comply with the Act and the Regulations and will, upon written
notice from an Authorized Officer of the Issuer, the Secretary, or the Guaranty
Agency, use its reasonable efforts to cause this Indenture to be amended (in
accordance with Section 7.01 hereof) if the Act or Regulations are hereafter
amended so as to be contrary to the terms of this Indenture.

          Section 6.17 Duty of Indenture Trustee with Respect to Rating
Agencies. It shall be the duty of the Indenture Trustee to notify each Rating
Agency then rating any of the Notes (but the Indenture Trustee shall incur no
liability for any failure to do so) of (a) any change, expiration, extension, or
renewal of this Indenture, (b) redemption or defeasance of any or all the Notes,
(c) any change in the Indenture Trustee or (d) any other information
specifically required to be reported to each Rating Agency under any
Supplemental Indenture; provided, however, the provisions of this Section 6.17
do not apply when such documents have been previously supplied to such Rating
Agency and the Indenture Trustee has received written evidence to such effect,
all as may be required by this Indenture. All notices required to be forwarded
to the Rating Agencies under this Section 6.17 shall be sent in writing at the
following addresses:

          Fitch Ratings
          One State Street Plaza
          32/nd/ Floor


                                       44

<PAGE>

          New York, New York 10004
          Attention: ABS Surveillance

          Moody's Investors Service, Inc.
          99 Church Street
          New York, New York 10007
          Attention: ABS Monitoring Unit

          The Indenture Trustee also acknowledges that each Rating Agency's
periodic review for maintenance of a Rating on any Series of the Notes may
involve discussions and/or meetings with representatives of the Indenture
Trustee at mutually agreeable times and places.

          Section 6.18 Merger of the Indenture Trustee. Any corporation into
which the Indenture Trustee may be merged or with which it may be consolidated,
or any corporation resulting from any merger or consolidation to which the
Indenture Trustee shall be a party, or any corporation succeeding to all or
substantially all of the corporate trust business of the Indenture Trustee,
shall be the successor of the Indenture Trustee hereunder, provided such
corporation shall be otherwise qualified and eligible under this Indenture,
without the execution or filing of any paper of any further act on the part of
any other parties hereto.

          Section 6.19 Receipt of Funds from Servicer. The Indenture Trustee
shall not be accountable or responsible in any manner whatsoever for any action
of the Issuer, the depository bank of any funds of the Issuer, or the Servicer
while the Servicer is acting as bailee or agent of the Indenture Trustee with
respect to the Student Loans except, to the extent provided in the Servicing
Agreement or custodian agreement, for actions taken in compliance with any
instruction or direction given to the Indenture Trustee, or for the application
of funds or moneys by the Servicer until such time as funds are received by the
Indenture Trustee.

          Section 6.20 Special Circumstances Leading to Resignation of Indenture
Trustee. Because the Indenture Trustee serves as trustee hereunder for
Obligations of different priorities, it is possible that circumstances may arise
that will cause the Indenture Trustee to resign from its position as trustee for
one or more of the Obligations. In the event that the Indenture Trustee makes a
determination that it should so resign, due to the occurrence of an Event of
Default or potential default hereunder, or otherwise, the Issuer may permit such
resignation as to one or more of the Obligations or request the Indenture
Trustee's resignation as to all Obligations, as the Issuer may elect. If the
Issuer should determine that a conflict of interest has arisen as to the
trusteeship of any of the Obligations, it may authorize and execute a
Supplemental Indenture with one or more successor Indenture Trustees, under
which the administration of certain of the Obligations would be separated from
the administration of the other Obligations.

          Section 6.21 Survival of Indenture Trustee's Rights to Receive
Compensation, Reimbursement and Indemnification. The Indenture Trustee's rights
to receive compensation, reimbursement and indemnification of money due and
owing hereunder at the time of the Indenture Trustee's resignation or removal
shall survive the Indenture Trustee's resignation or removal.


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<PAGE>

          Section 6.22 Corporate Trustee Required; Eligibility; Conflicting
Interests. There shall at all times be an Indenture Trustee hereunder that shall
be eligible to act as Indenture Trustee under TIA Section 310(a)(1) and shall
have a combined capital and surplus of at least $50,000,000. If such corporation
publishes reports of condition at least annually, pursuant to law or the
requirements of federal, state, territorial or District of Columbia supervising
or examining authority, then for the purposes of this Section 6.22, the combined
capital and surplus of such corporation shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. If at any time the Indenture Trustee shall cease to be eligible in
accordance with the provisions of this Section 6.22, it shall resign immediately
in the manner and with the effect specified in this Article VI. Neither the
Issuer nor any Person directly or indirectly controlling or controlled by, or
under common control with, the Issuer shall serve as Indenture Trustee.

          Section 6.23 Payment of Taxes and Other Governmental Charges.

          (a) The Indenture Trustee shall request, and Noteholders shall
provide, all appropriate tax certifications and forms necessary to enable the
Issuer or its agents, to determine their duties and liabilities with respect to
any taxes or other charges that they may be required to pay, deduct or withhold
in respect of the Notes under any present or future law or regulation of the
United States or any present or future law or regulation of any political
subdivision thereof or taxing authority therein or to comply with any reporting
or other requirements under any law or regulation, and to pay, deduct or
withhold any such taxes or charges and remit them to the relevant taxing
authorities as required under law. Such certification shall take the form of a
correct, complete and executed U.S. Internal Revenue Service Form W-8BEN,
W-8ECI, W-8IMY, or W-9 (or any successors thereto), including appropriate
attachments, as applicable, that identifies such Noteholder.

          (b) If such forms are not provided or if any tax or other governmental
charge shall otherwise become payable by or on behalf of the Indenture Trustee,
including any tax or governmental charge required to be withheld from any
payment made by the Indenture Trustee under the provisions of any applicable law
or regulation with respect to any Trust Property or the Notes, such tax or
governmental charge shall be payable by the Noteholder and may be withheld by
the Indenture Trustee. The Issuer and the Indenture Trustee shall have the right
to refuse the surrender, registration of transfer or exchange of any Note with
respect to which such tax or other governmental charge shall be payable until
such payment shall have been made by the Noteholder.

          Section 6.24 Indenture Trustee May File Proofs of Claim. In case of
the pendency of any receivership, insolvency, liquidation, bankruptcy,
reorganization, arrangement, adjustment, composition or other judicial
proceeding relative to the Issuer or any other obligor upon the Notes or the
property of the Issuer or of such other obligor or their creditors, the
Indenture Trustee (irrespective of whether the principal of the Notes of any
Series shall then be due and payable as therein expressed or by declaration or
otherwise and irrespective of whether the Indenture Trustee shall have made any
demand on the Issuer for the payment of overdue principal, premium, if any, or
interest) shall be entitled and empowered, by intervention in such proceeding or
otherwise:


                                       46

<PAGE>

          (a) to file and prove a claim for the whole amount, or such lesser
amount as may be provided for in the Notes, of principal (and premium, if any)
and interest, if any, owing and unpaid in respect of the Notes and to file such
other papers or documents as may be necessary or advisable in order to have the
claims of the Indenture Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Indenture Trustee and
its agents and counsel) and of the Noteholders allowed in such judicial
proceeding; and

          (b) to collect and receive any money or other property payable or
deliverable on any such claims and to distribute the same; and any custodian,
receiver, assignee, trustee, liquidator, sequestrator (or other similar
official) in any such judicial proceeding is hereby authorized by each
Noteholder of Notes to make such payments to the Indenture Trustee, and if the
Indenture Trustee shall consent to the making of such payments directly to the
Noteholders, to pay to the Indenture Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Indenture
Trustee and any predecessor Indenture Trustee, their agents and counsel, and any
other amounts due the Indenture Trustee or any predecessor Indenture Trustee.

          Nothing herein contained shall be deemed to authorize the Indenture
Trustee to authorize or consent to or accept or adopt on behalf of any
Noteholder of a Note any plan of reorganization, arrangement, adjustment or
composition affecting the Notes or the rights of any Noteholder thereof, or to
authorize the Indenture Trustee to vote in respect of the claim of any
Noteholder of a Note in any such proceeding.

          In any proceedings brought by the Indenture Trustee (and also any
proceedings involving the interpretation of any provision of this Indenture to
which the Indenture Trustee shall be a party), the Indenture Trustee shall be
held to represent all the Noteholders, and it shall not be necessary to make any
Noteholders parties to any such proceedings.

                                   Article VII

                             Supplemental Indentures

          Section 7.01 Supplemental Indentures Not Requiring Consent of
Noteholders. The Issuer and the Indenture Trustee may, without the consent of or
notice to any of the Noteholders or any holders of Obligations enter into any
indenture or indentures supplemental to this Indenture for any one or more of
the following purposes:

          (a) to cure any ambiguity or defect or omission in this Indenture;

          (b) to grant to or confer upon the Indenture Trustee for the benefit
of the Noteholders any additional benefits, rights, remedies, powers or
authorities that may lawfully be granted to or conferred upon the Noteholders or
the Indenture Trustee;

          (c) to subject to this Indenture additional revenues, properties or
collateral;

          (d) to modify, amend or supplement this Indenture or any Supplemental
Indenture in such manner as to permit the qualification hereof and thereof under
the Trust Indenture Act or any similar federal statute hereafter in effect or to
permit the qualification of the


                                       47

<PAGE>

Notes for sale under the securities laws of the United States of America or of
any of the states of the United States of America, and, if they so determine, to
add to this Indenture or any Supplemental Indenture such other terms, conditions
and provisions as may be permitted by said Trust Indenture Act or similar
federal statute;

          (e) to evidence the appointment of a separate or co-Indenture Trustee
or a co-registrar or transfer agent or the succession of a new Indenture Trustee
hereunder, or any additional or substitute Guaranty Agency or Servicer;

          (f) to add such provisions to or to amend such provisions of this
Indenture as may, in Note Counsel's opinion, be necessary or desirable to assure
implementation of the Program in conformance with the Act if along with such
Supplemental Indenture there is filed a Note Counsel's opinion to the effect
that the addition or amendment of such provisions will in no way impair the
existing security of the Noteholders or any holders of Outstanding Obligations;

          (g) to make any change as shall be necessary in order to obtain and
maintain for any of the Notes an investment grade Rating from a nationally
recognized rating service, which changes, in the opinion of the Indenture
Trustee are not to the prejudice of the Noteholder of any of the Obligations;

          (h) to make any changes necessary to comply with the Act, the
Regulations or the Code and the regulations promulgated thereunder;

          (i) to provide for the issuance of Notes pursuant to the provisions of
Section 1.08 hereof, including the creation of appropriate Funds, Accounts and
Subaccounts with respect to such Notes;

          (j) to make the terms and provisions of this Indenture, including the
lien and security interest granted herein, applicable to a Derivative Product,
and to modify Section 2.03 hereof with respect to any particular Derivative
Product;

          (k) to create any additional Funds or Accounts or Subaccounts under
this Indenture deemed by the Indenture Trustee to be necessary or desirable;

          (l) to amend the Indenture to allow for any Notes to be supported by a
letter of credit or insurance policy or a liquidity agreement, including
amendments with respect to repayment to such a provider on a parity with any
Notes or Derivative Product and providing rights to such provider under this
Indenture, including with respect to defaults and remedies;

          (m) to amend the Indenture to provide for use of a surety bond or
other financial guaranty instrument in lieu of cash and/or Eligible Investments
in all or any portion of the Reserve Fund, so long as such action shall not
adversely affect the Ratings on any of the Notes;

          (n) to make any other change with Rating Agency Confirmation; or

          (o) to make any other change that, in the judgment of the Indenture
Trustee, is not to the material prejudice of the Noteholders or any holders of
Obligations;


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<PAGE>

          provided, however, that nothing in this Section 7.01 shall permit, or
be construed as permitting, any modification of the trusts, powers, rights,
duties, remedies, immunities and privileges of the Indenture Trustee without the
prior written approval of the Indenture Trustee, which approval shall be
evidenced by execution of a Supplemental Indenture.

          The Indenture Trustee shall provide written notice to the Rating
Agencies prior to entering into any Supplemental Indenture for any one or more
of the purposes set forth in paragraphs (a) - (o) above.

          Section 7.02 Supplemental Indentures Requiring Consent of Noteholders.
Exclusive of Supplemental Indentures covered by Section 7.01 hereof and subject
to the terms and provisions contained in this Section 7.02, and not otherwise,
the Noteholders of not less than a majority of the principal amount of each
class of affected Notes and each affected Derivative Product then Outstanding
shall have the right, from time to time, to consent to and approve the execution
by the Issuer and the Indenture Trustee of such Supplemental Indentures as shall
be deemed necessary and desirable by the Indenture Trustee for the purpose of
modifying, altering, amending, adding to or rescinding, in any particular, any
of the terms or provisions contained in this Indenture or in any Supplemental
Indenture; provided, however, that nothing in this Section 7.02 shall permit, or
be construed as permitting (a) without the consent of the Noteholders of each
affected Note and each Derivative Product then Outstanding, (i) an extension of
the maturity date of the principal of or the interest on any Obligation, or (ii)
a reduction in the principal amount of any Obligation or the rate of interest
thereon, or (iii) a privilege or priority of any Obligation or Obligations over
any other Obligation or Obligations except as otherwise provided herein, or (iv)
a reduction in the aggregate principal amount of the Obligations required for
consent to a Supplemental Indenture, or (v) the creation of any lien other than
a lien ratably securing all of the Obligations at any time Outstanding hereunder
except as otherwise provided herein or (b) any modification of the trusts,
powers, rights, obligations, duties, remedies, immunities and privileges of the
Indenture Trustee without the prior written approval of the Indenture Trustee.

          If at any time the Issuer shall request that the Indenture Trustee
enter into any such Supplemental Indenture for any of the purposes in this
Section 7.02, the Indenture Trustee shall be entitled to receive an Opinion of
Counsel from the Issuer that all conditions precedent to the execution of any
Supplemental Indenture have been met. The Indenture Trustee shall, upon being
satisfactorily indemnified with respect to expenses, cause notice of the
proposed execution of such Supplemental Indenture to be mailed by registered or
certified mail to each Noteholder of an Obligation at the address shown on the
registration books or listed in any Derivative Product. Such notice (which shall
be prepared by the Issuer) shall briefly set forth the nature of the proposed
Supplemental Indenture and shall state that copies thereof are on file at the
principal corporate trust office of the Indenture Trustee for inspection by all
Noteholders. If, within 60 days, or such longer period as shall be prescribed by
the Issuer, following the mailing of such notice, the Noteholders of not less
than a majority of the principal amount of each class of affected Notes and each
affected Derivative Product then Outstanding at the time of the execution of any
such Supplemental Indenture shall have consented in writing to and approved the
execution thereof as herein provided, no Noteholder of any Obligation shall have
any right to object to any of the terms and provisions contained therein, or the
operation thereof, or in any manner to question the propriety of the execution
thereof, or to enjoin or restrain the Indenture


                                       49

<PAGE>

Trustee or the Issuer from executing the same or from taking any action pursuant
to the provisions thereof.

          The Indenture Trustee shall provide written notice to the Rating
Agencies prior to entering into any Supplemental Indenture for any of the
purposes in this Section 7.02.

          Upon the execution of any such Supplemental Indenture as in this
Section 7.02 permitted and provided, this Indenture shall be and be deemed to be
modified and amended in accordance therewith.

          Section 7.03 Additional Limitation on Modification of Indenture. None
of the provisions of this Indenture (including Sections 7.01 and 7.02 hereof)
shall permit an amendment to the provisions of the Indenture that permits the
transfer of all or part of the Financed Student Loans that were originated under
the Act or granting of a security interest therein to any Person other than an
Eligible Lender or the Servicer, unless the Act or Regulations are hereafter
modified so as to permit the same.

          Section 7.04 Notice of Defaults. Within 90 days after the occurrence
of any default hereunder with respect to the Notes, the Indenture Trustee shall
transmit in the manner and to the extent provided in TIA Section 313(c), notice
of such default hereunder known to the Indenture Trustee, unless such default
shall have been cured or waived; provided, however, that, except in the case of
a default in the payment of the principal of (or premium, if any) or interest
with respect to any Note, or in the payment of any sinking fund installment with
respect to the Notes, the Indenture Trustee shall be protected in withholding
such notice if and so long as an authorized officer of the Indenture Trustee in
good faith determines that the withholding of such notice is in the interest of
the Noteholders. For the purpose of this Section 7.04, the term "default" means
any event that is, or after notice or lapse of time or both would become, an
Event of Default with respect to the Notes.

          Section 7.05 Conformity with the Trust Indenture Act. Every
Supplemental Indenture executed pursuant to this Article VII shall conform to
the requirements of the Trust Indenture Act as then in effect.

                                  Article VIII

                               General Provisions

          Section 8.01 Notices. Any notice, request or other instrument required
by this Indenture to be signed or executed by the holders of Obligations may be
executed by the execution of any number of concurrent instruments of similar
tenor, and may be signed or executed by such holders of Obligations in person or
by agent appointed in writing. As a condition for acting thereunder the
Indenture Trustee may demand proof of the execution of any such instrument and
of the fact that any person claiming to be the owner of any of said Obligations
is such owner and may further require the actual deposit of such Obligation or
Obligations with the Indenture Trustee. The fact and date of the execution of
such instrument may be proved by the certificate of any officer in any
jurisdiction who by the laws thereof is authorized to take acknowledgments of
deeds within such jurisdiction, that the person signing


                                       50

<PAGE>

such instrument acknowledged before him the execution thereof, or may be proved
by any affidavit of a witness to such execution sworn to before such officer.

          The amount of Notes held by any person executing such instrument as a
Noteholder and the fact, amount, and numbers of the Notes held by such Person
and the date of his holding the same may be proved by a certificate executed by
any responsible trust company, bank, banker, or other depository in a form
approved by the Indenture Trustee, showing that at the date therein mentioned
such person had on deposit with such depository the Notes described in such
certificate; provided, however, that at all times the Indenture Trustee may
require the actual deposit of such Note or Notes with the Indenture Trustee.

          All notices, requests and other communications to any party hereunder
shall be in writing (including bank wire, telex, telecopy or facsimile or
similar writing) at the following addresses, and each address shall constitute
each party's respective "Corporate Trust Office" for purposes of the Indenture:

          If intended for the Issuer:

                   Education Funding Capital Trust-I
                   c/o Fifth Third Bank
                   MD 10AT60
                   38 Fountain Square Plaza
                   Cincinnati, Ohio 45263
                   Attention: Corporate Trust Administration
                   Telephone: +1.513.534.3367
                   Facsimile: +1.513.534.6785

                   with a copy to:

                   Wilmington Trust Company
                   Rodney Square North
                   1100 North Market Street
                   Wilmington, Delaware 19890-0001
                   Attention: Corporate Trust Administration
                   Telephone: +1.203.975.6112
                   Facsimile: +1.203.975.6299

          If intended for the Indenture Trustee:

                   Fifth Third Bank
                   MD 10AT60
                   38 Fountain Square Plaza
                   Cincinnati, Ohio 45263
                   Attention: Corporate Trust Administration
                   Telephone: +1.513.534.3367
                   Facsimile: +1.513.534.6785


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<PAGE>

Any party may change the address to which subsequent notices to such party are
to be sent, or of its principal office, by notice to the others, delivered by
hand or received by telex or telecopier or registered first-class mail, postage
prepaid. Each such notice, request or other communication shall be effective
when delivered by hand or received by telex or telecopier or first-class mail,
postage prepaid.

          Section 8.02 Covenants Bind Issuer. The covenants, agreements,
conditions, promises, and undertakings in this Indenture shall extend to and be
binding upon the successors and assigns of the Issuer, and all of the covenants
hereof shall bind such successors and assigns, and each of them, jointly and
severally. All the covenants, conditions, and provisions hereof shall be held to
be for the sole and exclusive benefit of the parties hereto and their successors
and assigns and of the Noteholders from time to time of the Obligations.

          No extension of time of payment of any of the Obligations shall
operate to release or discharge the Issuer, it being agreed that the liability
of the Issuer, to the extent permitted by law, shall continue until all of the
Obligations are paid in full, notwithstanding any transfer of Financed Student
Loans or extension of time for payment.

          Section 8.03 Lien Created. This Indenture shall operate effectually as
(a) a grant of lien on and security interest in, and (b) an assignment of, the
Trust Estate.

          Section 8.04 Severability of Lien. If the lien of this Indenture shall
be or shall ever become ineffectual, invalid, or unenforceable against any part
of the Trust Estate, which is not subject to the lien because of want of power
or title in the Issuer, the inclusion of any such part shall not in any way
affect or invalidate the pledge and lien hereof against such part of the Trust
Estate as to which the Issuer in fact had the right to pledge.

          Section 8.05 Consent of Noteholders Binds Successors. Any request or
consent of the Noteholder of any Obligations given for any of the purposes of
this Indenture shall bind all future Noteholders of the same Obligation or any
Obligations issued in exchange therefor or in substitution thereof in respect of
anything done or suffered by the Issuer or the Indenture Trustee in pursuance of
such request or consent.

          Section 8.06 Nonpresentment of Notes or Interest Checks. Should any of
the Notes or interest checks not be presented for payment when due, the
Indenture Trustee shall retain from any money transferred to it for the purpose
of paying the Notes or interest checks so due, for the benefit of the
Noteholders thereof, a sum of money sufficient to pay such Notes or interest
checks when the same are presented by the Noteholders thereof for payment. Such
money shall not be required to be invested. All liability of the Issuer to the
Noteholders of such Notes or interest checks and all rights of such Noteholders
against the Issuer under the Notes or interest checks or under this Indenture
shall thereupon cease and determine, and the sole right of such Noteholders
shall thereafter be against such deposit. If any Note or interest check shall
not be presented for payment within the period of two years following its
payment or redemption date, the Indenture Trustee shall return to the Issuer the
money theretofore held by it for payment of such Note or interest check, and
such Note or interest check shall (subject to the defense of any applicable
statute of limitation) thereafter be an unsecured obligation of the Issuer. The


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<PAGE>

Indenture Trustee's responsibility for any such money shall cease upon
remittance thereof to the Issuer.

          Section 8.07 Laws Governing. It is the intent of the parties hereto
that this Indenture shall be construed in accordance with the laws of Ohio
without reference to its conflict of law provisions. This Indenture is subject
to those provisions of the TIA that are required to be part of this Indenture
and shall, to the extent applicable, be governed by such provisions.

          Section 8.08 Severability. If any covenant, agreement, waiver, or part
thereof contained in this Indenture be forbidden by any pertinent law or under
any pertinent law be effective to render this Indenture invalid or unenforceable
or to impair the lien hereof, then each such covenant, agreement, waiver, or
part thereof shall itself be and is hereby declared to be wholly ineffective,
and this Indenture shall be construed as if the same were not included herein.

          Section 8.09 Exhibits. The terms of the Schedules and Exhibits, if
any, attached to this Indenture are incorporated herein in all particulars.

          Section 8.10 Non-Business Days. Except as may otherwise be provided
herein, if the date for making payment of any amount hereunder or on any Note,
or if the date for taking any action hereunder, is not a Business Day, then such
payment can be made without accruing further interest or action can be taken on
the next succeeding Business Day, with the same force and effect as if such
payment were made when due or action taken on such required date.

          Section 8.11 Parties Interested Herein. Nothing in this Indenture
expressed or implied is intended or shall be construed to confer upon, or to
give to, any Person or entity, other than the Indenture Trustee, the paying
agent, if any, and the holders of the Obligations, any right, remedy or claim
under or by reason of this Indenture or any covenant, condition or stipulation
hereof, and all covenants, stipulations, promises and agreements in this
Indenture contained by and on behalf of the Issuer are for the sole and
exclusive benefit of the Indenture Trustee, the paying agent, if any, and the
holders of the Obligations.

          Section 8.12 Obligations are Limited Obligations. The Notes and the
obligations of the Issuer contained in this Indenture are special, limited
obligations of the Issuer, secured by and payable solely from the Trust Estate
herein provided. The Issuer shall not be obligated to pay the Notes, the
interest thereon, or any other obligation created by or arising from this
Indenture from any other source.

          Section 8.13 Counterparty Rights. Notwithstanding any provision of
this Indenture, no Counterparty that shall be in default under any Derivative
Product with the Issuer shall have any of the rights granted to a Counterparty
or as the Noteholder of an Obligation hereunder.

          Section 8.14 Disclosure of Names and Addresses of Noteholders.
Noteholders by receiving and holding the same, agree with the Issuer and the
Indenture Trustee that neither the Issuer nor the Indenture Trustee nor any
Securities Depository shall be held accountable by reason of the disclosure of
any information as to the names and addresses of the Noteholders in accordance
with TIA Section 312, regardless of the source from which such information was


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<PAGE>

derived, and that the Indenture Trustee shall not be held accountable by reason
of mailing any material pursuant to a request made under TIA Section 312(b).

          Section 8.15 Aggregate Principal Amount of Obligations. Whenever in
this Indenture reference is made to the aggregate principal amount of any
Obligations, such phrase shall mean, at any time, the principal amount of any
Notes and the Derivative Value of any Derivative Product.

          Section 8.16 Financed Student Loans. The Issuer expects to acquire
Student Loans and to pledge Student Loans to the Indenture Trustee, in
accordance with this Indenture, which Student Loans, upon becoming subject to
the lien of this Indenture, constitute Financed Student Loans, as defined
herein. If for any reason a Financed Student Loan does not constitute a Student
Loan, or ceases to constitute a Student Loan, such loan shall continue to be
subject to the lien of this Indenture as a Financed Student Loan.

          Section 8.17 Limitation of Liability of the Co-Owner Trustee. It is
expressly understood and agreed by the parties hereto that (a) this Indenture is
executed and delivered by the Co-Owner Trustee, not individually or personally
but solely as trustee of the Issuer, in the exercise of the powers and authority
conferred and vested in it under the Trust Agreement, (b) each of the
representations, undertakings and agreements herein made on the part of the
Issuer is made and intended not as personal representations, undertakings and
agreements by the Co-Owner Trustee but is made and intended for the purpose of
binding only the Issuer, and (c) under no circumstances shall the Co-Owner
Trustee be personally liable for the payment of any indebtedness or expenses of
the Issuer or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Issuer under this
Indenture or the other Basic Documents.

                                   Article IX

                        Payment and Cancellation of Notes
                          and Satisfaction of Indenture

          Section 9.01 Trust Irrevocable. The trust created by the terms and
provisions of this Indenture is irrevocable until the indebtedness secured
hereby (the Notes and interest thereon) and all Issuer Derivative Payments are
fully paid or provision made for their payment as provided in this Article IX.

          Section 9.02 Satisfaction of Indenture.

          (a) If the Issuer shall pay, or cause to be paid, or there shall
otherwise be paid (i) to the Noteholders, the principal of and interest on the
Notes, at the times and in the manner stipulated in this Indenture and (ii) to
each Counterparty, all Issuer Derivative Payments then due, then the pledge of
the Trust Estate hereunder, and all covenants, agreements, and other obligations
of the Issuer to the Noteholders shall thereupon cease, terminate, and become
void and be discharged and satisfied. In such event, the Indenture Trustee shall
execute and deliver to the Issuer all such instruments as may be desirable to
evidence such discharge and satisfaction, and the Indenture Trustee shall pay
over or deliver all money held by it under this Indenture to the party entitled
to receive the same under this Indenture.


                                       54

<PAGE>

          (b) Any Issuer Derivative Payments are deemed to have been paid and
the applicable Derivative Product terminated when payment of all Issuer
Derivative Payments due and payable to each Counterparty under its respective
Derivative Product have been made or duly provided for to the satisfaction of
each Counterparty and the respective Derivative Product has been terminated.

          (c) In no event shall the Indenture Trustee deliver over to the Issuer
any Financed Student Loans that were originated under the Act unless the Issuer
is an Eligible Lender, if the Act or Regulations then in effect require the
owner or holder of such Financed Student Loans to be an Eligible Lender.

          Section 9.03 Cancellation of Paid Notes. Any Notes that have been paid
or purchased by the Issuer, mutilated Notes replaced by new Notes, and any
temporary Notes for which definitive Notes have been delivered shall (unless
otherwise directed by the Issuer by Issuer Order) forthwith be cancelled by the
Indenture Trustee and, except for temporary Notes, returned to the Issuer.

                                    Article X

                                   Termination

          Section 10.01 Termination of the Trust.

          (a) The trust created by this Indenture shall terminate upon the later
of (A) payment to the Noteholders and to the Indenture Trustee of all amounts
required to be paid to them pursuant to this Indenture and any Supplemental
Indenture and the disposition of all property held as part of the Trust Estate
or (B) the day following the date on which all reimbursement obligations to the
Counterparties, if any, and any other Person as may be provided for in any
Supplemental Indenture have been paid in full. The Issuer shall promptly notify
the Indenture Trustee of any prospective termination pursuant to this Section
10.01.

          (b) Notice of any prospective termination, specifying the Payment Date
for payment of the final distribution and requesting the surrender of the Notes
for cancellation, shall be given promptly by the Indenture Trustee by letter to
Noteholders mailed not less than 10 nor more than 15 days preceding the
specified Payment Date stating (i) the Payment Date upon which final payment of
the Notes shall be made, (ii) the amount of any such final payment, and (iii)
the location for presentation and surrender of the Notes. Payment of the final
distribution that shall be made only upon presentation and surrender of the
Notes at the corporate trust office of the Indenture Trustee specified in the
notice.

          Section 10.02 Notice. The Indenture Trustee shall give notice of
termination of the trust created by this Indenture to the Issuer and each Rating
Agency.

                                   Article XI

                             Reporting Requirements


                                       55

<PAGE>

          Section 11.01 Annual Statement as to Compliance. The Servicer will
deliver to each Rating Agency, the Indenture Trustee and the Issuer, on or
before March 31 of each year, beginning with March 31, 2003, a certificate
stating that (a) a review of the activities of the Servicer during the preceding
calendar year and of its performance under the Servicing Agreement has been made
under the supervision of the officer signing such certificate and (b) to the
best of such officers' knowledge, based on such review, the Servicer has
fulfilled all its obligations under the Servicing Agreement throughout such
year, or, there has been a default in the fulfillment of any such obligation,
specifying each such default known to such officer and the nature and status
thereof.

          Section 11.02 Annual Independent Public Accountant's Servicing Report.
On or before March 31 of each year, beginning March 31, 2003, the Servicer at
its expense shall cause an independent public accountant that is a member of the
American Institute of Certified Public Accountants to furnish a statement to
each Rating Agency, the Issuer and the Indenture Trustee to the effect that such
accountant has examined certain documents and records relating to the servicing
of the Financed Student Loans (during the preceding fiscal year) under servicing
agreements substantially similar one to another and to the Servicing Agreement
and that, on the basis of such examination, such servicing has been conducted in
compliance with such servicing agreements except for such significant exceptions
or errors in records that, in the opinion of such accountant, requires it to
report and that are set forth in such report.

          Section 11.03 Servicer's Certificate. Each month, not later than the
twenty-fifth day of each month, the Servicer shall deliver to the Indenture
Trustee, a certificate certified by an officer of the Servicer certifying to the
accuracy of the monthly statement contemplated by Section 11.04.

          Section 11.04 Statements to Noteholders. On or before the fifteenth
day of each month, the Issuer shall provide or cause to be provided to the
Indenture Trustee (with a copy to the Rating Agencies) for the Indenture Trustee
to forward within 5 days of receipt to each Noteholder, a statement setting
forth information with respect to the Notes and Financed Student Loans as of the
end of the preceding month, including the following to the extent applicable;

          (a) the amount of payments with respect to each Series of Notes paid
with respect to principal during the preceding month;

          (b) the amount of payments with respect to each Series of Notes paid
with respect to interest during the preceding month;

          (c) the amount of the payments allocable to any interest that was
carried over together with the amount of any remaining outstanding interest that
was carried over;

          (d) the principal balance of Financed Student Loans as of the close of
business on the last day of the preceding month;

          (e) the aggregate outstanding principal amount of the Notes of each
Series as of the close of business on the last day of the preceding month, after
giving effect to payments allocated to principal reported under clause (a)
above;


                                       56

<PAGE>

          (f) the interest rate for any Series of variable rate Notes,
indicating how such interest rate is calculated;

          (g) the amount of the servicing fees allocated to the Servicer as of
the close of business on the last day of the preceding month;

          (h) the amount of the administration fee, the auction agent fee,
market agent fee, calculation agent fee and the trustee fee, if any, allocated
as of the close of business on the last day of the preceding month;

          (i) the amount of the Recoveries of Principal and interest received
during the preceding month relating to Financed Student Loans;

          (j) the amount of the payment attributable to moneys in the
Capitalized Interest Fund, the amount of any other withdrawals from the
Capitalized Interest Fund and the balance of the Capitalized Interest Fund as of
the close of business on the last day of the preceding month;

          (k) the amount of the payment attributable to moneys in the Reserve
Fund, the amount of any other withdrawals from the Reserve Fund and the balance
of the Reserve Fund as of the close of business on the last day of the preceding
month;

          (l) the portion, if any, of the payments attributable to amounts on
deposit in the Acquisition Fund;

          (m) the aggregate amount, if any, paid by the Indenture Trustee to
acquire Student Loans from amounts on deposit in the Acquisition Fund during the
preceding month;

          (n) the amount remaining in the Acquisition Fund that has not been
used to acquire Student Loans and is being transferred to the Revenue Fund;

          (o) the aggregate amount, if any, paid for Financed Student Loans
purchased from the Trust during the preceding month;

          (p) the number and principal amount of Financed Student Loans, as of
the close of business on the last day of the preceding month, (A) that are (i)
11 to 30 days delinquent, 31 to 60 days delinquent, (ii) 61 to 90 days
delinquent, (iii) 91 to 120 days delinquent, (iv) 121 to 150 days delinquent,
(v) 151 to 180 days delinquent, (vi) greater than 180 days delinquent, and (B)
for which claims have been filed with the appropriate Guaranty Agency and that
are awaiting payment;

          (q) the Value of the Trust Estate and the Outstanding principal amount
of the Notes as of the close of business on the last day of the preceding month;

          (r) the number and percentage by dollar amount of (i) initial federal
reimbursement claims for Financed Student Loans and (ii) rejected federal
reimbursement claims for Financed Student Loans;


                                       57

<PAGE>

          (s) principal balance of Financed Student Loans in each of the
following statuses: (i) forbearance, (ii) deferment, (iii) claims, (iv)
in-school, (v) grace, and (vi) repayment; and

          (t) the principal balance of Financed Student Loans by loan type as of
the close of business on the last day of the preceding month.

          Each amount set forth pursuant to paragraph (a), (b), (g) and (h)
above shall be expressed as a dollar amount per authorized denomination of a
Note. A copy of the statements referred to above may be obtained by any
Noteholder by a written request to the Indenture Trustee, addressed to its
Corporate Trust Office.

                  [Remainder of page intentionally left blank.]


                                       58

<PAGE>

          In Witness Whereof, the Issuer, the Indenture Trustee, and the Trust
Eligible Lender Trustee have caused this Indenture to be duly executed by their
respective officers, thereunto duly authorized and duly attested, all as of the
day and year first above written.

                                       Education Funding Capital Trust-I, by
                                          Fifth Third Bank, not in its
                                          individual capacity, but solely as
                                          Co-Owner Trustee on behalf of the
                                          Trust

                                       By: /s/ Keith E. Brock
                                           _____________________________________
                                           Name:   Keith E. Brock
                                           Title:  Trust Officer

                                       Fifth Third Bank, not in its individual
                                          capacity but solely as Indenture
                                          Trustee


                                       By: /s/ Keith E. Brock
                                           _____________________________________
                                           Name:   Keith E. Brock
                                           Title:  Trust Officer

                                       Acknowledged and accepted as to the
                                       Granting Clauses as of the day and year
                                       first above written:

                                       Fifth Third Bank, not in its individual
                                          capacity but solely as Trust Eligible
                                          Lender Trustee


                                       By: /s/ Keith E. Brock
                                           _____________________________________
                                           Name:   Keith E. Brock
                                           Title:  Trust Officer

          Grad Partners, Inc. hereby acknowledges and accepts the duties and
obligations assigned to the Servicer in Article XI hereof.

                                       Grad Partners, Inc., as Servicer

                                       By: /s/ Perry D. Moore
                                           _____________________________________
                                           Name:   Perry D. Moore
                                           Title:  Senior VP-Finance


<PAGE>

                                                                       Exhibit A

                      Student Loan Acquisition Certificate

          This Student Loan Acquisition Certificate (this "Certificate") is
submitted pursuant to the provisions of Section 4.02 of the Indenture of Trust
dated as of May 1, 2002 (the "Indenture") among Education Funding Capital
Trust-I (the "Issuer"), Fifth Third Bank, as Indenture Trustee, and Fifth Third
Bank, as Trust Eligible Lender Trustee. All capitalized terms used in this
Certificate and not otherwise defined herein shall have the same meanings given
to such terms in the Indenture. In your capacity as Indenture Trustee, you are
hereby authorized and requested to disburse to Grad Partners, Inc. the sum of
$__________ (or, in the case of an exchange, the Student Loans listed in Exhibit
A hereto) for the acquisition of Student Loans. With respect to the Student
Loans so to be acquired, the Issuer hereby certifies as follows:

          1. The Student Loans to be acquired are those specified in Schedule A
attached hereto (the "Acquired Student Loans"). The remaining unpaid principal
amount of each Acquired Student Loan is as shown on such Schedule A.

          2. The amount to be disbursed pursuant to this Certificate does not
exceed the amount permitted by Section 4.02 of the Indenture (or, if a Financed
Student Loan is being sold in exchange for an Acquired Student Loan under the
Indenture, the aggregate unpaid principal amount of, and accrued interest on,
such Financed Student Loan does not exceed the amount permitted by Section 4.02
of the Indenture).

          3. Each Acquired Student Loan is an Student Loan authorized so to be
acquired by the Indenture.

          4. You have been previously, or are herewith, provided with the
following items (the items listed in (a), (b), (c), (d), (f) and (g) have been
received and are being retained, on your behalf, by the Issuer or the Servicer):

          (a) a copy of the Depositor Transfer and Sale Agreement between the
Issuer and the Eligible Lender with respect to the Acquired Student Loans;

          (b) with respect to each Insured Student Loan included among the
Acquired Student Loans, the Certificate of Insurance relating thereto;

          (c) with respect to each Guaranteed Student Loan included among the
Acquired Student Loans, a certified copy of the Guarantee Agreement relating
thereto;

          (d) an Opinion of Counsel to the Issuer specifying each action
necessary to perfect a security interest in all Student Loans to be acquired by
the Issuer pursuant to the Depositor Transfer and Sale Agreement in favor of the
Indenture Trustee in the manner provided for by the provisions of 20 U.S.C.(ss)
1087-2(d)(3) or 20 U.S.C. (ss) 1082 (m)(1)(D)(iv), as applicable (you are
authorized to rely on the advice of a single blanket Opinion of Counsel to the
Issuer until such time as the Issuer shall provide any amended opinion to you);

<PAGE>

          (e) a certificate of an Authorized Officer of the Issuer to the effect
that (i) the Issuer is not in default in the performance of any of its covenants
and agreements made in the Depositor Transfer and Sale Agreement relating to the
Acquired Student Loans; (ii) with respect to all Acquired Student Loans that are
Insured, Insurance is in effect with respect thereto, and with respect to all
Acquired Student Loans that are Guaranteed, the Guarantee Agreement is in effect
with respect thereto; and (iii) the Issuer is not in default in the performance
of any of its covenants and agreements made in any Contract of Insurance or the
Guarantee Agreement applicable to the Acquired Student Loans;

          (f) evidence that the promissory notes evidencing the Acquired Student
Loans have had stamped thereon or affixed thereto (individually or by blanket
endorsement) a notice specifying that they have been assigned to the Indenture
Trustee with all necessary endorsements; and

          (g) instruments duly assigning the Acquired Student Loans to the
Indenture Trustee.

