Document:

DONAT A. FOURNIER SALARY CONTINUATION AGREEMENT

 Exhibit 10.32 
  
 THE BEVERLY NATIONAL BANK 
 SALARY CONTINUATION AGREEMENT 
  
 THIS AGREEMENT is adopted this 11th day of August, 2003, by and between THE BEVERLY NATIONAL BANK, a national bank located in Beverly, Massachusetts (the “Bank”), and DONAT A. FOURNIER (the “Executive”). 
  
 INTRODUCTION 
  
 To encourage the Executive to remain an employee of the Bank, the Bank is
willing to provide salary continuation benefits to the Executive. The Bank will pay the benefits from its general assets. 
  
 AGREEMENT 
  
 The Bank and the Executive agree as follows: 
  
 Article 1 
 Definitions

  
 Whenever used in this Agreement, the following words and
phrases shall have the meanings specified: 
  
 1.1 “Change
of Control” means the transfer of shares of the Bank’s voting common stock such that one entity or one person acquires (or is deemed to acquire when applying Section 318 of the Code) more than 50 percent of the Bank’s outstanding
voting common stock followed within twelve (12) months by the Executive’s Termination of Employment for reasons other than death, Disability or retirement. 
  

1.2 “Code” means the Internal Revenue Code of 1986, as amended. 
  
 1.3 “Disability” means the Executive’s suffering a sickness, accident or injury which has been
determined by the carrier of any individual or group disability insurance policy covering the Executive, or by the Social Security Administration, to be a disability rendering the Executive totally and permanently disabled. The Executive must submit
proof to the Bank of the carrier’s or Social Security Administration’s determination upon the request of the Bank. 
  
 1.4 “Early Termination” means the Termination of Employment before Normal Retirement Age for reasons other than Death, Disability,
Termination for Cause or following a Change of Control. 
  
 1.5
“Early Termination Date” means the month, day and year in which Early Termination occurs. 

 1.6 “Effective Date” means July 1, 2003. 
  
 1.7 “Normal Retirement Age” means the Executive attaining
age 65. 
  
 1.8 “Normal Retirement Date” means
the later of the Normal Retirement Age or Termination of Employment. 
  
 1.9 “Plan Year” means a twelve-month period commencing on July 1 and ending on June 30. The initial Plan Year shall commence on the effective date of this Agreement. 
  
 1.10 “Termination for Cause” shall be defined as set forth
in Article 5. 
  
 1.11 “Termination of
Employment” means that the Executive ceases to be employed by the Bank for any reason, voluntary or involuntary, other than by reason of a leave of absence approved by the Bank. 
  
 Article 2 
 Lifetime Benefits 
  
 2.1 Normal Retirement
Benefit. Upon Termination of Employment on or after the Normal Retirement Age for reasons other than death, the Bank shall pay to the Executive the benefit described in this Section 2.1 in lieu of any other benefit under this Agreement.

  
 2.1.1 Amount of Benefit. The annual benefit under this
Section 2.1 is $100,000 (One Hundred Thousand Dollars). The Bank’s Board of Directors, in its sole discretion, may increase the annual benefit under this Section 2.1.1; however, any increase shall require the recalculation of Schedule
A. 
  
 2.1.2 Payment of Benefit. The Bank shall pay
the annual benefit to the Executive in 12 equal monthly installments commencing with the month following the Executive’s Normal Retirement Date, paying the annual benefit to the Executive for a period of 20 years. 
  
 2.2 Early Termination Benefit. Upon Early Termination, the Bank shall
pay to the Executive the benefit described in this Section 2.2 in lieu of any other benefit under this Agreement. 
  
 2.2.1 Amount of Benefit. The benefit under this Section 2.2 is the Early Termination annual Installment set forth on Schedule A for the Plan Year
ending immediately prior to the Early Termination Date, determined by vesting the Executive in 100 percent of the Accrual Balance as set forth on Schedule A. Any increase in the annual benefit under Section 2.1.1 shall require the recalculation of
this benefit on Schedule A. This benefit is determined by calculating a 20-year fixed annuity from said Accrual Balance, crediting interest on the unpaid balance at an annual rate of 7 percent, compounded monthly. 
  

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 2.2.2 Payment of Benefit. The Bank shall pay the annual benefit to the Executive in 12
equal monthly installments commencing with the month following Termination of Employment, paying the annual benefit to the Executive for a period of 20 years. However, in lieu of any other benefit under this Agreement the Executive may
petition the Bank in writing to request a lump sum payable within 60 days from Termination of Employment. The Bank in its sole and absolute discretion may accept or reject such written request. 
  
 2.3 Disability Benefit. If the Executive terminates employment due to
Disability prior to Normal Retirement Age, the Bank shall pay to the Executive the benefit described in this Section 2.3 in lieu of any other benefit under this Agreement. 
  
 2.3.1 Amount of Benefit. The benefit under this Section 2.3 is the Disability annual Installment set forth on
Schedule A for the Plan Year ending immediately prior to Termination of Employment (except during the first Plan Year, the benefit is the amount set forth for Plan Year 1), determined by vesting the Executive in the Normal Retirement Benefit
described in Section 2.1.1. 
  
 2.3.2 Payment of Benefit.
The Bank shall pay the annual benefit to the Executive in 12 equal monthly installments commencing with the month following the Executive’s Normal Retirement Age, paying the annual benefit to the Executive for a period of 20 years. However, in
lieu of any other benefit under this Agreement the Executive may petition the Bank in writing to request a lump sum payable within 60 days from Termination of Employment. The Bank in its sole and absolute discretion may accept or reject such written
request. 
  
 2.4 Change of Control Benefit. Upon a
Change of Control, the Bank shall pay to the Executive the benefit described in this Section 2.4 in lieu of any other benefit under this Agreement. 
  
 2.4.1 Amount of Benefit. The benefit under this Section 2.4 is the Change of Control annual Installment set forth on Schedule A for the Plan Year
ending immediately prior to Termination of Employment occurs (except during the first Plan Year, the benefit is the amount set forth for Plan Year 1), determined by vesting the Executive in the Normal Retirement Benefit described in Section 2.1.1.

  
 2.4.2 Payment of Benefit. The Bank shall pay the
annual benefit to the Executive in 12 equal monthly installments commencing with the month following the Executive’s Normal Retirement Age, paying the annual benefit to the Executive for a period of 20 years. However, in lieu of any other
benefit under this Agreement the Executive may petition the Bank in writing to request a lump sum payable within 60 days from the Executive’s Normal Retirement Date. The Bank in its sole and absolute discretion may accept or reject such written
request. 
  
 2.4.3 Excess Parachute Payment.
Notwithstanding any provision of this Agreement to the contrary, the Bank will reduce any benefit under this Agreement by an amount necessary to avoid 
  

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 an excise tax under the excess parachute rules of Section 280G of the Code. 
  
 Article 3 
 Death Benefits 
  
 3.1 Death During Active Service. If the Executive dies while in the active service of the Bank, the Bank shall pay to the Executive’s beneficiary the benefit described in this Section 3.1. This benefit
shall be paid in lieu of the benefits under Article 2. 
  
 3.1.1
Amount of Benefit. The annual benefit under this Section 3.1 is the Normal Retirement Benefit amount described in Section 2.1.1. 
  
 3.1.2 Payment of Benefit. The Bank shall pay the annual benefit to the Executive’s beneficiary in 12 equal monthly installments commencing
with the month following the Executive’s death, paying the annual benefit to the Executive’s beneficiary for a period of 20 years. However, the Executive’s beneficiary may petition the Bank in writing to request a lump sum payable
within 60 days from Termination of Employment. The Bank in its sole and absolute discretion may accept or reject such written request. 
  
 3.2 Death During Payment of a Benefit. If the Executive dies after any benefit payments have commenced under Article 2 of this Agreement but before
receiving all such payments, the Bank shall pay the remaining benefits to the Executive’s beneficiary at the same time and in the same amounts they would have been paid to the Executive had the Executive survived. 
  
 3.3 Death After Termination of Employment But Before Payment of a Benefit
Commences. If the Executive is entitled to a benefit under Article 2 of this Agreement, but dies prior to the commencement of said benefit payments, the Bank shall pay the same benefit payments to the Executive’s beneficiary that the
Executive was entitled to prior to death except that the benefit payments shall commence on the first day of the month following the date of the Executive’s death. 
  
 Article 4 
 Beneficiaries 
  
 4.1 Beneficiary
Designations. The Executive shall designate a beneficiary by filing a written designation with the Bank. The Executive may revoke or modify the designation at any time by filing a new designation. However, designations will only be effective if
signed by the Executive and received by the Bank during the Executive’s lifetime. The Executive’s beneficiary designation shall be deemed automatically revoked if the beneficiary predeceases the Executive, or if the Executive names a
spouse as beneficiary and the marriage is subsequently dissolved. If the Executive dies without a valid beneficiary designation, all payments shall be made to the Executive’s estate. 
  
 4.2 Facility of Payment. If a benefit is payable to a minor, to a person declared incompetent, or to a person
incapable of handling the disposition of his or her property, the Bank 
  

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 may pay such benefit to the guardian, legal representative or person having the care or custody of such minor,
incompetent person or incapable person. The Bank may require proof of incompetence, minority or guardianship as it may deem appropriate prior to distribution of the benefit. Such distribution shall completely discharge the Bank from all liability
with respect to such benefit. 
  
 Article 5 
 General Limitations 
  
 5.1 Termination for Cause. Notwithstanding any provision of this Agreement to the contrary, the Bank shall not pay any benefit under this Agreement
if the Bank terminates the Executive’s employment for: 
  
 (a) Gross negligence or gross neglect of duties; 
  
 (b) Commission of a felony or of a gross misdemeanor involving moral turpitude; or 
  
 (c) Fraud, dishonesty or willful violation of any law or
significant Bank policy committed in connection with the Executive’s employment and resulting in an adverse effect on the Bank. 
  
 5.2 Suicide or Misstatement. The Bank shall not pay any benefit under this Agreement if the Executive commits suicide within three years after the
date of this Agreement. In addition, the Bank shall not pay any benefit under this Agreement if the Executive has made any material misstatement of fact on an employment application or resume provided to the Bank, or on any application for any
benefits provided by the Bank to the Executive. 
  
 Article 6

 Claims and Review Procedure 
  
 6.1 Claims Procedure. Any individual (“claimant”) who has not received benefits under the Agreement that he or she believes should be
paid shall make a claim for such benefits as follows: 
  
 6.1.1
Initiation – Written Claim. The claimant initiates a claim by submitting to the Bank a written claim for the benefits. 
  
 6.1.2 Timing of Bank Response. The Bank shall respond to such claimant within 90 days after receiving the claim. If the Bank determines that
special circumstances require additional time for processing the claim, the Bank can extend the response period by an additional 90 days by notifying the claimant in writing, prior to the end of the initial 90-day period that an additional period is
required. The notice of extension must set forth the special circumstances and the date by which the Bank expects to render its decision. 
  
 6.1.3 Notice of Decision. If the Bank denies part or all of the claim, the Bank shall notify the claimant in writing of such denial. The Bank shall
write the notification in a manner calculated to 
  

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 be understood by the claimant. The notification shall set forth: 
  
 (a) The specific reasons for the denial; 
  
 (b) A reference to the specific provisions of this Agreement
on which the denial is based; 
  
 (c) A
description of any additional information or material necessary for the claimant to perfect the claim and an explanation of why it is needed; 
  
 (d) An explanation of this Agreement’s review procedures and the time limits applicable to such procedures; and 
  
 (e) A statement of the claimant’s right to bring a
civil action under ERISA Section 502(a) following an adverse benefit determination on review. 
  
 6.2 Review Procedure. If the Bank denies part or all of the claim, the claimant shall have the opportunity for a full and fair review by the Bank of the denial, as follows: 
  
 6.2.1 Initiation – Written Request. To initiate the review, the
claimant, within 60 days after receiving the Bank’s notice of denial, must file with the Bank a written request for review. 
  
 6.2.2 Additional Submissions – Information Access. The claimant shall then have the opportunity to submit written comments, documents, records
and other information relating to the claim. The Bank shall also provide the claimant, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information relevant (as defined in applicable ERISA
regulations) to the claimant’s claim for benefits. 
  
 6.2.3
Considerations on Review. In considering the review, the Bank shall take into account all materials and information the claimant submits relating to the claim, without regard to whether such information was submitted or considered in the
initial benefit determination. 
  
 6.2.4 Timing of Bank
Response. The Bank shall respond in writing to such claimant within 60 days after receiving the request for review. If the Bank determines that special circumstances require additional time for processing the claim, the Bank can extend the
response period by an additional 60 days by notifying the claimant in writing, prior to the end of the initial 60-day period that an additional period is required. The notice of extension must set forth the special circumstances and the date by
which the Bank expects to render its decision. 
  
 6.2.5 Notice
of Decision. The Bank shall notify the claimant in writing of its decision on review. The Bank shall write the notification in a manner calculated to be understood by the claimant. The notification shall set forth: 
  
 (a) The specific reasons for the denial; 
  
 (b) A reference to the specific provisions of this Agreement
on which the denial is based; 
  
 (c) A statement
that the claimant is entitled to receive, upon request and free of charge, reasonable access to, and copies of, all documents, records and other information 
  

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 relevant (as defined in applicable ERISA regulations) to the claimant’s claim for benefits; and

  
 (d) A statement of the claimant’s right
to bring a civil action under ERISA Section 502(a). 
  
 Article
7 
 Amendments and Termination 
  
 This Agreement may be amended or terminated only by a written agreement signed by the Bank and the Executive. 
  
 Article 8 
 Miscellaneous 
  
 8.1 Binding Effect. This Agreement shall bind the Executive and the Bank, and their beneficiaries, survivors, executors, successors, administrators and transferees. 
  
 8.2 No Guarantee of Employment. This Agreement is not an employment
policy or contract. It does not give the Executive the right to remain an employee of the Bank, nor does it interfere with the Bank’s right to discharge the Executive. It also does not require the Executive to remain an employee nor interfere
with the Executive’s right to terminate employment at any time. 
  
 8.3 Non-Transferability. Benefits under this Agreement cannot be sold, transferred, assigned, pledged, attached or encumbered in any manner. 
  
 8.4 Reorganization. The Bank shall not merge or consolidate into or with another company, or reorganize, or sell
substantially all of its assets to another company, firm, or person unless such succeeding or continuing company, firm, or person agrees to assume and discharge the obligations of the Bank under this Agreement. Upon the occurrence of such event, the
term “Bank” as used in this Agreement shall be deemed to refer to the successor or survivor company. 
  
 8.5 Tax Withholding. The Bank shall withhold any taxes that are required to be withheld from the benefits provided under this Agreement.

  
 8.6 Applicable Law. The Agreement and all rights
hereunder shall be governed by the laws of the Commonwealth of Massachusetts, except to the extent preempted by the laws of the United States of America. 
  

8.7 Unfunded Arrangement. The Executive and beneficiary are general unsecured creditors of the Bank for the payment of benefits under
this Agreement. The benefits represent the mere promise by the Bank to pay such benefits. The rights to benefits are not subject in any manner to anticipation, alienation, sale, transfer, assignment, pledge, encumbrance, attachment, or garnishment
by creditors. Any insurance on the Executive’s life is a general asset of the Bank 
  

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 to which the Executive and beneficiary have no preferred or secured claim. 
  
 8.8 Entire Agreement. This Agreement constitutes the
entire agreement between the Bank and the Executive as to the subject matter hereof. No rights are granted to the Executive by virtue of this Agreement other than those specifically set forth herein. 
  
 8.9 Administration. The Bank shall have powers which are necessary to
administer this Agreement, including but not limited to: 
  
 (a) Establishing and revising the method of accounting for the Agreement; 
  
 (b) Maintaining a record of benefit payments; 
  
 (c) Establishing rules and prescribing any forms necessary or desirable to administer the Agreement; and 
  
 (d) Interpreting the provisions of the Agreement.

  
 8.10 Named Fiduciary. The Bank shall be the named
fiduciary and plan administrator under this Agreement. It may delegate to others certain aspects of the management and operational responsibilities including the employment of advisors and the delegation of ministerial duties to qualified
individuals. 
  
 IN WITNESS WHEREOF, the Executive and the Bank
have signed this Agreement. 
  

	 EXECUTIVE:
	 	 	 	 BANK:
 The Beverly
National Bank
  

				
	 	 	 	 	By	 	/s/    Alice B. Griffin
	 	 	 	 	 	

	 /s/    Donat A. Fournier

 Donat A. Fournier
	 	 	 	 	 	 Alice B. Griffin
 Title:
Director & Chair of Compensation Committee

	 	 	 	 	 	

  

 8<PAGE>
                                                                     EXHIBIT 4.1

                                                                  EXECUTION COPY

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

                               Indenture of Trust

                                  by and among

                       Education Funding Capital Trust-III

                                       and

                                Fifth Third Bank

                              as Indenture Trustee

                                       and

                                Fifth Third Bank

                        as Trust Eligible Lender Trustee

                           Dated as of October 1, 2003

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

<PAGE>

                       Education Funding Capital Trust-III

Reconciliation and tie between Trust Indenture Act of 1939 and Indenture of
Trust dated as of October 1, 2003.

Trust Indenture                                                      Indenture
  Act Section                                                         Section
---------------                                                     ------------
Section310(a)(1)&(2).............................................   6.22
          (a)(3) ................................................   N/A
          (a)(4) ................................................   6.08
          (a)(5) ................................................   6.22
          (b)    ................................................   6.20
          (c)    ................................................   N/A
Section311(a)    ............................. ..................   6.25
          (b)    ................................................   6.25
          (c)    ................................................   N/A
Section312(a)    ................................................   8.14
          (b)    ................................................   8.14
          (c)    ................................................   8.14
Section313(a)    ................................................   11.04
          (b)    ................................................   11.04
          (c)    ................................................   3.17
          (d)    ................................................   3.17
Section314(a)(1)-(3).............................................   3.17
          (a)(4) ................................................   3.18
          (b)    ................................................   3.09
          (c)    ................................................   11.06(a)
          (d)    ................................................   11.06(c)(e)
          (e)    ................................................   11.06(a)
          (f)    ................................................   11.06(k)
Section315(a)    ................................................   6.01(a),6.06
          (b)    ................................................   7.04
          (c)    ................................................   6.01(b)
          (d)(1)(2)..............................................   6.06
          (d)(3) ................................................   5.11
          (e)    ................................................   8.18
Section316(a)(1)(A)..............................................   5.11
          (a)(1)(B)..............................................   5.14
          (a)(2) ................................................   N/A
          (b)    ................................................   5.12
          (c)    ................................................   N/A
Section317(a)(1) ................................................   3.19
          (a)(2) ................................................   6.24
          (b)    ................................................   4.11
Section318(a)    ................................................   8.07

----------

Note:  This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture. Attention should also be directed to Section 318(c) of
the 1939 Act, which provides that the provisions of Sections 310 to and
including 317 of the 1939 Act are a part of and govern every qualified
indenture, whether or not physically contained therein.

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                                                              Indenture of Trust

<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.)

ARTICLE I..................................................................... 3
NOTE DETAILS, FORM OF NOTES, REDEMPTION OF NOTES AND USE OF
PROCEEDS OF NOTES............................................................. 3
     Section 1.01 Note Details................................................ 3
     Section 1.02 Payment of Principal; Redemption............................ 7
     Section 1.03 Execution of Notes.......................................... 9
     Section 1.04 Registration, Transfer and Exchange of Notes;
     Persons Treated as Noteholders........................................... 9
     Section 1.05 Lost, Stolen, Destroyed and Mutilated Notes................ 10
     Section 1.06 Indenture Trustee's Authentication Certificate............. 10
     Section 1.07 Cancellation and Destruction of Notes by the
     Indenture Trustee....................................................... 11
     Section 1.08 Temporary Notes............................................ 11
     Section 1.09 Deposit of Note Proceeds................................... 11
ARTICLE II................................................................... 12
PARITY AND PRIORITY OF LIEN; OTHER OBLIGATIONS; AND DERIVATIVE PRODUCTS...... 12
     Section 2.01 Parity and Priority of Lien................................ 12
     Section 2.02 Other Obligations.......................................... 12
     Section 2.03 Derivative Products; Counterparty Derivative
     Payments; Issuer Derivative Payments.................................... 12
ARTICLE III.................................................................. 13
PROVISIONS APPLICABLE TO THE NOTES;.......................................... 13
DUTIES OF THE ISSUER......................................................... 13
     Section 3.01 Payment of Principal, Interest and Premium................. 13
     Section 3.02 Representations and Warranties of the Issuer............... 14
     Section 3.03 Covenants as to Additional Conveyances..................... 14
     Section 3.04 Further Covenants of the Issuer............................ 14
     Section 3.05 Enforcement of the Master Servicing Agreement.............. 15
     Section 3.06 Procedures for Transfer of Funds........................... 16
     Section 3.07 Additional Covenants with Respect to the Act............... 17
     Section 3.08 Financed Student Loans; Collections Thereof;
     Assignment Thereof...................................................... 18
     Section 3.09 Opinions as to the Trust Estate............................ 18
     Section 3.10 Appointment of Agents, Etc................................. 18
     Section 3.11 Capacity to Sue............................................ 18
     Section 3.12 Continued Existence; Successor to Issuer................... 19
     Section 3.13 Amendment of Transfer and Sale Agreements.................. 19
     Section 3.14 Representations; Negative Covenants........................ 19
     Section 3.15 Additional Covenants....................................... 24
     Section 3.16 Providing of Notice........................................ 25
     Section 3.17 Reports by Issuer.......................................... 25
     Section 3.18 Statement as to Compliance................................. 25
     Section 3.19 Collection of Indebtedness and Suits for
     Enforcement by Indenture Trustee........................................ 26

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                                                              Indenture of Trust

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     Section 3.20 Representations of the Issuer Regarding the
     Indenture Trustee's Security Interest................................... 26
     Section 3.21 Covenants of the Issuer Regarding the Indenture
     Trustee's Security Interest............................................. 27
     Section 3.22 Certain Tax Forms and Treatment............................ 27
ARTICLE IV................................................................... 28
ACCOUNTS..................................................................... 28
     Section 4.01 Creation and Continuation of Trust Accounts
     and Accounts............................................................ 28
     Section 4.02 Acquisition Account........................................ 29
     Section 4.03 Collection Account......................................... 30
     Section 4.04 Distribution Account....................................... 37
     Section 4.05 Reserve Account............................................ 37
     Section 4.06 Transfers to Co-Owner Trustee.............................. 37
     Section 4.07 Capitalized Interest Account............................... 38
     Section 4.08 Investment of Funds Held by Indenture Trustee.............. 38
     Section 4.09 Indenture Trustee's Control over the Trust Accounts........ 39
     Section 4.10 Release; Sale or Exchange of Financed Student Loans........ 40
     Section 4.11 Purchase of Notes.......................................... 40
ARTICLE V.................................................................... 40
DEFAULTS AND REMEDIES........................................................ 40
     Section 5.01 Events of Default Defined.................................. 40
     Section 5.02 Remedy on Default; Possession of Trust Estate.............. 41
     Section 5.03 Remedies on Default; Advice of Counsel..................... 43
     Section 5.04 Remedies on Default; Sale of Trust Estate.................. 44
     Section 5.05 Appointment of Receiver.................................... 44
     Section 5.06 Restoration of Position.................................... 44
     Section 5.07 Purchase of Properties by Indenture Trustee or
     Noteholders............................................................. 44
     Section 5.08 Application of Sale Proceeds............................... 45
     Section 5.09 Accelerated Maturity....................................... 45
     Section 5.10 Remedies Not Exclusive..................................... 45
     Section 5.11 Direction of Indenture Trustee............................. 45
     Section 5.12 Right to Enforce in Indenture Trustee...................... 46
     Section 5.13 Physical Possession of Obligations Not Required............ 46
     Section 5.14 Waivers of Events of Default............................... 46
ARTICLE VI................................................................... 47
THE INDENTURE TRUSTEE........................................................ 47
     Section 6.01 Acceptance of Trust........................................ 47
     Section 6.02 Recitals of Others......................................... 48
     Section 6.03 As to Filing of Indenture.................................. 48
     Section 6.04 Indenture Trustee May Act Through Agents................... 48
     Section 6.05 Indemnification of Indenture Trustee....................... 48
     Section 6.06 Indenture Trustee's Right to Reliance...................... 49
     Section 6.07 Compensation of Indenture Trustee.......................... 50
     Section 6.08 Indenture Trustee May Own Notes............................ 51
     Section 6.09 Resignation of Indenture Trustee........................... 51
     Section 6.10 Removal of Indenture Trustee............................... 51
     Section 6.11 Successor Indenture Trustee................................ 52

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                                                              Indenture of Trust

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     Section 6.12 Manner of Vesting Title in Indenture Trustee............... 52
     Section 6.13 Additional Covenants by the Indenture Trustee to
     Conform to the Act...................................................... 53
     Section 6.14 Limitation with Respect to Examination of Reports.......... 53
     Section 6.15 Master Servicing Agreement................................. 53
     Section 6.16 Additional Covenants of Indenture Trustee.................. 53
     Section 6.17 Duty of Indenture Trustee with Respect to Rating
     Agencies................................................................ 54
     Section 6.18 Merger of the Indenture Trustee............................ 54
     Section 6.19 Receipt of Funds from Master Servicer...................... 55
     Section 6.20 Special Circumstances Leading to Resignation of
     Indenture Trustee....................................................... 55
     Section 6.21 Survival of Indenture Trustee's Rights to Receive
     Compensation,Reimbursement and Indemnification.......................... 55
     Section 6.22 Corporate Trustee Required; Eligibility; Conflicting
     Interests............................................................... 55
     Section 6.23 Payment of Taxes and Other Governmental Charges............ 56
     Section 6.24 Indenture Trustee May File Proofs of Claim................. 56
     Section 6.25 Preferential Collection of Claims Against Issuer........... 57
ARTICLE VII.................................................................. 57
SUPPLEMENTAL INDENTURES...................................................... 57
     Section 7.01 Supplemental Indentures Not Requiring Consent
     of Noteholders.......................................................... 57
     Section 7.02 Supplemental Indentures Requiring Consent of
     Noteholders............................................................. 59
     Section 7.03 Additional Limitation on Modification of Indenture......... 60
     Section 7.04 Notice of Defaults......................................... 60
     Section 7.05 Conformity With the Trust Indenture Act.................... 60
ARTICLE VIII................................................................. 61
GENERAL PROVISIONS........................................................... 61
     Section 8.01 Notices.................................................... 61
     Section 8.02 Covenants Bind Issuer...................................... 62
     Section 8.03 Lien Created............................................... 62
     Section 8.04 Severability of Lien....................................... 62
     Section 8.05 Consent of Noteholders Binds Successors.................... 63
     Section 8.06 Nonpresentment of Notes or Interest Checks................. 63
     Section 8.07 Laws Governing............................................. 63
     Section 8.08 Severability............................................... 63
     Section 8.09 Exhibits................................................... 63
     Section 8.10 Non-Business Days.......................................... 63
     Section 8.11 Parties Interested Herein.................................. 63
     Section 8.12 Obligations Are Limited Obligations........................ 64
     Section 8.13 Counterparty Rights........................................ 64
     Section 8.14 Disclosure of Names and Addresses of Noteholders........... 64
     Section 8.15 Aggregate Principal Amount of Obligations.................. 64
     Section 8.16 Financed Student Loans..................................... 64
     Section 8.17 Limitation of Liability of the Co-Owner Trustee............ 64
     Section 8.18 Undertaking for Costs...................................... 65
ARTICLE IX................................................................... 65
PAYMENT AND CANCELLATION OF NOTES............................................ 65
AND SATISFACTION OF INDENTURE................................................ 65
     Section 9.01 Trust Irrevocable.......................................... 65

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                                                              Indenture of Trust

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     Section 9.02 Satisfaction of Indenture.................................. 65
     Section 9.03 Cancellation of Paid Notes................................. 66
ARTICLE X.................................................................... 66
TERMINATION.................................................................. 66
     Section 10.01 Termination of the Trust.................................. 66
     Section 10.02 Notice.................................................... 66
     Section 10.03 Auction of Financed Student Loans......................... 66
ARTICLE XI................................................................... 67
REPORTING REQUIREMENTS....................................................... 67
     Section 11.01 Annual Statement as to Compliance......................... 67
     Section 11.02 Annual Independent Public Accountant's
     Servicing Report........................................................ 67
     Section 11.03 Servicer's Certificate.................................... 68
     Section 11.04 Statements to Noteholders................................. 68
     Section 11.05 Compliance Certificates and Opinions...................... 70
     Section 11.06 Incorporation by Reference of the Trust
     Indenture Act........................................................... 73

Appendix A      Definitions and Usage
Appendix B      Certain Terms and Provisions of the Auction Rate Notes

Exhibit A-1     Form of Class A Notes
Exhibit A-2     Form of Class B Notes
Exhibit B       Student Loan Acquisition Certificate

Schedule A      Student Loans to be Acquired

Exhibit C       Closing Cash Flow Projections
Exhibit D       Notice of Payment Default
Exhibit E       Notice of Cure of Payment Default
Exhibit F       Notice of Proposed Change In Length of One or More Auction
                Periods
Exhibit G       Notice Establishing Change in Length of One or More Auction
                Periods
Exhibit H       Notice of Change In Auction Date

                                        v
                                                              Indenture of Trust

<PAGE>

                               Indenture of Trust

          This Indenture of Trust, dated as of October 1, 2003 (this
"Indenture"), is by and among Education Funding Capital Trust-III, a Delaware
statutory trust (the "Issuer"), Fifth Third Bank, a banking corporation
organized under the laws of the State of Ohio, as indenture trustee (the
"Indenture Trustee"), and Fifth Third Bank, a banking corporation organized
under the laws of the State of Ohio, as trust eligible lender trustee (the
"Trust Eligible Lender Trustee"). Capitalized terms used herein and not defined
herein shall have the meanings assigned to such terms in Appendix A hereto,
which also contains rules of usage and construction that shall be applicable
herein.

