<PAGE>

                                                                     EXHIBIT 4.5

                                                                  EXECUTION COPY

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

                               INDENTURE OF TRUST

                                 by and between

             COLLEGIATE FUNDING SERVICES EDUCATION LOAN TRUST 2003-B

                                       and

                         U.S. BANK NATIONAL ASSOCIATION,
                           as Eligible Lender Trustee
                                 and as Trustee

                          Dated as of November 1, 2003

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

<PAGE>

             COLLEGIATE FUNDING SERVICES EDUCATION LOAN TRUST 2003-B

      Reconciliation and tie between Trust Indenture Act of 1939, as amended
(the "Trust Indenture Act" or "TIA") and Indenture of Trust, dated as of
November 1, 2003.

<TABLE>
<CAPTION>
TRUST INDENTURE ACT SECTION              INDENTURE SECTION
<S>                                      <C>
Section 310(a)(1)                              7.23
310(a)(2)                                      7.23
310(b)                                         7.23, 7.09
Section 311(a)                                 7.08
311(b)                                         7.08
Section 312(b)                                 9.17
312(c)                                         9.17
Section 313(a)                                 4.15
313(b)                                         4.15
313(c)                                         4.15, 8.04
Section 314(a)(1)                              4.16
314(a)(2)                                      4.16
314(a)(3)                                      4.16
314(a)(4)                                      4.16
314(c)                                         2.02, 5.06
314(d)(1)                                      5.06
Section 315(b)                                 8.04
Section 317(a)(1)                              4.17
317(a)(2)                                      7.24
Section 318(a)                                 9.09
318(c)                                         9.09
</TABLE>

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

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

<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>
<CAPTION>
                                                                                                               Page
<S>                                                                                                            <C>
                                                      ARTICLE I

                                           DEFINITIONS AND USE OF PHRASES

                                                     ARTICLE II

                                           NOTE DETAILS AND FORM OF NOTES

Section 2.01     Note Details...............................................................................    29
Section 2.02     Execution, Authentication and Delivery of Notes............................................    29
Section 2.03     Registration, Transfer and Exchange of Notes; Persons Treated as Registered Owners.........    29
Section 2.04     Lost, Stolen, Destroyed and Mutilated Notes................................................    30
Section 2.05     Trustee's Authentication Certificate.......................................................    31
Section 2.06     Cancellation and Destruction of Notes by the Trustee.......................................    31
Section 2.07     Temporary Notes............................................................................    31
Section 2.08     Issuance of Notes..........................................................................    31
Section 2.09     Definitive Notes...........................................................................    31
Section 2.10     Payment of Principal and Interest..........................................................    32

                                                     ARTICLE III

                  PARITY AND PRIORITY OF LIEN; OTHER OBLIGATIONS; AND DERIVATIVE PRODUCT AGREEMENTS

Section 3.01     Parity and Priority of Lien................................................................    33
Section 3.02     Other Obligations..........................................................................    33
Section 3.03     Derivative Product Agreements; Counterparty Payments; Issuer Derivative Payments...........    34

                                                     ARTICLE IV

                              PROVISIONS APPLICABLE TO THE NOTES; DUTIES OF THE ISSUER

Section 4.01     Payment of Principal and Interest..........................................................    34
Section 4.02     Covenants as to Additional Conveyances.....................................................    34
Section 4.03     Further Covenants of the Issuer............................................................    34
Section 4.04     Enforcement of Servicing Agreements........................................................    35
Section 4.05     Procedures for Transfer of Funds...........................................................    36
Section 4.06     Additional Covenants with Respect to the Act...............................................    36
</TABLE>

                                       i

<PAGE>

<TABLE>
<S>                                                                                                             <C>
Section 4.07     Financed Eligible Loans; Collections Thereof; Assignment Thereof...........................    38
Section 4.08     Appointment of Agents, Direction to Trustee, Etc...........................................    39
Section 4.09     Capacity to Sue............................................................................    39
Section 4.10     Continued Existence; Successor to Issuer...................................................    39
Section 4.11     Amendment of Student Loan Purchase Agreements..............................................    39
Section 4.12     Representations; Negative Covenants........................................................    39
Section 4.13     Additional Covenants.......................................................................    45
Section 4.14     Providing of Notice........................................................................    47
Section 4.15     Certain Reports............................................................................    47
Section 4.16     Statement as to Compliance.................................................................    48
Section 4.17     Representations of the Issuer Regarding the Trustee's Security Interest....................    49
Section 4.18     Further Covenants of the Issuer Regarding the Trustee's Security Interest..................    49

                                                      ARTICLE V

                                                        FUNDS

Section 5.01     Creation and Continuation of Funds and Accounts............................................    50
Section 5.02     Acquisition Fund...........................................................................    50
Section 5.03     Collection Fund............................................................................    51
Section 5.04     Reserve Fund...............................................................................    58
Section 5.05     Capitalized Interest Account...............................................................    58
Section 5.06     Investment of Funds Held by Trustee........................................................    59
Section 5.07     Release....................................................................................    63

                                                     ARTICLE VI

                                                DEFAULTS AND REMEDIES

Section 6.01     Events of Default Defined..................................................................    64
Section 6.02     Remedy on Default; Possession of Trust Estate..............................................    64
Section 6.03     Remedies on Default; Advice of Counsel.....................................................    66
Section 6.04     Remedies on Default; Sale of Trust Estate..................................................    66
Section 6.05     Appointment of Receiver....................................................................    67
Section 6.06     Restoration of Position....................................................................    67
Section 6.07     Purchase of Properties by Trustee or Registered Owners or Counterparties...................    67
Section 6.08     Application of Sale Proceeds...............................................................    67
Section 6.09     Acceleration of Maturity; Rescission and Annulment.........................................    67
Section 6.10     Remedies Not Exclusive.....................................................................    68
Section 6.11     Collection of Indebtedness and Suits for Enforcement by Trustee............................    68
Section 6.12     Direction of Trustee.......................................................................    69
Section 6.13     Right to Enforce in Trustee................................................................    70
Section 6.14     Physical Possession of Obligations Not Required............................................    70
Section 6.15     Waivers of Events of Default...............................................................    70
</TABLE>

                                       ii

<PAGE>

<TABLE>
<S>                                                                                                             <C>
                                                     ARTICLE VII

                                                     THE TRUSTEE

Section 7.01     Acceptance of Trust........................................................................    71
Section 7.02     Recitals of Others.........................................................................    71
Section 7.03     As to Filing of Indenture..................................................................    72
Section 7.04     Trustee May Act Through Agents.............................................................    72
Section 7.05     Indemnification of Trustee.................................................................    72
Section 7.06     Trustee's Right to Reliance................................................................    73
Section 7.07     Compensation of Trustee....................................................................    74
Section 7.08     Trustee May Own Notes......................................................................    74
Section 7.09     Resignation of Trustee.....................................................................    74
Section 7.10     Removal of Trustee.........................................................................    75
Section 7.11     Successor Trustee..........................................................................    75
Section 7.12     Manner of Vesting Title in Trustee.........................................................    76
Section 7.13     Additional Covenants by the Trustee to Conform to the Act..................................    76
Section 7.14     Right of Inspection........................................................................    76
Section 7.15     Limitation with Respect to Examination of Reports..........................................    77
Section 7.16     Servicing Agreement........................................................................    77
Section 7.17     Additional Covenants of Trustee............................................................    77
Section 7.18     Duty of Trustee with Respect to Rating Agencies............................................    77
Section 7.19     Merger of the Trustee......................................................................    78
Section 7.20     Receipt of Funds from Servicer.............................................................    78
Section 7.21     Special Circumstances Leading to Resignation of Trustee....................................    78
Section 7.22     Survival of Trustee's Rights to Receive Compensation, Reimbursement and
                 Indemnification............................................................................    78
Section 7.23     Corporate Trustee Required; Eligibility; Conflicting Interests.............................    78
Section 7.24     Trustee May File Proofs of Claim...........................................................    79
Section 7.25     Determination of LIBOR.....................................................................    79

                                                    ARTICLE VIII

                                               SUPPLEMENTAL INDENTURES

Section 8.01     Supplemental Indentures Not Requiring Consent of Registered Owners or
                 Counterparties.............................................................................    80
Section 8.02     Supplemental Indentures Requiring Consent of Registered Owners and Counterparties..........    81
Section 8.03     Additional Limitation on Modification of Indenture.........................................    82
Section 8.04     Notice of Defaults.........................................................................    82
Section 8.05     Conformity with the Trust Indenture Act....................................................    82

                                                     ARTICLE IX

                                                 GENERAL PROVISIONS
</TABLE>

                                       iii

<PAGE>

<TABLE>
<S>                                                                                                             <C>
Section 9.01     Notices....................................................................................    82
Section 9.02     Covenants Bind Issuer......................................................................    84
Section 9.03     Lien Created...............................................................................    84
Section 9.04     Severability of Lien.......................................................................    84
Section 9.05     Consent of Registered Owners Binds Successors..............................................    84
Section 9.06     Nonliability of Persons; No General Obligation.............................................    84
Section 9.07     Nonpresentment of Notes or Interest Checks.................................................    85
Section 9.08     Security Agreement.........................................................................    85
Section 9.09     Laws Governing.............................................................................    85
Section 9.10     Severability...............................................................................    85
Section 9.11     Exhibits...................................................................................    85
Section 9.12     Non-Business Days..........................................................................    85
Section 9.13     Parties Interested Herein..................................................................    85
Section 9.14     Obligations Are Limited Obligations........................................................    86
Section 9.15     Counterparty Rights........................................................................    86
Section 9.16     Disclosure of Names and Addresses of Registered Owners.....................................    86
Section 9.17     Aggregate Principal Amount of Obligations..................................................    86
Section 9.18     Financed Eligible Loans....................................................................    86
Section 9.19     Concerning the Delaware Trustee............................................................    86

                                                      ARTICLE X

                           PAYMENT AND CANCELLATION OF NOTES AND SATISFACTION OF INDENTURE

Section 10.01    Trust Irrevocable..........................................................................    87
Section 10.02    Satisfaction of Indenture..................................................................    87
Section 10.03    Optional Purchase of All Financed Eligible Loans...........................................    89
Section 10.04    Auction of Financed Eligible Loans.........................................................    89

EXHIBIT A        ELIGIBLE LOAN ACQUISITION CERTIFICATE
EXHIBIT B-1      FORM OF CLASS A-1 NOTE
EXHIBIT B-2      FORM OF CLASS A-2 NOTE
EXHIBIT B-3      FORM OF AUCTION RATE NOTE
EXHIBIT C        FORM OF ADMINISTRATOR'S MONTHLY PAYMENT DATE CERTIFICATE
EXHIBIT D        FORM OF ADMINISTRATOR'S DISTRIBUTION DATE CERTIFICATE
EXHIBIT E        FORM OF SERVICER'S REPORT
EXHIBIT F        BORROWER INCENTIVES AND OTHER SPECIAL PROGRAMS

ANNEX 1          PROVISIONS RELATING TO AUCTION RATE NOTES
</TABLE>

                                       iv

<PAGE>

                               INDENTURE OF TRUST

      THIS INDENTURE OF TRUST, dated as of November 1, 2003 (this "Indenture"),
is by and between Collegiate Funding Services Education Loan Trust 2003-B (the
"Issuer"), a statutory trust duly organized and existing under the laws of the
State of Delaware (the "State"), and U.S. Bank National Association, a national
banking association duly organized and operating under the laws of the United
States of America (together with its successors, the "Trustee"), as indenture
trustee hereunder and eligible lender trustee under the Issuer Eligible Lender
Trust Agreement (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 is duly created as a statutory trust under the laws of
the State and by proper action has duly authorized the execution and delivery of
this Indenture, which Indenture provides for the issuance of student loan
asset-backed notes (the "Notes") to finance the acquisition of certain student
loans from the Sponsor and the payment to Holders of the Notes and to any
Counterparty; and

      WHEREAS, pursuant to the Issuer Eligible Lender Trust Agreement, the
Eligible Lender Trustee will hold legal title to such student loans acquired by
the Issuer; and

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

      WHEREAS, the 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 Registered
Owners of the Notes (the Registered Owners 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 Agreement (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 the Eligible Lender Trustee, in
consideration of the premises and acceptance by the Trustee of the trusts herein
created, of the purchase and acceptance of the Notes by the Registered Owners
thereof, of the execution and delivery of any Derivative Product Agreement by a
Counterparty and the Issuer and the acknowledgement thereof by the Trustee, and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, do hereby GRANT, CONVEY, PLEDGE, TRANSFER, ASSIGN AND
DELIVER to the Trustee, for the benefit of the Registered Owners of the Notes
and any Counterparty (to secure the payment of any and all amounts which may
from time to time become due and owing to a Counterparty pursuant to any
Derivative Product Agreement),

<PAGE>

all of the moneys, rights and properties described in the granting clauses A
through F below (the "Trust Estate"), as follows:

                                GRANTING CLAUSE A

      The Available Funds and Accounts (other than moneys released from the lien
of the Trust Estate as provided herein);

                                GRANTING CLAUSE B

      All Funds and Accounts created under Section 5.01 hereof, and all moneys
and investments held therein, including all proceeds thereof and all income
thereon;

                                GRANTING CLAUSE C

      The Financed Eligible Loans and all obligations of the obligors thereunder
including all moneys accrued and paid thereunder on or after the Cutoff Date;

                                GRANTING CLAUSE D

      The rights of the Issuer and/or the Eligible Lender Trustee in and to the
Eligible Lender Trust Agreements, any Servicing Agreement, the Student Loan
Purchase Agreements, the Administration Agreement, any Back-Up Administration
Agreement, the Custodian Agreements and the Guarantee Agreements as the same
relate to Financed Eligible Loans;

                                GRANTING CLAUSE E

      The rights of the Issuer in and to the Derivative Product Agreements;
provided, however, that this Granting Clause E shall not be for the benefit of a
Counterparty with respect to the Derivative Product Agreements; 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 Trustee as additional security
hereunder.

      TO HAVE AND TO HOLD the Trust Estate, whether now owned or held or
hereafter acquired, unto the 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
Registered Owners of the Notes, 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;

                                       2
<PAGE>

      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 V hereof, or shall provide, as
permitted hereby, for the payment thereof by depositing with the Trustee sums
sufficient to pay or to provide for payment of the entire amount due and to
become so due as herein provided (including payments due and payable to any
Counterparty), then this Indenture (other than Sections 4.13, 4.14 (for a period
of 90 days) and 7.05 hereof) 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

                         DEFINITIONS AND USE OF PHRASES

      Capitalized terms used herein and not otherwise defined shall have the
meanings set forth below or in Annex 1 hereto, unless the context clearly
requires otherwise.

      "Account" shall mean any of the accounts created and established by this
Indenture.

      "Acquisition Fund" shall mean the Fund by that name created in Section
5.01(a) hereof and further described in Section 5.02 hereof, including any
Accounts and Subaccounts created therein.

      "Acquisition Period" shall mean the period beginning on the Closing Date
and ending on the earlier of the date that there is no Remaining Acquisition
Amount in the Acquisition Fund and January 31, 2004.

      "Act" shall mean the Higher Education Act of 1965, as amended or
supplemented from time to time, or any successor federal act and all
regulations, directives, bulletins and guidelines promulgated from time to time
thereunder.

      "Add-On Loan" shall mean, with respect to a consolidation loan owned by
the Issuer and Financed under the Indenture, the increased balance of such
consolidation loan arising out of amounts required to be paid to an Eligible
Lender at the request of the related borrower within 180 days of the date such
Student Loan was originated.

      "Add-On Period" shall mean the period commencing on the closing date and
ending 180 days after the end of the Acquisition Period.

      "Adjusted Pool Balance" shall mean, for any Quarterly Distribution Date as
determined by the Administrator, the sum of (a) the Pool Balance as of the last
day of the immediately preceding Collection Period and (b) the Reserve Fund
Requirement for such Quarterly Distribution Date.

                                       3
<PAGE>

      "Administration Agreement" shall mean the Administration Agreement dated
as of November 1, 2003, among the Issuer, the Administrator, the Trustee, the
Eligible Lender Trustee to the Administrator and the Delaware Trustee as such
agreement may be amended or supplemented from time to time.

      "Administration Fee" shall mean a fee, payable on each Quarterly
Distribution Date to the Administrator, equal to 1/12 of 0.15% of the Pool
Balance as of the last day of the immediately preceding Collection Period, or
such greater or lesser amount as may be provided by Issuer Order (provided that
the Rating Agency Confirmation has been met with respect to such Issuer Order).

      "Administrator" shall mean Collegiate Funding Portfolio Administration,
L.L.C. in its capacity as administrator under that certain Administration
Agreement, or any other Person providing similar services and satisfying the
Rating Agency Confirmation.

      "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 Rate Carry-Over Amount" shall mean, for a class of Auction Rate
Notes, the Class A-3 Carry-Over Amount, the Class A-4 Carry-Over Amount, the
Class A-5 Carry-Over Amount, the Class A-6 Carry-Over Amount, the Class A-7
Carry-Over Amount, the Class B-1 Carry-Over Amount or the Class B-2 Carry-Over
Amount, as applicable, in each case, to the extent owed pursuant to Annex 1
hereto (including interest accrued thereon as specified in such Section.)

      "Auction Rate Notes" shall mean the Class A-3 Notes, the Class A-4 Notes,
the Class A-5 Notes, the Class A-6 Notes, the Class A-7 Notes, the Class B-1
Notes and the Class B-2 Notes.

      "Auction Rate Notes Accrued Interest Amount" shall mean, for any Quarterly
Distribution Date, the sum of the Class A-3 Noteholders' Accrued Interest
Amount, Class A-4 Noteholders' Accrued Interest Amount, Class A-5 Noteholders'
Accrued Interest Amount, Class A-6 Noteholders' Accrued Interest Amount, Class
A-7 Noteholders' Accrued Interest Amount, Class B-1 Noteholders' Accrued
Interest Amount and Class B-2 Noteholders' Accrued Interest Amount for such
Quarterly Distribution Date.

      "Authorized Representative" shall mean, when used with reference to the
Issuer, any Person duly authorized by the Trust Agreement to act on the Issuer's
behalf.

      "Available Funds" shall mean, with respect to a Distribution Date or any
related Monthly Payment Date, the sum of the following amounts received to the
extent not previously distributed: (a) all collections received by a Servicer on
the Financed Eligible Loans (including payments from any Guaranty Agency
received with respect to the Financed Eligible Loans but net of (i) any payments
made or required to be made by the Issuer pursuant to the Joint Sharing

                                       4
<PAGE>

Agreement; and (ii) any proceeds used to purchase Eligible Loans which
constitute Add-On Loans; (b) any Interest Benefit Payments and Special Allowance
Payments received by the Trustee with respect to Financed Eligible Loans; (c)
all Liquidation Proceeds from any Financed Eligible Loans which have become
Liquidated Financed Eligible Loans in accordance with a Servicer's customary
servicing procedures, and all other moneys collected with respect to any
Liquidated Financed Eligible Loan which has been written off, net of the sum of
any amounts expended by a Servicer in connection with such liquidation and any
amounts required by law to be remitted to the obligor on such Liquidated
Financed Eligible Loan; (d) the aggregate Purchase Amounts received for Financed
Eligible Loans sold by the Issuer; (e) the aggregate amounts, if any, received
from the Seller or a Servicer, as the case may be, as reimbursement of
non-guaranteed amounts, or lost Interest Benefit Payments and Special Allowance
Payments, with respect to the Financed Eligible Loans pursuant to a Student Loan
Purchase Agreement or a Servicing Agreement, respectively; (f) other amounts
received by a Servicer pursuant to its role as Servicer under a Servicing
Agreement and paid to the Issuer (g) all interest earned or gain realized from
the investment of amounts in any Fund or Account; (h) any payments received
under a Derivative Product Agreement from a Counterparty in respect of such
Distribution Date; and (i) any payments received by the Issuer and the Trustee
under the Joint Sharing Agreement.

      "Back-up Administration Agreement" shall mean the Back-up Administration
Agreement dated as of November 1, 2003 among the Issuer, the Administrator, the
Trustee and the Back-up Administrator as such agreement may be amended or
supplemented from time to time.

      "Back-up Administration Fee" shall mean the fees and expenses due to the
Back-up Administrator under the terms of the Back-up Administration Agreement;
provided, however, that such fees and expenses shall not in any one year exceed
the amounts set forth in the cashflows delivered to the Rating Agencies unless
the Issuer obtains a Rating Agency Confirmation.

         "Back-up Administrator" shall mean Lord Securities Corporation in its
capacity as back-up administrator under that certain Back-up Administration
Agreement, or any other person providing similar services and satisfying the
Rating Agency Confirmation.

      "Basic Documents" shall mean the Trust Agreement, this Indenture, any
Servicing Agreement, the Administration Agreement, the Student Loan Purchase
Agreements, the Custodian Agreements, the Guarantee Agreements, the Joint
Sharing Agreement, the Eligible Lender Trust Agreements, the Derivative Product
Agreements, the Auction Agent Agreement, the Broker-Dealer Agreements, the
Market Agent Agreements, the Back-up Administration Agreement and other
documents and certificates delivered in connection with any thereof.

      "BofA LIBOR Derivative Product Agreement" shall mean the ISDA Master
Agreement (including the schedule thereto), and the related Confirmation, Ref.
No. R3160873, dated November 12, 2003, between the Issuer and Bank of America,
N.A. (the "BofA Confirmation").

      "Business Day" shall mean (a) for purposes of calculating LIBOR, any day
on which the banks in New York, New York and London, England are open for the
transaction of international business and (b) for all other purposes, any day
other than December 30, December 31, April 14, April 15, such other dates as may
be agreed to in writing by the Market Agent, the Auction

                                       5
<PAGE>

Agent, the Broker-Dealer and the Issuer, or 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 Trustee or the Auction Agent, are authorized or permitted by law
or executive order to close.

      "Capitalized Interest Account" shall mean the Account by that name created
in Section 5.01(d) hereof and further described in Section 5.05 hereof

      "Carryover Servicing Fee" shall mean fees, if any, designated by the
Administrator as "Carryover Servicing Fees" in a written direction and as more
fully defined in the Master Servicing Agreement.

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

      "Certificate of Trust" shall mean the certificate filed with the Secretary
of State of Delaware establishing the Issuer as a statutory trust under Delaware
law.

      "Class A Auction Rate Notes" shall mean the Class A-3 Notes, the Class A-4
Notes, the Class A-5 Notes, the Class A-6 Notes and the Class A-7 Notes.

      "Class A Beneficiary" shall mean each Counterparty pursuant to its
Derivative Product Agreement and each Registered Owner of Class A Notes.

      "Class A Notes" shall mean, collectively, the Class A-1 Notes, the Class
A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class A-5 Notes, the
Class A-6 Notes and the Class A-7 Notes secured on a senior priority to the
Class B Obligations.

      "Class A Noteholders' Interest Distribution Amount" shall mean, for any
Auction Rate Distribution Date or Quarterly Distribution Date and a class of
Class A Notes, the Class A-1 Noteholders' Interest Distribution Amount, the
Class A-2 Noteholders' Interest Distribution Amount, the Class A-3 Noteholders'
Interest Distribution Amount, the Class A-4 Noteholders' Interest Distribution
Amount, the Class A-5 Noteholders' Interest Distribution Amount, the Class A-6
Noteholders' Interest Distribution Amount or the Class A-7 Noteholders' Interest
Distribution Amount, as applicable, in each case to the extent payable on such
Auction Rate Distribution Date or Quarterly Distribution Date.

      "Class A Obligations" shall mean Class A Notes and the Derivative Product
Agreements, the priority of payment of which is equal with that of Class A
Notes.

      "Class A-1 Maturity Date" shall mean the September 30, 2013 Quarterly
Distribution Date.

      "Class A-1 Note Interest Shortfall" shall mean, with respect to any
Quarterly Distribution Date, the excess, if any, of (a) the Class A-1
Noteholders' Interest Distribution Amount on the immediately preceding Quarterly
Distribution Date over (b) the amount of interest actually distributed to the
Class A-1 Noteholders on such preceding Quarterly Distribution Date, plus
interest on the amount of such excess interest due to the Class A-1 Noteholders,
to the extent

                                       6
<PAGE>

permitted by law, at the interest rate borne by the Class A-1 Notes from such
immediately preceding Quarterly Distribution Date to the current Quarterly
Distribution Date, as determined by the Trustee.

      "Class A-1 Noteholder" shall mean the Person in whose name a Class A-1
Note is registered in the Note registration books of the Trustee.

      "Class A-1 Noteholders' Interest Distribution Amount" shall mean, with
respect to any Quarterly Distribution Date, the sum of (a) the amount of
interest accrued at the Class A-1 Rate for the related Interest Accrual Period
on the aggregate outstanding principal balances of the Class A-1 Notes
immediately prior to such Quarterly Distribution Date; and (b) the Class A-1
Note Interest Shortfall for such Quarterly Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class A-1 Notes" shall mean the $249,000,000 Class A-1 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-1 hereto.

      "Class A-1 Rate" shall mean, for any Interest Accrual Period, other than
the first Interest Accrual Period, the applicable Three-Month LIBOR, plus 0.10%,
as determined by the Trustee on each LIBOR Determination Date. For the first
Interest Accrual Period, the Class A-1 Rate shall be determined by the Trustee
by reference to straight line interpolation between Four-Month and Five-Month
LIBOR, based on the actual number of days in the first Interest Accrual Period.

      "Class A-2 Maturity Date" shall mean the March 29, 2021 Quarterly
Distribution Date.

      "Class A-2 Note Interest Shortfall" shall mean, with respect to any
Quarterly Distribution Date, the excess, if any, of (a) the Class A-2
Noteholders' Interest Distribution Amount on the immediately preceding Quarterly
Distribution Date over (b) the amount of interest actually distributed to the
Class A-2 Noteholders on such preceding Quarterly Distribution Date, plus
interest on the amount of such excess interest due to the Class A-2 Noteholders,
to the extent permitted by law, at the interest rate borne by the Class A-2
Notes from such immediately preceding Quarterly Distribution Date to the current
Quarterly Distribution Date, as determined by the Trustee.

      "Class A-2 Noteholder" shall mean the Person in whose name a Class A-2
Note is registered in the Note registration books of the Trustee.

      "Class A-2 Noteholders' Interest Distribution Amount" shall mean, with
respect to any Quarterly Distribution Date, the sum of (a) the amount of
interest accrued at the Class A-2 Rate for the related Interest Accrual Period
on the aggregate outstanding principal balances of the Class A-2 Notes
immediately prior to such Quarterly Distribution Date; and (b) the Class A-2
Note Interest Shortfall for such Quarterly Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

                                       7
<PAGE>

      "Class A-2 Notes" shall mean the $250,000,000 Class A-2 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-2 hereto.

      "Class A-2 Rate" shall mean, for any Interest Accrual Period other than
the first Interest Accrual Period the Three-Month LIBOR for such Interest
Accrual Period plus 0.26%, as determined by the Trustee. For the first Interest
Accrual Period, the Class A-2 Rate shall be determined by the Trustee by
reference to straight line interpolation between Four-Month and Five-Month LIBOR
based on the actual number of days in the first Interest Accrual Period.

      "Class A-3 Carry-Over Amount" shall mean, for any Distribution Date
relating to the Class A-3 Notes, any unpaid Carry-Over Amounts with respect to
the Class A-3 Notes.

      "Class A-3 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

      "Class A-3 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class A-3 Notes, the excess, if any, of (a) the Class
A-3 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class A-3 Notes over (b) the amount of
interest actually distributed to the Class A-3 Noteholders on such immediately
preceding Auction Rate Distribution Date, plus interest accrued on the amount of
such interest due to the Class A-3 Noteholders, to the extent permitted by law,
at the Class A-3 Rate for the related Interest Accrual Period, from such
immediately preceding Auction Rate Distribution Date to the current Auction Rate
Distribution Date, as determined by the Trustee.

      "Class A-3 Noteholder" shall mean the Person in whose name a Class A-3
Note is registered on the Note registration books maintained by the Trustee.

      "Class A-3 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class A-3 Noteholders' Interest Distribution
Amount payable to the Class A-3 Notes on the Auction Rate Distribution Date for
the Class A-3 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class A-3 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class A-3 Notes.

      "Class A-3 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class A-3 Notes, the sum of (a) the
amount of interest accrued at the Class A-3 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class A-3
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class A-3 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class A-3 Notes" shall mean the $97,000,000 Class A-3 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

                                       8
<PAGE>

      "Class A-3 Rate" shall mean, for any Interest Accrual Period for the Class
A-3 Notes, other than the first Interest Accrual Period, the Auction Note
Interest Rate applicable to such class for such Interest Accrual Period, and for
the first Interest Accrual Period, the Initial Auction Rate for such class.

      "Class A-4 Carry-Over Amount" shall mean, for any Distribution Date
relating to the Class A-4 Notes, any unpaid Carry-Over Amounts with respect to
the Class A-4 Notes.