          5.  The Issuer is not, on the date hereof, in default under the
Indenture or in the performance of any of its covenants and agreements made in
the Depositor Transfer and Sale Agreement relating to the Acquired Student
Loans, and, to the best knowledge of the Issuer, the Eligible Lender is not in
default under the Transfer and Sale Agreements applicable to the Acquired
Student Loans. The Issuer is not aware of any default existing on the date
hereof under any of the other documents referred to in paragraph 4 hereof, nor
of any circumstances that would reasonably prevent reliance upon the Opinion of
Counsel referred to in paragraphs 4(d) hereof.

          6.  All of the conditions specified in the Depositor Transfer and Sale
Agreement applicable to the Acquired Student Loans and the Indenture for the
acquisition of the Acquired Student Loans and the disbursement hereby authorized
and requested have been satisfied; provided that the Issuer may waive the
requirement of receiving an Opinion of Counsel from the counsel to the Lender.

          7.  If a Financed Student Loan is being sold in exchange for an
Acquired Student Loan, the final expected maturity date of such Acquired Student
Loan shall be substantially similar to that of the Financed Student Loan being
sold and such sale and exchange shall not adversely affect the ability of the
Trust Estate to make timely principal and interest payments on its Obligations.

          8.  With respect to all Acquired Student Loans that are Insured,
Insurance is in effect with respect thereto, and with respect to all Acquired
Student Loans that are Guaranteed, the Guarantee Agreement is in effect with
respect thereto.

          9.  The Issuer is not in default in the performance of any of its
covenants and agreements made in any Contract of Insurance or the Guarantee
Agreement applicable to the Acquired Student Loans.

          10. The undersigned is authorized to sign and submit this Certificate
on behalf of the Issuer.


                                       2

<PAGE>

          11. Student Loans are being acquired at a price that permits the
results of the Cash Flows provided to the Rating Agencies on the Date of
Issuance to be sustained.

                  [Remainder of page intentionally left blank.]


                                       3

<PAGE>

          Witness my hand this ___ day of May 2002.

                                       Education Funding Capital Trust-I, by
                                           Fifth Third Bank, not in its
                                           individual capacity, but solely as
                                           Co-Owner Trustee on behalf of the
                                           Trust

                                       By: _____________________________________
                                           Name:
                                           Title:


                                       4

<PAGE>

                                                                       EXHIBIT B

                              Form of Issuer Order

                        Education Funding Capital Trust-I

Issuer Order for the transfer of moneys from the Revenue Fund to the Operating
Fund pursuant to Section 4.03 of the Base Indenture.

To:  Fifth Third Bank, as indenture trustee (the "Indenture Trustee") under the
     Indenture of Trust dated as of May 1, 2002 (the "Base Indenture") among
     Education Funding Capital Trust-I (the "Issuer"), Fifth Third Bank, as
     trust eligible lender trustee, and Fifth Third Bank, as Indenture Trustee,
     as supplemented by the 2002-1 Series A&B Supplemental Indenture of Trust of
     even date therewith (the "Indenture Supplement" and collectively with the
     Base Indenture, the "Indenture")

Ladies and Gentlemen:

          Pursuant to Section 4.03 of the Base Indenture, you hereby are
authorized and directed to transfer moneys in the Revenue Fund, on any date, to
the Operating Fund, subject to Section 4.07 of the Base Indenture.

                                       Very truly yours,

                                       Education Funding Capital Trust-I, by
                                           Fifth Third Bank, not in its
                                           individual capacity, but solely as
                                           Co-Owner Trustee on behalf of the
                                           Trust

                                       By: _____________________________________
                                           Name:
                                           Title:
Dated: __________ 200__

<PAGE>

                                                                      SCHEDULE A

                          Student Loans To Be Acquired


<PAGE>

                                                                      Appendix A

                              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 agreement or instrument incorporating this Appendix and in any
certificate or other document made or delivered pursuant thereto unless
otherwise defined therein.

          (b) As used herein, in any agreement or instrument incorporating this
Appendix and in any certificate or other document made or delivered pursuant
thereto, accounting terms not defined in this Appendix or in any such agreement
or instrument, certificate or other document, and accounting terms partly
defined in this Appendix or in any such agreement or 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 agreement or 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 agreement or instrument, certificate or other document shall control.

          (c) The words "hereof," "herein," "hereunder," and words of similar
import when used in an agreement or instrument refer to such agreement or
instrument as a whole and not to any particular provision or subdivision
thereof; references in an agreement or 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
agreement or 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.

          (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.


                                       1

<PAGE>

                                   Definitions

                                    --------

"Accounts" shall mean any accounts established pursuant to the Indenture.

"Acquisition Fund" shall mean the Fund bearing that name established pursuant to
Section 4.01(a) of the Indenture, including any Accounts and Subaccounts created
therein.

"Act" shall mean the Higher Education Act of 1965, as amended, together with any
rules, regulations and interpretations thereunder.

"Add-on Consolidation Loan" shall mean a Student Loan included in the Trust
Estate, the principal balance of which is added to an existing Consolidation
Loan during the Add-on Period, as required by the Act.

"Add-on Period" shall mean, for each Series of Notes issued under the Indenture,
the period of 180 days after the last date of origination of any Consolidation
Loan acquired by the Issuer with the proceeds of such Note offering.

"Administration Agreement" shall mean the Administration Agreement dated as of
May 1, 2002, between the Issuer and the Administrator.

"Administration Fee" shall have the meaning set forth in the Administration
Agreement.

"Administrator" shall mean Grad Partners, Inc., in its capacity as administrator
of the Issuer and the Financed Student Loans, and any successor thereto.

"Administrator Default" shall have the meaning set forth in Section 12 of the
Administration Agreement.

"Administrator's Certificate" shall mean the certificate of the Administrator
delivered pursuant to Section 2(b)(ii) of the Administration Agreement.

"Affiliate" shall mean, 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
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.

"Auction Agent Agreement" when used with respect to any Series of Notes, shall
have the meaning given to such term in the Supplemental Indenture authorizing
the issuance of such Notes.

"Authorized Officer" shall mean (i) with respect to the Issuer, any officer of
the Co-Owner Trustee or Administrator who is authorized to act for the Co-Owner
Trustee or Administrator in matters relating to the Issuer pursuant to the Basic
Documents and who is identified on the lists


                                       2

<PAGE>

of Authorized Officers delivered by the Co-Owner Trustee and Administrator to
the Indenture Trustee on a Closing Date (as such list may be modified or
supplemented from time to time thereafter) and (ii) with respect to the
Depositor, the Seller, the Servicer and the Administrator, any officer or other
authorized representative of the Seller, the Servicer or the Administrator,
respectively, who is authorized to act for the Depositor, the Seller, the
Servicer or the Administrator, respectively, in matters relating to itself or to
the Issuer and to be acted upon by the Depositor, the Seller, the Servicer or
the Administrator, respectively, pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Depositor, the
Seller, the Servicer and the Administrator, respectively, to the Indenture
Trustee on a Closing Date (as such list may be modified or supplemented from
time to time thereafter).

"Basic Documents" shall mean the Trust Agreement, the Indenture, the
Supplemental Indentures, the Eligible Lender Trust Agreements, the Transfer and
Sale Agreements, the Servicing Agreement, the Subservicing Agreements, the
Administration Agreement, the Guarantee Agreements, the Auction Agent Agreement,
the Market Agent Agreement, the Broker-Dealer Agreements, the Note Purchase
Agreement, any Derivative Product and other documents and certificates delivered
in connection with any thereof.

"Borrower" shall mean an individual who is the maker of a Borrower Note and,
with respect to Guaranteed Student Loans, who obtains a Student Loan from an
"eligible lender" in accordance with the Act and the policies and procedures of
a Federal Guarantor.

"Borrower Note" shall mean a promissory note of a Borrower for a Student Loan,
which promissory note, in the case of Guaranteed Student Loans, shall be set
forth on the appropriate form furnished by the Federal Guarantor and shall meet
the criteria set forth by the Act and the policies and procedures of the Federal
Guarantor.

"Broker-Dealer Agreement" when used with respect to any Series of Notes, shall
have the meaning given to such term in the Supplemental Indenture authorizing
the issuance of such Notes.

"Business Day" shall mean any day other than (i) a Saturday or a Sunday, or (ii)
a day on which banking institutions or trust companies in the State of Ohio, or
in the city in which the Corporate Trust Office of the Indenture Trustee is
located, are authorized or obligated by law, regulation or executive order to
remain closed.

"Capitalized Interest Fund" shall mean the Fund bearing that name established
pursuant to Section 4.01(a) of the Indenture, including any Accounts and
Subaccounts created therein.

"Cash Flows" shall mean cash flow schedules prepared by the Issuer or its
designee, including a listing of all assumptions used in the preparation of such
cash flow schedules, and provided to each Rating Agency. All assumptions used in
the preparation of the Cash Flows shall be reasonable in the judgment of the
Issuer and disclosed in writing to each Rating Agency.

"Certificate of Insurance" shall mean any Certificate evidencing a Financed
Student Loan is Insured pursuant to a Contract of Insurance.


                                       3

<PAGE>

"Clearing Agency" shall mean an organization registered as a "clearing agency"
pursuant to Section 17A of the Exchange Act.

"Closing Date" shall mean the date of issuance of a Series of Notes under the
Indenture.

"Code" shall mean the Internal Revenue Code of 1986, as amended from time to
time. Each reference to a section of the Code herein shall be deemed to include
the United States Treasury Regulations, including applicable temporary and
proposed regulations, relating to such section that are applicable to the Notes
or the use of the proceeds thereof. A reference to any specific section of the
Code shall be deemed also to be a reference to the comparable provisions of any
enactment that supersedes or replaces the Code thereunder from time to time.

"Commission" shall mean the Securities and Exchange Commission.

"Consolidation Loan" shall mean a Student Loan made pursuant to Section 428C of
the Act to consolidate the Borrower's obligations under various federally
authorized student loan programs into a single loan, as supplemented by the
addition of any related Add-on Consolidation Loan.

"Contract of Insurance" shall mean the contract of insurance between the
Eligible Lender and the Secretary.

"Co-Owner Eligible Lender Trust Agreement" shall mean the Eligible Lender Trust
Agreement dated as of May 1, 2002 between the Issuer and the Trust Eligible
Lender Trustee.

"Co-Owner Trustee" shall mean the Fifth Third Bank, not in its individual
capacity, but solely as Co-Owner trustee of the Trust under the Trust Agreement.

"Corporate Trust Office" shall mean (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 at a Closing
Date is located at MD 10AT60, 38 Fountain Square Plaza, Cincinnati, Ohio 45263,
Attention: Corporate Trust Administration (telephone: +1.513.534.3367;
facsimile: +1.513.534.6785) or at such other address as the Indenture Trustee
may designate from time to time by notice to the Noteholders and the Depositor,
or the principal corporate trust office of any successor Indenture Trustee (the
address of which the successor Indenture Trustee will notify the Noteholders and
the Depositor) and (ii) with respect to the Co-Owner Trustee and the Trust
Eligible Lender Trustee, the principal corporate trust offices of the Co-Owner
Trustee and the Trust Eligible Lender Trustee located at MD 10AT60, 38 Fountain
Square Plaza, Cincinnati, Ohio 45263, Attention: Corporate Trust Administration
(telephone: +1.513.534.3367; facsimile: +1.513.534.6785) or at such other
address as the Co-Owner Trustee or the Trust Eligible Lender Trustee may
designate by notice to the Depositor or the principal corporate trust office of
any successor Co-Owner Trustee or Trust Eligible Lender Trustee (the address of
which the successor Co-Owner Trustee or Trust Eligible Lender Trustee will
notify the Depositor).

"Counterparty" shall mean any counterparty under a Derivative Product.


                                       4

<PAGE>

"Counterparty Derivative Payment" shall mean any payment to be made to, or for
the benefit of, the Issuer under a Derivative Product.

"Custodian" shall mean the Servicer or a Subservicer in its capacity as
custodian of the Borrower Notes or any permitted successor Custodian.

"Date of Issuance" when used with respect to any Series of Notes, shall have the
meaning given to such term in the Supplemental Indenture authorizing the
issuance of such Notes.

"Default" shall mean any occurrence that is, or with notice or the lapse of time
or both would become, an Event of Default.

"Delivery" when used with respect to Trust Account Property shall mean:

          (a)  with respect to bankers' acceptances, commercial paper,
     negotiable certificates of deposit and other obligations that constitute
     instruments and are susceptible of physical delivery ("Physical Property"):

               (i) transfer of possession thereof to the Indenture Trustee,
     endorsed to, or registered in the name of, the Indenture Trustee or its
     nominee or endorsed in blank;

          (b)  with respect to a certificated security:

               (i)  delivery thereof in bearer form to the Indenture Trustee; or

               (ii) delivery thereof in registered form to the Indenture
     Trustee; and

                    (A) the certificate is endorsed to the Indenture Trustee or
               in blank by effective endorsement; or

                    (B) the certificate is registered in the name of the
               Indenture Trustee, upon original issue or registration of
               transfer by the Issuer;

          (c)  with respect to an uncertificated security:

               (i)  the delivery of the uncertificated security to the Indenture
     Trustee; or

               (ii) the Issuer has agreed that it will comply with instructions
     originated by the Indenture Trustee without further consent by the
     registered owner;

          (d) with respect to any security issued by the U.S. Treasury, the
     Federal Home Loan Mortgage Corporation or by the Federal National Mortgage
     Association that is a book-entry security held through the Federal Reserve
     System pursuant to federal book-entry regulations:


                                       5

<PAGE>

               (i)  a Federal Reser.ve Bank by book entry credits the book-entry
     security to the securities account (as defined in 31 CFR Part 357) of a
     participant (as defined in 31 CFR Part 357) which is also a securities
     intermediary; and

               (ii) the participant indicates by book entry that the book-entry
     security has been credited to the Indenture Trustee's securities account;

          (e)  with respect to a security entitlement:

               (i)  the Indenture Trustee becomes the entitlement holder; or

               (ii) the securities intermediary has agreed that it will comply
     with entitlement orders originated by the Indenture Trustee;

          (f)  without further consent by the entitlement holder; for the
     purpose of clauses (b) and (c) hereof "delivery" shall mean:

               (i)  with respect to a certificated security:

                    (A) the Indenture Trustee acquires possession thereof;

                    (B) another person (other than a securities intermediary)
               either acquires possession thereof on behalf of the Indenture
               Trustee or, having previously acquired possession thereof,
               acknowledges that it holds for the Indenture Trustee; or

                    (C) a securities intermediary acting on behalf of the
               Indenture Trustee acquires possession of thereof, only if the
               certificate is in registered form and has been specially endorsed
               to the Indenture Trustee by an effective endorsement;

               (ii) with respect to an uncertificated security:

                    (A) the Issuer registers the Indenture Trustee as the Note
               Owner, upon original issue or registration of transfer; or

                    (B) another person (other than a securities intermediary)
               either becomes the Note Owner thereof on behalf of the Indenture
               Trustee or, having previously become the Note Owner, acknowledges
               that it holds for the Indenture Trustee;

          (g)  for purposes of this definition, except as otherwise indicated,
     the following terms shall have the meaning assigned to each such term in
     the UCC:

               (i)  "certificated security"

               (ii) "effective endorsement"


                                       6

<PAGE>

               (iii)  "entitlement holder"

               (iv)   "instrument"

               (v)    "securities account"

               (vi)   "securities entitlement"

               (vii)  "securities intermediary"

               (viii) "uncertificated security"

"Department" shall mean the United States Department of Education, an agency of
the federal government.

"Depositor" shall mean Education Funding Capital I, LLC.

"Depositor Eligible Lender Trust Agreement" shall mean the Eligible Lender Trust
Agreement dated as of May 1, 2002 between the Depositor and the Depositor
Eligible Lender Trustee.

"Depositor Eligible Lender Trustee" shall mean Fifth Third Bank, a banking
corporation organized under the laws of the State of Ohio, not in its individual
capacity but solely Depositor Eligible Lender Trustee under the Depositor
Eligible Lender Trust Agreement.

"Depositor Transfer and Sale Agreement" shall mean the Transfer and Sale
Agreement dated as of May 1, 2002 among the Depositor, the Depositor Eligible
Lender Trustee, the Issuer and the Trust Eligible Lender Trustee.

"Derivative Payment Date" shall mean, with respect to a Derivative Product, any
date specified in such Derivative Product on which both or either of the Issuer
Derivative Payment and/or a Counterparty Derivative Payment is due and payable
under such Derivative Product.

"Derivative Product" shall mean a written contract or agreement between the
Issuer and a Counterparty that provides that the Issuer's obligations thereunder
will be conditioned on the absence of (i) a failure by the Counterparty to make
any payment required thereunder when due and payable, or (ii) a default
thereunder with respect to the financial status of the Counterparty, and:

     (a)  under which the Issuer is obligated to pay (whether on a net payment
          basis or otherwise) on one or more scheduled and specified Derivative
          Payment Dates, the Issuer Derivative Payments in exchange for the
          Counterparty's obligation to pay (whether on a net payment basis or
          otherwise), or to cause to be paid, to the Issuer, Counterparty
          Derivative Payments on one or more scheduled and specified Derivative
          Payment Dates in the amounts set forth in the Derivative Product;

     (b)  for which the Issuer's obligation to make Issuer Derivative Payments
          may be secured by a pledge of and lien on the Trust Estate on an equal
          and ratable basis


                                       7

<PAGE>

          with any class of the Issuer's Outstanding Notes and which Issuer
          Derivative Payments may be equal in priority with any priority
          classification of the Issuer's Outstanding Notes; and

     (c)  under which Counterparty Derivative Payments are to be made directly
          to the Indenture Trustee for deposit into the Revenue Fund.

"Derivative Value" shall mean the value of the Derivative Product, if any, to
the Counterparty, provided that such value is defined and calculated in
substantially the same manner as amounts are defined and calculated pursuant to
the applicable provisions of an ISDA Master Agreement.

"Determination Date" shall mean with respect to (i) a principal payment date, 16
calendar days preceding such date and, (ii) an interest payment date, the third
Business Day preceding such date.

"Directing Notes" shall mean, so long as any Series of Senior Notes are
Outstanding, the Senior Notes, and thereafter, the Subordinate Notes.

"Eligible Deposit Account" shall mean either (a) a segregated account with a
depository institution organized under the laws of the United States of America
or any one of the states thereof or the District of Columbia (or any domestic
branch of a foreign bank) that has either a long-term unsecured debt rating of
A2 by Moody's and AA by Fitch or a short-term unsecured debt rating of Prime-1
by Moody's and F2 by Fitch, and whose deposits are insured by the Federal
Deposit Insurance Corporation; 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 thereof or the District
of Columbia (or any domestic branch of a foreign bank) having corporate trust
powers and acting as trustee for funds deposited in the account, so long as any
unsecured notes of the depository institution have an investment grade credit
rating from each Rating Agency.

"Eligible Investments" shall mean book-entry securities, negotiable instruments
or securities represented by instruments in bearer or registered form that
evidence:

          (a)  direct obligations of, and obligations fully guaranteed as to
     timely payment by, the United States of America;

          (b)  demand deposits, time deposits or certificates of deposit of any
     depository institution or trust company incorporated under the laws of the
     United States of America or any State (or any domestic branch of a foreign
     bank) and subject to supervision and examination by federal or state
     banking or depository institution authorities (including depository
     receipts issued by any such institution or trust company as custodian with
     respect to any obligation referred to in clause (a) above or portion of
     such obligation for the benefit of the holders of such depository
     receipts); provided, however, that at the time of the investment or
     contractual commitment to invest therein (which shall be deemed to be made
     again each time funds are reinvested following each Payment Date), the
     commercial paper or other short-term senior unsecured debt obligations
     (other than such obligations the rating of which is based on the credit of
     a Person other than such


                                       8

<PAGE>

     depository institution or trust company) thereof shall have a credit rating
     from each of the Rating Agencies in the highest short-term and long-term
     investment category granted thereby;

          (c)  commercial paper having, at the time of the investment or
     contractual commitment to invest therein, a rating from each of the Rating
     Agencies in the highest short-term and long-term investment category
     granted thereby;

          (d)  investments in money market funds having a rating from Moody's
     and each of the other Rating Agencies rating such fund, in the highest
     short-term investment category granted thereby (including funds for which
     the Indenture Trustee, the Servicer or the Trust Eligible Lender Trustee or
     any of their respective Affiliates is investment manager or advisor);

          (e)  bankers' acceptances issued by any depository institution or
     trust company referred to in clause (b) above;

          (f)  repurchase obligations with respect to any security that is a
     direct obligation of, or fully guaranteed by, the United States of America
     or any agency or instrumentality thereof the obligations of which are
     backed by the full faith and credit of the United States of America, in
     either case entered into with a depository institution or trust company
     (acting as principal) described in clause (b) above;

          (g)  any other investment permitted by each of the Rating Agencies as
     set forth in a written notice delivered to the Indenture Trustee.

No obligation will be considered to be rated in the highest investment category
if it has an "r" highlighter affixed to its rating. Eligible Investments shall
not include interest-only securities or securities purchased at a premium over
par.

"Eligible Lender" shall mean any "Eligible Lender" as defined in the Act that
has received an eligible lender designation from the Secretary with respect to
Student Loans made under the Act.

"Eligible Lender Trust Agreements" shall mean collectively the Seller Eligible
Lender Trust Agreement, the Depositor Eligible Lender Trust Agreement and the
Co-Owner Eligible Lender Trust Agreement.

"Event of Bankruptcy" shall mean (a) the Issuer shall have commenced a voluntary
case or other proceeding seeking liquidation, reorganization, or other relief
with respect to itself or its debts under any bankruptcy, insolvency, or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian, or other similar official of it or any
substantial part of its property, or shall have made a general assignment for
the benefit of creditors, or shall have declared a moratorium with respect to
its debts or shall have failed generally to pay its debts as they become due, or
shall have taken any action to authorize any of the foregoing; or (b) an
involuntary case or other proceeding shall have been commenced against the
Issuer seeking liquidation, reorganization, or other relief with respect to it
or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the


                                       9

<PAGE>

appointment of a trustee, receiver, liquidator, custodian, or other similar
official of it or any substantial part of its property, provided such action or
proceeding is not dismissed within 60 days.

"Events of Default" shall have the meaning set forth in Article V of the
Indenture.

"Federal Guarantor" shall mean a state or private non-profit guarantor that
guarantees the payment of principal of and interest on any of the Financed
Student Loans, which agency is reinsured by the Department under the Act for
between (x) 80% and 100% of the amount of default claims paid by such Federal
Guarantor for a given federal fiscal year for loans disbursed prior to October
1, 1993, for 78% to 98% of default claims paid for loans disbursed on or after
October 1, 1993 but prior to October 1, 1998 any (y) 75% to 95% of the amount of
default claims paid to by such Federal Guarantor for a given federal fiscal year
for loans disbursed on or after October 1, 1998 and for 100% of death,
disability, bankruptcy, closed school and false certification claims paid.

"FFEL Program" shall mean the Federal Family Education Loan Program established
by the Act pursuant to which loans are made to borrowers pursuant to certain
guidelines, and the repayment of such loans is guaranteed by a Guaranty Agency,
and any predecessor or successor program.

"FFELP Loan" shall mean a Student Loan made under the FFEL Program.

"Financed" or "Financing," when used with respect to Student Loans, shall mean
or refer to Student Loans (a) acquired by the Issuer with balances in the
Acquisition Fund or otherwise deposited in or accounted for in the Acquisition
Fund or otherwise constituting a part of the Trust Estate and (b) Student Loans
substituted or exchanged for Financed Student Loans, but does not include
Student Loans released from the lien of the Indenture and sold or transferred,
to the extent permitted by the Indenture.

"Financed Student Loans" shall mean (1) Student Loans that, as of any date of
determination, have been conveyed to the Issuer; and (2) any Student Loans that
the principal balance of which is increased by the principal balance of any
related Add-on Consolidation Loan; provided, however, that each Financed Student
Loan shall be a FFELP Loan unless the Issuer has obtained a Rating Confirmation
regarding the acquisition of non-FFELP Loans.

"Fiscal Year" shall mean the fiscal year of the Issuer as established from time
to time.

"Fitch" shall mean Fitch Ratings or any successor thereto.

"Funds" shall mean the funds established pursuant to Section 4.01(a) of the
Indenture.

"Guarantee" or "Guaranteed" shall mean, with respect to an Student Loan, the
insurance or guarantee by the Guaranty Agency pursuant to such Guaranty Agency's
Guarantee Agreement of the maximum percentage of the principal of and accrued
interest on such Student Loan allowed by the terms of the Act with respect to
such Student Loan at the time it was originated and the coverage of such Student
Loan by the federal reimbursement contracts, providing, among other things, for
reimbursement to the Guaranty Agency for payments made by it on defaulted
Student


                                       10

<PAGE>

Loans insured or guaranteed by the Guaranty Agency of at least the minimum
reimbursement allowed by the Act with respect to a particular Student Loan.

"Guaranty Agency" shall mean any entity authorized to guarantee student loans
under the Act and with which the Indenture Trustee maintains a Guarantee
Agreement.

"Guarantee Agreements" shall mean a guaranty or lender agreement between the
Indenture Trustee and any Guaranty Agency, and any amendments thereto.

"Guarantee Payment" shall mean any payment made by a Federal Guarantor pursuant
to a Guarantee Agreement in respect of a Student Loan.

"Highest Priority Obligations" shall mean, (a) at any time when Senior
Obligations are Outstanding, the Senior Obligations, and (b) at any time when no
Senior Obligations are Outstanding, the Subordinate Obligations.

"Indenture" shall mean the Indenture of Trust dated as of May 1, 2002 among the
Issuer, the Trust Eligible Lender Trustee and the Indenture Trustee, as amended
and supplemented from time to time.

"Indenture Trustee" shall mean Fifth Third Bank, a banking corporation organized
under the laws of the State of Ohio, not in its individual capacity but solely
as Indenture Trustee under the Indenture.

"Independent" shall mean, 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 Seller 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 Seller or any Affiliate of
any of the foregoing Persons and (c) is not connected with the Issuer, any such
other obligor, the Seller or any Affiliate of any of the foregoing Persons as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.

"Initial Purchaser" shall mean, with respect to a Series of Notes, the initial
purchaser of such Notes, which initial purchaser shall be identified in the
Supplemental Indenture authorizing the issuance of such Notes.

"Insurance" or "Insured" or "Insuring" shall mean, with respect to a Student
Loan, the insuring by the Secretary under the Act (as evidenced by a Certificate
of Insurance or other document or certification issued under the provisions of
the Act) of 100% of the principal of and accrued interest on such Student Loan.

"Interest Benefit Payment" shall mean an interest payment on Student Loans
received pursuant to the Act and an agreement with the federal government, or
any similar payments.

"Interest Fund" shall mean the Fund bearing that name established pursuant to
Section 4.01(a) of the Indenture, including any Accounts and subaccounts created
therein.


                                       11

<PAGE>

"Interest Subsidy Payments" shall mean payments, designated as such, consisting
of interest subsidies by the Department in respect of Financed Student Loans
that were originated under the Act to the Trust Eligible Lender Trustee on
behalf of the Trust in accordance with the Act.

"ISDA Master Agreement" shall mean the ISDA Interest Rate and Currency Exchange
Agreement, copyright 1992, as amended from time to time, including any schedule
or confirmation relating thereto, and as in effect with respect to any
Derivative Product.

"Issuer" shall mean Education Funding Capital Trust-I, until a successor
replaces it and, thereafter, means the successor and, for purposes of any
provision contained in the Indenture and required by the TIA, each other obligor
on the Notes.

"Issuer Derivative Payment" shall mean a payment required to be made by or on
behalf of the Issuer due to a Counterparty pursuant to a Derivative Product.

"Issuer Order" and "Issuer Request" shall mean 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.

"Market Agent Agreement" when used with respect to any Series of Notes, shall
have the meaning given to such term in the Supplemental Indenture authorizing
the issuance of such Notes.

"Maturity" when used with respect to any Note, shall mean the date on which the
principal thereof becomes due and payable as therein or herein provided, whether
at its Stated Maturity, by earlier redemption, by declaration of acceleration,
or otherwise.

"Moody's" shall mean Moody's Investors Service, Inc. and its successors and
assigns.

"Note Counsel" shall mean counsel to the Issuer.

"Note Purchase Agreement" shall mean, with respect to a Series of Notes, the
agreement regarding the purchase of such Notes between the Issuer and the
Initial Purchaser identified in the Supplemental Indenture authorizing the
issuance of such Notes.

"Note Owner" shall mean, with respect to a book-entry Note, the Person who is
the owner of such book-entry Note, as reflected on the books of the Clearing
Agency, or on the books of a Person maintaining an account with such Clearing
Agency (directly as a Clearing Agency Participant or as an indirect participant,
in each case in accordance with the rules of such Clearing Agency).

"Noteholder" shall mean, with respect to a Note, the Person in whose name a Note
is registered in the Note registration books maintained by the Indenture Trustee
and, with respect to a Derivative Product, the Counterparty thereunder.

"Noteholder Approval" shall have the meaning given such term in Section 5.01 of
the Indenture.

"Notes" shall mean, collectively, the Senior Notes and the Subordinate Notes.


                                       12

<PAGE>

"Obligations" shall mean Senior Obligations and Subordinate Obligations.

"Operating Fund" shall mean the Fund bearing that name established pursuant to
Section 4.01(b) of the Indenture, including any Accounts and Subaccounts created
therein.

"Opinion of Counsel" shall mean (i) with respect to the Issuer, one or more
written opinions of counsel who may, except as otherwise expressly provided in
the Indenture, be employees of or counsel to the Issuer and who shall be
satisfactory to the Indenture Trustee, and which opinion or opinions shall be
addressed to the Indenture Trustee as Indenture Trustee and shall be in form and
substance satisfactory to the Indenture Trustee and (ii) with respect to the
Seller, the Administrator, the Servicer or a Federal Guarantor, one or more
written opinions of counsel who may be an employee of or counsel to the Seller,
the Administrator, the Servicer or such Federal Guarantor, which counsel shall
be acceptable to the Indenture Trustee, the Trust Eligible Lender Trustee or the
Rating Agencies, as applicable.

"Outstanding Amount" or "Outstanding" shall mean the aggregate principal amount
of all Notes outstanding at the date of determination.

"Owner" means the Depositor and each of its successors in interest as
beneficiaries of the Trust pursuant to Article III of the Trust Agreement.

"Ownership Percentage" with respect to an Owner means the proportion (expressed
as a percentage) of the beneficial interest in the Trust held by such Owner.

"Owner Trustee" shall mean the Wilmington Trust Company, not in its individual
capacity, but solely as trustee of the Trust under the Trust Agreement.

"Parity Percentage" means the ratio of the Value of the Trust Estate, less
accrued interest and fees with respect to all Notes, to the principal amount of
all Notes then Outstanding.

"Payment Date" shall mean, for any Note, any interest payment date, its Stated
Maturity or the date of any other regularly scheduled principal payment with
respect thereto.

"Person" shall mean any individual, corporation, estate, partnership, joint
venture, limited liability company, limited liability partnership, association,
joint stock company, trust (including any beneficiary thereof), unincorporated
organization or government or any agency or political subdivision thereof.

"Physical Property" shall have the meaning given such term in the definition of
"Delivery".

"Principal Fund" shall mean the Fund bearing that name established pursuant to
Section 4.01(a) of the Indenture, including any Accounts and subaccounts created
therein.

"Program" shall mean the Issuer's program for the purchase of Student Loans, as
the same may be modified from time to time.


                                       13

<PAGE>

"Program Expenses" shall mean (a) the fees and expenses of the Indenture
Trustee, the Owner Trustee and the Co-Owner Trustee; (b) the fees and expenses
of any auction agent, any market agent, any calculation agent and any
broker-dealer then acting under a Supplemental Indenture with respect to auction
rate Notes; (c) the fees and expenses of any remarketing agent then acting under
a Supplemental Indenture with respect to variable rate Notes; (d) the fees and
expenses due to any credit provider of any Notes for which a credit facility or
liquidity facility is in place; (e) the fees of the Administrator, the Servicer
and/or Custodian under the Administration Agreement and any servicing agreement
or custodian agreement; (f) the fees and expenses of the Issuer incurred in
connection with the preparation of legal opinions and other authorized reports
or statements attributable to the Notes and the Financed Student Loans; (g)
transfer fees, purchase premiums, loan origination fees and Consolidation Loan
rebate fees on Financed Student Loans; (h) fees and expenses associated with the
delivery of a substitute credit facility or liquidity facility under a
Supplemental Indenture; (i) fees and expenses associated with (but not payments
under) Derivative Products; (j) the costs of remarketing any variable rate Notes
and (k) expenses incurred for the Issuer's maintenance and operation of its
Program as a direct consequence of the Indenture, the Notes or the Financed
Student Loans; including, but not limited to, taxes, the reasonable fees and
expenses of attorneys, agents, financial advisors, consultants, accountants and
other professionals, attributable to such maintenance and operation, marketing
expenses for the Program and a prorated portion of the rent, personnel
compensation, office supplies and equipment, travel expenses and other lawful
payments made to the Owner Trustee and Co-Owner Trustee.

"Rating" shall mean one of the rating categories of Fitch and Moody's or any
other Rating Agency, provided Fitch and Moody's or any other Rating Agency, as
the case may be, is currently rating the Notes.

"Rating Agency" shall mean Moody's and Fitch. 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 Seller, notice of which designation shall be given to the Indenture
Trustee, the Trust Eligible Lender Trustee and the Servicer.

"Rating Agency Condition" shall mean, with respect to any action, that each
Rating Agency shall have been given prior notice thereof and that each of the
Rating Agencies shall have issued a Rating Confirmation.

"Rating Confirmation" shall mean, as of any date, a letter from each Rating
Agency then providing a Rating for any of the Notes, confirming that the action
proposed to be taken by the Issuer will not, in and of itself, result in a
downgrade of any of the Ratings then applicable to the Notes, or cause any
Rating Agency to suspend or withdraw the Ratings then applicable to the Notes.

"Recoveries of Principal" shall mean all amounts received by the Indenture
Trustee from or on account of any Financed Student Loan as a recovery of the
principal amount thereof, including scheduled, delinquent and advance payments,
payouts or prepayments, proceeds from insurance or from the sale, assignment,
transfer, reallocation or other disposition of a Financed Student


                                       14

<PAGE>

Loan and any payments representing such principal from the guarantee or
insurance of any Financed Student Loan.

"Regulations" shall mean the Regulations promulgated from time to time by the
Secretary or any Guaranty Agency guaranteeing Financed Student Loans.

"Required Parity Percentage" with respect to any Series of Notes shall have the
meaning given to such term in the Supplemental Indenture pursuant to which such
Series of Notes was issued.

"Required Senior Parity Percentage" with respect to any Series of Notes shall
have the meaning given to such term in the Supplemental Indenture pursuant to
which such Series of Notes was issued.

"Reserve Fund" shall mean the Fund bearing that name established pursuant to
Section 4.01(a) of the Indenture, including any Accounts and Subaccounts created
therein.

"Reserve Fund Requirement" shall mean an amount, if any, required to be on
deposit in the Reserve Fund with respect to any Notes pursuant to the
Supplemental Indenture authorizing the issuance of such Notes.

"Responsible Officer" with respect to the Indenture Trustee, any officer
assigned to the Corporate Trust Office of the Indenture Trustee, including any
managing director, principal, vice president, assistant vice president,
assistant treasurer, assistant secretary, trust officer or any other officer of
the Indenture Trustee customarily performing functions similar to those
performed by any of the above designated officers and having direct
responsibility for the administration of the Indenture, 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.

"Revenue" or "Revenues" shall mean all Recoveries of Principal, payments,
proceeds, charges and other income received by the Indenture Trustee or the
Issuer from or on account of any Financed Student Loan (including scheduled,
delinquent and advance payments of and any insurance proceeds with respect to,
interest, including Interest Benefit Payments, on any Financed Student Loan and
any Special Allowance Payment received by the Issuer with respect to any
Financed Student Loan) and all interest earned or gain realized from the
investment of moneys in any Fund or Account and all payments received by the
Issuer pursuant to a Derivative Product.

"Revenue Fund" shall mean the Fund bearing that name established pursuant to
Section 4.01(a) of the Indenture, including any Accounts and subaccounts created
therein.

"Revolving Period" shall mean a period determined by the Issuer subject to the
Rating Agency Condition.

"Schedule of Financed Student Loans" shall means the schedule of Student Loans
attached as Schedule A to each Student Loan Acquisition Certificate.


                                       15

<PAGE>

"Secretary" shall mean the Secretary of the Department, or any successor to the
functions thereof under the Act.

"Securities Act" shall mean the federal Securities Act of 1933, as amended.

"Securities Depository" or "Depository" shall mean The Depository Trust Company
and its successors and assigns or if, (a) the then Securities Depository resigns
from its functions as depository of the Notes or (b) the Issuer discontinues use
of the Securities Depository, any other securities depository that agrees to
follow the procedures required to be followed by a securities depository in
connection with the Notes and that is selected by the Issuer with the consent of
the Indenture Trustee.

"Securities Exchange Act" shall mean the federal Securities Exchange Act of
1934, as amended.

"Seller" shall mean Education Lending Group, Inc., in its capacity as seller of
the Financed Student Loans under the Seller Transfer and Sale Agreement.

"Seller Eligible Lender Trust Agreement" shall mean the Eligible Lender Trust
Agreement dated as of May 1, 2002 between the Seller and the Seller Eligible
Lender Trustee.

"Seller Eligible Lender Trustee" shall mean Fifth Third Bank, a banking
corporation organized under the laws of the State of Ohio, not in its individual
capacity but solely Seller Eligible Lender Trustee under the Seller Eligible
Lender Trust Agreement.

"Seller Transfer and Sale Agreement" shall mean Transfer and Sale Agreement
dated as of May 1, 2002 among the Seller, the Seller Eligible Lender Trustee,
the Depositor and the Depositor Eligible Lender Trustee.