                              W I T N E S S E T H:
                              - - - - - - - - - -

          Whereas, the Issuer represents that it is duly created as a Delaware
statutory trust and that it has duly authorized the execution and delivery of
this Indenture, which Indenture provides for the issuance and payment of student
loan asset-backed notes and the payments to any Counterparty; 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 Indenture Trustee has agreed to accept the trusts herein
created upon the terms herein set forth; and

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

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

                                                              Indenture of Trust

<PAGE>

                                Granting Clause A

          The Revenues (other than Revenues released from the lien of the Trust
Estate as provided herein);

                                Granting Clause B

          All moneys and investments held in the Accounts established pursuant
to Section 4.01;

                                Granting Clause C

          The Financed Student Loans;

                                Granting Clause D

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

                                Granting Clause E

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

                                Granting Clause F

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

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

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

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

                                       2
                                                              Indenture of Trust

<PAGE>

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

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

                                    Article I

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

          Section 1.01  Note Details.

          (a)     The Notes shall be issued in nine (9) separate series
consisting of $77,500,000 of Series A-1 Notes, $118,500,000 of Series A-2 Notes,
$319,000,000 of Series A-3 Notes, $100,000,000 of Series A-4 Notes, $83,750,000
of Series A-5 Notes, $83,750,000 of Series A-6 Notes, $83,750,000 of Series A-7
Notes, $83,750,000 of Series A-8 Notes, and $50,000,000 of Series B-1 Notes.

          The Series A-1 Notes will mature no later than September 15, 2008. The
Series A-2 Notes will mature no later than December 17, 2012. The Series A-3
Notes will mature no later than March 16, 2020. The Series A-4 Notes will mature
no later than December 15, 2032. The Series A-5 Notes, the Series A-6 Notes, the
Series A-7 Notes, the Series A-8 Notes, and the Series B-1 Notes will mature no
later than December 15, 2042.

          The Notes shall be issuable only as fully registered notes in
Authorized Denominations. The Notes of each Series shall be numbered separately
from 1 upwards. The Notes shall be in substantially the form set forth in
Exhibits A-1 and A-2, each with such variations, omissions and insertions as may
be necessary.

          (b)     The Auction Rate Notes shall be dated the Closing Date and
shall bear interest from the Closing Date, payable on each Auction Rate
Distribution Date, except that Auction Rate Notes that are issued upon transfer,
exchange or other replacement shall bear interest from the most recent Auction
Rate Distribution Date to which interest has been paid, or if no interest has
been paid, from the date of the Auction Rate Notes. Interest on the Auction Rate
Notes shall be computed on the basis of a 360-day year and actual days elapsed.
The terms of and definitions related to the Auction Rate Notes are found in
Appendix B. No premium payments shall be paid on the Notes issued under this
Indenture.

                                       3
                                                              Indenture of Trust

<PAGE>

          (c)     Interest shall accrue on the principal balances of the LIBOR
Notes during each Accrual Period and shall be payable on each Quarterly
Distribution Date. The LIBOR Notes shall bear interest at the annual rates
listed below:

          (i)     The Series A-1 interest rate will be three-month LIBOR, except
                  for the first Accrual Period, plus 0.04%;

          (ii)    The Series A-2 interest rate will be three-month LIBOR, except
                  for the first Accrual Period, plus 0.10%; and

          (iii)   The Series A-3 interest rate will be three-month LIBOR, except
                  for the first Accrual Period, plus 0.27%.

          For the LIBOR Notes, LIBOR for the first Accrual Period will be
determined by the Indenture Trustee by reference to straight line interpolation
between one-month LIBOR and two-month LIBOR based on the actual number of days
in the first Accrual Period.

          Interest on the LIBOR Notes will be calculated based on the actual
number of days elapsed in each Accrual Period divided by 360.

          One-month, two-month, three-month or four-month LIBOR, for any Accrual
Period, is the London interbank offered rate for deposits in U.S. Dollars having
a maturity of one month, two-months, three months or four months, as applicable,
commencing on the first day of the Accrual Period, which appears on Telerate
Page 3750 as of 11:00 a.m. London time, on the related LIBOR Determination Date.
If an applicable 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 applicable 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 Calculation Agent shall 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 Calculation Agent, 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 applicable 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, two-month,
three-month or four-month LIBOR in effect for the applicable Accrual Period
shall be the one-month, two-month, three-month or four-month LIBOR in effect for
the previous Accrual Period.

                                       4
                                                              Indenture of Trust

<PAGE>

          For this purpose:

          (i)     "LIBOR Determination Date" means, for each Accrual Period, the
                  second business day before the beginning of that Accrual
                  Period.

          (ii)    "Telerate Page 3750" means the display page so designated on
                  the Dow Jones Telerate Service or any other page that may
                  replace that page on that service for the purpose of
                  displaying comparable rates or prices.

          (iii)   "Reference Banks" means four major banks in the London
                  interbank market selected by the Calculation Agent.

          For purposes of calculating one-month, two-month, three-month and
four-month LIBOR, a business day is any day on which banks in New York City and
the City of London are open for the transaction of international business.

          (d)     The principal of each Note due at its Stated Maturity or upon
redemption in whole shall be payable at the Corporate Trust Office of the
Indenture Trustee, or at such other location as directed by the Indenture
Trustee, or at the principal office of its successor in trust upon presentation
and surrender of the Note. Payment of interest on, and principal paid in respect
of the partial redemption of, any Note shall be made to the Noteholder thereof
by check or draft mailed on the applicable Distribution Date by the Indenture
Trustee to the Noteholder at his address as it last appears on the registration
books kept by the Indenture Trustee at the close of business on the Record Date
for such Distribution Date, but any such interest not so timely paid or duly
provided for shall cease to be payable to the Noteholder thereof at the close of
business on the Record Date and shall be payable to the Noteholder thereof at
the close of business on a special record date (a "Special Record Date") for the
payment of any such defaulted interest. Such Special Record Date shall be fixed
by the Indenture Trustee whenever moneys become available for payment of the
defaulted interest, and notice of such Special Record Date shall be given to the
Noteholders of the Notes not less than ten (10) days prior thereto by
first-class mail to each such Noteholder as shown on the Indenture Trustee's
registration books on the date selected by the Indenture Trustee, stating the
date of the Special Record Date and the date fixed for the payment of such
defaulted interest. Payment of interest to the Securities Depository or its
nominee shall, and at the written request addressed to the Indenture Trustee of
any other Noteholder owning at least $1,000,000 principal amount of the Notes,
payments of interest shall, be paid by wire transfer within the United States to
the bank account number filed no later than the Record Date or Special Record
Date with the Indenture Trustee for such purpose. All payments on the Notes
shall be made in lawful money of the United States of America.

          (e)     Except as otherwise provided in this Section, the Notes in the
form of one global note for each Series shall be registered in the name of the
Securities Depository or its nominee and ownership thereof shall be maintained
in book-entry form by the Securities Depository for the account of the Agent
Members. Initially, each Note shall be registered in the name of Cede & Co., as
the nominee of The Depository Trust Company. Except as provided in subsection
(g) of this Section, the Notes may be transferred, in whole but not in part,
only to the Securities Depository or a nominee of the Securities Depository or
to a successor Securities

                                       5
                                                              Indenture of Trust

<PAGE>

Depository selected or approved by the Issuer or to a nominee of such successor
Securities Depository. Each global note shall bear a legend substantially to the
following effect: "Except as otherwise provided in the Indenture, this global
note may be transferred, in whole but not in part, only to another nominee of
the Securities Depository (as defined in the Indenture) or to a successor
Securities Depository or to a nominee of a successor Securities Depository."

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

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

                                       6
                                                              Indenture of Trust

<PAGE>

          Section 1.02  Payment of Principal; Redemption.

          (a)     Principal shall be payable on the LIBOR Notes on each
Quarterly Distribution Date in an amount equal to the Class A Noteholders'
Principal Distribution Amount.

          Principal shall be payable on the Class A Auction Rate Notes on each
Auction Rate Distribution Date in an amount equal to the Class A Noteholders'
Principal Distribution Amount. Subject to subsection (c) of this Section,
principal shall be payable on the Class B Auction Rate Notes on each Auction
Rate Distribution Date in an amount equal to the Class B Noteholders' Principal
Distribution Amount.

          (b)     Subject to subsection (c) of this Section and in accordance
with Section 4.03, principal on the Notes shall be paid or allocated on each
Quarterly Distribution Date or Monthly Allocation Date, as applicable, as
follows:

          (i)     first, to the Series A-1 Notes until their principal balances
                  are reduced to zero;

          (ii)    second, to the Series A-2 Notes until their principal balances
                  are reduced to zero;

          (iii)   third, to the Series A-3 Notes until their principal balances
                  are reduced to zero;

          (iv)    fourth, subject to any payment of principal to the Series B-1
                  Notes as described in subsection (c) of this Section, to the
                  Series A-4 Notes until their principal balances are reduced to
                  zero;

          (v)     fifth, subject to any payment of principal to the Series B-1
                  Notes as described in subsection (c) of this Section, to the
                  Series A-5 Notes until their principal balances are reduced to
                  zero;

          (vi)    sixth, subject to any payment of principal to the Series B-1
                  Notes as described in subsection (c) of this Section, to the
                  Series A-6 Notes until their principal balances are reduced to
                  zero;

          (vii)   seventh, subject to any payment of principal to the Series B-1
                  Notes as described in subsection (c) of this Section, to the
                  Series A-7 Notes until their principal balances are reduced to
                  zero;

          (viii)  eighth, subject to any payment of principal to the Series B-1
                  Notes as described in subsection (c) of this Section, to the
                  Series A-8 Notes until their principal balances are reduced to
                  zero; and

          (ix)    ninth, to the Series B-1 notes until their principal balances
                  are reduced to zero.

          However, following the occurrence of an Event of Default and the
exercise by the

                                       7
                                                              Indenture of Trust

<PAGE>

Indenture Trustee of remedies under Article V, principal payments on the Class A
Notes shall be made or set aside for future distribution pro rata, without
preference or priority.

          Any payment of principal on an Auction Rate Note shall be made by
redeeming that Auction Rate Note.

          (c)     If on any Auction Rate Distribution Date occurring while no
LIBOR Notes remain Outstanding and while Class A Auction Rate Notes remain
Outstanding, the Senior Parity Percentage is greater than the Required Senior
Parity Percentage and the Parity Percentage is greater than the Required Parity
Percentage, before any amount will be paid or allocated as principal on the
Class A Auction Rate Notes, principal shall be paid on the Class B Notes in an
amount equal to the greatest amount that can be paid as principal on the Class B
Notes without reducing the Senior Parity Percentage below the Required Senior
Parity Percentage or reducing the Parity Percentage below the Required Parity
Percentage.

          Notwithstanding the foregoing, if

          (i)     on any Distribution Date following distributions under
Sections 4.03(d)(i) through (x) or under Sections 4.03(e)(i) and (ii) to be made
on that Distribution Date, without giving effect to any payments from the
Capitalized Interest Account or Acquisition Account to the Class B Notes, the
outstanding principal balance of the Class A Notes would be in excess of:

          (1)     the outstanding principal balance of the Financed Student
                  Loans plus

          (2)     any accrued but unpaid interest on the those Financed Student
                  Loans as of the last day of the related collection period plus

          (3)     the balance on deposit in the Reserve Account on that
                  Distribution Date following those distributions minus

          (4)     the Reserve Account Requirement on that Distribution Date, or

          (ii)    an insolvency event involving the Seller or the Depositor or
an Event Of Default affecting the Class A Notes has occurred and is continuing,

then, until the conditions described in (i) or (ii) above no longer exist, the
amounts on deposit in the Collection Account and the Reserve Account shall be
applied on that Distribution Date to the payment of the Class A Noteholders'
Distribution Amount before any amounts shall be applied to the payment of the
Class B Noteholders' Distribution Amount.

          (d)     During any time while no LIBOR Notes are Outstanding, the
Auction Rate Notes are subject to redemption in whole or in part at the option
of the Issuer; provided, however, while any Class A Auction Rate Notes are
Outstanding, the Issuer may redeem Class B Auction Rate Notes only if, as of the
date of selection of Notes for redemption and after giving effect to the
redemption, the Senior Parity Percentage is at least the Required Senior Parity
Percentage and the Parity Percentage is at least the Required Parity Percentage.
If less than all outstanding Auction Rate Notes are to be redeemed, the
particular Series to be redeemed shall be determined

                                       8
                                                              Indenture of Trust

<PAGE>

by the Issuer. In the absence of direction by the Issuer, the Series of Auction
Rate Notes to be redeemed shall be selected first from the Class A Auction Rate
Notes in ascending numerical order of the Series designation (beginning with the
Series A-1 Notes), and thereafter, from the Class B Auction Rate Notes. If less
than all Outstanding Auction Rate Notes of a given Series are to be redeemed,
the particular Notes to be redeemed shall be determined by lot.

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

          Section 1.03  Execution of Notes. The Notes shall be executed in the
name and on behalf of the Issuer by the manual or facsimile signature of any of
its Authorized Officers. Any Note may be signed (manually or by facsimile) or
attested on behalf of the Issuer by any person who, at the date of such act,
shall hold the proper office, notwithstanding that at the date of
authentication, issuance or delivery, such person may have ceased to hold such
office.

          Upon the execution and delivery of this Indenture, the Issuer shall
execute and deliver to the Indenture Trustee and the Indenture Trustee shall
authenticate the Notes and deliver the Notes to The Depository Trust Company;
provided, however, prior to the delivery by the Indenture Trustee of any of the
Notes, there shall have been filed with or delivered to the Indenture Trustee
the following:

          (a)     An Issuer Order authorizing the execution and delivery of this
Indenture and the issuance of the Notes.

          (b)     A duly executed copy of this Indenture.

          (c)     Rating letters from each Rating Agency confirming (i) that the
Class A Notes have been rated "AAA" by Fitch, "Aaa" by Moody's and "AAA" by S&P
and (ii) that the Series B Notes have been rated at least "A" by Fitch, "A2" by
Moody's and "A" by S&P.

          Section 1.04  Registration, Transfer and Exchange of Notes; Persons
Treated as Noteholders. The Issuer shall cause books for the registration and
for the transfer of the Notes as provided in this Indenture to be kept by the
Indenture Trustee, which is hereby appointed the transfer agent of the Issuer
for the Notes. Notwithstanding such appointment and with the prior written
consent of the Issuer, the Indenture Trustee is hereby authorized to make any
arrangements with other institutions that it deems necessary or desirable in
order that such institutions may perform the duties of transfer agent for the
Notes. Upon surrender for transfer of any Note at the Corporate Trust Office of
the Indenture Trustee, duly endorsed for transfer or accompanied by an
assignment duly executed by the Noteholder or his attorney duly authorized in
writing, the Issuer shall execute and the Indenture Trustee shall authenticate
and deliver, making all appropriate notations on its records, and causing the
same to be made on the records of its nominees, in the name of the transferee or
transferees a new fully registered Note or Notes

                                       9
                                                              Indenture of Trust

<PAGE>

of the same interest rate and for a like Series, subseries, if any, and
aggregate principal amount of the same maturity.

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

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

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

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

          Section 1.05  Lost, Stolen, Destroyed and Mutilated Notes. Upon
receipt by the Indenture Trustee of evidence satisfactory to it of the ownership
of and the loss, theft, destruction or mutilation of any Note and, in the case
of a lost, stolen or destroyed Note, of indemnity satisfactory to it, and upon
surrender and cancellation of the Note, if mutilated, (a) the Issuer shall
execute, and the Indenture Trustee shall authenticate and deliver, a new Note of
the same Series, subseries, if any, interest rate, maturity and denomination in
lieu of such lost, stolen, destroyed or mutilated Note or (b) if such lost,
stolen, destroyed or mutilated Note shall have matured or have been called for
redemption, in lieu of executing and delivering a new Note as aforesaid, the
Issuer may pay such Note. Any such new Note shall bear a number not
contemporaneously outstanding. The Person requesting any such new Note may be
required to pay all taxes and governmental charges and all expenses and charges
of the Issuer and of the Indenture Trustee in connection with the issuance of
such Note. All Notes shall be held and owned upon the express condition that, to
the extent permitted by law, the foregoing conditions are exclusive with respect
to the replacement and payment of mutilated, destroyed, lost or stolen Notes,
negotiable instruments or other securities.

          Section 1.06  Indenture Trustee's Authentication Certificate. The
Indenture Trustee's authentication certificate upon the Notes shall be
substantially in the forms provided in Exhibits A-1 and A-2. No Note shall be
secured hereby or entitled to the benefit hereof, or shall

                                       10
                                                              Indenture of Trust

<PAGE>

be valid or obligatory for any purpose, unless a certificate of authentication,
substantially in such form, has been duly executed by the Indenture Trustee at
the written direction of the Issuer; and such certificate of the Indenture
Trustee upon any Note shall be conclusive evidence and the only competent
evidence that such Note has been authenticated and delivered hereunder. The
Indenture Trustee's certificate of authentication shall be deemed to have been
duly executed by it if manually signed by an authorized officer of the Indenture
Trustee, but it shall not be necessary that the same person sign the certificate
of authentication on all of the Notes issued hereunder.

          Section 1.07  Cancellation and Destruction of Notes by the Indenture
Trustee. Whenever any Outstanding Notes are delivered to the Indenture Trustee
for the cancellation thereof pursuant to this Indenture, upon payment of the
principal amount and interest represented thereby, or for replacement pursuant
to Section 1.04, such Notes shall be promptly cancelled and, within a reasonable
time, cremated or otherwise destroyed by the Indenture Trustee and counterparts
of a certificate of destruction evidencing such cremation or other destruction
shall be furnished by the Indenture Trustee to the Issuer.

          Section 1.08  Temporary Notes. Pending the preparation of definitive
Notes, the Issuer may execute and the Indenture Trustee shall authenticate and
deliver temporary Notes. Temporary Notes shall be issuable as fully registered
Notes without coupons, of any denomination, and substantially in the form of the
definitive Notes but with such omissions, insertions and variations as may be
appropriate for temporary Notes, all as may be determined by the Issuer. Every
temporary Note shall be executed by the Issuer and be authenticated by the
Indenture Trustee upon the same conditions and in substantially the same manner,
and with like effect, as the definitive Notes. As promptly as practicable the
Issuer shall execute and shall furnish definitive Notes and thereupon temporary
Notes may be surrendered in exchange therefor without charge at the Corporate
Trust Office of the Indenture Trustee, and the Indenture Trustee shall
authenticate and deliver in exchange for such temporary Notes a like aggregate
principal amount of definitive Notes. Until so exchanged the temporary Notes
shall be entitled to the same benefits under this Indenture as definitive Notes.

     Section 1.09  Deposit of Note Proceeds. Upon the issuance and delivery of
the Notes, the Indenture Trustee shall deposit the net proceeds thereof (i.e.,
net of Underwriters' discount of $2,920,000):

     (a)  an amount equal to $977,080,000 shall be deposited to the
          Acquisition Account;

     (b)  an amount equal to $10,000,000 shall be deposited to the
          Reserve Account; and

     (c)  an amount equal to $10,000,000 shall be deposited to the
          Capitalized Interest Account.

The Indenture Trustee shall deliver a certificate to the Issuer certifying that
the deposits set forth in this Section 1.09 have been made on the Closing Date.

                                       11
                                                              Indenture of Trust

<PAGE>

                                   Article II

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

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

          Section 2.02  Other Obligations.

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

          (b)     The revenues and other moneys, Financed Student Loans,
securities, evidences of indebtedness, interests, rights and properties pledged
under this Indenture are and will be owned by the Issuer (or the Trust Eligible
Lender Trustee) free and clear of any pledge, lien, charge or encumbrance
thereon or with respect thereto prior to or of equal rank with the respective
pledges created by this Indenture, except as otherwise expressly provided
herein, and all action on the part of the Issuer to that end has been duly and
validly taken. If any Financed Student Loan is found to have been subject to a
lien at the time such Financed Student Loan was acquired, the Issuer shall cause
such lien to be released, shall purchase such Financed Student Loan from the
Trust Estate for a purchase price equal to its principal amount plus unamortized
premium, if any, and interest accrued thereon, or shall replace such Financed
Student Loan with another Student Loan with substantially identical
characteristics that shall be free and clear of liens at the time of such
replacement. Except as otherwise provided herein, the Issuer shall not create or
voluntarily permit to be created any debt, lien, or charge on the Financed
Student Loans that would be on a parity with or prior to the lien of this
Indenture; shall not do or omit to do or suffer to be done or omitted to be done
anything whatsoever whereby the lien of this Indenture or the priority of such
lien for the Obligations hereby secured might or could be lost or impaired; and
will pay or cause to be paid or will make adequate provisions for the
satisfaction and discharge of all lawful claims and demands that if unpaid might
by law be given precedence to or any equality with this Indenture as a lien or
charge upon the Financed Student Loans; provided, however, that nothing in this
subsection (b) 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, the same will endanger the
security for the Obligations; and provided further that any subordinate lien
hereon (i.e., subordinate to the lien securing the Senior Obligations and the
Subordinate Obligations) shall be entitled to no payment from the Trust Estate,
nor may any remedy be exercised with respect to such subordinate lien against
the Trust Estate until all Obligations have been paid or deemed paid hereunder.

          Section 2.03  Derivative Products; Counterparty Derivative Payments;
Issuer Derivative Payments. The Issuer hereby authorizes and directs the
Indenture Trustee to acknowledge and agree to any Derivative Product hereafter
entered into by the Issuer and a

                                       12
                                                              Indenture of Trust

<PAGE>

Counterparty under which (a) the Issuer may be required to make, from time to
time, Issuer Derivative Payments and (b) the Indenture Trustee may receive, from
time to time, Counterparty Derivative Payments for the account of the Issuer. No
Derivative Product shall be entered into unless the Indenture Trustee shall have
received a Rating Confirmation from each Rating Agency that such Derivative
Product will not adversely affect the Rating on any of the Notes. Anything in
this Indenture to the contrary notwithstanding, any Revenues representing
Counterparty Derivative Payments of a Counterparty shall not be available to
make an Issuer Derivative Payment to another Counterparty or to pay any other
amounts owed to such Counterparty pursuant to a Derivative Product.

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

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

          On or before any Derivative Payment Date with respect to which a
Issuer Derivative Payment is due in accordance with the written notification
received from the Issuer, the Indenture Trustee shall make payment to the
appropriate Counterparty from moneys in the Collection Account of the amount of
the Issuer Derivative Payment specified in such written notification of the
Issuer due on such date by the deposit or wire transfer of immediately available
funds to the credit of the account of such Counterparty specified in such
written notification of the Issuer, but only in accordance with Section 4.03.

          The Indenture Trustee shall verify the amount of each Counterparty
Derivative Payment and Issuer Derivative Paymnet.

                                   Article III

                       Provisions Applicable to the Notes;
                              Duties of the Issuer

          Section 3.01  Payment of Principal, Interest and Premium. The Issuer
covenants that it will promptly pay, but solely from the Trust Estate, the
principal of and interest, if any, on each and every Obligation issued under the
provisions of this Indenture at the places, on the dates and in the manner
specified herein and in said Obligations and any premium required for

                                       13
                                                              Indenture of Trust

<PAGE>

the retirement of said Obligations by purchase or redemption according to the
true intent and meaning thereof. The Obligations shall be and are hereby
declared to be payable from and equally secured by an irrevocable first lien on
and pledge of the properties constituting the Trust Estate, subject to the
application thereof as permitted by this Indenture, but in no event shall the
Noteholders or any holders of the Obligations have any right to possession of
any Financed Student Loans, which shall be held only by the Indenture Trustee or
its agent or bailee.

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

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

          Section 3.04  Further Covenants of the Issuer.

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

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

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

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

          (e)     The Issuer, upon written request of the Indenture Trustee,
will permit at all reasonable times the Indenture Trustee or its agents,
accountants, and attorneys, to examine and inspect the property, books of
account, records, reports, and other data relating to the Financed Student
Loans, and will furnish the Indenture Trustee such other information as it may
reasonably request. The Indenture Trustee shall be under no duty to make any
such examination

                                       14
                                                              Indenture of Trust

<PAGE>

unless requested in writing to do so by the Noteholders of not less than a
majority of the principal amount of the Notes, and unless such Noteholders shall
have offered the Indenture Trustee security and indemnity satisfactory to it
against any costs, expenses and liabilities that might be incurred thereby.

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

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

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

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

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

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

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

                                       15
                                                              Indenture of Trust

<PAGE>

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

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

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

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

          (g)     The Issuer shall cause the Master Servicer to deliver to the
                  Indenture Trustee and the Issuer, on or before March 31 of
                  each year, beginning with March 31, 2004, a certificate
                  stating that (i) a review of the activities of the Master
                  Servicer during the preceding calendar year and of its
                  performance under the Master Servicing Agreement has been made
                  under the supervision of the officer signing such certificate
                  and (ii) to the best of such officer's knowledge, based on
                  such review, the Master Servicer has fulfilled all its
                  obligations under the Master Servicing Agreement throughout
                  such year, or, there has been a default in the fulfillment of
                  any such obligation, specifying each such default known to
                  such officer and the nature and status thereof. The Issuer
                  shall send copies of such annual certificate of the Master
                  Servicer to each Rating Agency; and

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

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

                                       16
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

                                       17
                                                              Indenture of Trust

<PAGE>

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

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

          Section 3.09  Opinions as to the Trust Estate.

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

          (b)     On or before March 31, in each calendar year, beginning in
2004, the Issuer shall furnish to the Indenture Trustee and any Counterparties
an Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
refiling of this Indenture, any Supplemental Indentures and any other requisite
documents and with respect to the filing of any financing statements and
continuation statements as are necessary to maintain the lien and security
interest created by this Indenture and reciting the details of such action, or
stating that in the opinion of such counsel no such action is necessary to
maintain such lien and security interest. Such Opinion of Counsel shall also
describe the recording, filing, re-recording and refiling of this Indenture, any
Supplemental Indentures and any other requisite documents and the filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture until March 31 of the following calendar year. If the Indenture
Trustee does not receive the Opinion of Counsel required by this paragraph on or
before the date required or if such Opinion of Counsel indicates that the
security interest created by this Indenture is no longer in effect or
maintained, the Indenture Trustee shall promptly notify each Rating Agency and
each Noteholder of such event.

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

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

                                       18
                                                              Indenture of Trust

<PAGE>

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

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

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

          Section 3.14  Representations; Negative Covenants.

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

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

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

                                       19
                                                              Indenture of Trust

<PAGE>

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

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

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

          (vi)    No Proceedings. There are no proceedings, injunctions, writs,
     restraining orders or investigations to which the Issuer or any of its
     affiliates is a party pending, or, to the best of the Issuer's knowledge,
     threatened, before any court, regulatory body, administrative agency, or
     other tribunal or governmental instrumentality (A) asserting the invalidity
     of this Indenture, (B) seeking to prevent the issuance of any Notes or the
     consummation of any of the transactions contemplated by this Indenture or
     (C) seeking any determination or ruling that might materially and adversely
     affect the performance by the Issuer of its obligations under, or the
     validity or enforceability of this Indenture.

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

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

          (ix)    Taxes. The Issuer has filed (or caused to be filed) all
     federal, state, county, local and foreign income, franchise and other tax
     returns required to be filed by it through the date hereof, and has paid
     all taxes reflected as due thereon. There is no pending

                                       20
                                                              Indenture of Trust

<PAGE>

     dispute with any taxing authority that, if determined adversely to the
     Issuer, would result in the assertion by any taxing authority of any
     material tax deficiency, and the Issuer has no knowledge of a proposed
     liability for any tax year to be imposed upon its properties or assets for
     which there is not an adequate reserve reflected in its current financial
     statements.

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

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

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

          (xiii)  Valid Business Reasons; No Fraudulent Transfers. The
     transactions contemplated by this Indenture are in the ordinary course of
     the Issuer's business and the Issuer has valid business reasons for
     granting the Trust Estate pursuant to this Indenture. At the time of each
     such grant: (A) the Issuer granted the Trust Estate to the Indenture
     Trustee without any intent to hinder, delay, or defraud any current or
     future creditor of the Issuer; (B) the Issuer was not insolvent and did not
     become insolvent as a result of any such grant; (C) the Issuer was not
     engaged and was not about to engage in any business or transaction for
     which any property remaining with it was an unreasonably small capital or
     for which the remaining assets of it are unreasonably small in relation to
     its business or the transaction; (D) the Issuer did not intend to incur,
     and did not believe or should not have reasonably believed, that it would
     incur, debts beyond its ability to pay as they become due; and (E) the
     consideration received by the Issuer for the grant of the Trust Estate was
     reasonably equivalent to the value of the related grant.

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

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

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

                                       21
                                                              Indenture of Trust

<PAGE>

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

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

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

          (b)     The Issuer will not:

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

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

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

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

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

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

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

                                       22
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

          (iv)    All Filings Made. All filings (including, without limitation,
     UCC filings) necessary in any jurisdiction to give the Indenture Trustee a
     first priority perfected ownership and security interest in the Trust
     Estate, including the Financed Student Loans, have been made no later than
     the Closing Date and copies of the file-stamped financing statements shall
     be delivered to the Indenture Trustee within 5 Business Days of receipt by
     the Issuer or its agent from the appropriate secretary of state. The Issuer
     has not caused, suffered or permitted any lien, pledges, offsets, defenses,
     claims, counterclaims, charges or security interest with respect to the
     promissory notes relating to the Financed Student Loans (other than the
     security interest created in favor of the Indenture Trustee) to be created.

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

                                       23
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

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

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

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

                                       24
                                                              Indenture of Trust

<PAGE>

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

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

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

          Section 3.17  Reports by Issuer. The Issuer shall:

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

          (b)     file with the Indenture Trustee and the Commission, in
accordance with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports with respect to
compliance by the Issuer with the conditions and covenants of this Indenture as
may be required from time to time by such rules and regulations; and

          (c)     transmit by mail to the Noteholders, within 30 days after the
filing thereof with the Indenture Trustee, in the manner and to the extent
provided in TIA Section 313(c), such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (a) and (b) of
this Section 3.17 as may be required by rules and regulations prescribed from
time to time by the Commission.

          Section 3.18  Statement as to Compliance. The Issuer will deliver to
the Indenture Trustee, within 120 days after the end of each Fiscal Year, a
brief certificate from an Authorized Officer as to his knowledge of the Issuer's
compliance with all conditions and covenants under this Indenture and, in the
event of any noncompliance, specifying such noncompliance and the

                                       25
                                                              Indenture of Trust

<PAGE>

nature and status thereof. For purposes of this Section 3.18, such compliance
shall be determined without regard to any period of grace or requirement of
notice under this Indenture.

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

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

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

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

          Section 3.22  Certain Tax Forms and Treatment.