      "Class A-4 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

      "Class A-4 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class A-4 Notes, the excess, if any, of (a) the Class
A-4 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class A-4 Notes over (b) the amount of
interest actually distributed to the Class A-4 Noteholders on such immediately
preceding Auction Rate Distribution Date, plus interest accrued on the amount of
such interest due to the Class A-4 Noteholders, to the extent permitted by law,
at the Class A-4 Rate for the related Interest Accrual Period, from such
immediately preceding Auction Rate Distribution Date to the current Auction Rate
Distribution Date, as determined by the Trustee.

      "Class A-4 Noteholder" shall mean the Person in whose name a Class A-4
Note is registered on the Note registration books maintained by the Trustee.

      "Class A-4 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class A-4 Noteholders' Interest Distribution
Amount payable to the Class A-4 Notes on the Auction Rate Distribution Date for
the Class A-4 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class A-4 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class A-4 Notes.

      "Class A-4 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class A-4 Notes, the sum of (a) the
amount of interest accrued at the Class A-4 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class A-4
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class A-4 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class A-4 Notes" shall mean the $97,000,000 Class A-4 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

      "Class A-4 Rate" shall mean, for any Interest Accrual Period for the Class
A-4 Notes, other than the first Interest Accrual Period, the Auction Note
Interest Rate applicable to such class for such Interest Accrual Period, and for
the first Interest Accrual Period, the Initial Auction Rate for such class.

                                       9
<PAGE>

      "Class A-5 Carry-Over Amount" shall mean, for any Distribution Date
relating to the Class A-5 Notes, any unpaid Carry-Over Amount s with respect to
the Class A-5 Notes.

      "Class A-5 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

         "Class A-5 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class A-5 Notes, the excess, if any, of (a) the Class
A-5 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class A-5 Notes over (b) the amount of
interest actually distributed to the Class A-5 Noteholders on such immediately
preceding Auction Rate Distribution Date, plus interest accrued on the amount of
such interest due to the Class A-5 Noteholders, to the extent permitted by law,
at the Class A-5 Rate for the related Interest Accrual Period, from such
immediately preceding Auction Rate Distribution Date to the current Auction Rate
Distribution Date, as determined by the Trustee.

      "Class A-5 Noteholder" shall mean the Person in whose name a Class A-5
Note is registered on the Note registration books maintained by the Trustee.

      "Class A-5 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class A-5 Noteholders' Interest Distribution
Amount payable to the Class A-5 Notes on the Auction Rate Distribution Date for
the Class A-5 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class A-5 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class A-5 Notes.

      "Class A-5 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class A-5 Notes, the sum of (a) the
amount of interest accrued at the Class A-5 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class A-5
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class A-5 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class A-5 Notes" shall mean the $97,000,000 Class A-5 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

      "Class A-5 Rate" shall mean, for any Interest Accrual Period for the Class
A-5 Notes, other than the first Interest Accrual Period, the Auction Note
Interest Rate applicable to such class for such Interest Accrual Period, and for
the first Interest Accrual Period, the Initial Auction Rate for such class.

      "Class A-6 Carry-Over Amount" shall mean, for any Distribution Date
relating to the Class A-6 Notes, any unpaid Carry Over Amounts with respect to
the Class A-6 Notes.

      "Class A-6 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

                                       10
<PAGE>

      "Class A-6 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class A-6 Notes, the excess, if any, of (a) the Class
A-6 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class A-6 Notes over (b) the amount of
interest actually distributed to the Class A-6 Noteholders on such immediately
preceding Auction Rate Distribution Date, plus interest accrued on the amount of
such interest due to the Class A-6 Noteholders, to the extent permitted by law,
at the Class A-6 Rate for the related Interest Accrual Period, from such
immediately preceding Auction Rate Distribution Date to the current Auction Rate
Distribution Date, as determined by the Trustee.

      "Class A-6 Noteholder" shall mean the Person in whose name a Class A-6
Note is registered on the Note registration books maintained by the Trustee.

      "Class A-6 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class A-6 Noteholders' Interest Distribution
Amount payable to the Class A-6 Notes on the Auction Rate Distribution Date for
the Class A-6 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class A-6 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class A-6 Notes.

      "Class A-6 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class A-6 Notes, the sum of (a) the
amount of interest accrued at the Class A-6 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class A-6
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class A-6 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class A-6 Notes" shall mean the $97,000,000 Class A-6 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

      "Class A-6 Rate" shall mean, for any Interest Accrual Period for the Class
A-6 Notes, other than the first Interest Accrual Period, the Auction Note
Interest Rate applicable to such class for such Interest Accrual Period, and for
the first Interest Accrual Period, the Initial Auction Rate for such class.

      "Class A-7 Carry-Over Amount" shall mean, for any Distribution Date
relating to the Class A-7 Notes, any unpaid Carry Over Amounts with respect to
the Class A-7 Notes.

      "Class A-7 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

      "Class A-7 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class A-7 Notes, the excess, if any, of (a) the Class
A-7 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class A-7 Notes over (b) the amount of
interest actually distributed to the Class A-7 Noteholders on such immediately
preceding Auction Rate Distribution Date, plus interest accrued on the amount of
such interest due to the Class A-7 Noteholders, to the extent permitted by law,
at the Class A-

                                       11
<PAGE>

7 Rate for the related Interest Accrual Period, from such immediately preceding
Auction Rate Distribution Date to the current Auction Rate Distribution Date, as
determined by the Trustee.

      "Class A-7 Noteholder" shall mean the Person in whose name a Class A-7
Note is registered on the Note registration books maintained by the Trustee.

      "Class A-7 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class A-7 Noteholders' Interest Distribution
Amount payable to the Class A-7 Notes on the Auction Rate Distribution Date for
the Class A-7 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class A-7 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class A-7 Notes.

      "Class A-7 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class A-7 Notes, the sum of (a) the
amount of interest accrued at the Class A-7 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class A-7
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class A-7 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class A-7 Notes" shall mean the $97,000,000 Class A-7 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

      "Class A-7 Rate" shall mean, for any Interest Accrual Period for the Class
A-7 Notes, other than the first Interest Accrual Period, the Auction Note
Interest Rate applicable to such class for such Interest Accrual Period, and for
the first Interest Accrual Period, the Initial Auction Rate for such class.

      "Class B Auction Rate Notes" shall mean the Class B-1 Notes and the Class
B-2 Notes.

      "Class B Beneficiary" shall mean each Registered Owner of Class B Notes.

      "Class B Notes" shall mean, collectively, the Class B-1 Notes and the
Class B-2 Notes secured on a subordinate priority to the Class A Obligations.

      "Class B Noteholders' Interest Distribution Amount" shall mean, for any
Auction Rate Distribution Date or Quarterly Distribution Date and a class of
Class B Notes, the Class B-1 Noteholders' Interest Distribution Amount or the
Class B-2 Noteholders' Interest Distribution Amount, as applicable, in each case
to the extent payable on such Auction Rate Distribution Date or Quarterly
Distribution Date.

      "Class B Obligations" shall mean Class B Notes, the priority of payment of
which is subordinate to that of Class A Notes.

      "Class B-1 Carry-Over Amount" shall mean, for any Distribution Date, any
unpaid Carry-Over Amounts with respect to the Class B-1 Notes.

                                       12
<PAGE>

      "Class B-1 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

      "Class B-1 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class B-1 Notes, the excess, if any, of (a) the Class
B-1 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class B-1 Notes over (b) the amount of
interest actually distributed to the Class B-1 Noteholders on such immediately
preceding Auction Rate Distribution Date, plus interest accrued on the amount of
such interest due to the Class B-1 Noteholders, to the extent permitted by law,
at the Class B-1 Rate for the related Interest Accrual Period, from such
immediately preceding Auction Rate Distribution Date to the current Auction Rate
Distribution Date, as determined by the Trustee.

      "Class B-1 Noteholder" shall mean the Person in whose name a Class B-1
Note is registered on the Note registration books maintained by the Trustee.

      "Class B-1 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class B-1 Noteholders' Interest Distribution
Amount payable to the Class B-1 Notes on the Auction Rate Distribution Date for
the Class B-1 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class B-1 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class B-1 Notes.

      "Class B-1 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class B-1 Notes, the sum of (a) the
amount of interest accrued at the Class B-1 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class B-1
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class B-1 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class B-1 Notes" shall mean the $26,000,000 Class B-1 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

      "Class B-1 Rate" shall mean, for any Interest Accrual Period for the Class
B-1 Notes, other than the first Interest Accrual Period, the Auction Note
Interest Rate applicable to such class for such Interest Accrual Period, and for
the first Interest Accrual Period, the Initial Auction Rate for such class.

      "Class B-2 Carry-Over Amount" shall mean, for any Distribution Date, any
unpaid Carry-Over Amounts with respect to the Class B-2 Notes.

      "Class B-2 Maturity Date" shall mean the December 28, 2043 Quarterly
Distribution Date.

      "Class B-2 Note Interest Shortfall" shall mean, for each Auction Rate
Distribution Date for the Class B-2 Notes, the excess, if any, of (a) the Class
B-2 Noteholders' Interest Distribution Amount on the immediately preceding
Auction Rate Distribution Date for the Class B-2 Notes

                                       13
<PAGE>

over (b) the amount of interest actually distributed to the Class B-2
Noteholders on such immediately preceding Auction Rate Distribution Date, plus
interest accrued on the amount of such interest due to the Class B-2
Noteholders, to the extent permitted by law, at the Class B-2 Rate for the
related Interest Accrual Period, from such immediately preceding Auction Rate
Distribution Date to the current Auction Rate Distribution Date, as determined
by the Trustee.

      "Class B-2 Noteholder" shall mean the Person in whose name a Class B-2
Note is registered on the Note registration books maintained by the Trustee.

      "Class B-2 Noteholders' Accrued Interest Amount" shall mean, for each
Quarterly Distribution Date, the Class B-2 Noteholders' Interest Distribution
Amount payable to the Class B-2 Notes on the Auction Rate Distribution Date for
the Class B-2 Notes immediately following such Quarterly Distribution Date;
provided, however, the Class B-2 Noteholders' Accrued Interest Amount will be
zero for any Quarterly Distribution Date that is also an Auction Rate
Distribution Date for the Class B-2 Notes.

      "Class B-2 Noteholders' Interest Distribution Amount" shall mean, for each
Auction Rate Distribution Date for the Class B-2 Notes, the sum of (a) the
amount of interest accrued at the Class B-2 Rate for the related Interest
Accrual Period on the aggregate outstanding principal balance of the Class B-2
Notes immediately prior to such Auction Rate Distribution Date; and (b) the
Class B-2 Note Interest Shortfall for such Distribution Date, as based on the
actual number of days in such Interest Accrual Period divided by 360.

      "Class B-2 Notes" shall mean the $26,000,000 Class B-2 Student Loan
Asset-Backed Notes, Series 2003-B, issued by the Issuer pursuant to this
Indenture, substantially in the form of Exhibit B-3 hereto.

      "Class B-2 Rate" shall mean, for any Interest Accrual Period for the Class
B Notes, other than the first Interest Accrual Period, the Auction Note Interest
Rate applicable to such class for such Interest Accrual Period, and for the
first Interest Accrual Period, the Initial Auction Rate for such class.

      "Clearing Agency" shall mean an organization registered as a "clearing
agency" pursuant to Section 17A of the Exchange Act. The initial Clearing Agency
shall be The Depository Trust Company and the initial nominee for the Clearing
Agency shall be Cede & Co.

      "Clearing Agency Participant" shall mean a broker, dealer, bank, other
financial institution or other Person for whom from time to time a Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.

      "Closing Date" shall mean November 25, 2003.

      "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 which are applicable to the
Notes or the use of the proceeds thereof. A reference to any

                                       14
<PAGE>

specific section of the Code shall be deemed also to be a reference to the
comparable provisions of any enactment which supersedes or replaces the Code
thereunder from time to time.

      "Collection Fund" shall mean the Fund by that name created in Section
5.01(b) hereof and further described in Section 5.03 hereof.

      "Collection Period" shall mean, with respect to the first Quarterly
Distribution Date, the period beginning on the Closing Date and ending on
February 29, 2004, and with respect to each subsequent Quarterly Distribution
Date, the Collection Period means the three calendar months immediately
following the end of the previous Collection Period, beginning March 1, 2004.

      "Commission" shall mean the Securities and Exchange Commission.

      "Confirmation" shall mean (i) the BofA Confirmation, (ii) the JPMorgan
Confirmation and (iii) any other confirmation entered into pursuant to a
Derivative Product Agreement.

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

      "Counterparties" shall mean (i) the Initial Counterparties and their
respective successors and assigns and (ii) the counterparties to any Derivative
Product Agreements entered into pursuant to Section 3.03.

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

      "Custodian" shall mean CFS-SunTech Servicing LLC, as custodian pursuant to
the Custodian Agreement and its successors and assigns in such capacity, and any
other Person entering into a similar agreement and satisfying the Rating Agency
Confirmation.

      "Custodian Agreement" shall mean the Custodian Agreement, dated as of
November 1, 2003, among CFS-SunTech Servicing LLC, the Issuer and the Trustee.

      "Cutoff Date" shall mean (i) with respect to the initial pool of Financed
Eligible Loans, the Closing Date; and (ii) with respect to subsequently acquired
Eligible Loans, the date on which such Eligible Loans are transferred to the
Trust.

      "Delaware Trustee" shall mean Wilmington Trust Company, not in its
individual capacity but solely as trustee under the Trust Agreement, and its
successors and assigns in such capacity.

      "Delaware Trustee Fee" shall mean the annual administration fee set forth
in the Fee and Indemnity Agreement dated as of November 1, 2003 between the
Delaware Trustee and Collegiate Funding Services, L.L.C., payable on each
Quarterly Distribution Date, beginning on the March 2004 Quarterly Distribution
Date. Such fee shall not in any year exceed the amount set forth in the
cashflows delivered to the Rating Agencies unless the Issuer obtains a Rating
Agency Confirmation.

                                       15
<PAGE>

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

      "Derivative Product Agreements" shall mean (i) the LIBOR Derivative
Product Agreements and (ii) any other derivative product agreement entered into
pursuant to Section 3.03 hereof.

      "Derivative Value" shall mean the value of a Derivative Product Agreement,
if any, to the Counterparty, provided that such value is defined and calculated
as provided in the applicable provisions of such Derivative Product Agreement.

      "Distribution Date" shall mean (i) for an Auction Rate Note, each related
Auction Rate Distribution Date and (ii) for a LIBOR-Rate Note and, to the extent
specified herein with respect to certain amounts owed under the Auction Rate
Notes and to other parties, each Quarterly Distribution Date.

      "Eligible Lender" shall mean (i) the Eligible Lender Trustee and (ii) any
"eligible lender," as defined in the Act, and which has received an eligible
lender designation from the Secretary with respect to Eligible Loans made under
the Act.

      "Eligible Lender Trust Agreements" shall mean (i) the Issuer Eligible
Lender Trust Agreement, (ii) the Eligible Lender Trust Agreement, dated as of
February 1, 2003, between the Sponsor, as grantor, and the Eligible Lender
Trustee, as eligible lender trustee, and (iii) any similar agreement entered
into by the Issuer or the Sponsor and an "eligible lender" under the Higher
Education Act pursuant to which such "eligible lender" holds Financed Eligible
Loans as legal owner in trust for the Issuer or the Sponsor as beneficial owner,
in each case as supplemented or amended from time to time.

      "Eligible Lender Trustee" shall mean U.S. Bank National Association, as
trustee under the Eligible Lender Trust Agreements and this Agreement, and its
successors and assigns in such capacity.

      "Eligible Loan" shall mean any consolidation loan or Add-On Loan made to a
borrower for or in connection with post-secondary education that is originated
pursuant to Section 528C of the Act.

      "Eligible Loan Acquisition Certificate" shall mean a certificate signed by
an Authorized Representative of the Issuer in substantially the form attached as
Exhibit A hereto.

      "ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
amended.

      "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

                                       16
<PAGE>

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 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.

      "Event of Default" shall have the meaning specified in Article VI hereof.

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

      "Final Maturity Date" for a class of Notes shall mean the Class A-1
Maturity Date, the Class A-2 Maturity Date, the Class A-3 Maturity Date, the
Class A-4 Maturity Date, the Class A-5 Maturity Date, the Class A-6 Maturity
Date, the Class A-7 Maturity Date, the Class B-1 Maturity Date or the Class B-2
Maturity Date, as applicable.

      "Financed" or "Financing" when used with respect to Eligible Loans or
Student Loans, shall mean or refer to Eligible Loans or 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) Eligible Loans or Student Loans substituted
or exchanged for Financed Eligible Loans or Student Loans, but does not include
Eligible Loans or Student Loans released from the lien of this Indenture and
sold or transferred, to the extent permitted by this Indenture.

      "Fiscal Year" shall mean the fiscal year of the Issuer (initially January
1 to December 31) as otherwise established from time to time.

      "Five-Month LIBOR" see "One-Month LIBOR" herein.

      "Four-Month LIBOR" see "One-Month LIBOR" herein.

      "Funds" shall mean each of the Funds and Accounts created pursuant to
Sections 5.01 hereof.

      "Guarantee" or "Guaranteed" shall mean, with respect to an Eligible 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 Eligible Loan allowed by the terms of the Act with
respect to such Eligible Loan at the time it was originated and the coverage of
such Eligible Loan by the federal reimbursement contracts, providing, among
other things, for reimbursement to the Guaranty Agency for payments made by it
on defaulted Eligible Loans insured or guaranteed by the Guaranty Agency of at
least the minimum reimbursement allowed by the Act with respect to a particular
Eligible Loan.

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

                                       17
<PAGE>

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

      "H.15(519)" shall mean the weekly statistical release designated as such,
or any successor publication, published by the Board of Governors of the United
States Federal Reserve System.

      "H.15 Daily Update" shall mean the daily update for H.15 (519), available
through the world wide web site of the Board of Governors of the Federal Reserve
System at http://www.federalreserve.gov/releases/h15/update, or any successor
site or publications.

      "Highest Priority Obligations" shall mean at any time when Class A
Obligations are Outstanding, the Class A Obligations and at any time when no
Class A Obligations are Outstanding, the Class B Obligations.

      "Indenture" shall mean this Indenture of Trust, including any supplement
hereto or amendment hereof entered into in accordance with the provisions
hereof.

      "Independent" shall mean, when used with respect to any specified Person,
that the Person (a) is in fact independent of the Trust, 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 Trust, any such other obligor, the Seller or any Affiliate of
any of the foregoing Persons; and (c) is not connected with the Trust, any such
other obligor, the Seller or any Affiliate of any of the foregoing Persons as an
officer, employee, promoter, underwriter, placement agent, trustee, partner,
director or person performing similar functions.

      "Independent Certificate" shall mean a certificate or opinion to be
delivered to the Trustee under the circumstances described in, and otherwise
complying with, the applicable requirements of the Indenture, made by an
Independent appraiser or other expert appointed by an Issuer Order and approved
by the Trustee in the exercise of reasonable care, and such opinion or
certificate shall state that the signer has read the definition of "Independent"
in the Indenture and that the signer is Independent within the meaning thereof.

      "Index Maturity" shall mean (i) for One-Month LIBOR, one month, (ii) for
Three-Month LIBOR, three months, (iii) for Four-Month LIBOR, four months and
(iv) for Five-Month LIBOR, five months, (v) for Six-Month LIBOR, six months and
(vi) for One-Year LIBOR, one year.

      "Initial Counterparties" shall (i) mean Bank of America, N.A., as
counterparty pursuant to the BofA LIBOR Derivative Product Agreement and (ii) JP
Morgan Chase Bank, as counterparty pursuant to the JP Morgan LIBOR Derivative
Product Agreement.

      "Initial Pool Balance" shall mean the Pool Balance as of the initial
Cutoff Date, which is $795,620,185.15.

                                       18
<PAGE>

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

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

      "Interest Accrual Period" shall mean (i) with respect to each class of
LIBOR-Rate Notes, initially, the period commencing on the Closing Date to but
not including the first Quarterly Distribution Date, and thereafter, with
respect to each Quarterly Distribution Date, the period beginning on the prior
Quarterly Distribution Date and ending on the day immediately preceding such
Quarterly Distribution Date and (ii) with respect to each class of Auction Rate
Notes, the period described as such in Annex 1 hereto.

      "Investment Securities" shall mean:

                  (i)   direct obligations of, or obligations on which the
            timely payment of the principal of and interest on which are
            unconditionally and fully guaranteed by, the United States of
            America;

                  (ii)  interest-bearing time or demand deposits, certificates
            of deposit or other similar banking arrangements with a maturity of
            12 months or less with any bank, trust company, national banking
            association or other depository institution, including those of the
            Trustee, provided that, at the time of deposit or purchase such
            depository institution has commercial paper which is rated "A-1+" by
            S&P and "P-1" by Moody's;

                  (iii) bonds, debentures, notes or other evidences of
            indebtedness issued or guaranteed by any of the following agencies:
            Federal Farm Credit Banks, Federal Home Loan Mortgage Corporation;
            the Export-Import Bank of the United States; the Federal National
            Mortgage Association; the Student Loan Marketing Association; the
            Farmers Home Administration; Federal Home Loan Banks provided such
            obligation is rated "AAA" by S&P and "Aaa" by Moody's; or any agency
            or instrumentality of the United States of America which shall be
            established for the purposes of acquiring the obligations of any of
            the foregoing or otherwise providing financing therefor;

                  (iv)  repurchase agreements and reverse repurchase agreements,
            other than overnight repurchase agreements and overnight reverse
            repurchase agreements, with banks, including the Trustee and any of
            its affiliates, which are members of the Federal Deposit Insurance
            Corporation or firms which are members of the Securities Investors
            Protection Corporation, in each case whose outstanding, unsecured
            debt securities are rated "A" or higher by S&P and "Aa3" or higher
            by Moody's (if such depository institution does not have commercial
            paper rated by Moody's ) or "A1" or higher (if such depository
            institution has commercial paper which is rated "P-1" by Moody's ),
            and, if commercial paper is

                                       19
<PAGE>

            outstanding, commercial paper which is rated "A-1+" by S&P and "P-1"
            by Moody's;

                  (v)   overnight repurchase agreements and overnight reverse
            repurchase agreements with a Rating Agency Confirmation from each
            Rating Agency;

                  (vi)  investment agreements or guaranteed investment
            contracts, which may be entered into by and among the Issuer and/or
            the Trustee and any bank, bank holding company, corporation or any
            other financial institution, including the Trustee and any of its
            affiliates, whose outstanding (i) commercial paper is rated "A-1+"
            by S&P and "P-1" by Moody's for agreements or contracts with a
            maturity of 12 months or less; (ii) unsecured long-term debt is
            rated no lower than two subcategories below the highest rating on
            any series of Outstanding Notes by S&P and Moody's and, if
            commercial paper is outstanding, commercial paper which is rated
            "A-1+" by S&P and "P-1" by Moody's for agreements or contracts with
            a maturity of 24 months or less, but more than 12 months, or (iii)
            unsecured long-term debt which is rated no lower than two
            subcategories below the highest rating on any series of Outstanding
            Notes by S&P and Moody's (if such depository institution does not
            have commercial paper rated by Moody's ) or "A1" or higher (if such
            depository institution has commercial paper which is rated "P-1" by
            Moody's ), and, if commercial paper is outstanding, commercial paper
            which is rated "A-1+" by S&P and "P-1" by Moody's for agreements or
            contracts with a maturity of more than 24 months, or, in each case,
            by an insurance company whose claims-paying ability is so rated;

                  (vii) "tax exempt bonds" as defined in Section 150(a)(6) of
            the Code, other than "specified private activity bonds" as defined
            in Section 57(a)(5)(C) of the Code, that are rated in the highest
            category by S&P and Moody's for long-term or short-term debt or
            shares of a so-called money market or mutual fund rated
            "AAAm/AAAm-G" or higher by S&P and "Aaa" or higher by Moody's, that
            do not constitute "investment property" within the meaning of
            Section 148(b)(2) of the Code, provided that the fund has all of its
            assets invested in obligations of such rating quality;

                  (viii) commercial paper, including that of the Trustee and any
            of its affiliates, which is rated in the single highest
            classification, "A-1+" by S&P and "P-1" by Moody's, and which
            matures not more than 270 days after the date of purchase;

                  (ix)  investments in a money market fund rated at least "AAAm"
            or "AAAm-G" by S&P and "Aaa" by Moody's, including funds for which
            the Trustee or an affiliate thereof acts as investment advisor or
            provides other similar services for a fee; and

                  (x)   any other investment with a Rating Agency Confirmation
            from each Rating Agency.

                                       20
<PAGE>

      "ISDA Master Agreement" shall mean the ISDA Master Agreement, copyright
1992, as amended from time to time, and as in effect with respect to any
Derivative Product Agreement.

      "Issuer" shall mean Collegiate Funding Services Education Loan Trust
2003-B, a Delaware statutory trust, and any successor or assignee thereto under
this Indenture.

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

      "Issuer Eligible Lender Trust Agreement" shall mean the Eligible Lender
Trust Agreement dated as of November 1, 2003, between the Issuer and the
Eligible Lender Trustee, as supplemented or amended from time to time.

      "Issuer Order" shall mean a written order signed in the name of the Issuer
by an Authorized Representative.

      "Joint Sharing Agreement" shall mean the Joint Sharing Agreement, dated as
of February 1, 2003, among the Joint Sharing Agreement Parties, as amended to
add, or as executed by, the Issuer and the Trustee, as eligible lender trustee
for the Issuer.

      "Joint Sharing Agreement Parties" shall mean Collegiate Funding Services
Education Loan Trust I, Collegiate Funding Services Education Loan Trust 2003-A
and U.S. Bank National Association, as eligible lender trustee and any other
parties from time to time party to the Joint Sharing Agreement.

      "JP Morgan LIBOR Derivative Product Agreement" shall mean the ISDA Master
Agreement (including the schedule thereto), and the related Confirmation, Ref.
No. R000272546/67095493, dated November 12, 2003, between the Issuer and
JPMorgan Chase Bank (the "JPMorgan Confirmation").

      "LIBOR" shall mean One-Month LIBOR, Three-Month LIBOR, Four-Month LIBOR,
Five-Month LIBOR, Six-Month LIBOR or One-Year LIBOR, as applicable.

      "LIBOR Derivative Product Agreements" shall mean, collectively, the BofA
LIBOR Derivative Product Agreement and the JP Morgan Derivative Product
Agreement.

      "LIBOR Determination Date" shall mean, for each Interest Accrual Period,
the second Business Day before the beginning of that Interest Accrual Period.

      "LIBOR-Rate Notes" shall mean the Class A-1 Notes and the Class A-2 Notes.

      "Liquidated Financed Eligible Loan" shall mean any defaulted Financed
Eligible Loan liquidated by the Servicer (which shall not include any Financed
Eligible Loan on which payments are received from a Guaranty Agency) or which
the Servicer has, after using all reasonable efforts to realize upon such
Financed Eligible Loan, determined to charge off.

                                       21
<PAGE>

      "Liquidation Proceeds" shall mean, with respect to any Liquidated Financed
Eligible Loan which became a Liquidated Financed Eligible Loan during the
current Collection Period in accordance with the Servicer's customary servicing
procedures, the moneys collected in respect of the liquidation thereof from
whatever source, other than moneys collected with respect to any Liquidated
Financed Eligible Loan which was written off in prior Collection Periods or
during the current Collection Period, net of the sum of any amounts expended by
the Servicer in connection with such liquidation and any amounts required by law
to be remitted to the obligor on such Liquidated Financed Eligible Loan.

      "Master Promissory Note" shall mean a Master Promissory Note in the form
mandated by Section 432(m)(1) of the Higher Education Act, as added by Pub. L.
105-244 Section 427, 112 Stat. 1702 (1998), as amended by Public Law No: 106-554
(enacted December 21, 2000) and as codified in 20 U.S.C. Section 1082(m)(1).

      "Master Servicer" shall mean Collegiate Funding Master Servicing, L.L.C.,
as master servicer pursuant to the Master Servicing Agreement.

      "Master Servicing Agreement" shall mean the Master Servicing Agreement
dated as of November 1, 2003, between the Issuer and Collegiate Funding Master
Servicing, L.L.C., as master servicer, as supplemented and amended from time to
time.

      "Material Adverse Effect" shall mean (1) any change in the Termination
Date (as defined in a relevant Derivative Product Agreement) or the due date for
any payment required to be made by the Issuer to the Counterparty pursuant to
the terms of the relevant Derivative Product Agreement, or any change to the
Notional Amount (as defined in the relevant Derivative Product Agreement) other
than as contemplated pursuant to the terms of the relevant Derivative Product
Agreement or any change to the Fixed Rate Payer Notional Amount or the Fixed
Rate or the Floating Rate Payer Notional Amount or the Floating Rate or the
Spread (each as defined in the Derivative Product Agreement) or any other amount
payable under the relevant Derivative Product Agreement, or any change in the
priority of the payments to be made to the Counterparty by the Issuer (subject
to the priority of payment provisions of the Indenture); (2) a change in the
right of the Counterparty to consent to supplemental indentures and (3) any
change to the definition of Material Adverse Effect or any change in the
definition of term (whether used directly or indirectly) used in any provision
described in the foregoing Clauses (1) or(2).