"Senior Notes" shall mean all Notes secured on a priority senior to the
Subordinate Obligations and other borrowings of the Issuer, if any, secured
hereby.

"Senior Obligations" shall mean Senior Notes and any Derivative Product, the
priority of payment of which is equal with that of Senior Notes.

"Senior Parity Percentage" means the ratio of the Value of the Trust Estate,
less accrued interest and fees with respect to all Senior Notes, to the
principal amount of all Senior Notes then Outstanding.

"Series" shall mean a series of Notes to which all the same terms and conditions
apply and which can be identified by its own alpha-numeric designation (e.g.
"A-1") and which is so designated in the Supplement Indenture authorizing the
issuance of such Notes.

"Servicer" shall mean Grad Partners, Inc., in its capacity as servicer of the
Financed Student Loans, or any permitted successor Servicer, under the Servicer
Agreement.

"Servicer Default" shall mean an event specified as such in the applicable
Servicing Agreement.


                                       16

<PAGE>

"Servicer Report" shall contain the information specified in Exhibit A-1 to the
Servicing Agreement.

"Servicing Agreement" shall mean the servicing agreement with the Servicer
relating to Financed Student Loans, as amended from time to time.

"Servicing Fee" has the meaning specified in the applicable Servicing Agreement.

"Special Allowance Payments" shall mean payments, designated as such, consisting
of effective interest subsidies by the Department to the Trust Eligible Lender
Trustee on behalf of the Trust in accordance with the Act in respect of the
Financed Student Loans that were originated under the Act.

"Stated Maturity" shall mean the date specified in the Notes as the fixed date
on which principal of such Notes is due and payable.

"Student Loan" shall mean an agreement to repay a disbursement of money to or on
behalf of an eligible student, evidenced by a Borrower Note and, with respect to
Guaranteed Student Loans, guaranteed in accordance with the policies and
procedures of a Federal Guarantor.

"Student Loan Acquisition Certificate" shall mean a certificate signed by an
Authorized Officer of the Issuer in substantially the form attached as Exhibit A
to the Indenture.

"Subaccount" shall mean any of the subaccounts that may be created and
established within any Account or Fund by the Indenture.

"Subordinate Notes" shall mean any Notes secured on a priority subordinate to
the Senior Obligations but on a priority senior to any other borrowings of the
Issuer, if any, secured hereby.

"Subordinate Obligations" shall mean Subordinate Notes and any Derivative
Product, the priority of payment of which is equal with that of Subordinate
Notes.

"Subservicer" shall mean Great Lakes Higher Education Servicing Corporation, in
its capacity as Subservicer of the Financed Student Loans, and/or any other
permitted Subservicer, under the Servicer Agreement.

"Subservicing Agreement" shall mean any agreement entered into between the
Servicer and a Subservicer containing the terms under which the Subservicer
shall service, and otherwise act with respect to, all or certain of the Financed
Student Loans.

"Supplemental Indenture" shall mean an agreement supplemental to the Indenture,
executed pursuant to Article VII of the Indenture.

"Transfer and Sale Agreements" shall mean collectively the Seller Transfer and
Sale Agreement and the Depositor Transfer and Sale Agreement.


                                       17

<PAGE>

"Treasury Regulations" shall mean 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" shall mean Education Funding Capital Trust-I, formed pursuant to the
Trust Agreement.

"Trust Accounts" shall have the meaning set forth in Section 2(c) of the
Administration Agreement.

"Trust Account Property" shall mean 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 Fund and the Revenue Fund and
all proceeds of the foregoing.

"Trust Agreement" shall mean the Trust Agreement dated as of May 9, 2002 among
the Depositor, the Owner Trustee and the Co-Owner Trustee, as amended and
restated in its entirety by the Amended and Restated Trust Agreement dated as of
May 9, 2002 among the Depositor, the Owner Trustee and the Co-Owner Trustee, and
acknowledged and agreed to by the Trust Eligible Lender Trustee, as the same may
be further amended from time to time.

"Trust Certificate" means a certificate evidencing the Ownership Percentage of
an Owner in substantially the form as Exhibit A to the Trust Agreement.

"Trust Eligible Lender Trustee" shall mean Fifth Third Bank, a banking
corporation organized under the laws of the State of Ohio, not in its individual
capacity but solely as Trust Eligible Lender Trustee under the Co-Owner Eligible
Lender Trust Agreement.

"Trust Estate" shall mean all right, title and interest of the Trust (or the
Co-Owner Trustee or Trust Eligible Lender Trustee on behalf of the Trust) in and
to the property and rights assigned to the Trust pursuant to Article I of the
Depositor Transfer and Sale 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 Trust pursuant to the Depositor Transfer and Sale
Agreement, the Servicing Agreement and the Administration Agreement.

"Trust Indenture Act" or "TIA" shall mean the Trust Indenture Act of 1939 as in
force on the date hereof, unless otherwise specifically provided.

"UCC" shall mean, unless the context otherwise requires, the Uniform Commercial
Code, as in effect in the relevant jurisdiction, as amended from time to time.

"Value" on any calculation date when required under the Indenture shall mean the
value of the Trust Estate calculated by the Issuer as to (a) below and by the
Indenture Trustee as to (b) through (e), inclusive, below, as follows:


                                       18

<PAGE>

     (a)  with respect to any Student Loan, the unpaid principal amount thereof,
          accrued but unpaid interest, Interest Benefit Payments and Special
          Allowance Payments, if applicable, less the unguaranteed portion of
          Student Loans in claims status;

     (b)  with respect to any funds of the Issuer held under the Indenture and
          on deposit in any commercial bank or as to any banker's acceptance or
          repurchase agreement or investment contract, the amount thereof plus
          accrued but unpaid interest;

     (c)  with respect to any Eligible Investments of an investment company, the
          bid price of the shares as reported by the investment company plus
          accrued but unpaid interest;

     (d)  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; and

     (e)  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:
          (i) the lower of the bid prices at such time of determination for such
          investments by any two nationally recognized government securities
          dealers (selected by the Issuer in its absolute discretion) at the
          time making a market in such investments or (ii) the bid price
          published by a nationally recognized pricing service.


                                       19

<PAGE>

================================================================================

                                2002-1 Series A&B
                         Supplemental Indenture of Trust

                                 by and between

                        Education Funding Capital Trust-I

                                       and

                                Fifth Third Bank,
                              as Indenture Trustee

                                       and

                                Fifth Third Bank,
                        as Trust Eligible Lender Trustee

                           Authorizing the Issuance of

                                  $525,000,000
                        Education Funding Capital Trust-I
                    Auction Rate Education Loan Backed Notes
                                2002-1 Series A&B

                             Dated as of May 1, 2002

================================================================================

<PAGE>

                                Table of Contents

                                    Article I

                         Definitions and Use of Phrases

                                   Article II

                         2002-1 Series A&B Note Details,
                        Form of 2002-1 Series A&B Notes,
                      Redemption of 2002-1 Series A&B Notes
                 And Use of Proceeds of 2002-1 Series A&B Notes

<TABLE>
<S>                                                                                   <C>
Section 2.01   2002-1 Series A&B Note Details .....................................   4
Section 2.02   Redemption of the 2002-1 Series A&B Notes ..........................   6
Section 2.03   Delivery of 2002-1 Series A&B Notes ................................   8
Section 2.04   Trustee's Authentication Certificate ...............................   8
Section 2.05   Deposit of 2002-1 Series A&B Note Proceeds .........................   8
Section 2.06   Excess Reserve Fund Amounts ........................................   8
Section 2.07   Forms of 2002-1 Series A&B Notes ...................................   9
Section 2.08   Regarding Acquisition Account ......................................   9

                                   Article III

                               General Provisions

Section 3.01   Date of Execution ..................................................   9
Section 3.02   Laws Governing .....................................................   9
Section 3.03   Severability .......................................................   9
Section 3.04   Exhibits and Appendices ............................................   9

                                   Article IV

                           Applicability of Indenture

Appendix A     Certain Terms and Provisions of the Auction Rate Notes
Exhibit A-1    Form of Series A Notes
Exhibit A-2    Form of Series B Notes
Exhibit B      2002-1 Series A&B Closing Cash Flow Projections
Exhibit C      Notice of Payment Default
Exhibit D      Notice of Cure of Payment Default
Exhibit E      Notice of Proposed Change In Length of One or More  Auction Periods
Exhibit F      Notice Establishing Change in Length of One or More Auction Periods
Exhibit G      Notice of Change In Auction Date
</TABLE>


                                       i

<PAGE>

                2002-1 Series A&B Supplemental Indenture of Trust

     This 2002-1 Series A&B Supplemental Indenture of Trust (this "Supplemental
Indenture") dated as of May 1, 2002 is by and between Education Funding Capital
Trust-I, a Delaware business trust (the "Issuer"), Fifth Third Bank, a banking
corporation organized under the laws of the State of Ohio, as indenture trustee
(the "Indenture Trustee"), and Fifth Third Bank, a banking corporation organized
under the laws of the State of Ohio, as Trust Eligible Lender Trustee (the
"Trust Eligible Lender Trustee"). All capitalized terms used in these preambles,
recitals and granting clauses shall have the same meanings assigned thereto in
Article I hereof.

                              W I T N E S S E T H:

     Whereas, the Issuer has previously entered into an Indenture of Trust dated
as of May 1, 2002 (the "Indenture") among the Issuer, the Indenture Trustee and
the Trust Eligible Lender Trustee;

     Whereas, the Issuer desires to enter into this Supplemental Indenture in
order to issue Notes pursuant to the terms of the Indenture, including Section
1.08 thereof;

     Whereas, the Issuer represents that it is duly created as a business trust
under the laws of the State of Delaware and that by proper action it has duly
authorized the issuance of $525,000,000 of its Auction Rate Education Loan
Backed Notes, 2002-1 Series A&B, consisting of seven classes designated as
Series 2002 A (the "Series A Notes") and one class designated as Series 2002 B
(the "Series B Notes" and together with the Series A Notes, the "2002-1 Series
A&B Notes"), and it has by proper action authorized the execution and delivery
of this Supplemental Indenture;

     Whereas, the 2002-1 Series A&B Notes constitute Notes as defined in the
Indenture; and

     Whereas, the Indenture Trustee has agreed to accept the trusts herein
created upon the terms herein set forth;

     Now, Therefore, it is mutually covenanted and agreed as follows:

                                    Article I

                         Definitions and Use of Phrases

     All words and phrases defined in Appendix A of the Indenture shall have the
same meaning in this Supplemental Indenture, except as otherwise appears in this
Article. In addition, the following terms have the following meanings in this
Supplemental Indenture unless the context clearly requires otherwise:

<PAGE>

     "2002-1 Series A&B Notes" shall mean the Education Funding Capital Trust-I,
Auction Rate Education Loan Backed Notes, 2002-1 Series A&B issued pursuant to
this Supplemental Indenture in the aggregate principal amount of $525,000,000.

     "Authorized Denominations" shall mean $50,000 and any integral multiple
thereof for the 2002-1 Series A&B Notes.

     "Date of Issuance" shall mean, with respect to the 2002-1 Series A&B Notes,
May 23, 2002.

     "Initial Purchasers" shall mean William R. Hough & Co. and PNC Capital
Markets, Inc.

     "Rating Agency" shall mean, collectively, Fitch Ratings and Moody's
Investors Service, Inc.

     "Record Date" shall mean, with respect to each Payment Date, the Business
Day immediately proceeding such Payment Date.

     "Required Parity Percentage" shall mean 100.5% so long as any 2002-1 Series
A&B Notes are Outstanding; provided, however, that the Required Parity
Percentage may be reduced upon receipt of a Rating Confirmation.

     "Required Senior Parity Percentage" shall mean 105% so long as any 2002-1
Series A&B Notes are Outstanding; provided, however, that the Required Senior
Parity Percentage may be reduced upon receipt of a Rating Confirmation.

     "Reserve Fund Requirement" shall mean 0.5% of the 2002-1 Series A&B Notes
Outstanding; provided, however, that so long as any Series A Notes or Series B
Notes remain Outstanding there shall be at least $500,000 on deposit in the
Reserve Fund. Further, such percentages and amounts may be changed upon
satisfaction of the Rating Agency Condition.

     "Series A Notes" shall mean, collectively, the Series A-1 Notes, the Series
A-2 Notes, the Series A-3 Notes, the Series A-4 Notes, the Series A-5 Notes, the
Series A-6 Notes, and the Series A-7 Notes, which Series A Notes are designated
as "Senior Notes" for all purposes of the Indenture.

     "Series A-1 Notes" shall mean the $75,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-1.

     "Series A-2 Notes" shall mean the $75,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-2.

     "Series A-3 Notes" shall mean the $75,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-3.


                                       2

<PAGE>

     "Series A-4 Notes" shall mean the $67,800,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-4.

     "Series A-5 Notes" shall mean the $66,500,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-5.

     "Series A-6 Notes" shall mean the $66,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-6.

     "Series A-7 Notes" shall mean the $66,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-7.

     "Series B Notes" shall mean the $33,700,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 B-1, which Series
B Notes are designated as "Subordinate Notes" for all purposes of the Indenture.

     "Servicing Agreement" shall mean, collectively, (i) the Servicing Agreement
dated as of May 1, 2002, as supplemented and amended from time to time, between
the Issuer and the Servicer, and (ii) the Subservicing Agreement.

     "Subservicer" shall mean Great Lakes Higher Education Servicing
Corporation, its successors and assigns and, subject to the Rating Agency
Condition, any other subservicer designated pursuant to the Servicing Agreement.

     "Subservicing Agreement" shall mean the Subservicing Agreement dated as of
May 1, 2002, as supplemented and amended from time to time, between the Servicer
and the Subservicer and, subject to the Rating Agency Condition, any other
subservicer designated pursuant to the Servicing Agreement.

     Words importing the masculine gender include the feminine gender. Words
importing persons include firms, associations and corporations. Words importing
the singular number include the plural number and vice versa. Additional terms
are defined in the body of this Supplemental Indenture and the Appendices
hereto.

     In the event that any term or provision contained herein with respect to
the 2002-1 Series A&B Notes shall conflict with or be inconsistent with any term
or provision contained in the Indenture, the terms and provisions of this
Supplemental Indenture shall govern.


                                       3

<PAGE>

                                   Article II

                         2002-1 Series A&B Note Details,
                        Form Of 2002-1 Series A&B Notes,
                      Redemption of 2002-1 Series A&B Notes
                 and Use of Proceeds of 2002-1 Series A&B Notes

     Section 2.01 2002-1 Series A&B Note Details. The aggregate principal amount
of the 2002-1 Series A&B Notes that may be initially authenticated and delivered
under this Supplemental Indenture is limited to, and shall be individually
issued in eight (8) separate series consisting of $75,000,000 of Series A-1
Notes, $75,000,000 of Series A-2 Notes, $75,000,000 of Series A-3 Notes,
$67,800,000 of Series A-4 Notes, $66,5000,000 of Series A-5 Notes, $66,000,000
of Series A-6 Notes, $66,000,000 of Series A-7 Notes, and $33,700,000 of Series
B Notes, except for 2002-1 Series A&B Notes authenticated and delivered upon
transfer of, or in exchange for, or in lieu of Notes pursuant to Section 1.03 of
the Indenture. The 2002-1 Series A&B Notes shall be issuable only as fully
registered notes in the Authorized Denominations. The Series A Notes shall be
designated "Series 2002 A-1", "Series 2002 A-2", "Series 2002 A-3", "Series 2002
A-4", "Series 2002 A-5", "Series 2002 A-6", and "Series 2002 A-7" and the Notes
of each Series shall be numbered separately from 1 upwards. The Series B Notes
shall be designated "Series 2002 B-1" and shall be numbered separately from 1
upwards.

     The 2002-1 Series A&B Notes (collectively, the "Auction Rate Notes") shall
be dated their Date of Issuance and shall bear interest from their Date of
Issuance, payable on each Payment Date (as defined in Appendix A to this
Supplemental Indenture), except that Auction Rate Notes that are issued upon
transfer, exchange or other replacement shall bear interest from the most recent
Payment Date to which interest has been paid, or if no interest has been paid,
from the date of the Auction Rate Notes. The 2002-1 Series A&B Notes shall
mature on June 1, 2042. Interest on the Auction Rate Notes shall be computed on
the basis of a 360-day year and actual days elapsed. The terms of and
definitions related to the Auction Rate Notes are found in Article I hereof and
Appendix A to this Supplemental Indenture. No premium payments shall be paid on
the 2002-1 Series A&B Notes issued under this Supplemental Indenture.

     The principal of the 2002-1 Series A&B Notes due at its Stated Maturity or
redemption in whole shall be payable at the Corporate Trust Office of the
Indenture Trustee, or such other location as directed by the Indenture Trustee,
or at the principal office of its successor in trust upon presentation and
surrender of the 2002-1 Series A&B Notes. Payment of interest and principal paid
subject to a redemption on any 2002-1 Series A&B Note shall be made to the
Noteholder thereof by check or draft mailed on the Payment Date by the Indenture
Trustee to the Noteholder at his address as it last appears on the registration
books kept by the Indenture Trustee at the close of business on the Record Date
for such Payment Date, but any such interest not so timely paid or duly provided
for shall cease to be payable to the Noteholder thereof at the close of business
on the Record Date and shall be payable to the Noteholder thereof at the close
of business on a special record date (a "Special Record Date") for the payment
of any such defaulted interest. Such Special Record Date shall be fixed by the
Indenture Trustee whenever moneys become available for payment of the defaulted
interest, and notice of such Special Record Date shall be given to the
Noteholders of the 2002-1 Series A&B Notes not less than ten (10) days prior
thereto by first-class


                                       4

<PAGE>

mail to each such Noteholder as shown on the Indenture Trustee's registration
books on the date selected by the Indenture Trustee, stating the date of the
Special Record Date and the date fixed for the payment of such defaulted
interest. Payment of interest to the Securities Depository or its nominee shall,
and at the written request addressed to the Indenture Trustee of any other
Noteholder owning at least $1,000,000 principal amount of the 2002-1 Series A&B
Notes, payments of interest shall, be paid by wire transfer within the United
States to the bank account number filed no later than the Record Date or Special
Record Date with the Indenture Trustee for such purpose. All payments on the
2002-1 Series A&B Notes shall be made in lawful money of the United States of
America.

     (a) Except as otherwise provided in this Section, the Series A-1 Notes,
Series A-2 Notes, Series A-3 Notes, Series A-4 Notes, Series A-5 Notes, Series
A-6 Notes, Series A-7 Notes and Series B Notes in the form of one global note
for each Series shall be registered in the name of the Securities Depository or
its nominee and ownership thereof shall be maintained in book-entry form by the
Securities Depository for the account of the Agent Members. Initially, each
Series A Note and Series B Note shall be registered in the name of CEDE & CO.,
as the nominee of The Depository Trust Company. Except as provided in subsection
(d) of this Section, the Series A Notes and Series B Notes may be transferred,
in whole but not in part, only to the Securities Depository or a nominee of the
Securities Depository or to a successor Securities Depository selected or
approved by the Issuer or to a nominee of such successor Securities Depository.
Each global note shall bear a legend substantially to the following effect:
"Except as otherwise provided in the Indenture, this global note may be
transferred, in whole but not in part, only to another nominee of the Securities
Depository (as defined in the Indenture) or to a successor Securities Depository
or to a nominee of a successor Securities Depository."

     (b) Except as otherwise provided herein, the Issuer and the Indenture
Trustee shall have no responsibility or obligation with respect to (i) the
accuracy of the records of the Securities Depository or any Agent Member with
respect to any beneficial ownership interest in the Series A Notes and Series B
Notes, (ii) the delivery to any Agent Member, beneficial owner of the Series A
Notes and Series B Notes or other Person, other than the Securities Depository,
of any notice with respect to the Series A Notes and Series B Notes or (iii) the
payment to any Agent Member, beneficial owner of the Series A Notes and Series B
Notes or other Person, other than the Securities Depository, of any amount with
respect to the principal of or interest on the Series A Notes and Series B
Notes. So long as the certificates for the Series A Notes and Series B Notes
issued under this Supplemental Indenture are not issued pursuant to subsection
(c) of this Section the Issuer and the Indenture Trustee may treat the
Securities Depository as, and deem the Securities Depository to be, the absolute
owner of the Series A Notes and Series B Notes for all purposes whatsoever,
including, without limitation, (A) the payment of principal of and interest on
such Series A Notes and Series B Notes, (B) giving notices of redemption and
other matters with respect to such Series A Notes and Series B Notes and (C)
registering transfers with respect to such Series A Notes and Series B Notes. In
connection with any notice or other communication to be provided to the
Noteholders pursuant to this Supplemental Indenture by the Issuer or the
Indenture Trustee with respect to any consent or other action to be taken by the
Noteholders, the Issuer or the Indenture Trustee, as the case may be, shall
establish a record date for such consent or other action and, if the Securities
Depository shall hold all of the Series A Notes and Series B Notes, give the
Securities Depository notice of such record date not less than 15 calendar days
in advance of such


                                       5

<PAGE>

record date to the extent possible. Such notice to the Securities Depository
shall be given only when the Securities Depository is the sole Noteholder.

     (c) If at any time the Securities Depository notifies the Issuer and the
Indenture Trustee that it is unwilling or unable to continue as Securities
Depository with respect to any or all of the Series A Notes and Series B Notes
or if at any time the Securities Depository shall no longer be registered or in
good standing under the Securities Exchange Act or other applicable statute or
regulation and a successor Securities Depository is not appointed by the Issuer
within 90 days after the Issuer receives notice or becomes aware of such
condition, as the case may be, subsections (a) and (b) of this Section shall no
longer be applicable and the Issuer shall execute and the Indenture Trustee
shall authenticate and deliver certificates representing the Series A Notes and
Series B Notes as provided below. In addition, the Issuer may determine at any
time that the Series A Notes and Series B Notes shall no longer be represented
by global certificates and that the provisions of subsections (a) and (b) of
this Section shall no longer apply to the Series A Notes and Series B Notes. In
such event, the Issuer shall execute and the Indenture Trustee shall
authenticate and deliver certificates representing the Series A Notes and Series
B Notes as provided below. Certificates for the Series A Notes and Series B
Notes issued in exchange for a global certificate pursuant to this subsection
shall be registered in such names and authorized denominations as the Securities
Depository, pursuant to instructions from the Agent Members or otherwise, shall
instruct in writing to the Issuer and the Indenture Trustee, and upon which
written instructions the Indenture Trustee may rely without investigation. The
Indenture Trustee shall promptly deliver such certificates representing the
Series A Notes and Series B Notes to the Persons in whose names such Notes are
so registered.

     Section 2.02 Redemption of the 2002-1 Series A&B Notes.

     (a) Mandatory Redemption. If on any Determination Date the Parity
Percentage is not equal to at least the Required Parity Percentage, the 2002-1
Series A&B Notes are subject to mandatory redemption, in whole or in part, on
any interest Payment Date from Revenues on deposit in the Principal Fund;
provided, however, that during any Revolving Period, upon Issuer Order, after
any transfer to the Operating Fund in respect of Program Expenses and after the
transfers required by Sections 4.03(b)(i) through (v) of the Indenture, moneys
remaining on deposit in the Revenue Fund shall be transferred to the Acquisition
Fund and used for the acquisition or origination of other Student Loans.

     The 2002-1 Series A&B Notes are also subject to mandatory redemption, in
whole or in part, on any interest Payment Date, from Revenues representing
Recoveries of Principal on deposits in the Principal Fund. Series B Notes shall
only be redeemed to the extent that after such payment the Senior Parity
Percentage shall not be less than the Required Senior Parity Percentage.

     (b) Optional Redemption of 2002-1 Series A&B Notes. The 2002-1 Series A&B
Notes are subject to redemption, in whole or in part, at the option of the
Issuer on any regularly scheduled interest Payment Date. Moneys in the Principal
Fund which were transferred to the Principal Fund pursuant to Section
4.03(b)(ix) of the Indenture may be used by the Issuer for optional redemption
of the Series 2002-1 Series A&B Notes. Carryover amounts and interest on the
carryover amounts will be paid prior to any optional redemption of 2002-1 Series
A&B Notes. To the extent funds are


                                       6

<PAGE>

available in the Interest Fund to pay carryover amounts and interest on
carryover amounts on any Payment Date, such funds will be allocated first to pay
carryover amounts and interest on carryover amounts on 2002-1 Series A&B Notes
subject to mandatory redemption on such Payment Date. Any carryover amount and
interest on the carryover amount not paid on the date a 2002-1 Series A&B Note
is redeemed pursuant to mandatory redemption will be cancelled and not paid on
that Note on any subsequent date.

     (c) Redemption Price. Any 2002-1 Series A&B Notes redeemed pursuant to
Section 2.02(a) or (b) hereof shall be redeemed at a price equal to the
principal balance of such Notes plus accrued interest to the date of redemption.

     (d) Limitation of Redemption of Series B Notes. The Series B Notes that are
otherwise subject to optional or mandatory redemption shall be redeemed only if,
as of the date of selection of Series B Notes for redemption and after giving
effect to such redemption, the Senior Parity Percentage will be equal to at
least the Required Senior Parity Percentage, and the Parity Percentage will be
equal to at least the Required Parity Percentage.

     (e) Redemption of Additional Series of Notes. The Issuer shall determine in
a Supplemental Indenture the redemption provisions applicable to additional
series of notes issued under such Supplemental Indenture. The Issuer may
determine to redeem such additional series of notes before redeeming the 2002-1
Series A&B Notes.

     (f) Notice of Redemption. The Indenture Trustee shall cause notice of any
redemption to be given by mailing a copy of the notice by first-class mail to
the Auction Agent and the Noteholder of any 2002-1 Series A&B Notes designated
for redemption in whole or in part, at their address as the same shall last
appear upon the registration books, in each case not less than 12 days prior to
the redemption date; provided, however, that failure to give such notice, or any
defect therein, shall not affect the validity of any proceedings for the
redemption of such 2002-1 Series A&B Notes for which no such failure or defect
occurs.

     (g) Partial Redemption. If less than all of the 2002-1 Series A&B Notes are
to be redeemed or purchased pursuant to Section 2.02(a) or (b) hereof, the
Series of Notes to be redeemed shall be determined by the Issuer; provided,
however, in the absence of any direction by the Issuer, the Series of Notes to
be redeemed shall be selected first from the Series B Notes to the extent
permitted hereby and, thereafter, in descending numerical order of the series
designation (beginning with the Series A-7 Notes); provided, however, that the
Issuer shall not direct the Indenture Trustee to redeem any Series of Notes
prior to the expiration of the Initial Period (as defined in Appendix A to this
Supplemental Indenture) applicable to that Series. If less than all Outstanding
Notes of any Series of 2002-1 Series A&B Notes are to be redeemed, the
particular Notes of that Series to be redeemed will be determined by lot in such
manner as the Indenture Trustee shall determine. In case a 2002-1 Series A&B
Note is of a denomination larger than an Authorized Denomination, a portion of
such Note (in an Authorized Denomination) may be redeemed. Upon surrender of any
2002-1 Series A&B Note for redemption in part only, the Issuer shall execute and
the Indenture Trustee shall authenticate and deliver to the Noteholder thereof,
the cost of which shall be paid by the Issuer, a new 2002-1 Series A&B Note or
2002-1 Series A&B


                                       7

<PAGE>

Notes of the same Series, maturity and of Authorized Denominations, in an
aggregate principal amount equal to the unredeemed portion of the 2002-1 Series
A&B Note surrendered.

     Section 2.03 Delivery of 2002-1 Series A&B Notes. Upon the execution and
delivery of this Supplemental Indenture, the Issuer shall execute and deliver to
the Indenture Trustee and the Indenture Trustee shall authenticate the 2002-1
Series A&B Notes and deliver the 2002-1 Series A&B Notes to The Depository Trust
Company; provided, however, prior to the delivery by the Indenture Trustee of
any of the 2002-1 Series A&B Notes, there shall have been filed with or
delivered to the Indenture Trustee the following:

          (a)  An Issuer Order authorizing the execution and delivery of this
     Supplemental Indenture and the issuance of the 2002-1 Series A&B Notes.

          (b)  Duly executed copies of this Supplemental Indenture and a copy of
     the Indenture.

          (c)  Rating letters from each Rating Agency confirming (i) that the
     Series A Notes have been rated "Aaa" by Moody's and "AAA" by Fitch and (ii)
     that the Series B Notes have been rated "A3" by Moody's and "A" by Fitch.

     Section 2.04 Trustee's Authentication Certificate. The Indenture Trustee's
authentication certificate upon the 2002-1 Series A&B Notes shall be
substantially in the forms provided in Exhibits A-1and A-2. No 2002-1 Series A&B
Note shall be secured hereby or entitled to the benefit hereof, or shall be
valid or obligatory for any purpose, unless a certificate of authentication,
substantially in such form, has been duly executed by the Indenture Trustee at
the written direction of the Issuer; and such certificate of the Indenture
Trustee upon any 2002-1 Series A&B Note shall be conclusive evidence and the
only competent evidence that such Note has been authenticated and delivered
hereunder. The Indenture Trustee's certificate of authentication shall be deemed
to have been duly executed by it if manually signed by an authorized officer of
the Indenture Trustee, but it shall not be necessary that the same person sign
the certificate of authentication on all of the 2002-1 Series A&B Notes issued
hereunder.

     Section 2.05 Deposit of 2002-1 Series A&B Note Proceeds. Upon the issuance
and delivery of the 2002-1 Series A&B Notes, the Indenture Trustee shall deposit
the net proceeds thereof (i.e., net of Initial Purchasers' discount of
$1,575,000):

     (a)  an amount equal to $509,100,000 shall be deposited to the Acquisition
Fund;

     (b)  an amount equal to $2,625,000 shall be deposited to the Reserve Fund;
and

     (c)  an amount equal to $11,700,000 shall be deposited to the Capitalized
Interest Fund.

     Section 2.06 Excess Reserve Fund Amounts.


                                       8

<PAGE>

     On any date on which the amount on deposit in the Reserve Fund exceeds the
Reserve Fund Requirement, the Indenture Trustee, at the direction of the
Administrator, shall transfer such excess from the Reserve Fund to the Revenue
Fund for application on the next Payment Date.

     Section 2.07 Forms of 2002-1 Series A&B Notes. The 2002-1 Series A&B Notes
shall be in substantially the form set forth in Exhibit A-1 and A-2 hereto, each
with such variations, omissions and insertions as may be necessary.

     Section 2.08 Regarding Acquisition Account. The Indenture Trustee shall
transfer to the Revenue Fund all moneys remaining in the Acquisition Fund
immediately after July 31, 2002; provided, however, that the transfer of such
moneys may be delayed upon receipt of a Rating Confirmation with respect to such
delay. Student Loans purchased with moneys in the Acquisition Fund after the
Date of Issuance shall only be used to acquire Federal Consolidation Loans
originated after January 1, 2000 with characteristics similar to the Student
Loans acquired on the Date of Issuance, including the underlying Stafford Loans
being consolidated into Consolidation Loans which in the aggregate consist of
45% Subsidized Stafford Loans and 55% Unsubsidized Stafford Loans.

                                   Article III

                               General Provisions

     Section 3.01 Date of Execution. This Supplemental Indenture for convenience
and for the purpose of reference is dated as of May 1, 2002.

     Section 3.02 Laws Governing. It is the intent of the parties hereto that
this Supplemental Indenture shall in all respects be governed by the laws of the
State of Ohio.

     Section 3.03 Severability. If any covenant, agreement, waiver, or part
thereof in this Supplemental Indenture contained be forbidden by any pertinent
law or under any pertinent law be effective to render this Supplemental
Indenture invalid or unenforceable or to impair the lien hereof, then each such
covenant, agreement, waiver, or part thereof shall itself be and is hereby
declared to be wholly ineffective, and this Supplemental Indenture shall be
construed as if the same were not included herein.

     Section 3.04 Exhibits and Appendices. The terms of each Exhibit and
Appendix attached to this Supplemental Indenture are incorporated herein in all
particulars.

                                   Article IV

                           Applicability of Indenture

     The provisions of the Indenture are hereby ratified, approved and
confirmed, except as otherwise expressly modified by this Supplemental
Indenture. The representations, warranties and covenants contained in the
Indenture (except as expressly modified herein) are hereby reaffirmed with the
same force and effect as if fully set forth herein and made again as of the date
hereof.


                                       9

<PAGE>

     In Witness Whereof, the Issuer has caused this Supplemental Indenture to be
executed in its name and on its behalf by the Co-Owner Trustee; the Indenture
Trustee, to evidence its acceptance of the trusts hereby created, has caused
this Supplemental Indenture to be executed in its name and behalf; and the Trust
Eligible Lender Trustee, to evidence its acceptance of the trusts hereby
created, has caused this Supplemental Indenture to be executed in its name and
behalf, all in multiple counterparts, each of which shall be deemed an original,
and the Issuer, the Indenture Trustee and the Trust Eligible Lender Trustee have
caused this Supplemental Indenture to be dated as of the date herein above first
shown, although actually executed on the dates shown in the acknowledgments
hereafter appearing.

                                      Education Funding Capital Trust-I,
                                          By Fifth Third Bank, not in its
                                          individual capacity, but solely as
                                          Co-Owner Trustee on behalf of the
                                          Trust


                                          By:  /s/ Keith E. Brock
                                             -----------------------------------
                                          Name:  Keith E. Brock
                                          Title: Trust Officer


                                      FIFTH THIRD BANK, not in its individual
                                          capacity but solely as Indenture
                                          Trustee


                                      By:  /s/ Keith E. Brock
                                          --------------------------------------
                                          Name:  Keith E. Brock
                                          Title: Trust Officer


                                      FIFTH THIRD BANK, not in its individual
                                          capacity but solely as Trust Eligible
                                          Lender Trustee


                                      By:  /s/ Keith E. Brock
                                          --------------------------------------
                                          Name:  Keith E. Brock
                                          Title: Trust Officer

<PAGE>

                                   Appendix A

                         Certain Terms and Provisions of
                             the Auction Rate Notes

                                    Article I

                                   Definitions

     Except as provided below in this Section, all terms that are defined in
Appendix A of the Indenture and Article I of this Supplemental Indenture shall
have the same meanings, respectively, in this Appendix A as such terms are given
in the Indenture and Article I of this Supplemental Indenture. In addition, the
following terms shall have the following respective meanings:

     "All Hold Rate" shall mean the Applicable LIBOR Rate less .20%; provided,
that in no event shall the applicable All Hold Rate be greater than the
applicable Maximum Rate.

     "Applicable LIBOR Rate" means, (a) for Auction Periods of 35 days or less,
One-Month LIBOR, (b) for Auction Periods of more than 35 days but less than 91
days, Three-Month LIBOR, (c) for Auction Periods of more than 90 days but less
than 181 days, Six-Month LIBOR, and (d) for Auction Periods of more than 180
days, One-Year LIBOR.

     "Auction" shall mean the implementation of the Auction Procedures on an
Auction Date.

     "Auction Agent" shall mean the Initial Auction Agent under the Initial
Auction Agent Agreement unless and until a Substitute Auction Agent Agreement
becomes effective, after which "Auction Agent" shall mean the Substitute Auction
Agent.

     "Auction Agent Agreement" shall mean the Initial Auction Agent Agreement
unless and until a Substitute Auction Agent Agreement is entered into, after
which "Auction Agent Agreement" shall mean such Substitute Auction Agent
Agreement.

     "Auction Agent Fee" has the meaning set forth in the Auction Agent
Agreement.

     "Auction Date" shall mean, initially, February 11, 2003 with respect to the
Series A-1 Notes, May 13, 2003 with respect to the Series A-2 Notes, May 20,
2003 with respect to the Series A-3 Notes, August 19, 2003 with respect to the
Series A-4 Notes, June 13, 2002 with respect to the Series A-5 Notes, June 20,
2002 with respect to the Series A-6 Notes, June 27, 2002 with respect to the
Series A-7 Notes, and June 20, 2002 with respect to the Series B-1 Notes, and
thereafter, the Business Day immediately preceding the first day of each Auction
Period for each respective Series, other than:

          (a)  each Auction Period commencing after the ownership of the
     applicable Auction Rate Notes is no longer maintained in Book-entry Form by
     the Securities Depository;


                                       A-1

<PAGE>

          (b)  each Auction Period commencing after and during the continuance
     of a Payment Default; or

          (c)  each Auction Period commencing less than two Business Days after
     the cure or waiver of a Payment Default.

Notwithstanding the foregoing, the Auction Date for one or more Auction Periods
may be changed pursuant to Section 2.02(h) of this Appendix A.

     "Auction Note Interest Rate" shall mean each variable rate of interest per
annum borne by Auction Rate Notes for each Auction Period and determined in
accordance with the provisions of Sections 2.01 and 2.02 of this Appendix A;
provided, however, that in the event of a Payment Default, the Auction Note
Interest Rate shall equal the applicable Non-Payment Rate; provided, further,
however that such Auction Note Interest Rate shall in no event exceed the lesser
of the Net Loan Rate and the Maximum Rate.

     "Auction Period" shall mean the Interest Period applicable to each Series
of Auction Rate Notes during which time the Auction Note Interest Rate for such
Series is determined pursuant to Section 2.02(a) of this Appendix A, which
Auction Period (after the Initial Period for such Series) shall begin on an
Interest Rate Adjustment Date and initially shall consist generally of 28 days
for the Auction Rate Notes, as the same may be adjusted pursuant to Section
2.02(g) of this Appendix A.

     "Auction Period Adjustment" shall mean an adjustment to the Auction Period
as provided in Section 2.02(g) of this Appendix A.

     "Auction Procedures" shall mean the procedures set forth in Section 2.02(a)
of this Appendix A by which the Auction Rate is determined.

     "Auction Rate" shall mean the rate of interest per annum that results from
implementation of the Auction Procedures and is determined as described in
Section 2.02(a)(iii)(B) of this Appendix A.

     "Auction Rate Notes" shall mean, collectively, the Series A Notes and the
Series B Notes.

     "Authorized Denominations" shall mean $50,000 and any integral multiple
thereof.

     "Available Auction Rate Notes" has the meaning set forth in Section
2.02(a)(iii)(A)(1) of this Appendix A.

     "Bid" has the meaning set forth in Section 2.02(a)(i)(A) of this Appendix
A.

     "Bid Auction Rate" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Bidder" has the meaning set forth in Section 2.02(a)(i)(A) of this
Appendix A.


                                       A-2

<PAGE>

     "Book-Entry Form" or "Book-Entry System" shall mean a form or system under
which (a) the beneficial right to principal and interest may be transferred only
through a book entry, (b) physical securities in registered form are issued only
to a Securities Depository or its nominee as Noteholder, with the securities
"immobilized" to the custody of the Securities Depository, and (c) the book
entry is the record that identifies the owners of beneficial interests in that
principal and interest.