          (a)     Each Noteholder and any beneficial owner of a Note, if
required by law, shall timely furnish the Issuer or its agents any U.S. federal
income tax form or certification (such as IRS Form W-8BEN (Certification of
Foreign Status as Beneficial Owner), Form W-8IMY (Certification of Foreign
Intermediary Status) with all appropriate attachments, IRS Form W-9 (Request for
Taxpayer Identification Number and Certification), or IRS Form W-8ECI
(Certification of Foreign Person's Claim for Exemption from Withholding on
Income Effectively Connected with Conduct of a U.S. Trade or Business) or any
successors to such IRS forms) that the Issuer or its agents may reasonably
request and shall update or replace such form or certification in accordance
with its terms or its subsequent amendments. The Noteholder

                                       27
                                                              Indenture of Trust

<PAGE>

understands that the Issuer may require certification acceptable to it (a) to
permit the Issuer to make payments to it without, or at a reduced rate of,
withholding or (b) to enable the Issuer to qualify for a reduced rate of
withholding or back-up withholding in any jurisdiction from or through which the
Issuer receives payments on its assets. The Noteholder agrees to provide any
such certification that is requested by the Issuer.

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

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

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

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

                                   Article IV

                                    Accounts

          Section 4.01  Creation and Continuation of Trust Accounts and
Accounts. There are hereby created and established the following Accounts
(collectively, the "Trust Accounts"), which shall be held and maintained as
trust accounts by the Indenture Trustee in its corporate trust department for
the benefit of the Noteholders:

          (i)     Acquisition Account;

          (ii)    Collection Account;

          (iii)   Distribution Account;

          (iv)    Reserve Account; and

          (v)     Capitalized Interest Account.

                                       28
                                                              Indenture of Trust

<PAGE>

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

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

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

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

          Amounts remaining in the Acquisition Account on November 30, 2003,
after giving effect to all withdrawals from the Acquisition Account on or prior
to that date, will be transferred to the Collection Account; provided, however,
the transfer of those amounts may be delayed until a later date if the Issuer
has received a Rating Confirmation with respect to that delay.

          On each Quarterly Distribution Date occurring while any LIBOR Notes
are Outstanding, and thereafter on each Monthly Allocation Date, to the extent
amounts on deposit in the Distribution Account and allocated to the payment of
interest on the Notes, amounts on deposit in the Collection Account representing
interest receipts on the Financed Student Loans, and amounts on deposit in the
Capitalized Interest Account are insufficient to make the transfers required by
clauses (i) and (ii) of each of Sections 4.03(d) and 4.03(e), or if on the
Stated Maturity of any Series of Notes, amounts on deposit in the Distribution
Account and allocated to the payment of principal on that Series of Notes and
amounts on deposit in the Collection Account are insufficient to make the
required principal distributions to the Noteholders of that Series of Notes, to
the extent of moneys in the Acquisition Account the amount of such deficiency
shall be paid from the Acquisition Account before applying to that payment any
amounts on deposit in the Reserve Account pursuant to Section 4.05(a).

                                       29
                                                              Indenture of Trust

<PAGE>

          Amounts on deposit in the Acquisition Account may be used to pay
principal on a Note only on its Stated Maturity.

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

          Section 4.03  Collection Account.

          (a)     The Indenture Trustee shall deposit into the Collection
Account all Revenues derived from Financed Student Loans, all other Revenue
derived from moneys or assets on deposit in the Acquisition Account, the
Distribution Account, the Capitalized Interest Account and the Reserve Account,
all Counterparty Derivative Payments, moneys transferred from the Acquisition
Account or Capitalized Interest Account as provided herein, and any other
amounts to be deposited therein pursuant to and upon receipt of an Issuer Order.

          (b)     On or prior to the 15/th/ Business Day of each month, the
Indenture Trustee shall calculate the amount of interest expected to accrue on
the Class A Notes and on the Class B Notes and make the following allocations
with funds on deposit in the Collection Account:

          (i)     first, deposit into the Distribution Account for the
                  Secretary, an amount equal to the monthly rebate fee expected
                  to be payable to the Secretary from the 15/th/ day of the
                  current calendar month to the 14/th/ day of the subsequent
                  calendar month plus previously accrued and unpaid or set aside
                  amounts;

          (ii)    second, deposit into the Distribution Account for each
                  Subservicer, pro rata, an amount equal to their fees expected
                  to be payable from the 15/th/ day of the current calendar
                  month to the 14/th/ day of the subsequent calendar month plus
                  previously accrued and unpaid or set aside amounts;

          (iii)   third, deposit into the Distribution Account for the Indenture
                  Trustee, the Trust Eligible Lender Trustee, and the Owner
                  Trustee, pro rata, an amount equal to their fees expected to
                  be payable from the 15/th/ day of the current calendar month
                  to the 14/th/ day of the subsequent calendar month plus
                  previously accrued and unpaid or set aside amounts;

          (iv)    fourth, deposit into the Distribution Account, pro rata, for
                  the Auction Agent, the Broker-Dealers, the Market Agent and
                  the Calculation Agent, an amount equal to their fees expected
                  to be payable from the 15/th/ day of the current calendar
                  month to the 14/th/ day of the subsequent calendar month plus
                  previously accrued and unpaid or set aside amounts;

          (v)     fifth, deposit into the Distribution Account for the Master
                  Servicer and

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                                                              Indenture of Trust

<PAGE>

                  Administrator, pro rata, the amounts of the Master Servicing
                  Fee and Administration Fee expected to be payable from the
                  15/th/ day of the current calendar month to the 14/th/ day of
                  the subsequent calendar month plus previously accrued and
                  unpaid or set aside amounts;

          (vi)    sixth, deposit into the Distribution Account, pro rata, for
                  each Series of Class A Notes an amount equal to the sum of (i)
                  the interest expected to accrue on the Class A Notes from the
                  15/th/ day of the current calendar month to the 14/th/ day of
                  the subsequent calendar month plus previously accrued and
                  unpaid or set aside amounts, and (ii) the amount expected to
                  be payable as Scheduled Issuer Derivative Payments and
                  Specified Issuer Termination Payments under Derivative
                  Products secured on a parity with the Class A Notes; and

          (vii)   seventh, deposit into the Distribution Account for the Class B
                  Notes an amount equal to the sum of (i) the interest expected
                  to accrue on the Class B Notes from the 15/th/ day of the
                  current calendar month to the 14/th/ day of the subsequent
                  calendar month plus previously accrued and unpaid or set aside
                  amounts, and (ii) the amount expected to be payable as
                  Scheduled Issuer Derivative Payments and Specified Issuer
                  Termination Payments under Derivative Products secured on a
                  parity with the Class B Notes.

          (c)     On each Monthly Expense Payment Date, the Indenture Trustee
shall pay the following fees from amounts on deposit in the Distribution Account
and allocated to the payment of those fees, and to the extent of any
insufficiency, from amounts on deposit in the Collection Account: (i) the
monthly rebate fee payable to the Secretary, (ii) pro rata, the fees of each
Subservicer, (iii) pro rata, the fees of the Indenture Trustee, the Trust
Eligible Lender Trustee, and the Owner Trustee, (iv) pro rata, the fees of the
Auction Agent, the Broker-Dealers, the Calculation Agent and the Market Agent,
and (v) pro rata, the Master Servicing Fee and the Administration Fee; provided,
however, for so long as Education Lending Services, Inc. is the Master Servicer
and the Administrator, the Master Servicing Fee and the Administration Fee shall
be paid only if (x) the Senior Parity Percentage is not less than 103% and the
Parity Percentage is not less than 98%, calculated as of the last day of the
month preceding the month in which the Master Servicing Fee and Administration
Fee is to be paid. The Indenture Trustee shall make all payments set forth in
this Section 4.03(c) directly to the party to whom the fees are due and only
upon receipt of an invoice from such party accompanied by a written request for
payment and approval by the Administrator or the Master Servicer. The Indenture
Trustee shall withhold payment under this Section 4.03(c) until it is reasonably
satisfied that the fee to be paid is eligible for payment under the terms of
this Indenture. The monthly rebate fee payable to the Secretary shall be paid
directly to the Secretary unless the Administrator or Master Servicer submits
written evidence satisfactory to the Indenture Trustee that the rebate fee has
already been paid.

          (d)     On each Quarterly Distribution Date occurring on or before the
date on which no LIBOR Notes remain Outstanding, and thereafter on each Monthly
Allocation Date, the indenture trustee shall make the deposits and distributions
set forth in clauses (i) through

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                                                              Indenture of Trust

<PAGE>

(xix) below, and in the case of a Quarterly Distribution Date or Monthly
Allocation Date that is not an Auction Rate Distribution Date for all Auction
Rate Notes, allocations to the Distribution Account with respect to those
Auction Rate Notes (for principal and Carry-over Amounts), in the amounts and in
the order of priority shown in clauses (i) through (xix) below, except as
otherwise provided in Section 1.02(c). The Indenture Trustee shall calculate the
amounts payable as Class A Noteholders' Interest Distribution Amount and Class B
Noteholders' Interest Distribution Amounts. These deposits and distributions
shall be made from amounts on deposit in the Distribution Account and allocated
to the applicable payment; from and to the extent of the Available Funds on that
Distribution Date after payment of the fees set forth in 4.03(c); from amounts
transferred from the Capitalized Interest Account through May 31, 2005 with
respect to clauses (i) and (ii) below on that Distribution Date; from amounts
transferred from the Acquisition Account with respect to clauses (i) and (ii)
below on that Distribution Date and with respect to the payment of principal on
the Class A Notes and Class B Notes at their Stated Maturities; and from amounts
transferred from the Reserve Account with respect to clauses (i) and (ii) below
on that Distribution Date and with respect to the payment of principal on the
Class A Notes and Class B Notes at their Stated Maturities.

          (i)     Pro rata, based on the aggregate principal balance of the
                  Class A Notes entitled to distributions on this date and on
                  the amount payable as Scheduled Issuer Derivative Payments and
                  Specified Issuer Termination Payments under Derivative
                  Products secured on a parity with those Class A Notes:

                  (1)  to the Class A Noteholders, the Class A Noteholders'
                       Interest Distribution Amount, pro rata, based on the
                       amounts payable as Class A Noteholders' Interest
                       Distribution Amount, and

                  (2)  to the Counterparties under Derivative Products secured
                       on a parity with the Class A Notes, the amount payable as
                       Scheduled Issuer Derivative Payments and Specified Issuer
                       Termination Payments under each Derivative Product, pro
                       rata, based on the amounts payable by the Issuer under
                       each Derivative Product;

          (ii)    pro rata, based on the aggregate principal balance of the
                  Class B Notes entitled to distributions on this date and the
                  amount payable as Scheduled Issuer Derivative Payments and
                  Specified Issuer Termination Payments under Derivative
                  Products secured on a parity with those Class B Notes:

                  (1)  to the Class B Noteholders, the Class B Noteholders'
                       Interest Distribution Amount, pro rata, based on the
                       amounts payable as Class B Noteholders' Interest
                       Distribution Amount, and

                  (2)  to the Counterparties under Derivative Products secured
                       on a parity with the Class B Notes, the amount payable as
                       Scheduled Issuer Derivative Payments and Specified Issuer
                       Termination Payments under each Derivative Product, pro
                       rata, based on the amounts payable by the Issuer under
                       each Derivative Product;

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                                                              Indenture of Trust

<PAGE>

          (iii)   to the Series A-1 Noteholders until paid in full, the Class A
                  Noteholders' Principal Distribution Amount;

          (iv)    after the Series A-1 Notes have been paid in full, to the
                  Series A-2 Noteholders until paid in full, the Class A
                  Noteholders' Principal Distribution Amount;

          (v)     after the Series A-2 Notes have been paid in full, to the
                  Series A-3 Noteholders until paid in full, the Class A
                  Noteholders' Principal Distribution Amount;

          (vi)    after the Series A-3 Notes have been paid in full, to the
                  Class B Noteholders, subject to Section 1.02(c), the Class B
                  Noteholders' Principal Distribution Amount, and to the Series
                  A-4 Noteholders until paid in full, the Class A Noteholders'
                  Principal Distribution Amount;

          (vii)   after the Series A-4 Notes have been paid in full, to the
                  Class B Noteholders, subject to Section 1.02(c), the Class B
                  Noteholders' Principal Distribution Amount, and to the Series
                  A-5 Noteholders until paid in full, the Class A Noteholders'
                  Principal Distribution Amount;

          (viii)  after the Series A-5 Notes have been paid in full, to the
                  Class B Noteholders, subject to Section 1.02(c), the Class B
                  Noteholders' Principal Distribution Amount, and to the Series
                  A-6 Noteholders until paid in full, the Class A Noteholders'
                  Principal Distribution Amount;

          (ix)    after the Series A-6 Notes have been paid in full, to the
                  Class B Noteholders, subject to Section 1.02(c), the Class B
                  Noteholders' Principal Distribution Amount, and to the Series
                  A-7 Noteholders until paid in full, the Class A Noteholders'
                  Principal Distribution Amount;

          (x)     after the Series A-7 Notes have been paid in full, to the
                  Class B Noteholders, subject to Section 1.02(c), the Class B
                  Noteholders' Principal Distribution Amount, and to the Series
                  A-8 Noteholders until paid in full, the Class A Noteholders'
                  Principal Distribution Amount;

          (xi)    after all of the Class A Notes have been paid in full, to the
                  Class B Noteholders until paid in full, the Class B
                  Noteholders' Principal Distribution Amount;

          (xii)   to the Reserve Account, the amount, if any, necessary to
                  reinstate the balance of the Reserve Account to the Reserve
                  Account Requirement;

          (xiii)  if the Parity Percentage is not equal to at least the Required
                  Parity Percentage or the Senior Parity Percentage is not equal
                  to at least the Required Senior Parity Percentage, to the
                  Distribution Account to pay principal on the Class A Notes on
                  their next respective Distribution Dates, in the order and
                  priority described in Section 1.02(b), the least amount

                                       33
                                                              Indenture of Trust

<PAGE>

                  required to increase the Parity Percentage to at least the
                  Required Parity Percentage and the Senior Parity Percentage to
                  at least the Required Senior Parity Percentage, with those
                  percentages computed assuming that immediately prior to the
                  computation, the required payments of principal were actually
                  made on the Class A Notes;

          (xiv)   if the Parity Percentage is not equal to at least the Required
                  Parity Percentage, to the Distribution Account to pay
                  principal on the Class B Notes on their next Distribution
                  Date, the least amount required to increase the Parity
                  Percentage to at least the Required Parity Percentage, with
                  that percentage computed assuming that immediately prior to
                  the computation, the required payments of principal were
                  actually made on the Class B Notes;

          (xv)    to the Distribution Account to be paid on the next respective
                  Distribution Dates for the Class A Auction Rate Notes, pro
                  rata, any Class A Carry-over Amounts;

          (xvi)   to the Distribution Account to be paid on the next respective
                  Distribution Dates for the Class B Auction Rate Notes, any
                  Class B Carry-over Amounts;

          (xvii)  pro rata, based on the amount of any Other Issuer Termination
                  Payments due pursuant to this clause, to the Counterparties
                  under each Derivative Product secured on a parity with the
                  Class A Notes, the amount of any Other Issuer Termination
                  Payments due and payable;

          (xviii) pro rata, based on the amount of any Other Issuer Termination
                  Payments due pursuant to this clause, to the Counterparties
                  under each Derivative Product secured on a parity with the
                  Class B Notes, the amount of any Other Issuer Termination
                  Payments due and payable; and

          (xix)   to the Co-Owner Trustee for deposit into the Certificate
                  Distribution Account, any remaining amounts after application
                  of the preceding clauses if, and after giving effect to the
                  transfer of any amounts to the Co-Owner Trustee, the Parity
                  Percentage is equal to at least the Required Parity Percentage
                  and the Senior Parity Percentage is equal to at least the
                  Required Senior Parity Percentage; provided, however, that
                  after November 1, 2020, amounts may be transferred to the
                  Co-Owner Trustee pursuant to this clause only if, after giving
                  effect to that transfer, the Value of the Trust Estate is at
                  least $50,000 greater than the Value thereof required to cause
                  both the Parity Percentage to equal or exceed the Required
                  Parity Percentage and the Senior Parity Percentage to equal or
                  exceed the Required Senior Parity Percentage; provided
                  further, that amounts may only be released to the Co-Owner
                  Trustee pursuant to this clause (xix) quarterly following the
                  review required by Section 7(b)(viii) of the Administration
                  Agreement.

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                                                              Indenture of Trust

<PAGE>

          On each Quarterly Distribution Date that is not an Auction Rate
Distribution Date, in lieu of making payments on that date of principal and
Carry-over Amounts to the Auction Rate Notes that do not have a Distribution
Date on such Quarterly Distribution Date, these amounts shall be deposited into
the Distribution Account.

          (e)     On each Auction Rate Distribution Date that is not a Quarterly
Distribution Date or Monthly Allocation Date, the Indenture Trustee shall make
the following distributions:

          (i)     first, from amounts deposited in the Distribution Account that
                  were allocated to the Class A Auction Rate Notes with a
                  Distribution Date on this Auction Rate Distribution Date and
                  to Counterparties under Derivative Products secured on a
                  parity with those Class A Auction Rate Notes, and then from
                  amounts on deposit in the Collection Account, pro rata, based
                  on the aggregate principal balance of those Class A Auction
                  Rate Notes and the amount payable as Scheduled Issuer
                  Derivative Payments and Specified Issuer Termination Payments
                  under each Derivative Product secured on a parity with those
                  Class A Auction Rate Notes:

                  (1)  to the Noteholders of those Class A Auction Rate Notes,
                       the Class A Noteholders' Interest Distribution Amount,
                       pro rata, based on the amounts payable as Class A
                       Noteholders' Interest Distribution Amount, and

                  (2)  to the Counterparties under Derivative Products secured
                       on a parity with those Class A Auction Rate Notes, the
                       amount payable as Scheduled Issuer Derivative Payments
                       and Specified Issuer Termination Payments under each
                       Derivative Product, pro rata, based on the amounts
                       payable by the Issuer under each Derivative Product; and

                                       35
                                                              Indenture of Trust

<PAGE>

          (ii)    second, from amounts deposited in the Distribution Account
                  that were allocated to the Class B Auction Rate Notes with a
                  Distribution Date on this Auction Rate Distribution Date and
                  to Counterparties under Derivative Products secured on a
                  parity with those Class B Auction Rate Notes, and then from
                  amounts on deposit in the Collection Account, pro rata, based
                  on the aggregate principal balance of those Class B Auction
                  Rate Notes and the amount payable as Scheduled Issuer
                  Derivative Payments and Specified Issuer Termination Payments
                  under each Derivative Product secured on a parity with those
                  Class B Auction Rate Notes:

                  (1)  to the Noteholders of those Class B Auction Rate Notes,
                       the Class B Noteholders' Interest Distribution Amount,
                       pro rata, based on the amounts payable as Class B
                       Noteholders' Interest Distribution Amount, and

                  (2)  to the Counterparties under Derivative Products secured
                       on a parity with those Class B Auction Rate Notes, the
                       amount payable as Scheduled Issuer Derivative Payments
                       and Specified Issuer Termination Payments under each
                       Derivative Product, pro rata, based on the amounts
                       payable by the Issuer under each Derivative Product.

          Amounts on deposit in the Distribution Account with respect to
principal and Carry-over Amounts allocated to the Auction Rate Notes will be
paid on the Auction Rate Notes on their Auction Rate Distribution Dates.

          Notwithstanding the foregoing, in the event the Financed Student Loans
are not sold as described in Section 10.03, on each subsequent Distribution Date
on which the Pool Balance is equal to 10% or less of the initial Pool Balance,
the Indenture Trustee shall distribute as accelerated payments of principal on
the Notes all amounts that would otherwise be paid to the Co-Owner Trustee for
deposit into the Certificate Distribution Account.

          (f)     As long as any Class A Notes remain Outstanding, the order of
payments in subsections (d) and (e) of this Section will be modified if, after
giving effect to the payments on any Distribution Date, a payment Event of
Default has occurred under this Indenture (in which event amounts will be
applied as provided herein with respect to Events of Default).

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

                                       36
                                                              Indenture of Trust

<PAGE>

          Section 4.04 Distribution Account.

          The Indenture Trustee shall deposit into the Distribution Account all
amounts required to be deposited therein pursuant to Section 4.03(b). The
Indenture Trustee shall use amounts on deposit in the Distribution Account to
make the distributions pursuant to Sections 4.03(c), (d) and (e).

          Section 4.05  Reserve Account.

          (a)     On each Quarterly Distribution Date occurring while any LIBOR
Notes are Outstanding, and thereafter on each Monthly Allocation Date, to the
extent there are insufficient moneys in the Distribution Account or Collection
Account to make the transfers required by clauses (i) and (ii) of each of
Sections 4.03(d) and 4.03(e), and after the transfer of amounts from the
Capitalized Interest Account as provided in Section 4.07, the amount of such
deficiency shall be paid directly from the Reserve Account.

          (b)     Money in the Reserve Account may be used to pay principal on a
Note only on its Stated Maturity.

          (c)     If the Reserve Account is used for the purposes described in
Section 4.05(a) and (b), the Indenture Trustee shall restore the Reserve Account
to the Reserve Account Requirement by transfers from the Collection Account on
the next Quarterly Distribution Date or Monthly Allocation Date, as applicable,
pursuant to Section 4.03(d)(xii). If the full amount required to restore the
Reserve Account to the Reserve Account Requirement is not available in the
Collection Account on such next succeeding Quarterly Distribution Date or
Monthly Allocation Date, as applicable, the Indenture Trustee shall continue to
transfer funds from the Collection Account as they become available and in
accordance with Section 4.03(d)(xii) until the deficiency in the Reserve Account
has been eliminated.

          (d)     On any day that the amount in the Reserve Account exceeds the
Reserve Account Requirement, the Indenture Trustee shall transfer the excess to
the Collection Account.

          (e)     On the date of redemption of all of the Notes, at the
direction of the Issuer, the Indenture Trustee shall transfer all moneys in the
Reserve Account to the Collection Account.

          If at any time the balance in the Reserve Account, together with other
available funds of the Issuer on deposit with the Indenture Trustee, shall be
sufficient to retire all Notes Outstanding, the Issuer shall direct the
Indenture Trustee to apply that balance to retire all Notes Outstanding.

          Section 4.06  Transfers to Co-Owner Trustee. Transfers from the
Collection Account to the Co-Owner Trustee may be made in accordance with
Section 4.03(d)(xix); provided, however, that no transfer of assets to the
Co-Owner Trustee shall be made if there is not on deposit in the Reserve Account
an amount equal to at least the Reserve Account Requirement; and further
provided, that no transfer shall be made to the Co-Owner Trustee unless
immediately after taking into account any such transfer, the Parity Percentage
is at least

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                                                              Indenture of Trust

<PAGE>

equal to the Required Parity Percentage and the Senior Parity Percentage is at
least equal to the Required Senior Parity Percentage.

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

          Section 4.07  Capitalized Interest Account. On each Quarterly
Distribution Date occurring while any LIBOR Notes are Outstanding, and
thereafter on each Monthly Allocation Date, to the extent moneys on deposit in
the Distribution Account allocated to the payment of interest on the Notes and
moneys on deposit in the Collection Account representing interest payments on
the Financed Student Loans are insufficient to make the transfers required by
clauses (i) and (ii) of each of Sections 4.03(d) and 4.03(e), to the extent of
moneys in the Capitalized Interest Account the amount of such deficiency shall
be paid from the Capitalized Interest Account before any amounts on deposit in
the Collection Account representing principal payments on the Financed Student
Loans are used to pay such deficiency and before applying to that payment
amounts on deposit in the Acquisition Account pursuant to Section 4.02 or
amounts on deposit in the Reserve Account pursuant to Section 4.05(a). Amounts
remaining in the Capitalized Interest Account on May 31, 2005, after giving
effect to all withdrawals from the Capitalized Interest Account on or prior to
that date, will be transferred to the Collection Account and, subject to the
Rating Agency Condition, may be transferred to the Collection Account on an
earlier date.

          Section 4.08  Investment of Funds Held by Indenture Trustee. The
Indenture Trustee shall invest money held for the credit of any Account or
Subaccount held by the Indenture Trustee hereunder as directed in writing by an
Authorized Officer of the Issuer, to the fullest extent practicable and
reasonable, in Eligible Investments that shall mature or be redeemed prior to
the respective dates when the money held for the credit of such Account or
Subaccount will be required for the purposes intended. In the absence of any
such direction and to the extent practicable, the Indenture Trustee shall invest
amounts held hereunder in those Eligible Investments described in clause (a) of
the definition of the Eligible Investments. The Indenture Trustee and the Issuer
hereby agree that unless an Event of Default shall have occurred hereunder, the
Issuer acting by and through an Authorized Officer shall be entitled to, and
shall, provide written direction or oral direction confirmed in writing to the
Indenture Trustee with respect to any discretionary acts required or permitted
of the Indenture Trustee under any Eligible Investments and the Indenture
Trustee shall not take such discretionary acts without such written direction.
The Indenture Trustee shall verify that all investments of moneys held in any
Account or Subaccount held by the Indenture Trustee constitute Eligible
Investments.

          The Eligible Investments purchased with moneys held for the credit of
any Account or Subaccount shall be held by the Indenture Trustee and shall be
deemed at all times to be part of such Account or Subaccount, and the Indenture
Trustee shall inform the Issuer of the details of all such investments. Upon
direction in writing from an Authorized Officer of the Issuer, the Indenture
Trustee shall use its best efforts to sell at the best price obtainable, or
present for redemption, any Eligible Investments purchased by it as an
investment whenever it shall be necessary to provide money to meet any payment
from the applicable Account or Subaccount. The Indenture Trustee shall advise
the Issuer in writing, on or before the 15/th/ day of each calendar month (or
such later date as reasonably consented to by the Issuer), of all

                                       38
                                                              Indenture of Trust

<PAGE>

investments held for the credit of each Account and Subaccount in its custody
under the provisions of this Indenture as of the end of the preceding month and
the value thereof, and shall list any investments that were sold or liquidated
for less than their Value at the time thereof.

          Money in any Account or Subaccount constituting a part of the Trust
Estate may be pooled for the purpose of making investments and may be used to
pay accrued interest on Eligible Investments purchased. Money in any Account or
Subaccount constituting a part of the Trust Estate may not be pooled with money
held outside of the Trust Estate for the purpose of making investments. The
Indenture Trustee and its affiliates may act as principal or agent in the
acquisition or disposition of any Eligible Investments.

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

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

          Section 4.09  Indenture Trustee's Control over the Trust Accounts. The
Indenture Trustee, on behalf of the Noteholders and any Counterparties, shall
possess all right, title and interest in all funds on deposit from time to time
in the Trust Accounts and in all proceeds thereof (including all income thereon)
and all such funds, investments, proceeds and income shall be part of the Trust
Estate. The Trust Accounts shall be under the sole dominion and control of the
Indenture Trustee for the benefit of the Noteholders and any Counterparties. If,
at any time, any of the Trust Accounts ceases to be an Eligible Deposit Account,
the Indenture Trustee agrees, by its acceptance of the trusts herein created,
that it shall within ten (10) Business Days (or such longer period, not to
exceed thirty (30) calendar days, as to which each Rating Agency may consent)
establish a new Trust Account as an Eligible Deposit Account and shall transfer
any cash and/or any investments to such new Trust Account. In connection with
the foregoing, the Issuer agrees that, in the event that any of the Trust
Accounts are not accounts with the Indenture Trustee, the Issuer shall notify
the Indenture Trustee and any Counterparties in writing promptly upon any of
such Trust Accounts ceasing to be an Eligible Deposit Account.

          By the fifteenth Business Day of each month, the Indenture Trustee
shall perform month-end reconciliations of each Trust Account as of the end of
the prior month and provide a copy of such reconciliations to the Issuer.

          With respect to the Trust Account Property, the Indenture Trustee
agrees, by its acceptance of the trusts herein created, that:

          (a)     any Trust Account Property that is held in deposit accounts
shall be held solely in Eligible Deposit Accounts and each such Eligible Deposit
Account shall be subject to

                                       39
                                                              Indenture of Trust

<PAGE>

the exclusive custody and control of the Indenture Trustee, and the Indenture
Trustee shall have sole signature authority with respect thereto;

          (b)     any Trust Account Property that constitutes Physical Property
shall be delivered to the Indenture Trustee in accordance with paragraph (a) of
the definition of "Delivery"; any Trust Account Property that is a book-entry
security held through the Federal Reserve System pursuant to Federal book-entry
regulations shall be delivered in accordance with paragraph (b) of the
definition of "Delivery"; and any Trust Account Property that is an
"uncertificated security" under Article VIII of the UCC and that is not governed
by clause (a) above shall be delivered to the Indenture Trustee in accordance
with paragraph (c) of the definition of "Delivery."

          Section 4.10  Release; Sale or Exchange of Financed Student Loans. The
Indenture Trustee shall, upon Issuer Order and subject to the provisions of this
Indenture and the Rating Agency Condition, take all actions reasonably necessary
to effect the release of any Financed Student Loans from the lien of this
Indenture; provided, however, if no LIBOR Notes remain Outstanding and the
release of Financed Student Loans will not cause the Parity Percentage or the
Senior Parity Percentage to fall below the Required Parity Percentage or the
Required Senior Parity Percentage, respectively, then Financed Student Loans may
be released from the lien of this Indenture without satisfying the Rating Agency
Condition for any of the following purposes:

          (a)     administrative reasons including without limitation the making
of Add-on Consolidation Loans;

          (b)     required sales to Guaranty Agencies for claims payments
related to defaulted Student Loans; and

          (c)     required sales to Subservicers for claims payments on Student
Loans which have lost their Guarantee due to servicing errors.

          Section 4.11  Purchase of Notes. Pursuant to this Indenture, any
amounts held under this Indenture that are available to redeem Notes may instead
be used to purchase Notes outstanding under this Indenture at the same times and
subject to the same conditions (except as to price) as apply to the redemption
of Notes.