      "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 Final Maturity Date, by earlier prepayment or purchase,
by declaration of acceleration, or otherwise.

      "Minimum Purchase Amount" shall mean, on any Quarterly Distribution Date,
an amount that would be sufficient to (a) reduce the Outstanding Amount of each
class of Notes on such Quarterly Distribution Date to zero; (b) pay to the
respective Registered Owners the Class A Noteholders' Interest Distribution
Amount and the Class B Noteholders' Interest Distribution Amount payable on such
Quarterly Distribution Date; (c) pay any Servicing Fees and Carryover Servicing
Fees due and owing; (d) pay any Issuer Derivative Payments due and owing; and
(e) in the case of the Auction Rate Notes, pay any Carry-Over Amounts and
interest on such amounts.

                                       22
<PAGE>

      "Monthly Payment Date" shall mean the 28th day of each calendar month or,
if such day is not a Business Day, the immediately succeeding Business Day,
commencing in December 2003.

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

      "MPN Loan" shall mean a loan originated pursuant to the Federal Family
Education Loan Program and the Act and evidenced by a Master Promissory Note.

      "Noteholder" shall mean the Person in whose name a Note is registered in
the Note registration books of the Trustee.

      "Note Rates" shall mean, with respect to any Interest Accrual Period, the
Class A-1 Rate, the Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the
Class A-5 Rate, the Class A-6 Rate, the Class A-7 Rate, the Class B-1 Rate and
the Class B-2 Rate for such Interest Accrual Period, respectively.

      "Notes" shall mean, collectively, the Class A Notes and the Class B Notes.

      "Obligations" shall mean Class A Obligations and Class B Obligations.

      "One-Month LIBOR," "Three-Month LIBOR," "Four-Month LIBOR," "Five-Month
LIBOR," "Six-Month LIBOR" and "One-Year LIBOR" shall mean, with respect to any
Interest Accrual Period, the London interbank offered rate for deposits in U.S.
dollars having the applicable Index Maturity as it appears on Telerate Page 3750
as of 11:00 a.m., London time, on the related LIBOR Determination Date as
determined by, in the case of the LIBOR-Rate Notes, the Trustee, and in the case
of the Auction Rate Notes, the Auction Agent or the Trustee, as applicable. If
this rate does not appear on Telerate Page 3750, the rate for that day will be
determined on the basis of the rates at which deposits in U.S. dollars, having
the index maturity and in a principal amount of not less than U.S. $1,000,000,
are offered at approximately 11:00 a.m., London time, on that LIBOR
Determination Date, to prime banks in the London interbank market by the
Reference Banks. The Trustee or the Auction Agent, as applicable, will request
the principal London office of each Reference Bank to provide a quotation of its
rate. If the Reference Banks provide at least two quotations, the rate for that
day will be the arithmetic mean of the quotations. If the Reference Banks
provide fewer than two quotations, the rate for that day will be the arithmetic
mean of the rates quoted by major banks in New York City, selected by the
Trustee or the Auction Agent, as applicable, at approximately 11:00 a.m., New
York time, on that LIBOR Determination Date, for loans in U.S. dollars to
leading European banks having the Index Maturity and in a principal amount of
not less than U.S. $1,000,000. If the banks selected as described above are not
providing quotations, One-Month-LIBOR, Three-Month LIBOR, Four-Month LIBOR,
Five-Month LIBOR, Six-Month LIBOR or One-Year LIBOR, as the case may be, in
effect for the applicable Interest Accrual Period will be in effect for the
previous Interest Accrual Period.

      "One-Year LIBOR" see "One-Month LIBOR" herein.

                                       23
<PAGE>

      "Opinion of Counsel" shall mean (a) with respect to the Trust, one or more
written opinions of counsel who may, except as otherwise expressly provided in
the Indenture, be employees of or counsel to the Delaware Trustee, the Trust,
the Seller or an Affiliate of the Seller and who shall be satisfactory to the
Trustee, and which opinion or opinions shall be addressed to the Trustee as
Trustee, shall comply with any applicable requirements of the TIA and shall be
in form and substance satisfactory to the Trustee; and (b) with respect to the
Seller, the Administrator or the Servicer, one or more written opinions of
counsel who may be an employee of or counsel to the Seller, the Administrator or
the Servicer, which counsel shall be acceptable to the Trustee and the Delaware
Trustee.

      "Optional Purchase Date" shall have the meaning set forth in Section 10.03
hereof.

      "Outstanding" shall mean, when used in connection with any Note, a Note
which has been executed and delivered pursuant to this Indenture which at such
time remains unpaid as to principal or interest, excluding Notes which have been
replaced pursuant to Section 2.03 hereof , and when used in connection with a
Derivative Product Agreement, a Derivative Product Agreement which has not
expired or been terminated, unless provision has been made for such payment
pursuant to Section 10.02 hereof.

      "Outstanding Amount" shall mean the aggregate principal amount of all
Notes Outstanding at the date of determination or, if the context so requires,
the aggregate principal amount of one or more classes of Class A Notes
Outstanding at the date of determination.

      "Person" shall mean an individual, corporation, partnership, joint
venture, association, joint stock company, trust, limited liability company,
unincorporated organization or government or agency, or political subdivision
thereof.

      "Pool Balance" shall mean as of any date the aggregate principal balance
of the Financed Eligible Loans on such date (including accrued interest thereon
that is expected to be capitalized), plus amounts on deposit in the Acquisition
Fund, as reduced by the principal portion of the following, without duplication:
(a) all payments received by the Issuer through such date from or on behalf of
borrowers on such Financed Eligible Loans, including payments by Guaranty
Agencies and the Department; (b) all Purchase Amounts on Financed Eligible Loans
received by the Issuer through such date from the Seller or the Servicer; (c)
all Liquidation Proceeds and Realized Losses on Financed Eligible Loans
liquidated through such date; (d) the aggregate amount of adjustments to
balances of Financed Eligible Loans permitted to be effected by a Servicer under
a Servicing Agreement, if any, recorded through such date; and (e) the aggregate
amount by which reimbursements by Guarantors of the unpaid principal balance of
defaulted Financed Eligible Loans through such date are reduced from 100% to 98%
or other applicable percentage, as required by the risk sharing provisions of
the Act. The Pool Balance shall be calculated by the Administrator and certified
to the Trustee, upon which the Trustee may conclusively rely with no duty to
further examine or determine such information.

      "Principal Distribution Amount" shall mean, with respect to each Quarterly
Distribution Date, the amount by which the Outstanding Amount of the Notes
immediately prior to such Quarterly Distribution Date exceeds the quotient
obtained by dividing the Adjusted Pool Balance as of the last day of the related
Collection Period by 100.75%. For the initial Quarterly

                                       24
<PAGE>

Distribution Date, the "Principal Distribution Amount" also will include any
amounts transferred from the Acquisition Fund to the Collection Fund during the
initial Collection Period. Further, on the Final Maturity Date for a class of
Notes, the Principal Distribution Amount on that date also shall include the
amount needed to reduce the Outstanding principal amount of such class of Notes
to zero.

      "Principal Office" shall mean the principal office of the party indicated,
as set forth in Section 9.01 hereof or elsewhere in this Indenture.

      "Priority Termination Payment" shall mean, with respect to a Derivative
Product Agreement, any termination payment payable by the Issuer under such
Derivative Product Agreement relating to an early termination of such Derivative
Product Agreement by the Counterparty, as the non-defaulting party, following
(i) a monthly payment default by the Issuer thereunder, (ii) the occurrence of
an Event of Default specified in Section 6.01(d) of this Indenture or (iii) the
Trustee's taking any action hereunder to liquidate the Trust Estate following an
Event of Default and acceleration of the Notes pursuant to Section 6.04 hereof.

      "Program" shall mean the Sponsor's program for the origination and the
purchase of Eligible Loans, as the same may be modified from time to time.

      "Purchase Amount" with respect to any Financed Eligible Loan shall mean
the amount required to prepay in full such Financed Eligible Loan under the
terms thereof including all accrued interest thereon and any unamortized
premium, it being acknowledged that any accrued and unpaid Interest Subsidy
Payments or Special Allowance Payments will continue to be payable to the
Trustee and constitute part of the Trust Estate.

      "Quarterly Distribution Date" shall mean the 28th day of each March, June,
September and December (or, if any such day is not a Business Day, the
immediately following Business Day), commencing in March 2004.

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

      "Rating Agency" shall mean each of Moody's and S&P and their successors
and assigns or any other rating agency requested by the Issuer to maintain a
Rating on any of the Notes.

      "Rating Agency Confirmation" shall mean a letter from each Rating Agency
then providing a Rating for any of the Notes, confirming that a proposed action,
failure to act, or other event specified therein 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, withdraw or qualify the Ratings then
applicable to the Notes.

      "Realized Loss" shall mean the excess of the principal balance (including
any interest that had been or had been expected to be capitalized) of any
Liquidated Financed Eligible Loan over Liquidation Proceeds with respect to such
Financed Eligible Loan to the extent allocable to principal (including any
interest that had been or had been expected to be capitalized).

                                       25
<PAGE>

      "Record Date" shall mean, with respect to a Distribution Date, the
Business Day immediately preceding such Distribution Date.

      "Reference Banks" shall mean, with respect to a determination of LIBOR for
any Interest Accrual Period by the Trustee or the Auction Agent, as applicable,
four major banks in the London interbank market selected by the Trustee or the
Auction Agent, as applicable.

      "Registered Owner" shall mean any Noteholder, except that, solely for the
purpose of giving any consent pursuant to this Indenture, any Note registered in
the name of the Sponsor or any affiliate of the Sponsor shall be deemed not to
be Outstanding and the Outstanding Amount evidenced thereby shall not be taken
into account in determining whether the requisite principal amount of
Obligations necessary to effect such consent has been obtained unless at the
time the Sponsor and its affiliates own all of the Notes that are Outstanding.

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

      "Remaining Acquisition Amount" shall mean the excess, if any, of (i) the
amount deposited into the Acquisition Fund on the Closing Date over (ii) the sum
of all amounts withdrawn from the Acquisition Fund up until such date.

      "Reserve Fund" shall mean the Fund by that name created in Section 5.01(c)
hereof and further described in Section 5.04 hereof, including any Accounts and
Subaccounts created therein.

      "Reserve Fund Requirement" shall mean, at any time, an amount equal to the
greater of (i) 0.75% of the Pool Balance, as of the close of business on the
last day of the related Collection Period; and (ii) $994,539.

      "S&P" shall mean Standard & Poor's Ratings Services, a division of The
McGraw-Hill Companies, Inc., its successors and assigns.

      "Secretary" shall mean the Secretary of the United States Department of
Education or any successor to the pertinent functions thereof under the Act.

      "Securities Act" shall mean the 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
which agrees to follow the procedures required to be followed by a securities
depository in connection with the Notes and which is selected by the Issuer with
the consent of the Trustee.

      "Seller" shall mean Collegiate Funding of Delaware, L.L.C., and its
successors and assigns.

                                       26
<PAGE>

      "Servicer" shall mean Collegiate Funding Master Servicing, L.L.C., and any
other additional servicer or successor servicer or subservicer selected by the
Issuer, including an affiliate of the Issuer, so long as the Issuer obtains a
Rating Agency Confirmation as to each such other servicer.

      "Servicer's Report" shall mean the servicer reports to be furnished to the
Issuer by the Master Servicer quarterly pursuant to the Master Servicing
Agreement, substantially in the form of Exhibit E hereto.

      "Servicing Agreement" shall mean (i) the Master Servicing Agreement and
(ii) any servicing agreement between the Issuer and any Servicer (or among the
Issuer, the Eligible Lender Trustee and any Servicer), under which such Servicer
agrees to act as the Issuer's agent in connection with the administration and
collection of Financed Eligible Loans in accordance with this Indenture.

      "Servicing Fees" shall mean the fees and expenses due to the Master
Servicer under the terms of the Master Servicing Agreement and the fees and
expenses due to any custodian under the terms of a Custodian Agreement;
provided, however, that such fees and expenses shall not in any year exceed the
amounts set forth in the cashflows delivered to the Rating Agencies unless the
Issuer obtains a Rating Agency Confirmation.

      "Six-Month LIBOR" see "One-Month LIBOR" herein.

      "Special Allowance Payments" shall mean the special allowance payments
authorized to be made by the Secretary by Section 438 of the Act, or similar
allowances, if any, authorized from time to time by federal law or regulation.

      "Sponsor" shall mean Collegiate Funding of Delaware, L.L.C., and its
successors and assigns and any other Person or Persons as may become a Sponsor
pursuant to the terms of the Trust Agreement.

      "State" shall mean the State of Delaware.

      "Student Loan" shall mean an Eligible Loan.

      "Student Loan Purchase Agreements" shall mean (a) the FFELP Loan Purchase
Agreement, dated as of November 1, 2003, among the Issuer, the Seller,
Collegiate Funding Services, L.L.C. and the Eligible Lender Trustee, (b) the
FFELP Loan Purchase Agreement, dated as of November 1, 2003, among the Seller,
Collegiate Funding Services Resources I, LLC, Collegiate Funding Services,
L.L.C. and U.S. Bank National Association, as eligible lender trustee, and (c)
each additional student loan purchase agreement, if any, entered into among the
Issuer, the Seller and the Eligible Lender Trustee for the purchase of Eligible
Loans which constitute "Add-On Loans."

      "Subaccount" shall mean any of the subaccounts which may be created and
established within any Account by this Indenture.

                                       27
<PAGE>

      "Supplemental Indenture" shall mean an agreement supplemental hereto
executed pursuant to Article VIII hereof.

      "Telerate Page 3750" shall mean the display page so designated on the
Telerate Service (or such other page as may replace that page on that service
for the purpose of displaying comparable rates or prices).

      "Termination Payment" shall mean, with respect to a Derivative Product
Agreement, any termination payment payable by the Issuer under such Derivative
Product Agreement relating to an early termination of such Derivative Product
Agreement, after the occurrence of a termination event or event of default
specified in such Derivative Product Agreement, including any Priority
Termination Payment.

      "Three-Month LIBOR" see "One-Month LIBOR" herein.

      "Trust" shall mean the Issuer.

      "Trust Agreement" shall mean the Trust Agreement dated as of November 1,
2003, as amended and restated by the Amended and Restated Trust Agreement dated
as of November 1, 2003, each between the Delaware Trustee and the Sponsor, as
the same may be amended from time to time.

      "Trust Auction Date" shall have the naming set forth in Section 10.04
hereof.

      "Trust Estate" shall mean the property described as such in the granting
clauses hereto.

      "Trust Indenture Act" or "TIA" shall mean the Trust Indenture Act of 1939,
as amended, and as in force at the date as of which this Indenture was executed,
except as provided in Section 8.05.

      "Trustee" shall mean U.S. Bank National Association, acting in its
capacity as Trustee under this Indenture, or any successor trustee designated
pursuant to this Indenture.

      "Trustee Fee" shall mean an amount equal to the annual amount set forth in
the Trustee Fee Letter dated as of November 1, 2003, payable in installments on
each Quarterly Distribution Date. Such fee shall be in satisfaction of the
Trustee's compensation as trustee under this Indenture and as eligible lender
trustee under the Eligible Lender Trust Agreements. Such fee shall not in any
year exceed the amounts set forth in the cashflows delivered to the Rating
Agencies unless the Issuer obtains a Rating Agency Confirmation.

      Words importing the masculine gender include the feminine gender, and
words importing the feminine gender include the masculine 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 Indenture.

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<PAGE>

                                   ARTICLE II

                         NOTE DETAILS AND FORM OF NOTES

      SECTION 2.01 NOTE DETAILS. The Notes, together with the Trustee's
certificate of authentication, shall be in substantially the forms set forth in
Exhibit B, with such appropriate insertions, omissions, substitutions and other
variations as are required or permitted by this Indenture and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may, consistently herewith, be determined by the
officers executing the Notes, as evidenced by their execution of the Notes. Any
portion of the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.

      The definitive Notes shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the Authorized Representatives executing
such Notes, as evidenced by their execution of such Notes.

      Each Note shall be dated the date of its authentication. The terms of the
Notes set forth in Exhibit B are part of the terms of this Indenture.

      SECTION 2.02 EXECUTION, AUTHENTICATION AND DELIVERY OF NOTES. The Notes
shall be executed in the name and on behalf of the Issuer by the manual or
facsimile signature of an Authorized Representative. 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 or position,
notwithstanding that at the date of authentication, issuance or delivery, such
person may have ceased to hold such office or position.

      The Trustee shall upon Issuer Order authenticate and deliver Notes for
original issue in an aggregate principal amount of $1,036,000,000. The aggregate
principal amount of Notes outstanding at any time may not exceed such amount
except as provided in Section 2.04 hereof.

      Each Note shall be dated the date of its authentication. The Notes shall
be issuable as registered Notes, in the case of the LIBOR-Rate Notes, in minimum
denominations of $50,000 and in integral multiples of $1,000 in excess thereof
and, in the case of the Auction Rate Notes, in minimum denominations of $50,000
and integral multiples of $50,000 in excess thereof.

      No Note shall be entitled to any benefit under this Indenture or be valid
or obligatory for any purpose, unless there appears on such Note a certificate
of authentication substantially in the form provided for in Section 2.05 hereof.

      SECTION 2.03 REGISTRATION, TRANSFER AND EXCHANGE OF NOTES; PERSONS TREATED
AS REGISTERED OWNERS. 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
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 Trustee is hereby authorized to make any arrangements with other
institutions which it deems necessary or desirable in order that such
institutions may

                                       29
<PAGE>

perform the duties of transfer agent for the Notes. Upon surrender for transfer
of any Note at the Principal Office of the Trustee, duly endorsed for transfer
or accompanied by an assignment duly executed by the Registered Owner or his
attorney duly authorized in writing, the Issuer shall execute and the Trustee
shall authenticate and deliver 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 Principal Office of the 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 Trustee shall authenticate and deliver Notes which
the Registered Owner 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 Trustee shall thereby be authorized
to authenticate and deliver such fully registered Note.

      As to any Note, the person in whose name the same shall be 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 Registered Owner thereof or his
legal representative but such registration may be changed as hereinabove
provided. 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.

      Each Registered Owner and each transferee of a Note shall be deemed to
represent and warrant that either (a) it is not acquiring the Note directly or
indirectly for, or on behalf of, an ERISA plan or any entity whose underlying
assets are deemed to be plan assets of such ERISA plan; or (b) (i) the
acquisition and holding of the Notes will not result in a nonexempt prohibited
transaction under Section 406 of ERISA or Section 4975 of the Code or similar
law and (ii) if the Notes are subsequently deemed to be "plan assets" pursuant
to the regulations set forth at 29 C.F.R. Section 2510.3-101, it will promptly
dispose of the Notes.

      The Trustee shall require the payment by any Registered Owner requesting
exchange or transfer of any tax or other governmental charge required to be paid
with respect to such exchange or transfer. The applicant for any such transfer
or exchange may be required to pay all taxes and governmental charges in
connection with such transfer or exchange, other than exchanges pursuant to
Section 2.07 hereof.

      SECTION 2.04 LOST, STOLEN, DESTROYED AND MUTILATED NOTES. Upon receipt by
the 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
Trustee shall authenticate and deliver, a replacement Note of the same 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 within 15 days be due and payable, 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

                                       30
<PAGE>

applicant for 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
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 2.05 TRUSTEE'S AUTHENTICATION CERTIFICATE. The Trustee's
authentication certificate upon any Notes shall be substantially in the form
attached to the 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 Trustee; and such certificate of the Trustee upon any Note shall
be conclusive evidence and the only competent evidence that such Note has been
authenticated and delivered hereunder. The 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 Trustee, but it shall not be
necessary that the same person sign the certificate of authentication on all of
the Notes issued hereunder.

      SECTION 2.06 CANCELLATION AND DESTRUCTION OF NOTES BY THE TRUSTEE.
Whenever any Outstanding Notes shall be delivered to the Trustee for the
cancellation thereof pursuant to this Indenture, upon payment of the principal
amount and interest represented thereby, or for replacement pursuant to Section
2.03 hereof, such Notes shall be promptly cancelled and, within a reasonable
time, cremated or otherwise destroyed by the Trustee and counterparts of a
certificate of destruction evidencing such cremation or other destruction shall
be furnished by the Trustee to the Issuer.

      SECTION 2.07 TEMPORARY NOTES. Pending the preparation of definitive Notes,
the Issuer may execute and the 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 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 principal office of the Trustee, and
the 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 2.08 ISSUANCE OF NOTES. The Issuer shall have the authority, upon
complying with the provisions of this Article II, to issue and deliver the Notes
which shall be secured by the Trust Estate. In addition, the Issuer may, subject
to Section 3.03 hereof, enter into any Derivative Product Agreement it deems
necessary or desirable with respect to any or all of the Notes.

      SECTION 2.09 DEFINITIVE NOTES. If (a) the Administrator advises the
Trustee in writing that the Clearing Agency is no longer willing or able to
discharge its responsibilities with respect

                                       31
<PAGE>

to the Notes, and the Administrator is unable to locate a successor; (b) the
Administrator at its option advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency; or (c) after the
occurrence of an Event of Default, or a default by a Servicer or the
Administrator under a Servicing Agreement or the Administration Agreement,
respectively, Noteholders representing beneficial interests aggregating at least
a majority of the Outstanding Amount of the Notes advise the Clearing Agency
(which shall then notify the Trustee) in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Noteholders, then the Trustee shall cause the Clearing Agency to notify
all Noteholders, through the Clearing Agency, of the occurrence of any such
event and of the availability of definitive Notes to Noteholders requesting the
same. Upon surrender to the Trustee of the typewritten Notes representing the
book-entry Notes by the Clearing Agency, accompanied by registration
instructions, the Issuer shall execute and the Trustee shall authenticate the
definitive Notes in accordance with the instructions of the Clearing Agency.
None of the Issuer, the Note Registrar or the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and shall
be protected in relying on, such instructions. Upon the issuance of definitive
Notes, the Trustee shall recognize the holders of the definitive Notes as
Registered Owners.

      SECTION 2.10 PAYMENT OF PRINCIPAL AND INTEREST.

            (a)   The LIBOR-Rate Notes shall accrue interest as provided in the
      forms of Class A-1 Notes and Class A-2 Notes set forth in Exhibits B-1 and
      B-2 hereto. The Auction Rate Notes shall accrue interest as specified in
      Annex 1 hereto. Such interest shall be payable with respect to each class
      of Notes on each applicable Distribution Date as specified in Section
      5.03(c) hereof, subject to Section 4.01 hereof. Any installment of
      interest or principal, if any, payable on any Note which is punctually
      paid or duly provided for by the Issuer on the applicable Distribution
      Date shall be paid to the Person in whose name such Note is registered on
      the Record Date by check mailed first-class, postage prepaid to such
      Person's address as it appears on the records of the Trustee on such
      Record Date, except that, unless definitive Notes have been issued
      pursuant to Section 2.09, with respect to Notes registered on the Record
      Date in the name of the nominee of the Clearing Agency (initially, such
      nominee to be Cede & Co.), payment shall be made by wire transfer in
      immediately available funds to the account designated by such nominee and
      except for the final installment of principal payable with respect to such
      Note on a Distribution Date or on the Final Maturity Date for such Note
      which shall be payable as provided below.

            (b)   The principal of each Note shall be payable in installments on
      each applicable Distribution Date as provided in Section 5.03(c) hereof.
      Notwithstanding the foregoing, the entire unpaid principal amount of each
      class of the Notes shall be due and payable, if not previously paid, on
      the Final Maturity Date for such class of Notes and on the date on which
      an Event of Default shall have occurred and be continuing if the Trustee
      or the Registered Owners of the Notes representing not less than a
      majority of the Outstanding Amount of the Notes have declared the Notes to
      be immediately due and payable in the manner provided in Section 6.02. The
      Trustee shall notify the Person in whose name a Note is registered at the
      close of business on the Record Date preceding

                                       32
<PAGE>

      the applicable Distribution Date (other than the Final Maturity Date) on
      which the Issuer expects that the final installment of principal of and
      interest on such Note will be paid. Such notice shall be mailed or
      transmitted by facsimile prior to such final Distribution Date and shall
      specify that such final installment will be payable only upon presentation
      and surrender of such Note and shall specify the place where such Note may
      be presented and surrendered for payment of such installment.

                                  ARTICLE III

                 PARITY AND PRIORITY OF LIEN; OTHER OBLIGATIONS;
                        AND DERIVATIVE PRODUCT AGREEMENTS

      SECTION 3.01 PARITY AND PRIORITY OF LIEN. The provisions, covenants and
agreements herein set forth to be performed by or on behalf of the Issuer shall
be for the equal benefit, protection and security of the Registered Owners, all
of which 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 3.02 OTHER OBLIGATIONS. The Available Funds and other moneys,
Financed Eligible Loans, securities, evidences of indebtedness, interests,
rights and properties pledged under this Indenture are and will be owned by the
Issuer free and clear of any pledge, lien, charge or encumbrance thereon or with
respect thereto prior to, of equal rank with or subordinate to 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 Eligible Loan is found to have been subject to a
lien at the time such Financed Eligible Loan was acquired, the Issuer shall
cause such lien to be released, shall purchase such Financed Eligible Loan from
the Trust Estate for a purchase price equal to its principal amount plus any
unamortized premium, if any, and interest accrued thereon plus any Special
Allowance Payments that may not be payable to the Trustee or shall replace such
Financed Eligible Loan with another Eligible Loan with substantially identical
characteristics which replacement Eligible Loan 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 Eligible Loans which would be on a parity with, subordinate to, 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 any matter or things 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 which if unpaid might by law be given precedence to or any equality
with this Indenture as a lien or charge upon the Financed Eligible Loans;
provided, however, that nothing in this Section 3.02 shall require the Issuer to
pay, discharge or make 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, in the opinion of the Trustee, 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 Class A Obligations and the Class B
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.

                                       33
<PAGE>

      SECTION 3.03 DERIVATIVE PRODUCT AGREEMENTS; COUNTERPARTY PAYMENTS; ISSUER
DERIVATIVE PAYMENTS. The Issuer hereby authorizes and directs the Trustee to
acknowledge and agree to any Derivative Product Agreement 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 Trustee may
receive, from time to time, Counterparty Payments for the account of the Issuer.
No Derivative Product Agreement shall be entered into subsequent to the Closing
Date unless the Trustee shall have received a Rating Agency Confirmation from
each Rating Agency that such Derivative Product Agreement will not adversely
affect the Rating on any of the Notes. Each of the LIBOR Derivative Product
Agreements is designated as a "Class A Obligation" and each of the Initial
Counterparties shall be a "Class A Beneficiary."

                                   ARTICLE IV

                       PROVISIONS APPLICABLE TO THE NOTES;
                              DUTIES OF THE ISSUER

      SECTION 4.01 PAYMENT OF PRINCIPAL AND INTEREST. 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 according to the true intent and meaning thereof. The
Obligations shall be and are hereby declared to be payable from and equally
secured, except as specifically provided in this Indenture with respect to
certain payment and other priorities, 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 Registered
Owners or any Counterparty have any right to possession or control of any
Financed Eligible Loans, which shall be held only by the Trustee or its agent or
bailee.

      SECTION 4.02 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 Trustee shall reasonably require for the better
conveying, transferring and pledging and confirming unto the Trustee, all and
singular, the properties constituting the Trust Estate hereby transferred and
pledged, or intended so to be transferred and pledged.

      SECTION 4.03 FURTHER COVENANTS OF THE ISSUER.

            (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 State of the State 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, including but not limited to the Basic Documents to
      which it is a party, and will punctually perform all duties required by
      the Trust Agreement and the laws of the State.

                                       34
<PAGE>

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

            (d)   The Issuer shall cause to be kept separate, 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 which relate
      to the Notes and any Derivative Product Agreement.

            (e)   The Issuer, upon written request of the Trustee, will permit
      at all reasonable times the 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 Eligible Loans, and will
      furnish the Trustee such other information as it may reasonably request.
      The Trustee shall be under no duty to make any such examination unless
      requested in writing to do so by the Registered Owners of 66% in
      collective aggregate principal amount of the Notes at the time Outstanding
      or any Counterparty, and unless such Registered Owners or Counterparty
      shall have offered the Trustee security and indemnity satisfactory to it
      against any costs, expenses and liabilities which might be incurred
      thereby.

            (f)   The Issuer covenants that all Financed Eligible Loans upon
      receipt thereof shall be delivered to the Trustee or its agent or bailee
      to be held pursuant to this Indenture and pursuant to a Servicing
      Agreement or a Custodian Agreement.