     "Broker-Dealer" shall mean William R. Hough & Co. or any other broker or
dealer (each as defined in the Securities Exchange Act of 1934, as amended),
commercial bank or other entity permitted by law to perform the functions
required of a Broker-Dealer set forth in the Auction Procedures that (a) is a
Participant (or an affiliate of a Participant), (b) has been appointed as such
by the Issuer pursuant to Section 2.02(f) of this Appendix A, and (c) has
entered into a Broker-Dealer Agreement that is in effect on the date of
reference.

     "Broker-Dealer Agreements" shall mean the agreements between the Auction
Agent and the Broker-Dealers, and approved by the Issuer, pursuant to which the
Broker-Dealers agree to participate in Auctions as set forth in the Auction
Procedures, as from time to time amended or supplemented. The Broker-Dealer
Agreements shall be in substantially the form of the Broker-Dealer Agreement
dated as of May 1, 2002, among the Issuer, the Auction Agent, and the
Broker-Dealer.

     "Broker-Dealer Fee" has the meaning set forth in the Auction Agent
Agreement.

     "Business Day" shall mean any day other than a Saturday, Sunday, holiday or
day on which banks located in the City of New York, New York, or the New York
Stock Exchange, the Indenture Trustee or the Auction Agent, are authorized or
permitted by law or executive order to close or such other date as may be agreed
to in writing by the Auction Agent, the Broker-Dealers and the Issuer.

     "Cap Rate" shall mean, with respect to any Interest Period applicable to
the Auction Rate Notes, the lesser of (i) the applicable Maximum Rate and (ii)
the Net Loan Rate in effect for such Interest Period.

     "Carry-over Amount" shall mean, for any Interest Period during which
interest is calculated at the Net Loan Rate, the excess, if any, of (a) the
amount of interest on an Auction Rate Note that would have accrued with respect
to the related Interest Period at the lesser of (i) the applicable Auction Rate
and (ii) the Maximum Rate determined as if the Net Loan Rate were not a
component thereof over (b) the amount of interest on such Auction Rate Note
actually accrued with respect to such Auction Rate Note with respect to such
Interest Period based on the Net Loan Rate, together with the unreduced portion
of any such excess from prior Interest Periods; provided that any reference to
"principal" or "interest" in the Indenture and the Auction Rate Notes shall not
include within the meanings of such words any Carry-over Amount or any interest
accrued on any Carry-over Amount.

     "Closing Date" shall mean the Date of Issuance of the Auction Rate Notes
(May 23, 2002).


                                       A-3

<PAGE>

     "Effective Interest Rate" shall mean, with respect to any Financed Student
Loan, the interest rate per annum payable by the borrower as of the last day of
the calendar quarter borne by such Financed Student Loan after giving effect to
any reduction in such interest rate pursuant to borrower incentives, (a) less
all accrued rebate fees on such Financed Student Loan constituting Consolidation
Loans paid during such calendar quarter expressed as a percentage per annum and
(b) plus all accrued Interest Benefit Payments and Special Allowance Payments
applicable to such Financed Student Loan during such calendar quarter expressed
as a percentage per annum.

     "Eligible Carry-Over Make-Up Amount" shall mean, with respect to each
Interest Period relating to the Auction Rate Notes as to which, as of the first
day of such Interest Period, there is any unpaid Carry-over Amount, an amount
equal to the lesser of (a) interest computed on the principal balance of the
Auction Rate Notes in respect to such Interest Period at a per annum rate equal
to the excess, if any, of the Net Loan Rate over the Auction Rate, together with
the unreduced portion of any such excess from prior Interest Periods and (b) the
aggregate Carry-over Amount remaining unpaid as of the first day of such
Interest Period together with interest accrued and unpaid thereon through the
end of such Interest Period.

     "Existing Owner" shall mean (a) with respect to and for the purpose of
dealing with the Auction Agent in connection with an Auction, a Person who is a
Broker-Dealer listed in the Existing Owner Registry at the close of business on
the Business Day immediately preceding the Auction Date for such Auction and (b)
with respect to and for the purpose of dealing with the Broker-Dealers in
connection with an Auction, a Person who is a beneficial owner of Auction Rate
Notes.

     "Existing Owner Registry" shall mean the registry of Persons who are owners
of the Auction Rate Notes, maintained by the Auction Agent as provided in the
Auction Agent Agreement.

     "Hold Order" has the meaning set forth in Section 2.02(a)(i)(A) of this
Appendix A.

     "Initial Auction Agent" shall mean Deutsche Bank Trust Company Americas, a
New York banking corporation, and its successors and assigns.

     "Initial Auction Agent Agreement" shall mean, collectively, the Auction
Agent Agreement dated as of May 1, 2002, by and among the Issuer, the Indenture
Trustee and the Initial Auction Agent, including any amendment thereof or
supplement thereto.

     "Initial Payment Dates" shall mean, with respect to the Series A-1 Notes,
December 2, 2002 and February 12, 2003; with respect to the Series A-2 Notes,
December 2, 2002 and May 14, 2003; with respect to the Series A-3 Notes,
December 2, 2002 and May 21, 2003; with respect to the Series A-4 Notes,
December 2, 2002, June 2, 2003 and August 20, 2003; with respect to the Series
A-5 Notes, June 14, 2002; with respect to the Series A-6 Notes, June 21, 2002;
with respect to the Series A-7 Notes, June 28, 2002 and with respect to the
Series B-1 Notes, June 21, 2002.


                                      A-4

<PAGE>

     "Initial Period" shall mean, as to Auction Rate Notes, the period
commencing on the Closing Date and continuing through the day immediately
preceding the Initial Rate Adjustment Date for such Auction Rate Notes.

     "Initial Rate" shall mean 2.58% for the Series A-1 Notes, 2.93% for the
Series A-2 Notes, 2.86% for the Series A-3 Notes, 3.25% for the Series A-4
Notes, 2.05% for the Series A-5 Notes, 2.05% for the Series A-6 Notes, 2.05% for
the Series A-7 Notes, and 2.15% for the Series B-1 Notes.

     "Initial Rate Adjustment Date" shall mean, with respect to the Series A-1
Notes, February 12, 2003; with respect to the Series A-2 Notes, May 14, 2003;
with respect to the Series A-3 Notes, May 21, 2003; with respect to the Series
A-4 Notes, August 20, 2003; with respect to the Series A-5 Notes, June 14, 2002;
with respect to the Series A-6 Notes, June 21, 2002; with respect to the Series
A-7 Notes, June 28, 2002; and with respect to the Series B-1 Notes, June 21,
2002.

     "Interest Period" shall mean, with respect to the Auction Rate Notes, the
Initial Period and each period commencing on an Interest Rate Adjustment Date
for such Series and ending on and including the day before (a) the next Interest
Rate Adjustment Date for such Series or (b) the Stated Maturity of such Series,
as applicable.

     "Interest Rate Adjustment Date" shall mean the date on which an Auction
Note Interest Rate is effective, and shall mean, with respect to the Auction
Rate Notes, the date of commencement of each Auction Period.

     "Interest Rate Determination Date" shall mean, with respect to the Auction
Rate Notes, the Auction Date, or if no Auction Date is applicable to such
Series, the Business Day immediately preceding the date of commencement of an
Auction Period.

     "Market Agent" shall mean William R. Hough & Co.

     "Market Agent Agreement" shall mean the Market Agent Agreement dated as of
May 1, 2002 among the Market Agent, the Issuer and the Indenture Trustee, as the
same may be amended from time to time.

     "Maximum Rate" means the least of (a) either (i) the Applicable LIBOR Rate
plus 1.50% (if the ratings assigned by Moody's and Fitch to the Auction Rate
Notes are "Aaa" and "AAA," respectively, or better) or (ii) the Applicable LIBOR
Rate plus 2.50% (if any one of the ratings assigned by Moody's and Fitch to the
Auction Rate Notes is less than "Aaa" and "AAA," respectively, and greater than
or equal to "A3" and "A-," respectively), or (iii) the Applicable LIBOR Rate
plus 3.50% (if any one of the ratings assigned by Moody's and Fitch to the
Auction Rate Notes is less than "A3" and "A-," respectively), (b) 18% and (c)
the highest rate the Issuer may legally pay, from time to time, as interest on
the Auction Rate Notes. For purposes of the Auction Agent and the Auction
Procedures, the ratings referred to in this definition shall be the last ratings
of which the Auction Agent has been given written notice pursuant to the Auction
Agent Agreement.


                                      A-5

<PAGE>

     "Net Loan Rate" shall mean, respect to any Interest Period applicable to
the Auction Rate Notes, the rate of interest per annum (rounded to the next
highest one-hundredth of one percent) equal to (a) the weighted average
Effective Interest Rate of the Financed Student Loans for the calendar quarter
immediately preceding such Interest Period, as determined by the Administrator
on the last day of such calendar quarter, less (b) the Program Expense
Percentage, as determined by the Administrator on the last day of each calendar
year. In making the determinations in (a) and (b) of this definition of "Net
Loan Rate," the Administrator shall take into account as an increase to such Net
Loan Rate the receipt of any Reciprocal Payment and as a decrease to any Issuer
Derivative Payment. The determinations made by the Administrator in (a) and (b)
of this definition of "Net Loan Rate" shall be given in writing to the Auction
Agent, the Indenture Trustee and the Broker-Dealers immediately upon their
respective calculation dates.

     "Non-Payment Rate" shall mean One-Month LIBOR plus 1.50%.

     "One-Month LIBOR," "Three-Month LIBOR," "Six-Month LIBOR" or "One-Year
LIBOR," shall mean the rate per annum fixed by the British Bankers' Association
at 11:00 a.m., London time (BBA Libor rate), relating to quotations for London
Interbank Offered Rates on U.S. dollar deposits for the Applicable LIBOR Based
Rate, as determined by the Auction Agent or Indenture Trustee, as applicable.
Such rate may be available on the Internet at www.bba.org.uk. If such a day is
not a business day in London, the most recently fixed London Interbank Offered
Rates on U.S. dollar deposits for the Applicable LIBOR Based Rate shall be used.
If the rate is no longer available from such source, the Auction Agent or
Indenture Trustee, as applicable, will ascertain the rate in good faith from
such sources as it shall determine to be comparable to such source. All
percentages resulting from such calculations shall be rounded upwards, if
necessary, to the nearest one-hundredth of one percent.

     "Order" has the meaning set forth in Section 2.02(a)(i)(A) of this Appendix
A.

     "Payment Date" shall mean, initially with respect to each series of the
Notes, the applicable Initial Payment Dates and, thereafter (a) so long as a
series of the Notes bears interest at an Auction Note Interest Rate for an
Interest Period of not greater than 180 days, the Business Day immediately
following the expiration of the related Auction Period thereafter and (b) if and
for so long as a series of Notes bears interest at an Auction Note Interest Rate
for an Interest Period of greater than 180 days, the first Business Day of each
December and June.

     "Payment Default" shall mean, with respect to the Auction Rate Notes, (a) a
default in the due and punctual payment of any installment of interest on such
Auction Rate Notes, or (b) a default in the due and punctual payment of any
interest on and principal of such Auction Rate Notes at their maturity.

     "Potential Owner" shall mean any Person (including an Existing Owner that
is (a) a Broker-Dealer when dealing with the Auction Agent and (b) a potential
beneficial owner when dealing with a Broker-Dealer) who may be interested in
acquiring Auction Rate Notes (or, in the case of an Existing Owner thereof, an
additional principal amount of Auction Rate Notes).


                                      A-6

<PAGE>

     "Program Expense Percentage" shall mean, the percentage that all Program
Expenses (other than Consolidation Loan rebate fees) estimated for the next 12
months represent of the principal amount of the Notes, which as of May 23, 2002
is 0.60%, and which the Administrator shall calculate annually on the last day
of each calendar year. Any adjustment in the Program Expense Percentage shall be
effective beginning on the first Interest Rate Determination Date following each
such calculation.

     "Regular Record Date" shall mean, with respect to each Payment Date, the
Business Day immediately preceding such Payment Date.

     "Sell Order" has the meaning set forth in Section 2.02(a)(i)(A) of this
Appendix A.

     "Submission Deadline" shall mean 1:00 p.m., eastern time, on any Auction
Date or such other time on any Auction Date by which the Broker-Dealers are
required to submit Orders to the Auction Agent as specified by the Auction Agent
from time to time.

     "Submitted Bid" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Submitted Hold Order" has the meaning set forth in Section 2.02(a)(iii)(A)
of this Appendix A.

     "Submitted Order" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Submitted Sell Order" has the meaning set forth in Section 2.02(a)(iii)(A)
of this Appendix A.

     "Substitute Auction Agent" shall mean the Person with whom the Issuer and
the Indenture Trustee enter into a Substitute Auction Agent Agreement.

     "Substitute Auction Agent Agreement" shall mean an auction agent agreement
containing terms substantially similar to the terms of the Initial Auction Agent
Agreement, whereby a Person having the qualifications required by Section
2.02(e) of this Appendix A agrees with the Indenture Trustee and the Issuer to
perform the duties of the Auction Agent under this Appendix A.

     "Sufficient Bids" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Variable Rate" shall mean the variable rate of interest per annum,
including the Initial Rate, borne by each Series of Auction Rate Notes during
the Initial Period for such Series, and each Interest Period thereafter as such
rate of interest is determined in accordance with the provisions of Article II
of this Appendix A.


                                      A-7

<PAGE>

                                   Article II

                               Terms and Issuance

     Section 2.01 Auction Rate and Carry-Over Amounts. During the Initial
Period, each Series of Auction Rate Notes shall bear interest at the Initial
Rate for such Series. Thereafter, and except with respect to an Auction Period
Adjustment, the Auction Rate Notes shall bear interest at an Auction Note
Interest Rate based on a 28-day Auction Period for the Auction Rate Notes, as
determined pursuant to this Section 2.01 and Section 2.02 of this Appendix A.

     For the Auction Rate Notes during the Initial Period and each Auction
Period thereafter, interest at the applicable Auction Rate Notes Interest Rate
shall accrue daily and shall be computed for the actual number of days elapsed
on the basis of a year consisting of 360 days.

     The Auction Note Interest Rate to be borne by the Auction Rate Notes after
such Initial Period for each Auction Period until an Auction Period Adjustment,
if any, shall be determined as described below. Each such Auction Period after
the Initial Period shall commence on and include the day following the
expiration of the immediately preceding Auction Period and terminate on and
include (i) the second Business Day of the following fourth week in the case of
the Series A-1 Notes, the Series A-2 Notes, the Series A-3 Notes and the Series
A-4 Notes, and (ii) the fourth Business Day of the following fourth week in the
case of the Series A-5 Notes, the Series A-6 Notes, the Series A-7 Notes and the
Series B-1 Notes; provided, however, that in the case of the Auction Period that
immediately follows the Initial Period for the Auction Rate Notes, such Auction
Period shall commence on the Initial Rate Adjustment Date. The Auction Note
Interest Rate of the Auction Rate Notes for each Auction Period shall be the
Auction Rate in effect for such Auction Period as determined in accordance with
Section 2.02(a) of this Appendix A; provided that, if on any Interest Rate
Determination Date, an Auction is not held for any reason, the following
Business Day shall be considered the Interest Rate Determination Date and an
Auction is to be held on such date. If an Auction is not held for any reason on
such date, then the Auction Note Interest Rate on such Auction Rate Notes for
the next succeeding Auction Period shall be the applicable Cap Rate.

     Notwithstanding the foregoing:

          (a)  if the ownership of an Auction Rate Note is no longer maintained
     in Book-entry Form, the Auction Note Interest Rate on the Auction Rate
     Notes for any Interest Period commencing after the delivery of certificates
     representing Auction Rate Notes pursuant to this Supplemental Indenture
     shall equal the Cap Rate; or

          (b)  if a Payment Default shall have occurred, the Auction Note
     Interest Rate on the Auction Rate Notes for the Interest Period commencing
     on or immediately after such Payment Default, and for each Interest Period
     thereafter, to and including the Interest Period, if any, during which, or
     commencing less than two Business Days after, such Payment Default is
     cured, shall equal the applicable Non-Payment Rate on the first day of each
     such Interest Period.


                                      A-8

<PAGE>

     In accordance with Section 2.02(a)(iii)(B) and (C) of this Appendix A, the
Auction Agent shall promptly give written notice to the Indenture Trustee and
the Issuer of each Auction Note Interest Rate (unless the Auction Note Interest
Rate is the applicable Non-Payment Rate) and the Maximum Rate when such rate is
not the Auction Note Interest Rate, applicable to the Auction Rate Notes. The
Indenture Trustee shall, upon request, notify the Noteholders and the Issuer of
Auction Rate Notes of the applicable Auction Note Interest Rate applicable to
such Auction Rate Notes for each Auction Period not later than the third
Business Day of such Auction Period. Notwithstanding any other provision of the
Auction Rate Notes or this Supplemental Indenture and except for the occurrence
of a Payment Default, interest payable on the Auction Rate Notes for an Auction
Period shall never exceed for such Auction Period the amount of interest payable
at the applicable Maximum Rate in effect for such Auction Period.

     If the Auction Rate for the Auction Rate Notes is greater than the Net Loan
Rate, then the Variable Rate applicable to such Auction Rate Notes for that
Interest Period will be the Net Loan Rate and the Issuer shall determine the
Carry-over Amount, if any, with respect to such Auction Rate Notes for such
Interest Period.

     Such Carry-over Amount shall bear interest calculated at a rate equal to
One-Month LIBOR (as determined by the Indenture Trustee) from the Payment Date
for the Interest Period with respect to which such Carry-over Amount was
calculated, until paid. Any payment in respect of Carry-over Amount shall be
applied, first, to any accrued interest payable thereon and, second, in
reduction of such Carry-over Amount. For purposes of this Supplemental Indenture
and this Appendix A, any reference to "principal" or "interest" herein shall not
include within the meaning of such words Carry-over Amount or any interest
accrued on any such Carry-over Amount. Such Carry-over Amount shall be
separately calculated for each Auction Rate Note by the Issuer during such
Interest Period in sufficient time for the Indenture Trustee to give notice to
each Noteholder of such Carry-over Amount as required in the next succeeding
sentence. Not less than four days before the Payment Date for an Interest Period
with respect to which such Carry-over Amount has been calculated by the Issuer,
the Indenture Trustee shall give written notice to each Noteholder the Auction
Agent and the Issuer, in the form provided by the Issuer, of the Carry-over
Amount applicable to each Auction Rate Note, which written notice may accompany
the payment of interest made to the Noteholder on such Payment Date. Such notice
shall state, in addition to such Carry-over Amount, that, unless and until an
Auction Rate Note has been redeemed (other than by optional redemption), after
which all accrued Carry-over Amounts (and all accrued interest thereon) that
remains unpaid shall be canceled and no Carry-over Amount (and interest accrued
thereon) shall be paid with respect to such Auction Rate Note, (a) the
Carry-over Amount (and interest accrued thereon calculated at a rate equal to
One-Month LIBOR) shall be paid by the Indenture Trustee pursuant to an Issuer
Order on an Auction Rate Note on the earliest of (i) the date of defeasance of
the Auction Rate Notes or (ii) the first occurring Payment Date with respect to
the Auction Rate Note (or on the date of any such optional redemption) if and to
the extent that (A) the Eligible Carry-over Make-Up Amount with respect to such
subsequent Interest Period is greater than zero, and (B) moneys are available
pursuant to the terms of the Indenture in an amount sufficient to pay all or a
portion of such Carry-over Amount (and interest accrued thereon), and (b)
interest shall accrue on the Carry-over Amount at a rate equal to One-Month
LIBOR until such Carry-over Amount is paid in full or is cancelled.


                                      A-9

<PAGE>

     The Carry-over Amount (and interest accrued thereon) for Auction Rate Notes
shall be paid by the Indenture Trustee pursuant to an Issuer Order on
Outstanding Auction Rate Notes on the earliest of (a) the date of defeasance of
any of the Auction Rate Notes or (b) the first occurring Payment Date if and to
the extent that (i) the Eligible Carry-over Make-Up Amount with respect to such
Interest Period is greater than zero, and (ii) on such Payment Date there are
sufficient moneys in the Revenue Fund to pay all interest due on the Auction
Rate Notes on such Payment Date, to redeem any Auction Rate Notes required to be
redeemed on such Payment Date in accordance with the Indenture and to fund
amounts required to be added to the Reserve Fund on such Payment Date. Any
Carry-over Amount (and any interest accrued thereon) on any Auction Rate Note
which is due and payable on a Payment Date, which Auction Rate Note is to be
redeemed (other than by optional redemption) on said Payment Date, shall be paid
to the Noteholder thereof on said Payment Date to the extent that moneys are
available therefor in accordance with the provisions of this Appendix A;
provided, however, that any Carry-over Amount (and any interest accrued thereon)
which is not yet due and payable on said Payment Date shall be cancelled with
respect to said Auction Rate Note that is to be redeemed (other than by optional
redemption) on said Payment Date and shall not be paid on any succeeding Payment
Date. To the extent that any portion of the Carry-over Amount (and any interest
accrued thereon) remains unpaid after payment of a portion thereof, such unpaid
portion shall be paid in whole or in part as required hereunder until fully paid
by the Indenture Trustee on the earliest of (a) the date of defeasance of any of
the Auction Rate Notes or (b) the next occurring Payment Date or Dates, as
necessary, if and to the extent that the conditions in the second preceding
sentence are satisfied. On any Payment Date on which the Indenture Trustee pays
only a portion of the Carry-over Amount (and any interest accrued thereon) on
Auction Rate Notes, the Indenture Trustee shall give written notice in the
manner set forth in the immediately preceding paragraph to the Noteholder of
such Auction Rate Note receiving such partial payment of the Carry-over Amount
remaining unpaid on such Auction Rate Note.

     The Payment Date or other date on which such Carry-over Amount (or any
interest accrued thereon) for Auction Rate Notes shall be paid shall be
determined by the Indenture Trustee in accordance with the provisions of the
immediately preceding paragraph and the Indenture, and the Indenture Trustee
shall make payment of the Carry-over Amount (and any interest accrued thereon)
in the same manner as, and from the same Fund from which, it pays interest on
the Auction Rate Notes on a Payment Date. Any payment of Carry-over Amounts (and
interest accrued thereon) shall reduce the amount of Eligible Carry-over Make-up
Amount.

     In the event that the Auction Agent no longer determines, or fails to
determine, when required, the Auction Note Interest Rate with respect to Auction
Rate Notes, or, if for any reason such manner of determination shall be held to
be invalid or unenforceable, the Auction Note Interest Rate for the next
succeeding Interest Period, which Interest Period shall be an Auction Period,
for Auction Rate Notes shall be the applicable Cap Rate as determined by the
Auction Agent for such next succeeding Auction Period, and if the Auction Agent
shall fail or refuse to determine the Cap Rate, the Cap Rate shall be determined
by the securities dealer appointed by the Issuer capable of making such a
determination in accordance with the provisions of this Appendix A and written
notice of such determination shall be given by such securities dealer to the
Indenture Trustee.

     Section 2.02 Auction Rate.


                                      A-10

<PAGE>

     (a) Determining the Auction Rate. By purchasing Auction Rate Notes, whether
in an Auction or otherwise, each purchaser of the Auction Rate Notes, or its
Broker-Dealer, must agree and shall be deemed by such purchase to have agreed
(x) to participate in Auctions on the terms described herein, (y) to have its
beneficial ownership of the Auction Rate Notes maintained at all times in
Book-entry Form for the account of its Participant, which in turn will maintain
records of such beneficial ownership and (z) to authorize such Participant to
disclose to the Auction Agent such information with respect to such beneficial
ownership as the Auction Agent may request.

     So long as the ownership of Auction Rate Notes is maintained in Book-entry
Form by the Securities Depository, an Existing Owner may sell, transfer or
otherwise dispose of Auction Rate Notes only pursuant to a Bid or Sell Order
placed in an Auction or otherwise sell, transfer or dispose of Auction Rate
Notes through a Broker-Dealer, provided that, in the case of all transfers other
than pursuant to Auctions, such Existing Owner, its Broker-Dealer or its
Participant advises the Auction Agent of such transfer.

     Auctions shall be conducted on each Auction Date, if there is an Auction
Agent on such Auction Date, in the following manner:

    (i)   (A)  Prior to the Submission Deadline on each Auction Date;

               (1)  each Existing Owner of Auction Rate Notes may submit to a
          Broker-Dealer by telephone or otherwise any information as to:

                    a.   the principal amount of Outstanding Auction Rate Notes,
               if any, owned by such Existing Owner that such Existing Owner
               desires to continue to own without regard to the Auction Note
               Interest Rate for the next succeeding Auction Period;

                    b.   the principal amount of Outstanding Auction Rate Notes,
               if any, which such Existing Owner offers to sell if the Auction
               Note Interest Rate for the next succeeding Auction Period shall
               be less than the rate per annum specified by such Existing Owner;
               and/or

                    c.   the principal amount of Outstanding Auction Rate Notes,
               if any, owned by such Existing Owner that such Existing Owner
               offers to sell without regard to the Auction Note Interest Rate
               for the next succeeding Auction Period;

               and

               (2)  one or more Broker-Dealers may contact Potential Owners to
          determine the principal amount of Auction Rate Notes which each
          Potential Owner offers to purchase, if the Auction Note Interest Rate
          for the next succeeding Auction Period shall not be less than the rate
          per annum specified by such Potential Owner.


                                      A-11

<PAGE>

     The statement of an Existing Owner or a Potential Owner referred to in (1)
or (2) of this paragraph (A) is herein referred to as an "Order," and each
Existing Owner and each Potential Owner placing an Order is herein referred to
as a "Bidder"; an Order described in clause (1)a. is herein referred to as a
"Hold Order"; an Order described in clauses (1)b. and (2) is herein referred to
as a "Bid"; and an Order described in clause (1)c. is herein referred to as a
"Sell Order."

          (B)(1) Subject to the provisions of Section 2.02(a)(ii) of this
     Appendix A, a Bid by an Existing Owner shall constitute an irrevocable
     offer to sell:

                    a.   the principal amount of Outstanding Auction Rate Notes
               specified in such Bid if the Auction Note Interest Rate
               determined as provided in this Section 2.02(a) shall be less than
               the rate specified therein; or

                    b.   such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes to be determined as set forth in
               Section 2.02(a)(iv)(A)(4) of this Appendix A, if the Auction Note
               Interest Rate determined as provided in this Section 2.02(a)
               shall be equal to the rate specified therein; or

                    c.   such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes to be determined as set forth in
               Section 2.02(a)(iv)(B)(3) of this Appendix A, if the rate
               specified therein shall be higher than the applicable Maximum
               Rate and Sufficient Bids have not been made.

               (2)  Subject to the provisions of Section 2.02(a)(ii) of this
          Appendix A, a Sell Order by an Existing Owner shall constitute an
          irrevocable offer to sell:

                    a.   the principal amount of Outstanding Auction Rate Notes
               specified in such Sell Order; or

                    b.   such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes set forth in Section
               2.02(a)(iv)(B)(3) of this Appendix A, if Sufficient Bids have not
               been made.

               (3)  Subject to the provisions of Section 2.02(a)(ii) of this
          Appendix A, a Bid by a Potential Owner shall constitute an irrevocable
          offer to purchase:

                    a.   the principal amount of Outstanding Auction Rate Notes
               specified in such Bid if the Auction Note Interest Rate
               determined as provided in this Section 2.02(a) shall be higher
               than the rate specified in such Bid; or


                                      A-12

<PAGE>

                    b.   such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes set forth in Section
               2.02(a)(iv)(A)(5) of this Appendix A, if the Auction Note
               Interest Rate determined as provided in this Section 2.02(a)
               shall be equal to the rate specified in such Bid.

          (ii) (A)  Each Broker-Dealer shall submit in writing to the Auction
     Agent prior to the Submission Deadline on each Auction Date all Orders
     obtained by such Broker-Dealer and shall specify with respect to each such
     Order:

               (1)  the name of the Bidder placing such Order;

               (2)  the aggregate principal amount of Auction Rate Notes that
          are the subject of such Order;

               (3)  to the extent that such Bidder is an Existing Owner:

                         a.   the principal amount of Auction Rate Notes, if
                    any,  subject to any Hold Order placed by such Existing
                    Owner;

                         b.   the principal amount of Auction Rate Notes, if
                    any, subject to any Bid placed by such Existing Owner and
                    the rate specified in such Bid; and

                         c.   the principal amount of Auction Rate Notes, if
                    any, subject to any Sell Order placed by such Existing
                    Owner;

                    and

                    (4)  to the extent such Bidder is a Potential Owner, the
               rate specified in such Potential Owner's Bid.

               (B)  If any rate specified in any Bid contains more than three
          figures to the right of the decimal point, the Auction Agent shall
          round such rate up to the next higher one thousandth of 1%.

               (C)  If an Order or Orders covering all Outstanding Auction Rate
          Notes owned by an Existing Owner is not submitted to the Auction Agent
          prior to the Submission Deadline, the Auction Agent shall deem a Hold
          Order to have been submitted on behalf of such Existing Owner covering
          the principal amount of Outstanding Auction Rate Notes owned by such
          Existing Owner and not subject to an Order submitted to the Auction
          Agent.

               (D)  Neither the Issuer, the Indenture Trustee nor the Auction
          Agent shall be responsible for any failure of a Broker-Dealer to
          submit an Order to the Auction Agent on behalf of any Existing Owner
          or Potential Owner.


                                      A-13

<PAGE>

               (E)  If any Existing Owner submits through a Broker-Dealer to the
          Auction Agent one or more Orders covering in the aggregate more than
          the principal amount of Outstanding Auction Rate Notes owned by such
          Existing Owner, such Orders shall be considered valid as follows and
          in the following order of priority:

                    (1)  All Hold Orders shall be considered valid, but only up
               to the aggregate principal amount of Outstanding Auction Rate
               Notes owned by such Existing Owner, and if the aggregate
               principal amount of Auction Rate Notes subject to such Hold
               Orders exceeds the aggregate principal amount of Auction Rate
               Notes owned by such Existing Owner, the aggregate principal
               amount of Auction Rate Notes subject to each such Hold Order
               shall be reduced pro rata so that the aggregate principal amount
               of Auction Rate Notes subject to such Hold Order equals the
               aggregate principal amount of Outstanding Auction Rate Notes
               owned by such Existing Owner.

                    (2)  a.   Any Bid shall be considered valid up to an amount
               equal to the excess of the principal amount of Outstanding
               Auction Rate Notes owned by such Existing Owner over the
               aggregate principal amount of Auction Rate Notes subject to any
               Hold Order referred to in clause (A) of this paragraph (ii);

                         b.   subject to subclause (2)a. of this clause (E), if
                    more than one Bid with the same rate is submitted on behalf
                    of such Existing Owner and the aggregate principal amount of
                    Outstanding Auction Rate Notes subject to such Bids is
                    greater than such excess, such Bids shall be considered
                    valid up to an amount equal to such excess;

                         c.   subject to subclauses (2)a. and (2)b. of this
                    clause (E), if more than one Bid with different rates are
                    submitted on behalf of such Existing Owner, such Bids shall
                    be considered valid first in the ascending order of their
                    respective rates until the highest rate is reached at which
                    such excess exists and then at such rate up to the amount of
                    such excess; and

                         d.   in any such event, the amount of Outstanding
                    Auction Rate Notes, if any, subject to Bids not valid under
                    this clause (E) shall be treated as the subject of a Bid by
                    a Potential Owner at the rate therein specified; and

                    (3)  All Sell Orders shall be considered valid up to an
               amount equal to the excess of the principal amount of Outstanding
               Auction Rate Notes owned by such Existing Owner over the
               aggregate principal amount of Auction Rate Notes subject to Hold
               Orders referred to in clause (1) of


                                      A-14

<PAGE>

                      this paragraph (E) and valid Bids referred to in clause
                      (2) of this paragraph (E).

                      (F)  If more than one Bid for Auction Rate Notes is
               submitted on behalf of any Potential Owner, each Bid submitted
               shall be a separate Bid with the rate and principal amount
               therein specified.

                      (G)  An Existing Owner that offers to purchase additional
               Auction Rate Notes is, for purposes of such offer, treated as a
               Potential Owner.

                      (H)  Any Bid or Sell Order submitted by an Existing Owner
               covering an aggregate principal amount of Auction Rate Notes not
               equal to an Authorized Denomination shall be rejected and shall
               be deemed a Hold Order. Any Bid submitted by a Potential Owner
               covering an aggregate principal amount of Auction Rate Notes not
               equal to an Authorized Denomination shall be rejected.

                      (I)  Any Bid specifying a rate higher than the applicable
               Maximum Rate will (1) be treated as a Sell Order if submitted by
               an Existing Owner and (2) not be accepted if submitted by a
               Potential Owner.

                      (J)  Any Order submitted in an Auction by a Broker-Dealer
               to the Auction Agent prior to the Submission Deadline on any
               Auction Date shall be irrevocable.

               (iii)  (A)  Not earlier than the Submission Deadline on each
         Auction Date, the Auction Agent shall assemble all valid Orders
         submitted or deemed submitted to it by the Broker-Dealers (each such
         Order as submitted or deemed submitted by a Broker-Dealer being herein
         referred to individually as a "Submitted Hold Order," a "Submitted Bid"
         or a "Submitted Sell Order," as the case may be, or as a "Submitted
         Order," and collectively as "Submitted Hold Orders," "Submitted Bids"
         or "Submitted Sell Orders," as the case may be, or as "Submitted
         Orders") and shall determine:

                           (1)  the excess of the total principal amount of
                      Outstanding Auction Rate Notes over the sum of the
                      aggregate principal amount of Outstanding Auction Rate
                      Notes subject to Submitted Hold Orders (such excess being
                      herein referred to as the "Available Auction Rate Notes"),
                      and

                           (2)  from the Submitted Orders whether:

                                a.   the aggregate principal amount of
                           Outstanding Auction Rate Notes subject to Submitted
                           Bids by Potential Owners specifying one or more rates
                           equal to or lower than the applicable Maximum Rate;

                      exceeds or is equal to the sum of:


                                      A-15

<PAGE>

                                b.   the aggregate principal amount of
                           Outstanding Auction Rate Notes subject to Submitted
                           Bids by Existing Owners specifying one or more rates
                           higher than the applicable Maximum Rate; and

                                c.   the aggregate principal amount of
                           Outstanding Auction Rate Notes subject to Submitted
                           Sell Orders;

                     (in the event such excess or such equality exists, other
                     than because all of the Outstanding Auction Rate Notes are
                     subject to Submitted Hold Orders, such Submitted Bids
                     described in subclause a. above shall be referred to
                     collectively as "Sufficient Bids"); and

                           (3)  if Sufficient Bids exist, the Bid Auction Rate,
                     which shall be the lowest rate specified in such Submitted
                     Bids such that if:

                                a. (x) each Submitted Bid from Existing Owners
                           specifying such lowest rate and (y) all other
                           Submitted Bids from Existing Owners specifying lower
                           rates were rejected, thus entitling such Existing
                           Owners to continue to own the principal amount of
                           Auction Rate Notes subject to such Submitted Bids;
                           and

                                b. (x) each such Submitted Bid from Potential
                           Owners specifying such lowest rate and (y) all other
                           Submitted Bids from Potential Owners specifying lower
                           rates were accepted;

                     the result would be that such Existing Owners described in
                     subclause a. above would continue to own an aggregate
                     principal amount of Outstanding Auction Rate Notes which,
                     when added to the aggregate principal amount of Outstanding
                     Auction Rate Notes to be purchased by such Potential Owners
                     described in subclause b. above, would equal not less than
                     the Available Auction Rate Notes.

                     (B)   Promptly after the Auction Agent has made the
               determinations pursuant to Section 2.02(a)(iii)(A) of this
               Appendix A, the Auction Agent shall advise the Indenture Trustee,
               the Broker-Dealers and the Issuer of the Net Loan Rate, Maximum
               Rate and the All Hold Rate and the components thereof on the
               Auction Date. Based on such determinations, the Auction Rate for
               the next succeeding Interest Period will be established as
               follows:

                           (1)  if Sufficient Bids exist, that the Auction Rate
                     for the next succeeding Interest Period shall be equal to
                     the Bid Auction Rate so determined;

                           (2)  if Sufficient Bids do not exist (other than
                     because all of the Outstanding Auction Rate Notes are
                     subject to Submitted Hold Orders),


                                      A-16

<PAGE>

                     that the Auction Rate for the next succeeding Interest
                     Period shall be equal to the applicable Maximum Rate; or

                           (3)   if all Outstanding Auction Rate Notes are
                     subject to Submitted Hold Orders, that the Auction Rate for
                     the next succeeding Interest Period shall be equal to the
                     applicable All Hold Rate.

                     (C)   Promptly after the Auction Agent has determined the
               Auction Rate, the Auction Agent shall determine and advise the
               Indenture Trustee of the Auction Note Interest Rate, which rate
               shall be the lesser of (x) the Auction Rate and (y) the
               applicable Maximum Rate.

               (iv)   Existing Owners shall continue to own the principal amount
         of Auction Rate Notes that are subject to Submitted Hold Orders. If the
         Net Loan Rate is equal to or greater than the Bid Auction Rate and if
         Sufficient Bids have been received by the Auction Agent, the Bid
         Auction Rate will be the Auction Note Interest Rate, and Submitted Bids
         and Submitted Sell Orders will be accepted or rejected and the Auction
         Agent will take such other action as described below in subparagraph
         (A).

         If the Maximum Rate is less than the Auction Rate, the Maximum Rate
will be the Auction Note Interest Rate. If the Auction Agent has not received
Sufficient Bids (other than because all of the Outstanding Auction Rate Notes
are subject to Submitted Hold Orders), the Auction Note Interest Rate will be
the applicable Maximum Rate. In any of the cases described above, Submitted
Orders will be accepted or rejected and the Auction Agent will take such other
action as described below in subparagraph (B).