                                    Article V

                              Defaults and Remedies

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

          (a)     default in the due and punctual payment of the principal of or
interest on any of the Class A Notes when due;

          (b)     if no Class A Notes are Outstanding hereunder, default in the
due and punctual payment of the principal of or interest on any of the Class B
Notes when due;

                                       40
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

                                       41
                                                              Indenture of Trust

<PAGE>

Notes, in the order of the maturity of the installments of such interest and any
such Scheduled Issuer Derivative Payments and Specified Issuer Termination
Payments, with interest on the overdue installments thereof at the same rates,
respectively, as were borne by the Class B Notes on which such interest shall be
in default and any such Scheduled Issuer Derivative Payments and Specified
Issuer Termination Payments as provided in the ISDA Master Agreement, such
payments to be made ratably to the parties entitled thereto without
discrimination or preference, except as may be provided in a Supplemental
Indenture; third, to the payment of the interest in default on any other
borrowings of the Issuer and to the payment of all Scheduled Issuer Derivative
Payments and Specified Issuer Termination Payments then due under Derivative
Products secured on a parity those other borrowings, in the order of the
maturity of the installments of such interest and any such Scheduled Issuer
Derivative Payments and Specified Issuer Termination Payments, with interest on
the overdue installments thereof at the same rates, respectively, as were borne
by the other borrowings on which such interest shall be in default and any such
Scheduled Issuer Derivative Payments and Specified Issuer Termination Payments
as provided in the ISDA Master Agreement, such payments to be made ratably to
the parties entitled thereto without discrimination or preference, except as may
be provided in a Supplemental Indenture; fourth, to the payment of all Other
Issuer Derivative Payments then due under Derivative Products secured on a
parity with the Class A Notes, such payments to be made ratably to the parties
entitled thereto without discrimination or preference, except as may be provided
in a Supplemental Indenture; fifth, to the payment of all Other Issuer
Derivative Payments then due under Derivative Products secured on a parity with
the Class B Notes, such payments to be made ratably to the parties entitled
thereto without discrimination or preference, except as may be provided in a
Supplemental Indenture; and sixth, to the payment of all Other Issuer Derivative
Payments then due under Derivative Products secured on a parity with any other
borrowings of the Issuer, such payments to be made ratably to the parties
entitled thereto without discrimination or preference, except as may be provided
in a Supplemental Indenture; and

          (b)     if the principal of any of the Obligations shall have become
due by declaration of acceleration or otherwise, first, to the payment of the
interest in default on the Class A Notes and to the payment of all Scheduled
Issuer Derivative Payments and Specified Issuer Termination Payments then due
under Derivative Products secured on a parity with the Class A Notes, in the
order of the maturity of the installments of such interest and any such
Scheduled Issuer Derivative Payments and Specified Issuer Termination Payments,
with interest on the overdue installments thereof at the same rates,
respectively, as were borne by the Class A Notes on which such interest shall be
in default and any such Scheduled Issuer Derivative Payments and Specified
Issuer Termination Payments as provided in the ISDA Master Agreement, such
payments to be made ratably to the parties entitled thereto without
discrimination or preference, except as may be provided in a Supplemental
Indenture; second, to the payment of the principal of all Class A Notes then due
and Specified Issuer Termination Payments then due under Derivative Products
secured on a parity with the Class A Notes, such payments to be made ratably to
the parties entitled thereto without discrimination or preference; third, to the
payment of the interest in default on the Class B Notes and to the payment of
all Scheduled Issuer Derivative Payments and Specified Issuer Termination
Payments then due under Derivative Products secured on a parity with the Class B
Notes, in the order of the maturity of the installments of such interest and any
such Scheduled Issuer Derivative Payments and Specified Issuer Termination
Payments, with interest on the overdue installments thereof at

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                                                              Indenture of Trust

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the same rates, respectively, as were borne by the Class B Notes on which such
interest shall be in default and any such Scheduled Issuer Derivative Payments
and Specified Issuer Termination Payments as provided in the ISDA Master
Agreement, such payments to be made ratably to the parties entitled thereto
without discrimination or preference, except as may be provided in a
Supplemental Indenture; fourth, to the payment of the principal of all Class B
Notes then due and Specified Issuer Termination Payments then due under
Derivative Products secured on a parity with the Class B Notes, such payments to
be made ratably to the parties entitled thereto without discrimination or
preference; fifth, to the payment of the interest in default on any other
borrowings of the Issuer and to the payment of all Scheduled Issuer Derivative
Payments and Specified Issuer Termination Payments then due under Derivative
Products secured on a parity those other borrowings, in the order of the
maturity of the installments of such interest and any such Scheduled Issuer
Derivative Payments and Specified Issuer Termination Payments, with interest on
the overdue installments thereof at the same rates, respectively, as were borne
by the other borrowings on which such interest shall be in default and any such
Scheduled Issuer Derivative Payments and Specified Issuer Termination Payments
as provided in the ISDA Master Agreement, such payments to be made ratably to
the parties entitled thereto without discrimination or preference, except as may
be provided in a Supplemental Indenture; sixth, to the payment of the principal
of all other borrowings of the Issuer, if any, then due and Specified Issuer
Termination Payments then due under Derivative Products secured on a parity
those other borrowings, such payments to be made ratably to the parties entitled
thereto without discrimination or preference, except as may be provided in a
Supplemental Indenture; seventh, to the payment of interest accrued on the
Carry-over Amounts of the Class A Auction Rate Notes, to the payment of
Carry-over Amounts of the Class A Auction Rate Notes, to the payment of interest
accrued on the Carry-over Amounts of the Class B Auction Rate Notes, and to the
payment of the Carry-over Amounts of the Class B Auction Rate Notes, in that
order of priority; eighth, to the payment of all Other Issuer Derivative
Payments then due under Derivative Products secured on a parity with the Class A
Notes, such payments to be made ratably to the parties entitled thereto without
discrimination or preference, except as may be provided in a Supplemental
Indenture; ninth, to the payment of all Other Issuer Derivative Payments then
due under Derivative Products secured on a parity with the Class B Notes, such
payments to be made ratably to the parties entitled thereto without
discrimination or preference, except as may be provided in a Supplemental
Indenture; and tenth, to the payment of all Other Issuer Derivative Payments
then due under Derivative Products secured on a parity with any other borrowings
of the Issuer, such payments to be made ratably to the parties entitled thereto
without discrimination or preference, except as may be provided in a
Supplemental Indenture.

          Section 5.03  Remedies on Default; Advice of Counsel. Upon the
happening of any Event of Default, the Indenture Trustee may proceed to protect
and enforce the rights of the Indenture Trustee and the Noteholders in such
manner as counsel for the Indenture Trustee may advise, whether for the specific
performance of any covenant, condition, agreement or undertaking herein
contained, or in aid of the execution of any power herein granted, or for the
enforcement of such other appropriate legal or equitable remedies as, in the
opinion of such counsel, may be more effectual to protect and enforce the rights
aforesaid. The Indenture Trustee shall give notice of any action it is taking
pursuant to Article V with respect to an Event of Default to each Rating Agency.

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          Section 5.04  Remedies on Default; Sale of Trust Estate. Upon the
happening of any Event of Default and if the principal of all of the Outstanding
Obligations shall have been declared due and payable, then and in every such
case, and irrespective of whether other remedies authorized shall have been
pursued in whole or in part, the Indenture Trustee may sell, with or without
entry, to the highest bidder the Trust Estate, and all right, title, interest,
claim and demand thereto and the right of redemption thereof, at any such place
or places, and at such time or times and upon such notice and terms as may be
required by law. Upon such sale the Indenture Trustee may make and deliver to
the purchaser or purchasers a good and sufficient assignment or conveyance for
the same, which sale shall be a perpetual bar both at law and in equity against
the Issuer and all Persons claiming such properties. No purchaser at any sale
shall be bound to see to the application of the purchase money or to inquire as
to the authorization, necessity, expediency or regularity of any such sale. The
Indenture Trustee is hereby irrevocably appointed the true and lawful
attorney-in-fact of the Issuer, in its name and stead, to make and execute all
bills of sale, instruments of assignment and transfer and such other documents
of transfer as may be necessary or advisable in connection with a sale of all or
part of the Trust Estate, but the Issuer, if so requested by the Indenture
Trustee, shall ratify and confirm any sale or sales by executing and delivering
to the Indenture Trustee or to such purchaser or purchasers all such instruments
as may be necessary, or in the judgment of the Indenture Trustee, proper for the
purpose that may be designated in such request. In addition, the Indenture
Trustee may proceed to protect and enforce the rights of the Indenture Trustee
and the holders of the Obligations in such manner as counsel for the Indenture
Trustee may advise, whether for the specific performance of any covenant,
condition, agreement or undertaking herein contained, or in aid of the execution
of any power herein granted, or for the enforcement of such other appropriate
legal or equitable remedies as may in the opinion of such counsel, be more
effectual to protect and enforce the rights aforesaid. The Indenture Trustee
shall take any such action or actions if requested to do so in writing by the
Noteholders of at least a majority of the principal amount of the Highest
Priority Obligations at the time Outstanding.

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

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

          Section 5.07  Purchase of Properties by Indenture Trustee or
Noteholders. In case of any such sale of the Trust Estate, any Noteholder or
Noteholders or committee of Noteholders

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

          Section 5.11  Direction of Indenture Trustee. Upon the happening of
any Event of Default, the Noteholders of at least a majority of the principal
amount of the Highest Priority Obligations then Outstanding, shall have the
right by an instrument or instruments in writing delivered to the Indenture
Trustee to direct and control the Indenture Trustee as to the method of taking
any and all proceedings for any sale of any or all of the Trust Estate, or for
the appointment of a receiver, if permitted by law, and may at any time cause
any proceedings authorized by the terms hereof to be so taken or to be
discontinued or delayed; provided, however, that such Noteholders shall not be
entitled to cause the Indenture Trustee to take any proceedings that in the
Indenture Trustee's opinion would be unjustly prejudicial to non-assenting
holders of Obligations, but the Indenture Trustee shall be entitled to assume
that the action requested by the Noteholders of at least a majority of the
principal amount of the Highest Priority Obligations then Outstanding will not
be prejudicial to any non-assenting Noteholders

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                                                              Indenture of Trust

<PAGE>

unless the Noteholders of at least a majority of the principal amount of
Obligations of the non-assenting Noteholders, in writing, show the Indenture
Trustee how they will be prejudiced. Anything in this Indenture to the contrary
notwithstanding, the Noteholders of at least a majority of the principal amount
of the Highest Priority Obligations then Outstanding together with the
Noteholders of at least a majority of the principal amount of all other
Obligations then Outstanding shall have the right, at any time, by an instrument
or instruments in writing executed and delivered to the Indenture Trustee, to
direct the method and place of conducting all proceedings to be taken in
connection with the enforcement of the terms and conditions of this Indenture,
or for the appointment of a receiver or any other proceedings hereunder,
provided that such direction shall not be otherwise than in accordance with the
provisions of law and of this Indenture. The provisions of this Section 5.11
shall be expressly subject to the provisions of Sections 6.01(c) and 6.05.

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

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

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

          Section 5.14  Waivers of Events of Default. The Indenture Trustee may
in its discretion waive any Event of Default hereunder and its consequences and
rescind any declaration of acceleration of Obligations, and shall do so upon the
written request of the

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                                                              Indenture of Trust

<PAGE>

Noteholders of at least a majority of the principal amount of the Highest
Priority Obligations then Outstanding; provided, however, that there shall not
be waived (a) any Event of Default in the payment of the principal of or premium
on any Outstanding Obligations at the date of maturity or redemption thereof, or
any default in the payment when due of the interest on any such Obligations,
unless prior to such waiver or rescission, all arrears of interest or all
arrears of payments of principal and premium, if any, and all expenses of the
Indenture Trustee, in connection with such default shall have been paid or
provided for or (b) any default in the payment of amounts set forth in Section
6.05. In case of any such waiver or rescission, or in case any proceedings taken
by the Indenture Trustee on account of any such default shall have been
discontinued or abandoned or determined adversely to the Indenture Trustee, then
and in every such case the Issuer, the Indenture Trustee and the holders of
Obligations shall be restored to their former positions and rights hereunder
respectively, but no such waiver or rescission shall extend to or affect any
subsequent or other default, or impair any rights or remedies consequent
thereon.

                                   Article VI

                              The Indenture Trustee

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

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

(excluding, however, any action taken by the Indenture Trustee acting as Master
Servicer pursuant to Section 6.15).

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

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

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

          Section 6.05  Indemnification of Indenture Trustee. Other than with
respect to its duties to make payment on the Obligations when due, and its duty
to pursue the remedy of acceleration as provided in Section 5.02, for each of
which no additional security or indemnity may be required, the Indenture Trustee
shall be under no obligation or duty to perform any act at the request of
Noteholders or to institute or defend any suit in respect thereof unless
properly indemnified and provided with security to its satisfaction as provided
in Section 6.01(c). The Indenture Trustee shall not be required to take notice,
or be deemed to have knowledge, of any default or Event of Default of the Issuer
hereunder and may conclusively assume that there has been no such default or
Event of Default (other than an Event of Default described in Sections 5.01(a)
or (b)) unless and until a Responsible Officer shall have been specifically
notified in writing at the address in Section 8.01 of such default or Event of
Default by (a) the Noteholders of the required percentages in principal amount
of the Obligations then Outstanding hereinabove specified or (b) an Authorized
Officer of the Issuer. However, the Indenture Trustee may begin suit, or appear
in and defend suit, execute any of the trusts hereby created, enforce

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<PAGE>

any of its rights or powers hereunder, or do anything else in its judgment
proper to be done by it as Indenture Trustee, without assurance of reimbursement
or indemnity, and in such case the Indenture Trustee shall be reimbursed or
indemnified by the Noteholders requesting such action, if any, or the Issuer in
all other cases, for all fees, costs and expenses, liabilities, outlays and
counsel fees and other reasonable disbursements properly incurred in connection
therewith, unless such costs and expenses, liabilities, outlays and attorneys'
fees and other reasonable disbursements properly incurred in connection
therewith are adjudicated to have resulted from the negligence or willful
misconduct of the Indenture Trustee. In furtherance and not in limitation of
this Section 6.05, the Indenture Trustee shall not be liable for, and shall be
held harmless by the Issuer from, following any orders, instructions or other
directions upon which the Indenture Trustee is authorized to rely pursuant to
this Indenture or any other agreement to which it is a party. If the Issuer or
the Noteholders, as appropriate, shall fail to make such reimbursement or
indemnification, the Indenture Trustee may reimburse itself from any money in
its possession under the provisions of this Indenture, subject only to the prior
lien of the Notes for the payment of the principal thereof, premium, if any, and
interest thereon from the Collection Account. None of the provisions contained
in this Indenture or any other agreement to which it is a party shall require
the Indenture Trustee to act or to expend or risk its own funds or otherwise
incur individual financial liability in the performance of any of its duties or
in the exercise of any of its rights or powers (excluding, however, any duties,
rights or powers of the Indenture Trustee acting as Master Servicer pursuant to
Section 6.15) if the Noteholders shall not have offered security and indemnity
acceptable to it or if it shall have reasonable grounds for believing that
prompt repayment of such funds or adequate indemnity against such risk or
liability is not reasonably assured to it.

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

          Section 6.06  Indenture Trustee's Right to Reliance. The Indenture
Trustee shall fully be protected in acting upon any notice, resolution, request,
consent, order, certificate, report, appraisal, opinion, report or document of
the Issuer, the Administrator or the Master Servicer or other paper or document
believed by it to be genuine and to have been signed or presented by the proper
party or parties. The Indenture Trustee may consult with experts and with
counsel (who may, but need not, be counsel for the Issuer, the Indenture
Trustee, or for a Noteholder), and the

                                       49
                                                              Indenture of Trust

<PAGE>

opinion of such counsel shall be full and complete authorization and protection
in respect of any action taken or suffered, and in respect of any determination
made by it hereunder in good faith and in accordance with the opinion of such
counsel.

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

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

          The Indenture Trustee is authorized, under this Indenture, subject to
Section 4.10, to sell, assign, transfer or convey Financed Student Loans in
accordance with an Issuer Order. If such Financed Student Loan was originated
under the Act, such Issuer Order shall certify that the Person to whom such
Financed Student Loan is sold, assigned, transferred, or conveyed is an Eligible
Lender unless not required by the Act. The Indenture Trustee is further
authorized to enter into agreements with other Persons, in its capacity as
Indenture Trustee, in order to carry out or implement the terms and provisions
of this Indenture.

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

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

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

          Section 6.07  Compensation of Indenture Trustee. Except as otherwise
expressly provided herein, all advances, counsel fees and other expenses
reasonably made or incurred by the Indenture Trustee in and about the execution
and administration of the trust hereby created and reasonable compensation to
the Indenture Trustee for its services in the premises shall be paid by the
Issuer. The compensation of the Indenture Trustee shall not be limited to or by
any provision of law in regard to the compensation of trustees of an express
trust. If not paid by the Issuer, the Indenture Trustee shall have a lien
against all money held pursuant to this Indenture,

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<PAGE>

subject only to the prior lien of the Obligations against the money and
investments in the Collection Account for the payment of the principal thereof,
premium, if any, and interest thereon, for such reasonable compensation,
expenses, advances and counsel fees incurred in and about the execution of the
trusts hereby created and the exercise and performance of the powers and duties
of the Indenture Trustee hereunder and the cost and expense incurred in
defending against any liability in the premises of any character whatsoever
(unless such liability is adjudicated to have resulted from the negligence or
willful misconduct of the Indenture Trustee).

          Section 6.08  Indenture Trustee May Own Notes. The Indenture Trustee
hereunder, or any successor Indenture Trustee, in its individual or other
capacity, may become the owner or pledgee of Notes and may otherwise deal with
the Issuer, with the same rights it would have if it were not the Indenture
Trustee. The Indenture Trustee may act as depository for, and permit any of its
officers or directors to act as a member of, or act in any other capacity in
respect to, any committee formed to protect the rights of the Noteholders or to
effect or aid in any reorganization growing out of the enforcement of the Notes
or of this Indenture, whether or not any such committee shall represent the
Noteholders of more than 66% of the principal amount of the Outstanding
Obligations.

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

          Section 6.10  Removal of Indenture Trustee. The Indenture Trustee or
any successor Indenture Trustee may be removed (a) at any time by the
Noteholders of a majority of the principal amount of the Highest Priority
Obligations then Outstanding, (b) by the Issuer for cause or upon the sale or
other disposition of the Indenture Trustee or its corporate trust functions or
(c) by the Issuer without cause so long as no Event of Default as described in
Sections 5.01(a), (b) or (c) exists or has existed within the last 30 days, upon
payment to the Indenture Trustee so removed of all money then due to it
hereunder and appointment by the Issuer of a successor having the qualifications
set forth in Section 6.11 and acceptance thereof by said successor. One copy of
any such order of removal shall be filed with the Issuer and the other with the
Indenture Trustee so removed.

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

          Section 6.11  Successor Indenture Trustee. In case at any time the
Indenture Trustee or any successor Indenture Trustee shall resign, be dissolved,
or otherwise shall be disqualified to act or be incapable of acting, or in case
control of the Indenture Trustee or of any successor Indenture Trustee or of its
officers shall be taken over by any public officer or officers, a successor
Indenture Trustee may be appointed by the Issuer. In the case of any such
appointment by the Issuer of a successor Indenture Trustee, the Issuer shall
forthwith cause notice thereof to be mailed to the Noteholders at the address of
each Noteholder appearing on the note registration books maintained by the
Indenture Trustee. Every successor Indenture Trustee appointed by the
Noteholders, by a court of competent jurisdiction, or by the Issuer shall be a
bank or trust company in good standing, organized and doing business under the
laws of the United States or of a state therein, that has a reported capital and
surplus of not less than $50,000,000, be authorized under the law to exercise
corporate trust powers, be subject to supervision or examination by a federal or
state authority, and be an Eligible Lender so long as such designation is
necessary to maintain guarantees and federal benefits under the Act with respect
to Financed Student Loans that were originated under the Act.

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

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                                                              Indenture of Trust

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

          Section 6.13  Additional Covenants by the Indenture Trustee to Conform
to the Act. The Indenture Trustee covenants that it will at all times be an
Eligible Lender under the Act so long as such designation is necessary, as
determined by the Issuer, to maintain the guarantees and federal benefits under
the Act with respect to Financed Student Loans that were originated under the
Act, that it will acquire Student Loans originated under the Act in its capacity
as an Eligible Lender, and that it will not dispose of or deliver any Student
Loans originated under the Act or any security interest in any such Student
Loans to any party who is not an Eligible Lender so long as the Act or
Regulations adopted thereunder require an Eligible Lender to be the owner or
holder of such Student Loans; provided, however, that nothing above shall
prevent the Indenture Trustee from delivering Student Loans originated under the
Act to the Master Servicer or the Guaranty Agency.

          Section 6.14  Limitation with Respect to Examination of Reports.
Except as provided in this Indenture, the Indenture Trustee shall be under no
duty to examine, inspect or review any report or statement or other document
required or permitted to be filed with it by the Issuer. Pursuant to Sections 4
and 7 of the Master Servicing Agreement and Sections 2, 6, 16 and 17 of the
Administration Agreement, the Indenture Trustee shall receive from the Master
Servicer or Administrator certain reports, statements and other documents.
Notwithstanding the receipt thereof by the Indenture Trustee, the Indenture
Trustee, unless it has become the Master Servicer or the Administrator, shall
have no duty to inspect, examine or review any such information for any purpose
regardless of the format in which it is received by the Indenture Trustee.

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

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

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

          (b)  so long as any of the Financed Student Loans were originated
under the Act, it will comply with the Act and the Regulations and will, upon
written notice from an

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<PAGE>

Authorized Officer of the Issuer, the Secretary, or the Guaranty Agency, use its
reasonable efforts to cause this Indenture to be amended (in accordance with
Section 7.01) if the Act or Regulations are hereafter amended so as to be
contrary to the terms of this Indenture;

          (c)  it will verify that the LIBOR rates applicable to the LIBOR
Notes, as determined by the Calculation Agent, are correct; and

          (d)  it will not consent to the release by any Subservicer of
promissory notes representing Financed Student Loans unless either (i) such
Financed Student Loans have been paid in full, (ii) such Financed Student Loans
have been purchased at a purchase price equal to not less than the principal
balance thereof plus unamortized premium, if any, and interest accrued thereon,
or (iii) a successor Subservicer has replaced such Subservicer requiring a
transfer of those promissory notes to the successor Subservicer.

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

          Fitch Ratings
          One State Street Plaza
          32/nd/ Floor
          New York, New York 10004
          Attention:  ABS Surveillance

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

          Standard & Poor's
          55 Water Street
          40/th/ Floor
          New York, New York 10041
          Attention:  Asset-Backed Surveillance

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

          Section 6.18  Merger of the Indenture Trustee. Any corporation into
which the Indenture Trustee may be merged or with which it may be consolidated,
or any corporation

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<PAGE>

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

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

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

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

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

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          Section 6.23  Payment of Taxes and Other Governmental Charges.

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

disbursements and advances of the Indenture Trustee and any predecessor
Indenture Trustee, their agents and counsel, and any other amounts due the
Indenture Trustee or any predecessor Indenture Trustee.

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

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

          Section 6.25  Preferential Collection of Claims Against Issuer. The
Indenture Trustee shall comply with Section 311(a) of the Trust Indenture Act,
excluding any creditor relationship listed in Section 311(b) of the Trust
Indenture Act. An Indenture Trustee who has resigned or been removed shall be
subject to Section 311(a) of the Trust Indenture Act to the extent indicated.

                                   Article VII

                             Supplemental Indentures

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

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

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

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

          (d)  to modify, amend or supplement this Indenture or any Supplemental
Indenture in such manner as to permit the qualification hereof and thereof under
the Trust Indenture Act or any similar federal statute hereafter in effect or to
permit the qualification of the Notes for sale under the securities laws of the
United States of America or of any of the states of the United States of
America, and, if they so determine, to add to this Indenture or any Supplemental
Indenture such other terms, conditions and provisions as may be permitted by
said Trust Indenture Act or similar federal statute;

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<PAGE>

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

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

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

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

          (i)  to provide for the issuance of subordinate indebtedness of the
Issuer, including the creation of appropriate Accounts and Subaccounts with
respect to such indebtedness, secured by a lien on the Trust Estate subordinate
to the lien thereon securing the Senior Obligations and the Subordinate
Obligations, provided such subordinate indebtedness meets the requirements of
Section 2.02 and provided that the Issuer has received a Rating Confirmation
with respect to the issuance of such subordinated indebtedness;

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

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

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

          (m)  to amend the Indenture to provide for use of a surety bond or
other financial guaranty instrument in lieu of cash and/or Eligible Investments
in all or any portion of the Reserve Account, (a) so long as such action shall
not adversely affect the Ratings on any of the Notes, and (b) while any LIBOR
Notes are Outstanding, so long as such action shall not result in any Rating
Agency which rated the Notes on the Closing Date reducing any of its Ratings of
the Outstanding Notes below any of that Rating Agency's Ratings of the Notes on
the Closing Date or withdrawing any of its Ratings;

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

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<PAGE>

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

          provided, however, that nothing in this Section 7.01 shall permit, or
be construed as permitting, (a) without the consent of the Noteholders of each
affected Note and each Derivative Product then Outstanding, (i) an extension of
the maturity date of the principal of or the interest on any Obligation, or (ii)
a reduction in the principal amount of any Obligation or the rate of interest
thereon, or (iii) a privilege or priority of any Obligation or Obligations over
any other Obligation or Obligations except as otherwise provided herein, or (iv)
a reduction in the aggregate principal amount of the Obligations required for
consent to a Supplemental Indenture, or (v) the creation of any lien other than
a lien ratably securing all of the Obligations at any time Outstanding hereunder
except as otherwise provided herein or (b) any modification of the trusts,
powers, rights, duties, remedies, immunities and privileges of the Indenture
Trustee without the prior written approval of the Indenture Trustee, which
approval shall be evidenced by execution of a Supplemental Indenture.

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

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

          If at any time the Issuer shall request that the Indenture Trustee
enter into any such Supplemental Indenture for any of the purposes in this
Section 7.02, the Indenture Trustee shall be entitled to receive an Opinion of
Counsel from the Issuer that all conditions precedent to the execution of any
Supplemental Indenture have been met. The Indenture Trustee shall, upon being
satisfactorily indemnified with respect to expenses, cause notice of the
proposed execution of such Supplemental Indenture to be mailed by registered or
certified mail to each Noteholder

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                                                              Indenture of Trust

<PAGE>

of an Obligation at the address shown on the registration books or listed in any
Derivative Product. Such notice (which shall be prepared by the Issuer) shall
briefly set forth the nature of the proposed Supplemental Indenture and shall
state that copies thereof are on file at the principal corporate trust office of
the Indenture Trustee for inspection by all Noteholders. If, within 60 days, or
such longer period as shall be prescribed by the Issuer, following the mailing
of such notice, the Noteholders of not less than a majority of the principal
amount of each class of affected Notes and each affected Derivative Product then
Outstanding at the time of the execution of any such Supplemental Indenture
shall have consented in writing to and approved the execution thereof as herein
provided, no Noteholder of any Obligation shall have any right to object to any
of the terms and provisions contained therein, or the operation thereof, or in
any manner to question the propriety of the execution thereof, or to enjoin or
restrain the Indenture Trustee or the Issuer from executing the same or from
taking any action pursuant to the provisions thereof.

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

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

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

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

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

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                                  Article VIII

                               General Provisions

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

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

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

          If intended for the Issuer:

               Education Funding Capital Trust-III
               c/o Fifth Third Bank
               MD 10AT60
               38 Fountain Square Plaza
               Cincinnati, Ohio 45263
               Attention: Corporate Trust Administration
               Telephone: +1.513.534.0724
               Facsimile: +1.513.534.3115

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               with a copy to:

               Wilmington Trust Company
               Rodney Square North
               1100 North Market Street
               Wilmington, Delaware 19890-0001
               Attention: Corporate Trust Administration
               Telephone: +1.302.636.6189
               Facsimile: +1.302.636.4144

          If intended for the Indenture Trustee:

               Fifth Third Bank
               MD 10AT60
               38 Fountain Square Plaza
               Cincinnati, Ohio 45263
               Attention: Corporate Trust Administration
               Telephone: +1.513.534.0724
               Facsimile: +1.513.534.3115

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

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

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

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

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

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

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

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

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

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

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

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

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and on behalf of the Issuer are for the sole and exclusive benefit of the
Indenture Trustee, the paying agent, if any, and the holders of the Obligations.

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

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

          Section 8.14  Disclosure of Names and Addresses of Noteholders.
Noteholders by receiving and holding the same, agree with the Issuer and the
Indenture Trustee that neither the Issuer nor the Indenture Trustee nor any
Securities Depository shall be held accountable by reason of the disclosure of
any information as to the names and addresses of the Noteholders in accordance
with TIA Section 312, regardless of the source from which such information was
derived, and that the Indenture Trustee shall not be held accountable by reason
of mailing any material pursuant to a request made under TIA Section 312(b).

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

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

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

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          Section 8.18  Undertaking for Costs. The Issuer and the Indenture
Trustee agree, and each Noteholder by acceptance of an Note shall be deemed to
have agreed, that any court may, in its discretion, require, in any suit for the
enforcement of any right or remedy under this Indenture, or in any suit against
the Indenture Trustee for any action taken or omitted by it as Indenture
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may, in its discretion, assess
reasonable costs, including reasonable attorneys' fees, against any party
litigant in such suit, having due regard to the merits and good faith of the
claims or defenses made by such party litigant; but the provisions of this
Section 8.18 shall not apply to (i) any suit instituted by the Indenture
Trustee, (ii) any suit instituted by any Noteholder, or group thereof, in each
case holding in the aggregate more than ten percent (10%) of the Outstanding
principal amount of the Notes or (iii) any suit instituted by any Noteholder for
the enforcement of the payment of the principal of, premium, if any, or interest
on any Note in accordance with Section 5.12.

                                   Article IX

                        Payment and Cancellation of Notes
                          and Satisfaction of Indenture

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

          Section 9.02  Satisfaction of Indenture.

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

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

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

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

                                    Article X

                                   Termination

          Section 10.01 Termination of the Trust.

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

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

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

          Section 10.03 Auction of Financed Student Loans. The Indenture Trustee
shall offer for sale by auction all remaining Financed Student Loans at the end
of the Collection Period when the Pool Balance is 10% or less of the initial
Pool Balance. The auction date will be the 3rd Business Day before the related
Distribution Date. An auction will occur only if the Master Servicer has first
waived its optional purchase right. The Master Servicer will waive its option to
purchase the remaining Financed Student Loans if it fails to notify the Trust
Eligible Lender Trustee and the Indenture Trustee, in writing, that it intends
to exercise its purchase option before the Indenture Trustee accepts a bid to
purchase the Financed Student Loans. The Depositor and its affiliates, including
Education Lending Group, Inc. and the Master Servicer, and unrelated third
parties may offer bids to purchase the Financed Student Loans. The Depositor or
any affiliate may not submit a bid representing greater than fair market value
of the Financed Student Loans.