            (g)   The Issuer shall notify the Trustee and each Rating Agency in
      writing prior to entering into any Derivative Product Agreement subsequent
      to the Closing Date.

            (h)   The Issuer covenants that the aggregate outstanding principal
      balance of all Financed Student Loans being exchanged for Add-On Loans
      shall not exceed the amount set forth in Section 5.02.

      SECTION 4.04 ENFORCEMENT OF SERVICING AGREEMENTS. The Issuer shall comply
with and shall require each Servicer (other than a subservicer of the Master
Servicer) to comply with the following, whether or not the Issuer is otherwise
in default under this Indenture:

            (a)   cause to be diligently enforced and taken all reasonable
      steps, actions and proceedings necessary for the enforcement of all terms,
      covenants and conditions of all Servicing Agreements, including the prompt
      payment of all amounts due the Issuer thereunder, including, without
      limitation, all principal and interest payments (as such payments may be
      adjusted to take into account (i) any discount that the Issuer or the
      Administrator on its behalf may cause to be made available to borrowers
      who make payments on Financed Eligible Loans through automatic withdrawal
      or (ii) any reduction in interest payable on Financed Eligible Loans
      provided for in any borrower incentive or other special program under
      which such Financed Eligible Loans were originated), and all Interest
      Benefit Payments, insurance, guarantee and default claims and Special
      Allowance Payments which relate to any Financed Eligible Loans and cause
      any such Servicer to specify whether payments received by it represent
      principal or interest;

                                       35
<PAGE>

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

            (c)   at all times, to the extent permitted by law, cause to be
      defended, enforced, preserved and protected the rights and privileges of
      the Issuer, the Trustee, the Registered Owners and the Counterparties
      under or with respect to each applicable Servicing Agreement;

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

            (e)   the Issuer agrees to give the Trustee prompt written notice of
      each default on the part of any such Servicer of its obligations under the
      applicable Servicing Agreement coming to the Issuer's attention;

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

            (g)   the Issuer shall cause Collegiate Funding Master Servicing,
      L.L.C., as Servicer, to deliver to the Trustee and the Issuer, on or
      before March 1 of each year, beginning with March 2004, a certificate
      stating that (i) a review of the activities of each Servicer during the
      preceding calendar year and of its performance under the applicable
      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, each Servicer has fulfilled all its obligations
      under its 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 stature thereof. The
      Issuer shall send copies of such annual certificate of the Master Servicer
      to each Rating Agency; and

            (h)   not consent or agree to or permit any amendment or
      modification of any Servicing Agreement to which it is a party which will
      in any manner materially adversely affect the rights or security of the
      Registered Owners and the Counterparties. The Issuer shall be entitled to
      receive and rely upon an opinion of its counsel, together with Rating
      Agency Confirmation, that any such amendment or modification will not
      materially adversely affect the rights or security of the Registered
      Owners and the Counterparties.

      SECTION 4.05 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 Trustee, and in the
calculation of the amount transferred, interest on the investment which 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 4.06 ADDITIONAL COVENANTS WITH RESPECT TO THE ACT. The Issuer
covenants that it will cause the Trustee to be, or replace the Trustee with, an
Eligible Lender under the Act,

                                       36
<PAGE>

that it will acquire or cause to be acquired Eligible Loans originated and held
only by an Eligible Lender and that it will not dispose of or deliver any
Financed Eligible Loans or any security interest in any such Financed Eligible
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 Guaranteed Eligible Loans; provided, however, that nothing above shall
prevent the Issuer from delivering the Eligible Loans to the Servicer or the
Guarantee Agency. The Registered Owners of the Notes shall not in any
circumstances be deemed to be the owner or holder of the Guaranteed Eligible
Loans.

      The Issuer, or the Administrator on behalf of the Issuer, shall be
responsible for each of the following actions with respect to the Act:

            (a)   the Issuer, or the Administrator on behalf of the Issuer,
      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 Guaranty Agencies with respect to the rights, benefits and
      obligations under the Guarantee Agreements with respect to the Financed
      Eligible Loans;

            (b)   the Issuer, or the Administrator on behalf of the Issuer,
      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
      Eligible Loans and agreements in connection therewith, including the
      prompt payment of all principal and interest payments and all other
      amounts due thereunder (as such payments may be adjusted to take into
      account (i) any discount that the Issuer or the Administrator on its
      behalf may cause to be made available to borrowers who make payments on
      Financed Eligible Loans through automatic withdrawal or (ii) any reduction
      in interest payable on Financed Eligible Loans provided for in any
      borrower incentive or other special program under which such Financed
      Eligible Loans were originated) and all Interest Benefit Payments,
      insurance, guarantee and default claims and Special Allowance Payments
      which relate to such Financed Eligible Loans;

            (c)   the Issuer, or the Administrator on behalf of the Issuer,
      shall cause the Financed Eligible Loans to be serviced by entering into
      one or more Servicing Agreements or other agreements with one or more
      Servicers for the collection of payments made for, and the administration
      of the accounts of, the Financed Eligible Loans;

            (d)   the Issuer, or the Administrator on behalf of the Issuer,
      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 the Financed Eligible Loans;

            (e)   the Issuer, or the Administrator on behalf of the Issuer,
      shall cause the benefits of the Guarantee Agreements, the Interest Benefit
      Payments and the Special Allowance Payments to flow to the Trustee. The
      Trustee shall have no liability for

                                       37
<PAGE>

      actions taken at the direction of the Issuer or the Administrator, except
      for negligence or willful misconduct in the performance of its express
      duties hereunder. The Trustee shall have no obligation to administer,
      service or collect the loans in the Trust Estate or to maintain or monitor
      the administration, servicing or collection of such loans; and

            (f)   the Issuer, or the Administrator on behalf of the Issuer,
      shall cause each Financed Eligible Loan evidenced by a Master Promissory
      Note in the form mandated by Section 432(m)(1) of the Act to be acquired
      pursuant to a Student Loan Purchase Agreement with a Seller containing
      language similar to the following:

                  "The Seller hereby represents and warrants that the Seller is
            transferring all of its right title and interest in the MPN Loan to
            the Trustee, that it has not assigned any interest in such MPN Loan
            (other than security interests that have been released or ownership
            interests that the Seller has reacquired) to any person other than
            the Trustee, and that no prior holder of the MPN Loan has assigned
            any interest in such MPN Loan (other than security interests that
            have been released or ownership interests that such prior holder has
            reacquired) to any person other than a predecessor in title to the
            Seller. The Seller hereby covenants that the Seller shall not
            attempt to transfer to any other person any interest in any MPN Loan
            assigned hereunder. The Seller hereby authorizes the Trustee to file
            a UCC-1 financing statement identifying the Seller as debtor and the
            Trustee as secured party and describing the MPN Loan sold pursuant
            to this Agreement. The preparation or filing of such UCC-1 financing
            statement is solely for additional protection of the Trustee's
            interest in the MPN Loans and shall not be deemed to contradict the
            express intent of the Seller and the Trustee that the transfer of
            MPN Loans under this Agreement is an absolute assignment of such MPN
            Loans and is not a transfer of such MPN Loans as security for a
            debt."

      The Trustee shall not be deemed to be the designated agent for the
purposes of this Section 4.06 unless it has agreed in writing to be such agent.

      SECTION 4.07 FINANCED ELIGIBLE LOANS; COLLECTIONS THEREOF; ASSIGNMENT
THEREOF. The Issuer, through the Servicers, shall diligently collect all
principal and interest payments on all Financed Eligible Loans (as such payments
may be adjusted to take into account (i) any discount that the Issuer or the
Administrator on its behalf may cause to be made available to borrowers who make
payments on Financed Eligible Loans through automatic withdrawal or (ii) any
reduction in interest payable on Financed Eligible Loans provided for in any
borrower incentive or other special program under which such Financed Eligible
Loans were originated), and all Interest Benefit Payments, insurance, guarantee
and default claims and Special Allowance Payments which relate to such Financed
Eligible Loans. The Issuer shall cause the filing and assignment of such claims
(prior to the timely filing deadline for such claims under the Regulations) by
the Servicers (other than a subservicer of the Master Servicer). The Issuer will
comply with the Act and Regulations which apply to the Program and to such
Financed Eligible Loans.

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<PAGE>

      SECTION 4.08 APPOINTMENT OF AGENTS, DIRECTION TO TRUSTEE, ETC. The Issuer
shall employ and appoint all employees, agents, consultants and attorneys which
it may consider necessary. No member or officer of the Administrator, either
singly or collectively, shall be personally liable for any act or omission not
willfully fraudulent or mala fide. The Issuer hereby directs the Trustee to
enter into this Indenture, the Administration Agreement, the Custodian
Agreements, the Guarantee Agreements, the Auction Agent Agreement, the Master
Servicing Agreement, the Back-up Administration Agreement, the Market Agent
Agreements, the Broker-Dealer Agreements, the Derivative Product Agreements, the
Student Loan Purchase Agreements, each Investment Agreement and the Eligible
Lender Trust Agreements.

      SECTION 4.09 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 Eligible Loans.

      SECTION 4.10 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
statutory trust, except as otherwise permitted by this Section 4.10. The Issuer
further agrees that it will not (a) sell, transfer or otherwise dispose of all
or substantially all, of its assets (except Financed Eligible Loans if such
sale, transfer or disposition will discharge this Indenture in accordance with
Article X hereof); (b) consolidate with or merge into another entity; or (c)
permit one or more other entities to consolidate with or merge into it.

      SECTION 4.11 AMENDMENT OF STUDENT LOAN PURCHASE AGREEMENTS. The Issuer
shall notify the Trustee in writing of any proposed amendments to any existing
Student Loan Purchase Agreement. No such amendment shall become effective unless
and until the Issuer obtains a Rating Agency Confirmation and the Trustee
consents in writing to such amendment. The consent of the Trustee shall not be
unreasonably withheld and shall not be withheld if the Trustee receives an
opinion of counsel acceptable to them that such an amendment is required by the
Act and is not prejudicial to the Registered Owners or the Counterparties.
Notwithstanding the foregoing, however, the Trustee shall consent to an
amendment from time to time so long as it is not materially prejudicial to the
interests of the Registered Owners or the Counterparties, and the Trustee may
rely on an opinion of counsel to such effect.

      SECTION 4.12 REPRESENTATIONS; NEGATIVE COVENANTS.

            (a)   The Issuer hereby makes the following representations and
      warranties to the Trustee for the benefit of the Registered Owners and, in
      the case of clauses (i) through (vii) below, inclusive, the
      Counterparties, on which the Trustee relies in authenticating the Notes
      and on which the Registered Owners have relied in purchasing the Notes and
      the Counterparties have relied on entering into the Derivative Product
      Agreements. Such representations and warranties shall survive the transfer
      and assignment of the Trust Estate to the Trustee.

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

                                       39
<PAGE>

                  (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 create and issue the Notes, to execute, deliver and
            perform this Indenture and the Derivative Product Agreements and the
            other Basic Documents to which it is a party, and to grant a
            security interest in the Trust Estate to the Trustee and the
            Counterparties and the creation and issuance of the Notes,
            execution, delivery and performance of this Indenture and the
            Derivative Product Agreements and the other Basic Documents to which
            it is a party, and grant of a security interest in the Trust Estate
            to the Trustee have been duly authorized by the Issuer by all
            necessary statutory trust action.

                  (iv)  Binding Obligation. This Indenture and the Derivative
            Product Agreements and the other Basic Documents to which it is a
            party, assuming due authorization, execution and delivery by the
            Trustee and the Counterparties and the other parties to such Basic
            Documents, the Notes in the hands of the Registered Owners thereof
            and the Issuer Derivative Payments are and will be legal, valid and
            binding special limited obligations of the Issuer secured by and
            payable solely from the Trust Estate, enforceable against the Issuer
            in accordance with their 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 other Basic Documents to
            which the Issuer is a party and the fulfillment of the terms hereof
            and thereof 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.

                                       40
<PAGE>

                  (vi)  No Proceedings. There are no proceedings, injunctions,
            writs, restraining orders or investigations to which the Issuer or
            any of the Issuer's 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 invalidity of this Indenture and
            the other Basic Documents to which the Issuer is a party, (B)
            seeking to prevent the issuance of any Notes or the consummation of
            any of the transactions contemplated by this Indenture and the other
            Basic Documents to which the Issuer is a party 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 and the other Basic
            Documents to which the Issuer is a party.

                  (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 and the Derivative Product
            Agreements and any other Basic Documents to which the Issuer is a
            party, and the creation and issuance of the Notes, have been taken
            or obtained on or prior to the Closing Date.

                  (viii) Place of Business. The Issuer's place of business and
            chief executive office is located in Wilmington, Delaware and the
            Issuer has had no other chief executive office.

                  (ix)  Tax and Accounting Treatment. The Issuer intends to
            treat the transactions contemplated by the Student Loan Purchase
            Agreements as an absolute transfer rather than as a pledge of the
            Financed Eligible Loans from the Seller for federal income tax and
            financial accounting purposes and the Issuer will be treated as the
            owner of the Financed Eligible Loans for all purposes. The Issuer
            further intends to treat the Notes as its indebtedness for federal
            income tax and financial accounting purposes.

                  (x)   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 such entity's properties or assets for which there is not an
            adequate reserve reflected in such entity's current financial
            statements.

                  (xi)  Legal Name. The legal name of the Issuer is "Collegiate
            Funding Services Education Loan Trust 2003-B" and has not changed
            since its inception.

                                       41
<PAGE>

            The Issuer has no trade names, fictitious names, assumed names or
            "dba's" under which it conducts its business and has made no filing
            in respect of any such name.

                  (xii) Business Purpose. The Issuer has acquired the Financed
            Eligible Loans conveyed to it under a Student Loan Purchase
            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 no subsidiaries, has
            adopted and operated consistently with all requirements for
            statutory trusts under the laws of the State with respect to its
            operations and has engaged in no other activities other than those
            specified in this Indenture and the Student Loan Purchase Agreements
            and in accordance with the transactions contemplated herein and
            therein.

                  (xiii) 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.

                  (xiv) 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 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 business or transaction for which any property remaining with
            such entity was an unreasonably small capital or for which the
            remaining assets of such entity are unreasonably small in relation
            to the business of such entity 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 paid received
            by the Issuer for the grant of the Trust Estate was reasonably
            equivalent to the value of the related grant.

                  (xv)  No Management of Affairs of Seller. The Issuer is not
            and will not be involved in the day-to-day management of the Seller,
            the Administrator, the Sponsor or any affiliate.

                  (xvi) No Transfers with Seller or Affiliates. Other than the
            acquisition of assets and the transfer of any Notes pursuant to this
            Indenture, the Issuer does not engage in and will not engage in any
            transactions with the Seller and affiliates, except as provided in
            the Basic Documents.

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

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<PAGE>

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

                  (xix) 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.

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

                  (xxi) No Material Misstatements or Omissions. No information,
            certificate of an officer, statement furnished in writing or report
            delivered to the Trustee, the Servicer, any Registered Owner, any
            Counterparty or any underwriter of the Notes 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 Trustee, and to the extent Notes remain Outstanding, approval
            of the Registered Owners and a Rating Agency Confirmation and, to
            the extent a Derivative Product Agreement is Outstanding, approval
            of the Counterparties;

                  (iv)  permit the validity or effectiveness of this Indenture,
            any Supplement 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;

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

                                       43
<PAGE>

                  (vi)  take any action or fail to take any action that would
            result in the lien of this Indenture or the priority of that lien
            for the obligations secured thereby being lost or impaired;

                  (vii) incur or assume any indebtedness or guarantee any
            indebtedness of any Person whether secured by any Financed Eligible
            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 its
            Sponsor or any other affiliate and its separate existence
            disregarded in any federal or state proceeding;

                  (ix)  act as agent of any Seller or, except as provided in the
            Basic Documents, allow the Seller to act as its agent;

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

                  (xi)  consent to the appointment of a conservator or receiver
            or liquidator in any insolvency, readjustment of debt, marshalling
            of assets and liabilities or similar proceedings of or relating to
            the Issuer or of or relating to all or substantially all of its
            property, or a decree or order of a court or agency or supervisory
            authority having jurisdiction in the premises for the appointment of
            a conservator or receiver or liquidator in any insolvency,
            readjustment of debt, marshalling of assets and liabilities or
            similar proceedings, or for the winding-up or liquidation of its
            affairs, shall have been entered against the Issuer; or the Issuer
            shall not consent to the appointment of a receiver, conservator 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; or

                  (xii) without obtaining a Rating Agency Confirmation permit
            the Master Servicer to be the primary servicer on any Financed
            Eligible Loan.

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

                  (i)   Financed Eligible Loans. Each Financed Eligible Loan
            acquired by the Issuer shall constitute an Eligible Loan and contain
            the characteristics

                                       44
<PAGE>

            found in a Student Loan Purchase Agreement. Notwithstanding the
            definition of "Eligible Loans" herein, the Issuer covenants that no
            more than 20% of each purchase of Eligible Loans will be made up of
            Eligible Loans delinquent by more than 30 days, and no Financed
            Eligible Loan will be subject to any borrower incentive or other
            special program that provides for the reduction in interest or
            principal payable on such Financed Eligible Loan in amounts in
            excess of, or on terms more favorable than, those described in
            Exhibit F.

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

                  (iii) All Filings Made. All filings (including, without
            limitation, UCC filings) necessary in any jurisdiction to give the
            Trustee a first priority perfected security interest in the Trust
            Estate, including the Financed Eligible Loans, have been made no
            later than 10 days after the Closing Date and copies of the
            file-stamped financing statements shall be delivered to the Trustee
            promptly following 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
            Financed Eligible Loans (other than the security interest created in
            favor of the Trustee and the Counterparties) to be created.

                  (iv)  Transfer Not Subject to Bulk Transfer Act. Each grant of
            the Financed Eligible 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.

                  (v)   Payment or Adequate Provision for Payment to be Made.
            The Issuer will cause to be paid, or will make adequate provision
            for the satisfaction and discharge of, all lawful claims and demands
            which, if unpaid, might by law be given precedence to or any
            equality with this Indenture as a lien or charge on the Financed
            Eligible Loans.

                  (vi)  No Transfer Taxes Due. Each grant of the Financed
            Eligible 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 Seller to any federal, state or local
            government.

      SECTION 4.13 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
      Student Loan Purchase Agreements, and in connection with the issuance of
      Notes and in connection with the Derivative Products Agreements.

                                       45
<PAGE>

            (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 not form, or cause to be formed, any
      subsidiaries.

            (f)   The Issuer shall act solely in its own name and through its
      duly authorized officers or agents 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.

            (g)   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 the
      State at such place or places as may be designated from time to time by
      the provisions of the Trust Agreement.

            (h)   All actions of the Issuer shall be taken by an Authorized
      Representative.

            (i)   The Issuer shall not amend, alter, change or repeal any
      provision contained in this Section 4.13 without (i) the prior written
      consent of the Trustee and (ii) a Rating Agency Confirmation from each
      Rating Agency rating any Notes Outstanding (a copy of which shall be
      provided to the Trustee) that such amendment, alteration, change or repeal
      will have no adverse effect on the rating assigned to the Notes.

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

            (k)   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.

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

                                       46
<PAGE>

            (m)   The Issuer will maintain an arm's length relationship with the
      Seller (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 it renders or otherwise furnishes to the Issuer except
      as otherwise provided in this Indenture. Except as contemplated in the
      Basic Documents, the Issuer will not hold itself out to be responsible for
      the debts of the Seller, the parent or the decisions or actions respecting
      the daily business and affairs of the Seller or parent.

      SECTION 4.14 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, the
Derivative Product Agreements or the applicable Student Loan Purchase
Agreements, or of any failure on the part of the Seller, Collegiate Funding
Services Resources I, LLC or Collegiate Funding Services, L.L.C. to observe or
perform in any material respect any covenant, representation or warranty of the
Seller, Collegiate Funding Services Resources I, LLC or Collegiate Funding
Services, L.L.C. set forth in the applicable Student Loan Purchase Agreements,
shall promptly notify the Trustee, the Master Servicer and each Rating Agency of
such failure.

      SECTION 4.15 CERTAIN REPORTS.

            (a)   The Issuer will:

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

                  (ii)  file with the Trustee and the Commission, in accordance
            with rules and regulations prescribed from time to time by the
            Commission, such additional information, documents and reports 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

                  (iii) transmit by mail to the Registered Owners of Notes and
            the Counterparties, within 30 days after the filing thereof with the
            Trustee, in the manner and to the extent provided in TIA Section
            313(c), such summaries of any information, documents and reports
            required to be filed by the Issuer pursuant to clauses (a) and (b)
            of this Section 4.15 as may be required by rules and regulations
            prescribed from time to time by the Commission.

            (b)   The Trustee shall mail to each Registered Owner and each
      Counterparty, within 60 days after each December 31 beginning with the
      December 31 following the date of this Indenture, a brief report as of
      such December 31 that complies with TIA Section 313(a) if required by said
      section. The Trustee shall also comply with TIA Section 313(b). A copy of
      each such report required pursuant to TIA Section 313(a) or

                                       47
<PAGE>

      (b) shall, at the time of such transaction to Registered Owners and each
      Counterparty, be filed by the Trustee with the Commission and with each
      securities exchange, if any, upon which the Notes are listed, provided
      that the Issuer has previously notified the Trustee of such listing.

            (c)   Within 15 days following the end of each month, the Trustee
      shall prepare or cause to be prepared, and will forward to (i) each
      Registered Owner and each Counterparty by mail (which, so long as the
      Notes are held in book-entry form, shall be the Clearing Agency or its
      nominee), or (ii) upon the written request of a Noteholder sent to the
      Principal Office of the Trustee, to such Noteholder, a statement setting
      forth the following information with respect to the Notes and the Financed
      Eligible Loans as of the end of such period:

                  (i)   The amount of principal payments made with respect to
            each class of Notes during the preceding month;

                  (ii)  The amount of interest payments made with respect to
            each class of Notes during the preceding month;

                  (iii) The aggregate principal balance of the Financed Eligible
            Loans as of the close of business on the last day of the preceding
            month;

                  (iv)  The aggregate outstanding principal amount of each class
            of Notes;

                  (v)   The interest rate for each class of Notes during the
            preceding month and the next Distribution Date for each class;

                  (vi)  The number and principal amount of Financed Eligible
            Loans that are delinquent or for which claims have been filed with a
            Guarantee Agency; and

                  (vii) The outstanding principal amount of the Notes as of the
            close of business on the last day of the preceding month.

      The Trustee may conclusively rely and accept such reports from the Issuer
as fulfilling the requirements of this Section 4.15, with no further duty to
know, determine or examine such reports or comply with the prescribed timing,
rules and regulations of the Commission.

      SECTION 4.16 STATEMENT AS TO COMPLIANCE. The Issuer will deliver to the
Trustee, within 120 days after the end of each fiscal year, a brief certificate
from an Authorized Representative including (a) a current list of the Authorized
Representatives, and (b) a statement indicating whether or not to the knowledge
of the signers thereof the Issuer is in compliance with all conditions and
covenants under this Indenture and, in the event of any noncompliance,
specifying such noncompliance and the nature and status thereof. For purposes of
this Section 4.16, such compliance shall be determined without regard to any
period of grace or requirement of notice under this Indenture.

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<PAGE>

      SECTION 4.17 REPRESENTATIONS OF THE ISSUER REGARDING THE TRUSTEE'S
SECURITY INTEREST. The Issuer hereby represents and warrants for the benefit of
the Trustee and the Registered Owners and the Counterparties 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 Eligible Loans and all other
      assets constituting part of the Trust Estate in favor of the Trustee,
      which security interest is prior to all other liens, charges, security
      interests, mortgages or other encumbrances, and is enforceable as such as
      against creditors of and purchasers from Issuer.

            (b)   The Financed Eligible Loans constitute "accounts" within the
      meaning of the applicable UCC.

            (c)   The Issuer owns and has good and marketable title to the
      Financed Eligible Loans and all other assets constituting part of the
      Trust Estate free and clear of any lien, charge, security interest,
      mortgage or other encumbrance, claim or encumbrance of any Person, other
      that those granted pursuant to this Indenture.

            (d)   The Issuer has caused or will have caused, within ten 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 Eligible Loans and all other
      assets of the Trust Estate granted to the Trustee hereunder.

            (e)   The Issuer has given the Trustee a copy of a written
      acknowledgment from each Custodian that such Custodian is holding executed
      copies of the promissory notes and master promissory notes that constitute
      or evidence the Financed Eligible Loans, and that such Custodian is
      holding such solely on behalf and for the benefit of the Trustee.

            (f)   Other than the security interest granted to the Trustee
      pursuant to this Indenture, the Issuer has not pledged, assigned, sold,
      granted a security interest in, or otherwise conveyed any of the Financed
      Eligible Loans or any other portion of the Trust Estate. 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 Eligible Loans or any other portion of the Trust Estate other
      than any financing statement relating to the security interest granted to
      the Trustee hereunder or that has been terminated. The Issuer is not aware
      of any judgment or tax lien filings against the Issuer.

      SECTION 4.18 FURTHER COVENANTS OF THE ISSUER REGARDING THE TRUSTEE'S
SECURITY INTEREST. The Issuer hereby covenants for the benefit of the Trustee
and the Registered Owners and the Counterparties as follows:

            (a)   The representations and warranties set forth in Section 4.17
      shall survive the termination of this Indenture.

            (b)   The Trustee shall not waive any of the representations and
      warranties set forth in Section 4.17 above.

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<PAGE>

            (c)   The Issuer shall take all steps necessary, and shall cause the
      Servicers and subservicers, if any, to take all steps necessary and
      appropriate, to maintain the perfection and priority of the Trustee's
      security interest in the Financed Eligible Loans and all other assets of
      the Trust Estate.

                                   ARTICLE V

                                      FUNDS

      SECTION 5.01 CREATION AND CONTINUATION OF FUNDS AND ACCOUNTS. There are
hereby created and established the following Funds and Accounts to be held and
maintained by the Trustee for the benefit of the Registered Owners and the
Counterparties:

            (a)   Acquisition Fund;

            (b)   Collection Fund;

            (c)   Reserve Fund; and

            (d)   Capitalized Interest Account.

      The 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 which are deemed necessary or
desirable.

      SECTION 5.02 ACQUISITION FUND. There shall be deposited into the
Acquisition Fund moneys from proceeds of the Notes in an amount equal to
$1,020,352,610. Financed Eligible Loans shall be held by the Trustee or its
agent or bailee (including a Custodian or Servicer) 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 (a) pay costs of issuance of the Notes, including the costs
related to the purchase of one or more Derivative Product Agreements, and (b)
upon receipt by the Trustee of an Eligible Loan Acquisition Certificate, to
acquire Eligible Loans pursuant to a Student Loan Purchase Agreement at a price
not in excess of, in respect of each Eligible Loan (i) acquired on the Closing
Date, 102.5% of the aggregate principal balance of such Eligible Loan plus
accrued borrower interest thereon, and (ii) otherwise, 102.5% of the aggregate
principal balance of such Eligible Loan, plus accrued borrower interest. Any
such Issuer Order or Eligible Loan Acquisition Certificate shall state that such
proposed use of moneys in the Acquisition Fund is in compliance with the
provisions of this Indenture. An Authorized Representative of the Issuer may, by
Issuer Order, direct the Trustee to transfer any or all such moneys to the
Collection Fund for use therein. Notwithstanding the foregoing, if any funds or
moneys remain in the Acquisition Fund on January 31, 2004, then the Trustee
shall, without direction from or notice to the Issuer, transfer all such
remaining moneys or funds to the Collection Fund not later than the third
Business Day preceding the Quarterly Distribution Date in March 2004.

                                       50
<PAGE>

      While the Issuer will be the beneficial owner of the Financed Eligible
Loans and the Registered Owners and the Counterparties will have a security
interest therein, it is understood and agreed that the Trustee will be the legal
owner thereof and will have a security interest in the Financed Eligible Loans
for and on behalf of the Registered Owners and the Counterparties. In the case
of a single Financed Eligible Loan evidenced by a separate note, each such note
will be held in the name of the Trustee for the account of the Issuer, for the
benefit of the Registered Owners and the Counterparties. In the case of a
Financed Eligible Loan evidenced by a Master Promissory Note, the Issuer shall
cause the holder of the original Master Promissory Note to indicate by book
entry on its books and records that the Issuer is the beneficial owner of the
Loan and that the Trustee is the legal owner and has a security interest in the
Financed Eligible Loan for the benefit of the Registered Owners and the
Counterparties.