                     (A)   If Sufficient Bids have been made and the Maximum
               Rate is equal to or greater than the Bid Auction Rate (in which
               case the Auction Note Interest Rate shall be the Bid Auction
               Rate), all Submitted Sell Orders shall be accepted and, subject
               to the provisions of clauses (4) and (5) of this Section
               2.02(a)(iv), Submitted Bids shall be accepted or rejected as
               follows in the following order of priority, and all other
               Submitted Bids shall be rejected:

                           (1)   Existing Owners' Submitted Bids specifying any
                     rate that is higher than the Auction Note Interest Rate
                     shall be accepted, thus requiring each such Existing Owner
                     to sell the aggregate principal amount of Auction Rate
                     Notes subject to such Submitted Bids;

                           (2)   Existing Owners' Submitted Bids specifying any
                     rate that is lower than the Auction Note Interest Rate
                     shall be rejected, thus entitling each such Existing Owner
                     to continue to own the aggregate principal amount of
                     Auction Rate Notes subject to such Submitted Bids;

                           (3)   Potential Owners' Submitted Bids specifying any
                     rate that is lower than the Auction Note Interest Rate
                     shall be accepted;


                                      A-17

<PAGE>

                           (4)   Each Existing Owners' Submitted Bid specifying
                     a rate that is equal to the Auction Note Interest Rate
                     shall be rejected, thus entitling such Existing Owner to
                     continue to own the aggregate principal amount of Auction
                     Rate Notes subject to such Submitted Bid, unless the
                     aggregate principal amount of Outstanding Auction Rate
                     Notes subject to all such Submitted Bids shall be greater
                     than the principal amount of Auction Rate Notes (the
                     "remaining principal amount") equal to the excess of the
                     Available Auction Rate Notes over the aggregate principal
                     amount of Auction Rate Notes subject to Submitted Bids
                     described in clauses (2) and (3) of this Section
                     2.02(a)(iv)(A), in which event such Submitted Bid of such
                     Existing Owner shall be rejected in part, and such Existing
                     Owner shall be entitled to continue to own the principal
                     amount of Auction Rate Notes subject to such Submitted Bid,
                     but only in an amount equal to the aggregate principal
                     amount of Auction Rate Notes obtained by multiplying the
                     remaining principal amount by a fraction, the numerator of
                     which shall be the principal amount of Outstanding Auction
                     Rate Notes owned by such Existing Owner subject to such
                     Submitted Bid and the denominator of which shall be the sum
                     of the principal amount of Outstanding Auction Rate Notes
                     subject to such Submitted Bids made by all such Existing
                     Owners that specified a rate equal to the Auction Note
                     Interest Rate, subject to the provisions of Section
                     2.02(a)(iv)(D) of this Appendix A; and

                           (5)   Each Potential Owner's Submitted Bid specifying
                     a rate that is equal to the Auction Note Interest Rate
                     shall be accepted, but only in an amount equal to the
                     principal amount of Auction Rate Notes obtained by
                     multiplying the excess of the aggregate principal amount of
                     Available Auction Rate Notes over the aggregate principal
                     amount of Auction Rate Notes subject to Submitted Bids
                     described in clauses (2), (3) and (4) of this Section
                     2.02(a)(iv)(A) by a fraction the numerator of which shall
                     be the aggregate principal amount of Outstanding Auction
                     Rate Notes subject to such Submitted Bid and the
                     denominator of which shall be the sum of the principal
                     amount of Outstanding Auction Rate Notes subject to
                     Submitted Bids made by all such Potential Owners that
                     specified a rate equal to the Auction Note Interest Rate,
                     subject to the provisions of Section 2.02(a)(iv)(D) of this
                     Appendix A.

                     (B)   If Sufficient Bids have not been made (other than
               because all of the Outstanding Auction Rate Notes are subject to
               submitted Hold Orders), or if the Maximum Rate is less than the
               Bid Auction Rate (in which case the Auction Note Interest Rate
               shall be the Maximum Rate), subject to the provisions of Section
               2.02(a)(iv)(D) of this Appendix A, Submitted Orders shall be
               accepted or rejected as follows in the following order of
               priority and all other Submitted Bids shall be rejected:

                           (1)   Existing Owners' Submitted Bids specifying any
                     rate that is equal to or lower than the Auction Note
                     Interest Rate shall be rejected, thus


                                      A-18

<PAGE>

                     entitling such Existing Owners to continue to own the
                     aggregate principal amount of Auction Rate Notes subject to
                     such Submitted Bids;

                           (2)   Potential Owners' Submitted Bids specifying (x)
                     any rate that is equal to or lower than the Auction Note
                     Interest Rate shall be accepted and (y) any rate that is
                     higher than the Auction Note Interest Rate shall be
                     rejected; and

                           (3)   each Existing Owner's Submitted Bid specifying
                     any rate that is higher than the Auction Note Interest Rate
                     and the Submitted Sell Order of each Existing Owner shall
                     be accepted, thus entitling each Existing Owner that
                     submitted any such Submitted Bid or Submitted Sell Order to
                     sell the Auction Rate Notes subject to such Submitted Bid
                     or Submitted Sell Order, but in both cases only in an
                     amount equal to the aggregate principal amount of Auction
                     Rate Notes obtained by multiplying the aggregate principal
                     amount of Auction Rate Notes subject to Submitted Bids
                     described in clause (2)(x) of this Section 2.02(a)(iv)(B)
                     by a fraction the numerator of which shall be the aggregate
                     principal amount of Outstanding Auction Rate Notes owned by
                     such Existing Owner subject to such submitted Bid or
                     Submitted Sell Order and the denominator of which shall be
                     the aggregate principal amount of Outstanding Auction Rate
                     Notes subject to all such Submitted Bids and Submitted Sell
                     Orders.

                     (C)   If all Auction Rate Notes are subject to Submitted
               Hold Orders, all Submitted Bids shall be rejected.

                     (D)   If, as a result of the procedures described in
               paragraph (A) or (B) of this Section 2.02(a)(iv), any Existing
               Owner would be entitled or required to sell, or any Potential
               Owner would be entitled or required to purchase, a principal
               amount of Auction Rate Notes that is not equal to an Authorized
               Denomination, the Auction Agent shall, in such manner as in its
               sole discretion it shall determine, round up or down the
               principal amount of Auction Rate Notes to be purchased or sold by
               any Existing Owner or Potential Owner so that the principal
               amount of Auction Rate Notes purchased or sold by each Existing
               Owner or Potential Owner shall be equal to an Authorized
               Denomination.

                     (E)   If, as a result of the procedures described in
               paragraph (B) of this Section 2.02(a)(iv), any Potential Owner
               would be entitled or required to purchase less than an Authorized
               Denomination of Auction Rate Notes, the Auction Agent shall, in
               such manner as in its sole discretion it shall determine,
               allocate Auction Rate Notes for purchase among Potential Owners
               so that only Auction Rate Notes in Authorized Denominations are
               purchased by any Potential Owner, even if such allocation results
               in one or more of such Potential Owners not purchasing any
               Auction Rate Notes.


                                      A-19

<PAGE>

               (v)    Based on the result of each Auction, the Auction Agent
         shall determine the aggregate principal amount of Auction Rate Notes to
         be purchased and the aggregate principal amount of Auction Rate Notes
         to be sold by Potential Owners and Existing Owners on whose behalf each
         Broker-Dealer submitted Bids or Sell Orders and, with respect to each
         Broker-Dealer, to the extent that such aggregate principal amount of
         Auction Rate Notes to be sold differs from such aggregate principal
         amount of Auction Rate Notes to be purchased, determine to which other
         Broker-Dealer or Broker-Dealers acting for one or more purchasers such
         Broker-Dealer shall deliver, or from which other Broker-Dealer or
         Broker-Dealers acting for one or more sellers such Broker-Dealer shall
         receive, as the case may be, Auction Rate Notes.

               (vi)   Any calculation by the Auction Agent or the Indenture
         Trustee, as applicable, of the Auction Note Interest Rate, the Maximum
         Rate, the All Hold Rate, the Net Loan Rate and the Non-Payment Rate
         shall, in the absence of manifest error, be binding on all other
         parties.

               (vii)  Notwithstanding anything in this Appendix A to the
         contrary, (A) no Auction for the Auction Rate Notes for an Auction
         Period of less than 180 days will be held on any Auction Date hereunder
         on which there are insufficient moneys in the Revenue Fund to pay, or
         otherwise held by the Indenture Trustee under the Indenture and
         available to pay, the principal of and interest due on the Auction Rate
         Notes on the Payment Date immediately following such Auction Date, and
         (B) no Auction will be held on any Auction Date hereunder during the
         continuance of a Payment Default. The Indenture Trustee shall promptly
         notify the Auction Agent of any such occurrence.

         (b)   Application of Interest Payments for the Auction Rate Notes.

               (i)    The Indenture Trustee shall determine not later than 2:00
         p.m., eastern time, on the Business Day next succeeding a Payment Date,
         whether a Payment Default has occurred. If a Payment Default has
         occurred, the Indenture Trustee shall, not later than 2:15 p.m.,
         eastern time, on such Business Day, send a notice thereof in
         substantially the form of Exhibit C attached hereto to the Auction
         Agent by telecopy or similar means and, if such Payment Default is
         cured, the Indenture Trustee shall immediately send a notice in
         substantially the form of Exhibit D attached hereto to the Auction
         Agent by telecopy or similar means.

               (ii)   Not later than 2:00 p.m., eastern time, on each
         anniversary of the Closing Date, the Indenture Trustee shall pay to the
         Auction Agent, in immediately available funds out of amounts in the
         Revenue Fund, an amount equal to the Auction Agent Fee as set forth in
         the Auction Agent Agreement as set forth in the Servicer's Report. Not
         later than 2:00 p.m., eastern time, on each Auction Date, the Indenture
         Trustee shall pay to the Auction Agent, in immediately available funds
         out of amounts in the Revenue Fund, an amount equal to the
         Broker-Dealer Fee as calculated in the Auction Agent Agreement. The
         Indenture Trustee shall, from time to time at the request of the
         Auction Agent and at the direction of an Authorized Officer, reimburse
         the Auction Agent for its reasonable


                                      A-20

<PAGE>

         expenses as provided in the Auction Agent Agreement, such expenses to
         be paid out of amounts in the Revenue Fund.

         (c)   Calculation of Maximum Rate, All Hold Rate, Net Loan Rate,
Applicable LIBOR Rate, and Non-Payment Rate. The Auction Agent shall calculate
the applicable Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold
Rate, as the case may be, on each Auction Date and shall notify the Indenture
Trustee and the Broker-Dealers of the applicable Maximum Rate, Net Loan Rate,
Applicable LIBOR Rate, and All Hold Rate, as the case may be, as provided in the
Auction Agent Agreement; provided, that if the ownership of the Auction Rate
Notes is no longer maintained in Book-entry Form, or if a Payment Default has
occurred, then the Indenture Trustee shall determine the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and Non-Payment Rate
for each such Interest Period. If the ownership of the Auction Rate Notes is no
longer maintained in Book-entry Form by the Securities Depository, the Indenture
Trustee shall calculate the applicable Maximum Rate and the Net Loan Rate on the
Business Day immediately preceding the first day of each Interest Period after
the delivery of certificates representing the Auction Rate Notes pursuant to the
Indenture. If a Payment Default shall have occurred, the Indenture Trustee shall
calculate the Non-Payment Rate on the Interest Rate Determination Date for (i)
each Interest Period commencing after the occurrence and during the continuance
of such Payment Default and (ii) any Interest Period commencing less than two
Business Days after the cure of any Payment Default. The determination by the
Indenture Trustee or the Auction Agent, as the case may be, of the applicable
Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and
Non-Payment Rate shall (in the absence of manifest error) be final and binding
upon all parties. If calculated or determined by the Auction Agent, the Auction
Agent shall promptly advise the Indenture Trustee of the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold Rate.

         (d)   Notification of Rates, Amounts and Payment Dates.

               (i)   By 12:00 noon, eastern time, on the Business Day following
         each Regular Record Date, the Indenture Trustee shall determine the
         aggregate amounts of interest distributable on the next succeeding
         Payment Date to the beneficial owners of Auction Rate Notes.

               (ii)  At least four days prior to any Payment Date, the Indenture
         Trustee shall:

                     (A)   confirm with the Auction Agent, so long as no Payment
               Default has occurred and is continuing and the ownership of the
               Auction Rate Notes is maintained in Book-entry Form by the
               Securities Depository, (1) the date of such next Payment Date and
               (2) the amount payable to the Auction Agent on the Auction Date
               pursuant to Section 2.02(b)(ii) of this Appendix A; and

                     (B)   advise the Securities Depository, so long as the
               ownership of the Auction Rate Notes is maintained in Book-entry
               Form by the Securities Depository, upon request, of the aggregate
               amount of interest distributable on such next Payment Date to the
               beneficial owners of each Series of the Auction Rate Notes.


                                      A-21

<PAGE>

     If any day scheduled to be a Payment Date shall be changed after the
Indenture Trustee shall have given the notice or confirmation referred to in
clause (i) of the preceding sentence, the Indenture Trustee shall, not later
than 11:15 a.m., eastern time, on the Business Day next preceding the earlier of
the new Payment Date or the old Payment Date, by such means as the Indenture
Trustee deems practicable, give notice of such change to the Auction Agent, so
long as no Payment Default has occurred and is continuing and the ownership of
the Auction Rate Notes is maintained in Book-entry Form by the Securities
Depository.

     (e)  Auction Agent.

          (i)   Deutsche Bank Trust Company Americas is hereby appointed as
     Initial Auction Agent to serve as agent for the Issuer in connection with
     Auctions. The Indenture Trustee and the Issuer will, and the Indenture
     Trustee is hereby directed to, enter into the Initial Auction Agent
     Agreement with Deutsche Bank Trust Company Americas, as the Initial Auction
     Agent. Any Substitute Auction Agent shall be (A) a bank, national banking
     association or trust company duly organized under the laws of the United
     States of America or any state or territory thereof having its principal
     place of business in the Borough of Manhattan, New York, or such other
     location as approved by the Indenture Trustee in writing and having a
     combined capital stock or surplus of at least $50,000,000, or (B) a member
     of the National Association of Securities Dealers, Inc., having a
     capitalization of at least $50,000,000, and, in either case, authorized by
     law to perform all the duties imposed upon it hereunder and under the
     Auction Agent Agreement. The Auction Agent may at any time resign and be
     discharged of the duties and obligations created by this Appendix A by
     giving at least 90 days' notice to the Indenture Trustee, each
     Broker-Dealer and the Issuer. The Auction Agent may be removed at any time
     by the Indenture Trustee upon the written direction of an Authorized
     Officer or by the holders of a majority of the aggregate principal amount
     of the Auction Rate Notes then Outstanding, and if by such Noteholders, by
     an instrument signed by such Noteholders or their attorneys and filed with
     the Auction Agent, the Issuer and the Indenture Trustee upon at least 90
     days' written notice. Neither resignation nor removal of the Auction Agent
     pursuant to the preceding two sentences shall be effective until and unless
     a Substitute Auction Agent has been appointed and has accepted such
     appointment. If required by the Issuer, a Substitute Auction Agent
     Agreement shall be entered into with a Substitute Auction Agent.
     Notwithstanding the foregoing, the Auction Agent may terminate the Auction
     Agent Agreement if, within 25 days after notifying the Indenture Trustee,
     each Broker-Dealer and the Issuer in writing that it has not received
     payment of any Auction Agent Fee due it in accordance with the terms of the
     Auction Agent Agreement, the Auction Agent does not receive such payment.

          (ii)  If the Auction Agent shall resign or be removed or be dissolved,
     or if the property or affairs of the Auction Agent shall be taken under the
     control of any state or federal court or administrative body because of
     bankruptcy or insolvency, or for any other reason, the Indenture Trustee at
     the direction of an Authorized Officer, shall use its best efforts to
     appoint a Substitute Auction Agent.


                                      A-22

<PAGE>

          (iii) The Auction Agent is acting as agent for the Issuer in
     connection with Auctions. In the absence of bad faith, negligent failure to
     act or negligence on its part, the Auction Agent shall not be liable for
     any action taken, suffered or omitted or any error of judgment made by it
     in the performance of its duties under the Auction Agent Agreement and
     shall not be liable for any error of judgment made in good faith unless the
     Auction Agent shall have been negligent in ascertaining (or failing to
     ascertain) the pertinent facts.

     (f)  Broker-Dealer.

          (i)   The Auction Agent will enter into a Broker-Dealer Agreement with
     William R. Hough & Co. as the initial Broker-Dealer. An Authorized Officer
     may, from time to time, approve one or more additional persons to serve as
     a Broker-Dealer under the Broker-Dealer Agreements and shall be responsible
     for providing such Broker-Dealer Agreements to the Indenture Trustee and
     the Auction Agent.

          (ii)  Any Broker-Dealer may be removed at any time, at the request of
     an Authorized Officer, but there shall, at all times, be at least one
     Broker-Dealer appointed and acting as such.

     (g)  Changes in Auction Period or Periods and Certain Percentages.

          (i)   While any of the Auction Rate Notes are Outstanding, the Issuer
     may, from time to time, change the length of one or more Auction Periods
     (an "Auction Period Adjustment"), in order to conform with then current
     market practice with respect to similar securities or to accommodate
     economic and financial factors that may affect or be relevant to the length
     of the Auction Period and the interest rate borne by the Auction Rate
     Notes. The Issuer shall not initiate an Auction Period Adjustment unless it
     shall have received the written consent of the Market Agent, which consent
     shall not be unreasonably withheld, not later than nine days prior to the
     Auction Date for such Auction Period. The Issuer shall initiate the Auction
     Period Adjustment by giving written notice by Issuer Order to the Indenture
     Trustee, the Auction Agent, the Market Agent, each Broker-Dealer, each
     Rating Agency and the Securities Depository in substantially the form of,
     or containing substantially the information contained in, Exhibit E
     attached hereto at least 10 days prior to the Auction Date for such Auction
     Period.

          (ii)  Any such adjusted Auction Period shall not be less than 7 days
     nor more than 366 days.

          (iii) An Auction Period Adjustment shall take effect only if (A) the
     Indenture Trustee and the Auction Agent receive, by 11:00 a.m., eastern
     time, on the Business Day before the Auction Date for the first such
     Auction Period, an Issuer Certificate in substantially the form attached
     as, or containing substantially the same information contained in, Exhibit
     F attached hereto, authorizing the Auction Period Adjustment specified in
     such certificate along with a copy of the written consent of the Market
     Agent and, (B) Sufficient Bids exist as of the Auction on the Auction Date
     for such first Auction Period. If the condition referred to in (A) above is
     not met, the applicable Auction Note


                                      A-23



<PAGE>

     Interest Rate for the next Auction Period shall be determined pursuant to
     the above provisions of this Section 2.02 and the Auction Period shall be
     the Auction Period determined without reference to the proposed change. If
     the condition referred to in (A) is met but the condition referred in (B)
     above is not met, the applicable Auction Note Interest Rate for the next
     Auction Period shall be the applicable Maximum Rate and the Auction Period
     shall be the Auction Period determined without reference to the proposed
     change.

     In connection with any Auction Period Adjustment, the Auction Agent shall
provide such further notice to such parties as is specified in Section 2.03 of
the Auction Agent Agreement.

     (h)  Changes in the Auction Date. The Market Agent, with the written
consent of the Administrator on behalf of the Issuer and, if applicable, upon
receipt of the opinion of Note Counsel as required below, may specify a
different Auction Date (but in no event more than five Business Days earlier
than the Auction Date that would otherwise be determined in accordance with the
definition of "Auction Date" in Section 1.01 of this Appendix A) with respect to
one or more specified Auction Periods in order to conform with then current
market practice with respect to similar securities or to accommodate economic
and financial factors that may affect or be relevant to the day of the week
constituting an Auction Date and the interest rate borne on the Auction Rate
Notes. The Market Agent shall deliver a written request for consent to such
change in the length of the Auction Date to the Administrator at least 14 days
prior to the effective date of such change. If the Administrator shall have
delivered such written consent to the Market Agent, the Market Agent shall
provide notice of its determination to specify an earlier Auction Date for one
or more Auction Periods by means of a written notice delivered at least 10 days
prior to the proposed changed Auction Date to the Indenture Trustee, the Auction
Agent, the Issuer, the Administrator, each Rating Agency and the Securities
Depository. Such notice shall be substantially in the form of, or contain
substantially the information contained in, Exhibit G attached hereto.

     In connection with any change described in this Section 2.02(h), the
Auction Agent shall provide such further notice to such parties as is specified
in Section 2.03 of the Auction Agent Agreement.

     Section 2.03 Additional Provisions Regarding the Interest Rates on the
Auction Rate Notes. The determination of a Variable Rate by the Auction Agent or
any other Person pursuant to the provisions of the applicable Section of this
Article II shall be conclusive and binding on the Noteholders of the Auction
Rate Notes to which such Variable Rate applies, and the Issuer and the Indenture
Trustee may rely thereon for all purposes.

     In no event shall the cumulative amount of interest paid or payable on the
Auction Rate Notes (including interest calculated as provided herein, plus any
other amounts that constitute interest on the Auction Rate Notes under
applicable law, which are contracted for, charged, reserved, taken or received
pursuant to the Auction Rate Notes or related documents) calculated from the
Date of Closing of the Auction Rate Notes through any subsequent day during the
term of the Auction Rate Notes or otherwise prior to payment in full of the
Auction Rate Notes exceed the amount permitted by applicable law. If the
applicable law is ever judicially interpreted so as to render usurious any
amount called for under the Auction Rate Notes or related documents or


                                      A-24

<PAGE>

otherwise contracted for, charged, reserved, taken or received in connection
with the Auction Rate Notes, or if the redemption or acceleration of the
maturity of the Auction Rate Notes results in payment to or receipt by the
Noteholder or any former Noteholder of the Auction Rate Notes of any interest in
excess of that permitted by applicable law, then, notwithstanding any provision
of the Auction Rate Notes or related documents to the contrary, all excess
amounts theretofore paid or received with respect to the Auction Rate Notes
shall be credited on the principal balance of the Auction Rate Notes (or, if the
Auction Rate Notes have been paid or would thereby be paid in full, refunded by
the recipient thereof), and the provisions of the Auction Rate Notes and related
documents shall automatically and immediately be deemed reformed and the amounts
thereafter collectible hereunder and thereunder reduced, without the necessity
of the execution of any new document, so as to comply with the applicable law,
but so as to permit the recovery of the fullest amount otherwise called for
under the Auction Rate Notes and under the related documents.


                                      A-25

<PAGE>

                                   EXHIBIT A-1

                             FORM OF SERIES A NOTES

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

EXCEPT AS OTHERWISE PROVIDED IN THE INDENTURE, THIS GLOBAL NOTE MAY BE
TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES
DEPOSITORY (AS DEFINED IN THE INDENTURE) OR TO A SUCCESSOR SECURITIES DEPOSITORY
OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY.

NEITHER THIS NOTE NOR ANY BENEFICIAL INTEREST HEREIN HAS BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT'). EACH OF THE
HOLDER HEREOF AND EACH OWNER OF A BENEFICIAL INTEREST HEREIN, BY HOLDING THIS
NOTE AND ACQUIRING THEIR BENEFICIAL INTERESTS HEREIN, RESPECTIVELY, AGREES FOR
THE BENEFIT OF EDUCATION FUNDING CAPITAL TRUST-I (THE "ISSUER") THAT THIS NOTE
AND BENEFICIAL INTERESTS HEREIN MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
ONLY (1) TO THE ISSUER, (2) SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A
IN ACCORDANCE WITH RULE 144A OR AN INSTITUTIONAL ACCREDITED INVESTOR AS DEFINED
IN RULE 501(a)(l), (2), (3) OR (7) OF THE SECURITIES ACT THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER OR AN
INSTITUTIONAL ACCREDITED INVESTOR TO WHOM NOTICE IS GIVEN THAT THE RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144(A), (3) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE) OF
REGULATION S UNDER THE SECURITIES ACT (4) PURSUANT TO AN EXEMPTION FROM
REGISTRATION IN ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE)
(RESALES DESCRIBED IN SUBCLAUSES (1) THROUGH (4) BEING REFERRED-TO AS "SAFE
HARBOR RESALES"), (5) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT (PROVIDED THAT AS A CONDITION
TO REGISTRATION OF TRANSFER OF THIS NOTE OTHERWISE THAN IN A SAFE HARBOR RESALE
THE ISSUER OR THE INDENTURE TRUSTEE MAY REQUIRE


                                     A-1-1

<PAGE>

DELIVERY OF ANY DOCUMENTS OR OTHER EVIDENCE THAT IT, IN ITS ABSOLUTE DISCRETION,
DEEMS NECESSARY OR APPROPRIATE TO EVIDENCE COMPLIANCE WITH SUCH EXEMPTION AND
WITH ANY STATE SECURITIES LAWS THAT MAY BE APPLICABLE), OR (6) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND IN EACH OF SUCH
CASES IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAW OF ANY STATE OF THE
UNITED STATES. EACH OWNER OF A BENEFICIAL INTEREST IN THIS NOTE, BY ACQUIRING
SUCH BENEFICIAL INTEREST, REPRESENTS AND AGREES FOR THE BENEFIT OF THE ISSUER
THAT IT WILL NOTIFY ANY PURCHASER OF SUCH BENEFICIAL INTEREST FROM IT OF THE
RESALE RESTRICTIONS REFERRED TO ABOVE. THIS LEGEND WILL BE REMOVED ONLY IN THE
CIRCUMSTANCES SPECIFIED IN THE INDENTURE.


                        EDUCATION FUNDING CAPITAL TRUST-I
                     AUCTION RATE EDUCATION LOAN BACKED NOTE
                                SERIES 2002A-___

REGISTERED NO. A-__                                 REGISTERED $________________

MATURITY DATE        INTEREST RATE      ORIGINAL ISSUE DATE        CUSIP NO.
-------------        -------------      -------------------        ---------
June 1, 2042      As Herein Provided        May 23, 2002          28139R A___

PRINCIPAL SUM:  ________________________________________ DOLLARS
NOTEHOLDER: CEDE & CO.

     EDUCATION FUNDING CAPITAL TRUST-I, a business trust formed under the laws
of the State of Delaware (the "Issuer") for value received, hereby promises to
pay to CEDE & CO. (the "Noteholder") or registered assigns, ____________________
DOLLARS (the "Principal Sum"), but solely from the revenues and receipts
hereinafter specified and not otherwise, on June 1, 2042 (the "Maturity Date")
(subject to the right of prior redemption hereinafter described), upon
presentation and surrender of this Note at the Corporate Trust Office of the
Indenture Trustee, as paying agent for the Notes, or a duly appointed successor
paying agent, and to pay interest in arrears on said Principal Sum, but solely
from the revenues and receipts hereinafter specified and not otherwise, to the
Noteholder hereof from the most recent Payment Date to which interest has been
paid hereon, until the payment in full of the Principal Sum.

     Any capitalized words and terms used as defined words and terms in this
Note and not otherwise defined herein shall have the meanings given to them in
the Indenture of Trust dated as of May ___, 2002 (the "Indenture") among the
Issuer, Fifth Third Bank, as Indenture Trustee, and Fifth Third Bank, as Trust
Eligible Lender Trustee, as supplemented by the 2002-1 Series A&B Supplemental
Indenture of Trust dated as of May ___, 2002 (the "2002-1 Series A&B
Supplemental Indenture") among the Issuer, Fifth Third Bank, as Indenture
Trustee, and Fifth Third Bank, as Trust Eligible Lender Trustee.


                                     A-1-2

<PAGE>

     This Note shall bear interest at an Auction Rate, all as determined in
Appendix A of the 2002-1 Series A&B Supplemental Indenture.

     The principal of and interest on this Note are payable in lawful money of
the United States of America. Interest payable on this Note shall be computed on
the assumption that each year contains 360 days and actual days elapsed.

     This Note is one of a Series of Notes of the Issuer designated Auction Rate
Education Loan Backed Notes, Series 2002A-___, dated May 23, 2002 (the "Original
Issue Date"), in the aggregate original principal amount of $_______________
(the "Series A-___ Notes"), which have been authorized and issued by the Issuer
pursuant to the Indenture and the 2002-1 Series A&B Supplemental Indenture. The
Issuer is, simultaneously with the issuance of the Series A-___ Notes, issuing
$_______________ of its Auction Rate Education Loan Backed Notes, 2002-1 Series
A Notes in six other classes (together with the Series A-___ Notes, the "Series
A Notes"), and $26,500,000 of its Auction Rate Education Loan Backed Notes,
2002-1 Series B Notes in one class (the "Series B Notes"). The proceeds of such
Notes have been used by the Issuer, together with other moneys of the Issuer,
for the purpose of providing funds to finance the acquisition of education
loans, fund a reserve fund and to pay certain costs and expenses in connection
with the issuance of such Notes.

     The Indenture provides for the issuance of additional Notes (the
"Additional Notes"), which may be secured on a parity with or subordinate to the
Series A Notes and secured senior to, on a parity with or subordinate to the
Series B Notes, all as determined by the Issuer. The Series A Notes, the Series
B Notes, and any Additional Notes are collectively referred to herein as the
"Notes."

     This Note is subject to mandatory redemption and optional redemption, all
as described in the Indenture.

     Notice of the call for redemption shall be given by the Indenture Trustee
by mailing a copy of the notice at least 12 days prior to the redemption date to
the Noteholders of the Notes to be redeemed in whole or in part at the address
of such Noteholder last showing on the registration books. Failure to give such
notice or any defect therein shall not affect the validity of any proceedings
for the redemption of such Notes for which no such failure or defect occurs. All
Notes called for redemption will cease to bear interest after the specified
redemption date, provided funds for their payment are on deposit at the place of
payment at the time. If less than all Notes are to be redeemed, Notes shall be
selected for redemption as provided in the Indenture.

     The Indenture provides that the Issuer may enter into a Derivative Product
between the Issuer and a Counterparty. Payments due to a Counterparty from the
Issuer pursuant to the applicable Derivative Product are referred to herein as
"Issuer Derivative Payments," and may be secured on a parity with any Series of
Notes.

     The principal of and interest on the Series A Notes and any Additional
Notes issued on a parity with the Series A Notes and any Issuer Derivative
Payments secured on a parity with the Series A Notes are payable on a superior
basis to such payments on the Series B Notes and any


                                     A-1-3

<PAGE>

Additional Notes issued on a parity or subordinate to the Series B Notes;
provided, however, that current principal and interest may be paid on the Series
B Notes and any Additional Notes issued on a parity with the Series B Notes or
subordinate to the Series B Notes if all principal and interest payments due and
owing at such time on the Series A Notes and any Additional Notes issued on a
parity with the Series A Notes and any Issuer Derivative Payments secured on a
parity with the Series A Notes have been previously made or provided for as
provided in the Indenture.

     Reference is hereby made to the Indenture and the 2002-1 Series A&B
Supplemental Indenture, copies of which are on file in the Corporate Trust
Office of the Indenture Trustee, to all of the provisions of which any
Noteholder of this Note by his acceptance hereof hereby assents, for definitions
of terms; the description of and the nature and extent of the security for the
Notes; the Issuer's education loan origination and acquisition program; the
revenues and other money pledged to the payment of the principal of and interest
on the Notes; the nature and extent and manner of enforcement of the pledge; the
conditions upon which the Indenture may be amended or supplemented with or
without the consent of the Noteholders and any Counterparty; the rights and
remedies of the Noteholder hereof with respect hereto and thereto, including the
limitations upon the right of a Noteholder hereof to institute any suit, action,
or proceeding in equity or at law with respect hereto and thereto; the rights,
duties, and obligations of the Issuer and the Indenture Trustee thereunder; the
terms and provisions upon which the liens, pledges, charges, trusts, and
covenants made therein may be discharged at or prior to the Stated Maturity or
earlier redemption of this Note, and this Note thereafter shall no longer be
secured by the Indenture or be deemed to be Outstanding thereunder; and for the
other terms and provisions thereof.

     THE NOTES ARE LIMITED OBLIGATIONS OF THE ISSUER, PAYABLE SOLELY FROM, AND
FURTHER SECURED BY, THE TRUST ESTATE, AS DEFINED IN THE INDENTURE.

     No recourse, either directly or indirectly, shall be had for the payment of
the principal of and interest on this Note or any claim based hereon or in
respect hereof or of the Indenture, against the Indenture Trustee, or any
employee, or agent of the Issuer, nor against the State of Delaware, or any
official thereof, but the obligation to pay all amounts required by the
Indenture securing this Note and the obligation to do and perform the covenants
and acts required of the Issuer therein and herein shall be and remain the
responsibility and obligation of said Issuer, limited as herein set forth.

     Subject to the restrictions specified in the Indenture, this Note is
transferable on the registration books kept for that purpose by the Indenture
Trustee, as registrar, upon surrender of this Note for transfer at the Corporate
Trust Office of the Indenture Trustee, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Noteholder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of the same Series, Stated
Maturity, of authorized denominations, bearing interest at the same rate, and
for the same aggregate principal amount will be issued to the designated
transferee or transferees. At the option of the Noteholder, any Note may be
exchanged for other Notes in authorized denominations upon surrender of the Note
to be exchanged at the Corporate Trust Office of the Indenture Trustee. Upon any
such presentation for exchange, one or more new Notes of the same Series, Stated
Maturity, in authorized denominations, bearing interest at the


                                     A-1-4

<PAGE>

same rate, and for the same aggregate principal amount as the Note or Notes so
surrendered will be issued to the Noteholder of the Note or Notes so
surrendered; and the Note or Notes so surrendered shall thereupon be cancelled
by the Indenture Trustee.

     Notwithstanding the foregoing, so long as the ownership of the Notes is
maintained in book-entry form by The Depository Trust Company (the "Securities
Depository") or a nominee thereof, this Note may be transferred in whole but not
in part only to the Securities Depository or a nominee thereof or to a successor
Securities Depository or its nominee.

     The Issuer, the Indenture Trustee, and any agent of either of them shall
treat the Person in whose name this Note is registered as the Noteholder hereof
(a) on the record date for purposes of receiving timely payment of interest
hereon, and (b) on the date of surrender of this Note for purposes of receiving
payment of principal hereof at its Stated Maturity and (c) for all other
purposes, whether or not this Note is overdue, and neither the Issuer, the
Indenture Trustee, nor any such agent shall be affected by notice to the
contrary.

     To the extent permitted by the Indenture, modifications or alterations of
the Indenture and the 2002-1 Series A&B Supplemental Indenture may be made with
the consent of less than all of the holders of the Notes then Outstanding or
without the consent of any of such Noteholders (by reason of a change in the Act
or Regulation, to cure ambiguities or conflicts, or for any other reason stated
in Section 7.01 of the Indenture), but such modification or alteration is not
permitted to affect the Maturity, Stated Maturity, amount, Payment Date, or rate
of interest on any Outstanding Notes or affect the rights of the Noteholders of
less than all of the Notes Outstanding.

     It is hereby certified and recited that all acts and things required by the
laws of the State of Delaware to happen, exist, and be performed precedent to
and in the issuance of this Note, and the execution of said Indenture, have
happened, exist and have been performed as so required.


                                     A-1-5

<PAGE>

     IN WITNESS WHEREOF, the Issuer has caused this Note to be executed in its
name and on its behalf, all as of the Original Issue Date.

                                        EDUCATION FUNDING CAPITAL TRUST-I

                                        By:   FIFTH THIRD BANK,
                                              as Co-Owner Trustee,

                                        By _____________________________________
                                              Name:
                                              Title:


                                     A-1-6



<PAGE>

                          CERTIFICATE OF AUTHENTICATION

     This Note is one of the Series A-__ Notes designated therein and described
in the within-mentioned Indenture.

                                        Fifth Third Bank, as Indenture Trustee


                                        By:_____________________________________
                                            Authorized Signatory

Authentication Date:

____________________________________


                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
unto __________ (Social Security or other identifying number __________) the
within Note and all rights thereunder and hereby irrevocably appoints __________
attorney to transfer the within Note on the books kept for registration thereof,
with full power of substitution in the premises.

Dated:                                  Signed:

____________________________________    ________________________________________

                                        NOTICE: The signature on this Assignment
                                        must correspond with the name of the
                                        Noteholder as it appears on the face of
                                        the within Note in every particular.

Signature Guaranteed by:

____________________________________
A Member of The New York Stock
Exchange or a State or National Bank


                                     A-1-7

<PAGE>

                                   EXHIBIT A-2

                             FORM OF SERIES B NOTES

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

EXCEPT AS OTHERWISE PROVIDED IN THE INDENTURE, THIS GLOBAL NOTE MAY BE
TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES
DEPOSITORY (AS DEFINED IN THE INDENTURE) OR TO A SUCCESSOR SECURITIES DEPOSITORY
OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY.

NEITHER THIS NOTE NOR ANY BENEFICIAL INTEREST HEREIN HAS BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT'). EACH OF THE
HOLDER HEREOF AND EACH OWNER OF A BENEFICIAL INTEREST HEREIN, BY HOLDING THIS
NOTE AND ACQUIRING THEIR BENEFICIAL INTERESTS HEREIN, RESPECTIVELY, AGREES FOR
THE BENEFIT OF EDUCATION FUNDING CAPITAL TRUST-I (THE "ISSUER") THAT THIS NOTE
AND BENEFICIAL INTERESTS HEREIN MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
ONLY (1) TO THE ISSUER, (2) SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE PURSUANT
TO RULE 144A UNDER THE SECURITIES ACT ("RULE 144A"), TO A PERSON WHOM THE SELLER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER AS DEFINED IN RULE 144A
IN ACCORDANCE WITH RULE 144A OR AN INSTITUTIONAL ACCREDITED INVESTOR AS DEFINED
IN RULE 501(a)(l), (2), (3) OR (7) OF THE SECURITIES ACT THAT PURCHASES FOR ITS
OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER OR AN
INSTITUTIONAL ACCREDITED INVESTOR TO WHOM NOTICE IS GIVEN THAT THE RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144(A), (3) IN AN
OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904 (AS APPLICABLE) OF
REGULATION S UNDER THE SECURITIES ACT (4) PURSUANT TO AN EXEMPTION FROM
REGISTRATION IN ACCORDANCE WITH RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE)
(RESALES DESCRIBED IN SUBCLAUSES (1) THROUGH (4) BEING REFERRED-TO AS "SAFE
HARBOR RESALES"), (5) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
REGISTRATION REQUIREMENTS UNDER THE SECURITIES ACT (PROVIDED THAT AS A CONDITION
TO REGISTRATION OF TRANSFER OF THIS NOTE OTHERWISE THAN IN A SAFE HARBOR RESALE
THE ISSUER OR THE INDENTURE TRUSTEE MAY REQUIRE


                                     A-2-1

<PAGE>

DELIVERY OF ANY DOCUMENTS OR OTHER EVIDENCE THAT IT, IN ITS ABSOLUTE DISCRETION,
DEEMS NECESSARY OR APPROPRIATE TO EVIDENCE COMPLIANCE WITH SUCH EXEMPTION AND
WITH ANY STATE SECURITIES LAWS THAT MAY BE APPLICABLE), OR (6) PURSUANT TO AN
EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, AND IN EACH OF SUCH
CASES IN ACCORDANCE WITH ANY APPLICABLE SECURITIES LAW OF ANY STATE OF THE
UNITED STATES. EACH OWNER OF A BENEFICIAL INTEREST IN THIS NOTE, BY ACQUIRING
SUCH BENEFICIAL INTEREST, REPRESENTS AND AGREES FOR THE BENEFIT OF THE ISSUER
THAT IT WILL NOTIFY ANY PURCHASER OF SUCH BENEFICIAL INTEREST FROM IT OF THE
RESALE RESTRICTIONS REFERRED TO ABOVE. THIS LEGEND WILL BE REMOVED ONLY IN THE
CIRCUMSTANCES SPECIFIED IN THE INDENTURE.