          If at least two bids are received, the Indenture Trustee shall solicit
and re-solicit new bids from all participating bidders until only one bid
remains or the remaining bidders

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<PAGE>

decline to resubmit bids. The Indenture Trustee shall accept the highest of the
remaining bids if it equals or exceeds (a) the Minimum Purchase Amount or (b)
the fair market value of the Financed Student Loans as of the end of the related
Collection Period, whichever is higher. If at least two bids are not received or
the highest bid after the re-solicitation process does not equal or exceed that
amount, the Indenture Trustee shall not complete the sale. The Indenture Trustee
may, and at the direction of the Depositor shall be required to, consult with a
financial advisor, including one of the Underwriters or the Administrator, to
determine if the fair market value of the Financed Student Loans has been
offered.

          The net proceeds of any auction sale will be used to retire any
Outstanding Notes on the related Distribution Date.

          If the sale is not completed, the Indenture Trustee may, but will not
be under any obligation to, solicit bids for sale of the Financed Student Loans
after future Collection Periods upon terms similar to those described above,
including the Master Servicer's waiver of its option to purchase remaining
Financed Student Loans.

          If the Financed Student Loans are not sold as described above, on each
subsequent Distribution Date, if the amount on deposit in the Reserve Account
after giving effect to all withdrawals, except withdrawals payable to the
Co-Owner Trustee for deposit into the Certificate Distribution Account, exceeds
the Reserve Account Requirement, the Indenture Trustee shall distribute the
amount of the excess as accelerated payments of principal of the Notes. The
Indenture Trustee may or may not succeed in soliciting acceptable bids for the
Financed Student Loans either on the auction date or subsequently.

                                   Article XI

                             Reporting Requirements

          Section 11.01 Annual Statement as to Compliance. The Master Servicer
will deliver to each Rating Agency, the Indenture Trustee and the Issuer, on or
before March 31 of each year, beginning with March 31, 2004, a certificate
stating that (a) a review of the activities of the Master Servicer during the
preceding calendar year and of its performance under the Master Servicing
Agreement has been made under the supervision of the officer signing such
certificate and (b) to the best of such officers' knowledge, based on such
review, the Master Servicer has fulfilled all its obligations under the Master
Servicing Agreement throughout such year, or, there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof.

          Section 11.02 Annual Independent Public Accountant's Servicing Report.
On or before March 31 of each year, beginning March 31, 2004, the Master
Servicer at its expense shall cause an independent public accountant that is a
member of the American Institute of Certified Public Accountants to furnish a
statement to each Rating Agency, the Issuer and the Indenture Trustee to the
effect that such accountant has examined certain documents and records relating
to the servicing of the Financed Student Loans (during the preceding fiscal
year) under servicing agreements substantially similar one to another and to the
Master Servicing Agreement and that, on the basis of such examination, such
servicing has been conducted in compliance

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with such servicing agreements except for such significant exceptions or errors
in records that, in the opinion of such accountant, requires it to report and
that are set forth in such report.

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

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

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

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

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

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

          (e)  the Pool Balance as of the close of business on the last day of
the preceding month;

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

          (g)  the Pool Factor for each Series of Notes as of the close of
business on the last day of the preceding month;

          (h)  the Senior Parity Percentage as of the close of business on the
last day of the preceding month;

          (i)  the Parity Percentage as of the close of business on the last day
of the preceding month;

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

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

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

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

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

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

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

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

          (r)  the balance of the Collection Account as of the close of business
on the last day of the preceding month;

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

          (t)  the amount remaining in the Acquisition Account that has not been
used to acquire Student Loans and is being transferred to the Collection
Account;

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

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

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

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

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

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

          Each amount set forth pursuant to paragraph (a), (b), (k) and (l)
above shall be expressed as a dollar amount per Authorized Denomination of a
Note. If an Event of Default shall have occurred, the statements referred to
above shall contain a description of the Event of Default. A copy of the
statements referred to above may be obtained by any Noteholder by a written
request to the Indenture Trustee, addressed to its Corporate Trust Office.

          Within 60 days after each April 15 of each year commencing with the
April 15 following the first issuance of Notes under this Indenture, if required
by Section 313(a) of the Trust Indenture Act, the Indenture Trustee shall
transmit, pursuant to Section 313(c) of the Trust Indenture Act, a brief report
dated as of such April 15 with respect to any of the events specified in such
Section 313(a) which may have occurred since the later of the immediately
preceding April 15 or the date of this Indenture. The Indenture Trustee shall
transmit the reports required by Section 313(a) of the Trust Indenture Act at
the time specified therein. Reports pursuant to this Section 11.04 shall be
transmitted in the manner and to the Persons required by Sections 313(c) and
313(d) of the Trust Indenture Act.

          Section 11.05 Compliance Certificates and Opinions.

          (a)  Except as otherwise specifically provided in this Indenture or in
any Supplemental Indenture, upon any application or request by the Issuer to the
Indenture Trustee to take any action under any provision of this Indenture,
including, without limitation, any action relating to authentication and
delivery of any Notes, the release or the release and substitution of property
subject to the lien and security interest of this Indenture or in any
Supplemental Indenture or the satisfaction and discharge of this Indenture or in
any Supplemental Indenture, the Issuer shall furnish (i) a certificate stating
that all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with, (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with and (iii) if required by the Trust Indenture Act, a
certificate from a firm of independent certified public accountants meeting the
applicable requirements of this Section 11.05, except that, in the case of any
such application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture or of any Supplemental
Indenture, no additional certificate or opinion need be furnished. Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include: (i) a statement that each
signatory of such certificate or opinion has read or has caused to be read such
covenant or condition and the definitions herein relating thereto; (ii) a brief
statement as to the nature and scope of the examination or investigation upon
which the

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statements or opinions contained in such certificate or opinion are based; (iii)
a statement that, in the opinion of each such signatory, such signatory has made
such examination or investigation as is necessary to enable such signatory to
express an informed opinion as to whether or not such covenant or condition has
been complied with; and (iv) a statement as to whether, in the opinion of each
such signatory, such condition or covenant has been complied with.

          (b)  Prior to the deposit of any property or securities with the
Indenture Trustee that is to be made the basis for the release of any property
subject to the lien created by this Indenture, the Issuer shall, in addition to
any obligation imposed in Section 11.05(a) or elsewhere in this Indenture or in
any Supplemental Indenture, furnish to the Indenture Trustee (i) a certificate
certifying or stating the opinion of each Person signing such certificate as to
the fair value (within 90 days of such deposit) to the Issuer of the property or
securities to be so deposited, (ii) an Opinion of Counsel either stating that,
in the opinion of such counsel, such action has been taken with respect to the
recording and filing of this Indenture and any other requisite documents, and
with respect to the filing of any financing statements and continuation
statements, as are necessary to perfect and make effective the lien and security
interest in favor of the Indenture Trustee, for the benefit of the Indenture
Trustee, created by this Indenture or by any Supplemental Indenture in the
property or securities to be so deposited, and reciting the details of such
action, or stating that, in the opinion of such counsel, no such action is
necessary to make such lien and security interest effective, and (iii) (a)
evidence that each of the Rating Agencies then rating any Outstanding Notes have
confirmed that such action will not result in a reduction, qualification or
withdrawal of the then-current rating of any of the Notes, (b) and while any
LIBOR Notes are Outstanding, evidence from each Rating Agency which rated the
Notes on the Closing Date that such action will not result in the Ratings of the
Outstanding Notes being reduced below that Rating Agency's Rating of the Notes
on the Closing Date or withdrawn.

          (c)  Whenever the Issuer is required to furnish to the Indenture
Trustee a certificate certifying or stating the opinion of any signer thereof as
to the matters described in paragraph (b) above, the Issuer shall also furnish
to the Indenture Trustee a certificate from a firm of independent certified
public accountants as to the same matters, if the fair value to the Issuer of
the property to be so deposited and of all other such property made the basis of
any such withdrawal or release since the commencement of the then-current fiscal
year of the Issuer, as set forth in the certificates delivered pursuant to
paragraph (b) above and this paragraph (c), is ten percent (10%) or more of the
Outstanding principal amount of the Notes, but such a certificate need not be
furnished with respect to any property so deposited, if the fair value thereof
set forth in the related certificate is less than $25,000 or less than one
percent (1%) of the Outstanding Amount of the Notes.

          (d)  Other than with respect to any release described in clause (i) or
(ii) of paragraph (f) below, whenever any property or securities are to be
released from the lien created by this Indenture, the Issuer shall also furnish
to the Indenture Trustee a certificate certifying or stating the opinion of each
Person signing such certificate as to the fair value (within 90 days of such
release) of the property or securities proposed to be released and stating that
in the opinion of such Person the proposed release will not impair the security
created by this Indenture in contravention of the provisions hereof.

                                       71
                                                              Indenture of Trust

<PAGE>

          (e)  Whenever the Issuer is required to furnish to the Indenture
Trustee a certificate certifying or stating the opinion of any signer thereof as
to the matters described in paragraph (d) above, the Issuer shall also furnish
to the Indenture Trustee a certificate from a firm of independent certified
public accountants as to the same matters, if the fair value to the Issuer of
the property or securities or of all other property or securities (other than
property described in clauses (i) and (ii) of paragraph (f) below) released from
the lien created by this Indenture since the commencement of the then-current
fiscal year of the Issuer, as set forth in the certificates delivered pursuant
to paragraph (d) above and this paragraph (e), equals ten percent (10%) or more
of the Outstanding Amount of the Notes, but such a certificate need not be
furnished with respect to any release of property or securities, if the fair
value thereof set forth in the related certificate is less than $25,000 or less
than one percent (1%) of the Outstanding Amount of the Notes.

          (f)  Notwithstanding any other provision of this Section 11.05, the
Issuer may, without compliance with the other provisions of this Section 11.05,
(i) collect, liquidate, sell or otherwise dispose of Financed Student Loans as
and to the extent permitted or required by this Indenture or the Master
Servicing Agreement, and (ii) make cash payments out of the Accounts as and to
the extent permitted or required by this Indenture.

          (g)  In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.

          (h)  Any certificate or opinion of an Authorized Officer may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such Authorized Officer knows or in the
exercise of reasonable care should know, that the certificate or opinion or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such certificate or Opinion of Counsel may
be based, insofar as it relates to factual matters, upon a certificate or
opinion of, or representations by, an officer or officer of any Master Servicer
or the Issuer, stating that the information with respect to such factual matters
is in the possession of such Master Servicer or the Issuer, unless such counsel
knows, or in the exercise of reasonable care should know, that the certificate
or opinion or representations with respect to such matters are erroneous.

          (i)  Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.

          (j)  Whenever in this Indenture or in any Supplemental Indenture, in
connection with any application or certificate or report to the Indenture
Trustee, it is provided that the Issuer shall deliver any document as a
condition of granting such application, or as evidence of the Issuer's
compliance with any term hereof, it is intended that the truth and accuracy, at
the time of the granting of such application or at the effective date of such
certificate or report, as the case may be, of the facts and opinions stated in
such document shall in such case

                                       72
                                                              Indenture of Trust

<PAGE>

be conditions precedent to the right of the Issuer to have such application
granted or to the sufficiency of such certificate or report. The foregoing,
shall not, however, be construed to affect the Indenture Trustee's right to rely
upon the truth and accuracy of any statement or opinion contained in any such
document as provided in Article VI.

          (k)  Nothing in this Section 11.05 shall be construed either as
requiring the inclusion in this Indenture or in any Supplemental Indenture of
provisions that the Issuer shall furnish to the Indenture Trustee any other
evidence of compliance with the conditions and covenants provided for in this
Indenture or in any Supplemental Indenture than the evidence specified in this
Section 11.05, or as preventing the inclusion of such provisions in this
Indenture or in any Supplemental Indenture, if the parties hereto agree.

          Section 11.06 Incorporation by Reference of the Trust Indenture Act.
Whenever this Indenture or any Supplemental Indenture refers to a provision of
the Trust Indenture Act, the provision is incorporated by reference in and made
a part of this Indenture. The following terms used in the Trust Indenture Act
shall have the following meanings insofar as such terms are incorporated into
this Indenture pursuant to this Section 11.06.

          "Commission" shall mean the Commission.

          "indenture securities" shall mean the Notes issued and Outstanding
under this Indenture.

          "indenture security holder" shall mean a Noteholder.

          "indenture to be qualified" shall mean this Indenture.

          "indenture trustee" or "institutional trustee" shall mean the
Indenture Trustee.

          "obligor" on the indenture securities shall mean the Issuer.

          All other terms from the Trust Indenture Act used in this Indenture
that are defined by the Trust Indenture Act, defined by reference in the Trust
Indenture Act to another statute or defined by Commission rule shall have the
meaning assigned to them by such definition in the Trust Indenture Act.

                  [Remainder of page intentionally left blank.]

                                       73
                                                              Indenture of Trust

<PAGE>

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

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

                                        By:  /s/ Angela M. Weidell-LaBathe
                                           -------------------------------------
                                             Name: Angela M. Weidell-LaBathe
                                             Title: Assistant Vice President
                                                     and Senior Trust Officer

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

                                        By:  /s/ Angela M. Weidell-LaBathe
                                           -------------------------------------
                                             Name: Angela M. Weidell-LaBathe
                                             Title: Assistant Vice President
                                                     and Senior Trust Officer

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

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

                                        By:  /s/ Angela M. Weidell-LaBathe
                                           -------------------------------------
                                             Name: Angela M. Weidell-LaBathe
                                             Title: Assistant Vice President
                                                     and Senior Trust Officer

          Education Lending Services, Inc. hereby acknowledges and accepts the
duties and obligations assigned to the Master Servicer in Article XI.

                                        Education Lending Services, Inc.,
                                        as Master Servicer

                                        By:  /s/ Perry D. Moore
                                             -----------------------------------
                                             Name:   Perry D. Moore
                                             Title:  Senior Vice President-
                                                     Finance

                                                              Indenture of Trust

<PAGE>

                                   Exhibit A-1

                              Form of Class A Notes

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

EXCEPT AS OTHERWISE PROVIDED IN THE INDENTURE, THIS GLOBAL NOTE MAY BE
TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES
DEPOSITORY (AS DEFINED IN THE INDENTURE) OR TO A SUCCESSOR SECURITIES DEPOSITORY
OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY.

                       EDUCATION FUNDING CAPITAL TRUST-III
                           EDUCATION LOAN BACKED NOTE
                                  SERIES A-___

REGISTERED NO. A-__                                       REGISTERED $__________

MATURITY DATE           INTEREST RATE      ORIGINAL ISSUE DATE      CUSIP NO.
-------------         ------------------   -------------------      ---------
______, 20___         As Herein Provided   ______, 20___            _________

PRINCIPAL SUM: ________ DOLLARS
NOTEHOLDER: CEDE & CO.

     EDUCATION FUNDING CAPITAL TRUST-III, a statutory trust formed under the
laws of the State of Delaware (the "Issuer") for value received, hereby promises
to pay to CEDE & CO. (the "Noteholder") or registered assigns, ____ DOLLARS (the
"Principal Sum"), but solely from the revenues and receipts hereinafter
specified and not otherwise, on ______, 20___ (the "Maturity Date") (subject to
the right of prior redemption hereinafter described), upon presentation and
surrender of this Note at the Corporate Trust Office of the Indenture Trustee,
as paying agent for the Notes, or a duly appointed successor paying agent, and
to pay interest in arrears on said Principal Sum, but solely from the revenues
and receipts hereinafter specified and not otherwise, to the Noteholder hereof
from the most recent Distribution Date to which interest has been paid hereon,
until the payment in full of the Principal Sum.

                                      A-1-1
                                                              Indenture of Trust

<PAGE>

     Any capitalized words and terms used as defined words and terms in this
Note and not otherwise defined herein shall have the meanings given to them in
the Indenture of Trust dated as of October 1, 2003 (the "Indenture") among the
Issuer, Fifth Third Bank, as Indenture Trustee, and Fifth Third Bank, as Trust
Eligible Lender Trustee.

For Auction Rate Notes:

     [This Note shall bear interest at an Auction Rate, all as determined in
Appendix B of the Indenture. The principal of and interest on this Note are
payable in lawful money of the United States of America. Interest payable on
this Note shall be computed on the assumption that each year contains 360 days
and actual days elapsed.]

For LIBOR Notes:

     [This Note shall bear interest at a rate equal to three-month LIBOR, as
determined in accordance with Section 1.01(c) of the Indenture, plus ___
percent; provided, however, LIBOR for the first Accrual Period shall be
determined by the Indenture Trustee by reference to straight line interpolation
between one-month LIBOR and two-month LIBOR based on the actual number of days
in the first Accrual Period.

     The principal of and interest on this Note are payable in lawful money of
the United States of America. Interest payable on this Note shall be computed on
the assumption that each year contains 360 days and actual days elapsed.]

     This Note is one of a Series of Notes of the Issuer designated Education
Loan Backed Notes, Series A-___, dated _____, 2003 (the "Original Issue Date"),
in the aggregate original principal amount of $__________ (the "Series A-___
Notes"), which have been authorized and issued by the Issuer pursuant to the
Indenture. The Issuer is, simultaneously with the issuance of the Series A-___
Notes, issuing $__________ of its Education Loan Backed Notes, Series A-___ (the
"Series A-___ Notes"), $__________ of its Education Loan Backed Notes, Series
A-___ (the "Series A-___ Notes"), $__________ of its Education Loan Backed
Notes, Series A-___ (the "Series A-___ Notes"), $__________ of its Education
Loan Backed Notes, Series A-___ (the "Series A-___ Notes"), $__________ of its
Education Loan Backed Notes, Series A-___ (the "Series A-___ Notes"),
$__________ of its Education Loan Backed Notes, Series A-___ (the "Series A-___
Notes"), $__________ of its Education Loan Backed Notes, Series A-___ (the
"Series A-___ Notes"), and $________ of its Education Loan Backed Notes, Series
B-1 Notes (the "Series B-1 Notes"). The proceeds of such Notes shall be used by
the Issuer, together with other moneys of the Issuer, for the purpose of
providing funds to finance the acquisition of education loans, to fund a
capitalized interest account, to fund a reserve account and to pay certain costs
and expenses in connection with the issuance of such Notes.

     Under the Indenture, the Series A-1 Notes, the Series A-2 Notes, the Series
A-3 Notes, the Series A-4 Notes, the Series A-5 Notes, the Series A-6 Notes, the
Series A-7 Notes, and the Series A-8 Notes are defined as "Class A Notes"; and
the Series B-1 Notes are defined as "Class B Notes". The Class A Notes and the
Class B Notes are collectively referred to herein as the "Notes".

                                      A-1-2
                                                              Indenture of Trust

<PAGE>

     Under the Indenture, the Series A-1 Notes, the Series A-2 Notes, and the
Series A-3 Notes are defined as "LIBOR Notes"; and the Series A-4 Notes, the
Series A-5 Notes, the Series A-6 Notes, the Series A-7 Notes, the Series A-8
Notes and the Series B-1 Notes are defined as "Auction Rate Notes".

     This Note is subject to mandatory redemption and optional redemption, all
as described in the Indenture.

     Notice of the call for redemption shall be given by the Indenture Trustee
by mailing a copy of the notice at least 12 days prior to the redemption date to
the Noteholders of the Notes to be redeemed in whole or in part at the address
of such Noteholder last showing on the registration books. Failure to give such
notice or any defect therein shall not affect the validity of any proceedings
for the redemption of such Notes for which no such failure or defect occurs. All
Notes called for redemption will cease to bear interest after the specified
redemption date, provided funds for their payment are on deposit at the place of
payment at the time. If less than all Notes are to be redeemed, Notes shall be
selected for redemption as provided in the Indenture.

     The Indenture provides that the Issuer may enter into a Derivative Product
between the Issuer and a Counterparty. Payments due to a Counterparty from the
Issuer pursuant to the applicable Derivative Product may be secured on a parity
with any Series of Notes.

     The principal of and interest on the Class A Notes and any Scheduled Issuer
Derivative Payments and Specified Issuer Termination Payments under Derivative
Products secured on a parity with the Class A Notes are payable on a superior
basis to payments of principal of and interest on the Class B Notes and any
Scheduled Issuer Derivative Payments and Specified Issuer Termination Payments
under Derivative Products secured on a parity with the Class B Notes; provided,
however, that current principal and interest may be paid on the Class B Notes
and Scheduled Issuer Derivative Payments and Specified Issuer Termination
Payments under Derivative Products secured on a parity with the Class B Notes
may be paid if all principal and interest payments due and owing at such time on
the Class A Notes and Scheduled Issuer Derivative Payments and Specified Issuer
Termination Payments under Derivative Products secured on a parity with the
Class A Notes previously have been made or provided for as provided in the
Indenture [Insert the following for Auction Rate Notes] [; provided, further,
however, that under certain circumstances described in Section 1.02(c) of the
Indenture, principal may be paid on the Class B Auction Rate Notes before
principal is paid on the Class A Auction Rate Notes].

     Reference is hereby made to the Indenture, a copy of which is on file in
the Corporate Trust Office of the Indenture Trustee, to all of the provisions of
which any Noteholder of this Note by his acceptance hereof hereby assents, for
definitions of terms; the description of and the nature and extent of the
security for the Notes; the Issuer's education loan origination and acquisition
program; the revenues and other money pledged to the payment of the principal of
and interest on the Notes; the nature and extent and manner of enforcement of
the pledge; the conditions upon which the Indenture may be amended or
supplemented with or without the consent of the Noteholders and any
Counterparty; the rights and remedies of the Noteholder

                                      A-1-3
                                                              Indenture of Trust

<PAGE>

hereof with respect hereto and thereto, including the limitations upon the right
of a Noteholder hereof to institute any suit, action, or proceeding in equity or
at law with respect hereto and thereto; the rights, duties, and obligations of
the Issuer and the Indenture Trustee thereunder; the terms and provisions upon
which the liens, pledges, charges, trusts, and covenants made therein may be
discharged at or prior to the Stated Maturity or earlier redemption of this
Note, and this Note thereafter shall no longer be secured by the Indenture or be
deemed to be Outstanding thereunder; and for the other terms and provisions
thereof.

     THE NOTES ARE LIMITED OBLIGATIONS OF THE ISSUER, PAYABLE SOLELY FROM, AND
FURTHER SECURED BY, THE TRUST ESTATE, AS DEFINED IN THE INDENTURE.

     No recourse, either directly or indirectly, shall be had for the payment of
the principal of and interest on this Note or any claim based hereon or in
respect hereof or of the Indenture, against the Indenture Trustee, or any
employee, or agent of the Issuer, nor against the State of Delaware, or any
official thereof, but the obligation to pay all amounts required by the
Indenture securing this Note and the obligation to do and perform the covenants
and acts required of the Issuer therein and herein shall be and remain the
responsibility and obligation of said Issuer, limited as herein set forth.

     Subject to the restrictions specified in the Indenture, this Note is
transferable on the registration books kept for that purpose by the Indenture
Trustee, as registrar, upon surrender of this Note for transfer at the Corporate
Trust Office of the Indenture Trustee, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Noteholder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of the same Series, Stated
Maturity, of Authorized Denominations, bearing interest at the same rate, and
for the same aggregate principal amount will be issued to the designated
transferee or transferees. At the option of the Noteholder, any Note may be
exchanged for other Notes in Authorized Denominations upon surrender of the Note
to be exchanged at the Corporate Trust Office of the Indenture Trustee. Upon any
such presentation for exchange, one or more new Notes of the same Series, Stated
Maturity, in Authorized Denominations, bearing interest at the same rate, and
for the same aggregate principal amount as the Note or Notes so surrendered will
be issued to the Noteholder of the Note or Notes so surrendered; and the Note or
Notes so surrendered shall thereupon be cancelled by the Indenture Trustee.

     Notwithstanding the foregoing, so long as the ownership of the Notes is
maintained in book-entry form by The Depository Trust Company (the "Securities
Depository") or a nominee thereof, this Note may be transferred in whole but not
in part only to the Securities Depository or a nominee thereof or to a successor
Securities Depository or its nominee.

     The Issuer, the Indenture Trustee, and any agent of either of them shall
treat the Person in whose name this Note is registered as the Noteholder hereof
(a) on the record date for purposes of receiving timely payment of interest
hereon, and (b) on the date of surrender of this Note for purposes of receiving
payment of principal hereof at its Stated Maturity and (c) for all other

                                      A-1-4
                                                              Indenture of Trust

<PAGE>

purposes, whether or not this Note is overdue, and neither the Issuer, the
Indenture Trustee, nor any such agent shall be affected by notice to the
contrary.

     To the extent permitted by the Indenture, modifications or alterations of
the Indenture may be made with the consent of less than all of the holders of
the Notes then Outstanding or without the consent of any of such Noteholders (by
reason of a change in the Act or the Regulations, to cure ambiguities or
conflicts, or for any other reason stated in Section 7.01 of the Indenture), but
such modification or alteration is not permitted to affect the Maturity, Stated
Maturity, amount, Distribution Date, or rate of interest on any Outstanding
Notes or affect the rights of the Noteholders of less than all of the Notes
Outstanding.

     It is hereby certified and recited that all acts and things required by the
laws of the State of Delaware to happen, exist, and be performed precedent to
and in the issuance of this Note, and the execution of said Indenture, have
happened, exist and have been performed as so required.

                                      A-1-5
                                                              Indenture of Trust

<PAGE>

     IN WITNESS WHEREOF, the Issuer has caused this Note to be executed in its
name and on its behalf, all as of the Original Issue Date.

                                        EDUCATION FUNDING CAPITAL TRUST-III

                                        By:  Fifth Third Bank,
                                             as Co-Owner Trustee,

                                        By
                                           -------------------------------------
                                             Name:
                                             Title:

                                      A-1-6
                                                              Indenture of Trust

<PAGE>

                          CERTIFICATE OF AUTHENTICATION

     This Note is one of the Series A-__ Notes designated therein and described
in the within-mentioned Indenture.

                                        FIFTH THIRD BANK, as Indenture Trustee

                                        By:
                                           -------------------------------------
                                           Authorized Signatory

Authentication Date:

----------------------------------------

                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
unto _______ (Social Security or other identifying number __________) the within
Note and all rights thereunder and hereby irrevocably appoints _______ attorney
to transfer the within Note on the books kept for registration thereof, with
full power of substitution in the premises.

Dated:                                       Signed:

----------------------------------------     -----------------------------------

                                             NOTICE:  The signature on this
                                             Assignment must correspond with the
                                             name of the Noteholder as it
                                             appears on the face of the within
                                             Note  in  every particular.

Signature Guaranteed by:

----------------------------------------
A Member of The New York Stock
Exchange or a State or National Bank

                                      A-1-7
                                                              Indenture of Trust

<PAGE>
                                   Exhibit A-2

                              Form of Class B Notes

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR
REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.

EXCEPT AS OTHERWISE PROVIDED IN THE INDENTURE, THIS GLOBAL NOTE MAY BE
TRANSFERRED, IN WHOLE BUT NOT IN PART, ONLY TO ANOTHER NOMINEE OF THE SECURITIES
DEPOSITORY (AS DEFINED IN THE INDENTURE) OR TO A SUCCESSOR SECURITIES DEPOSITORY
OR TO A NOMINEE OF A SUCCESSOR SECURITIES DEPOSITORY.

                       EDUCATION FUNDING CAPITAL TRUST-III
                           EDUCATION LOAN BACKED NOTE
                                   SERIES B-1

REGISTERED NO. A-__                                        REGISTERED $---------

MATURITY DATE       INTEREST RATE       ORIGINAL ISSUE DATE            CUSIP NO.
-------------       -------------       -------------------            ---------

_____      As Herein Provided    __________, 20___        __________

PRINCIPAL SUM:  __________ DOLLARS
NOTEHOLDER: CEDE & CO.

     EDUCATION FUNDING CAPITAL TRUST-III, a statutory trust formed under the
laws of the State of Delaware (the "Issuer") for value received, hereby promises
to pay to CEDE & CO. (the "Noteholder") or registered assigns, __________
Dollars (the "Principal Sum"), but solely from the revenues and receipts
hereinafter specified and not otherwise, on ______ (the "Maturity Date")
(subject to the right of prior redemption hereinafter described), upon
presentation and surrender of this Note at the Corporate Trust Office of the
Indenture Trustee, as paying agent for the Notes, or a duly appointed successor
paying agent, and to pay interest in arrears on said Principal Sum, but solely
from the revenues and receipts hereinafter specified and not otherwise, to the
Noteholder hereof from the most recent Distribution Date to which interest has
been paid hereon, until the payment in full of the Principal Sum.

                                      A-2-1
                                                              Indenture of Trust

<PAGE>

     Any capitalized words and terms used as defined words and terms in this
Note and not otherwise defined herein shall have the meanings given to them in
the Indenture of Trust dated as of October 1, 2003 (the "Indenture") among the
Issuer, Fifth Third Bank, as Indenture Trustee, and Fifth Third Bank, as Trust
Eligible Lender Trustee.

     This Note shall bear interest at an Auction Rate, all as determined in
Appendix B of the Indenture. The principal of and interest on this Note are
payable in lawful money of the United States of America. Interest payable on
this Note shall be computed on the assumption that each year contains 360 days
and actual days elapsed.

     This Note is one of a Series of Notes of the Issuer designated Education
Loan Backed Notes, Series B-1, dated _______, 2003 (the "Original Issue Date"),
in the aggregate original principal amount of $________ (the "Series B-1
Notes"), which have been authorized by the Issuer, and issued by the Issuer
pursuant to the Indenture. The Issuer is, simultaneously with the issuance of
the Series B-1 Notes, issuing $_______ of its Education Loan Backed Notes,
Series A-1 (the "Series A-1 Notes"), $________ of its Education Loan Backed
Notes, Series A-2 (the "Series A-2 Notes"), $_______ of its Education Loan
Backed Notes, Series A-3 (the "Series A-3 Notes"), $________ of its Education
Loan Backed Notes, Series A-4 (the "Series A-4 Notes"), $_______ of its
Education Loan Backed Notes, Series A-5 (the "Series A-5 Notes"), $______ of its
Education Loan Backed Notes, Series A-6 (the "Series A-6 Notes"), $______ of its
Education Loan Backed Notes, Series A-7 (the "Series A-7 Notes"), and $______ of
its Education Loan Backed Notes, Series A-8 Notes (the "Series A-8 Notes"). The
proceeds of such Notes shall be used by the Issuer, together with other moneys
of the Issuer, for the purpose of providing funds to finance the acquisition of
education loans, to fund a capitalized interest account, to fund a reserve
account and to pay certain costs and expenses in connection with the issuance of
such Notes.