      Notwithstanding any contrary provision set forth in this Indenture or any
other Basic Document, during the Add-On Period the Issuer may exchange one or
more Financed Student Loans subject to the lien of the Indenture for one or more
Add-On Loans. Each Add-On loan must be an Eligible Loan and must relate to a
consolidation loan that is owned by the Issuer and is subject to the lien of the
Indenture. The aggregate outstanding principle balance of all Add-On Loans
transferred to the Issuer on any date must be equal to or greater than the
aggregate outstanding principal balance of all the Financed Student Loans for
which they are being exchanged. Each Add-On Loan must be exchanged with the
Sponsor pursuant to a loan transfer addendum during the Add-On Period. The
aggregate outstanding principal balance of all Financed Student Loans being
exchanged for Add-On Loans shall not exceed $40,000,000. Each Add-On Loan being
acquired by the Issuer shall be deemed a Financed Student Loan and each Financed
Student Loan released to the Sponsor in exchange for such Add-On Loan shall be
released from the lien of the Indenture once such exchange is complete.

      Except as set forth above and as provided in Sections 5.07, 10.03 and
10.04 hereof, Financed Eligible Loans shall not be sold, transferred or
otherwise disposed of (other than for consolidation, serialization or transfer
to a Guaranty Agency) by the Trustee free from the lien of this Indenture.

      SECTION 5.03 COLLECTION FUND.

            (a)   Deposits to Collection Fund. The Trustee shall deposit
      approximately $193,115 of the proceeds from the sale of Notes into the
      Collection Fund on the Closing Date. There shall be deposited to the
      Collection Fund all Available Funds, and all other moneys and investments
      derived from assets on deposit in and transfers from the Acquisition Fund,
      the Capitalized Interest Account and the Reserve Fund, all Counterparty
      Payments and any other amounts deposited thereto upon receipt of an Issuer
      Order. Moneys on deposit in the Collection Fund shall be used to make the
      payments described below. The Trustee may conclusively rely on all written
      instructions of the Administrator described in this Indenture with no
      further duty to examine or determine the information contained in any
      Administrator's Certificate or Issuer Order.

            (b)   Payments on Monthly Payment Dates. The Administrator shall
      instruct the Trustee in writing no later than the Business Day preceding
      each Monthly Payment

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<PAGE>

      Date, or on such Monthly Payment Date if the Trustee so consents (based on
      the information contained in a signed certificate by the Administrator and
      the Back-up Administrator (in the form set forth as Exhibit C hereto) to
      make the following distributions by 1:00 p.m. (New York time) on such
      Monthly Payment Date, from and to the extent of the Available Funds on
      deposit in the Collection Fund, in the following priority: (i) to the
      Department, amounts owed to such parties in respect of the Financed
      Eligible Loans; (ii) to the Master Servicer, Servicing Fees owed to it for
      such month and any unpaid Servicing Fees from prior months; and (iii) to
      the Counterparties, based on amounts owed to such party, without
      preference or priority of any kind, any Issuer Derivative Payments owed to
      each such Counterparty for that month, excluding all Termination Payments.

            (c)   Payments on Quarterly Distribution Dates and Auction Rate
      Distribution Dates. The Administrator shall instruct the Trustee in
      writing no later than the Business Day preceding each Auction Rate
      Distribution Date and Quarterly Distribution Date, or on such Auction Rate
      Distribution Date or Quarterly Distribution Date if the Trustee so
      consents (based on the information contained in a signed certificate by
      the Administrator and the Back-up Administrator (in the form set forth as
      Exhibit D hereto) and the related Servicer's Report) to make the following
      deposits and distributions from Available Funds in the Collection Fund to
      the Persons or to the account specified below by 1:00 p.m. (New York time)
      on such Distribution Date and the Trustee shall comply with such
      instructions:

                        (A)   to the Department, amounts owed to such parties in
            respect of the Financed Eligible Loans, including amounts described
            in clause (a)(i) and (ii) of the definition of Available Funds,
            respectively, to the extent not already paid;

                        (B)   to pay to the Master Servicer, the Trustee, the
            Auction Agent, the Broker-Dealers and the Delaware Trustee, pro
            rata, based on amounts owed to each such party, without preference
            or priority of any kind, the Servicing Fee (to the extent remaining
            unpaid following the Monthly Payment Date), the Trustee Fee, the
            Auction Agent Fee, the Broker-Dealer Fees, and the Delaware Trustee
            Fee, respectively, due on such Distribution Date, in each case,
            together with such fees remaining unpaid from prior Distribution
            Dates (and, in the case of the Servicing Fee, prior Monthly Payment
            Dates);

                        (C)   to pay to the Administrator and the Back-up
            Administrator, pro rata, based on amounts owed to each such party,
            the Administration Fee due on such Distribution Date and all unpaid
            Administration Fees from prior Distribution Dates and the Back-up
            Administration Fee due on such Distribution Date and all unpaid
            Back-up Administration Fees from prior Distribution Dates,
            respectively;

                        (D)   to pay, pro rata, (i) to the Class A Noteholders
            of each class for which such date is a Distribution Date, the
            portion of the Class A Noteholders'

                                       52
<PAGE>

            Interest Distribution Amount payable to such class on such
            Distribution Date and (ii) to the Counterparties, any Issuer
            Derivative Payments arising from Confirmations, and any Priority
            Termination Payments, owed to the Counterparties on such
            Distribution Date, based on amounts owed to each such party;

                        (E)   to pay, pro rata, to the Class B Noteholders of
            each class for which such date is a Distribution Date, the portion
            of the Class B Noteholders' Interest Distribution Amount payable to
            such class on such Distribution Date;

                        (F)   to pay to the Class A-1 Noteholders until the
            Class A-1 Notes are been paid in full, the Class A-1 Noteholders'
            Principal Distribution Amount;

                        (G)   to pay to the Class A-2 Noteholders until the
            Class A-2 Notes are paid in full, the Class A-2 Noteholders'
            Principal Distribution Amount;

                        (H)   to pay to the Class A-3 Noteholders, in lots of
            $50,000, until the Class A-3 Notes are paid in full, the Class A-3
            Noteholders' Principal Distribution Amount;

                        (I)   to pay to the Class A-4 Noteholders, in lots of
            $50,000, until the Class A-4 Notes are paid in full, the Class A-4
            Noteholders' Principal Distribution Amount;

                        (J)   to pay to the Class A-5 Noteholders, in lots of
            $50,000, until the Class A-5 Notes are paid in full, the Class A-5
            Noteholders' Principal Distribution Amount;

                        (K)   to pay to the Class A-6 Noteholders, in lots of
            $50,000, until the Class A-6 Notes are paid in full, the Class A-6
            Noteholders' Principal Distribution Amount;

                        (L)   to pay to the Class A-7 Noteholders, in lots of
            $50,000, until the Class A-7 Notes are paid in full, the Class A-7
            Noteholders' Principal Distribution Amount;

                        (M)   to pay to the Class B-1 Notes and the Class B-2
            Notes, in each case, until paid in full, the Principal Distribution
            Amount, pro rata, in lots of $50,000, without preference or priority
            of any kind; and

                        (N)   to deposit to the Reserve Fund, the amount, if
            any, necessary to reinstate the balance of the Reserve Fund up to
            the Reserve Fund Requirement;

                        (O)   to pay to the Class A-3 Noteholders, the Class A-4
            Noteholders, the Class A-5 Noteholders, the Class A-6 Noteholders
            and the Class

                                       53
<PAGE>

            A-7 Noteholders, pro rata, any unpaid Auction Rate Carry-Over Amount
            for each such class, pro rata, without preference or priority of any
            kind;

                        (P)   to pay to the Class B-1 Noteholders and the Class
            B-2 Noteholders, any unpaid Auction Rate Carry-Over Amount for each
            such class, pro rata, without preference or priority of any kind;

                        (Q)   to pay to the Counterparties, any Issuer
            Derivative Payments (including, without limitation, any Termination
            Payments other than Priority Termination Payments) due to the
            Counterparties under the Derivative Product Agreements that remain
            unpaid;

                        (R)   to pay to the Master Servicer, the aggregate
            unpaid amount of the Carryover Servicing Fee, if any;

                        (S)   if the Student Loans are not sold on the Optional
            Purchase Date, to pay as accelerated payment of principal to the
            holders of the Notes in the order and priority described in clauses
            (F) through (M) above, until each Class of Notes has been paid in
            full; and

                        (T)   on each Quarterly Distribution Date, subject to
            the remaining Sections of this Section 5.03, to pay to the Sponsor
            any remaining funds.

            Notwithstanding the above, on each Quarterly Distribution Date, all
      deposits and distributions made following clause (E) above shall be made
      only with money then available in the Collection Fund that exceeds the
      Auction Rate Notes Accrued Interest Amount for such Quarterly Distribution
      Date.

            Amounts properly distributed to the Sponsor pursuant to paragraph
      (T) shall be deemed released from the Trust Estate and the security
      interest therein granted to the Trustee, and the Sponsor shall in no event
      thereafter be required to refund any such distributed amounts.

            (d)   Determination, Allocation and Payment of Principal
      Distribution Amount. The Principal Distribution Amount will be determined
      and allocated to the Notes only on Quarterly Distribution Dates. If a
      class of LIBOR-Rate Notes is allocated some or all of the Principal
      Distribution Amount on a Quarterly Distribution Date, that class also will
      be paid such amount on such Quarterly Distribution Date. If a class of
      Auction Rate Notes is allocated some or all of the Principal Distribution
      Amount on a Quarterly Distribution Date, such class will be paid such
      amount on such Quarterly Distribution Date only if such date is also an
      Auction Rate Distribution Date for such class. Otherwise, such Principal
      Distribution Amount or portion thereof will be allocated to such class and
      held in the Collection Fund and paid to such class on the immediately
      succeeding Auction Rate Distribution Date for such class.

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<PAGE>

            (e)   Allocations of Funds among Holders of Auction Rate Notes. If
      less than all of the Auction Rate Notes of a given class are to be paid or
      allocated principal in an amount sufficient to cover the full amount
      payable to such Note, the particular Auction Rate Notes of such class to
      be paid shall be selected by the Trustee by random lots of $50,000. If
      there are any amounts available to pay principal to the Class A-3 Notes,
      the Class A-4 Notes, the Class A-5 Notes, the Class A-6 Notes and the
      Class A-7 Notes or to the Class B-1 Notes and Class B-2 Notes, as
      applicable, that are not in $50,000 increments, the Trustee shall retain
      such amounts in the Collection Account to pay principal to the Class A-3
      Notes, Class A-4 Notes, Class A-5 Notes, Class A-6 Notes, the Class A-7
      Notes, Class B-1 Notes and Class B-2 Notes.

            (f)   Optional Redemption of Class B Notes. Prior to the date on
      which the Outstanding Amount of the Class A Notes is reduced to zero, and
      provided that a Rating Agency Confirmation has been obtained; the Issuer
      may, by Issuer Order, instruct the Trustee to pay principal on each class
      of Class B Notes on an Auction Rate Distribution Date from amounts
      otherwise distributable to the Sponsor pursuant to clause (T) on the
      preceding Quarterly Distribution Date.

            (g)   Redemption of Auction Rate Notes Generally; Prepayment Date
      and Prepayment Price. Following the payment in full of the LIBOR-Rate
      Notes, the Notes of any class of Auction Rate Notes shall be subject to
      redemption or principal distribution at the option of the Issuer on any
      date selected by it (a "Prepayment Date") pursuant to Section 5.03(h), (i)
      or (j) and as otherwise provided in clauses (k) through (o) below. The
      redemption price (the "Prepayment Price") for any Notes to be redeemed
      pursuant to Section 5.03(h), (i) or (j) shall be 100% of the outstanding
      principal balance of such Notes plus interest accrued thereon through the
      Prepayment Date, provided, that if all of the Outstanding Notes are to be
      redeemed, the redemption price shall also include an amount sufficient to
      pay all fees owed to the Trustee, the Master Servicer, the Auction Agent,
      the Broker-Dealers, the Administrator and the Delaware Trustee, any Issuer
      Derivative Payments owed to the Counterparties and any Auction Rate
      Carry-Over Amounts owed to a class of Auction Rate Notes.

            (h)   Optional Redemption of Auction Rate Notes. For any Auction
      Rate Distribution Date following the payment in full of the LIBOR-Rate
      Notes, and subject to Section 5.03(f) the Issuer may, by Issuer Order,
      instruct the Trustee to pay principal on one or more classes of Auction
      Rate Notes selected by the Issuer, from amounts otherwise distributable to
      the Sponsor pursuant to clause (T) on such Quarterly Distribution Date.

            (i)   Optional Redemption of Auction Rate Notes From Sale of
      Financed Eligible Loans. For any Auction Rate Distribution Date following
      the payment in full of the LIBOR-Rate Notes, the Issuer may, by Issuer
      Order, direct the Trustee to sell Financed Eligible Loans and use the
      proceeds of such sale to redeem one or more classes of Auction Rate Notes
      selected by the Issuer, provided that (i) the Trustee may not sell any
      Financed Eligible Loans for less than the Purchase Amount for each such
      Financed Eligible Loan and (ii) the Issuer and the Trustee shall have
      received Rating Agency

                                       55
<PAGE>

      Confirmation with respect to such sale. Any such sale shall be effected by
      the Trustee in the same manner as a sale of the Trust Estate pursuant to
      Section 6.04 hereof, and proceeds of such sale shall be deposited into the
      Collection Fund and applied to redeem each such class on the immediately
      succeeding Auction Rate Distribution Date for such class.

            (j)   Extraordinary Optional Redemption of Auction Rate Notes. For
      any Auction Rate Distribution Date following the payment in full of the
      LIBOR-Rate Notes, the Issuer may, by Issuer Order, direct the Trustee to
      redeem some or all of the Auction Rate Notes selected by the Issuer at the
      applicable Prepayment Price on any Auction Rate Distribution Date for each
      such class, if the Issuer reasonably determines that the rate of return on
      the Financed Eligible Loans has materially decreased or that the costs of
      administering the Trust Estate have placed unreasonable burdens on the
      Issuer's ability (or the Administrators' ability on behalf of the Issuer)
      to perform the Issuer's obligations under this Indenture.

            (k)   Notice of Redemption and Purchase. An election of the Issuer
      to prepay any class of Auction Rate Notes pursuant to Section 5.03(f)
      through (j) shall be evidenced by an Issuer Order, received by the Trustee
      and the Auction Agent no later than the 25th day preceding the Prepayment
      Date, stating (i) the Prepayment Date, (ii) the class or classes of Notes
      or portion thereof to be prepaid, (iii) the principal amount of each such
      class or classes of Notes or portion thereof to be redeemed and (iv) the
      portion of the Prepayment Price allocable to each such class or portion
      thereof.

            Notice of prepayment with respect to any class of Notes shall be
      given by the Trustee by first-class mail, postage prepaid, mailed by no
      later than 15 days prior to the Prepayment Date to the Registered Owners
      of Notes to be prepaid at the address of such Registered Owner appearing
      in the note register; but neither failure to give such notice nor any
      defect in any notice so given shall affect the validity of the proceedings
      for prepayment of any Note not affected by such failure or defect. So long
      as any such Notes are maintained in book-entry form, the Trustee shall
      treat the Clearing Agency as the sole Registered Owner of such Notes. All
      notices of prepayment shall state (i) the Prepayment Date, (ii) the
      Prepayment Price, (iii) the name (including class designation), Final
      Maturity Date and CUSIP number of each of the Notes to be prepaid, (iv)
      the principal amount of Notes of each class to be prepaid, and, if less
      than all outstanding Notes of a class are to be prepaid, the
      identification (and, in the case of partial prepayment, the respective
      principal amounts) of the Notes of each class to be prepaid, (v) that, on
      the Prepayment Date, the Prepayment Price on each such Note will become
      due and payable and that interest on each such Note shall cease to accrue
      on and after such date, (vi) the place or places where such Notes are to
      be surrendered for payment of the Prepayment Price thereof, and (vii) if
      it be the case, that such Notes are to be prepaid by the application of
      certain specified trust moneys and for certain specified reasons.

            Within 60 days after any Prepayment Date, a second notice of
      prepayment shall be given by the Trustee, in the manner described above,
      to the Registered Owner of a Note that was not presented for prepayment
      within 30 days after the Prepayment Date.

                                       56
<PAGE>

      Following provision of notice, the Prepayment Price will become due and
      payable on the Prepayment Date, and interest shall cease to accrue on the
      Notes to be redeemed. Upon surrender of any such Note for redemption in
      accordance with such notice, such Note shall be paid at the Prepayment
      Price. If any Note called for redemption shall not be so paid upon
      surrender thereof for redemption, the Prepayment Price and, to the extent
      lawful, interest thereon shall, until paid, bear interest from the
      Prepayment Date at the interest rate borne by the Note on the Prepayment
      Date.

            Any Note which is to be redeemed only in part shall be surrendered
      to the Trustee (with, if the Trustee so requires, due endorsement by, or a
      written instrument of transfer in form satisfactory to the Trustee duly
      executed by, the Registered Owner thereof or his, her or its attorney duly
      authorized in writing) and an Authorized Representative shall execute and
      the Trustee shall authenticate and deliver to the Registered Owner of such
      Note, without service charge, a new Note or Notes of the same class, of
      any authorized denomination or denominations, in aggregate outstanding
      principal balance equal to the unredeemed portion of the principal of the
      Note so surrendered. Any Note with respect to which a partial distribution
      of principal is made shall remain Outstanding in the then current
      outstanding principal balance. The Trustee shall retain a record of the
      outstanding principal balance of each Note any portion of the principal of
      which has been distributed.

            (l)   Limitation on Redemption of Class B Notes. Notwithstanding
      anything to the contrary, in no event may any Class B Notes be redeemed
      pursuant to Section 5.03(i) or (j) if any Class A Notes would be
      Outstanding following such redemption unless the Issuer receives a Rating
      Agency Confirmation in connection with such redemption.

            (m)   Limitation on Sale of Financed Eligible Loans. Except upon
      satisfying the Rating Agency Confirmation, the Issuer may direct the
      Trustee to sell to any purchaser one or more Financed Eligible Loans only
      in the following circumstances: (i) to the Sponsor or other seller if such
      party is required to repurchase such Financed Eligible Loan pursuant to a
      Loan Purchase Agreement; (ii) to a Guaranty Agency under a Guarantee
      Agreement; (iii) pursuant to Section 5.03(i) hereof or (iv) pursuant to
      Section 10.03 hereof. Any money received by the Issuer in connection with
      a sale of Financed Eligible Loans pursuant to this paragraph shall, in the
      case of a sale pursuant to (1) clauses (i) and (ii) of the preceding
      sentence, be deposited into the Collection Fund for application on the
      immediately succeeding Monthly Payment Date, Quarterly Distribution Date
      or Auction Rate Distribution Date, as applicable, and (2) clauses (iii)
      and (iv) of the preceding sentence, be applied as set forth in Section
      5.03(i) and Section 10.03 hereof, respectively. Notwithstanding the
      foregoing, except pursuant to Section 10.03 hereof, the Issuer may not
      direct the Trustee to sell any Financed Eligible Loans to the Sponsor
      (unless the Sponsor is required to repurchase such Eligible Loan pursuant
      to a Loan Purchase Agreement).

                                       57
<PAGE>

      SECTION 5.04 RESERVE FUND.

            (a)   On the Closing Date, the Trustee shall deposit $7,504,775 into
      the Reserve Fund. Thereafter, the Trustee shall transfer to the Reserve
      Fund from the Collection Fund all amounts designated for transfer thereto
      pursuant to Section 5.03(c)(N) hereof.

            (b)   On each Monthly Payment Date or Distribution Date, to the
      extent there are insufficient Available Funds in the Collection Fund to
      make one or more of the transfers required by Sections 5.03(b) and
      5.03(c)(A) through (c)(E), and after giving effect to any transfers from
      the Capitalized Interest Account to the Collection Fund on such Monthly
      Payment Date or Distribution Date, as the case may be, then the
      Administrator shall instruct the Trustee in writing to withdraw from the
      Reserve Fund on such Monthly Payment Date or Distribution Date, as the
      case may be, an amount equal to such deficiency and to deposit such amount
      in the Collection Fund. Additionally, if on the Final Maturity Date for a
      class of Notes, and after giving effect to the distribution of the
      Available Funds on such Final Maturity Date, the principal amount of such
      class of Notes will not be reduced to zero, the Administrator shall
      instruct the Trustee in writing to withdraw from the Reserve Fund on such
      Final Maturity Date an amount equal to the amount needed to reduce the
      principal amount of such class of Notes to zero and to deposit such amount
      in the Collection Fund for application to payment of the outstanding
      principal balance of such class of Notes.

            (c)   After giving effect to Section 5.04(b) above, if the amount on
      deposit in the Reserve Fund on any Distribution Date is greater than the
      Reserve Fund Requirement for such Distribution Date, the Administrator
      shall instruct the Trustee in writing to withdraw from the Reserve Fund on
      such Distribution Date an amount equal to such excess and to deposit such
      amount in the Collection Fund.

            (d)   On the final Distribution Date upon termination of the Trust
      and following the payment in full of the Outstanding Amount of the Notes
      and of all other amounts (other than unpaid Issuer Derivative Payments and
      Carryover Servicing Fees) owing or to be distributed hereunder to
      Noteholders, the Trustee, the Master Servicer, the Administrator, the
      Auction Agent, the Broker-Dealers, the Delaware Trustee or the
      Counterparties (excluding Termination Payments other than Priority
      Termination Payments), to the extent that Available Funds on such date are
      insufficient to make the following payments, amounts remaining in the
      Reserve Fund shall be used first to pay any unpaid Issuer Derivative
      Payments and second to pay any Carryover Servicing Fees. Any amount
      remaining on deposit in the Reserve Fund after such payments have been
      made shall be distributed to the Sponsor. The Sponsor shall in no event be
      required to refund any amounts properly distributed pursuant to this
      Section 5.04(d).

      SECTION 5.05 CAPITALIZED INTEREST ACCOUNT. (a) On the Closing Date, the
Trustee shall deposit $5,000,000 into the Capitalized Interest Account. On each
Monthly Payment Date or Distribution Date, to the extent there are insufficient
Available Funds in the Collection Fund to make one or more of the transfers
required by Sections 5.03(b) and 5.03(c)(A) through (c)(E), before giving effect
to any transfers from the Reserve Fund to the Collection Fund on such

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Monthly Payment Date or Distribution Date, as the case may be, then the
Administrator shall instruct the Trustee in writing to withdraw from the
Capitalized Interest Account on such Monthly Payment Date or Distribution Date,
as the case may be, an amount equal to such deficiency and to deposit such
amount in the Collection Fund.

            (a)   After giving effect to Section 5.05(a) above, if the amount on
      deposit in the Capitalized Interest Account on the Quarterly Distribution
      Date in June 2004 is greater than $2,000,000, the Administrator shall
      instruct the Trustee in writing to withdraw from the Capitalized Interest
      Account on such Quarterly Distribution Date an amount equal to the excess
      and to deposit such amount in the Collection Fund.

            (b)   After giving effect to Section 5.05(a) above, on the Quarterly
      Distribution Date in March 2005 the Administrator shall instruct the
      Trustee in writing to withdraw all amounts remaining in the Capitalized
      Interest Account on such Quarterly Distribution Date and to deposit such
      amounts in the Collection Fund.

      SECTION 5.06 INVESTMENT OF FUNDS HELD BY TRUSTEE. The Trustee shall invest
money held for the credit of any Fund or Account or Subaccount held by the
Trustee hereunder as directed in writing (or orally, confirmed in writing) by an
Authorized Representative of the Issuer, to the fullest extent practicable and
reasonable, in Investment Securities which shall mature or be redeemed at the
option of the holder prior to the next Monthly Payment Date. In the absence of
any such direction and to the extent practicable, the Trustee may invest amounts
held hereunder in those Investment Securities described in clause (xi) of the
definition of the Investment Securities. All such investments shall be held by
(or by any Custodian on behalf of) the Trustee for the benefit of the Issuer;
provided that prior to or on the Business Day preceding each Distribution Date
and Monthly Payment Date all interest and other investment income collected (net
of losses and investment expenses) on funds on deposit therein shall be
deposited into the Collection Fund and shall be deemed to constitute a portion
of the Available Funds for such Distribution Date. The Trustee and the Issuer
hereby agree that unless an Event of Default shall have occurred hereunder, the
Issuer acting by and through an Authorized Representative shall be entitled to,
and shall, provide written direction or oral direction confirmed in writing to
the Trustee with respect to any discretionary acts required or permitted of the
Trustee under any Investment Securities and the Trustee shall not take such
discretionary acts without such written direction.

      The Investment Securities purchased shall be held by the Trustee and shall
be deemed at all times to be part of such Fund or Account or Subaccounts or
combination thereof, and the Trustee shall inform the Issuer of the details of
all such investments. Upon direction in writing (or orally, confirmed in
writing) from an Authorized Representative of the Issuer, the Trustee shall use
its best efforts to sell at the best price obtainable, or present for
redemption, any Investment Securities purchased by it as an investment whenever
it shall be necessary to provide money to meet any payment from the applicable
Fund. The 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
under the provisions of this Indenture as of the end of the preceding month and
the value thereof,

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and shall list any investments which were sold or liquidated for less than the
par value thereof, plus accrued but unpaid interest 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
Investment Securities purchased. The Trustee and its affiliates may act as
principal or agent in the acquisition or disposition of any Investment
Securities.

      Notwithstanding the foregoing, the 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 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.

      Any investment of funds in Investment Securities shall be held by a
financial institution in accordance with the following requirements:

                  (i)   all Investment Securities shall be held in an account
            with such financial institution in the name of the Trustee;

                  (ii)  all Investment Securities held in such account shall be
            delivered to the Trustee in the following manner:

                        (A)   with respect to bankers' acceptances, commercial
            paper, negotiable certificates of deposit and other obligations that
            constitute "instruments" within the meaning of Section 9-102(a)(47)
            of the Uniform Commercial Code in effect in the applicable
            jurisdiction (the "UCC") (other than certificated securities) and
            are susceptible of physical delivery, transferred to the Trustee by
            physical delivery to the Trustee, indorsed to, or registered in the
            name of, the Trustee or its nominee or indorsed in blank; or such
            additional or alternative procedures as may hereafter become
            appropriate to effect the complete transfer of ownership of any such
            Investment Securities to the Trustee free of any adverse claims,
            consistent with changes in applicable law or regulations or the
            interpretation thereof;

                        (B)   with respect to a "certificated security" (as
            defined in Section 8-102(a)(4) of the UCC), transferred:

                              (1)   by physical delivery of such certificated
                        security to the Trustee, provided that if the
                        certificated security is in registered form, it shall be
                        indorsed to, or registered in the name of, the Trustee
                        or indorsed in blank;

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                              (2)   by physical delivery of such certificated
                        security in registered form to a "securities
                        intermediary" (as defined in Section 8-102(a)(14) of the
                        UCC) acting on behalf of the Trustee if the certificated
                        security has been specially indorsed to the Trustee by
                        an effective endorsement;

                        (C)   with respect to any security issued by the U.S.
            Treasury, the Federal Home Loan Mortgage Corporation or by the
            Federal National Mortgage Association that is a book-entry security
            held through the Federal Reserve System pursuant to Federal book
            entry regulations, the following procedures, all in accordance with
            applicable law, including applicable federal regulations and
            Articles 8 and 9 of the UCC: book-entry registration of such
            property to an appropriate book-entry account maintained with a
            Federal Reserve Bank by a securities intermediary which is also a
            "depositary" pursuant to applicable federal regulations and issuance
            by such securities intermediary of a deposit advice or other written
            confirmation of such book-entry registration to the Trustee of the
            purchase by the securities intermediary on behalf of the Trustee of
            such book-entry security; the making by such securities intermediary
            of entries in its books and records identifying such book-entry
            security held through the Federal Reserve System pursuant to Federal
            book-entry regulations as belonging to the Trustee and indicating
            that such securities intermediary holds such book-entry security
            solely as agent for the Trustee; or such additional or alternative
            procedures as may hereafter become appropriate to effect complete
            transfer of ownership of any such Investment Securities to the
            Trustee free of any adverse claims, consistent with changes in
            applicable law or regulations or the interpretation thereof;

                        (D)   with respect to any "uncertificated security" (as
            defined in Section 8-102(a)(18) of the UCC) that is not governed by
            clause (C) above, transferred:

                              (1)   (a) by registration to the Trustee as the
                        registered owner thereof, on the books and records of
                        the issuer thereof, or

                              (b)   by registration to another Person (not a
                        securities intermediary) that either becomes the
                        registered owner of the uncertificated security on
                        behalf of the Trustee or, having become the registered
                        owner, acknowledges that it holds for the Trustee; or

                              (2)   by the issuer thereof having agreed that it
                        will comply with instructions originated by the Trustee
                        without further consent of the registered owner thereof;

                        (E)   with respect to any "security entitlement" (as
            defined in Section 8-102(a)(17) of the UCC):

                              (1)   if a securities intermediary

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                              (a)   indicates by book entry that a "financial
                        asset" (as defined in Section 8-102(a)(9) of the UCC)
                        has been credited to the Trustee's "securities account"
                        (as defined in Section 8-501(a) of the UCC),

                              (b)   receives a financial asset (as so defined)
                        from the Trustee or acquires a financial asset for the
                        Trustee, and, in either case, accepts it for credit to
                        the Trustee's securities account (as so defined),

                              (c)   becomes obligated under other law,
                        regulation or rule to credit a financial asset to the
                        Trustee's securities account, or

                              (d)   has agreed that it will comply with
                        "entitlement orders" (as defined in Section 8-102(a)(8)
                        of the UCC) originated by the Trustee, without further
                        consent by the "entitlement holder" (as defined in
                        Section 8-102(a)(7) of the UCC), and

                              (2)   such financial asset either is such
                        Investment Security or a security entitlement evidencing
                        a claim thereto; and

                        (F)   in each case of delivery contemplated pursuant to
            clauses (A) through (E) above, the Trustee shall make appropriate
            notations on its records, and shall cause the same to be made on the
            records of its nominees, indicating that such Investment Security is
            held in trust pursuant to and as provided in this Indenture.