                        EDUCATION FUNDING CAPITAL TRUST-I
                     AUCTION RATE EDUCATION LOAN BACKED NOTE
                                 SERIES 2002B-1

REGISTERED NO. A-__                              REGISTERED $26,500,000

MATURITY DATE      INTEREST RATE          ORIGINAL ISSUE DATE    CUSIP NO.
-------------      -------------          -------------------    ----------
 June 1, 2042      As Herein Provided         May 23, 2002       28139R A___

PRINCIPAL SUM:  TWENTY-SIX MILLION FIVE HUNDRED THOUSAND DOLLARS
NOTEHOLDER: CEDE & CO.

     EDUCATION FUNDING CAPITAL TRUST-I, a business trust formed under the laws
of the State of Delaware (the "Issuer") for value received, hereby promises to
pay to CEDE & CO. (the "Noteholder") or registered assigns, TWENTY-SIX MILLION
FIVE HUNDRED THOUSAND DOLLARS (the "Principal Sum"), but solely from the
revenues and receipts hereinafter specified and not otherwise, on June 1, 2042
(the "Maturity Date") (subject to the right of prior redemption hereinafter
described), upon presentation and surrender of this Note at the Corporate Trust
Office of the Indenture Trustee, as paying agent for the Notes, or a duly
appointed successor paying agent, and to pay interest in arrears on said
Principal Sum, but solely from the revenues and receipts hereinafter specified
and not otherwise, to the Noteholder hereof from the most recent Payment Date to
which interest has been paid hereon, until the payment in full of the Principal
Sum.

     Any capitalized words and terms used as defined words and terms in this
Note and not otherwise defined herein shall have the meanings given to them in
the Indenture of Trust dated as of May ___, 2002 (the "Indenture") among the
Issuer, Fifth Third Bank, as Indenture Trustee, and Fifth Third Bank, as Trust
Eligible Lender Trustee, as supplemented by the 2002-1 Series A&B Supplemental
Indenture of Trust dated as of May ___, 2002 (the "2002-1 Series A&B
Supplemental Indenture") among the Issuer, Fifth Third Bank, as Indenture
Trustee, and Fifth Third Bank, as Trust Eligible Lender Trustee.


                                     A-2-2

<PAGE>

     This Note shall bear interest at an Auction Rate, all as determined in
Appendix A of the 2002-1 Series A&B Supplemental Indenture.

     The principal of and interest on this Note are payable in lawful money of
the United States of America. Interest payable on this Note shall be computed on
the assumption that each year contains 360 days and actual days elapsed.

     This Note is one of a Series of Notes of the Issuer designated Auction Rate
Education Loan Backed Notes, Series 2002B-1, dated May 23, 2002 (the "Original
Issue Date"), in the aggregate original principal amount of $26,500,000 (the
"Series B Notes"), which have been authorized by the Issuer, and issued by the
Issuer pursuant to the Indenture and the 2002-1 Series A&B Supplemental
Indenture. The Issuer is, simultaneously with the issuance of the Series B
Notes, issuing $498,500,000 of its Auction Rate Education Loan Backed Notes,
2002-1 Series A Notes in seven classes (collectively, the "Series A Notes"). The
proceeds of such Notes have been used by the Issuer, together with other moneys
of the Issuer, for the purpose of providing funds to finance the acquisition of
education loans, fund a reserve fund and to pay certain costs and expenses in
connection with the issuance of such Notes.

     The Indenture provides for the issuance of additional Notes (the
"Additional Notes"), which may be secured on a parity with or subordinate to the
Series A Notes and secured senior to, on a parity with or subordinate to the
Series B Notes, all as determined by the Issuer. The Series A Notes, the Series
B Notes, and any Additional Notes are collectively referred to herein as the
"Notes."

     This Note is subject to mandatory redemption and optional redemption, all
as described in the Indenture.

     Notice of the call for redemption shall be given by the Indenture Trustee
by mailing a copy of the notice at least 12 days prior to the redemption date to
the Noteholders of the Notes to be redeemed in whole or in part at the address
of such Noteholder last showing on the registration books. Failure to give such
notice or any defect therein shall not affect the validity of any proceedings
for the redemption of such Notes for which no such failure or defect occurs. All
Notes called for redemption will cease to bear interest after the specified
redemption date, provided funds for their payment are on deposit at the place of
payment at the time. If less than all Notes are to be redeemed, Notes shall be
selected for redemption as provided in the Indenture.

     The Indenture provides that the Issuer may enter into a Derivative Product
between the Issuer and a Counterparty. Payments due to a Counterparty from the
Issuer pursuant to the applicable Derivative Product are referred to herein as
"Issuer Derivative Payments," and may be secured on a parity with any Series of
Notes.

     The principal of and interest on the Series A Notes and any Additional
Notes issued on a parity with the Series A Notes and any Issuer Derivative
Payments secured on a parity with the Series A Notes are payable on a superior
basis to such payments on the Series B Notes and any Additional Notes issued on
a parity or subordinate to the Series B Notes; provided, however, that current
principal and interest may be paid on the Series B Notes and any Additional
Notes issued


                                     A-2-3

<PAGE>

on a parity with the Series B Notes or subordinate to the Series B Notes if all
principal and interest payments due and owing at such time on the Series A Notes
and any Additional Notes issued on a parity with the Series A Notes and any
Issuer Derivative Payments secured on a parity with the Series A Notes have been
previously made or provided for as provided in the Indenture.

     Reference is hereby made to the Indenture and the 2002-1 Series A&B
Supplemental Indenture, copies of which are on file in the Corporate Trust
Office of the Indenture Trustee, to all of the provisions of which any
Noteholder of this Note by his acceptance hereof hereby assents, for definitions
of terms; the description of and the nature and extent of the security for the
Notes; the Issuer's education loan origination and acquisition program; the
revenues and other money pledged to the payment of the principal of and interest
on the Notes; the nature and extent and manner of enforcement of the pledge; the
conditions upon which the Indenture may be amended or supplemented with or
without the consent of the Noteholders and any Counterparty; the rights and
remedies of the Noteholder hereof with respect hereto and thereto, including the
limitations upon the right of a Noteholder hereof to institute any suit, action,
or proceeding in equity or at law with respect hereto and thereto; the rights,
duties, and obligations of the Issuer and the Indenture Trustee thereunder; the
terms and provisions upon which the liens, pledges, charges, trusts, and
covenants made therein may be discharged at or prior to the Stated Maturity or
earlier redemption of this Note, and this Note thereafter shall no longer be
secured by the Indenture or be deemed to be Outstanding thereunder; and for the
other terms and provisions thereof.

     THE NOTES ARE LIMITED OBLIGATIONS OF THE ISSUER, PAYABLE SOLELY FROM, AND
FURTHER SECURED BY, THE TRUST ESTATE, AS DEFINED IN THE INDENTURE.

     No recourse, either directly or indirectly, shall be had for the payment of
the principal of and interest on this Note or any claim based hereon or in
respect hereof or of the Indenture, against the Indenture Trustee, or any
employee, or agent of the Issuer, nor against the State of Delaware, or any
official thereof, but the obligation to pay all amounts required by the
Indenture securing this Note and the obligation to do and perform the covenants
and acts required of the Issuer therein and herein shall be and remain the
responsibility and obligation of said Issuer, limited as herein set forth.

     Subject to the restrictions specified in the Indenture, this Note is
transferable on the registration books kept for that purpose by the Indenture
Trustee, as registrar, upon surrender of this Note for transfer at the Corporate
Trust Office of the Indenture Trustee, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Noteholder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of the same Series, Stated
Maturity, of authorized denominations, bearing interest at the same rate, and
for the same aggregate principal amount will be issued to the designated
transferee or transferees. At the option of the Noteholder, any Note may be
exchanged for other Notes in authorized denominations upon surrender of the Note
to be exchanged at the Corporate Trust Office of the Indenture Trustee. Upon any
such presentation for exchange, one or more new Notes of the same Series, Stated
Maturity, in authorized denominations, bearing interest at the same rate, and
for the same aggregate principal amount as the Note or Notes so surrendered will
be


                                     A-2-4

<PAGE>

issued to the Noteholder of the Note or Notes so surrendered; and the Note or
Notes so surrendered shall thereupon be cancelled by the Indenture Trustee.

     Notwithstanding the foregoing, so long as the ownership of the Notes is
maintained in book-entry form by The Depository Trust Company (the "Securities
Depository") or a nominee thereof, this Note may be transferred in whole but not
in part only to the Securities Depository or a nominee thereof or to a successor
Securities Depository or its nominee.

     The Issuer, the Indenture Trustee, and any agent of either of them shall
treat the Person in whose name this Note is registered as the Noteholder hereof
(a) on the record date for purposes of receiving timely payment of interest
hereon, and (b) on the date of surrender of this Note for purposes of receiving
payment of principal hereof at its Stated Maturity and (c) for all other
purposes, whether or not this Note is overdue, and neither the Issuer, the
Indenture Trustee, nor any such agent shall be affected by notice to the
contrary.

     To the extent permitted by the Indenture, modifications or alterations of
the Indenture and the 2002-1 Series A&B Supplemental Indenture may be made with
the consent of less than all of the holders of the Notes then Outstanding or
without the consent of any of such Noteholders (by reason of a change in the Act
or Regulation, to cure ambiguities or conflicts, or for any other reason stated
in Section 7.01 of the Indenture), but such modification or alteration is not
permitted to affect the Maturity, Stated Maturity, amount, Payment Date, or rate
of interest on any Outstanding Notes or affect the rights of the Noteholders of
less than all of the Notes Outstanding.

     It is hereby certified and recited that all acts and things required by the
laws of the State of Delaware to happen, exist, and be performed precedent to
and in the issuance of this Note, and the execution of said Indenture, have
happened, exist and have been performed as so required.


                                     A-2-5

<PAGE>

     IN WITNESS WHEREOF, the Issuer has caused this Note to be executed in its
name and on its behalf, all as of the Original Issue Date.

                                        EDUCATION FUNDING CAPITAL TRUST-I

                                        By:   FIFTH THIRD BANK,
                                              as Co-Owner Trustee,

                                        By ____________________________________
                                              Name:
                                              Title:


                                     A-2-6

<PAGE>

                          CERTIFICATE OF AUTHENTICATION

     This Note is one of the Series B-1 Notes designated therein and described
in the within-mentioned Indenture.

                                        FIFTH THIRD BANK, as Indenture Trustee


                                        By:_____________________________________
                                            Authorized Signatory

Authentication Date:

____________________________________


                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
unto __________ (Social Security or other identifying number __________) the
within Note and all rights thereunder and hereby irrevocably appoints __________
attorney to transfer the within Note on the books kept for registration thereof,
with full power of substitution in the premises.

Dated:                                  Signed:

____________________________________    ________________________________________

                                        NOTICE: The signature on this Assignment
                                        must correspond with the name of the
                                        Noteholder as it appears on the face of
                                        the within Note in every particular.

Signature Guaranteed by:

____________________________________
A Member of The New York Stock
Exchange or a State or National Bank


                                      A-2-7

<PAGE>

                                    EXHIBIT B

                 2002-1 SERIES A&B CLOSING CASH FLOW PROJECTIONS

                             See Transcript Item 72


<PAGE>

                                    EXHIBIT C

                            NOTICE OF PAYMENT DEFAULT

                        EDUCATION FUNDING CAPITAL TRUST-I
                    AUCTION RATE EDUCATION LOAN BACKED NOTES
                                    SERIES __

     NOTICE IS HEREBY GIVEN that a Payment Default has occurred and is
continuing with respect to the Auction Rate Notes identified above. The next
Auction for the Auction Rate Notes will not be held. The Auction Rate for the
Auction Rate Notes for the next succeeding Interest Period shall be the
Non-Payment Rate.

                                        FIFTH THIRD BANK, as Indenture Trustee


Dated: ________________________         By: ___________________________________


<PAGE>

                                    EXHIBIT D

                        NOTICE OF CURE OF PAYMENT DEFAULT

                        EDUCATION FUNDING CAPITAL TRUST-I
                    AUCTION RATE EDUCATION LOAN BACKED NOTES
                                    SERIES __

     NOTICE IS HEREBY GIVEN that a Payment Default with respect to the Auction
Rate Notes identified above has been waived or cured. The next Payment Date is
__________________________ and the Auction Date is __________________________.

                                        FIFTH THIRD BANK, as Indenture Trustee


Dated: ________________________         By: ___________________________________


<PAGE>

                                    EXHIBIT E

                       NOTICE OF PROPOSED CHANGE IN LENGTH
                         OF ONE OR MORE AUCTION PERIODS

                        EDUCATION FUNDING CAPITAL TRUST-I
                    AUCTION RATE EDUCATION LOAN BACKED NOTES
                                    SERIES __

     Notice is hereby given that the Issuer proposes to change the length of one
or more Auction Periods pursuant to the Indenture as follows:

     1.   The change shall take effect on _______________, the Interest Rate
Adjustment Date for the next Auction Period (the "Effective Date").

     2.   The Auction Period Adjustment in Paragraph 1 shall take place only if
(a) the Indenture Trustee and the Auction Agent receive, by 11:00 a.m., eastern
time, on the Business Day before the Auction Date for the Auction Period
commencing on the Effective Date, a certificate from the Issuer, as required by
the Indenture authorizing the change in length of one or more Auction Periods
and (b) Sufficient Bids exist on the Auction Date for the Auction Period
commencing on the Effective Date.

     3.   If the condition referred to in (a) above is not met, the Auction Rate
for the Auction Period commencing on the Effective Date will be determined
pursuant to the Auction Procedures and the Auction Period shall be the Auction
Period determined without reference to the proposed change. If the condition
referred to in (a) is met but the condition referred to in (b) above is not met,
the Auction Rate for the Auction Period commencing on the Effective Date shall
be the Maximum Rate and the Auction Period shall be the Auction Period
determined without reference to the proposed change.

     4.   It is hereby represented, upon advice of the Auction Agent for the
Series __ Notes described herein, that there were Sufficient Bids for such
Series __ Notes at the Auction immediately preceding the date of this Notice.

     5.   Terms not defined in this Notice shall have the meanings set forth in
the Indenture entered into in connection with the Series __ Notes.

                                        EDUCATION FUNDING CAPITAL TRUST-I


Dated: ____________________             By: ______________________________


<PAGE>

                                    EXHIBIT F

                      NOTICE ESTABLISHING CHANGE IN LENGTH
                         OF ONE OR MORE AUCTION PERIODS

                        EDUCATION FUNDING CAPITAL TRUST-I
                    AUCTION RATE EDUCATION LOAN BACKED NOTES
                                    SERIES __

     Notice is hereby given that the Issuer hereby establishes new lengths for
one or more Auction Periods pursuant to the Indenture:

     1.   The change shall take effect on _______________, the Interest Rate
Adjustment Date for the next Auction Period (the "Effective Date").

     2.   For the Auction Period commencing on the Effective Date, the Interest
Rate Adjustment Date shall be _______________, or the next succeeding Business
Day if such date is not a Business Day.

     3.   For Auction Periods occurring after the Auction Period commencing on
the Effective Date, the Interest Rate Adjustment Date shall be
[_______________(date) and every ______________(number) ______________(day of
week) thereafter] [every ______________(number) ______________(day of week)
after the date set forth in paragraph 2 above], or the next Business Day if any
such day is not a Business Day; provided, however, that the length of subsequent
Auction Periods shall be subject to further change hereafter as provided in the
Indenture.

     4.   The changes described in paragraphs 2 and 3 above shall take place
only upon delivery of this Notice and the satisfaction of other conditions set
forth in the Indenture and our prior notice dated _______________ regarding the
proposed change.

     5.   Terms not defined in this Notice shall have the meanings set forth in
the Indenture relating to the Series __ Notes.


                                        EDUCATION FUNDING CAPITAL TRUST-I


Dated: ____________________             By: ______________________________


<PAGE>

                                    EXHIBIT G

                        NOTICE OF CHANGE IN AUCTION DATE

                        EDUCATION FUNDING CAPITAL TRUST-I
                    AUCTION RATE EDUCATION LOAN BACKED NOTES
                                    SERIES __

     Notice is hereby given by William R. Hough & Co., as Broker-Dealer for the
Auction Rate Notes, that with respect to the Auction Rate Notes, the Auction
Date is hereby changed as follows:

     1.   With respect to Series __ Notes, the definition of "Auction Date"
shall be deemed amended by substituting "_______________(number) Business Day"
in the second line thereof and by substituting "_______________(number) Business
Days" for "two Business Days" in subsection (d) thereof.

     2.   This change shall take effect on _______________ which shall be the
Auction Date for the Auction Period commencing on _______________.

     3.   The Auction Date for the Series __ Notes shall be subject to further
change hereafter as provided in the Indenture.

     4.   Terms not defined in this Notice shall have the meaning set forth in
the Indenture relating to the Series __ Notes.

                                        William R. Hough & Co., as Broker-Dealer


Dated:________________________          By:_____________________________________

<PAGE>

================================================================================

                                2002-2 Series A&B
                         Supplemental Indenture of Trust

                                 by and between

                        Education Funding Capital Trust-I

                                       and

                                Fifth Third Bank,
                              as Indenture Trustee

                                       and

                                Fifth Third Bank,
                        as Trust Eligible Lender Trustee


                           Authorizing the Issuance of

                                  $500,000,000
                        Education Funding Capital Trust-I
                    Auction Rate Education Loan Backed Notes
                                2002-2 Series A&B

                           Dated as of August 1, 2002


================================================================================

<PAGE>

                                Table of Contents

                                    Article I

                         Definitions and Use of Phrases

                                   Article II

                         2002-2 Series A&B Note Details,
                        Form of 2002-2 Series A&B Notes,
                      Redemption of 2002-2 Series A&B Notes
                 and Use of Proceeds of 2002-2 Series A&B Notes

<TABLE>
<S>                                                                               <C>
Section 2.01    2002-2 Series A&B Note Details ...................................
Section 2.02    Redemption of the 2002-2 Series A&B Notes ........................
Section 2.03    Delivery of 2002-2 Series A&B Notes ..............................
Section 2.04    Trustee's Authentication Certificate .............................
Section 2.05    Deposit of 2002-2 Series A&B Note Proceeds .......................
Section 2.06    Excess Reserve Fund Amounts ......................................
Section 2.07    Forms of 2002-2 Series A&B Notes .................................
Section 2.08    Regarding Acquisition Fund .......................................

                                   Article III

                               General Provisions

Section 3.01    Date of Execution ................................................
Section 3.02    Laws Governing ...................................................
Section 3.03    Severability .....................................................
Section 3.04    Exhibits and Appendices ..........................................

                                   Article IV

                     Amendment and Ratification of Indenture

Section 4.01    Amendment of Appendix A of Indenture .............................
Section 4.02    Amendment and Restatement of Section 4.01(a) of Indenture ........
Section 4.03    Amendment and Restatement of Section 4.03(b)(ix) of Indenture ....
Section 4.04    Amendment and Restatement of Section 7.01(n) of Indenture ........
Section 4.05    Ratification of Indenture ........................................
</TABLE>

Appendix A      Certain Terms and Provisions of the Auction Rate Notes
Exhibit A-1     Form of Series A Notes
Exhibit A-2     Form of Series B Notes
Exhibit B       2002-2 Series A&B Closing Cash Flow Projections
Exhibit C       Notice of Payment Default


                                       i

<PAGE>

Exhibit D    Notice of Cure of Payment Default
Exhibit E    Notice of Proposed Change In Length of One or More Auction Periods
Exhibit F    Notice Establishing Change in Length of One or More Auction Periods
Exhibit G    Notice of Change in Auction Date


                                       ii

<PAGE>

                2002-2 Series A&B Supplemental Indenture of Trust

     This 2002-2 Series A&B Supplemental Indenture of Trust (this "Supplemental
Indenture") dated as of August 1, 2002 is by and between Education Funding
Capital Trust-I, a Delaware business trust (the "Issuer"), Fifth Third Bank, a
banking corporation organized under the laws of the State of Ohio, as indenture
trustee (the "Indenture Trustee"), and Fifth Third Bank, a banking corporation
organized under the laws of the State of Ohio, as Trust Eligible Lender Trustee
(the "Trust Eligible Lender Trustee"). All capitalized terms used in these
preambles, recitals and granting clauses shall have the same meanings assigned
thereto in Article I hereof.

                              W I T N E S S E T H:

     Whereas, the Issuer has previously entered into an Indenture of Trust dated
as of May 1, 2002 (the "Indenture") among the Issuer, the Indenture Trustee and
the Trust Eligible Lender Trustee;

     Whereas, the Issuer desires to enter into this Supplemental Indenture to
issue Notes pursuant to the terms of the Indenture, including Section 1.08
thereof, and to amend and restate in its entirety Section 4.03(b)(ix) of the
Indenture;

     Whereas, the Issuer represents that it is duly created as a business trust
under the laws of the State of Delaware and that by proper action it has duly
authorized the issuance of $500,000,000 of its Auction Rate Education Loan
Backed Notes, 2002-2 Series A&B, consisting of six classes designated as 2002-2
Series A (the "Series A Notes") and one class designated as 2002-2 Series B (the
"Series B Notes" and together with the Series A Notes, the "2002-2 Series A&B
Notes"), and it has by proper action authorized the execution and delivery of
this Supplemental Indenture;

     Whereas, the 2002-2 Series A&B Notes constitute Notes as defined in the
Indenture; and

     Whereas, the Indenture Trustee has agreed to accept the trusts herein
created upon the terms herein set forth;

     Now, Therefore, it is mutually covenanted and agreed as follows:

                                    Article I

                         Definitions and Use of Phrases

     All words and phrases defined in Appendix A of the Indenture shall have the
same meaning in this Supplemental Indenture, except as otherwise appears in this
Article. In addition, the following terms have the following meanings in this
Supplemental Indenture unless the context clearly requires otherwise:

<PAGE>

     "Authorized Denominations" shall mean $50,000 and any integral multiple
thereof for the 2002-2 Series A&B Notes.

     "Date of Issuance" shall mean, with respect to the 2002-2 Series A&B Notes,
August 16, 2002.

     "Initial Purchasers" shall mean William R. Hough & Co. and Salomon Smith
Barney Inc.

     "Rating Agency" shall mean, collectively, Fitch, Moody's, and S&P.

     "Record Date" shall mean, with respect to each Payment Date, the Business
Day immediately proceeding such Payment Date.

     "Required Parity Percentage" shall mean 100.5% so long as any 2002-2 Series
A&B Notes are Outstanding; provided, however, that the Required Parity
Percentage may be reduced upon receipt of a Rating Confirmation.

     "Required Senior Parity Percentage" shall mean 105% so long as any 2002-2
Series A&B Notes are Outstanding; provided, however, that the Required Senior
Parity Percentage may be reduced upon receipt of a Rating Confirmation.

     "Reserve Fund Requirement" shall mean 0.5% of the 2002-2 Series A&B Notes
Outstanding; provided, however, that so long as any Series A Notes or Series B
Notes remain Outstanding there shall be at least $600,000 on deposit in the
Reserve Fund. Further, such percentages and amounts may be changed upon
satisfaction of the Rating Agency Condition.

     "S&P" shall mean Standard & Poor's, a division of the McGraw-Hill
Companies.

     "Series A Notes" shall mean, collectively, the Series A-8 Notes, the Series
A-9 Notes, the Series A-10 Notes, the Series A-11 Notes, the Series A-12 Notes,
and the Series A-13 Notes, which Series A Notes are designated as "Senior Notes"
for all purposes of the Indenture.

     "Series A-8 Notes" shall mean the $78,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-8.

     "Series A-9 Notes" shall mean the $78,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-9.

     "Series A-10 Notes" shall mean the $78,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-10.

     "Series A-11 Notes" shall mean the $78,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-11.

     "Series A-12 Notes" shall mean the $78,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-12.


                                       2

<PAGE>

     "Series A-13 Notes" shall mean the $78,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 A-13.

     "Series B Notes" shall mean the $32,000,000 Education Funding Capital
Trust-I, Auction Rate Education Loan Backed Notes, Series 2002 B-2, which Series
B Notes are designated as "Subordinate Notes" for all purposes of the Indenture.

     "Servicing Agreement" shall mean, collectively, (i) the Servicing Agreement
dated as of May 1, 2002, as supplemented and amended from time to time, between
the Issuer and the Servicer, and (ii) the Subservicing Agreement.

     "Subservicer" shall mean Great Lakes Educational Loan Services, Inc., its
successors and assigns and, subject to the Rating Agency Condition, any other
subservicer designated pursuant to the Servicing Agreement.

     "Subservicing Agreement" shall mean the Subservicing Agreement dated as of
May 1, 2002, as supplemented and amended from time to time, between the Servicer
and the Subservicer and, subject to the Rating Agency Condition, any other
subservicer designated pursuant to the Servicing Agreement.

     "2002-2 Series A&B Notes" shall mean the Education Funding Capital Trust-I,
Auction Rate Education Loan Backed Notes, 2002-2 Series A&B issued pursuant to
this Supplemental Indenture in the aggregate principal amount of $500,000,000.

     Words importing the masculine gender include the feminine gender. Words
importing persons include firms, associations and corporations. Words importing
the singular number include the plural number and vice versa. Additional terms
are defined in the body of this Supplemental Indenture and the Appendices
hereto.

     In the event that any term or provision contained herein with respect to
the 2002-2 Series A&B Notes shall conflict with or be inconsistent with any term
or provision contained in the Indenture, the terms and provisions of this
Supplemental Indenture shall govern.

                                   Article II

                         2002-2 Series A&B Note Details,
                        Form of 2002-2 Series A&B Notes,
                      Redemption of 2002-2 Series A&B Notes
                 and Use of Proceeds of 2002-2 Series A&B Notes

     Section 2.01 2002-2 Series A&B Note Details. The aggregate principal amount
of the 2002-2 Series A&B Notes that may be initially authenticated and delivered
under this Supplemental Indenture is limited to, and shall be individually
issued in seven (7) separate series consisting of $78,000,000 of Series A-8
Notes, $78,000,000 of Series A-9 Notes, $78,000,000 of Series A-10 Notes,
$78,000,000 of Series A-11 Notes, $78,000,000 of Series A-12 Notes,


                                        3

<PAGE>

$78,000,000 of Series A-13 Notes, and $32,000,000 of Series B Notes, except for
2002-2 Series A&B Notes authenticated and delivered upon transfer of, or in
exchange for, or in lieu of Notes pursuant to Section 1.03 of the Indenture. The
2002-2 Series A&B Notes shall be issuable only as fully registered notes in the
Authorized Denominations. The Series A Notes shall be designated "Series 2002
A-8", "Series 2002 A-9", "Series 2002 A-10", "Series 2002 A-11", "Series 2002
A-12", and "Series 2002 A-13" and the Notes of each Series shall be numbered
separately from 1 upwards. The Series B Notes shall be designated "Series 2002
B-2" and shall be numbered separately from 1 upwards.

     The 2002-2 Series A&B Notes (collectively, the "Auction Rate Notes") shall
be dated their Date of Issuance and shall bear interest from their Date of
Issuance, payable on each Payment Date (as defined in Appendix A to this
Supplemental Indenture), except that Auction Rate Notes that are issued upon
transfer, exchange or other replacement shall bear interest from the most recent
Payment Date to which interest has been paid, or if no interest has been paid,
from the date of the Auction Rate Notes. The 2002-2 Series A&B Notes shall
mature on June 1, 2042. Interest on the Auction Rate Notes shall be computed on
the basis of a 360-day year and actual days elapsed. The terms of and
definitions related to the Auction Rate Notes are found in Article I hereof and
Appendix A to this Supplemental Indenture. No premium payments shall be paid on
the 2002-2 Series A&B Notes issued under this Supplemental Indenture.

     The principal of the 2002-2 Series A&B Notes due at its Stated Maturity or
redemption in whole shall be payable at the Corporate Trust Office of the
Indenture Trustee, or such other location as directed by the Indenture Trustee,
or at the principal office of its successor in trust upon presentation and
surrender of the 2002-2 Series A&B Notes. Payment of interest and principal paid
subject to a redemption on any 2002-2 Series A&B Note shall be made to the
Noteholder thereof by check or draft mailed on the Payment Date by the Indenture
Trustee to the Noteholder at his address as it last appears on the registration
books kept by the Indenture Trustee at the close of business on the Record Date
for such Payment Date, but any such interest not so timely paid or duly provided
for shall cease to be payable to the Noteholder thereof at the close of business
on the Record Date and shall be payable to the Noteholder thereof at the close
of business on a special record date (a "Special Record Date") for the payment
of any such defaulted interest. Such Special Record Date shall be fixed by the
Indenture Trustee whenever moneys become available for payment of the defaulted
interest, and notice of such Special Record Date shall be given to the
Noteholders of the 2002-2 Series A&B Notes not less than ten (10) days prior
thereto by first-class mail to each such Noteholder as shown on the Indenture
Trustee's registration books on the date selected by the Indenture Trustee,
stating the date of the Special Record Date and the date fixed for the payment
of such defaulted interest. Payment of interest to the Securities Depository or
its nominee shall, and at the written request addressed to the Indenture Trustee
of any other Noteholder owning at least $1,000,000 principal amount of the
2002-2 Series A&B Notes, payments of interest shall, be paid by wire transfer
within the United States to the bank account number filed no later than the
Record Date or Special Record Date with the Indenture Trustee for such purpose.
All payments on the 2002-2 Series A&B Notes shall be made in lawful money of the
United States of America.

     (a)  Except as otherwise provided in this Section, the Series A-8 Notes,
Series A-9 Notes, Series A-10 Notes, Series A-11 Notes, Series A-12 Notes,
Series A-13 Notes and Series B


                                        4

<PAGE>

Notes in the form of one global note for each Series shall be registered in the
name of the Securities Depository or its nominee and ownership thereof shall be
maintained in book-entry form by the Securities Depository for the account of
the Agent Members. Initially, each Series A Note and Series B Note shall be
registered in the name of CEDE & CO., as the nominee of The Depository Trust
Company. Except as provided in subsection (d) of this Section, the Series A
Notes and Series B Notes may be transferred, in whole but not in part, only to
the Securities Depository or a nominee of the Securities Depository or to a
successor Securities Depository selected or approved by the Issuer or to a
nominee of such successor Securities Depository. Each global note shall bear a
legend substantially to the following effect: "Except as otherwise provided in
the Indenture, this global note may be transferred, in whole but not in part,
only to another nominee of the Securities Depository (as defined in the
Indenture) or to a successor Securities Depository or to a nominee of a
successor Securities Depository."

     (b)  Except as otherwise provided herein, the Issuer and the Indenture
Trustee shall have no responsibility or obligation with respect to (i) the
accuracy of the records of the Securities Depository or any Agent Member with
respect to any beneficial ownership interest in the Series A Notes and Series B
Notes, (ii) the delivery to any Agent Member, beneficial owner of the Series A
Notes and Series B Notes or other Person, other than the Securities Depository,
of any notice with respect to the Series A Notes and Series B Notes or (iii) the
payment to any Agent Member, beneficial owner of the Series A Notes and Series B
Notes or other Person, other than the Securities Depository, of any amount with
respect to the principal of or interest on the Series A Notes and Series B
Notes. So long as the certificates for the Series A Notes and Series B Notes
issued under this Supplemental Indenture are not issued pursuant to subsection
(c) of this Section the Issuer and the Indenture Trustee may treat the
Securities Depository as, and deem the Securities Depository to be, the absolute
owner of the Series A Notes and Series B Notes for all purposes whatsoever,
including, without limitation, (A) the payment of principal of and interest on
such Series A Notes and Series B Notes, (B) giving notices of redemption and
other matters with respect to such Series A Notes and Series B Notes and (C)
registering transfers with respect to such Series A Notes and Series B Notes. In
connection with any notice or other communication to be provided to the
Noteholders pursuant to this Supplemental Indenture by the Issuer or the
Indenture Trustee with respect to any consent or other action to be taken by the
Noteholders, the Issuer or the Indenture Trustee, as the case may be, shall
establish a record date for such consent or other action and, if the Securities
Depository shall hold all of the Series A Notes and Series B Notes, give the
Securities Depository notice of such record date not less than 15 calendar days
in advance of such record date to the extent possible. Such notice to the
Securities Depository shall be given only when the Securities Depository is the
sole Noteholder.

     (c)  If at any time the Securities Depository notifies the Issuer and the
Indenture Trustee that it is unwilling or unable to continue as Securities
Depository with respect to any or all of the Series A Notes and Series B Notes
or if at any time the Securities Depository shall no longer be registered or in
good standing under the Securities Exchange Act or other applicable statute or
regulation and a successor Securities Depository is not appointed by the Issuer
within 90 days after the Issuer receives notice or becomes aware of such
condition, as the case may be, subsections (a) and (b) of this Section shall no
longer be applicable and the Issuer shall execute and the Indenture Trustee
shall authenticate and deliver certificates representing the Series A Notes and
Series B Notes as provided below. In addition, the Issuer may determine at any
time that the Series A Notes


                                        5

<PAGE>

and Series B Notes shall no longer be represented by global certificates and
that the provisions of subsections (a) and (b) of this Section shall no longer
apply to the Series A Notes and Series B Notes. In such event, the Issuer shall
execute and the Indenture Trustee shall authenticate and deliver certificates
representing the Series A Notes and Series B Notes as provided below.
Certificates for the Series A Notes and Series B Notes issued in exchange for a
global certificate pursuant to this subsection shall be registered in such names
and authorized denominations as the Securities Depository, pursuant to
instructions from the Agent Members or otherwise, shall instruct in writing to
the Issuer and the Indenture Trustee, and upon which written instructions the
Indenture Trustee may rely without investigation. The Indenture Trustee shall
promptly deliver such certificates representing the Series A Notes and Series B
Notes to the Persons in whose names such Notes are so registered.

     Section 2.02 Redemption of the 2002-2 Series A&B Notes.

     (a)  Mandatory Redemption. If on any Determination Date the Parity
Percentage is not equal to at least the Required Parity Percentage, the 2002-2
Series A&B Notes are subject to mandatory redemption, in whole or in part, on
any interest Payment Date from Revenues on deposit in the Principal Fund;
provided, however, that during any Revolving Period, upon Issuer Order, after
any transfer to the Operating Fund in respect of Program Expenses and after the
transfers required by Sections 4.03(b)(i) through (v) of the Indenture, moneys
remaining on deposit in the Revenue Fund shall be transferred to the Acquisition
Fund and used for the acquisition or origination of other Student Loans.

     The 2002-2 Series A&B Notes are also subject to mandatory redemption, in
whole or in part, on any interest Payment Date, from Revenues representing
Recoveries of Principal on deposit in the Principal Fund or from Revenues
transferred to the Principal Fund pursuant to Section 4.03(b)(ix) of the
Indenture. Series B Notes shall be redeemed only to the extent that after such
payment the Senior Parity Percentage shall not be less than the Required Senior
Parity Percentage.

     (b)  Optional Redemption of 2002-2 Series A&B Notes. The 2002-2 Series A&B
Notes are subject to redemption, in whole or in part, at the option of the
Issuer on any regularly scheduled interest Payment Date. Carryover amounts and
interest on the carryover amounts will be paid prior to any optional redemption
of 2002-2 Series A&B Notes. To the extent funds are available in the Interest
Fund to pay carryover amounts and interest on carryover amounts on any Payment
Date, such funds will be allocated first to pay carryover amounts and interest
on carryover amounts on 2002-2 Series A&B Notes subject to mandatory redemption
on such Payment Date. Any carryover amount and interest on the carryover amount
not paid on the date a 2002-2 Series A&B Note is redeemed pursuant to mandatory
redemption will be cancelled and not paid on that Note on any subsequent date.

     (c)  Redemption Price. Any 2002-2 Series A&B Notes redeemed pursuant to
Section 2.02(a) or (b) hereof shall be redeemed at a price equal to the
principal balance of such Notes plus accrued interest to the date of redemption.

     (d)  Limitation of Redemption of Series B Notes. The Series B Notes that
are otherwise subject to optional or mandatory redemption shall be redeemed only
if, as of the date of selection


                                        6

<PAGE>

of Series B Notes for redemption and after giving effect to such redemption, the
Senior Parity Percentage will be equal to at least the Required Senior Parity
Percentage, and the Parity Percentage will be equal to at least the Required
Parity Percentage.

     (e)  Redemption of Additional Series of Notes. The Issuer shall determine
in a Supplemental Indenture the redemption provisions applicable to additional
series of notes issued under such Supplemental Indenture. The Issuer may
determine to redeem such additional series of notes before redeeming the 2002-2
Series A&B Notes.

     (f)  Notice of Redemption. The Indenture Trustee shall cause notice of any
redemption to be given by mailing a copy of the notice by first-class mail to
the Auction Agent and the Noteholder of any 2002-2 Series A&B Notes designated
for redemption in whole or in part, at their address as the same shall last
appear upon the registration books, in each case not less than 12 days prior to
the redemption date; provided, however, that failure to give such notice, or any
defect therein, shall not affect the validity of any proceedings for the
redemption of such 2002-2 Series A&B Notes for which no such failure or defect
occurs.

     (g)  Partial Redemption. If less than all of the 2002-2 Series A&B Notes
are to be redeemed or purchased pursuant to Section 2.02(a) or (b) hereof, the
Series of Notes to be redeemed shall be determined by the Issuer; provided,
however, in the absence of any direction by the Issuer, the Series of Notes to
be redeemed shall be selected first from the Series B Notes to the extent
permitted hereby and, thereafter, in descending numerical order of the series
designation (beginning with the Series A-13 Notes); provided, however, that the
Issuer shall not direct the Indenture Trustee to redeem any Series of Notes
prior to the expiration of the Initial Period (as defined in Appendix A to this
Supplemental Indenture) applicable to that Series. If less than all Outstanding
Notes of any Series of 2002-2 Series A&B Notes are to be redeemed, the
particular Notes of that Series to be redeemed will be determined by lot in such
manner as the Indenture Trustee shall determine. In case a 2002-2 Series A&B
Note is of a denomination larger than an Authorized Denomination, a portion of
such Note (in an Authorized Denomination) may be redeemed. Upon surrender of any
2002-2 Series A&B Note for redemption in part only, the Issuer shall execute and
the Indenture Trustee shall authenticate and deliver to the Noteholder thereof,
the cost of which shall be paid by the Issuer, a new 2002-2 Series A&B Note or
2002-2 Series A&B Notes of the same Series, maturity and of Authorized
Denominations, in an aggregate principal amount equal to the unredeemed portion
of the 2002-2 Series A&B Note surrendered.

     Section 2.03 Delivery of 2002-2 Series A&B Notes. Upon the execution and
delivery of this Supplemental Indenture, the Issuer shall execute and deliver to
the Indenture Trustee and the Indenture Trustee shall authenticate the 2002-2
Series A&B Notes and deliver the 2002-2 Series A&B Notes to The Depository Trust
Company; provided, however, prior to the delivery by the Indenture Trustee of
any of the 2002-2 Series A&B Notes, there shall have been filed with or
delivered to the Indenture Trustee the following:

          (a)  An Issuer Order authorizing the execution and delivery of this
     Supplemental Indenture and the issuance of the 2002-2 Series A&B Notes.