     Under the Indenture, the Series A-1 Notes, the Series A-2 Notes, the Series
A-3 Notes, the Series A-4 Notes, the Series A-5 Notes, the Series A-6 Notes, the
Series A-7 Notes, and the Series A-8 Notes are defined as "Class A Notes"; and
the Series B-1 Notes are defined as "Class B Notes". The Class A Notes and the
Class B Notes are collectively referred to herein as the "Notes".

     Under the Indenture, the Series A-1 Notes, the Series A-2 Notes, and the
Series A-3 Notes are defined as "LIBOR Notes"; and the Series A-4 Notes, the
Series A-5 Notes, the Series A-6 Notes, the Series A-7 Notes, the Series A-8
Notes and the Series B-1 Notes are defined as "Auction Rate Notes".

     This Note is subject to mandatory redemption and optional redemption, all
as described in the Indenture.

     Notice of the call for redemption shall be given by the Indenture Trustee
by mailing a copy of the notice at least 12 days prior to the redemption date to
the Noteholders of the Notes to be redeemed in whole or in part at the address
of such Noteholder last showing on the registration books. Failure to give such
notice or any defect therein shall not affect the validity of any proceedings
for the redemption of such Notes for which no such failure or defect occurs. All

                                      A-2-2
                                                              Indenture of Trust

<PAGE>

Notes called for redemption will cease to bear interest after the specified
redemption date, provided funds for their payment are on deposit at the place of
payment at the time. If less than all Notes are to be redeemed, Notes shall be
selected for redemption as provided in the Indenture.

     The Indenture provides that the Issuer may enter into a Derivative Product
between the Issuer and a Counterparty. Payments due to a Counterparty from the
Issuer pursuant to the applicable Derivative Product may be secured on a parity
with any Series of Notes.

     The principal of and interest on the Class A Notes and any Scheduled Issuer
Derivative Payments and Specified Issuer Termination Payments under Derivative
Products secured on a parity with the Class A Notes are payable on a superior
basis to payments of principal of and interest on the Class B Notes and any
Scheduled Issuer Derivative Payments and Specified Issuer Termination Payments
under Derivative Products secured on a parity with the Class B Notes; provided,
however, that current principal and interest may be paid on the Class B Notes
and Scheduled Issuer Derivative Payments and Specified Issuer Termination
Payments under Derivative Products secured on a parity with the Class B Notes
may be paid if all principal and interest payments due and owing at such time on
the Class A Notes and Scheduled Issuer Derivative Payments and Specified Issuer
Termination Payments under Derivative Products secured on a parity with the
Class A Notes previously have been made or provided for as provided in the
Indenture; provided, further, however, that under certain circumstances
described in Section 1.02(c) of the Indenture, principal may be paid on the
Class B Auction Rate Notes before principal is paid on the Class A Auction Rate
Notes.

     Reference is hereby made to the Indenture, a copy of which is on file in
the Corporate Trust Office of the Indenture Trustee, to all of the provisions of
which any Noteholder of this Note by his acceptance hereof hereby assents, for
definitions of terms; the description of and the nature and extent of the
security for the Notes; the Issuer's education loan origination and acquisition
program; the revenues and other money pledged to the payment of the principal of
and interest on the Notes; the nature and extent and manner of enforcement of
the pledge; the conditions upon which the Indenture may be amended or
supplemented with or without the consent of the Noteholders and any
Counterparty; the rights and remedies of the Noteholder hereof with respect
hereto and thereto, including the limitations upon the right of a Noteholder
hereof to institute any suit, action, or proceeding in equity or at law with
respect hereto and thereto; the rights, duties, and obligations of the Issuer
and the Indenture Trustee thereunder; the terms and provisions upon which the
liens, pledges, charges, trusts, and covenants made therein may be discharged at
or prior to the Stated Maturity or earlier redemption of this Note, and this
Note thereafter shall no longer be secured by the Indenture or be deemed to be
Outstanding thereunder; and for the other terms and provisions thereof.

     THE NOTES ARE LIMITED OBLIGATIONS OF THE ISSUER, PAYABLE SOLELY FROM, AND
FURTHER SECURED BY, THE TRUST ESTATE, AS DEFINED IN THE INDENTURE.

     No recourse, either directly or indirectly, shall be had for the payment of
the principal of and interest on this Note or any claim based hereon or in
respect hereof or of the Indenture, against the Indenture Trustee, or any
employee, or agent of the Issuer, nor against the State of

                                      A-2-3
                                                              Indenture of Trust

<PAGE>

Delaware, or any official thereof, but the obligation to pay all amounts
required by the Indenture securing this Note and the obligation to do and
perform the covenants and acts required of the Issuer therein and herein shall
be and remain the responsibility and obligation of said Issuer, limited as
herein set forth.

     Subject to the restrictions specified in the Indenture, this Note is
transferable on the registration books kept for that purpose by the Indenture
Trustee, as registrar, upon surrender of this Note for transfer at the Corporate
Trust Office of the Indenture Trustee, duly endorsed by, or accompanied by a
written instrument of transfer in form satisfactory to the Indenture Trustee
duly executed by, the Noteholder hereof or his attorney duly authorized in
writing, and thereupon one or more new Notes of the same Series, Stated
Maturity, of Authorized Denominations, bearing interest at the same rate, and
for the same aggregate principal amount will be issued to the designated
transferee or transferees. At the option of the Noteholder, any Note may be
exchanged for other Notes in Authorized Denominations upon surrender of the Note
to be exchanged at the Corporate Trust Office of the Indenture Trustee. Upon any
such presentation for exchange, one or more new Notes of the same Series, Stated
Maturity, in Authorized Denominations, bearing interest at the same rate, and
for the same aggregate principal amount as the Note or Notes so surrendered will
be issued to the Noteholder of the Note or Notes so surrendered; and the Note or
Notes so surrendered shall thereupon be cancelled by the Indenture Trustee.

     Notwithstanding the foregoing, so long as the ownership of the Notes is
maintained in book-entry form by The Depository Trust Company (the "Securities
Depository") or a nominee thereof, this Note may be transferred in whole but not
in part only to the Securities Depository or a nominee thereof or to a successor
Securities Depository or its nominee.

     The Issuer, the Indenture Trustee, and any agent of either of them shall
treat the Person in whose name this Note is registered as the Noteholder hereof
(a) on the record date for purposes of receiving timely payment of interest
hereon, and (b) on the date of surrender of this Note for purposes of receiving
payment of principal hereof at its Stated Maturity and (c) for all other
purposes, whether or not this Note is overdue, and neither the Issuer, the
Indenture Trustee, nor any such agent shall be affected by notice to the
contrary.

     To the extent permitted by the Indenture, modifications or alterations of
the Indenture may be made with the consent of less than all of the holders of
the Notes then Outstanding or without the consent of any of such Noteholders (by
reason of a change in the Act or the Regulations, to cure ambiguities or
conflicts, or for any other reason stated in Section 7.01 of the Indenture), but
such modification or alteration is not permitted to affect the Maturity, Stated
Maturity, amount, Distribution Date, or rate of interest on any Outstanding
Notes or affect the rights of the Noteholders of less than all of the Notes
Outstanding.

     It is hereby certified and recited that all acts and things required by the
laws of the State of Delaware to happen, exist, and be performed precedent to
and in the issuance of this Note, and the execution of said Indenture, have
happened, exist and have been performed as so required.

                                      A-2-4
                                                              Indenture of Trust

<PAGE>

     IN WITNESS WHEREOF, the Issuer has caused this Note to be executed in its
name and on its behalf, all as of the Original Issue Date.

                                        EDUCATION FUNDING CAPITAL TRUST-III

                                        By: Fifth Third Bank,
                                            as Co-Owner Trustee,

                                        By
                                          --------------------------------------
                                            Name:
                                            Title:

                                      A-2-5
                                                              Indenture of Trust

<PAGE>

                          CERTIFICATE OF AUTHENTICATION

     This Note is one of the Series B-1 Notes designated therein and described
in the within-mentioned Indenture.

                                        FIFTH THIRD BANK, as Indenture Trustee

                                        By:
                                           -------------------------------------
                                           Authorized Signatory

Authentication Date:

------------------------------

                                   ASSIGNMENT

     FOR VALUE RECEIVED, the undersigned hereby sells, assigns, and transfers
unto __________ (Social Security or other identifying number __________) the
within Note and all rights thereunder and hereby irrevocably appoints __________
attorney to transfer the within Note on the books kept for registration thereof,
with full power of substitution in the premises.

Dated:                                  Signed:

------------------------------          ----------------------------------------
                                        NOTICE: The signature on this Assignment
                                        must correspond with the name of the
                                        Noteholder as it appears on the face of
                                        the within Note in every particular.

Signature Guaranteed by:

-----------------------------
A Member of The New York
Stock Exchange or a State or
National Bank

                                      A-2-6
                                                              Indenture of Trust

<PAGE>

                                    Exhibit B

                      Student Loan Acquisition Certificate

          This Student Loan Acquisition Certificate (this "Certificate") is
submitted pursuant to the provisions of Section 4.02 of the Indenture of Trust
dated as of October 1, 2003 (the "Indenture") among Education Funding Capital
Trust-III (the "Issuer"), Fifth Third Bank, as Indenture Trustee, and Fifth
Third Bank, as Trust Eligible Lender Trustee. All capitalized terms used in this
Certificate and not otherwise defined herein shall have the same meanings given
to such terms in the Indenture. In your capacity as Indenture Trustee, you are
hereby authorized and requested to disburse to Education Lending Services, Inc.
the sum of $__________ (or, in the case of an exchange, the Student Loans listed
in Exhibit A hereto) for the acquisition of Student Loans. With respect to the
Student Loans so to be acquired, the Issuer hereby certifies as follows:

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

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

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

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

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

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

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

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

                                        1
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

                                        2
                                                              Indenture of Trust

<PAGE>

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

                  [Remainder of page intentionally left blank.]

                                        3
                                                              Indenture of Trust

<PAGE>

                Witness my hand this ___ day of __________ 20___.

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

                                        By:
                                            ------------------------------------
                                             Name:
                                             Title:

                                        4
                                                              Indenture of Trust

<PAGE>

                                   Schedule A

                          Student Loans To Be Acquired

                                                              Indenture of Trust

<PAGE>

                                   Appendix A
                              Definitions And Usage

                                      Usage
                                      -----

          The following rules of construction and usage shall be applicable to
any instrument that is governed by this Appendix:

          (a) All terms defined in this Appendix shall have the defined meanings
when used in any agreement or instrument incorporating this Appendix and in any
certificate or other document made or delivered pursuant thereto unless
otherwise defined therein.

          (b) As used herein, in any agreement or instrument incorporating this
Appendix and in any certificate or other document made or delivered pursuant
thereto, accounting terms not defined in this Appendix or in any such agreement
or instrument, certificate or other document, and accounting terms partly
defined in this Appendix or in any such agreement or instrument, certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles as in effect on the
date of such instrument. To the extent that the definitions of accounting terms
in this Appendix or in any such agreement or instrument, certificate or other
document are inconsistent with the meanings of such terms under generally
accepted accounting principles, the definitions contained in this Appendix or in
any such agreement or instrument, certificate or other document shall control.

          (c) The words "hereof," "herein," "hereunder," and words of similar
import when used in an agreement or instrument refer to such agreement or
instrument as a whole and not to any particular provision or subdivision
thereof; references in an agreement or instrument to "Article", "Section" or
another subdivision or to an attachment are, unless the context otherwise
requires, to an article, section or subdivision of or an attachment to such
agreement or instrument; and the term "including" means "including without
limitation."

          (d) The definitions contained in this Appendix are equally applicable
to both the singular and plural forms of such terms and to the masculine as well
as to the feminine and neuter genders of such terms.

          (e) Any agreement, instrument or statute defined or referred to below
or in any agreement or instrument that is governed by this Appendix means such
agreement or instrument or statute as from time to time amended, modified or
supplemented, including (in the case of agreements or instruments) by waiver or
consent and (in the case of statutes) by succession of comparable successor
statutes and includes (in the case of agreements or instruments) references to
all attachments thereto and instruments incorporated therein. References to a
Person are also to its permitted successors and assigns.

                                       A-1
                                                              Indenture of Trust

<PAGE>

                                   Definitions
                                   -----------

     "Accounts" means any accounts established pursuant to Section 4.01 of the
Indenture.

     "Accrual Period" with respect to a Series of Auction Rate Notes means,
initially, the period beginning on the Closing Date and ending on the Initial
Auction Date for that Series, and thereafter, the period beginning on an Auction
Rate Distribution Date for that Series and ending on the day before the next
Auction Rate Distribution Date for that Series; "Accrual Period" with respect to
a Series of LIBOR Notes means, initially, the period beginning on the Closing
Date and ending on December 14, 2003, the day before the first Quarterly
Distribution Date, and thereafter, the period beginning on a Quarterly
Distribution Date and ending on the day before the next Quarterly Distribution
Date.

     "Acquisition Account" means the Account bearing that name established
pursuant to Section 4.01 of the Indenture, including any Subaccounts created
therein.

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

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

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

     "Administration Agreement" means the Administration Agreement dated as of
October 1, 2003, between the Issuer and the Administrator.

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

     "Administrator" means Education Lending Services, Inc., in its capacity as
administrator of the Issuer and the Financed Student Loans, and any successor
thereto.

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

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

     "Affiliate" means, with respect to any specified Person, any other Person
controlling or controlled by or under common control with such specified Person.
For the purposes of this definition, "control" when used with respect to any
specified Person means the power to direct the management and policies of such
Person, directly or indirectly, whether through the

                                       A-2
                                                              Indenture of Trust

<PAGE>

ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.

     "Auction Agent Agreement" shall have the meaning given to that term in
Appendix B.

     "Auction Rate Distribution Dates" means each Payment Date (as defined in
Appendix B).

     "Auction Rate Notes" means the Series A-4 Notes, the Series A-5 Notes, the
Series A-6 Notes, the Series A-7 Notes, the Series A-8 Notes and the Series B-1
Notes.

     "Authorized Denominations" with respect to the LIBOR Notes means $1,000 and
any integral multiple thereof, and with respect to the Auction Rate Notes means
$50,000 and any integral multiple thereof.

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

     "Available Funds" means, as to a Distribution Date or any related Monthly
Expense Payment Date, the sum of the following amounts for the related
Collection Period or, in the case of an Auction Rate Distribution Date occurring
while any LIBOR Notes remain Outstanding, the applicable portion of these
amounts:

     (i)    all collections received by the Master Servicer on the Financed
            Student Loans, including any Guarantee Payments received on the
            Financed Student Loans, but net of:

            (1) any collections in respect of principal on the Financed Student
                Loans applied by the Issuer to repurchase Guaranteed Student
                Loans from the Guarantors under the Guarantee Agreements, and

            (2) amounts required by the Act to be paid to the Department or to
                be repaid to borrowers, whether or not in the form of a
                principal reduction of the applicable Financed Student Loan, on
                the Financed Student Loans for that Collection Period including
                Consolidation Loan rebate fees;

                                       A-3
                                                              Indenture of Trust

<PAGE>

     (ii)   any Interest Subsidy Payments and Special Allowance Payments
            received by the Master Servicer or the Trust Eligible Lender Trustee
            during that Collection Period for the Financed Student Loans;

     (iii)  all proceeds of the liquidation of defaulted Financed Student Loans
            that were liquidated during that Collection Period in accordance
            with the Master Servicer's customary servicing procedures, net of
            expenses incurred by the Master Servicer related to their
            liquidation and any amounts required by law to be remitted to the
            borrower on the liquidated Financed Student Loans, and all
            recoveries on liquidated Financed Student Loans that were written
            off in prior Collection Periods or during that Collection Period;

     (iv)   the aggregate purchase amounts received during that Collection
            Period for those Financed Student Loans repurchased by the Depositor
            or purchased by the Master Servicer or for Financed Student Loans
            sold to another Eligible Lender pursuant to the Master Servicing
            Agreement;

     (v)    the aggregate purchase amounts received during that Collection
            Period for those Student Loans purchased by the Seller;

     (vi)   the aggregate amounts, if any, received from the Seller, the
            Depositor or the Master Servicer, as the case may be, as
            reimbursement of non-guaranteed interest amounts, or lost Interest
            Subsidy Payments and Special Allowance Payments, on the Financed
            Student Loans pursuant to the Transfer and Sale Agreements or the
            Master Servicing Agreement;

     (vii)  amounts received by the Issuer pursuant to the Master Servicing
            Agreement during that Collection Period as to yield or principal
            adjustments; and

     (viii) investment earnings on that Distribution Date and any interest
            remitted by the Indenture Trustee to the Collection Account prior to
            such Distribution Date or Monthly Expense Payment Date;

     provided that if on any Distribution Date there would not be sufficient
funds, after application of Available Funds, as defined above, and application
of amounts available from the Capitalized Interest Account and the Reserve
Account, to pay the Monthly Issuer Fees and the items specified in clauses (i)
and (ii) of each of Sections 4.03(d) and (e) (but excluding each clause (ii),
and including clauses (iii) through (xii) of Section 4.03(d), in the event that
a condition exists as described in either of clause (i) or (ii) of Section
1.02(c)), then Available Funds on that Distribution Date will include, in
addition to the Available Funds as defined above, amounts on deposit in the
Collection Account, or amounts held by the Indenture Trustee, or which the
Indenture Trustee reasonably estimates to be held by the Indenture Trustee, for
deposit into the Collection Account which would have constituted Available Funds
for the Distribution Date succeeding that Distribution Date, up to the amount
necessary to pay such items, and the Available Funds for the succeeding
Distribution Date will be adjusted accordingly.

                                       A-4
                                                              Indenture of Trust

<PAGE>

     "Bailments" means collectively the Bailment Notice and Acknowledgement
dated October 1, 2003 among the Trust, the Trust Eligible Lender Trustee, the
Indenture Trustee and Great Lakes Educational Loan Services, Inc., and the
Bailment Notice and Acknowledgement dated October 1, 2003 among the Trust, the
Trust Eligible Lender Trustee, the Indenture Trustee and ACS Education Services,
Inc.

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

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

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

     "Broker-Dealer Agreement" shall have the meaning given to that term in
Appendix B.

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

     "Calculation Agent" means Citigroup Global Markets Inc.

     "Capitalized Interest Account" means the Account bearing that name
established pursuant to Section 4.01 of the Indenture, including any Subaccounts
created therein.

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

     "Certificate Distribution Account" shall have the meaning given to that
term in the Trust Agreement.

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

     "Class A Note Interest Shortfall" means, for any Distribution Date, the
sum, for all of the Class A Notes with a Distribution Date on this Distribution
Date, of the excess of:

                                       A-5
                                                              Indenture of Trust

<PAGE>

     (i)    the amount of interest (excluding Carry-over Amounts) that was
            payable on each Series of Class A Notes with a Distribution Date on
            this Distribution Date on the preceding Distribution Date for the
            Series, over

     (ii)   the amount of interest actually distributed with respect to these
            Class A Notes on that preceding Distribution Date, plus interest on
            the amount of that excess, to the extent permitted by law, at the
            interest rates on these Class A Notes from that preceding
            Distribution Date to the current Distribution Date.

     "Class A Note Principal Shortfall" means, as of the close of any
Distribution Date, the excess of:

     (i)    the Class A Noteholders' Principal Distribution Amount on that
            Distribution Date, over

     (ii)   the amount of principal actually distributed or allocated to the
            Class A Noteholders on that Distribution Date.

     "Class A Noteholders' Distribution Amount" means, for any Distribution
Date, the sum of the Class A Noteholders' Interest Distribution Amount and the
Class A Noteholders' Principal Distribution Amount on that Distribution Date.

     "Class A Noteholders' Interest Distribution Amount" means, for any
Distribution Date, the sum of:

     (i)    the amount of interest accrued at the Class A Note interest rates
            for the related Accrual Period with respect to all Series of Class A
            Notes with a Distribution Date on this Distribution Date on the
            aggregate Outstanding principal balances of these Series of Class A
            Notes on the applicable immediately preceding Distribution Date(s)
            after giving effect to all principal distributions to Class A
            Noteholders on preceding Distribution Dates or, in the case of the
            first Distribution Date for these Series of Class A Notes, on the
            Closing Date, and

     (ii)   the Class A Note Interest Shortfall on that Distribution Date.

     "Class A Noteholders' Principal Distribution Amount" means:

     (i)    for any Distribution Date occurring while any LIBOR Notes are
            Outstanding, the Principal Distribution Amount on that Distribution
            Date plus the Class A Note Principal Shortfall as of the close of
            the preceding Distribution Date; and

     (ii)   for any Distribution Date occurring while there are no LIBOR Notes
            Outstanding but before the date on which the Class A Auction Rate
            Noteholders have been paid in full, the Principal Distribution
            Amount on that Distribution Date plus the Class A Note Principal
            Shortfall as of the close of the preceding Distribution Date less
            the greatest amount that can be paid as principal on the Class B
            Notes without reducing the Senior Parity Percentage below the
            Required Senior Parity

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<PAGE>

            Percentage or reducing the Parity Percentage below the Required
            Parity Percentage, with those percentages computed assuming that
            immediately prior to the computation, that amount of principal was
            actually made on the Class B Notes;

provided that the Class A Noteholders' Principal Distribution Amount will not
exceed the Outstanding principal balance of the Class A Notes. In addition:

     (1)    on the Stated Maturity of the Series A-1 Notes, the principal
            required to be distributed to Series A-1 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-1 Notes to zero;

     (2)    on the Stated Maturity of the Series A-2 Notes, the principal
            required to be distributed to Series A-2 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-2 Notes to zero;

     (3)    on the Stated Maturity of the Series A-3 Notes, the principal
            required to be distributed to Series A-3 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-3 Notes to zero;

     (4)    on the Stated Maturity of the Series A-4 Notes, the principal
            required to be distributed to Series A-4 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-4 Notes to zero;

     (5)    on the Stated Maturity of the Series A-5 Notes, the principal
            required to be distributed to Series A-5 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-5 Notes to zero;

     (6)    on the Stated Maturity of the Series A-6 Notes, the principal
            required to be distributed to Series A-6 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-6 Notes to zero;

     (7)    on the Stated Maturity of the Series A-7 Notes, the principal
            required to be distributed to Series A-7 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-7 Notes to zero; and

     (8)    on the Stated Maturity of the Series A-8 Notes, the principal
            required to be distributed to Series A-8 Noteholders will include
            the amount required to reduce the Outstanding principal balance of
            the Series A-8 Notes to zero.

     "Class A Notes" means the Series A-1 Notes, the Series A-2 Notes, the
Series A-3 Notes, the Series A-4 Notes, the Series A-5 Notes, the Series A-6
Notes, the Series A-7 Notes, and the Series A-8 Notes.

     "Class B Note Interest Shortfall" means, for any Distribution Date, the
excess of:

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<PAGE>

     (i)    the Class B Noteholders' Interest Distribution Amount on the
            preceding Distribution Date, over

     (ii)   the amount of interest actually distributed to the Class B
            Noteholders on that preceding Distribution Date, plus interest on
            the amount of that excess, to the extent permitted by law, at the
            Class B Note interest rate from that preceding Distribution Date to
            the current Distribution Date.

     "Class B Note Principal Shortfall" means, as of the close of any
Distribution Date, the excess of:

     (i)    the Class B Noteholders' Principal Distribution Amount on that
            Distribution Date, over

     (ii)   the amount of principal actually distributed or allocated to the
            Class B Noteholders on that Distribution Date.

     "Class B Noteholders' Distribution Amount" means, for any Distribution
Date, the sum of the Class B Noteholders' Interest Distribution Amount and the
Class B Noteholders' Principal Distribution Amount on that Distribution Date.

     "Class B Noteholders' Interest Distribution Amount" means, for any
Distribution Date, the sum of:

     (i)    the amount of interest accrued at the Class B Note rate for the
            related Accrual Period on the Outstanding principal balance of the
            Class B Notes on the immediately preceding Distribution Date, after
            giving effect to all principal distributions to Class B Noteholders
            on that preceding Distribution Date, and

     (ii)   the Class B Note Interest Shortfall on that Distribution Date.

     "Class B Noteholders' Principal Distribution Amount" means:

     (i)    for any Distribution Date occurring while there are no LIBOR Notes
            Outstanding but before the date on which the Class A Auction Rate
            Noteholders have been paid in full, the greatest amount that can be
            paid as principal on the Class B Notes without reducing the Senior
            Parity Percentage below the Required Senior Parity Percentage or
            reducing the Parity Percentage below the Required Parity Percentage;
            and

     (ii)   for any Distribution Date occurring after the date on which the
            Class A Noteholders have been paid in full, the Principal
            Distribution Amount on that Distribution Date and the Class B Note
            Principal Shortfall as of the close of the preceding Distribution
            Date;

provided that the Class B Noteholders' Principal Distribution Amount will not
exceed the principal balance of the Class B Notes.

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<PAGE>

     In addition, on the Stated Maturity of the Class B Notes, the principal
required to be distributed to the Class B Noteholders will include the amount
required to reduce the Outstanding principal balance of the Class B Notes to
zero.

     "Class B Notes" means the Series B-1 Notes.

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

     "Closing Date" means October 31, 2003.

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

     "Collection Account" means the Account bearing that name established
pursuant to Section 4.01 of the Indenture, including any Accounts and
subaccounts created therein.

     "Collection Period" means initially the period from the Closing Date
through November 30, 2003. Thereafter, a "Collection Period" means (a) while any
LIBOR Notes are Outstanding, the three-month period ending on the last day of
February, May, August or November, in each case for the Quarterly Distribution
Date in the following month, and (b) after the date on which no LIBOR Notes
remain Outstanding, the period beginning on the first day of each month and
ending on the last day of the same month.

     "Commission" means the Securities and Exchange Commission.

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

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

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

     "Corporate Trust Office" means (i) with respect to the Indenture Trustee,
the principal office of the Indenture Trustee at which at any particular time
its corporate trust business shall be administered, which office at a Closing
Date is located at MD 10AT60, 38 Fountain Square Plaza, Cincinnati, Ohio 45263,
Attention: Corporate Trust Administration (telephone: +1.513.534.0724;
facsimile: +1.513.534.3115) or at such other address as the Indenture Trustee
may designate from time to time by notice to the Noteholders and the Depositor,
or the principal

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<PAGE>

corporate trust office of any successor Indenture Trustee (the address of which
the successor Indenture Trustee will notify the Noteholders and the Depositor)
and (ii) with respect to the Co-Owner Trustee and the Trust Eligible Lender
Trustee, the principal corporate trust offices of the Co-Owner Trustee and the
Trust Eligible Lender Trustee located at MD 10AT60, 38 Fountain Square Plaza,
Cincinnati, Ohio 45263, Attention: Corporate Trust Administration (telephone:
+1.513.534.0724; facsimile: +1.513.534.3115) or at such other address as the
Co-Owner Trustee or the Trust Eligible Lender Trustee may designate by notice to
the Depositor or the principal corporate trust office of any successor Co-Owner
Trustee or Trust Eligible Lender Trustee (the address of which the successor
Co-Owner Trustee or Trust Eligible Lender Trustee will notify the Depositor).

     "Counterparty" means any counterparty under a Derivative Product.

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

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

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

     "Delivery" when used with respect to Trust Account Property means:

     (a)  with respect to bankers' acceptances, commercial paper, negotiable
          certificates of deposit and other obligations that constitute
          instruments and are susceptible of physical delivery ("Physical
          Property"), transfer of possession thereof to the Indenture Trustee,
          endorsed to, or registered in the name of, the Indenture Trustee or
          its nominee or endorsed in blank;

     (b)  with respect to a certificated security:

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

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

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

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

     (c)  with respect to an uncertificated security:

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

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<PAGE>

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

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

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

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

     (e)  with respect to a security entitlement:

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

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

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

          (i)  with respect to a certificated security:

               (A)  the Indenture Trustee acquires possession thereof;

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

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

          (ii) with respect to an uncertificated security:

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

               (B)  another Person (other than a securities intermediary) either
                    becomes the Note Owner thereof on behalf of the Indenture

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<PAGE>

                    Trustee or, having previously become the Note Owner,
                    acknowledges that it holds for the Indenture Trustee;

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

          (i)    "certificated security"

          (ii)   "effective endorsement"

          (iii)  "entitlement holder"

          (iv)   "instrument"

          (v)    "securities account"

          (vi)   "securities entitlement"

          (vii)  "securities intermediary"

          (viii) "uncertificated security"

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

     "Depositor" means Education Funding Capital I, LLC.

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

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

     "Depositor Transfer and Sale Agreement" means the Transfer and Sale
Agreement dated as of October 1, 2003 among the Depositor, the Depositor
Eligible Lender Trustee, the Issuer and the Trust Eligible Lender Trustee.

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

     "Derivative Product" means a written contract or agreement between the
Issuer and a Counterparty:

     (a) under which the Issuer is obligated to pay (whether on a net payment
         basis or otherwise) on one or more scheduled and specified Derivative
         Payment Dates, the

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                                                              Indenture of Trust

<PAGE>

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

     (b)  for which the Issuer's obligation to make Issuer Derivative Payments
          may be secured by a pledge of and lien on the Trust Estate on an equal
          and ratable basis with any class of the Issuer's Outstanding Notes and
          which Issuer Derivative Payments may be equal in priority with any
          priority classification of the Issuer's Outstanding Notes; and

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

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

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

     "Directing Notes" means, so long as any Series of Class A Notes are
Outstanding, the Class A Notes, and thereafter, the Class B Notes.

     "Distribution Account" means the Account bearing that name established
pursuant to Section 4.01 of the Indenture, including any Subaccounts created
therein.

     "Distribution Dates" with respect to the LIBOR Notes means each Quarterly
Distribution Date, and with respect to the Auction Rate Notes means each Auction
Rate Distribution Date, and means, for any Note, its Stated Maturity or the date
of any other regularly scheduled principal payment with respect thereto.