      Any cash held by the Trustee shall be considered a "financial asset" for
purposes of this paragraph. Subject to the other provisions hereof, the Trustee
shall have sole control over each such investment and the income thereon, and
any certificate or other instrument evidencing any such investment, if any,
shall be delivered directly to the Trustee or its agent, together with each
document of transfer, if any, necessary to transfer title to such investment to
the Trustee in a manner which complies with this paragraph.

      The Trustee agrees that it has no security interest or other adverse claim
to the Funds or the Investment Securities therein that are part of the Trust
Estate other than pursuant to this Indenture and that it will not enter into any
agreement that would give any Person or entity other than the Trustee the right
to give entitlement orders with respect to such Investment Securities or the
Funds.

      The Administrator, on behalf of the Issuer, shall retain the authority to
institute, participate and join in any plan of reorganization, readjustment,
merger or consolidation with respect to the issuer of any Investment Securities
held hereunder, and, in general, to exercise each and every other power or right
with respect to such Investment Securities as individuals generally have and
enjoy with respect to their own assets and investments, including power to vote
upon any matter relating to holders of such Investment Securities.

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      SECTION 5.07 RELEASE.

            (a)   The Trustee shall, upon Issuer Order and subject to the
      provisions of this Indenture, take all actions reasonably necessary to
      effect the release of any Financed Eligible Loans from the lien of this
      Indenture to the extent the terms hereof permit the sale, disposition or
      transfer of such Financed Eligible Loans.

            (b)   Subject to the payment of its fees and expenses pursuant to
      Sections 7.05 and 7.07, the Trustee may, and when required by the
      provisions of this Indenture shall, execute instruments to release
      property from the lien of this Indenture, or convey the Trustee's interest
      in the same, in a manner and under circumstances that are not inconsistent
      with the provisions of this Indenture. No party relying upon an instrument
      executed by the Trustee as provided in this Article V shall be bound to
      ascertain the Trustee's authority, inquire into the satisfaction of any
      conditions precedent or see to the application of any moneys.

            (c)   The Trustee shall, at such time as there are no Notes
      Outstanding and all sums due the Trustee pursuant to Sections 7.05 and
      7.07 and all amounts payable to the Master Servicer, the Administrator,
      the Auction Agents, the Broker-Dealers, the Delaware Trustee and the
      Counterparties have been paid, release any remaining portion of the Trust
      Estate that secured the Notes from the lien of this Indenture and release
      to the Issuer or any other Person entitled thereto any funds then on
      deposit in the Funds and Accounts. The Trustee shall release property from
      the lien of this Indenture pursuant to this Section 5.07(c) only upon
      receipt of an Issuer Order, an Opinion of Counsel and (if required by the
      TIA) Independent Certificates in accordance with TIA Sections 314(c) and
      314(d)(1).

            (d)   Subject to the provisions of this Indenture, the Trustee shall
      release property from the lien of this Indenture only upon receipt of an
      Issuer Order, an Opinion of Counsel and Independent Certificates in
      accordance with TIA Sections 314(c) and 314(d)(1) or an Opinion of Counsel
      in lieu of such Independent Certificates to the effect that the TIA does
      not require any such Independent Certificates.

            (e)   Each Registered Owner, by the acceptance of a Note,
      acknowledges that from time to time the Trustee shall release the lien of
      this Indenture on any Financed Eligible Loan to be sold to (i) the Seller
      in accordance with the applicable Student Loan Purchase Agreement; (ii) to
      the Servicer in accordance with the Servicing Agreement; and (iii) to
      another eligible lender holding one or more serial loans with respect to
      such Financed Eligible Loan, in accordance with the Servicing Agreement,
      and each Registered Owner, by the acceptance of a Note, consents to any
      such release.

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                                   ARTICLE VI

                              DEFAULTS AND REMEDIES

      SECTION 6.01 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)   (i) default in the due and punctual payment of any interest on
      any Class A Note (other than Carry-Over Amounts) when the same becomes due
      and payable, and such default shall continue for a period of five (5) days
      or (ii) if no Class A Notes are Outstanding, default in the due and
      punctual payment of any interest on any Class B Note (other than
      Carry-Over Amounts) when the same becomes due and payable, and such
      default shall continue for a period of five (5) days;

            (b)   default in the due and punctual payment of the principal of
      any Note when the same becomes due and payable on the related Final
      Maturity Date;

            (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 Trustee to the Issuer; and

            (d)   the occurrence of an Event of Bankruptcy.

      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 9.01 of this Indenture or such other
address as may hereafter be given as the principal office of the Issuer in
writing to the Trustee by an Authorized Representative of the Issuer. The
Trustee may give any such notice in its discretion and shall give such notice if
requested to do so in writing by the Registered Owners of at least 51% of the
collective aggregate principal amount of the Highest Priority Obligations at the
time Outstanding.

      SECTION 6.02 REMEDY ON DEFAULT; POSSESSION OF TRUST ESTATE. Subject to
Sections 7.05, 7.07 and 6.09 hereof, upon the happening and continuance of any
Event of Default, the Trustee 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 Available Funds 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 which may be made as
just and reasonable compensation for its own services, and for the services of
its attorneys, agents, and assistants, the Trustee shall apply the rest and
residue of the money received by the Trustee as follows:

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      FIRST, to the Trustee, the Eligible Lender Trustee and the Delaware
Trustee, any Trustee Fee and any Delaware Trustee Fee, respectively due and
owing;

      SECOND, to the Master Servicer, the Auction Agent, the Broker Dealers, the
Administrator and the Back-up Administrator, pro rata, without preference or
priority of any kind, according to the amounts due and payable to each such
party, any Servicing Fees, Auction Agent Fees, Broker-Dealer Fees,
Administration Fees and Back-up Administration Fees, respectively, due to each
such party and remaining unpaid;

      THIRD, pro rata, to (i) each Counterparty, in proportion to its
entitlements under the Confirmation relating to its respective Derivative
Product Agreement and any Priority Termination Payments owing to such
Counterparty and (ii) to the Class A Noteholders of each class for amounts due
and unpaid on each such class of Class A Notes for interest, pro rata, without
preference or priority of any kind, according to the amounts due and payable on
each such class of Class A Notes for such interest;

      FOURTH, to Class A Noteholders for amounts due and unpaid on the Class A
Notes for principal, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal;

      FIFTH, to Class B Noteholders of each class for amounts due and unpaid on
each such class of Class B Notes for interest, pro rata, without preference or
priority of any kind, according to the amounts due and payable on each such
class of Class B Notes for such interest;

      SIXTH, to Class B Noteholders of each class for amounts due and unpaid on
each such Class B Notes for principal, pro rata without preference or priority
of any kind, according to the amounts due and payable on each such class of
Class B Notes for principal;

      SEVENTH, to the Noteholders of Class A Auction-Rate Notes, all Auction
Rate Carry-Over Amounts for such classes then due and unpaid, pro rata, without
preference or priority of any kind, according to the amounts due and payable on
such Class A Notes for such Carry-Over Amounts;

      EIGHTH, to the Noteholders of Class B Auction-Rate Notes, all Auction Rate
Carry-Over Amounts for such classes then due and unpaid, pro rata, without
preference or priority of any kind, according to the amounts due and payable on
such Class B Notes for such Carry-Over Amounts;

      NINTH, to each Counterparty, in proportion to the respective entitlements
under the respective Derivative Product Agreement, for any due and unpaid Issuer
Derivative Payments (including all Termination Payments);

      TENTH, to the Servicer, for any unpaid Carryover Servicing Fees; and

      ELEVENTH, to the Issuer, for distribution in accordance with the terms of
the Administration Agreement and the Trust Agreement.

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      The Trustee may fix a record date and payment date for any payment to
Registered Owners and Counterparties pursuant to this Section 6.02. At least 15
days before such record date, the Trustee shall mail to each Counterparty and
each Registered Owner (provided, that so long as the Notes remain in book-entry
form, the only Registered Owner shall be the Clearing Agency or its nominee) and
the Issuer a notice that states the record date, the payment date and the amount
to be paid.

      SECTION 6.03 REMEDIES ON DEFAULT; ADVICE OF COUNSEL. Upon the happening of
any Event of Default, the Trustee may proceed to protect and enforce the rights
of the Trustee and the Registered Owners and the Counterparties in such manner
as counsel for the 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 6.04 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 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 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, necessity, expediency or regularity of any such sale. The 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 Trustee, shall ratify and
confirm any sale or sales by executing and delivering to the Trustee or to such
purchaser or purchasers all such instruments as may be necessary, or in the
judgment of the Trustee, proper for the purpose which may be designated in such
request. In addition, the Trustee may proceed to protect and enforce the rights
of the Trustee and the Registered Owners and the Counterparties in such manner
as counsel for the 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 Trustee shall
take any such action or actions if requested to do so in writing by the
Registered Owners and the Counterparties of at least 51% of the collective
aggregate principal amount of the Highest Priority Obligations at the time
Outstanding. However, in the case of an Event of Default described in Section
8.01(c), the Trustee may take such action or actions only if requested to do so
in writing by the Registered Owners and Counterparties of all Obligations at the
time Outstanding unless the net proceeds received by the Trustee from selling
the Trust Estate are sufficient to pay all amounts owed to all the Registered
Owners and the Counterparties.

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      SECTION 6.05 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 Trustee or of the Registered Owners or of the Counterparties under this
Indenture or otherwise, then as a matter of right, the 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 6.06 RESTORATION OF POSITION. In case the 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 Trustee, then and in every such case to the extent not
inconsistent with such adverse decree, the Issuer, the Trustee, the Registered
Owners and the Counterparties 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 Trustee and of the Registered Owners and of
the Counterparties shall continue as though no such proceeding had been taken.

      SECTION 6.07 PURCHASE OF PROPERTIES BY TRUSTEE OR REGISTERED OWNERS OR
COUNTERPARTIES. In case of any such sale of the Trust Estate, any Registered
Owner or Registered Owners or committee of Registered Owners or Counterparty or
Counterparties or committee of Counterparties or the 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.

      SECTION 6.08 APPLICATION OF SALE PROCEEDS. The proceeds of any sale of the
Trust Estate, together with any funds at the time held by the Trustee and not
otherwise appropriated, shall be applied by the Trustee as set forth in Section
6.02 hereof, and then to the Issuer or whomsoever shall be lawfully entitled
thereto.

      SECTION 6.09 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If an
Event of Default should occur and be continuing, then and in every such case the
Trustee or the Registered Owners of Obligations representing not less than 51%
of the Outstanding Amount of the Highest Priority Obligations may declare all
the Outstanding Obligations to be immediately due and payable, by a notice in
writing to the Issuer (and to the Trustee if given by Registered Owners), and
upon any such declaration the unpaid principal amount of such Outstanding
Obligations, together with accrued and unpaid interest thereon through the date
of acceleration, shall become immediately due and payable, subject, however, to
Section 6.04 of this Indenture.

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      At any time after such declaration of acceleration of maturity has been
made and before a judgment or decree for payment of the money due has been
obtained by the Trustee as hereinafter in this Article VI provided, the
Registered Owners of Obligations representing a majority of the collective
aggregate principal amount of the Highest Priority Obligations then Outstanding,
by written notice to the Issuer and the Trustee, may rescind and annul such
declaration and its consequences if:

            (a)   the Issuer has paid or deposited with the Trustee a sum
      sufficient to pay:

                  (i)   all payments of principal of and interest on all
            Obligations and all other amounts that would then be due hereunder
            or upon such Obligations if the Event of Default giving rise to such
            acceleration had not occurred; and

                  (ii)  all sums paid or advanced by the Trustee hereunder and
            the reasonable compensation, expenses, disbursements and advances of
            the Trustee, the Master Servicer, the Delaware Trustee, the Auction
            Agent and the Broker-Dealers and their agents and counsel; and

            (b)   all Events of Default, other than the nonpayment of the
      principal of the Obligations that has become due solely by such
      acceleration, have been cured or waived as provided in Section 6.15
      hereof.

      No such rescission shall affect any subsequent default or impair any right
consequent thereto.

      SECTION 6.10 REMEDIES NOT EXCLUSIVE. The remedies herein conferred upon or
reserved to the Trustee or the Registered Owners (excluding the Sponsor) of
Obligations or the Counterparties 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 Trustee or to the Registered Owners
of Obligations or the Counterparties, or any supplement hereto, may be exercised
from time to time as often as may be deemed expedient. No delay or omission of
the Trustee or of any Registered Owner of Obligations or the Counterparties 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 6.11 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE. The Issuer covenants that if:

            (a)   (i) default is made in the payment of any installment of
      interest, if any, on any Class A Notes (other than Carry-Over Amounts)
      when such interest becomes due and payable and such default continues for
      a period of five (5) days or (ii) if no Class A Notes are Outstanding,
      default is made in the payment of any installment of interest, if any, on
      any Class B Notes (other than Carry-Over Amounts) when such interest
      becomes due and payable and such default continues for a period of five
      (5) days; or

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            (b)   default is made in the payment of the principal of (or
      premium, if any, on) any Notes at its Final Maturity Date,

then the Issuer will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Registered Owners, the whole amount then due and payable on such
Notes for principal (and premium, if any) and for the benefit of the
Counterparties, the whole amount when due and payable under the Derivative
Products Agreements 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 (or as provided in the
Derivative Product Agreements, as applicable), and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including the reasonable compensation, fees, expenses, disbursements
and advances of the Trustee and its agents and counsel.

      If the Issuer fails to pay such amounts forthwith upon such demand, the
Trustee, in its own name and as Trustee of an express trust, may upon receiving
indemnification satisfactory to the Trustee 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, the
Trustee may, after being indemnified to its satisfaction and in its discretion,
proceed to protect and enforce its rights and the rights of the Registered
Owners of Notes and any related coupons and of the Counterparties by such
appropriate judicial proceedings as the Trustee shall deem most effectual 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.

      SECTION 6.12 DIRECTION OF TRUSTEE. Upon the happening of any Event of
Default, the Registered Owners of at least 51% of the collective aggregate
principal amount of the Highest Priority Obligations then Outstanding, shall
have the right by an instrument or instruments in writing delivered to the
Trustee to direct and control the 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 Registered Owners shall not be entitled
to cause the Trustee to take any proceedings which in the Trustee's opinion
would be unjustly prejudicial to non-assenting Registered Owners of Obligations
or the Counterparties, but the Trustee shall be entitled to assume that the
action requested by the Registered Owners and the Counterparties of at least 51%
of the collective aggregate principal amount of the Highest Priority Obligations
then Outstanding will not be prejudicial to any non-assenting Registered Owners
or the Counterparties unless the Registered Owners and the Counterparties of
more than 51% of the collective aggregate principal amount of the non-assenting
Registered Owners of such Obligations and the Counterparties, in writing, show
the Trustee how they will be prejudiced. Provided, however, that anything in
this Indenture to the

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<PAGE>

contrary notwithstanding, the Registered Owners of a majority of the collective
aggregate principal amount of the Highest Priority Obligations then Outstanding
together with the Registered Owners of a majority of the collective aggregate
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 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 Indenture. The provisions of
this Section 6.12 shall be expressly subject to the provisions of Sections
7.01(c), 7.05 and 7.07 hereof.

      SECTION 6.13 RIGHT TO ENFORCE IN TRUSTEE. No Registered Owner of any
Obligation shall have any right as such Registered Owner 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 Trustee, unless and until such Registered Owner shall have
previously given to the Trustee written notice of a default hereunder, and of
the continuance thereof, and also unless the Registered Owners of the requisite
principal amount of the Obligations then Outstanding shall have made written
request upon the Trustee and the Trustee shall have been afforded reasonable
opportunity to institute such action, suit or proceeding in its own name, and
unless the 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 Trustee to take any such action hereunder,
and the 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 Registered Owners
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 Registered Owners of not less than a majority of the collective
aggregate principal amount of the Obligations then Outstanding.

      SECTION 6.14 PHYSICAL POSSESSION OF OBLIGATIONS NOT REQUIRED. In any suit
or action by the Trustee arising under this Indenture or on all or any of the
Obligations issued hereunder, or any supplement hereto, the 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 6.15 WAIVERS OF EVENTS OF DEFAULT. The 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 Registered Owners (excluding the Sponsor) of at least a majority
of the collective aggregate 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 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 all expenses of the 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 Sections 7.05

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and 7.07 hereof. In case of any such waiver or rescission, or in case any
proceedings taken by the Trustee on account of any such default shall have been
discontinued or abandoned or determined adversely to the Trustee, then and in
every such case the Issuer, the Trustee and the Registered Owners of Obligations
and the Counterparties 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 VII

                                   THE TRUSTEE

SECTION 7.01 ACCEPTANCE OF TRUST. The Trustee hereby accepts the trusts imposed
upon it by this Indenture, and agrees to perform said trusts, but only upon and
subject to the following terms and conditions:

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

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

                  (ii)  in the absence of bad faith on its part, the Trustee may
            conclusively rely, as to the truth of the statements and the
            correctness of the opinions expressed therein, upon certificates or
            opinions furnished to the Trustee and conforming to the requirements
            of this Indenture; but in the case of any such certificates or
            opinions which by any provisions hereof are specifically required to
            be furnished to the Trustee, the Trustee shall be under a duty to
            examine the same to determine whether or not they conform 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 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 Registered
      Owners, the Trustee may require that it be furnished an indemnity bond or
      other indemnity and security satisfactory to it by the Registered Owners,
      as applicable, for the reimbursement of all expenses to which it may be
      put and to protect it against all liability.

      SECTION 7.02 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 Trustee assumes no responsibility for the
correctness of the same. The 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 Trustee shall incur no responsibility in respect of
such matters.

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      SECTION 7.03 AS TO FILING OF INDENTURE. The Trustee shall be under no duty
(a) to file or record, or cause to be filed or recorded, this Indenture or any
instrument supplemental hereto, (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 which may be suitable to be done for the better
maintenance of the lien or security hereof (other than the filing of any
continuation (but not initial) 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 the Trust Estate and Funds intended now or hereafter to be
transferred in trust hereunder are subject to the lien hereof. The 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 Trustee be under any duty in respect of any tax which may be assessed
against it or the Registered Owners or the Counterparties in respect of such
property or pledged to the Trust Estate. The Issuer agrees to prepare or have
prepared, and to request that the Trustee execute (if such execution is
necessary for any such filing) and file in a timely manner, the continuation
statements referred to herein.

      SECTION 7.04 TRUSTEE MAY ACT THROUGH AGENTS. The 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 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 7.05 INDEMNIFICATION OF 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 Sections 6.02 and 6.09 hereof, for each of
which no additional security or indemnity may be required, the Trustee shall be
under no obligation or duty to perform any act at the request of Registered
Owners or to institute or defend any suit in respect thereof unless properly
indemnified and provided with security to its satisfaction as provided in
Section 7.01(c) hereof. The 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 Section 6.01(a) or
(b) hereof) unless and until it shall have been specifically notified in writing
at the address in Section 9.01 hereof of such default or Event of Default by (a)
the Registered Owners or Counterparties of the required percentages in principal
amount of the Obligations then Outstanding hereinabove specified or (b) an
Authorized Representative of the Issuer. However, the 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 Trustee, without assurance of reimbursement or indemnity, and
in such case the Trustee shall be reimbursed or indemnified by the Registered
Owners or Counterparties 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 negligence or willful
misconduct of the Trustee. In furtherance and not in

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limitation of this Section 7.05, the Trustee shall not be liable for, and shall
be held harmless by the Issuer from, following any Issuer Orders, instructions
or other directions upon which the Trustee is authorized to rely pursuant to
this Indenture or any other agreement to which it is a party. If the Issuer or
the Registered Owners or Counterparties, as appropriate, shall fail to make such
reimbursement or indemnification, the 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 Collection Fund. None of the provisions
contained in this Indenture or any other Agreement to which it is a party shall
require the 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 if the Registered Owners or
Counterparties 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 agrees to indemnify the Trustee for, and to hold it harmless
against, any loss, liability or expenses incurred without negligence or bad
faith on its part, arising out of or in connection with the acceptance or
administration of the trust or trusts hereunder, including 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 arising
from the Trust Estate. The Issuer agrees to indemnify and hold harmless the
Trustee against any and all claims, demands, suits, actions or other proceedings
and all liabilities, costs and expenses whatsoever caused by any untrue
statement or misleading statement or alleged untrue statement or alleged
misleading statement of a material fact contained in any offering document
distributed in connection with the issuance of the Notes or caused by any
omission or alleged omission from such offering document of any material fact
required to be stated therein or necessary in order to make the statements made
therein in the light of the circumstances under which they were made, not
misleading.

      SECTION 7.06 TRUSTEE'S RIGHT TO RELIANCE. The Trustee shall 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 Trustee may consult with experts
and with counsel (who may but need not be counsel for the Issuer, the Trustee,
or for a Registered Owner or for a Counterparty), 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 Trustee shall reasonably deem it
desirable that a matter be proved or established prior to taking, suffering or
omitting any action hereunder, the 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 Representative of the Issuer or an
authorized officer of the Administrator or the Servicer.

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      The 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
Trustee shall be liable for its negligence or willful misconduct in taking such
action.

      The Trustee is authorized to enter into agreements with other Persons, in
its capacity as Trustee, in order to carry out or implement the terms and
provisions of this Indenture. The Trustee shall not be liable with respect to
any action taken, suffered or omitted to be taken in good faith in accordance
with this Indenture or any other transaction document or at the direction of the
Registered Owners or Counterparties evidencing the appropriate percentage of the
aggregate principal amount of the Outstanding Notes relating to the time, method
and place of conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee, under this
Indenture or any other transaction document.

      SECTION 7.07 COMPENSATION OF TRUSTEE. Except as otherwise expressly
provided herein, all advances, counsel fees (including without limitation
allocated fees of in-house counsel) and other expenses reasonably made or
incurred by the Trustee in and about the execution and administration of the
trust hereby created and reasonable compensation to the Trustee for its services
in the premises shall be paid by the Issuer. The compensation of the Trustee
shall not be limited to or by any provision of law in regard to the compensation
of trustees of an express trust. The Trustee shall not change the amount of its
annual compensation without giving the Issuer at least 90 days' written notice
prior to the beginning of a Fiscal Year. If not paid by the Issuer, the 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 Collection 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 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 negligence or willful misconduct of the
Trustee).

      SECTION 7.08 TRUSTEE MAY OWN NOTES. The Trustee shall comply with TIA
Section 311(a), excluding any creditor relationship listed in TIA Section
311(b). A Trustee who has resigned or been removed shall be subject to TIA
Section 311(a) to the extent indicated therein. The Trustee hereunder, or any
successor Trustee, in its individual or other capacity, may become the owner or
pledgee of Notes and may otherwise deal with the Issuer, with the same rights it
would have if it were not the Trustee. The 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
Registered Owners and Counterparties 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 Registered Owners of more than 60% of the
collective aggregate principal amount of the Outstanding Obligations.

      SECTION 7.09 RESIGNATION OF TRUSTEE. The Trustee and any successor to the
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;

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provided, however, that such resignation shall only take effect on the day
specified in such notice if a successor Trustee shall have been appointed
pursuant to Section 7.11 hereof (and is qualified to be the Trustee under the
requirements of Section 7.11 hereof). If no successor 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 Trustee may (a)
appoint a temporary successor Trustee having the qualifications provided in
Section 7.11 hereof or (b) request a court of competent jurisdiction to (i)
require the Issuer to appoint a successor, as provided in Section 7.11 hereof,
within three days of the receipt of citation or notice by the court, or (ii)
appoint a Trustee having the qualifications provided in Section 7.11 hereof. In
no event may the resignation of the Trustee be effective until a qualified
successor Trustee shall have been selected and appointed. In the event a
temporary successor Trustee is appointed pursuant to (a) above, the Issuer may
remove such temporary successor Trustee and appoint a successor thereto pursuant
to Section 7.11 hereof.

      SECTION 7.10 REMOVAL OF TRUSTEE. The Trustee or any successor Trustee may
be removed (a) at any time by the Registered Owners of a majority of the
collective aggregate principal amount of Notes which are the Highest Priority
Obligations then Outstanding, (b) by the Administrator for cause or upon the
sale or other disposition of the Trustee or its corporate trust functions or (c)
by the Administrator without cause so long as no Event of Default exists or has
existed within the last 30 days, upon payment to the 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 Delaware Trustee and the other with the Trustee
so removed.

      In the event a Trustee (or successor 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 Registered Owners, such Registered
Owners by instrument or concurrent instruments in writing (signed and
acknowledged by such Registered Owners or their attorneys-in-fact) filed with
the Trustee removed have appointed a successor Trustee or otherwise the Issuer
shall have appointed a successor, and (b) the successor Trustee has accepted
appointment as such.

      SECTION 7.11 SUCCESSOR TRUSTEE. In case at any time the Trustee or any
successor Trustee shall resign, be dissolved, or otherwise shall be disqualified
to act or be incapable of acting, or in case control of the Trustee or of any
successor Trustee or of its officers shall be taken over by any public officer
or officers, a successor Trustee may be appointed by the Administrator by an
instrument in writing duly authorized by the Administrator. In the case of any
such appointment by the Administrator of a successor to the Trustee, the
Administrator shall forthwith cause notice thereof to be mailed to the
Registered Owners of the Notes at the address of each Registered Owner appearing
on the note registration books maintained by the Registrar and to each
Counterparty at the addresses specified in the applicable Derivative Product
Agreement.

      Every successor Trustee appointed by the Registered Owners, by a court of
competent jurisdiction, or by the Administrator 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, which has a reported capital and surplus of not
less than $50,000,000, be authorized under the law to

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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 the Financed Eligible Loans originated under the Act.

      SECTION 7.12 MANNER OF VESTING TITLE IN TRUSTEE. Any successor Trustee
appointed hereunder shall execute, acknowledge and deliver to its predecessor
Trustee, and also to the Issuer, an instrument accepting such appointment
hereunder, and thereupon such successor 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 Trustee shall continue to have the benefits to
indemnification hereunder together with the successor Trustee), with like effect
as if originally named as Trustee herein; but the Trustee ceasing to act shall
nevertheless, on the written request of an Authorized Representative of the
Issuer, or an authorized officer of the successor 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 Trustee all the right, title and interest of
the Trustee which it succeeds, in and to the Trust Estate and such rights,
powers, trusts, duties and obligations, and the Trustee ceasing to act also,
upon like request, pay over, assign and deliver to the successor Trustee any
money or other property or rights subject to the lien of this Indenture,
including any pledged securities which may then be in its possession. Should any
deed or instrument in writing from the Issuer be required by the successor
Trustee for more fully and certainly vesting in and confirming to such new
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 Trustee may adopt the certificate
of authentication of the Trustee or of any successor to the Trustee; and in case
any of the Notes shall not have been authenticated, any successor to the Trustee
may authenticate such Notes in its own name; and in all such cases such
certificate shall have the full force which it has anywhere in the Notes or in
this Indenture.

      SECTION 7.13 ADDITIONAL COVENANTS BY THE TRUSTEE TO CONFORM TO THE ACT.
The 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 the
Financed Eligible Loans, that it will acquire Eligible Loans originated under
the Act in its capacity as an Eligible Lender and that it will not knowingly
dispose of or deliver any Financed Eligible Loans originated under the Act or
any security interest in any such Financed Eligible 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 Financed Eligible
Loans; provided, however, that nothing above shall prevent the Trustee from
delivering the Eligible Loans to the Servicer or the Guaranty Agency.

      SECTION 7.14 RIGHT OF INSPECTION. Any Registered Owner or Counterparty
shall be permitted at reasonable times during regular business hours and in
accordance with reasonable regulations prescribed by the Trustee to examine at
the principal office of the Trustee a copy of

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any report or instrument theretofore filed with the Trustee relating to the
condition of the Trust Estate.