                                        7

<PAGE>

          (b)  Duly executed  copies of this  Supplemental  Indenture and a copy
     of the Indenture.

          (c)  Rating letters from each Rating Agency confirming (i) that the
     Series A Notes have been rated "AAA" by Fitch, "Aaa" by Moody's and "AAA"
     by S&P and (ii) that the Series B Notes have been rated "A" by Fitch, "A3"
     by Moody's and "A" by S&P.

     Section 2.04 Trustee's Authentication Certificate. The Indenture Trustee's
authentication certificate upon the 2002-2 Series A&B Notes shall be
substantially in the forms provided in Exhibits A-1 and A-2. No 2002-2 Series
A&B Note shall be secured hereby or entitled to the benefit hereof, or shall be
valid or obligatory for any purpose, unless a certificate of authentication,
substantially in such form, has been duly executed by the Indenture Trustee at
the written direction of the Issuer; and such certificate of the Indenture
Trustee upon any 2002-2 Series A&B Note shall be conclusive evidence and the
only competent evidence that such Note has been authenticated and delivered
hereunder. The Indenture Trustee's certificate of authentication shall be deemed
to have been duly executed by it if manually signed by an authorized officer of
the Indenture Trustee, but it shall not be necessary that the same person sign
the certificate of authentication on all of the 2002-2 Series A&B Notes issued
hereunder.

     Section 2.05 Deposit of 2002-2 Series A&B Note Proceeds. Upon the issuance
and delivery of the 2002-2 Series A&B Notes, the Indenture Trustee shall deposit
the net proceeds thereof (i.e., net of Initial Purchasers' discount of
$1,500,000):

     (a)  an amount equal to $485,750,000 shall be deposited to the Acquisition
          Fund;

     (b)  an amount equal to $2,500,000 shall be deposited to the Reserve Fund;
          and

     (c)  an amount equal to $10,250,000 shall be deposited to the Capitalized
          Interest Fund.

     Section 2.06 Excess Reserve Fund Amounts.

     On any date on which the amount on deposit in the Reserve Fund exceeds the
Reserve Fund Requirement, the Indenture Trustee, at the direction of the
Administrator, shall transfer such excess from the Reserve Fund to the Revenue
Fund for application on the next Payment Date.

     Section 2.07 Forms of 2002-2 Series A&B Notes. The 2002-2 Series A&B Notes
shall be in substantially the form set forth in Exhibits A-1 and A-2 hereto,
each with such variations, omissions and insertions as may be necessary.

     Section 2.08 Regarding Acquisition Fund. The Indenture Trustee shall
transfer to the Revenue Fund all moneys remaining in the Acquisition Fund
immediately after December 31, 2002; provided, however, that the transfer of
such moneys may be delayed upon receipt of a Rating Confirmation with respect to
such delay. Student Loans purchased with moneys in the Acquisition Fund after
the Date of Issuance shall only be used to acquire Federal Consolidation Loans
originated after January 1, 2000 with characteristics similar to the Student
Loans currently in the


                                        8

<PAGE>

Trust Estate, with the underlying Stafford Loans being consolidated into
Consolidation Loans being no less than 40% Subsidized Stafford Loans.

                                   Article III

                               General Provisions

     Section 3.01 Date of Execution. This Supplemental Indenture for convenience
and for the purpose of reference is dated as of August 1, 2002.

     Section 3.02 Laws Governing. It is the intent of the parties hereto that
this Supplemental Indenture shall in all respects be governed by the laws of the
State of Ohio.

     Section 3.03 Severability. If any covenant, agreement, waiver, or part
thereof in this Supplemental Indenture contained be forbidden by any pertinent
law or under any pertinent law be effective to render this Supplemental
Indenture invalid or unenforceable or to impair the lien hereof, then each such
covenant, agreement, waiver, or part thereof shall itself be and is hereby
declared to be wholly ineffective, and this Supplemental Indenture shall be
construed as if the same were not included herein.

     Section 3.04 Exhibits and Appendices. The terms of each Exhibit and
Appendix attached to this Supplemental Indenture are incorporated herein in all
particulars.

                                   Article IV

                     Amendment and Ratification of Indenture

     Section 4.01 Amendment of Appendix A of Indenture.

     (a)  Each of the following defined terms contained in Appendix A of the
Indenture is hereby amended and restated in its entirety to read as follows:

            "Eligible Deposit Account" shall mean either (a) a segregated
            account with a depository institution organized under the laws of
            the United States of America or any one of the states thereof or the
            District of Columbia (or any domestic branch of a foreign bank) that
            has a rating of A-1+ from S&P and either a long-term unsecured debt
            rating of A2 by Moody's and AA by Fitch or a short-term unsecured
            debt rating of Prime-1 by Moody's and F2 by Fitch, and whose
            deposits are insured by the Federal Deposit Insurance Corporation;
            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 thereof or the
            District of Columbia (or any domestic branch of a foreign bank)
            having corporate trust powers and acting as trustee for funds
            deposited in the account, so long as any unsecured notes of the
            depository institution have an investment grade credit rating from
            each Rating Agency.


                                        9

<PAGE>

            "Eligible Investments" shall mean book-entry securities, negotiable
            instruments or securities denominated in United States dollars and
            represented by instruments in bearer or registered form that
            evidence:

                    (a)  direct obligations of, and obligations fully guaranteed
               as to timely payment by, the United States of America;

                    (b)  demand deposits, time deposits or certificates of
               deposit of any depository institution or trust company
               incorporated under the laws of the United States of America or
               any State (or any domestic branch of a foreign bank) and subject
               to supervision and examination by federal or state banking or
               depository institution authorities (including depository receipts
               issued by any such institution or trust company as custodian with
               respect to any obligation referred to in clause (a) above or
               portion of such obligation for the benefit of the holders of such
               depository receipts); provided, however, that at the time of the
               investment or contractual commitment to invest therein (which
               shall be deemed to be made again each time funds are reinvested
               following each Payment Date), the commercial paper or other
               short-term senior unsecured debt obligations (other than such
               obligations the rating of which is based on the credit of a
               Person other than such depository institution or trust company)
               thereof shall have a rating of A-1+ from S&P and a credit rating
               from each of the other Rating Agencies in the highest short-term
               and long-term investment category granted thereby;

                    (c)  commercial paper having, at the time of the investment
               or contractual commitment to invest therein, a rating of A-1+
               from S&P and a rating from each of the other Rating Agencies in
               the highest short-term investment category granted thereby, and,
               if the commercial paper matures in more than 30 days, the issuer
               of which commercial paper having a long-term unsecured debt
               rating from Moody's of A1 (for commercial paper maturing in 31 to
               90 days), Aa3 (for commercial paper maturing in 91 to 180 days),
               or Aaa (for commercial paper maturing in more than 180 days);

                    (d)  investments in money market funds having a rating of
               A-1+ from S&P and a rating from each of the other Rating Agencies
               rating such fund, in the highest investment category granted by
               such Rating Agency applicable to money market funds (including
               funds for which the Indenture Trustee, the Servicer or the Trust
               Eligible Lender Trustee or any of their respective Affiliates is
               investment manager or advisor);

                    (e)  bankers' acceptances issued by any depository
               institution or trust company referred to in clause (b) above;

                    (f)  repurchase obligations with respect to any security
               that is a direct obligation of, or fully guaranteed by, the
               United States of America or


                                       10

<PAGE>

               any agency or instrumentality thereof the obligations of which
               are backed by the full faith and credit of the United States of
               America, in either case entered into with a depository
               institution or trust company (acting as principal) described in
               clause (b) above;

                    (g)  any other investment upon receipt of a Rating
               Confirmation or any other investment made in connection with the
               original issuance of Notes in respect of which issuance a Rating
               Confirmation has been obtained.

          No obligation having an "r" highlighter affixed to its rating shall be
          considered an Eligible Investment. Eligible Investments shall not
          include interest-only securities or securities purchased at a premium
          over par.

          "Eligible Lender Trust Agreements" shall mean collectively the Seller
          Eligible Lender Trust Agreement, the Depositor Eligible Lender Trust
          Agreement and the Trust Eligible Lender Trust Agreement.

          "Rating" shall mean one of the rating categories of Fitch, Moody's and
          S&P or any other Rating Agency, provided Fitch, Moody's and S&P or any
          other Rating Agency, as the case may be, is currently rating the
          Notes.

          "Rating Agency" shall mean Fitch, Moody's and S&P. 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 Seller, notice of which
          designation shall be given to the Indenture Trustee, the Trust
          Eligible Lender Trustee and the Servicer.

          "Revolving Period" shall mean the period commencing on August 16, 2002
          and terminating on December 31, 2002, or on such other date as
          determined by the Issuer upon receipt of a Rating Confirmation.

          "Trust Accounts" shall have the meaning given such term in Section
          4.01(a) of the Indenture.

          "Trust Eligible Lender Trustee" shall mean Fifth Third Bank, a banking
          corporation organized under the laws of the State of Ohio, not in its
          individual capacity but solely as Trust Eligible Lender Trustee under
          the Trust Eligible Lender Trust Agreement.

     (b)  The following defined terms are hereby added to Appendix A of the
Indenture:

          "S&P" shall mean Standard & Poor's, a division of the McGraw-Hill
          Companies.


                                       11

<PAGE>

          "Trust Eligible Lender Trust Agreement" shall mean the Eligible Lender
          Trust Agreement dated as of May 1, 2002 between the Issuer and the
          Trust Eligible Lender Trustee.

     (c) The defined term "Co-Owner Eligible Lender Trust Agreement" is hereby
deleted in its entirety from Appendix A of the Indenture:

     Section 4.02 Amendment and Restatement of Section 4.01(a) of Indenture.
Section 4.01(a) of the Indenture is hereby amended and restated in its entirety
to read as follows:

          (a)   There are hereby created and established the following Funds and
     Accounts (collectively, the "Trust Accounts"), which shall be held and
     maintained as trust accounts by the Indenture Trustee for the benefit of
     the Noteholders:

          (i)   Acquisition Fund;

          (ii)  Revenue Fund;

          (iii) Interest Fund (including therein a Class A Account and a Class B
                Account);

          (iv)  Principal Fund (including therein a Class A Account and a Class
                B Account);

          (v)   Reserve Fund; and

          (vi)  Capitalized Interest Fund.

     Section 4.03 Amendment and Restatement of Section 4.03(b)(ix) of Indenture.
Section 4.03(b)(ix) of the Indenture is hereby amended and restated in its
entirety to read as follows:

     (ix) to the Co-Owner Trustee for deposit into the Certificate Distribution
     Account (as defined in the Trust Agreement) if after giving effect to the
     transfer to the Co-Owner Trustee the Parity Percentage is at least equal to
     the Required Parity Percentage and the Senior Parity Percentage is at least
     equal to the Required Senior Parity Percentage; if these parity
     requirements are not met, then any remainder shall be retained in the
     Revenue Fund; provided, however, that during any period commencing after
     June 1, 2017, moneys will be transferred to the Co-Owner Trustee pursuant
     to this subsection (ix) only upon receipt of a Rating Confirmation with
     respect to transfers during that period, otherwise moneys remaining in the
     Revenue Fund after payment of all amounts required by (i) through (viii) of
     this Section 4.03(b) shall be transferred to the Principal Fund.

     Section 4.04 Amendment and Restatement of Section 7.01(n) of Indenture.
Section 7.01(n) of the Indenture is hereby amended and restated in its entirety
to read as follows:

     (n)  to make any other change with Rating Confirmation; or


                                       12

<PAGE>

     Section 4.05 Ratification of Indenture. The provisions of the Indenture are
hereby ratified, approved and confirmed, except as otherwise expressly modified
by this Supplemental Indenture. The representations, warranties and covenants
contained in the Indenture (except as expressly modified herein) are hereby
reaffirmed with the same force and effect as if fully set forth herein and made
again as of the date hereof.

      [remainder of page intentionally left blank; signature page follows]


                                       13

<PAGE>

     In Witness Whereof, the Issuer has caused this Supplemental Indenture to be
executed in its name and on its behalf by the Co-Owner Trustee; the Indenture
Trustee, to evidence its acceptance of the trusts hereby created, has caused
this Supplemental Indenture to be executed in its name and behalf; and the Trust
Eligible Lender Trustee, to evidence its acceptance of the trusts hereby
created, has caused this Supplemental Indenture to be executed in its name and
behalf, all in multiple counterparts, each of which shall be deemed an original,
and the Issuer, the Indenture Trustee and the Trust Eligible Lender Trustee have
caused this Supplemental Indenture to be dated as of the date herein above first
shown, although actually executed on the dates shown in the acknowledgments
hereafter appearing.

                                        Education Funding Capital Trust-I,
                                             By Fifth Third Bank, not in its
                                             individual capacity, but solely as
                                             Co-Owner Trustee on behalf of the
                                             Trust


                                        By: /s/ Brian J. Gardner
                                           -------------------------------------
                                             Name: Brian J. Gardner
                                             Title: AVP & Sr. Trust Officer


                                        Fifth Third Bank, not in its individual
                                             capacity but solely as Indenture
                                             Trustee


                                        By: /s/ Brian J. Gardner
                                           -------------------------------------
                                             Name: Brian J. Gardner
                                             Title: AVP & Sr. Trust Officer


                                        Fifth Third Bank, not in its individual
                                             capacity but solely as Trust
                                             Eligible Lender Trustee


                                        By: /s/ Brian J. Gardner
                                           -------------------------------------
                                             Name: Brian J. Gardner
                                             Title: AVP & Sr. Trust Officer


<PAGE>

                                   Appendix A

                         Certain Terms and Provisions of
                             the Auction Rate Notes

                                    Article I

                                   Definitions

     Except as provided below in this Section, all terms that are defined in
Appendix A of the Indenture and Article I of this Supplemental Indenture shall
have the same meanings, respectively, in this Appendix A as such terms are given
in the Indenture and Article I of this Supplemental Indenture. In addition, the
following terms shall have the following respective meanings:

     "All Hold Rate" shall mean the Applicable LIBOR Rate less .20%; provided,
that in no event shall the applicable All Hold Rate be greater than the
applicable Maximum Rate.

     "Applicable LIBOR Rate" means, (a) for Auction Periods of 35 days or less,
One-Month LIBOR, (b) for Auction Periods of more than 35 days but less than 91
days, Three-Month LIBOR, (c) for Auction Periods of more than 90 days but less
than 181 days, Six-Month LIBOR, and (d) for Auction Periods of more than 180
days, One-Year LIBOR.

     "Auction" shall mean the implementation of the Auction Procedures on an
Auction Date.

     "Auction Agent" shall mean the Initial Auction Agent under the Initial
Auction Agent Agreement unless and until a Substitute Auction Agent Agreement
becomes effective, after which "Auction Agent" shall mean the Substitute Auction
Agent.

     "Auction Agent Agreement" shall mean the Initial Auction Agent Agreement
unless and until a Substitute Auction Agent Agreement is entered into, after
which "Auction Agent Agreement" shall mean such Substitute Auction Agent
Agreement.

     "Auction Agent Fee" has the meaning set forth in the Auction Agent
Agreement.

     "Auction Date" shall mean, initially, September 23, 2002 with respect to
the Series A-8 Notes, October 24, 2002 with respect to the Series A-9 Notes,
September 3, 2002 with respect to the Series A-10 Notes, September 9, 2002 with
respect to the Series A-11 Notes, September 12, 2002 with respect to the Series
A-12 Notes, September 16, 2002 with respect to the Series A-13 Notes, and
September 18, 2002 with respect to the Series B-2 Notes, and thereafter, the
Business Day immediately preceding the first day of each Auction Period for each
respective Series, other than:

     (a)   each Auction Period commencing after the ownership of the applicable
   Auction Rate Notes is no longer maintained in Book-entry Form by the
   Securities Depository;


                                      A-1

<PAGE>

     (b)   each Auction Period commencing after and during the continuance of a
   Payment Default; or

     (c)   each Auction Period commencing less than two Business Days after the
   cure or waiver of a Payment Default.

Notwithstanding the foregoing, the Auction Date for one or more Auction Periods
may be changed pursuant to Section 2.02(h) of this Appendix A.

     "Auction Note Interest Rate" shall mean each variable rate of interest per
annum borne by Auction Rate Notes for each Auction Period and determined in
accordance with the provisions of Sections 2.01 and 2.02 of this Appendix A;
provided, however, that in the event of a Payment Default, the Auction Note
Interest Rate shall equal the applicable Non-Payment Rate; provided further,
however, that such Auction Note Interest Rate shall in no event exceed the
lesser of the Net Loan Rate and the Maximum Rate.

     "Auction Period" shall mean the Interest Period applicable to each Series
of Auction Rate Notes during which time the Auction Note Interest Rate for such
Series is determined pursuant to Section 2.02(a) of this Appendix A, which
Auction Period (after the Initial Period for such Series) shall begin on an
Interest Rate Adjustment Date and initially shall consist generally of 28 days
for the Auction Rate Notes, as the same may be adjusted pursuant to Section
2.02(g) of this Appendix A.

     "Auction Period Adjustment" shall mean an adjustment to the Auction Period
as provided in Section 2.02(g) of this Appendix A.

     "Auction Procedures" shall mean the procedures set forth in Section 2.02(a)
of this Appendix A by which the Auction Rate is determined.

     "Auction Rate" shall mean the rate of interest per annum that results from
implementation of the Auction Procedures and is determined as described in
Section 2.02(a)(iii)(B) of this Appendix A.

     "Auction Rate Notes" shall mean, collectively, the Series A Notes and the
Series B Notes.

     "Authorized Denominations" shall mean $50,000 and any integral multiple
thereof.

     "Available Auction Rate Notes" has the meaning set forth in Section
2.02(a)(iii)(A)(1) of this Appendix A.

     "Bid" has the meaning set forth in Section 2.02(a)(i)(A) of this Appendix
A.

     "Bid Auction Rate" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Bidder" has the meaning set forth in Section 2.02(a)(i)(A) of this
Appendix A.


                                      A-2

<PAGE>

     "Book-entry Form" or "Book-entry System" shall mean a form or system under
which (a) the beneficial right to principal and interest may be transferred only
through a book entry, (b) physical securities in registered form are issued only
to a Securities Depository or its nominee as Noteholder, with the securities
"immobilized" to the custody of the Securities Depository, and (c) the book
entry is the record that identifies the owners of beneficial interests in that
principal and interest.

     "Broker-Dealers" shall mean William R. Hough & Co. (with respect to Series
A-8 Notes, Series A-9 Notes, Series A-10 Notes, Series A-11 Notes and Series B-2
Notes), Salomon Smith Barney Inc. (with respect to Series A-12 Notes and Series
A-13 Notes), and any other broker or dealer (each as defined in the Securities
Exchange Act of 1934, as amended), commercial bank or other entity permitted by
law to perform the functions required of a Broker-Dealer set forth in the
Auction Procedures that (a) is a Participant (or an affiliate of a Participant),
(b) has been appointed as such by the Issuer pursuant to Section 2.02(f) of this
Appendix A, and (c) has entered into a Broker-Dealer Agreement that is in effect
on the date of reference.

     "Broker-Dealer Agreements" shall mean the agreements between the Auction
Agent and the Broker-Dealers, and approved by the Issuer, pursuant to which the
Broker-Dealers agree to participate in Auctions as set forth in the Auction
Procedures, as from time to time amended or supplemented. The Broker-Dealer
Agreements shall be in substantially the form of each Broker-Dealer Agreement
dated as of August 1, 2002, among the Issuer, the Auction Agent, and each
respective Broker-Dealer.

     "Broker-Dealer Fee" has the meaning set forth in the Auction Agent
Agreement.

     "Business Day" shall mean any day other than a Saturday, Sunday, holiday or
day on which banks located in the City of New York, New York, or the New York
Stock Exchange, the Indenture Trustee or the Auction Agent, are authorized or
permitted by law or executive order to close or such other date as may be agreed
to in writing by the Auction Agent, the Broker-Dealers and the Issuer.

     "Cap Rate" shall mean, with respect to any Interest Period applicable to
the Auction Rate Notes, the lesser of (i) the applicable Maximum Rate and (ii)
the Net Loan Rate in effect for such Interest Period.

     "Carry-over Amount" shall mean, for any Interest Period during which
interest is calculated at the Net Loan Rate, the excess, if any, of (a) the
amount of interest on an Auction Rate Note that would have accrued with respect
to the related Interest Period at the lesser of (i) the applicable Auction Rate
and (ii) the Maximum Rate over (b) the amount of interest on such Auction Rate
Note actually accrued with respect to such Auction Rate Note with respect to
such Interest Period based on the Net Loan Rate, together with the unreduced
portion of any such excess from prior Interest Periods; provided that any
reference to "principal" or "interest" in the Indenture and the Auction Rate
Notes shall not include within the meanings of such words any Carry-over Amount
or any interest accrued on any Carry-over Amount.


                                      A-3

<PAGE>

     "Closing Date" shall mean the Date of Issuance of the Auction Rate Notes
(August 16, 2002).

     "Effective Interest Rate" shall mean, with respect to any Financed Student
Loan, the interest rate per annum payable by the borrower as of the last day of
the calendar quarter borne by such Financed Student Loan after giving effect to
any reduction in such interest rate pursuant to borrower incentives, (a) less
all accrued rebate fees on such Financed Student Loan constituting Consolidation
Loans paid during such calendar quarter expressed as a percentage per annum and
(b) plus all accrued Interest Benefit Payments and Special Allowance Payments
applicable to such Financed Student Loan during such calendar quarter expressed
as a percentage per annum.

     "Eligible Carry-over Make-up Amount" shall mean, with respect to each
Interest Period relating to the Auction Rate Notes as to which, as of the first
day of such Interest Period, there is any unpaid Carry-over Amount, an amount
equal to the lesser of (a) interest computed on the principal balance of the
Auction Rate Notes in respect to such Interest Period at a per annum rate equal
to the excess, if any, of the Net Loan Rate over the Auction Rate, together with
the unreduced portion of any such excess from prior Interest Periods and (b) the
aggregate Carry-over Amount remaining unpaid as of the first day of such
Interest Period together with interest accrued and unpaid thereon through the
end of such Interest Period.

     "Existing Owner" shall mean (a) with respect to and for the purpose of
dealing with the Auction Agent in connection with an Auction, a Person who is a
Broker-Dealer listed in the Existing Owner Registry at the close of business on
the Business Day immediately preceding the Auction Date for such Auction and (b)
with respect to and for the purpose of dealing with the Broker-Dealers in
connection with an Auction, a Person who is a beneficial owner of Auction Rate
Notes.

     "Existing Owner Registry" shall mean the registry of Persons who are owners
of the Auction Rate Notes, maintained by the Auction Agent as provided in the
Auction Agent Agreement.

     "Hold Order" has the meaning set forth in Section 2.02(a)(i)(A) of this
Appendix A.

     "Initial Auction Agent" shall mean Deutsche Bank Trust Company Americas, a
New York banking corporation, and its successors and assigns.

     "Initial Auction Agent Agreement" shall mean the Auction Agent Agreement
dated as of August 1, 2002, by and among the Issuer, the Indenture Trustee and
the Initial Auction Agent, including any amendment thereof or supplement
thereto.

     "Initial Payment Dates" shall mean, with respect to the Series A-8 Notes,
September 24, 2002; with respect to the Series A-9 Notes, October 25, 2002; with
respect to the Series A-10 Notes, September 4, 2002; with respect to the Series
A-11 Notes, September 10, 2002; with respect to the Series A-12 Notes, September
13, 2002; with respect to the Series A-13 Notes, September 17, 2002, and with
respect to the Series B-2 Notes, September 19, 2002.


                                      A-4

<PAGE>

     "Initial Period" shall mean, as to Auction Rate Notes, the period
commencing on the Closing Date and continuing through the day immediately
preceding the Initial Rate Adjustment Date for such Auction Rate Notes.

     "Initial Rate" shall mean 1.95% for the Series A-8 Notes, 1.96% for the
Series A-9 Notes, 2.00% for the Series A-10 Notes, 2.00% for the Series A-11
Notes, 1.95% for the Series A-12 Notes, 1.95% for the Series A-13 Notes, and
2.15% for the Series B-2 Notes.

     "Initial Rate Adjustment Date" shall mean, with respect to the Series A-8
Notes, September 24, 2002; with respect to the Series A-9 Notes, October 25,
2002; with respect to the Series A-10 Notes, September 4, 2002; with respect to
the Series A-11 Notes, September 10, 2002; with respect to the Series A-12
Notes, September 13, 2002; with respect to the Series A-13 Notes, September 17,
2002, and with respect to the Series B-2 Notes, September 19, 2002.

     "Interest Period" shall mean, with respect to the Auction Rate Notes, the
Initial Period and each period commencing on an Interest Rate Adjustment Date
for such Series and ending on and including the day before (a) the next Interest
Rate Adjustment Date for such Series or (b) the Stated Maturity of such Series,
as applicable.

     "Interest Rate Adjustment Date" shall mean the date on which an Auction
Note Interest Rate is effective, and shall mean, with respect to the Auction
Rate Notes, the date of commencement of each Auction Period.

     "Interest Rate Determination Date" shall mean, with respect to the Auction
Rate Notes, the Auction Date, or if no Auction Date is applicable to such
Series, the Business Day immediately preceding the date of commencement of an
Auction Period.

     "Market Agent" shall mean William R. Hough & Co.

     "Market Agent Agreement" shall mean the Market Agent Agreement dated as of
August 1, 2002 among the Market Agent, the Issuer and the Indenture Trustee, as
the same may be amended from time to time.

     "Maximum Rate" means the least of (a) either (i) the Applicable LIBOR Rate
plus 1.50% (if the ratings assigned by Fitch, Moody's and S&P to the Auction
Rate Notes are "AAA," "Aaa" and "AAA," respectively, or better) or (ii) the
Applicable LIBOR Rate plus 2.50% (if any one of the ratings assigned by Fitch,
Moody's and S&P to the Auction Rate Notes is less than "AAA," "Aaa" and "AAA,"
respectively, and greater than or equal to "A-," "A3" and "A-," respectively),
or (iii) the Applicable LIBOR Rate plus 3.50% (if any one of the ratings
assigned by Fitch, Moody's and S&P to the Auction Rate Notes is less than "A-,"
"A3" and "A-," respectively), and (b) the highest rate the Issuer may legally
pay, from time to time, as interest on the Auction Rate Notes. For purposes of
the Auction Agent and the Auction Procedures, the ratings referred to in this
definition shall be the last ratings of which the Auction Agent has been given
written notice pursuant to the Auction Agent Agreement.


                                      A-5

<PAGE>

     "Net Loan Rate" shall mean, with respect to any Interest Period applicable
to the Auction Rate Notes, the rate of interest per annum (rounded to the next
highest one-hundredth of one percent) equal to (a) the weighted average
Effective Interest Rate of the Financed Student Loans for the calendar quarter
immediately preceding such Interest Period, as determined by the Administrator
on the last day of such calendar quarter, less (b) the Program Expense
Percentage, as determined by the Administrator on the last day of each calendar
year. In making the determinations in (a) and (b) of this definition of "Net
Loan Rate," the Administrator shall take into account as an increase to such Net
Loan Rate the receipt of any Counterparty Derivative Payment and as a decrease
to such Net Loan Rate any Issuer Derivative Payment. The determinations made by
the Administrator in (a) and (b) of this definition of "Net Loan Rate" shall be
given in writing to the Auction Agent, the Indenture Trustee and the
Broker-Dealers immediately upon their respective calculation dates.

     "Non-Payment Rate" shall mean One-Month LIBOR plus 1.50%.

     "One-Month LIBOR," "Three-Month LIBOR," "Six-Month LIBOR" or "One-Year
LIBOR," shall mean the rate per annum fixed by the British Bankers' Association
at 11:00 a.m., London time (BBA Libor rate), relating to quotations for London
Interbank Offered Rates on U.S. dollar deposits for the Applicable LIBOR Rate,
as determined by the Auction Agent or Indenture Trustee, as applicable. Such
rate may be available on the Internet at www.bba.org.uk. If such a day is not a
business day in London, the most recently fixed London Interbank Offered Rates
on U.S. dollar deposits for the Applicable LIBOR Rate shall be used. If the rate
is no longer available from such source, the Auction Agent or Indenture Trustee,
as applicable, will ascertain the rate in good faith from such sources as it
shall determine to be comparable to such source. All percentages resulting from
such calculations shall be rounded upwards, if necessary, to the nearest
one-hundredth of one percent.

     "Order" has the meaning set forth in Section 2.02(a)(i)(A) of this Appendix
A.

     "Payment Date" shall mean, initially with respect to each series of the
Notes, the applicable Initial Payment Dates and, thereafter (a) so long as a
series of the Notes bears interest at an Auction Note Interest Rate for an
Interest Period of not greater than 180 days, the Business Day immediately
following the expiration of the related Auction Period thereafter and (b) if and
for so long as a series of Notes bears interest at an Auction Note Interest Rate
for an Interest Period of greater than 180 days, the first Business Day of each
June and December.

     "Payment Default" shall mean, with respect to the Auction Rate Notes, (a) a
default in the due and punctual payment of any installment of interest on such
Auction Rate Notes, or (b) a default in the due and punctual payment of any
interest on and principal of such Auction Rate Notes at their maturity.

     "Potential Owner" shall mean any Person (including an Existing Owner that
is (a) a Broker-Dealer when dealing with the Auction Agent and (b) a potential
beneficial owner when dealing with a Broker-Dealer) who may be interested in
acquiring Auction Rate Notes (or, in the case of an Existing Owner thereof, an
additional principal amount of Auction Rate Notes).


                                      A-6

<PAGE>

     "Program Expense Percentage" shall mean, the percentage that all Program
Expenses (other than Consolidation Loan rebate fees) estimated for the next 12
months represent of the principal amount of the Notes, which as of August 16,
2002 is 0.60%, and which the Administrator shall calculate annually on the last
day of each calendar year. Any adjustment in the Program Expense Percentage
shall be effective beginning on the first Interest Rate Determination Date
following each such calculation.

     "Regular Record Date" shall mean, with respect to each Payment Date, the
Business Day immediately preceding such Payment Date.

     "Sell Order" has the meaning set forth in Section 2.02(a)(i)(A) of this
Appendix A.

     "Submission Deadline" shall mean 1:00 p.m., eastern time, on any Auction
Date or such other time on any Auction Date by which the Broker-Dealers are
required to submit Orders to the Auction Agent as specified by the Auction Agent
from time to time.

     "Submitted Bid" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Submitted Hold Order" has the meaning set forth in Section 2.02(a)(iii)(A)
of this Appendix A.

     "Submitted Order" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

     "Submitted Sell Order" has the meaning set forth in Section 2.02(a)(iii)(A)
of this Appendix A.

     "Substitute Auction Agent" shall mean the Person with whom the Issuer and
the Indenture Trustee enter into a Substitute Auction Agent Agreement.

     "Substitute Auction Agent Agreement" shall mean an auction agent agreement
containing terms substantially similar to the terms of the Initial Auction Agent
Agreement, whereby a Person having the qualifications required by Section
2.02(e) of this Appendix A agrees with the Indenture Trustee and the Issuer to
perform the duties of the Auction Agent under this Appendix A.

     "Sufficient Bids" has the meaning set forth in Section 2.02(a)(iii)(A) of
this Appendix A.

                                   Article II

                               Terms and Issuance

     Section 2.01 Auction Rate and Carry-over Amounts. During the Initial
Period, each Series of Auction Rate Notes shall bear interest at the Initial
Rate for such Series. Thereafter, and except with respect to an Auction Period
Adjustment, the Auction Rate Notes shall bear interest at an Auction Note
Interest Rate based on a 28-day Auction Period for the Auction Rate Notes, as
determined pursuant to this Section 2.01 and Section 2.02 of this Appendix A.


                                      A-7

<PAGE>

     For the Auction Rate Notes during the Initial Period and each Auction
Period thereafter, interest at the applicable Auction Note Interest Rate shall
accrue daily and shall be computed for the actual number of days elapsed on the
basis of a year consisting of 360 days.

     The Auction Note Interest Rate to be borne by the Auction Rate Notes after
such Initial Period for each Auction Period until an Auction Period Adjustment,
if any, shall be determined as described below. Each such Auction Period after
the Initial Period shall commence on and include the day following the
expiration of the immediately preceding Auction Period and terminate on and
include (i) the first Business Day of the following fourth week in the case of
the Series A-8 Notes, the Series A-10 Notes, the Series A-11 Notes and the
Series A-13 Notes, (ii) the third Business Day of the following fourth week in
the case of the Series A-12 Notes and the Series B-2 Notes, and (iii) the fourth
Business Day of the following fourth week in the case of the Series A-9 Notes;
provided, however, that in the case of the Auction Period that immediately
follows the Initial Period for the Auction Rate Notes, such Auction Period shall
commence on the Initial Rate Adjustment Date. The Auction Note Interest Rate of
the Auction Rate Notes for each Auction Period shall be the Auction Rate in
effect for such Auction Period as determined in accordance with Section 2.02(a)
of this Appendix A; provided that, if on any Interest Rate Determination Date,
an Auction is not held for any reason, the following Business Day shall be
considered the Interest Rate Determination Date and an Auction is to be held on
such date. If an Auction is not held for any reason on such date, then the
Auction Note Interest Rate on such Auction Rate Notes for the next succeeding
Auction Period shall be the applicable Cap Rate.

     Notwithstanding the foregoing:

          (a) if the ownership of an Auction Rate Note is no longer maintained
     in Book-entry Form, the Auction Note Interest Rate on the Auction Rate
     Notes for any Interest Period commencing after the delivery of certificates
     representing Auction Rate Notes pursuant to this Supplemental Indenture
     shall equal the Cap Rate; or

          (b) if a Payment Default shall have occurred, the Auction Note
     Interest Rate on the Auction Rate Notes for the Interest Period commencing
     on or immediately after such Payment Default, and for each Interest Period
     thereafter, to and including the Interest Period, if any, during which, or
     commencing less than two Business Days after, such Payment Default is
     cured, shall equal the applicable Non-Payment Rate on the first day of each
     such Interest Period.

     In accordance with Section 2.02(a)(iii)(B) and (C) of this Appendix A, the
Auction Agent shall promptly give written notice to the Indenture Trustee and
the Issuer of each Auction Note Interest Rate (unless the Auction Note Interest
Rate is the applicable Non-Payment Rate) and the Maximum Rate when such rate is
not the Auction Note Interest Rate, applicable to the Auction Rate Notes. The
Indenture Trustee shall, upon request, notify the Noteholders and the Issuer of
Auction Rate Notes of the applicable Auction Note Interest Rate applicable to
such Auction Rate Notes for each Auction Period not later than the third
Business Day of such Auction Period. Notwithstanding any other provision of the
Auction Rate Notes or this Supplemental Indenture and except for the occurrence
of a Payment Default, interest payable on the Auction Rate Notes for


                                      A-8

<PAGE>

an Auction Period shall never exceed for such Auction Period the amount of
interest payable at the applicable Maximum Rate in effect for such Auction
Period.

     If the Auction Rate for the Auction Rate Notes is greater than the Net Loan
Rate, then the Auction Note Interest Rate applicable to such Auction Rate Notes
for that Interest Period will be the Net Loan Rate and the Issuer shall
determine the Carry-over Amount, if any, with respect to such Auction Rate Notes
for such Interest Period.

     Such Carry-over Amount shall bear interest calculated at a rate equal to
One-Month LIBOR (as determined by the Indenture Trustee) from the Payment Date
for the Interest Period with respect to which such Carry-over Amount was
calculated, until paid. Any payment in respect of Carry-over Amount shall be
applied, first, to any accrued interest payable thereon and, second, in
reduction of such Carry-over Amount. For purposes of this Supplemental Indenture
and this Appendix A, any reference to "principal" or "interest" herein shall not
include within the meaning of such words Carry-over Amount or any interest
accrued on any such Carry-over Amount. Such Carry-over Amount shall be
separately calculated for each Auction Rate Note by the Issuer during such
Interest Period in sufficient time for the Indenture Trustee to give notice to
each Noteholder of such Carry-over Amount as required in the next succeeding
sentence. Not less than four days before the Payment Date for an Interest Period
with respect to which such Carry-over Amount has been calculated by the Issuer,
the Indenture Trustee shall give written notice to each Noteholder, the Auction
Agent and the Issuer, in the form provided by the Issuer, of the Carry-over
Amount applicable to each Auction Rate Note, which written notice may accompany
the payment of interest made to the Noteholder on such Payment Date. Such notice
shall state, in addition to such Carry-over Amount, that, unless and until an
Auction Rate Note has been redeemed (other than by optional redemption), after
which all accrued Carry-over Amounts (and all accrued interest thereon) that
remains unpaid shall be canceled and no Carry-over Amount (and interest accrued
thereon) shall be paid with respect to such Auction Rate Note, (a) the
Carry-over Amount (and interest accrued thereon calculated at a rate equal to
One-Month LIBOR) shall be paid by the Indenture Trustee pursuant to an Issuer
Order on an Auction Rate Note on the earliest of (i) the date of defeasance of
any of the Auction Rate Notes or (ii) the first occurring Payment Date with
respect to the Auction Rate Note (or on the date of any such optional
redemption) if and to the extent that (A) the Eligible Carry-over Make-up Amount
with respect to such subsequent Interest Period is greater than zero, and (B)
moneys are available pursuant to the terms of the Indenture in an amount
sufficient to pay all or a portion of such Carry-over Amount (and interest
accrued thereon), and (b) interest shall accrue on the Carry-over Amount at a
rate equal to One-Month LIBOR until such Carry-over Amount is paid in full or is
cancelled.

     The Carry-over Amount (and interest accrued thereon) for Auction Rate Notes
shall be paid by the Indenture Trustee pursuant to an Issuer Order on
Outstanding Auction Rate Notes on the earliest of (a) the date of defeasance of
any of the Auction Rate Notes or (b) the first occurring Payment Date if and to
the extent that (i) the Eligible Carry-over Make-up Amount with respect to such
Interest Period is greater than zero, and (ii) on such Payment Date there are
sufficient moneys in the Revenue Fund to pay all interest due on the Auction
Rate Notes on such Payment Date, to redeem any Auction Rate Notes required to be
redeemed on such Payment Date in accordance with the Indenture and to fund
amounts required to be added to the Reserve Fund on such Payment Date. Any
Carry-over Amount (and any interest accrued thereon) on any Auction Rate Note
that is due


                                      A-9

<PAGE>

and payable on a Payment Date, which Auction Rate Note is to be redeemed (other
than by optional redemption) on said Payment Date, shall be paid to the
Noteholder thereof on said Payment Date to the extent that moneys are available
therefor in accordance with the provisions of this Appendix A; provided,
however, that any Carry-over Amount (and any interest accrued thereon) that is
not yet due and payable on said Payment Date shall be cancelled with respect to
said Auction Rate Note that is to be redeemed (other than by optional
redemption) on said Payment Date and shall not be paid on any succeeding Payment
Date. To the extent that any portion of the Carry-over Amount (and any interest
accrued thereon) remains unpaid after payment of a portion thereof, such unpaid
portion shall be paid in whole or in part as required hereunder until fully paid
by the Indenture Trustee on the earliest of (a) the date of defeasance of any of
the Auction Rate Notes or (b) the next occurring Payment Date or Dates, as
necessary, if and to the extent that the conditions in the second preceding
sentence are satisfied. On any Payment Date on which the Indenture Trustee pays
only a portion of the Carry-over Amount (and any interest accrued thereon) on
Auction Rate Notes, the Indenture Trustee shall give written notice in the
manner set forth in the immediately preceding paragraph to the Noteholder of
such Auction Rate Note receiving such partial payment of the Carry-over Amount
remaining unpaid on such Auction Rate Note.