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

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<PAGE>

     "Eligible Investments" means book-entry securities, negotiable instruments
or securities denominated in United States dollars and represented by
instruments in bearer or registered form that evidence:

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

          (b) demand deposits, time deposits or certificates of deposit of any
     depository institution or trust company incorporated under the laws of the
     United States of America or any State (or any domestic branch of a foreign
     bank) and subject to supervision and examination by federal or state
     banking or depository institution authorities (including depository
     receipts issued by any such institution or trust company as custodian with
     respect to any obligation referred to in clause (a) above or portion of
     such obligation for the benefit of the holders of such depository
     receipts); provided, however, that at the time of the investment or
     contractual commitment to invest therein (which shall be deemed to be made
     again each time funds are reinvested following each Distribution Date), the
     commercial paper or other short-term senior unsecured debt obligations
     (other than such obligations the rating of which is based on the credit of
     a Person other than such depository institution or trust company) thereof
     shall have a rating of A-1+ from S&P and a credit rating from each of the
     other Rating Agencies in the highest short-term and long-term investment
     category granted thereby;

          (c) commercial paper having, at the time of the investment or
     contractual commitment to invest therein, a rating of A-1+ from S&P and a
     rating from each of the other Rating Agencies in the highest short-term
     investment category granted thereby, and, if the commercial paper matures
     in more than 30 days, the issuer of which commercial paper having a
     long-term unsecured debt rating from Moody's of A1 (for commercial paper
     maturing in 31 to 90 days), Aa3 (for commercial paper maturing in 91 to 180
     days), or Aaa (for commercial paper maturing in more than 180 days);

          (d) investments in money market funds having a rating of A-1+ from S&P
     and a rating from Moody's and each of the other Rating Agencies rating such
     fund, in the highest investment category granted by such Rating Agency
     applicable to money market funds (including funds for which the Indenture
     Trustee, the Master Servicer or the Trust Eligible Lender Trustee or any of
     their respective Affiliates is investment manager or advisor);

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

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

                                      A-14
                                                              Indenture of Trust

<PAGE>

          (g) any other investment upon receipt of a Rating Confirmation or any
     other investment made in connection with the original issuance of Notes in
     respect of which issuance a Rating Confirmation has been obtained.

No obligation having an "r" highlighter affixed to its rating shall be
considered an Eligible Investment. Eligible Investments shall not include
interest-only securities or securities purchased at a premium over par.

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

     "Eligible Lender Trust Agreements" means collectively the Seller Eligible
Lender Trust Agreement, the Depositor Eligible Lender Trust Agreement and the
Trust Eligible Lender Trust Agreement.

     "Event of Bankruptcy" means (a) the Issuer shall have commenced a voluntary
case or other proceeding seeking liquidation, reorganization, or other relief
with respect to itself or its debts under any bankruptcy, insolvency, or other
similar law now or hereafter in effect or seeking the appointment of a trustee,
receiver, liquidator, custodian, or other similar official of it or any
substantial part of its property, or shall have made a general assignment for
the benefit of creditors, or shall have declared a moratorium with respect to
its debts or shall have failed generally to pay its debts as they become due, or
shall have taken any action to authorize any of the foregoing; or (b) an
involuntary case or other proceeding shall have been commenced against the
Issuer seeking liquidation, reorganization, or other relief with respect to it
or its debts under any bankruptcy, insolvency or other similar law now or
hereafter in effect or seeking the appointment of a trustee, receiver,
liquidator, custodian, or other similar official of it or any substantial part
of its property, provided such action or proceeding is not dismissed within 60
days.

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

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

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

     "FFELP Loan" means a Student Loan made under the FFEL Program.

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                                                              Indenture of Trust

<PAGE>

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

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

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

     "Fitch" means Fitch Ratings or any successor thereto.

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

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

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

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

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

     "Indenture" means the Indenture of Trust dated as of October 1, 2003 among
the Issuer, the Trust Eligible Lender Trustee and the Indenture Trustee, as
amended and supplemented from time to time.

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

                                      A-16
                                                              Indenture of Trust

<PAGE>

     "Independent" means, when used with respect to any specified Person, that
the Person (a) is in fact independent of the Issuer, any other obligor upon the
Notes, the Seller and any Affiliate of any of the foregoing Persons, (b) does
not have any direct financial interest or any material indirect financial
interest in the Issuer, any such other obligor, the Seller or any Affiliate of
any of the foregoing Persons and (c) is not connected with the Issuer, any such
other obligor, the Seller or any Affiliate of any of the foregoing Persons as an
officer, employee, promoter, underwriter, trustee, partner, director or person
performing similar functions.

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

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

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

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

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

     "Issuer Derivative Payments" means collectively Scheduled Issuer Derivative
Payments, Specified Issuer Termination Payments and Other Issuer Termination
Payments.

     "Issuer Order" and "Issuer Request" means a written order or request signed
in the name of the Issuer by any one of its Authorized Officers and delivered to
the Indenture Trustee.

     "LIBOR Notes" means the Series A-1 Notes, the Series A-2 Notes, and the
Series A-3 Notes.

     "Market Agent Agreement" shall have the meaning given to that term in
Appendix B.

     "Master Servicer" means Education Lending Services, Inc., in its capacity
as servicer of the Financed Student Loans, or any permitted successor Master
Servicer, under the Master Servicing Agreement.

     "Master Servicer Default" means an event specified as such in the Master
Servicing Agreement.

                                      A-17
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<PAGE>

     "Master Servicing Agreement" means, collectively, (i) the Master Servicing
Agreement dated as of October 1, 2003, as supplemented and amended from time to
time, among the Issuer, the Trust Eligible Lender Trustee, the Master Servicer
and the Indenture Trustee, and (ii) the Subservicing Agreement.

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

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

     "Minimum Purchase Amount" means an amount sufficient to:

     (i)    reduce the outstanding principal amount of each Series of Notes then
            outstanding on the related Distribution Date to zero;

     (ii)   pay to Noteholders the interest payable on the related Distribution
            Date;

     (iii)  pay all remaining Issuer Derivative Payments then due or to become
            due under Derivative Products secured on a parity with any Series of
            the Class A Notes or the Class B Notes; and

     (iv)   in the case of Auction Rate Notes, pay any Carry-over Amounts and
            interest on Carry-over Amounts.

     "Monthly Allocation Date" means the 15/th/ day of each calendar month.

     "Monthly Expense Payment Date" means the 15/th/ day of each calendar month.

     "Monthly Issuer Fees" means the fees of each Subservicer, the Indenture
Trustee, the Trust Eligible Lender Trustee, the Owner Trustee, the Auction
Agent, each Broker-Dealer, the Master Servicer and the Administrator.

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

     "Note Counsel" means counsel to the Issuer.

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

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

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                                                              Indenture of Trust

<PAGE>

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

     "Notes" means, collectively, the Class A Notes and the Class B Notes.

     "Obligations" means Senior Obligations and Subordinate Obligations.

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

     "Other Issuer Termination Payments" with respect to a Derivative Product
means one or more payments required to be made by the Issuer to the Counterparty
thereunder in respect of early termination of the Derivative Product; excluding,
however, Specified Issuer Termination Payments.

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

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

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

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

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

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

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

                                      A-19
                                                              Indenture of Trust

<PAGE>

     "Pool Balance" for any date means the aggregate principal balance of the
Financed Student Loans on that date, including accrued interest that is expected
to be capitalized, as reduced by:

     (i)    all payments received by the Issuer through that date from
            borrowers, the Guarantee Agencies and the Department;

     (ii)   all amounts received by the Issuer through that date from purchases
            of the Financed Student Loans by the Seller, the Depositor or the
            Master Servicer;

     (iii)  all liquidation proceeds and Realized Losses on the Financed Student
            Loans liquidated through that date;

     (iv)   the amount of any adjustments to balances of the Financed Student
            Loans that the Master Servicer makes under the Master Servicing
            Agreement through that date; and

     (v)    the amount by which Guarantor reimbursements of principal on
            defaulted Financed Student Loans through that date are reduced from
            100% to 98%, or other applicable percentage, as required by the risk
            sharing provisions of the Act.

     "Pool Factor" with respect to a Series of Notes means, as of any date, a
seven-digit decimal figure equal to the Outstanding Amount of that Series of
Notes as of the close of business on such date divided by the initial
Outstanding Amount of that Series of Notes. The Pool Factor for each Series of
Notes will be 1.0000000 as of the Closing Date; thereafter, the Pool Factor will
decline to reflect reductions in the Outstanding Amount of that Series of Notes.

     "Principal Distribution Amount" means:

     (i)    as to the initial Distribution Date, the amount by which the initial
            Pool Balance exceeds the Pool Balance on that Distribution Date plus
            any amounts transferred from the Acquisition Account to the
            Collection Account during the initial Collection Period, and

     (ii)   as to each subsequent Distribution Date, the amount by which the
            Pool Balance for the preceding Distribution Date exceeds the Pool
            Balance on that Distribution Date.

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

     "Program Expenses" means (a) the fees and expenses of the Indenture
Trustee, the Owner Trustee and the Co-Owner Trustee; (b) the fees and expenses
of any auction agent, any market agent, any calculation agent and any
Broker-Dealer with respect to Auction Rate Notes; (c) the fees and expenses of
any remarketing agent then acting under a Indenture with respect to variable
rate Notes; (d) the fees and expenses due to any credit provider of any Notes
for which a credit facility or liquidity facility is in place; (e) the fees of
the Administrator, the Master

                                      A-20
                                                              Indenture of Trust

<PAGE>

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

     "Quarterly Distribution Date" means the 15/th/ day of each March, June,
September and December, beginning December 15, 2003; provided, however, if any
March 15/th/, June 15/th/, September 15/th/ or December 15/th/ is not a Business
Day, the Quarterly Distribution Date shall be the next Business Day.

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

     "Rating Agency" means Fitch, Moody's and S&P. If no such organization or
successor is any longer in existence, "Rating Agency" shall be a nationally
recognized statistical rating organization or other comparable Person designated
by the Seller, notice of which designation shall be given to the Indenture
Trustee, the Trust Eligible Lender Trustee and the Master Servicer.

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

     "Rating Confirmation" means, as of any date, (a) a letter from each Rating
Agency then providing a Rating for any of the Notes, confirming that the action
proposed to be taken by the Issuer will not, in and of itself, result in a
downgrade of any of the Ratings then applicable to the Notes, or cause any
Rating Agency to suspend or withdraw the Ratings then applicable to the Notes,
and (b) while any LIBOR Notes are Outstanding, a letter from each Rating Agency
which rated the Notes on the Closing Date, confirming that the action proposed
to be taken by the Issuer will not, in and of itself, result in any of the
Ratings of the Outstanding Notes from that Rating Agency being reduced below any
of that Rating Agency's Ratings of the Notes on the Closing Date or cause such
Rating Agency to suspend or withdraw any of its Ratings of the Outstanding
Notes.

     "Realized Loss" means the excess of the principal balance, including any
interest that had been or had been expected to be capitalized, of any liquidated
Financed Student Loan over

                                      A-21
                                                              Indenture of Trust

<PAGE>

liquidation proceeds for a Financed Student Loan to the extent allocated to
principal, including any interest that had been or had been expected to be
capitalized.

     "Record Date" means:

     (a) for the LIBOR Notes, the day before the related Distribution Date; and

     (b) for the Auction Rate Notes,

         (i)   for payments of interest at the applicable interest rate and for
               payments of principal, two Business Days before the related
               Distribution Date, and

         (ii)   for payments of Carry-over Amounts and interest accrued thereon,
                the record date relating to the Distribution Date for which the
                Carry-over Amount accrued.

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

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

     "Required Parity Percentage" means 100.5%; provided, however, that the
Required Parity Percentage may be reduced upon receipt of a Rating Confirmation.

     "Required Senior Parity Percentage" means 105.0%; provided, however, that
the Required Senior Parity Percentage may be reduced upon receipt of a Rating
Confirmation.

     "Reserve Account" means the Account bearing that name established pursuant
to Section 4.01 of the Indenture, including any Subaccounts created therein.

     "Reserve Account Requirement" for any Distribution Date means the greater
of (a) 1.0% of the Outstanding balance of the Notes, and (b) $500,000; provided,
however, that if the Senior Parity Percentage is at least 105.0% and the Parity
Percentage is at least 100.5% on any Distribution Date, the Reserve Account
Requirement for such Distribution Date shall be equal to the greater of (c)
0.75% of the Outstanding balance of all of the Notes, and (d) $500,000. In no
event will the Reserve Account Requirement exceed the Outstanding balance of all
of the Notes.

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

                                      A-22
                                                              Indenture of Trust

<PAGE>

administration of the Indenture, and also, with respect to a particular matter,
any other officer, to whom such matter is referred because of such officer's
knowledge of and familiarity with the particular subject.

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

     "S&P" means Standard & Poor's, a division of the McGraw-Hill Companies.

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

     "Scheduled Issuer Derivative Payments" with respect to a Derivative Product
means one or more payments required to be made by or on behalf of the Issuer to
the Counterparty thereunder on scheduled and specified Derivative Payment Dates.

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

     "Securities Act" means the federal Securities Act of 1933, as amended.

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

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

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

     "Seller Eligible Lender Trust Agreement" means the Amended and Restated
Eligible Lender Trust Agreement dated as of July 22, 2002 between the Seller and
the Seller Eligible Lender Trustee.

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

                                      A-23
                                                              Indenture of Trust

<PAGE>

     "Seller Transfer and Sale Agreement" means Transfer and Sale Agreement
dated as of October 1, 2003 among the Seller, the Seller Eligible Lender
Trustee, the Depositor and the Depositor Eligible Lender Trustee.

     "Senior Obligations" means Class A Notes and any Derivative Product, the
priority of payment of which is equal with that of Class A Notes.

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

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

     "Series A-1 Notes" means the $77,500,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-1.

     "Series A-2 Notes" means the $118,500,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-2.

     "Series A-3 Notes" means the $319,000,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-3.

     "Series A-4 Notes" means the $100,000,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-4.

     "Series A-5 Notes" means the $83,750,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-5.

     "Series A-6 Notes" means the $83,750,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-6.

     "Series A-7 Notes" means the $83,750,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-7.

     "Series A-8 Notes" means the $83,750,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series A-8.

     "Series B-1 Notes" means the $50,000,000 Education Funding Capital
Trust-III, Education Loan Backed Notes, Series B-1.

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

                                      A-24
                                                              Indenture of Trust

<PAGE>

     "Special Record Date" means the date established by the Indenture Trustee
pursuant to Section 1.01 of the Indenture.

     "Specified Issuer Termination Payments" with respect to a Derivative
Product means one or more payments required to be made by the Issuer to the
Counterparty thereunder in respect of early termination of the Derivative
Product upon the occurrence of certain events specified in the Schedule to the
Derivative Product.

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

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

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

     "Subaccount" means any of the subaccounts that may be created and
established within any Account pursuant to Section 4.01 of the Indenture.

     "Subordinate Obligations" means Class B Notes and any Derivative Product,
the priority of payment of which is equal with that of Class B Notes.

     "Subservicer" means each of Great Lakes Educational Loan Services, Inc. and
ACS Education Services, Inc., in its capacity as a subservicer of the Financed
Student Loans, and/or any other permitted subservicer, under the Master
Servicing Agreement.

     "Subservicing Agreement" means collectively the Student Loan Origination
and Servicing Agreement dated as of October 1, 2003 among Great Lakes
Educational Loan Services, Inc., the Trust Eligible Lender Trustee and the
Master Servicer, and the Federal FFEL Servicing Agreement dated as of October 1,
2002, as amended by First Amendment to Federal FFEL Servicing Agreement dated as
of October 1, 2003, among ACS Education Services, Inc. ("ACS"), the Master
Servicer and Fifth Third Bank, as Eligible Lender Trustee for the Master
Servicer, as supplemented by the Affiliate Servicing Addendum dated as of
October 1, 2003 among ACS, the Master Servicer, Fifth Third Bank, as Eligible
Lender Trustee for the Master Servicer, the Trust and the Trust Eligible Lender
Trustee.

     "Supplemental Indenture" means (i) the First Supplemental Indenture of
Trust dated as of October 1, 2003 among the Issuer, the Indenture Trustee, and
the Trust Eligible Lender Trustee, and (ii) each other agreement supplemental to
the Indenture, executed pursuant to Article VII of the Indenture.

     "Transfer and Sale Agreements" means collectively the Seller Transfer and
Sale Agreement and the Depositor Transfer and Sale Agreement.

                                      A-25
                                                              Indenture of Trust

<PAGE>

     "Treasury Regulations" means regulations, including proposed or temporary
regulations, promulgated under the Code. References in any document or
instrument to specific provisions of proposed or temporary regulations shall
include analogous provisions of final Treasury Regulations or other successor
Treasury Regulations.

     "Trust" means Education Funding Capital Trust-III, formed pursuant to the
Trust Agreement.

     "Trust Accounts" shall have the meaning given such term in Section 4.01 of
the Indenture.

     "Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the form of
deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), including the Reserve Account, the Distribution
Account, the Capitalized Interest Account, the Acquisition Account and the
Collection Account and all proceeds of the foregoing.

     "Trust Agreement" means the Trust Agreement dated as of September 3, 2003
among the Depositor, the Owner Trustee and the Co-Owner Trustee, as amended and
restated in its entirety by the Amended and Restated Trust Agreement dated as of
October 1, 2003 among the Depositor, the Owner Trustee and the Co-Owner Trustee,
and acknowledged and agreed to by the Trust Eligible Lender Trustee, as the same
may be further amended from time to time.

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

     "Trust Eligible Lender Trust Agreement" means the Eligible Lender Trust
Agreement dated as of October 1, 2003 between the Issuer and the Trust Eligible
Lender Trustee.

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

     "Trust Estate" means all right, title and interest of the Trust (or the
Co-Owner Trustee or Trust Eligible Lender Trustee on behalf of the Trust) in and
to the property and rights assigned to the Trust pursuant to Article I of the
Depositor Transfer and Sale Agreement, all funds on deposit from time to time in
the Trust Accounts and all other property of the Trust from time to time,
including any rights of the Trust pursuant to the Depositor Transfer and Sale
Agreement, the Master Servicing Agreement and the Administration Agreement.

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

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

                                      A-26
                                                              Indenture of Trust

<PAGE>

     "Underwriters" means Citigroup Global Markets Inc., William R. Hough & Co.
and Fifth Third Securities, Inc.

     "Underwriting Agreement" means the Underwriting Agreement dated October 27,
2003 between the Issuer and Citigroup Global Markets Inc., as representative of
the Underwriters.

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

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

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

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

     (d) as to investments the bid and asked prices of which are published on a
         regular basis in The Wall Street Journal (or, if not there, then in The
         New York Times), the average of the bid and asked prices for such
         investments so published on or most recently prior to such time of
         determination; and

     (e) as to investments the bid and asked prices of which are not published
         on a regular basis in The Wall Street Journal or The New York Times:
         (i) the lower of the bid prices at such time of determination for such
         investments by any two nationally recognized government securities
         dealers (selected by the Issuer in its absolute discretion) at the time
         making a market in such investments or (ii) the bid price published by
         a nationally recognized pricing service.

                                      A-27
                                                              Indenture of Trust

<PAGE>
                                   Appendix B

                         Certain Terms and Provisions of
                             the Auction Rate Notes

                                    Article I

                                   Definitions

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

     "All Hold Rate" means the Applicable LIBOR Rate less 0.20%; 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" means the implementation of the Auction Procedures on an Auction
Date.

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

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

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

     "Auction Date" means, initially, December 8, 2003 with respect to the
Series A-4 Notes, November 24, 2003 with respect to the Series A-5 Notes,
December 1, 2003 with respect to the Series A-6 Notes, December 8, 2003 with
respect to the Series A-7 Notes, December 15, 2003 with respect to the Series
A-8 Notes and December 8, 2003 with respect to the Series B-1 Notes, and
thereafter, the Business Day immediately preceding the first day of each Auction
Period for each respective Series, other than:

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

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

                                      B-1
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

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

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

     "Book-entry Form" or "Book-entry System" means a form or system under which
(a) the beneficial right to principal and interest may be transferred only
through a book entry, (b) physical securities in registered form are issued only
to a Securities Depository or its nominee as Noteholder, with the securities
"immobilized" to the custody of the Securities

                                      B-2
                                                              Indenture of Trust

<PAGE>

Depository, and (c) the book entry is the record that identifies the owners of
beneficial interests in that principal and interest.

     "Broker-Dealers" means William R. Hough & Co. (with respect to the Series
A-4 Notes), and Citigroup Global Markets Inc. (with respect to the Series A-5
Notes, the Series A-6 Notes, the Series A-7 Notes, the Series A-8 Notes and the
Series B-1 Notes), and any other broker or dealer (each as defined in the
Securities Exchange Act of 1934, as amended), commercial bank or other entity
permitted by law to perform the functions required of a Broker-Dealer set forth
in the Auction Procedures that (a) is a Participant (or an affiliate of a
Participant), (b) has been appointed as such by the Issuer pursuant to Section
2.02(f) of this Appendix B, and (c) has entered into a Broker-Dealer Agreement
that is in effect on the date of reference.

     "Broker-Dealer Agreements" means the agreements between the Auction Agent
and the Broker-Dealers, and approved by the Issuer, pursuant to which the
Broker-Dealers agree to participate in Auctions as set forth in the Auction
Procedures, as from time to time amended or supplemented. The Broker-Dealer
Agreements shall be in substantially the form of each Broker-Dealer Agreement
dated as of October 1, 2003, among the Issuer, the Auction Agent, and each
respective Broker-Dealer.

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

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

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

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

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

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(b)  plus all accrued Interest Benefit Payments and Special Allowance Payments
applicable to such Financed Student Loan during such calendar quarter expressed
as a percentage per annum.

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

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

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

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

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

     "Initial Payment Dates" means, with respect to the Series A-4 Notes,
December 9, 2003; with respect to the Series A-5 Notes, November 25, 2003; with
respect to the Series A-6 Notes, December 2, 2003; with respect to the Series
A-7 Notes, December 9, 2003; with respect to the Series A-8 Notes, December 16,
2003; and with respect to the Series B-1 Notes, December 9, 2003.

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

     "Initial Rate" means 1.130% for the Series A-4 Notes, 1.130% for the Series
A-5 Notes, 1.130% for the Series A-6 Notes, 1.130% for the Series A-7 Notes,
1.135% for the Series A-8 Notes, and 1.250% for the Series B-1 Notes.

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     "Initial Rate Adjustment Date" means, with respect to the Series A-4 Notes,
December 9, 2003; with respect to the Series A-5 Notes, November 25, 2003; with
respect to the Series A-6 Notes, December 2, 2003; with respect to the Series
A-7 Notes, December 9, 2003; with respect to the Series A-8 Notes, December 16,
2003; and with respect to the Series B-1 Notes, December 9, 2003.

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

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

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

     "Market Agent" means Citigroup Global Markets Inc.

     "Market Agent Agreement" means the Market Agent Agreement dated as of
October 1, 2003 among the Market Agent, the Issuer and the Indenture Trustee, as
the same may be amended from time to time.

     "Maximum Rate" means the least of (a) either (i) the Applicable LIBOR Rate
plus 1.50% (if the ratings assigned by Fitch, Moody's and S&P to the Auction
Rate Notes are "AA-", "Aa3" and "AA-", respectively, or better) or (ii) the
Applicable LIBOR Rate plus 2.50% (if any one of the ratings assigned by Fitch,
Moody's and S&P to the Auction Rate Notes is less than "AA-", "Aa3" and "AA-",
respectively, and greater than or equal to "A-", "A" and "A", respectively), or
(iii) the Applicable LIBOR Rate plus 3.50% (if any one of the ratings assigned
by Fitch, Moody's and S&P to the Auction Rate Notes is less than "A-", "A" and
"A-", respectively), and (b) the highest rate the Issuer may legally pay, from
time to time, as interest on the Auction Rate Notes. For purposes of the Auction
Agent and the Auction Procedures, the ratings referred to in this definition
shall be the last ratings of which the Auction Agent has been given written
notice pursuant to the Auction Agent Agreement.

     "Net Loan Rate" means, with respect to any Interest Period applicable to
the Auction Rate Notes, the rate of interest per annum (rounded to the next
highest one-hundredth of one percent) equal to (a) the weighted average
Effective Interest Rate of the Financed Student Loans for the calendar quarter
immediately preceding such Interest Period, as determined by the Administrator
on the last day of such calendar quarter, less (b) the sum of (i) the Program
Expense Percentage, as determined by the Administrator on the last day of each
calendar quarter and (ii) net losses realized on the Financed Student Loans
during the calendar quarter immediately preceding such Interest Period, as
determined by the Administrator on the last day of such calendar quarter,
expressed as a percentage of the principal balance of the Financed

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Student Loans outstanding on the last day of such calendar quarter. In making
the determinations in (a) and (b) of this definition of "Net Loan Rate," the
Administrator shall take into account as an increase to such Net Loan Rate the
receipt of any Counterparty Derivative Payment and as a decrease to such Net
Loan Rate any Issuer Derivative Payment. The determinations made by the
Administrator in (a) and (b) of this definition of "Net Loan Rate" shall be
given in writing to the Auction Agent, the Indenture Trustee and the
Broker-Dealers immediately upon their respective calculation dates.

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

     "One-Month LIBOR", "Two-Month LIBOR", "Three-Month LIBOR", "Six-Month
LIBOR" or "One-Year LIBOR" means the rate per annum for London Interbank Offered
Rates on U.S. dollar deposits as it appears on Telerate Page 3750 as of 11:00
a.m., London Time for the Applicable LIBOR Rate, as determined by the Auction
Agent or Indenture Trustee, as applicable, on the related LIBOR Determination
Date. If such a day is not a business day in London, the most recently fixed
London Interbank Offered Rates on U.S. dollar deposits for the Applicable LIBOR
Rate shall be used. The LIBOR Determination Date will be the second business day
before the beginning of each Accrual Period. 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 relevant 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 four major banks selected by the Auction Agent or the
Indenture Trustee. The Auction Agent or the Indenture Trustee will require the
principal London office of each bank to provide a quotation of its rate. If the
banks provide at least two quotations, the rate for that day will be the
arithmetic mean of the quotations. If the 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 Auction Agent or the
Indenture Trustee, 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 relevant 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, the Applicable LIBOR Rate in effect for the applicable Accrual
Period will be the Applicable LIBOR Rate in effect for the previous Accrual
Period. All percentages resulting from such calculations shall be rounded
upwards, if necessary, to the nearest one-hundredth of one percent.

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

     "Payment Date" means, initially with respect to each Series of the Auction
Rate Notes, the applicable Initial Payment Dates and, thereafter (a) so long as
a Series of the Auction Rate Notes bears interest at an Auction Note Interest
Rate for an Interest Period of not greater than 90 days, the Business Day
immediately following the expiration of the related Auction Period thereafter
and (b) if and for so long as a Series of Auction Rate Notes bears interest at
an Auction Note Interest Rate for an Interest Period of greater than 90 days,
(i) the 15th day of each March, June, September and December unless any March
15, June 15, September 15 or December 15 is not a Business Day, then the Payment
Date will be the next Business Day, and (ii) the Business

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Day immediately following the expiration of the Auction Period for that Series
of Auction Rate Notes.

     "Payment Default" means, 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" means 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" means, the percentage that all Program
Expenses (other than Consolidation Loan rebate fees) estimated for the next 12
months represent of the outstanding principal balance of the Financed Student
Loans, which as of the Closing Date is 0.50%, and which the Administrator shall
calculate on the last day of each calendar quarter. Any adjustment in the
Program Expense Percentage shall be effective beginning on the first Interest
Rate Determination Date following each such calculation.

     "Regular Record Date" means, with respect to each Payment Date, the
Business Day immediately preceding such Payment Date.

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

     "Submission Deadline" means 1:00 p.m., eastern time, on any Auction Date or
such other time on any Auction Date by which the Broker-Dealers are required to
submit Orders to the Auction Agent as specified by the Auction Agent from time
to time.

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

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

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

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

     "Substitute Auction Agent" means the Person with whom the Issuer and the
Indenture Trustee enter into a Substitute Auction Agent Agreement.

     "Substitute Auction Agent Agreement" means an auction agent agreement
containing terms substantially similar to the terms of the Initial Auction Agent
Agreement, whereby a Person having the qualifications required by Section
2.02(e) of this Appendix B agrees with the

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<PAGE>

Indenture Trustee and the Issuer to perform the duties of the Auction Agent
under this Appendix B.

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

                                   Article II

                               Terms and Issuance

     Section 2.01 Auction Rate and Carry-over Amounts. During the Initial
Period, each Series of Auction Rate Notes shall bear interest at the Initial
Rate for such Series. Thereafter, and except with respect to an Auction Period
Adjustment, the Auction Rate Notes shall bear interest at an Auction Note
Interest Rate based on a 28-day Auction Period for the Auction Rate Notes, as
determined pursuant to this Section 2.01 and Section 2.02 of this Appendix B.

     For the Auction Rate Notes during the Initial Period and each Auction
Period thereafter, interest at the applicable Auction Note Interest Rate shall
accrue daily and shall be computed for the actual number of days elapsed on the
basis of a year consisting of 360 days.

     The Auction Note Interest Rate to be borne by the Auction Rate Notes after
such Initial Period for each Auction Period until an Auction Period Adjustment,
if any, shall be determined as described below. Each such Auction Period after
the Initial Period shall commence on and include the day following the
expiration of the immediately preceding Auction Period and terminate on and
include (i) the day preceding the first Business Day of the following fourth
week in the case of the Series A-4 Notes and the Series A-5 Notes, and (ii) the
fourth Business Day of the following fourth week in the case of the Series A-6
Notes, the Series A-7 Notes, the Series A-8 Notes and the Series B-1 Notes;
provided, however, that in the case of the Auction Period that immediately
follows the Initial Period for the Auction Rate Notes, such Auction Period shall
commence on the Initial Rate Adjustment Date. The Auction Note Interest Rate of
the Auction Rate Notes for each Auction Period shall be the Auction Rate in
effect for such Auction Period as determined in accordance with Section 2.02(a)
of this Appendix B; provided that, if on any Interest Rate Determination Date,
an Auction is not held for any reason, the following Business Day shall be
considered the Interest Rate Determination Date and an Auction is to be held on
such date. If an Auction is not held for any reason on such date, then the
Auction Note Interest Rate on such Auction Rate Notes for the next succeeding
Auction Period shall be the applicable Cap Rate.

     Notwithstanding the foregoing:

          (a)  if the ownership of an Auction Rate Note is no longer maintained
     in Book-entry Form, the Auction Note Interest Rate on the Auction Rate
     Notes for any Interest Period commencing after the delivery of certificates
     representing Auction Rate Notes pursuant to the Indenture shall equal the
     Cap Rate; or

          (b)  if a Payment Default shall have occurred, the Auction Note
     Interest Rate on the Auction Rate Notes for the Interest Period commencing
     on or immediately after

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     such Payment Default, and for each Interest Period thereafter, to and
     including the Interest Period, if any, during which, or commencing less
     than two Business Days after, such Payment Default is cured, shall equal
     the applicable Non-Payment Rate on the first day of each such Interest
     Period.