      SECTION 7.15 LIMITATION WITH RESPECT TO EXAMINATION OF REPORTS. Except as
provided in this Indenture, the 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 7.16 SERVICING AGREEMENT. The Trustee acknowledges the receipt of
a copy of the Servicing Agreement described in Section 4.04 hereof.

      SECTION 7.17 ADDITIONAL COVENANTS OF TRUSTEE. The 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 Eligible 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;

            (b)   it will comply with the Act and the Regulations and will, upon
      written notice from an Authorized Representative of the Issuer, the
      Secretary or the Guaranty Agency, use its reasonable efforts to cause this
      Indenture to be amended (in accordance with Section 8.01 hereof) if the
      Act or Regulations are hereafter amended so as to be contrary to the terms
      of this Indenture; and

            (c)   it will not comply with any Issuer Order that does not comply
      with the terms and provisions of this Indenture or which directs the
      Trustee to take an action that is not permitted by the terms and
      provisions of this Indenture.

      SECTION 7.18 DUTY OF TRUSTEE WITH RESPECT TO RATING AGENCIES. It shall be
the duty of the Issuer to notify each Rating Agency then rating any of the Notes
(but the Trustee shall incur no liability for any failure to do so) of (a) any
change, expiration, extension or renewal of this Indenture, (b) prepayment or
defeasance of all the Notes, (c) any change in the Trustee or (d) any other
information reasonably required to be reported to each Rating Agency under any
Supplemental Indenture; provided, however, the provisions of this Section do not
apply when such documents have been previously supplied to such Rating Agency
and the 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 shall be sent in writing at the following addresses:

            Standard & Poor's Ratings Services,
            A Division of the McGraw-Hall Companies, Inc.
            55 Water Street
            New York, New York 10041
            Attention: Asset-Backed Surveillance Group

            Moody's Investors Service, Inc.
            99 Church Street

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            New York, New York 10007
            Attention: ABS Monitoring Group

      The 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 Trustee at mutually agreeable times
and places.

      SECTION 7.19 MERGER OF THE TRUSTEE. Any corporation into which the Trustee
may be merged or with which it may be consolidated, or any corporation resulting
from any merger or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the 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 7.20 RECEIPT OF FUNDS FROM SERVICER. The Trustee shall not be
accountable or responsible in any manner whatsoever for any action of the
Issuer, the Administrator, the depository bank of any funds of the Issuer, or
the Servicer while the Servicer is acting as bailee or agent of the Trustee with
respect to the Eligible Loans for actions taken in compliance with any
instruction or direction given to the Trustee, or for the application of funds
or moneys by the Servicer until such time as funds are received by the Trustee.

      SECTION 7.21 SPECIAL CIRCUMSTANCES LEADING TO RESIGNATION OF TRUSTEE.
Because the Trustee serves as trustee hereunder for Obligations of different
priorities, it is possible that circumstances may arise which will cause the
Trustee to resign from its position as trustee for one or more of the
Obligations. In the event that the 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 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
Trustees, under which the administration of certain of the Obligations would be
separated from the administration of the other Obligations.

      SECTION 7.22 SURVIVAL OF TRUSTEE'S RIGHTS TO RECEIVE COMPENSATION,
REIMBURSEMENT AND INDEMNIFICATION. The Trustee's rights to receive compensation,
reimbursement and indemnification of money due and owing hereunder at the time
of the Trustee's resignation or removal shall survive the Trustee's resignation
or removal.

      SECTION 7.23 CORPORATE TRUSTEE REQUIRED; ELIGIBILITY; CONFLICTING
INTERESTS. There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee under TIA Section 310(a)(1), shall have a combined
capital and surplus of at least $50,000,000 and be an "eligible lender" under
the Act. If such corporation publishes reports of condition at least annually,
pursuant to law or the requirements of federal, state, territorial or District
of Columbia supervising or examining authority, then for the purposes of this
Section 7.23, the combined capital and surplus of such corporation shall be
deemed to be its combined capital and surplus as

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set forth in its most recent report of condition so published. If at any time
the Trustee shall cease to be eligible in accordance with the provisions of this
Section 7.23, it shall resign immediately in the manner and with the effect
hereinafter specified in this Article VII. Neither the Issuer nor any Person
directly or indirectly controlling or controlled by, or under common control
with, the Issuer shall serve as Trustee.

      SECTION 7.24 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 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
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:

            (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 Trustee (including any claim for the
      reasonable fees, compensation, expenses, disbursements and advances of the
      Trustee and its agents and counsel) and of the Registered Owners 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 Registered Owner of Notes to make such payments to the Trustee, and
      if the Trustee shall consent to the making of such payments directly to
      the Registered Owners, to pay to the Trustee any amount due to it for the
      reasonable fees, compensation, expenses, disbursements and advances of the
      Trustee and any predecessor Trustee, their agents and counsel, and any
      other amounts due the Trustee or any predecessor Trustee.

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

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

      SECTION 7.25 DETERMINATION OF LIBOR. On each LIBOR Determination Date, the
Trustee shall determine each applicable rate of LIBOR as set forth in the
definition of One-

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Month LIBOR and shall advise the Administrator and the Back-up Administrator of
each such determination.

                                  ARTICLE VIII

                             SUPPLEMENTAL INDENTURES

      SECTION 8.01 SUPPLEMENTAL INDENTURES NOT REQUIRING CONSENT OF REGISTERED
OWNERS OR COUNTERPARTIES. The Issuer and the Trustee may, without the consent of
or notice to any of the Registered Owners of any Obligations or any Counterparty
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 formal defect or omission in this
      Indenture;

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

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

            (d)   to modify, amend or supplement this Indenture or any indenture
      supplemental hereto in such manner as to permit the qualification hereof
      and thereof under the Trust Indenture Act of 1939 or any similar federal
      statute hereafter in effect or to permit the qualification of the 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 indenture supplemental hereto
      such other terms, conditions and provisions as may be permitted by said
      Trust Indenture Act of 1939 or similar federal statute;

            (e)   to evidence the appointment of a separate or co-Trustee or a
      co-registrar or transfer agent or the succession of a new 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 be necessary or desirable to assure implementation of the
      Program in conformance with the Act if along with such Supplemental
      Indenture there is filed an opinion of counsel to the effect that the
      addition or amendment of such provisions will in no way impair the
      existing security of the Registered Owners of any 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
      Trustee are not to the prejudice of the Registered Owner 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;

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            (i)   to make the terms and provisions of this Indenture, including
      the lien and security interest granted herein, applicable to the
      Derivative Product Agreements, and to modify Section 3.03 hereof with
      respect to any particular Derivative Product Agreement;

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

            (k)   to make any other change which, in the judgment of the Trustee
      is not to the material prejudice of the Registered Owners of any
      Obligations or any Counterparty;

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

      SECTION 8.02 SUPPLEMENTAL INDENTURES REQUIRING CONSENT OF REGISTERED
OWNERS AND COUNTERPARTIES. (a) Registered Owners of Notes. Exclusive of
Supplemental Indentures covered by Section 8.01 hereof and subject to the terms
and provisions contained in this Section, and not otherwise, the Registered
Owners of not less than a majority of the collective aggregate principal amount
of the Obligations then Outstanding shall have the right, from time to time, to
consent to and approve the execution by the Issuer and the Trustee of such other
indenture or indentures supplemental hereto as shall be deemed necessary and
desirable by the 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 shall permit, or be construed as permitting (a)
without the consent of the Registered Owners of all then Outstanding
Obligations, (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 such 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 Trustee without the prior
written approval of the Trustee.

      If at any time the Issuer shall request the Trustee to enter into any such
Supplemental Indenture for any of the purposes of this Section, the 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 Registered Owner of an Obligation at the
address shown on the registration books or listed in any Derivative Product
Agreement. 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
Trustee for inspection by all Registered Owners. If, within 60 days, or such
longer period as shall be prescribed by the Issuer, following the mailing of
such notice, the Registered Owners of not less than a majority of the collective
aggregate principal

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amount of the Obligations 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 Registered Owner 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 Trustee or the Issuer from
executing the same or from taking any action pursuant to the provisions thereof.
Upon the execution of any such Supplemental Indenture as in this Section 8.02
permitted and provided, this Indenture shall be and be deemed to be modified and
amended in accordance therewith.

      (b)   Counterparties. Neither the Issuer nor the Indenture Trustee shall
enter into any other indenture or any supplement hereto or amendments or waivers
hereto, the effect of which would have a Material Adverse Effect on the
interests of any Counterparty, without such Counterparty's prior written
consent. Except as explicitly set forth in the preceding sentence, no
Counterparty shall have any consent or voting rights under this Indenture, or
any rights to instruct the Trustee to take, or refrain from taking, any action
hereunder.

      SECTION 8.03 ADDITIONAL LIMITATION ON MODIFICATION OF INDENTURE. None of
the provisions of this Indenture (including Sections 8.01 and 8.02 hereof) shall
permit an amendment to the provisions of the Indenture which permits the
transfer of all or part of the Financed Eligible Loans 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. The Trustee may request an opinion of counsel to the
effect that an amendment or supplement to this Indenture was adopted in
conformance with this Indenture.

      SECTION 8.04 NOTICE OF DEFAULTS. Within 90 days after the occurrence of
any default hereunder with respect to the Notes, the Trustee shall transmit in
the manner and to the extent provided in TIA Section 313(c), notice of such
default hereunder known to the 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 Trustee shall be protected in withholding such notice if and so long
as an authorized officer of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Registered Owners of the
Notes. For the purpose of this Section 8.04, the term "default" means any event
which is, or after notice or lapse of time or both would become, an Event of
Default with respect to the Notes.

      SECTION 8.05 CONFORMITY WITH THE TRUST INDENTURE ACT. Every supplemental
indenture executed pursuant to this Article VIII shall conform to the
requirements of the Trust Indenture Act as then in effect.

                                   ARTICLE IX

                               GENERAL PROVISIONS

      SECTION 9.01 NOTICES. Any notice, request or other instrument required by
this Indenture to be signed or executed by the Registered Owners of Obligations
or Counterparties

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may be executed by the execution of any number of concurrent instruments of
similar tenor, and may be signed or executed by such Registered Owners of
Obligations or Counterparties in person or by agent appointed in writing. As a
condition for acting thereunder the 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 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 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
Registered Owner of Notes 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 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 Trustee may require the
actual deposit of such Note or Notes with the 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 "Principal Office" for purposes of the Indenture:

             If intended for the Issuer:

             Collegiate Funding Services Education Loan Trust 2003-B
             c/o Wilmington Trust Company, Delaware Trustee
             Rodney Square North
             1100 North Market Street
             Wilmington, Delaware
             Attention: Corporate Trust Administration
             Telephone: (302) 636-6019
             Facsimile: (302) 636-4140

             With a copy to the Administrator:

             Collegiate Funding Portfolio Administration, L.L.C.
             100 Riverside Parkway
             Suite 125
             Fredericksburg, Virginia 22406
             Attention: Kevin Landgraver
             Telephone: (540) 374-1600
             Facsimile: (540) 374-2021

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             If intended for the Trustee:

             U.S. Bank National Association
             425 Walnut Street, CN-WN-06CT
             Cincinnati, Ohio 45202
             Attention: Corporate Trust Department
             Telephone: (513) 632-2518
             Facsimile: (513) 632-3286

      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 facsimile or registered first-class mail,
postage prepaid. Each such notice, request or other communication shall be
effective when delivered by hand or received by facsimile or registered
first-class mail, postage prepaid.

      SECTION 9.02 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 Registered Owners from time to time of the Obligations and of the
Counterparties.

      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 Eligible
Loans or extension of time for payment.

      SECTION 9.03 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 9.04 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 9.05 CONSENT OF REGISTERED OWNERS BINDS SUCCESSORS. Any request or
consent of the Registered Owner or Counterparty of any Obligations given for any
of the purposes of this Indenture shall bind all future Registered Owners or
Counterparties 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 Trustee in pursuance of such request or consent.

      SECTION 9.06 NONLIABILITY OF PERSONS; NO GENERAL OBLIGATION. It is hereby
expressly made a condition of this Indenture that any agreements, covenants or
representations herein contained or contained in the Notes do not and shall
never constitute or give rise to a personal or pecuniary liability or charge
against the organizers, officers, employees, agents or trustees or the

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Administrator of the Issuer, or against the general credit of the Issuer, and in
the event of a breach of any such agreement, covenant or representation, no
personal or pecuniary liability or charge payable directly or indirectly from
the general revenues of the Issuer shall arise therefrom. Nothing contained in
this Section, however, shall relieve the Issuer from the observance and
performance of the several covenants and agreements on its part herein
contained.

      SECTION 9.07 NONPRESENTMENT OF NOTES OR INTEREST CHECKS. Should any of the
Notes or interest checks not be presented for payment when due, the 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 Registered Owners
thereof, a sum of money sufficient to pay such Notes or interest checks when the
same are presented by the Registered Owners thereof for payment. Such money
shall not be required to be invested. All liability of the Issuer to the
Registered Owners of such Notes or interest checks and all rights of such
Registered Owners against the Issuer under the Notes or interest checks or under
this Indenture shall thereupon cease and determine, and the sole right of such
Registered Owners 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 prepayment date, the 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
Trustee's responsibility for any such money shall cease upon remittance thereof
to the Issuer.

      SECTION 9.08 SECURITY AGREEMENT. This Indenture constitutes a Financing
Statement and a Security Agreement under the Uniform Commercial Code of the
States of New York and Delaware.

      SECTION 9.09 LAWS GOVERNING. It is the intent of the parties hereto that
this Indenture shall in all respects be governed by the laws of the State of New
York. This Indenture is subject to the provisions of the TIA that are required
to be part of this Indenture and shall, to the extent applicable, be governed by
such provisions.

      SECTION 9.10 SEVERABILITY. Of any covenant, agreement, waiver, or part
thereof in this Indenture contained 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 9.11 EXHIBITS. The terms of the Schedules and Exhibits, if any,
attached to this Indenture are incorporated herein in all particulars.

      SECTION 9.12 NON-BUSINESS DAYS. Except as may otherwise be provided
herein, if the date for taking any action hereunder is not a Business Day, then
such action can be taken on the next succeeding Business Day, with the same
force and effect as if taken on such required date.

      SECTION 9.13 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

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than the Trustee, the Delaware Trustee, the paying agent, if any, and the
Registered Owners of the Obligations and the Counterparties, 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 shall be for the sole
and exclusive benefit of the Trustee, the paying agent, if any, and the
Registered Owners of the Obligations and the Counterparties.

      SECTION 9.14 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 9.15 COUNTERPARTY RIGHTS. Other than rights to receive payments
hereunder and as set forth in Section 8.02 hereof, no Counterparty which shall
be in default under any Derivative Product Agreement with the Issuer shall have
any of the rights granted to a Counterparty hereunder. A Counterparty which is
in default under any Derivative Product Agreement shall however, continue to
maintain all obligations undertaken by it under the terms of its Derivative
Product Agreement.

      SECTION 9.16 DISCLOSURE OF NAMES AND ADDRESSES OF REGISTERED OWNERS.
Registered Owners of Notes, by receiving and holding the same, agree with the
Issuer and the Trustee that neither the Issuer nor the 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 Registered Owners of Notes
in accordance with TIA Section 312, regardless of the source from which such
information was derived, and that the Trustee shall not be held accountable by
reason of mailing any material pursuant to a request made under TIA Section
312(b).

      SECTION 9.17 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 Agreement.

      SECTION 9.18 FINANCED ELIGIBLE LOANS. The Issuer expects to acquire
Eligible Loans and to transfer Eligible Loans to the Trustee, in accordance with
this Indenture, which Eligible Loans, upon becoming subject to the lien of this
Indenture, constitute Financed Eligible Loans, as defined herein. If for any
reason a Financed Eligible Loan does not constitute an Eligible Loan, or ceases
to constitute an Eligible Loan, such loan shall continue to be subject to the
lien of this Indenture as a Financed Eligible Loan.

      SECTION 9.19 CONCERNING THE DELAWARE TRUSTEE. It is expressly understood
and agreed by the parties to this Indenture and the Registered Owners and the
Counterparties that (a) this Indenture is executed and delivered by the Delaware
Trustee not in its individual or personal capacity but solely in its capacity as
Delaware Trustee under the Trust Agreement on behalf of the Issuer, in the
exercise of the powers and authority conferred and vested in it as Delaware
Trustee under the Trust Agreement, subject to the protections, indemnities and
limitations from liability afforded to the Delaware Trustee thereunder; (b) the
representations, warranties,

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covenants, undertakings, agreements and obligations by the Delaware Trustee are
made and intended not as personal representations, warranties, covenants,
undertakings, agreements and obligations by Wilmington Trust Company, but are
made and intended for the purpose of only binding the Trust Estate, as defined
in the Trust Agreement, and the Issuer; (c) nothing contained herein shall be
construed as creating any liability on Wilmington Trust Company, individually or
personally, to perform any expressed or implied covenant, duty or obligation of
any kind whatsoever contained herein; and (d) under no circumstances shall
Wilmington Trust Company be personally liable for the payment of any fees,
costs, indebtedness or expenses of any kind whatsoever or be personally liable
for the breach or failure of any obligation, representation, agreement, warranty
or covenant whatsoever made or undertaken by the Delaware Trustee or Issuer
hereunder.

                                    ARTICLE X

                        PAYMENT AND CANCELLATION OF NOTES
                          AND SATISFACTION OF INDENTURE

      SECTION 10.01 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 its payment as provided in this Article.

      SECTION 10.02 SATISFACTION OF INDENTURE.

            (a)   If the Issuer shall pay, or cause to be paid, or there shall
      otherwise be paid (i) to the Registered Owners of the Notes, the principal
      of and interest on the Notes, at the times and in the manner stipulated in
      this Indenture; and (ii) to the Counterparties, all Issuer Derivative
      Payments then due, then the pledge of the Trust Estate, and all covenants,
      agreements and other obligations of the Issuer to the Registered Owners of
      Notes shall thereupon cease, terminate and become void and be discharged
      and satisfied. In such event, the Trustee shall execute and deliver to the
      Issuer all such instruments as may be desirable to evidence such discharge
      and satisfaction, and the 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. If the Issuer shall pay or cause to be paid, or there
      shall otherwise be paid, to the Registered Owners of any Outstanding Notes
      the principal of and interest on such Notes and to each Counterparty all
      Counterparty Payments then due, at the times and in the manner stipulated
      in this Indenture and in the Derivative Product Agreements, such Notes and
      the Counterparty shall cease to be entitled to any lien, benefit or
      security under this Indenture, and all covenants, agreements and
      obligations of the Issuer to the Registered Owners thereof and each
      Counterparty shall thereupon cease, terminate and become void and be
      discharged and satisfied.

            (b)   Notes or interest installments shall be deemed to have been
      paid within the meaning of Section 10.02(a) hereof if money for the
      payment thereof has been set aside and is being held in trust by the
      Trustee at the Final Maturity Date or earlier prepayment date thereof. Any
      Outstanding Note shall, prior to the Final Maturity Date or earlier

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      prepayment thereof, be deemed to have been paid within the meaning and
      with the effect expressed in Section 10.02(a) hereof if (i) such Note is
      to be prepaid on any date prior to its Final Maturity Date and (ii) the
      Issuer shall have given notice of prepayment as provided herein on said
      date, there shall have been deposited with the Trustee either money (fully
      insured by the Federal Deposit Insurance Issuer or fully collateralized by
      Governmental Obligations) in an amount which shall be sufficient, or
      Governmental Obligations (including any Governmental Obligations issued or
      held in book-entry form on the books of the Department of Treasury of the
      United States of America) the principal of and the interest on which when
      due will provide money which, together with the money, if any, deposited
      with the Trustee at the same time, shall be sufficient, to pay when due
      the principal of and interest to become due on such Note on and prior to
      the prepayment date or Final Maturity Date thereof, as the case may be.
      Notwithstanding anything herein to the contrary, however, no such deposit
      shall have the effect specified in this subsection (b) if made during the
      existence of an Event of Default, unless made with respect to all of the
      Notes then Outstanding. Neither Governmental Obligations nor money
      deposited with the Trustee pursuant to this subsection (b) nor principal
      or interest payments on any such Governmental Obligations shall be
      withdrawn or used for any purpose other than, and shall be held
      irrevocably in trust in an escrow account for, the payment of the
      principal of and interest on such Notes. Any cash received from such
      principal of and interest on such Governmental Obligations deposited with
      the Trustee, if not needed for such purpose, shall, to the extent
      practicable, be reinvested in Governmental Obligations maturing at times
      and in amounts sufficient to pay when due the principal of and interest on
      such Notes on and prior to such prepayment date or Final Maturity Date
      thereof, as the case may be, and interest earned from such reinvestments
      shall be paid over to the Issuer, as received by the Trustee, free and
      clear of any trust, lien or pledge. Any payment for Governmental
      Obligations purchased for the purpose of reinvesting cash as aforesaid
      shall be made only against delivery of such Governmental Obligations. For
      the purposes of this Section, "Governmental Obligations" shall mean and
      include only non-callable direct obligations of the Department of the
      Treasury of the United States of America or portions thereof (including
      interest or principal portions thereof), and such Governmental Obligations
      shall be of such amounts, maturities and interest payment dates and bear
      such interest as will, without further investment or reinvestment of
      either the principal amount thereof or the interest earnings therefrom, be
      sufficient to make the payments required herein, and which obligations
      have been deposited in an escrow account which is irrevocably pledged as
      security for the Notes. Such term shall not include mutual funds and unit
      investment trusts.

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

            (d)   In no event shall the Trustee deliver over to the Issuer any
      Financed Eligible Loans originated under the Act unless the Issuer is an
      Eligible Lender, if the Act

                                       88
<PAGE>

      or Regulations then in effect require the owner or holder of such Financed
      Eligible Loans to be an Eligible Lender.

            (e)   The provisions of this Section are applicable to the Notes and
      the Issuer Derivative Payments.

      SECTION 10.03 OPTIONAL PURCHASE OF ALL FINANCED ELIGIBLE LOANS. The
Administrator shall certify to and notify the Sponsor and the Trustee in
writing, within 15 days after the last Business Day of each Collection Period in
which the then outstanding Pool Balance is 10% or less of the Initial Pool
Balance, of the percentage that the then outstanding Pool Balance bears to the
Initial Pool Balance. The Sponsor shall have the option to purchase all of the
remaining Financed Eligible Loans on the date (the "Optional Purchase Date")
that is the tenth (10th) Business Day preceding the earlier of (i) the September
2021 Quarterly Distribution Date or (ii) the Quarterly Distribution Date next
succeeding the date on which the then outstanding Pool Balance is 10% or less of
the Initial Pool Balance. To exercise such option, the Sponsor shall deposit in
the Collection Fund on the Optional Purchase Date, an amount equal to the
aggregate Purchase Amount for the Financed Eligible Loans and the related rights
with respect thereto, plus the appraised value of any such other property held
by the Trust other than the Funds and Accounts, such value to be determined by
an appraiser mutually agreed upon by the Sponsor and the Trustee; provided,
however, that the Sponsor may not effect such purchase if such aggregate
Purchase Amounts do not equal or exceed the Minimum Purchase Amount.

      SECTION 10.04 AUCTION OF FINANCED ELIGIBLE LOANS. If the Sponsor does not
exercise its option to purchase all of the remaining Financed Eligible Loans
pursuant to Section 10.03, the Trustee (or its designated agent) shall, promptly
after the Business Day next succeeding the Optional Purchase Date that is the
tenth (10th) Business Day preceding the September 2021 Quarterly Distribution
Date, offer for sale all of the remaining Financed Eligible Loans, and any such
sale shall be consummated on or before such Quarterly Distribution Date (the
"Trust Auction Date"). The Trustee shall provide written notice to the Sponsor
of any such offer for sale at least three Business Days in advance of the Trust
Auction Date. Collegiate Funding Services, L.L.C. and its affiliates and third
parties may offer to purchase the trust's Student Loans in such auction. If at
least two bids are received, the Trustee (or its designated agent) shall solicit
and resolicit new bids from all participating bidders until only one bid remains
or the remaining bidders decline to resubmit bids. The Trustee shall accept the
highest of such remaining bids if it is equal to or in excess of both (i) the
Minimum Purchase Amount and (ii) the fair market value of such Financed Eligible
Loans as of the end of the Collection Period immediately preceding the Trust
Auction Date. If at least two bids are not received or the highest bid after the
resolicitation process is completed is not equal to or in excess of the higher
of the amounts described in the preceding sentence, the Trustee shall not
consummate such sale. The Trustee may consult, and, at the direction of the
Sponsor, shall consult, with a financial advisor, including an underwriter of
the Notes or the Administrator, to determine if the fair market value of the
Financed Eligible Loans has been offered. The proceeds of any such sale will be
applied to the redemption of all Notes Outstanding in accordance with Section
5.03(i) hereof. Unless requested by the Administrator, if the sale is not
completed, the Trustee may, but will not be obligated to, solicit bids for sale
of the Financed Eligible Loans with respect to future Quarterly Distribution
Dates upon terms similar to those described above. The Trustee shall be

                                       89
<PAGE>

obligated to make such solicitations, however, if requested to do so by the
Administrator. Notice of the prepayment of any Obligations resulting from a
purchase of the Financed Eligible Loans on the Optional Purchase Date or the
auction of the Financed Eligible Loans on the Trust Auction Date, shall be given
by the Trustee to the Registered Owners and the Counterparties by first-class
mail within five Business Days of such Optional Purchase Date or Trust Auction
Date.

                [Remainder of This Page Intentionally Left Blank]

                                       90
<PAGE>

      IN WITNESS WHEREOF, the Issuer has caused this Indenture to be executed in
its organizational name and behalf by its Delaware Trustee, and the Trustee, to
evidence its acceptance of the trusts hereby created, has caused this Indenture
to be executed in its organizational name and behalf, all in multiple
counterparts, each of which shall be deemed an original, and the Issuer and the
Trustee have caused this Indenture to be dated as of the date herein above first
shown.

                                       COLLEGIATE FUNDING SERVICES EDUCATION
                                       LOAN TRUST 2003-B, a Delaware
                                       statutory trust

                                       By: WILMINGTON TRUST COMPANY, not in
                                           its individual capacity or personal
                                           capacity but solely in its capacity
                                           as Delaware Trustee

                                       By: /s/ Patricia A. Evans
                                           -------------------------------------
                                       Name: Patricia A. Evans
                                       Title: Assistant Vice President

                                       U.S. BANK NATIONAL ASSOCIATION, as
                                       Trustee and as Eligible Lender Trustee
                                       under the Issuer Eligible Lender Trust
                                       Agreement

                                       By: /s/ Bill Sicking
                                           -------------------------------------
                                           Name: William E. Sicking
                                           Title: Vice President & Trust Officer

Agreed and accepted:

COLLEGIATE FUNDING PORTFOLIO
ADMINISTRATION, L.L.C.

By: /s/ Kevin Landgraver
    ---------------------------------
    Name: Kevin Landgraver
    Title: Treasurer

<PAGE>

                                     ANNEX 1

                         CERTAIN TERMS AND PROVISIONS OF
                             THE AUCTION RATE NOTES

                                    ARTICLE I

                                   DEFINITIONS

            Except as provided below in this Section, all terms which are
defined in Article I of this Indenture shall have the same meanings,
respectively, in this Annex 1 as such terms are given in Article I of this
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" shall have the meaning set forth in the Auction
Agent Agreement. Such fee shall not in any year exceed the amount set forth in
the cashflows delivered to the Rating Agencies unless the Issuer obtains a
Rating Agency Confirmation.

            "Auction Date" shall mean, initially, with respect to the Class A-3
Notes, January 5, 2004, with respect to the Class A-4 Notes, January 12, 2004,
with respect to the Class A-5 Notes, January 16, 2004, with respect to the Class
A-6 Notes, January 26, 2004, with respect to the Class A-7 Notes, January 5,
2004, with respect to the Class B-1 Notes, January 5, 2004 and with respect to
the Class B-2 Notes, January 12, 2004, and thereafter, with respect to each such
class of Auction Rate Notes, the Business Day immediately preceding the first
day of each Auction Period for such class, other than:

                                      1-1
<PAGE>

            (a)   an Auction Period commencing after the ownership of such class
      is no longer maintained in book-entry form by the Clearing Agency;

            (b)   an Auction Period commencing after the occurrence and during
      the continuance of a Payment Default; or (c) an Auction Period commencing
      less than the Applicable Number of Business Days after the cure or waiver
      of a Payment Default.

            (d)   Notwithstanding the foregoing, the Auction Date for one or
      more Auction Periods may be changed pursuant to Section 2.02(h) of this
      Annex 1.

            "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
Annex 1; 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 Maximum Rate.

            "Auction Period" shall mean the Interest Accrual Period applicable
to the Auction Rate Notes during which time the Auction Rate is determined
pursuant to Section 2.02(a) of this Annex 1, which Auction Period (after the
Initial Auction Period for such Class) initially shall consist generally of 28
days for the Class A-3 Notes, the Class A-4 Notes, the Class A-5 Notes, the
Class A-6 Notes, the Class A-7 Notes, the Class B-1 Notes and the Class B-2
Notes as the same may be adjusted pursuant to Section 2.02(g) of this Annex 1.