     The Payment Date or other date on which such Carry-over Amount (or any
interest accrued thereon) for Auction Rate Notes shall be paid shall be
determined by the Indenture Trustee in accordance with the provisions of the
immediately preceding paragraph and the Indenture, and the Indenture Trustee
shall make payment of the Carry-over Amount (and any interest accrued thereon)
in the same manner as, and from the same Fund from which, it pays interest on
the Auction Rate Notes on a Payment Date. Any payment of Carry-over Amounts (and
interest accrued thereon) shall reduce the amount of Eligible Carry-over Make-up
Amount.

     In the event that the Auction Agent no longer determines, or fails to
determine, when required, the Auction Note Interest Rate with respect to Auction
Rate Notes, or, if for any reason such manner of determination shall be held to
be invalid or unenforceable, the Auction Note Interest Rate for the next
succeeding Interest Period, which Interest Period shall be an Auction Period,
for Auction Rate Notes shall be the applicable Cap Rate as determined by the
Auction Agent for such next succeeding Auction Period, and if the Auction Agent
shall fail or refuse to determine the Cap Rate, the Cap Rate shall be determined
by the securities dealer appointed by the Issuer capable of making such a
determination in accordance with the provisions of this Appendix A and written
notice of such determination shall be given by such securities dealer to the
Indenture Trustee.

     Section 2.02 Auction Rate.

     (a) Determining the Auction Rate. By purchasing Auction Rate Notes, whether
in an Auction or otherwise, each purchaser of Auction Rate Notes, or its
Broker-Dealer, must agree and shall be deemed by such purchase to have agreed
(x) to participate in Auctions on the terms described herein, (y) to have its
beneficial ownership of the Auction Rate Notes maintained at all times in
Book-entry Form for the account of its Participant, which in turn will maintain
records of such beneficial ownership, and (z) to authorize such Participant to
disclose to the Auction Agent such information with respect to such beneficial
ownership as the Auction Agent may request.


                                      A-10

<PAGE>

     So long as the ownership of Auction Rate Notes is maintained in Book-entry
Form by the Securities Depository, an Existing Owner may sell, transfer or
otherwise dispose of Auction Rate Notes only pursuant to a Bid or Sell Order
placed in an Auction or otherwise sell, transfer or dispose of Auction Rate
Notes through a Broker-Dealer; provided that, in the case of all transfers other
than pursuant to Auctions, such Existing Owner, its Broker-Dealer or its
Participant advises the Auction Agent of such transfer.

     Auctions shall be conducted on each Auction Date, if there is an Auction
Agent on such Auction Date, in the following manner:

     (i) (A)   Prior to the Submission Deadline on each Auction Date;

               (1) each Existing Owner of Auction Rate Notes may submit to a
         Broker-Dealer by telephone or otherwise any information as to:

                   a. the principal amount of Outstanding Auction Rate Notes,
               if any, owned by such Existing Owner that such Existing Owner
               desires to continue to own without regard to the Auction Note
               Interest Rate for the next succeeding Auction Period;

                   b. the principal amount of Outstanding Auction Rate Notes,
               if any, that such Existing Owner offers to sell if the Auction
               Note Interest Rate for the next succeeding Auction Period shall
               be less than the rate per annum specified by such Existing Owner;
               and/or

                   c. the principal amount of Outstanding Auction Rate Notes,
               if any, owned by such Existing Owner that such Existing Owner
               offers to sell without regard to the Auction Note Interest Rate
               for the next succeeding Auction Period;

               and

               (2) one or more Broker-Dealers may contact Potential Owners to
         determine the principal amount of Auction Rate Notes that each
         Potential Owner offers to purchase, if the Auction Note Interest Rate
         for the next succeeding Auction Period shall not be less than the rate
         per annum specified by such Potential Owner.

     The statement of an Existing Owner or a Potential Owner referred to in (1)
or (2) of this paragraph (A) is herein referred to as an "Order," and each
Existing Owner and each Potential Owner placing an Order is herein referred to
as a "Bidder"; an Order described in clause (1)a. is herein referred to as a
"Hold Order"; an Order described in clauses (1)b. and (2) is herein referred to
as a "Bid"; and an Order described in clause (1)c. is herein referred to as a
"Sell Order."

         (B)   (1) Subject to the provisions of Section 2.02(a)(ii) of this
     Appendix A, a Bid by an Existing Owner shall constitute an irrevocable
     offer to sell:


                                      A-11

<PAGE>

                    a. the principal amount of Outstanding Auction Rate Notes
               specified in such Bid if the Auction Note Interest Rate
               determined as provided in this Section 2.02(a) shall be less than
               the rate specified therein; or

                    b. such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes to be determined as set forth in
               Section 2.02(a)(iv)(A)(4) of this Appendix A, if the Auction Note
               Interest Rate determined as provided in this Section 2.02(a)
               shall be equal to the rate specified therein; or

                    c. such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes to be determined as set forth in
               Section 2.02(a)(iv)(B)(3) of this Appendix A, if the rate
               specified therein shall be higher than the applicable Maximum
               Rate and Sufficient Bids have not been made.

               (2) Subject to the provisions of Section 2.02(a)(ii) of this
          Appendix A, a Sell Order by an Existing Owner shall constitute an
          irrevocable offer to sell:

                    a. the principal amount of Outstanding Auction Rate Notes
               specified in such Sell Order; or

                    b. such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes set forth in Section
               2.02(a)(iv)(B)(3) of this Appendix A, if Sufficient Bids have not
               been made.

               (3) Subject to the provisions of Section 2.02(a)(ii) of this
          Appendix A, a Bid by a Potential Owner shall constitute an irrevocable
          offer to purchase:

                    a. the principal amount of Outstanding Auction Rate Notes
               specified in such Bid if the Auction Note Interest Rate
               determined as provided in this Section 2.02(a) shall be higher
               than the rate specified in such Bid; or

                    b. such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes set forth in Section
               2.02(a)(iv)(A)(5) of this Appendix A, if the Auction Note
               Interest Rate determined as provided in this Section 2.02(a)
               shall be equal to the rate specified in such Bid.

          (ii) (A)  Each Broker-Dealer shall submit in writing to the Auction
     Agent prior to the Submission Deadline on each Auction Date all Orders
     obtained by such Broker-Dealer and shall specify with respect to each such
     Order:

               (1)  the name of the Bidder placing such Order;


                                      A-12

<PAGE>

               (2) the aggregate principal amount of Auction Rate Notes that are
          the subject of such Order;

               (3) to the extent that such Bidder is an Existing Owner:

                         a. the principal amount of Auction Rate Notes, if any,
                   subject to any Hold Order placed by such Existing Owner;

                         b. the principal amount of Auction Rate Notes, if any,
                   subject to any Bid placed by such Existing Owner and the
                   rate specified in such Bid; and

                         c. the principal amount of Auction Rate Notes, if any,
                   subject to any Sell Order placed by such Existing Owner;

                   and

                   (4) to the extent such Bidder is a Potential Owner, the rate
               specified in such Potential Owner's Bid.

               (B) If any rate specified in any Bid contains more than three
          figures to the right of the decimal point, the Auction Agent shall
          round such rate up to the next higher one thousandth of 1%.

               (C) If an Order or Orders covering all Outstanding Auction Rate
          Notes owned by an Existing Owner is not submitted to the Auction Agent
          prior to the Submission Deadline, the Auction Agent shall deem a Hold
          Order to have been submitted on behalf of such Existing Owner covering
          the principal amount of Outstanding Auction Rate Notes owned by such
          Existing Owner and not subject to an Order submitted to the Auction
          Agent.

               (D) Neither the Issuer, the Indenture Trustee nor the Auction
          Agent shall be responsible for any failure of a Broker-Dealer to
          submit an Order to the Auction Agent on behalf of any Existing Owner
          or Potential Owner.

               (E) If any Existing Owner submits through a Broker-Dealer to the
          Auction Agent one or more Orders covering in the aggregate more than
          the principal amount of Outstanding Auction Rate Notes owned by such
          Existing Owner, such Orders shall be considered valid as follows and
          in the following order of priority:

                   (1)   All Hold Orders shall be considered valid, but only up
               to the aggregate principal amount of Outstanding Auction Rate
               Notes owned by such Existing Owner, and if the aggregate
               principal amount of Auction Rate Notes subject to such Hold
               Orders exceeds the aggregate principal amount


                                      A-13

<PAGE>

               of Auction Rate Notes owned by such Existing Owner, the aggregate
               principal amount of Auction Rate Notes subject to each such Hold
               Order shall be reduced pro rata so that the aggregate principal
               amount of Auction Rate Notes subject to such Hold Order equals
               the aggregate principal amount of Outstanding Auction Rate Notes
               owned by such Existing Owner.

                    (2)  a. Any Bid shall be considered valid up to an amount
               equal to the excess of the principal amount of Outstanding
               Auction Rate Notes owned by such Existing Owner over the
               aggregate principal amount of Auction Rate Notes subject to any
               Hold Order referred to in clause (A) of this paragraph (ii);

                         b. subject to subclause (2)a. of this clause (E), if
                    more than one Bid with the same rate is submitted on behalf
                    of such Existing Owner and the aggregate principal amount of
                    Outstanding Auction Rate Notes subject to such Bids is
                    greater than such excess, such Bids shall be considered
                    valid up to an amount equal to such excess;

                         c. subject to subclauses (2)a. and (2)b. of this clause
                    (E), if more than one Bid with different rates are submitted
                    on behalf of such Existing Owner, such Bids shall be
                    considered valid first in the ascending order of their
                    respective rates until the highest rate is reached at which
                    such excess exists and then at such rate up to the amount of
                    such excess; and

                         d. in any such event, the amount of Outstanding Auction
                    Rate Notes, if any, subject to Bids not valid under this
                    clause (E) shall be treated as the subject of a Bid by a
                    Potential Owner at the rate therein specified; and

                    (3)  All Sell Orders shall be considered valid up to an
               amount equal to the excess of the principal amount of Outstanding
               Auction Rate Notes owned by such Existing Owner over the
               aggregate principal amount of Auction Rate Notes subject to Hold
               Orders referred to in clause (1) of this paragraph (E) and valid
               Bids referred to in clause (2) of this paragraph (E).

               (F)  If more than one Bid for Auction Rate Notes is submitted on
          behalf of any Potential Owner, each Bid submitted shall be a separate
          Bid with the rate and principal amount therein specified.

               (G)  An Existing Owner that offers to purchase additional Auction
          Rate Notes is, for purposes of such offer, treated as a Potential
          Owner.


                                      A-14

<PAGE>

                (H) Any Bid or Sell Order submitted by an Existing Owner
          covering an aggregate principal amount of Auction Rate Notes not equal
          to an Authorized Denomination shall be rejected and shall be deemed a
          Hold Order. Any Bid submitted by a Potential Owner covering an
          aggregate principal amount of Auction Rate Notes not equal to an
          Authorized Denomination shall be rejected.

                (I) Any Bid specifying a rate higher than the applicable Maximum
          Rate will (1) be treated as a Sell Order if submitted by an Existing
          Owner and (2) not be accepted if submitted by a Potential Owner.

                (J) Any Order submitted in an Auction by a Broker-Dealer to the
          Auction Agent prior to the Submission Deadline on any Auction Date
          shall be irrevocable.

          (iii) (A) Not earlier than the Submission Deadline on each Auction
     Date, the Auction Agent shall assemble all valid Orders submitted or deemed
     submitted to it by the Broker-Dealers (each such Order as submitted or
     deemed submitted by a Broker-Dealer being herein referred to individually
     as a "Submitted Hold Order," a "Submitted Bid" or a "Submitted Sell Order,"
     as the case may be, or as a "Submitted Order," and collectively as
     "Submitted Hold Orders," "Submitted Bids" or "Submitted Sell Orders," as
     the case may be, or as "Submitted Orders") and shall determine:

                      (1)  the excess of the total principal amount of
                Outstanding Auction Rate Notes over the sum of the aggregate
                principal amount of Outstanding Auction Rate Notes subject to
                Submitted Hold Orders (such excess being herein referred to as
                the "Available Auction Rate Notes"), and

                      (2)  from the Submitted Orders whether:

                           a. the aggregate principal amount of Outstanding
                      Auction Rate Notes subject to Submitted Bids by Potential
                      Owners specifying one or more rates equal to or lower than
                      the applicable Maximum Rate;

                exceeds or is equal to the sum of:

                           b. the aggregate principal amount of Outstanding
                      Auction Rate Notes subject to Submitted Bids by Existing
                      Owners specifying one or more rates higher than the
                      applicable Maximum Rate; and

                           c. the aggregate principal amount of Outstanding
                      Auction Rate Notes subject to Submitted Sell Orders;

                (in the event such excess or such equality exists, other than
                because all of the Outstanding Auction Rate Notes are subject to
                Submitted Hold Orders,


                                      A-15

<PAGE>

          such Submitted Bids described in subclause a. above shall be referred
          to collectively as "Sufficient Bids"); and

                    (3)  if Sufficient Bids exist, the "Bid Auction Rate", which
          shall be the lowest rate specified in such Submitted Bids such that
          if:

                         a. (x) each Submitted Bid from Existing Owners
                    specifying such lowest rate and (y) all other Submitted Bids
                    from Existing Owners specifying lower rates were rejected,
                    thus entitling such Existing Owners to continue to own the
                    principal amount of Auction Rate Notes subject to such
                    Submitted Bids; and

                         b. (x) each such Submitted Bid from Potential Owners
                    specifying such lowest rate and (y) all other Submitted Bids
                    from Potential Owners specifying lower rates were accepted;

          the result would be that such Existing Owners described in subclause
          a. above would continue to own an aggregate principal amount of
          Outstanding Auction Rate Notes that, when added to the aggregate
          principal amount of Outstanding Auction Rate Notes to be purchased by
          such Potential Owners described in subclause b. above, would equal not
          less than the Available Auction Rate Notes.

          (B)       Promptly after the Auction Agent has made the determinations
     pursuant to Section 2.02(a)(iii)(A) of this Appendix A, the Auction Agent
     shall advise the Indenture Trustee, the Broker-Dealers and the Issuer of
     the Net Loan Rate, Maximum Rate and the All Hold Rate and the components
     thereof on the Auction Date. Based on such determinations, the Auction Rate
     for the next succeeding Interest Period will be established as follows:

                    (1)  if Sufficient Bids exist, that the Auction Rate for the
          next succeeding Interest Period shall be equal to the Bid Auction Rate
          so determined;

                    (2)  if Sufficient Bids do not exist (other than because all
          of the Outstanding Auction Rate Notes are subject to Submitted Hold
          Orders), that the Auction Rate for the next succeeding Interest Period
          shall be equal to the applicable Maximum Rate; or

                    (3)  if all Outstanding Auction Rate Notes are subject to
          Submitted Hold Orders, that the Auction Rate for the next succeeding
          Interest Period shall be equal to the applicable All Hold Rate.

          (C)       Promptly after the Auction Agent has determined the Auction
     Rate, the Auction Agent shall determine and advise the Indenture Trustee of
     the Auction


                                      A-16

<PAGE>

          Note Interest Rate, which rate shall be the lesser of (x) the Auction
          Rate and (y) the applicable Maximum Rate.

          (iv) Existing Owners shall continue to own the principal amount of
     Auction Rate Notes that are subject to Submitted Hold Orders. If the Net
     Loan Rate is equal to or greater than the Bid Auction Rate and if
     Sufficient Bids have been received by the Auction Agent, the Bid Auction
     Rate will be the Auction Note Interest Rate, and Submitted Bids and
     Submitted Sell Orders will be accepted or rejected and the Auction Agent
     will take such other action as described below in subparagraph (A).

     If the Maximum Rate is less than the Auction Rate, the Maximum Rate will be
the Auction Note Interest Rate. If the Auction Agent has not received Sufficient
Bids (other than because all of the Outstanding Auction Rate Notes are subject
to Submitted Hold Orders), the Auction Note Interest Rate will be the applicable
Maximum Rate. In any of the cases described above, Submitted Orders will be
accepted or rejected and the Auction Agent will take such other action as
described below in subparagraph (B).

               (A)  If Sufficient Bids have been made and the Maximum Rate is
          equal to or greater than the Bid Auction Rate (in which case the
          Auction Note Interest Rate shall be the Bid Auction Rate), all
          Submitted Sell Orders shall be accepted and, subject to the provisions
          of clauses (4) and (5) of this Section 2.02(a)(iv), Submitted Bids
          shall be accepted or rejected as follows in the following order of
          priority, and all other Submitted Bids shall be rejected:

                    (1) Existing Owners' Submitted Bids specifying any rate that
               is higher than the Auction Note Interest Rate shall be accepted,
               thus requiring each such Existing Owner to sell the aggregate
               principal amount of Auction Rate Notes subject to such Submitted
               Bids;

                    (2) Existing Owners' Submitted Bids specifying any rate that
               is lower than the Auction Note Interest Rate shall be rejected,
               thus entitling each such Existing Owner to continue to own the
               aggregate principal amount of Auction Rate Notes subject to such
               Submitted Bids;

                    (3) Potential Owners' Submitted Bids specifying any rate
               that is lower than the Auction Note Interest Rate shall be
               accepted;

                    (4) Each Existing Owners' Submitted Bid specifying a rate
               that is equal to the Auction Note Interest Rate shall be
               rejected, thus entitling such Existing Owner to continue to own
               the aggregate principal amount of Auction Rate Notes subject to
               such Submitted Bid, unless the aggregate principal amount of
               Outstanding Auction Rate Notes subject to all such Submitted Bids
               shall be greater than the principal amount of Auction Rate Notes
               (the "remaining principal amount") equal to the excess of the
               Available Auction Rate Notes over the aggregate principal amount
               of Auction Rate Notes subject to Submitted Bids described in
               clauses (2) and


                                      A-17

<PAGE>

               (3) of this Section 2.02(a)(iv)(A), in which event such Submitted
               Bid of such Existing Owner shall be rejected in part, and such
               Existing Owner shall be entitled to continue to own the principal
               amount of Auction Rate Notes subject to such Submitted Bid, but
               only in an amount equal to the aggregate principal amount of
               Auction Rate Notes obtained by multiplying the remaining
               principal amount by a fraction, the numerator of which shall be
               the principal amount of Outstanding Auction Rate Notes owned by
               such Existing Owner subject to such Submitted Bid and the
               denominator of which shall be the sum of the principal amount of
               Outstanding Auction Rate Notes subject to such Submitted Bids
               made by all such Existing Owners that specified a rate equal to
               the Auction Note Interest Rate, subject to the provisions of
               Section 2.02(a)(iv)(D) of this Appendix A; and

                    (5) Each Potential Owner's Submitted Bid specifying a rate
               that is equal to the Auction Note Interest Rate shall be
               accepted, but only in an amount equal to the principal amount of
               Auction Rate Notes obtained by multiplying the excess of the
               aggregate principal amount of Available Auction Rate Notes over
               the aggregate principal amount of Auction Rate Notes subject to
               Submitted Bids described in clauses (2), (3) and (4) of this
               Section 2.02(a)(iv)(A) by a fraction the numerator of which shall
               be the aggregate principal amount of Outstanding Auction Rate
               Notes subject to such Submitted Bid and the denominator of which
               shall be the sum of the principal amount of Outstanding Auction
               Rate Notes subject to Submitted Bids made by all such Potential
               Owners that specified a rate equal to the Auction Note Interest
               Rate, subject to the provisions of Section 2.02(a)(iv)(D) of this
               Appendix A.

               (B)  If Sufficient Bids have not been made (other than because
          all of the Outstanding Auction Rate Notes are subject to submitted
          Hold Orders), or if the Maximum Rate is less than the Bid Auction Rate
          (in which case the Auction Note Interest Rate shall be the Maximum
          Rate), subject to the provisions of Section 2.02(a)(iv)(D) of this
          Appendix A, Submitted Orders shall be accepted or rejected as follows
          in the following order of priority and all other Submitted Bids shall
          be rejected:

                    (1) Existing Owners' Submitted Bids specifying any rate that
               is equal to or lower than the Auction Note Interest Rate shall be
               rejected, thus entitling such Existing Owners to continue to own
               the aggregate principal amount of Auction Rate Notes subject to
               such Submitted Bids;

                    (2) Potential Owners' Submitted Bids specifying (x) any rate
               that is equal to or lower than the Auction Note Interest Rate
               shall be accepted and (y) any rate that is higher than the
               Auction Note Interest Rate shall be rejected; and


                                      A-18

<PAGE>

                    (3) each Existing Owner's Submitted Bid specifying any rate
               that is higher than the Auction Note Interest Rate and the
               Submitted Sell Order of each Existing Owner shall be accepted,
               thus entitling each Existing Owner that submitted any such
               Submitted Bid or Submitted Sell Order to sell the Auction Rate
               Notes subject to such Submitted Bid or Submitted Sell Order, but
               in both cases only in an amount equal to the aggregate principal
               amount of Auction Rate Notes obtained by multiplying the
               aggregate principal amount of Auction Rate Notes subject to
               Submitted Bids described in clause (2)(x) of this Section
               2.02(a)(iv)(B) by a fraction the numerator of which shall be the
               aggregate principal amount of Outstanding Auction Rate Notes
               owned by such Existing Owner subject to such submitted Bid or
               Submitted Sell Order and the denominator of which shall be the
               aggregate principal amount of Outstanding Auction Rate Notes
               subject to all such Submitted Bids and Submitted Sell Orders.

               (C)  If all Auction Rate Notes are subject to Submitted Hold
          Orders, all Submitted Bids shall be rejected.

               (D)  If, as a result of the procedures described in paragraph (A)
          or (B) of this Section 2.02(a)(iv), any Existing Owner would be
          entitled or required to sell, or any Potential Owner would be entitled
          or required to purchase, a principal amount of Auction Rate Notes that
          is not equal to an Authorized Denomination, the Auction Agent shall,
          in such manner as in its sole discretion it shall determine, round up
          or down the principal amount of Auction Rate Notes to be purchased or
          sold by any Existing Owner or Potential Owner so that the principal
          amount of Auction Rate Notes purchased or sold by each Existing Owner
          or Potential Owner shall be equal to an Authorized Denomination.

               (E)  If, as a result of the procedures described in paragraph (B)
          of this Section 2.02(a)(iv), any Potential Owner would be entitled or
          required to purchase less than an Authorized Denomination of Auction
          Rate Notes, the Auction Agent shall, in such manner as in its sole
          discretion it shall determine, allocate Auction Rate Notes for
          purchase among Potential Owners so that only Auction Rate Notes in
          Authorized Denominations are purchased by any Potential Owner, even if
          such allocation results in one or more of such Potential Owners not
          purchasing any Auction Rate Notes.

          (v)  Based on the result of each Auction, the Auction Agent shall
     determine the aggregate principal amount of Auction Rate Notes to be
     purchased and the aggregate principal amount of Auction Rate Notes to be
     sold by Potential Owners and Existing Owners on whose behalf each
     Broker-Dealer submitted Bids or Sell Orders and, with respect to each
     Broker-Dealer, to the extent that such aggregate principal amount of
     Auction Rate Notes to be sold differs from such aggregate principal amount
     of Auction Rate Notes to be purchased, determine to which other
     Broker-Dealer or Broker-Dealers acting for one or more purchasers such
     Broker-Dealer shall deliver, or from which other


                                      A-19

<PAGE>

     Broker-Dealer or Broker-Dealers acting for one or more sellers such
     Broker-Dealer shall receive, as the case may be, Auction Rate Notes.

          (vi)  Any calculation by the Auction Agent or the Indenture Trustee,
     as applicable, of the Auction Note Interest Rate, the Maximum Rate, the All
     Hold Rate, the Net Loan Rate and the Non-Payment Rate shall, in the absence
     of manifest error, be binding on all other parties.

          (vii) Notwithstanding anything in this Appendix A to the contrary, (A)
     no Auction for the Auction Rate Notes for an Auction Period of less than
     180 days will be held on any Auction Date hereunder on which there are
     insufficient moneys in the Revenue Fund to pay, or otherwise held by the
     Indenture Trustee under the Indenture and available to pay, the principal
     of and interest due on the Auction Rate Notes on the Payment Date
     immediately following such Auction Date, and (B) no Auction will be held on
     any Auction Date hereunder during the continuance of a Payment Default. The
     Indenture Trustee shall promptly notify the Auction Agent of any such
     occurrence.

     (b)  Application of Interest Payments for the Auction Rate Notes.

          (i)   The Indenture Trustee shall determine not later than 2:00 p.m.,
     eastern time, on the Business Day next succeeding a Payment Date, whether a
     Payment Default has occurred. If a Payment Default has occurred, the
     Indenture Trustee shall, not later than 2:15 p.m., eastern time, on such
     Business Day, send a notice thereof in substantially the form of Exhibit C
     attached hereto to the Auction Agent by telecopy or similar means and, if
     such Payment Default is cured, the Indenture Trustee shall immediately send
     a notice in substantially the form of Exhibit D attached hereto to the
     Auction Agent by telecopy or similar means.

          (ii)  Not later than 2:00 p.m., eastern time, on each anniversary of
     the Closing Date, the Indenture Trustee shall pay to the Auction Agent, in
     immediately available funds out of amounts in the Revenue Fund, an amount
     equal to the Auction Agent Fee as set forth in the Auction Agent Agreement
     as set forth in the Servicer's Report. Not later than 2:00 p.m., eastern
     time, on each Auction Date, the Indenture Trustee shall pay to the Auction
     Agent, in immediately available funds out of amounts in the Revenue Fund,
     an amount equal to the Broker-Dealer Fee as calculated in the Auction Agent
     Agreement. The Indenture Trustee shall, from time to time at the request of
     the Auction Agent and at the direction of an Authorized Officer, reimburse
     the Auction Agent for its reasonable expenses as provided in the Auction
     Agent Agreement, such expenses to be paid out of amounts in the Revenue
     Fund.

     (c)  Calculation of Maximum Rate, All Hold Rate, Net Loan Rate, Applicable
LIBOR Rate, and Non-Payment Rate. The Auction Agent shall calculate the
applicable Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold
Rate, as the case may be, on each Auction Date and shall notify the Indenture
Trustee and the Broker-Dealers of the applicable Maximum Rate, Net Loan Rate,
Applicable LIBOR Rate, and All Hold Rate, as the case may be, as provided in the
Auction Agent Agreement; provided, that if the ownership of the Auction Rate
Notes is no


                                      A-20

<PAGE>

longer maintained in Book-entry Form, or if a Payment Default has occurred, then
the Indenture Trustee shall determine the applicable Maximum Rate, Net Loan
Rate, Applicable LIBOR Rate, All Hold Rate and Non-Payment Rate for each such
Interest Period. If the ownership of the Auction Rate Notes is no longer
maintained in Book-entry Form by the Securities Depository, the Indenture
Trustee shall calculate the applicable Maximum Rate and the Net Loan Rate on the
Business Day immediately preceding the first day of each Interest Period after
the delivery of certificates representing the Auction Rate Notes pursuant to the
Indenture. If a Payment Default shall have occurred, the Indenture Trustee shall
calculate the Non-Payment Rate on the Interest Rate Determination Date for (i)
each Interest Period commencing after the occurrence and during the continuance
of such Payment Default and (ii) any Interest Period commencing less than two
Business Days after the cure of any Payment Default. The determination by the
Indenture Trustee or the Auction Agent, as the case may be, of the applicable
Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and
Non-Payment Rate shall (in the absence of manifest error) be final and binding
upon all parties. If calculated or determined by the Auction Agent, the Auction
Agent shall promptly advise the Indenture Trustee of the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold Rate.

     (d)   Notification of Rates, Amounts and Payment Dates.

           (i)  By 12:00 noon, eastern time, on the Business Day following each
     Regular Record Date, the Indenture Trustee shall determine the aggregate
     amounts of interest distributable on the next succeeding Payment Date to
     the beneficial owners of Auction Rate Notes.

          (ii)  At least four days prior to any Payment Date, the Indenture
     Trustee shall:

                (A) confirm with the Auction Agent, so long as no Payment
          Default has occurred and is continuing and the ownership of the
          Auction Rate Notes is maintained in Book-entry Form by the Securities
          Depository, (1) the date of such next Payment Date and (2) the amount
          payable to the Auction Agent on the Auction Date pursuant to Section
          2.02(b)(ii) of this Appendix A; and

                (B) advise the Securities Depository, so long as the ownership
          of the Auction Rate Notes is maintained in Book-entry Form by the
          Securities Depository, upon request, of the aggregate amount of
          interest distributable on such next Payment Date to the beneficial
          owners of each Series of the Auction Rate Notes.

     If any day scheduled to be a Payment Date shall be changed after the
Indenture Trustee shall have given the notice or confirmation referred to in
clause (i) of the preceding sentence, the Indenture Trustee shall, not later
than 11:15 a.m., eastern time, on the Business Day next preceding the earlier of
the new Payment Date or the old Payment Date, by such means as the Indenture
Trustee deems practicable, give notice of such change to the Auction Agent, so
long as no Payment Default has occurred and is continuing and the ownership of
the Auction Rate Notes is maintained in Book-entry Form by the Securities
Depository.

          (e)   Auction Agent.

                                      A-21

<PAGE>

     (i)   Deutsche Bank Trust Company Americas is hereby appointed as Initial
Auction Agent to serve as agent for the Issuer in connection with Auctions. The
Indenture Trustee and the Issuer will, and the Indenture Trustee is hereby
directed to, enter into the Initial Auction Agent Agreement with Deutsche Bank
Trust Company Americas, as the Initial Auction Agent. Any Substitute Auction
Agent shall be (A) a bank, national banking association or trust company duly
organized under the laws of the United States of America or any state or
territory thereof having its principal place of business in the Borough of
Manhattan, New York, or such other location as approved by the Indenture Trustee
in writing and having a combined capital stock or surplus of at least
$50,000,000, or (B) a member of the National Association of Securities Dealers,
Inc., having a capitalization of at least $50,000,000, and, in either case,
authorized by law to perform all the duties imposed upon it hereunder and under
the Auction Agent Agreement. The Auction Agent may at any time resign and be
discharged of the duties and obligations created by this Appendix A by giving at
least 90 days' notice to the Indenture Trustee, each Broker-Dealer and the
Issuer. The Auction Agent may be removed at any time by the Indenture Trustee
upon the written direction of an Authorized Officer or by the holders of a
majority of the aggregate principal amount of the Auction Rate Notes then
Outstanding, and if by such Noteholders, by an instrument signed by such
Noteholders or their attorneys and filed with the Auction Agent, the Issuer and
the Indenture Trustee upon at least 90 days' written notice. Neither resignation
nor removal of the Auction Agent pursuant to the preceding two sentences shall
be effective until and unless a Substitute Auction Agent has been appointed and
has accepted such appointment. If required by the Issuer, a Substitute Auction
Agent Agreement shall be entered into with a Substitute Auction Agent.
Notwithstanding the foregoing, the Auction Agent may terminate the Auction Agent
Agreement if, within 25 days after notifying the Indenture Trustee, each
Broker-Dealer and the Issuer in writing that it has not received payment of any
Auction Agent Fee due it in accordance with the terms of the Auction Agent
Agreement, the Auction Agent does not receive such payment.

     (ii)  If the Auction Agent shall resign or be removed or be dissolved, or
if the property or affairs of the Auction Agent shall be taken under the control
of any state or federal court or administrative body because of bankruptcy or
insolvency, or for any other reason, the Indenture Trustee at the direction of
an Authorized Officer, shall use its best efforts to appoint a Substitute
Auction Agent.

     (iii) The Auction Agent is acting as agent for the Issuer in connection
with Auctions. In the absence of bad faith, negligent failure to act or
negligence on its part, the Auction Agent shall not be liable for any action
taken, suffered or omitted or any error of judgment made by it in the
performance of its duties under the Auction Agent Agreement and shall not be
liable for any error of judgment made in good faith unless the Auction Agent
shall have been negligent in ascertaining (or failing to ascertain) the
pertinent facts.

(f)  Broker-Dealers.


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     (i)   The Auction Agent will enter into a Broker-Dealer Agreement with
William R. Hough & Co., as the sole initial Broker-Dealer for Series A-8 Notes,
Series A-9 Notes, Series A-10 Notes, Series A-11 Notes and Series B-2 Notes, and
Salomon Smith Barney Inc., as the sole initial Broker-Dealer for Series A-12
Notes and Series A-13 Notes. An Authorized Officer may, from time to time,
approve one or more additional persons to serve as a Broker-Dealer under the
Broker-Dealer Agreements and shall be responsible for providing such
Broker-Dealer Agreements to the Indenture Trustee and the Auction Agent.

     (ii)  Any Broker-Dealer may be removed at any time, at the request of an
Authorized Officer, but there shall, at all times, be at least one Broker-Dealer
appointed and acting as such.

(g)  Changes in Auction Period or Periods and Certain Percentages.

     (i)   While any of the Auction Rate Notes are Outstanding, the Issuer may,
from time to time, change the length of one or more Auction Periods (an "Auction
Period Adjustment"), to conform with then current market practice with respect
to similar securities or to accommodate economic and financial factors that may
affect or be relevant to the length of the Auction Period and the interest rate
borne by the Auction Rate Notes. The Issuer shall not initiate an Auction Period
Adjustment unless it shall have received the written consent of the Market
Agent, which consent shall not be unreasonably withheld, not later than nine
days prior to the Auction Date for such Auction Period. The Issuer shall
initiate the Auction Period Adjustment by giving written notice by Issuer Order
to the Indenture Trustee, the Auction Agent, the Market Agent, each
Broker-Dealer, each Rating Agency and the Securities Depository in substantially
the form of, or containing substantially the information contained in, Exhibit E
attached hereto at least 10 days prior to the Auction Date for such Auction
Period.

     (ii)  Any such adjusted Auction Period shall not be less than 7 days nor
more than 366 days.

     (iii) An Auction Period Adjustment shall take effect only if (A) the
Indenture Trustee and the Auction Agent receive, by 11:00 a.m., eastern time, on
the Business Day before the Auction Date for the first such Auction Period, an
Issuer Certificate in substantially the form attached as, or containing
substantially the same information contained in, Exhibit F attached hereto,
authorizing the Auction Period Adjustment specified in such certificate along
with a copy of the written consent of the Market Agent and, (B) Sufficient Bids
exist as of the Auction on the Auction Date for such first Auction Period. If
the condition referred to in (A) above is not met, the applicable Auction Note
Interest Rate for the next Auction Period shall be determined pursuant to the
above provisions of this Section 2.02 and the Auction Period shall be the
Auction Period determined without reference to the proposed change. If the
condition referred to in (A) is met but the condition referred in (B) above is
not met, the applicable Auction Note Interest Rate for the next Auction Period
shall be the applicable Maximum Rate and the Auction Period shall be the Auction
Period determined without reference to the proposed change.


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<PAGE>

     In connection with any Auction Period Adjustment, the Auction Agent shall
provide such further notice to such parties as is specified in Section 2.03 of
the Auction Agent Agreement.

     (h)   Changes in the Auction Date. The Market Agent, with the written
consent of the Administrator on behalf of the Issuer, may specify a different
Auction Date (but in no event more than five Business Days earlier than the
Auction Date that would otherwise be determined in accordance with the
definition of "Auction Date" in Section 1.01 of this Appendix A) with respect to
one or more specified Auction Periods to conform with then current market
practice with respect to similar securities or to accommodate economic and
financial factors that may affect or be relevant to the day of the week
constituting an Auction Date and the interest rate borne on the Auction Rate
Notes. The Market Agent shall deliver a written request for consent to such
change in the length of the Auction Date to the Administrator at least 14 days
prior to the effective date of such change. If the Administrator shall have
delivered such written consent to the Market Agent, the Market Agent shall
provide notice of its determination to specify an earlier Auction Date for one
or more Auction Periods by means of a written notice delivered at least 10 days
prior to the proposed changed Auction Date to the Indenture Trustee, the Auction
Agent, the Issuer, the Administrator, each Rating Agency and the Securities
Depository. Such notice shall be substantially in the form of, or contain
substantially the information contained in, Exhibit G attached hereto.

     In connection with any change described in this Section 2.02(h), the
Auction Agent shall provide such further notice to such parties as is specified
in Section 2.03 of the Auction Agent Agreement.

     Section 2.03 Additional Provisions Regarding the Interest Rates on the
Auction Rate Notes. The determination of an Auction Note Interest Rate by the
Auction Agent or any other Person pursuant to the provisions of the applicable
Section of this Article II shall be conclusive and binding on the Noteholders of
the Auction Rate Notes to which such Auction Note Interest Rate applies, and the
Issuer and the Indenture Trustee may rely thereon for all purposes.

     In no event shall the cumulative amount of interest paid or payable on the
Auction Rate Notes (including interest calculated as provided herein, plus any
other amounts that constitute interest on the Auction Rate Notes under
applicable law and are contracted for, charged, reserved, taken or received
pursuant to the Auction Rate Notes or related documents) calculated from the
Closing Date of the Auction Rate Notes through any subsequent day during the
term of the Auction Rate Notes or otherwise prior to payment in full of the
Auction Rate Notes exceed the amount permitted by applicable law. If the
applicable law is ever judicially interpreted so as to render usurious any
amount called for under the Auction Rate Notes or related documents or otherwise
contracted for, charged, reserved, taken or received in connection with the
Auction Rate Notes, or if the redemption or acceleration of the maturity of the
Auction Rate Notes results in payment to or receipt by the Noteholder or any
former Noteholder of the Auction Rate Notes of any interest in excess of that
permitted by applicable law, then, notwithstanding any provision of the Auction
Rate Notes or related documents to the contrary, all excess amounts theretofore
paid or received with respect to the Auction Rate Notes shall be credited on the
principal balance of the Auction Rate Notes (or, if the Auction Rate Notes have
been paid or would thereby be paid in full, refunded by the recipient thereof),
and the provisions of the Auction Rate Notes and related


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<PAGE>

documents shall automatically and immediately be deemed reformed and the amounts
thereafter collectible hereunder and thereunder reduced, without the necessity
of the execution of any new document, so as to comply with the applicable law,
but so as to permit the recovery of the fullest amount otherwise called for
under the Auction Rate Notes and under the related documents.


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