            "Auction Period Adjustment" shall mean an adjustment to the Auction
Period as provided in Section 2.02(g) of this Annex 1.

            "Auction Procedures" shall mean the procedures set forth in Section
2.02(a) of this Annex 1 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 Annex 1.

            "Auction Rate Distribution Date" shall mean, for each Auction Rate
Note, the Business Day immediately following the expiration of the Initial
Auction Period for such Auction Rate Note and each related Auction Period
thereafter; provided, however, if the duration of such Auction Period exceeds 90
days, then such Auction Rate Note shall have Interest Payment Dates on (x) each
Quarterly Distribution Date occurring during such Auction Period and (y) the
first Business Day immediately following the end of such Auction Period.

            "Auction Rate Noteholder" a holder of Auction Rate Notes, which, so
long as such Auction Rate Notes are maintained in Book-Entry Form, shall be the
Clearing Agency or its nominee.

                                      1-2
<PAGE>

            "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 Annex 1.

            "Bid" has the meaning set forth in Section 2.02(a)(i)(A) of this
Annex 1.

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

            "Bidder" has the meaning set forth in Section 2.02(a)(i)(A) of this
Annex 1.

            "Bond Equivalent Yield" shall mean, in respect of any security the
rate for which is quoted in The Wall Street Journal on a bank discount basis,
the "bond equivalent yield" (expressed as a percentage) for such security which
appears on Telerate's United States Treasury and Money Market Composite Page
0223, rounded up to the nearest one one-hundredth of one percent.

            "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 Clearing Agency or its nominee as Auction Rate
Noteholder, with the securities "immobilized" to the custody of the Clearing
Agency, and (c) the book entry is the record that identifies the owners of
beneficial interests in that principal and interest.

            "Broker-Dealer" shall mean (i) initially, with respect to those
classes of Auction Rate Notes specified in the applicable Broker-Dealer
Agreement, each of Banc of America Securities LLC, J.P. Morgan Securities Inc.
and Citigroup Global Markets Inc., pursuant to the applicable Broker-Dealer
Agreement and (ii) any other broker or dealer (each as defined in the Exchange
Act), commercial bank or other entity permitted by law to perform the functions
required of a Broker-Dealer set forth in the Auction Procedures 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 Annex 1 hereto and (c) has entered
into a Broker-Dealer Agreement that is in effect on the date of reference.

            "Broker-Dealer Agreement" shall mean (i) with respect to (a) Banc of
America Securities LLC, the Broker-Dealer Agreement, dated as of November 1,
2003, between The Bank of New York, as Auction Agent, and Banc of America
Securities LLC, as broker-dealer, (b) J.P. Morgan Securities Inc., the
Broker-Dealer Agreement, dated as of November 1, 2003, between The Bank of New
York, as Auction Agent, and J.P. Morgan Securities Inc., as broker dealer and
(c) Citigroup Global Markets Inc., the Broker-Dealer Agreement, dated as of
November 1, 2003, between The Bank of New York, as Auction Agent, and Citigroup
Global Markets Inc., as broker dealer and (ii) each other agreement between the
Auction Agent and a Broker-Dealer, approved by the Issuer, pursuant to which the
Broker-Dealer agrees to participate in Auctions as set forth in the Auction
Procedures, as such agreement may from time to time be

                                      1-3
<PAGE>

amended or supplemented, each of which shall be in substantially the form of the
Broker-Dealer Agreements specified in clause (i) hereof.

            "Broker-Dealer Fees" shall have the meaning ascribed to such term in
the Auction Agent Agreement. Such fee shall not in any year exceed the amount
set forth in the cashflows delivered to the Rating Agencies unless the Issuer
obtains a Rating Agency Confirmation.

            "Broker-Dealer Fee Rate" shall have the meaning ascribed to such
term in the Auction Agent Agreement.

            "Carry-Over Amount" shall mean, for any Interest Accrual 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 Accrual 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 Accrual Period based on the Net Loan Rate, together
with the unreduced portion of any such excess from prior Interest Accrual
Periods; provided that any reference to "principal" or "interest" in this
Indenture and in this Annex 1 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 November 25, 2003.

            "Commercial Paper Rate (90-day)" shall mean the rate determined at
the end of each calendar quarter using the daily average of that quarter's bond
equivalent 3-Month Financial Commercial Paper rates. The daily bond equivalent
rates are calculated from the 3-Month Financial Commercial Paper discount rates
published in the Federal Reserve's H.15 report. On weekends, holidays, and any
other day when no H.15 rates are available, the rate from the most recent
published date is used.

            "Effective Interest Rate" shall mean, with respect to any Financed
Eligible Loan, the interest rate per annum payable by the borrower as of the
last day of the calendar quarter borne by such Financed Eligible Loan after
giving effect to any reduction in such interest rate pursuant to borrower
incentives, (a) less all accrued rebate fees on such Financed Eligible 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 Eligible Loan during such
calendar quarter expressed as a percentage per annum.

            "Eligible Carry-Over Make-Up Amount" shall mean, with respect to
each Interest Accrual Period relating to the Auction Rate Notes as to which, as
of the first day of such Interest Accrual 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 Accrual 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 Accrual Periods and (b) the aggregate Carry-over Amount remaining
unpaid as of the first day of such

                                      1-4
<PAGE>

Interest Accrual Period together with interest accrued and unpaid thereon
through the end of such Interest Accrual 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 Annex 1.

            "Initial Auction Agent" shall mean the Bank of New York, a New York
banking corporation, its successors and assigns, in its capacity as auction
agent under the Initial Auction Agent Agreement.

            "Initial Auction Agent Agreement" shall mean the Auction Agent
Agreement, dated as of November 1, 2003, by and among the Issuer, the Trustee
and the Initial Auction Agent, including any amendment thereof or supplement
thereto.

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

            "Initial Auction Rate" shall mean for each class of Auction Rate
Notes, the per annum rate set forth below:

<TABLE>
<CAPTION>
                 Initial
  Class        Auction Rate
  -----        ------------
<S>            <C>
Class A-3         1.20%
Class A-4         1.20%
Class A-5         1.20%
Class A-6         1.20%
Class A-7         1.15%
Class B-1         1.25%
Class B-2         1.25%
</TABLE>

            "Initial Rate Adjustment Date" shall mean for each class of Auction
Rate Notes, the date set forth below:

                                      1-5
<PAGE>

<TABLE>
<CAPTION>
                    Initial Rate
Class             Adjustment Date
-----             ---------------
<S>               <C>
Class A-3         January 6, 2004
Class A-4         January 13, 2004
Class A-5         January 20, 2004
Class A-6         January 27, 2004
Class A-7         January 6, 2004
Class B-1         January 6, 2004
Class B-2         January 13, 2004
</TABLE>

            "Interest Accrual Period" shall mean, with respect to the Auction
Rate Notes, the Initial Auction Period and each period commencing on an Interest
Rate Adjustment Date for such Class and ending on the day before (a) the next
Interest Rate Adjustment Date for such Class or (b) the Stated Maturity of such
Class, 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 Class, the Business Day immediately preceding the date of commencement of
an Auction Period.

            "Market Agent" shall mean, with respect to those classes of Auction
Rate Notes specified in the applicable Market Agent Agreement, each of Banc of
America Securities LLC, J.P. Morgan Securities Inc. and Citigroup Global Markets
Inc. and pursuant to the applicable Market Agent Agreement, or any successor in
such capacity hereunder.

            "Market Agent Agreements" shall mean (i) the Market Agent Agreement,
dated as of November 1, 2003, between Banc of America Securities LLC, as market
agent, and the Trustee, (ii) the Market Agent Agreement, dated as of November 1,
2003, between J.P. Morgan Securities Inc., as market agent, and the Trustee and
(iii) the Market Agent Agreement, dated as of November 1, 2003, between
Citigroup Global Markets Inc., as market agent, and the Trustee, as applicable,
in each case, including any supplement thereto or amendment thereof.

            "Maximum Rate" means the least of (a) either (i) the Applicable
LIBOR Rate plus 1.50% (if the ratings assigned by Moody's and S&P 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 S&P to
the Auction Rate Notes is less than "Aaa" and "AAA" respectively) or (iii) the
Applicable LIBOR Rate plus 3.50% (if any one of the ratings assigned by Moody's
and S&P to the Auction Rate Notes is less than "A3" and "A-" respectively), (b)
16%, (c) the highest rate the Issuer may legally pay, from time to time, as
interest on the Auction Rate Notes or (d) the Net Loan Rate. 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.

                                      1-6
<PAGE>

            "Net Loan Rate" shall mean, with respect to any Interest Accrual
Period applicable to the Auction Rate Notes, the lesser of (a) the rate of
interest per annum (rounded to the next highest one one-hundredth of one
percent) equal to the applicable Commercial Paper Rate (90-day) plus 0.70% or
(b) the rate of interest per annum (rounded to the next highest one-hundredth of
one percent) equal to (i) the weighted average Effective Interest Rate of the
Financed Eligible Loans for the calendar quarter immediately preceding such
Interest Accrual Period, as determined by the Issuer on the last day of such
calendar quarter, less (ii) the sum of (x) Realized Losses in respect of the
Financed Eligible Loans for the most recently completed Collection Period and
(y) the Program Expense Percentage, as determined by the Issuer on the last day
of each calendar year. In making the determinations in (b)(i) and (ii) of this
definition of "Net Loan Rate," the Issuer 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 Issuer in (b)(i)
and (ii) of this definition of "Net Loan Rate" shall be given in writing to the
Auction Agent, the Trustee and the Broker-Dealers immediately upon their
respective calculation dates.

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

            "Order" has the meaning set forth in Section 2.02(a)(i)(A) of this
Annex 1.

            "Participant" shall mean the member of, or participant in, the
Clearing Agency that will act on behalf of an Existing Owner or a Potential
Owner.

            "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).

            "Program Expense Percentage" shall mean, the percentage that all
Program Expenses represent of the principal amount of the Notes, and which the
Issuer 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.

            "Program Expenses" shall mean the annual expenses of the Trust
comprised of the sum of the annual amount of the Servicing Fees, the
Administration Fees, the Auction Agent Fees, the Broker-Dealer Fees, the Trustee
Fees and the Delaware Trustee Fees, payable by the Issuer.

            "PSA" shall mean the Public Securities Association, its successors
and assigns.

            "Regular Record Date" shall mean the Record Date for the Auction
Rate Notes.

                                      1-7
<PAGE>

            "Sell Order" has the meaning set forth in Section 2.02(a)(i)(A) of
this Annex 1.

            "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 Annex 1.

            "Submitted Hold Order" has the meaning set forth in Section
2.02(a)(iii)(A) of this Annex 1.

            "Submitted Order" has the meaning set forth in Section
2.02(a)(iii)(A) of this Annex 1.

            "Submitted Sell Order" has the meaning set forth in Section
2.02(a)(iii)(A) of this Annex 1.

            "Substitute Auction Agent" shall mean the Person with whom the
Issuer and the 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 Annex 1 agrees with the Trustee and the Issuer to
perform the duties of the Auction Agent under this Annex 1.

            "Sufficient Bids" has the meaning set forth in Section
2.02(a)(iii)(A) of this Annex 1.

            "Variable Rate" shall mean the variable rate of interest per annum,
including the Initial Auction Rate, borne by each Class of Auction Rate Notes
during the Initial Auction Period for such Class, and each Interest Accrual
Period thereafter as such rate of interest is determined in accordance with the
provisions of Article II of this Annex 1.

                                   ARTICLE II

                               TERMS AND ISSUANCE

            Section 2.01 Auction Rate and Carry-Over Amounts. During the Initial
Auction Period, each Class of Auction Rate Notes shall bear interest at the
Initial Auction Rate for such Class. 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
Annex 1.

            For the Auction Rate Notes during the Initial Auction Period and
each Auction Period thereafter, interest at the applicable Auction Rate Notes
Interest Rate shall accrue daily

                                      1-8
<PAGE>

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 Auction 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 Auction Period shall commence on and include
the day following the expiration of the immediately preceding Auction Period and
terminate on and include the Monday, or in the case of the Class A-5 Notes the
Sunday, of the following fourth week (unless any such day is not followed by a
Business Day, in which case on the next succeeding day that is followed by a
Business Day); provided, however, that in the case of the Auction Period that
immediately follows the Initial Auction 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 Annex 1; By way of example, if an Auction Period
ordinarily would end on a Monday, but the following Tuesday is not a Business
Day, the Auction Period will end on that Tuesday and the new Auction Period will
begin on Wednesday.

            Notwithstanding the foregoing, unless otherwise specified in an
Issuer Order, if an Auction is scheduled to occur for the next Auction Period on
a date that was reasonably expected to be a Business Day, but such Auction does
not occur because such date is later not considered to be a Business Day, the
Auction shall nevertheless be deemed to have occurred, and the applicable
Auction Note Interest Rate in effect for the next Auction Period will be the
Auction Note Interest Rate in effect for the preceding Auction Period and such
Auction Period will generally be 28 days in duration, beginning on the calendar
day following the date of the deemed Auction and ending on (and including) the
applicable Monday, or in the case of the Class B-1 Notes the Tuesday (unless
such day is not followed by a Business Day, in which case on the next succeeding
day that is followed by a Business Day) of the following fourth week in the case
of the Auction Rate Notes. If the preceding Auction Period was other than
generally 28 days in duration, the Auction Note Interest Rate for the deemed
Auction will instead be the rate of interest determined by the applicable
Broker-Dealer on equivalently rated auction securities with a comparable length
of auction period.

            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 Accrual Period commencing after the
      delivery of certificates representing Auction Rate Notes pursuant to this
      Indenture shall equal the Maximum Rate; or

            (b)   if a Payment Default shall have occurred, the Auction Note
      Interest Rate on the Auction Rate Notes for the Interest Accrual Period
      commencing on or immediately after such Payment Default, and for each
      Interest Accrual Period thereafter, to and including the Interest Accrual
      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 Accrual Period.

                                      1-9
<PAGE>

            In accordance with Section 2.02(a)(iii)(B) and (C) of this Annex 1,
the Auction Agent shall promptly give written notice to the 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
Trustee shall notify the Auction Rate 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 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
Maximum Rate, then the Variable Rate applicable to such Auction Rate Notes for
that Interest Accrual Period will be the Maximum Rate and the Trustee shall
determine the carryover amount, if any, with respect to such Auction Rate Notes
for such Interest Accrual Period.

            Such Carry-over Amount shall bear interest calculated at a rate
equal to One-Month LIBOR (as determined by the Auction Agent, provided the
Trustee has received notice of One-Month LIBOR from the Auction Agent, and if
the Trustee shall not have received such notice from the Auction Agent, then as
determined by the Trustee) from the Auction Rate Distribution Date for the
Interest Accrual 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 Indenture and this
Annex 1, 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 Trustee during such Interest
Accrual Period in sufficient time for the Trustee to give notice to each Auction
Rate Noteholder of such Carry-over Amount as required in the next succeeding
sentence. Not less than four days before the Auction Rate Distribution Date for
an Interest Accrual Period with respect to which such Carry-over Amount has been
calculated by the Trustee, the Trustee shall give written notice to each Auction
Rate Noteholder the Auction Agent and the Issuer of the Carry-over Amount
applicable to each Auction Rate Noteholder's Auction Rate Note, which written
notice may accompany the payment of interest by check made to each such Auction
Rate Noteholder on such Auction Rate Distribution Date or otherwise shall be
mailed on such Auction Rate Distribution Date by first-class mail, postage
prepaid, to each such Auction Rate Noteholder at such Auction Rate Noteholder's
address as it appears on the registration records maintained by the Registrar.
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 an 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 Trustee on an Auction Rate
Note on the earliest of (i) the date of defeasance of the Auction Rate Notes or
(ii) the first occurring Auction Rate Distribution Date (or on the date of any
such optional redemption) if and to the extent that (A) the Eligible Carry-

                                      1-10
<PAGE>

over Make-Up Amount with respect to such subsequent Interest Accrual Period is
greater than zero, and (B) moneys are available pursuant to the terms of this
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 Trustee 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 Auction Rate Distribution Date if and to the extent that (i)
the Eligible Carry-over Make-Up Amount with respect to such Interest Accrual
Period is greater than zero, and (ii) on such Auction Rate Distribution Date
there are sufficient moneys in the Revenue Fund to pay all interest due on the
Auction Rate Notes on such Auction Rate Distribution Date, to redeem any Auction
Rate Notes required to be redeemed on such Auction Rate Distribution Date in
accordance with this Indenture and to fund amounts required to be added to the
Reserve Fund on such Auction Rate Distribution Date. Any Carry-over Amount (and
any interest accrued thereon) on any Auction Rate Note which is due and payable
on an Auction Rate Distribution Date, which Auction Rate Note is to be redeemed
(other than by optional redemption) on said Auction Rate Distribution Date,
shall be paid to the Auction Rate Noteholder thereof on said Auction Rate
Distribution Date to the extent that moneys are available therefor in accordance
with the provisions of this Annex 1; provided, however, that any Carry-over
Amount (and any interest accrued thereon) which is not yet due and payable on
said Auction Rate Distribution Date shall be cancelled with respect to said
Auction Rate Note that is to be redeemed (other than by optional redemption) on
said Auction Rate Distribution Date and shall not be paid on any succeeding
Auction Rate Distribution 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 Trustee on the earliest of (a) the
date of defeasance of any of the Auction Rate Notes or (b) the next occurring
Auction Rate Distribution Date or Dates, as necessary, if and to the extent that
the conditions in the second preceding sentence are satisfied. On any Auction
Rate Distribution Date on which the Trustee pays only a portion of the
Carry-over Amount (and any interest accrued thereon) on Auction Rate Notes, the
Trustee shall give written notice in the manner set forth in the immediately
preceding paragraph to the Auction Rate Noteholder of such Auction Rate Note
receiving such partial payment of the Carry-over Amount remaining unpaid on such
Auction Rate Note.

            The Auction Rate Distribution 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 Trustee in accordance with the provisions of
the immediately preceding paragraph and this Indenture, and the 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 an Auction Rate Distribution 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

                                      1-11
<PAGE>

reason such manner of determination shall be held to be invalid or
unenforceable, the Auction Note Interest Rate for the next succeeding Interest
Accrual Period, which Interest Accrual Period shall be an Auction Period, for
Auction Rate Notes shall be the applicable Maximum 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 Maximum Rate, the Maximum 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 Annex 1 and
written notice of such determination shall be given by such securities dealer to
the 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 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 Clearing Agency, 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 which
                        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 which
                        such Existing

                                      1-12
<PAGE>

                        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.

            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 Annex 1, 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 Annex 1, 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 Annex 1, 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 Annex 1, 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

                                      1-13
<PAGE>

                              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 Annex 1, if Sufficient
                        Bids have not been made.

                        (3)   Subject to the provisions of Section 2.02(a)(ii)
                  of this Annex 1, 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 Annex 1, 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.

                                      1-14
<PAGE>

                  (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)   None of the Issuer, the Trustee or 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 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 (1) 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 (1) and (2) of this
                        clause (E), if more than one Bid with different rates
                        are submitted on behalf of

                                      1-15
<PAGE>

                        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 (v) 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:

                                      1-16
<PAGE>

                        (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, 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.

                                      1-17
<PAGE>

                  (B)   Promptly after the Auction Agent has made the
            determinations pursuant to Section 2.02(a)(iii)(A) of this Annex 1,
            the Auction Agent shall advise the Trustee, the Broker-Dealers and
            the Issuer of the Maximum Rate and the All Hold Rate and the
            components thereof on the Auction Date:

                        (1)   if Sufficient Bids exist, that the Auction Rate
                  for the next succeeding Interest Accrual 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 Accrual 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 Accrual 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
            Trustee of the Auction Note Interest Rate.

            (iv)  Existing Owners shall continue to own the principal amount of
      Auction Rate Notes that are subject to Submitted Hold Orders. If the
      Maximum 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 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;

                                      1-18
<PAGE>

                        (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 (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
                  Annex 1; 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 Annex 1.

                                      1-19
<PAGE>

                  (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 Annex 1, 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

                        (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.

                                      1-20
<PAGE>

                  (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 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 Trustee, as
      applicable, of the Auction Note Interest Rate, the Maximum Rate, the All
      Hold Rate and the Non-Payment Rate shall, in the absence of manifest
      error, be binding on all other parties.

            (vii) Notwithstanding anything in this Annex 1 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
      Trustee under this Indenture and available to pay, the principal of and
      interest due on the Auction Rate Notes on the Auction Rate Distribution
      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 Trustee shall promptly notify the Auction Agent of any such
      occurrence.

            (b)   Application of Interest Payments for the Auction Rate Notes.

            (i)   The Trustee shall determine not later than 2:00 p.m., eastern
      time, on the Business Day next succeeding an Auction Rate Distribution
      Date, whether a Payment Default has occurred. If a Payment Default has
      occurred, the Trustee shall, not later than 2:15 p.m., eastern time, on
      such Business Day, send a notice thereof in substantially the form of
      Appendix A attached hereto to the Auction Agent by telecopy or similar
      means and, if such Payment Default is cured, the Trustee shall immediately
      send a notice in substantially the form of Appendix B 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 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

                                      1-21
<PAGE>

      the Auction Agent Agreement. Not later than 2:00 p.m., eastern time, on
      each Auction Date, the 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 Trustee shall, from time to time at the request of the
      Auction Agent and at the direction of an Authorized Representative,
      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, Applicable Libor
Rate, and Non-Payment Rate. The Auction Agent shall calculate the Maximum Rate,
Applicable LIBOR Rate, the Non-Payment Rate and All Hold Rate, as the case may
be, on each Auction Date and shall notify the Trustee and the Broker-Dealers of
the Maximum 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 Trustee shall determine the Maximum Rate,
Applicable LIBOR Rate, All Hold Rate and Non-Payment Rate for each such Interest
Accrual Period. The Issuer shall determine the Net Loan Rate. If the ownership
of the Auction Rate Notes is no longer maintained in Book-Entry Form by the
Clearing Agency, the Trustee shall calculate the Maximum Rate on the Business
Day immediately preceding the first day of each Interest Accrual Period after
the delivery of certificates representing the Auction Rate Notes pursuant to
this Indenture. If a Payment Default shall have occurred, the Trustee shall
calculate the Non-Payment Rate on the Interest Rate Determination Date for (i)
each Interest Accrual Period commencing after the occurrence and during the
continuance of such Payment Default and (ii) any Interest Accrual Period
commencing less than two Business Days after the cure of any Payment Default.
The determination by the Trustee or the Auction Agent, as the case may be, of
the Maximum 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 Trustee of the applicable Maximum Rate, Applicable LIBOR
Rate, and All Hold Rate.

            (d)   Notification of Rates, Amounts and Auction Rate Distribution
Dates.

            (i)   By 12:00 noon, eastern time, on the Business Day following
      each Regular Record Date, the Trustee shall determine the aggregate
      amounts of interest distributable on the next succeeding Auction Rate
      Distribution Date to the beneficial owners of Auction Rate Notes.

            (ii)  At least four days prior to any Auction Rate Distribution
      Date, the 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 Clearing
            Agency, (1) the date of such next Auction Rate Distribution Date and
            (2) the amount payable to the Auction Agent on the Auction Date
            pursuant to Section 2.02(b)(ii) of this Annex 1;

                                      1-22
<PAGE>

                  (B)   pursuant to Section 2.01 of this Annex 1, advise the
            Auction Rate Noteholders of a Class of Auction Rate Notes of any
            Carry-over Amount accruing on such Auction Rate Notes; and

                  (C)   advise the Clearing Agency, so long as the ownership of
            the Auction Rate Notes is maintained in Book-Entry Form by the
            Clearing Agency, upon request, of the aggregate amount of interest
            distributable on such next Auction Rate Distribution Date to the
            beneficial owners of each Class of the Auction Rate Notes.

            If any day scheduled to be an Auction Rate Distribution Date shall
be changed after the Trustee shall have given the notice or confirmation
referred to in clause (i) of the preceding sentence, the Trustee shall, not
later than 11:15 a.m., eastern time, on the Business Day next preceding the
earlier of the new Auction Rate Distribution Date or the old Auction Rate
Distribution Date, by such means as the 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 Clearing Agency.

            (e)   Auction Agent.

            (i)   The Bank of New York is hereby appointed as Initial Auction
      Agent to serve as agent for the Issuer in connection with Auctions. The
      Trustee and the Issuer will, and the Trustee is hereby directed to, enter
      into the Initial Auction Agent Agreement with The Bank of New York, 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 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 Annex 1 by giving
      at least 90 days' notice to the Trustee, each Broker-Dealer and the Issuer
      (30 days' written notice if the Auction Agent has not been paid its fee).
      The Auction Agent may be removed at any time by the Trustee acting at the
      written direction of (i) the Issuer or (ii) the holders of 66 2/3 of the
      aggregate principal amount of the Auction Rate Notes then Outstanding, and
      if by such Auction Rate Noteholders, by an instrument signed by the
      Trustee and filed with the Auction Agent, the Issuer and the
      Broker-Dealers upon at least 90 days' written notice. Removal of the
      Auction Agent pursuant to the preceding two sentences shall not 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.

            (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

                                      1-23
<PAGE>

      federal court or administrative body because of bankruptcy or insolvency,
      or for any other reason, the Trustee at the direction of an Authorized
      Representative, 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 willful misconduct or gross
      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 grossly negligent in ascertaining (or
      failing to ascertain) the pertinent facts.

            (f)   Broker-Dealer.

            (i)   The Auction Agent will enter into Broker-Dealer Agreements
      with Banc of America Securities LLC, J.P. Morgan Securities Inc. and
      Citigroup Global Markets Inc. as the initial Broker-Dealers with respect
      to the classes of Auction Rate Notes specified in the related
      Broker-Dealer Agreements. An Authorized Representative 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 Trustee and the Auction Agent.

            (ii)  Any Broker-Dealer may be removed at any time, at the request
      of an Authorized Representative, but there shall, at all times, be at
      least one Broker-Dealer appointed and acting as such for all classes of
      Auction Rate Notes.

            (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
      applicable 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 Trustee, the Auction Agent, the
      applicable Broker-Dealer, the applicable Market Agent, each Rating Agency
      and the Clearing Agency in substantially the form of, or containing
      substantially the information contained in, Appendix C 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.

                                      1-24
<PAGE>

            (iii) An Auction Period Adjustment shall take effect only if (A) the
      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, Appendix D attached
      hereto, authorizing the Auction Period Adjustment specified in such
      certificate along with a copy of the written consent of the applicable
      Broker-Dealer 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.

            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 applicable Market Agent, with
the written consent of an Authorized Representative 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 Annex 1 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 applicable Market Agent shall deliver a written request for consent
to such change in the length of the Auction Date to the Issuer at least 14 days
prior to the effective date of such change. If the Issuer shall have delivered
such written consent to the applicable Market Agent, such 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 Trustee, the Auction Agent,
the Issuer, the applicable Broker-Dealer, each Rating Agency and the Clearing
Agency. Such notice shall be substantially in the form of, or contain
substantially the information contained in, Appendix E 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

                                      1-25
<PAGE>

binding on the Auction Rate Noteholders of the Auction Rate Notes to which such
Variable Rate applies, and the Issuer and the 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 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 Auction Rate
Noteholder or any former Auction Rate 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.

            Section 2.04 Qualifications of Market Agent. Each Market Agent shall
be a member of the National Association of Securities Dealers, Inc., have a
capitalization of at least $50,000,000 and be authorized by law to perform all
the duties imposed upon it by this Indenture. Any Market Agent may resign and be
discharged of the duties and obligations created by this Indenture by giving at
least thirty days notice to the Issuer and the Trustee, provided that such
resignation shall not be effective until the appointment of a successor market
agent by the Issuer and the acceptance of such appointment by such successor
market agent. Any Market Agent may be replaced at the direction of the Issuer,
by an instrument signed by an Authorized Representative of the Issuer filed with
such Market Agent and the Trustee at least thirty days before the effective date
of such replacement, provided that such replacement shall not be effective until
the appointment of a successor market agent by the Issuer and the acceptance of
such appointment by such successor market agent. In the event that any Market
Agent shall be removed or be dissolved, or if the property or affairs of any
Market Agent shall be taken under the control of any state or federal court or
administrative body because of bankruptcy or insolvency, or for any other
reason, and there is no Market Agent for any class of Notes, and the Issuer
shall not have appointed its successor as Market Agent, the Trustee,
notwithstanding the provisions of this Section 2.04, shall be deemed to be the
Market Agent for such class for all purposes of this Indenture until the
appointment by the Issuer of a successor Market Agent. Nothing in this Section
2.04 shall be construed as conferring on the Trustee additional duties other
than as set forth herein.

                                      1-26

<PAGE>

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