     In accordance with Section 2.02(a)(iii)(B) and (C) of this Appendix B, the
Auction Agent shall promptly give written notice to the Indenture Trustee and
the Issuer of each Auction Note Interest Rate (unless the Auction Note Interest
Rate is the applicable Non-Payment Rate) and the Maximum Rate when such rate is
not the Auction Note Interest Rate, applicable to the Auction Rate Notes. The
Indenture Trustee shall, upon request, notify the Noteholders and the Issuer of
Auction Rate Notes of the applicable Auction Note Interest Rate applicable to
such Auction Rate Notes for each Auction Period not later than the third
Business Day of such Auction Period. Notwithstanding any other provision of the
Auction Rate Notes or the Indenture and except for the occurrence of a Payment
Default, interest payable on the Auction Rate Notes for an Auction Period shall
never exceed for such Auction Period the amount of interest payable at the
applicable Maximum Rate in effect for such Auction Period.

     If the Auction Rate for the Auction Rate Notes is greater than the Net Loan
Rate, then the Auction Note Interest Rate applicable to such Auction Rate Notes
for that Interest Period will be the Net Loan Rate and the Issuer shall
determine the Carry-over Amount, if any, with respect to such Auction Rate Notes
for such Interest Period.

     Such Carry-over Amount shall bear interest calculated at a rate equal to
One-Month LIBOR (as determined by the Indenture Trustee) from the Payment Date
for the Interest Period with respect to which such Carry-over Amount was
calculated, until paid. Any payment in respect of Carry-over Amount shall be
applied, first, to any accrued interest payable thereon and, second, in
reduction of such Carry-over Amount. For purposes of the Indenture and this
Appendix B, any reference to "principal" or "interest" herein shall not include
within the meaning of such words Carry-over Amount or any interest accrued on
any such Carry-over Amount. Such Carry-over Amount shall be separately
calculated for each Auction Rate Note by the Issuer during such Interest Period
in sufficient time for the Indenture Trustee to give notice to each Noteholder
of such Carry-over Amount as required in the next succeeding sentence. Not less
than four days before the Payment Date for an Interest Period with respect to
which such Carry-over Amount has been calculated by the Issuer, the Indenture
Trustee shall give written notice to each Noteholder, the Auction Agent and the
Issuer, in the form provided by the Issuer, of the Carry-over Amount applicable
to each Auction Rate Note, which written notice may accompany the payment of
interest made to the Noteholder on such Payment Date. Such notice shall state,
in addition to such Carry-over Amount, that, unless and until an Auction Rate
Note has been redeemed (other than by optional redemption), after which all
accrued Carry-over Amounts (and all accrued interest thereon) that remains
unpaid shall be canceled and no Carry-over Amount (and interest accrued thereon)
shall be paid with respect to such Auction Rate Note, (a) the Carry-over Amount
(and interest accrued thereon calculated at a rate equal to One-Month LIBOR)
shall be paid by the Indenture Trustee pursuant to an Issuer Order on an Auction
Rate Note on the earliest of (i) the date of defeasance of any of the Auction
Rate Notes or (ii) the first occurring Payment Date with respect to the Auction
Rate Note (or on the date of any such optional redemption) if and to the extent
that (A) the Eligible Carry-over Make-up Amount with

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<PAGE>

respect to such subsequent Interest Period is greater than zero, and (B) moneys
are available pursuant to the terms of the Indenture in an amount sufficient to
pay all or a portion of such Carry-over Amount (and interest accrued thereon),
and (b) interest shall accrue on the Carry-over Amount at a rate equal to
One-Month LIBOR until such Carry-over Amount is paid in full or is cancelled.

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

     The Payment Date or other date on which such Carry-over Amount (or any
interest accrued thereon) for Auction Rate Notes shall be paid shall be
determined by the Indenture Trustee in accordance with the provisions of the
immediately preceding paragraph and the Indenture, and the Indenture Trustee
shall make payment of the Carry-over Amount (and any interest accrued thereon)
in the same manner as, and from the same Trust Account from which, it pays
interest on the Auction Rate Notes on a Payment Date. Any payment of Carry-over
Amounts (and interest accrued thereon) shall reduce the amount of Eligible
Carry-over Make-up Amount.

     In the event that the Auction Agent no longer determines, or fails to
determine, when required, the Auction Note Interest Rate with respect to Auction
Rate Notes, or, if for any reason such manner of determination shall be held to
be invalid or unenforceable, the Auction Note Interest Rate for the next
succeeding Interest Period, which Interest Period shall be an Auction

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Period, for Auction Rate Notes shall be the applicable Cap Rate as determined by
the Auction Agent for such next succeeding Auction Period, and if the Auction
Agent shall fail or refuse to determine the Cap Rate, the Cap Rate shall be
determined by the securities dealer appointed by the Issuer capable of making
such a determination in accordance with the provisions of this Appendix B and
written notice of such determination shall be given by such securities dealer to
the Indenture Trustee.

     Section 2.02 Auction Rate.
                  ------------

     (a) Determining the Auction Rate. By purchasing Auction Rate Notes, whether
in an Auction or otherwise, each purchaser of Auction Rate Notes, or its
Broker-Dealer, must agree and shall be deemed by such purchase to have agreed
(x) to participate in Auctions on the terms described herein, (y) to have its
beneficial ownership of the Auction Rate Notes maintained at all times in
Book-entry Form for the account of its Participant, which in turn will maintain
records of such beneficial ownership, and (z) to authorize such Participant to
disclose to the Auction Agent such information with respect to such beneficial
ownership as the Auction Agent may request.

     So long as the ownership of Auction Rate Notes is maintained in Book-entry
Form by the Securities Depository, an Existing Owner may sell, transfer or
otherwise dispose of Auction Rate Notes only pursuant to a Bid or Sell Order
placed in an Auction or otherwise sell, transfer or dispose of Auction Rate
Notes through a Broker-Dealer; provided that, in the case of all transfers other
than pursuant to Auctions, such Existing Owner, its Broker-Dealer or its
Participant advises the Auction Agent of such transfer.

     Auctions shall be conducted on each Auction Date, if there is an Auction
Agent on such Auction Date, in the following manner:

     (i)  (A)  Prior to the Submission Deadline on each Auction Date;

               (1)  each Existing Owner of Auction Rate Notes may submit to a
          Broker-Dealer by telephone or otherwise any information as to:

                    a. the principal amount of Outstanding Auction Rate Notes,
               if any, owned by such Existing Owner that such Existing Owner
               desires to continue to own without regard to the Auction Note
               Interest Rate for the next succeeding Auction Period;

                    b. the principal amount of Outstanding Auction Rate Notes,
               if any, that such Existing Owner offers to sell if the Auction
               Note Interest Rate for the next succeeding Auction Period shall
               be less than the rate per annum specified by such Existing Owner;
               and/or

                    c. the principal amount of Outstanding Auction Rate Notes,
               if any, owned by such Existing Owner that such Existing Owner
               offers to

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               sell without regard to the Auction Note Interest Rate for the
               next succeeding Auction Period;

               and

               (2)  one or more Broker-Dealers may contact Potential Owners to
          determine the principal amount of Auction Rate Notes that each
          Potential Owner offers to purchase, if the Auction Note Interest Rate
          for the next succeeding Auction Period shall not be less than the rate
          per annum specified by such Potential Owner.

     The statement of an Existing Owner or a Potential Owner referred to in (1)
or (2) of this paragraph (A) is herein referred to as an "Order," and each
Existing Owner and each Potential Owner placing an Order is herein referred to
as a "Bidder"; an Order described in clause (1)a. is herein referred to as a
"Hold Order"; an Order described in clauses (1)b. and (2) is herein referred to
as a "Bid"; and an Order described in clause (1)c. is herein referred to as a
"Sell Order."

          (B)  (1)  Subject to the provisions of Section 2.02(a)(ii) of this
     Appendix B, a Bid by an Existing Owner shall constitute an irrevocable
     offer to sell:

                    a. the principal amount of Outstanding Auction Rate Notes
               specified in such Bid if the Auction Note Interest Rate
               determined as provided in this Section 2.02(a) shall be less than
               the rate specified therein; or

                    b. such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes to be determined as set forth in
               Section 2.02(a)(iv)(A)(4) of this Appendix B, if the Auction Note
               Interest Rate determined as provided in this Section 2.02(a)
               shall be equal to the rate specified therein; or

                    c. such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes to be determined as set forth in
               Section 2.02(a)(iv)(B)(3) of this Appendix B, if the rate
               specified therein shall be higher than the applicable Maximum
               Rate and Sufficient Bids have not been made.

               (2)  Subject to the provisions of Section 2.02(a)(ii) of this
          Appendix B, 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

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<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 Appendix B, if Sufficient Bids have not
               been made.

               (3)  Subject to the provisions of Section 2.02(a)(ii) of this
          Appendix B, a Bid by a Potential Owner shall constitute an irrevocable
          offer to purchase:

                    a.  the principal amount of Outstanding Auction Rate Notes
               specified in such Bid if the Auction Note Interest Rate
               determined as provided in this Section 2.02(a) shall be higher
               than the rate specified in such Bid; or

                    b.  such principal amount, or a lesser principal amount of
               Outstanding Auction Rate Notes set forth in Section
               2.02(a)(iv)(A)(5) of this Appendix B, if the Auction Note
               Interest Rate determined as provided in this Section 2.02(a)
               shall be equal to the rate specified in such Bid.

          (ii) (A)  Each Broker-Dealer shall submit in writing to the Auction
     Agent prior to the Submission Deadline on each Auction Date all Orders
     obtained by such Broker-Dealer and shall specify with respect to each such
     Order:

               (1)  the name of the Bidder placing such Order;

               (2)  the aggregate principal amount of Auction Rate Notes that
          are the subject of such Order;

               (3)  to the extent that such Bidder is an Existing Owner:

                         a. the principal amount of Auction Rate Notes, if any,
                    subject to any Hold Order placed by such Existing Owner;

                         b. the principal amount of Auction Rate Notes, if any,
                    subject to any Bid placed by such Existing Owner and the
                    rate specified in such Bid; and

                         c. the principal amount of Auction Rate Notes, if any,
                    subject to any Sell Order placed by such Existing Owner;

                    and

                    (4) to the extent such Bidder is a Potential Owner, the rate
               specified in such Potential Owner's Bid.

               (B)  If any rate specified in any Bid contains more than three
          figures to the right of the decimal point, the Auction Agent shall
          round such rate up to the next higher one thousandth of 1%.

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               (C)  If an Order or Orders covering all Outstanding Auction Rate
          Notes owned by an Existing Owner is not submitted to the Auction Agent
          prior to the Submission Deadline, the Auction Agent shall deem a Hold
          Order to have been submitted on behalf of such Existing Owner covering
          the principal amount of Outstanding Auction Rate Notes owned by such
          Existing Owner and not subject to an Order submitted to the Auction
          Agent.

               (D)  Neither the Issuer, the Indenture Trustee nor the Auction
          Agent shall be responsible for any failure of a Broker-Dealer to
          submit an Order to the Auction Agent on behalf of any Existing Owner
          or Potential Owner.

               (E)  If any Existing Owner submits through a Broker-Dealer to the
          Auction Agent one or more Orders covering in the aggregate more than
          the principal amount of Outstanding Auction Rate Notes owned by such
          Existing Owner, such Orders shall be considered valid as follows and
          in the following order of priority:

                    (1)  All Hold Orders shall be considered valid, but only up
               to the aggregate principal amount of Outstanding Auction Rate
               Notes owned by such Existing Owner, and if the aggregate
               principal amount of Auction Rate Notes subject to such Hold
               Orders exceeds the aggregate principal amount of Auction Rate
               Notes owned by such Existing Owner, the aggregate principal
               amount of Auction Rate Notes subject to each such Hold Order
               shall be reduced pro rata so that the aggregate principal amount
               of Auction Rate Notes subject to such Hold Order equals the
               aggregate principal amount of Outstanding Auction Rate Notes
               owned by such Existing Owner.

                    (2)  a. Any Bid shall be considered valid up to an amount
               equal to the excess of the principal amount of Outstanding
               Auction Rate Notes owned by such Existing Owner over the
               aggregate principal amount of Auction Rate Notes subject to any
               Hold Order referred to in clause (A) of this paragraph (ii);

                         b. subject to subclause (2)a. of this clause (E), if
                    more than one Bid with the same rate is submitted on behalf
                    of such Existing Owner and the aggregate principal amount of
                    Outstanding Auction Rate Notes subject to such Bids is
                    greater than such excess, such Bids shall be considered
                    valid up to an amount equal to such excess;

                         c. subject to subclauses (2)a. and (2)b. of this clause
                    (E), if more than one Bid with different rates are submitted
                    on behalf of such Existing Owner, such Bids shall be
                    considered valid first in the ascending order of their
                    respective rates until the

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                    highest rate is reached at which such excess exists and then
                    at such rate up to the amount of such excess; and

                         d. in any such event, the amount of Outstanding Auction
                    Rate Notes, if any, subject to Bids not valid under this
                    clause (E) shall be treated as the subject of a Bid by a
                    Potential Owner at the rate therein specified; and

                    (3) All Sell Orders shall be considered valid up to an
               amount equal to the excess of the principal amount of Outstanding
               Auction Rate Notes owned by such Existing Owner over the
               aggregate principal amount of Auction Rate Notes subject to Hold
               Orders referred to in clause (1) of this paragraph (E) and valid
               Bids referred to in clause (2) of this paragraph (E).

               (F)  If more than one Bid for Auction Rate Notes is submitted on
          behalf of any Potential Owner, each Bid submitted shall be a separate
          Bid with the rate and principal amount therein specified.

               (G)  An Existing Owner that offers to purchase additional Auction
          Rate Notes is, for purposes of such offer, treated as a Potential
          Owner.

               (H)  Any Bid or Sell Order submitted by an Existing Owner
          covering an aggregate principal amount of Auction Rate Notes not equal
          to an Authorized Denomination shall be rejected and shall be deemed a
          Hold Order. Any Bid submitted by a Potential Owner covering an
          aggregate principal amount of Auction Rate Notes not equal to an
          Authorized Denomination shall be rejected.

               (I)  Any Bid specifying a rate higher than the applicable Maximum
          Rate will (1) be treated as a Sell Order if submitted by an Existing
          Owner and (2) not be accepted if submitted by a Potential Owner.

               (J)  Any Order submitted in an Auction by a Broker-Dealer to the
          Auction Agent prior to the Submission Deadline on any Auction Date
          shall be irrevocable.

          (iii)(A) Not earlier than the Submission Deadline on each Auction
     Date, the Auction Agent shall assemble all valid Orders submitted or deemed
     submitted to it by the Broker-Dealers (each such Order as submitted or
     deemed submitted by a Broker-Dealer being herein referred to individually
     as a "Submitted Hold Order," a "Submitted Bid" or a "Submitted Sell Order,"
     as the case may be, or as a "Submitted Order," and collectively as
     "Submitted Hold Orders," "Submitted Bids" or "Submitted Sell Orders," as
     the case may be, or as "Submitted Orders") and shall determine:

                    (1) the excess of the total principal amount of Outstanding
               Auction Rate Notes over the sum of the aggregate principal amount
               of

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               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 that, when added to the
               aggregate principal amount of Outstanding Auction Rate Notes to
               be purchased by such Potential Owners described in subclause b.
               above, would equal not less than the Available Auction Rate
               Notes.

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               (B)  Promptly after the Auction Agent has made the determinations
          pursuant to Section 2.02(a)(iii)(A) of this Appendix B, the Auction
          Agent shall advise the Indenture Trustee, the Broker-Dealers and the
          Issuer of the Net Loan Rate, Maximum Rate and the All Hold Rate and
          the components thereof on the Auction Date. Based on such
          determinations, the Auction Rate for the next succeeding Interest
          Period will be established as follows:

                    (1)  if Sufficient Bids exist, that the Auction Rate for the
               next succeeding Interest Period shall be equal to the Bid Auction
               Rate so determined;

                    (2)  if Sufficient Bids do not exist (other than because all
               of the Outstanding Auction Rate Notes are subject to Submitted
               Hold Orders), that the Auction Rate for the next succeeding
               Interest Period shall be equal to the applicable Maximum Rate; or

                    (3)  if all Outstanding Auction Rate Notes are subject to
               Submitted Hold Orders, that the Auction Rate for the next
               succeeding Interest Period shall be equal to the applicable All
               Hold Rate.

               (C) Promptly after the Auction Agent has determined the Auction
          Rate, the Auction Agent shall determine and advise the Indenture
          Trustee of the Auction Note Interest Rate, which rate shall be the
          lesser of (x) the Auction Rate and (y) the applicable Maximum Rate.

          (iv)  Existing Owners shall continue to own the principal amount of
     Auction Rate Notes that are subject to Submitted Hold Orders. If the Net
     Loan Rate is equal to or greater than the Bid Auction Rate and if
     Sufficient Bids have been received by the Auction Agent, the Bid Auction
     Rate will be the Auction Note Interest Rate, and Submitted Bids and
     Submitted Sell Orders will be accepted or rejected and the Auction Agent
     will take such other action as described below in subparagraph (A).

     If the Maximum Rate is less than the Auction Rate, the Maximum Rate will be
the Auction Note Interest Rate. If the Auction Agent has not received Sufficient
Bids (other than because all of the Outstanding Auction Rate Notes are subject
to Submitted Hold Orders), the Auction Note Interest Rate will be the applicable
Maximum Rate. In any of the cases described above, Submitted Orders will be
accepted or rejected and the Auction Agent will take such other action as
described below in subparagraph (B).

               (A)  If Sufficient Bids have been made and the Maximum Rate is
          equal to or greater than the Bid Auction Rate (in which case the
          Auction Note Interest Rate shall be the Bid Auction Rate), all
          Submitted Sell Orders shall be accepted and, subject to the provisions
          of clauses (4) and (5) of this Section 2.02(a)(iv), Submitted Bids
          shall be accepted or rejected as follows in the following order of
          priority, and all other Submitted Bids shall be rejected:

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               (1)  Existing Owners' Submitted Bids specifying any rate that is
          higher than the Auction Note Interest Rate shall be accepted, thus
          requiring each such Existing Owner to sell the aggregate principal
          amount of Auction Rate Notes subject to such Submitted Bids;

               (2)  Existing Owners' Submitted Bids specifying any rate that is
          lower than the Auction Note Interest Rate shall be rejected, thus
          entitling each such Existing Owner to continue to own the aggregate
          principal amount of Auction Rate Notes subject to such Submitted Bids;

               (3)  Potential Owners' Submitted Bids specifying any rate that is
          lower than the Auction Note Interest Rate shall be accepted;

               (4) Each Existing Owners' Submitted Bid specifying a rate that is
          equal to the Auction Note Interest Rate shall be rejected, thus
          entitling such Existing Owner to continue to own the aggregate
          principal amount of Auction Rate Notes subject to such Submitted Bid,
          unless the aggregate principal amount of Outstanding Auction Rate
          Notes subject to all such Submitted Bids shall be greater than the
          principal amount of Auction Rate Notes (the "remaining principal
          amount") equal to the excess of the Available Auction Rate Notes over
          the aggregate principal amount of Auction Rate Notes subject to
          Submitted Bids described in clauses (2) and (3) of this Section
          2.02(a)(iv)(A), in which event such Submitted Bid of such Existing
          Owner shall be rejected in part, and such Existing Owner shall be
          entitled to continue to own the principal amount of Auction Rate Notes
          subject to such Submitted Bid, but only in an amount equal to the
          aggregate principal amount of Auction Rate Notes obtained by
          multiplying the remaining principal amount by a fraction, the
          numerator of which shall be the principal amount of Outstanding
          Auction Rate Notes owned by such Existing Owner subject to such
          Submitted Bid and the denominator of which shall be the sum of the
          principal amount of Outstanding Auction Rate Notes subject to such
          Submitted Bids made by all such Existing Owners that specified a rate
          equal to the Auction Note Interest Rate, subject to the provisions of
          Section 2.02(a)(iv)(D) of this Appendix B; 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

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<PAGE>

          subject to such Submitted Bid and the denominator of which shall be
          the sum of the principal amount of Outstanding Auction Rate Notes
          subject to Submitted Bids made by all such Potential Owners that
          specified a rate equal to the Auction Note Interest Rate, subject to
          the provisions of Section 2.02(a)(iv)(D) of this Appendix B.

          (B)  If Sufficient Bids have not been made (other than because all of
     the Outstanding Auction Rate Notes are subject to submitted Hold Orders),
     or if the Maximum Rate is less than the Bid Auction Rate (in which case the
     Auction Note Interest Rate shall be the Maximum Rate), subject to the
     provisions of Section 2.02(a)(iv)(D) of this Appendix B, 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,

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<PAGE>

     round up or down the principal amount of Auction Rate Notes to be purchased
     or sold by any Existing Owner or Potential Owner so that the principal
     amount of Auction Rate Notes purchased or sold by each Existing Owner or
     Potential Owner shall be equal to an Authorized Denomination.

          (E)  If, as a result of the procedures described in paragraph (B) of
     this Section 2.02(a)(iv), any Potential Owner would be entitled or required
     to purchase less than an Authorized Denomination of Auction Rate Notes, the
     Auction Agent shall, in such manner as in its sole discretion it shall
     determine, allocate Auction Rate Notes for purchase among Potential Owners
     so that only Auction Rate Notes in Authorized Denominations are purchased
     by any Potential Owner, even if such allocation results in one or more of
     such Potential Owners not purchasing any Auction Rate Notes.

     (v)   Based on the result of each Auction, the Auction Agent shall
determine the aggregate principal amount of Auction Rate Notes to be purchased
and the aggregate principal amount of Auction Rate Notes to be sold by Potential
Owners and Existing Owners on whose behalf each Broker-Dealer submitted Bids or
Sell Orders and, with respect to each Broker-Dealer, to the extent that such
aggregate principal amount of Auction Rate Notes to be sold differs from such
aggregate principal amount of Auction Rate Notes to be purchased, determine to
which other Broker-Dealer or Broker-Dealers acting for one or more purchasers
such Broker-Dealer shall deliver, or from which other Broker-Dealer or
Broker-Dealers acting for one or more sellers such Broker-Dealer shall receive,
as the case may be, Auction Rate Notes.

     (vi)  Any calculation by the Auction Agent or the Indenture Trustee, as
applicable, of the Auction Note Interest Rate, the Maximum Rate, the All Hold
Rate, the Net Loan Rate and the Non-Payment Rate shall, in the absence of
manifest error, be binding on all other parties.

     (vii) Notwithstanding anything in this Appendix B 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 Collection Account to pay, or otherwise held by the Indenture
Trustee under the Indenture and available to pay, the principal of and interest
due on the Auction Rate Notes on the Payment Date immediately following such
Auction Date, and (B) no Auction will be held on any Auction Date hereunder
during the continuance of a Payment Default. The Indenture Trustee shall
promptly notify the Auction Agent of any such occurrence.

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

     (i) The Indenture Trustee shall determine not later than 2:00 p.m., eastern
time, on the Business Day next succeeding a Payment Date, whether a Payment
Default has occurred. If a Payment Default has occurred, the Indenture Trustee
shall, not later than 2:15 p.m., eastern time, on such Business Day, send a
notice thereof in substantially

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     the form of Exhibit D attached hereto to the Auction Agent by telecopy or
     similar means and, if such Payment Default is cured, the Indenture Trustee
     shall immediately send a notice in substantially the form of Exhibit E
     attached hereto to the Auction Agent by telecopy or similar means.

          (ii) Not later than 2:00 p.m., eastern time, on each anniversary of
     the Closing Date, the Indenture Trustee shall pay to the Auction Agent, in
     immediately available funds out of amounts in the Collection Account, an
     amount equal to the Auction Agent Fee as set forth in the Auction Agent
     Agreement as set forth in the Servicer's Report. Not later than 2:00 p.m.,
     eastern time, on each Auction Date, the Indenture Trustee shall pay to the
     Auction Agent, in immediately available funds out of amounts in the
     Collection Account, an amount equal to the Broker-Dealer Fee as calculated
     in the Auction Agent Agreement. The Indenture Trustee shall, from time to
     time at the request of the Auction Agent and at the direction of an
     Authorized Officer, reimburse the Auction Agent for its reasonable expenses
     as provided in the Auction Agent Agreement, such expenses to be paid out of
     amounts in the Collection Account.

     (c)  Calculation of Maximum Rate, All Hold Rate, Net Loan Rate, Applicable
LIBOR Rate, and Non-Payment Rate. The Auction Agent shall calculate the
applicable Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold
Rate, as the case may be, on each Auction Date and shall notify the Indenture
Trustee and the Broker-Dealers of the applicable Maximum Rate, Net Loan Rate,
Applicable LIBOR Rate, and All Hold Rate, as the case may be, as provided in the
Auction Agent Agreement; provided, that if the ownership of the Auction Rate
Notes is no longer maintained in Book-entry Form, or if a Payment Default has
occurred, then the Indenture Trustee shall determine the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and Non-Payment Rate
for each such Interest Period. If the ownership of the Auction Rate Notes is no
longer maintained in Book-entry Form by the Securities Depository, the Indenture
Trustee shall calculate the applicable Maximum Rate and the Net Loan Rate on the
Business Day immediately preceding the first day of each Interest Period after
the delivery of certificates representing the Auction Rate Notes pursuant to the
Indenture. If a Payment Default shall have occurred, the Indenture Trustee shall
calculate the Non-Payment Rate on the Interest Rate Determination Date for (i)
each Interest Period commencing after the occurrence and during the continuance
of such Payment Default and (ii) any Interest Period commencing less than two
Business Days after the cure of any Payment Default. The determination by the
Indenture Trustee or the Auction Agent, as the case may be, of the applicable
Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and
Non-Payment Rate shall (in the absence of manifest error) be final and binding
upon all parties. If calculated or determined by the Auction Agent, the Auction
Agent shall promptly advise the Indenture Trustee of the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold Rate.

     (d)   Notification of Rates, Amounts and Payment Dates.

          (i)  By 12:00 noon, eastern time, on the Business Day following each
     Regular Record Date, the Indenture Trustee shall determine the aggregate
     amounts of interest

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<PAGE>

     distributable on the next succeeding Payment Date to the beneficial owners
     of Auction Rate Notes.

          (ii) At least four days prior to any Payment Date, the Indenture
     Trustee shall:

               (A)  confirm with the Auction Agent, so long as no Payment
          Default has occurred and is continuing and the ownership of the
          Auction Rate Notes is maintained in Book-entry Form by the Securities
          Depository, (1) the date of such next Payment Date and (2) the amount
          payable to the Auction Agent on the Auction Date pursuant to Section
          2.02(b)(ii) of this Appendix B; and

               (B)  advise the Securities Depository, so long as the ownership
          of the Auction Rate Notes is maintained in Book-entry Form by the
          Securities Depository, upon request, of the aggregate amount of
          interest distributable on such next Payment Date to the beneficial
          owners of each Series of the Auction Rate Notes.

     If any day scheduled to be a Payment Date shall be changed after the
Indenture Trustee shall have given the notice or confirmation referred to in
clause (i) of the preceding sentence, the Indenture Trustee shall, not later
than 11:15 a.m., eastern time, on the Business Day next preceding the earlier of
the new Payment Date or the old Payment Date, by such means as the Indenture
Trustee deems practicable, give notice of such change to the Auction Agent, so
long as no Payment Default has occurred and is continuing and the ownership of
the Auction Rate Notes is maintained in Book-entry Form by the Securities
Depository.

     (e)   Auction Agent.

          (i)  Deutsche Bank Trust Company Americas is hereby appointed as
     Initial Auction Agent to serve as agent for the Issuer in connection with
     Auctions. The Indenture Trustee and the Issuer will, and the Indenture
     Trustee is hereby directed to, enter into the Initial Auction Agent
     Agreement with Deutsche Bank Trust Company Americas, as the Initial Auction
     Agent. Any Substitute Auction Agent shall be (A) a bank, national banking
     association or trust company duly organized under the laws of the United
     States of America or any state or territory thereof having its principal
     place of business in the Borough of Manhattan, New York, or such other
     location as approved by the Indenture Trustee in writing and having a
     combined capital stock or surplus of at least $50,000,000, or (B) a member
     of the National Association of Securities Dealers, Inc., having a
     capitalization of at least $50,000,000, and, in either case, authorized by
     law to perform all the duties imposed upon it hereunder and under the
     Auction Agent Agreement. The Auction Agent may at any time resign and be
     discharged of the duties and obligations created by this Appendix B by
     giving at least 90 days' notice to the Indenture Trustee, each
     Broker-Dealer and the Issuer. The Auction Agent may be removed at any time
     by the Indenture Trustee upon the written direction of an Authorized
     Officer or by the holders of a majority of the aggregate principal amount
     of the Auction Rate Notes then Outstanding, and if by such Noteholders, by
     an instrument signed by such Noteholders or their attorneys and filed with
     the Auction Agent, the Issuer and the

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     Indenture Trustee upon at least 90 days' written notice. Neither
     resignation nor removal of the Auction Agent pursuant to the preceding two
     sentences shall be effective until and unless a Substitute Auction Agent
     has been appointed and has accepted such appointment. If required by the
     Issuer, a Substitute Auction Agent Agreement shall be entered into with a
     Substitute Auction Agent. Notwithstanding the foregoing, the Auction Agent
     may terminate the Auction Agent Agreement if, within 25 days after
     notifying the Indenture Trustee, each Broker-Dealer and the Issuer in
     writing that it has not received payment of any Auction Agent Fee due it in
     accordance with the terms of the Auction Agent Agreement, the Auction Agent
     does not receive such payment.

          (ii)  If the Auction Agent shall resign or be removed or be dissolved,
     or if the property or affairs of the Auction Agent shall be taken under the
     control of any state or federal court or administrative body because of
     bankruptcy or insolvency, or for any other reason, the Indenture Trustee at
     the direction of an Authorized Officer, shall use its best efforts to
     appoint a Substitute Auction Agent.

          (iii) The Auction Agent is acting as agent for the Issuer in
     connection with Auctions. In the absence of bad faith, negligent failure to
     act or negligence on its part, the Auction Agent shall not be liable for
     any action taken, suffered or omitted or any error of judgment made by it
     in the performance of its duties under the Auction Agent Agreement and
     shall not be liable for any error of judgment made in good faith unless the
     Auction Agent shall have been negligent in ascertaining (or failing to
     ascertain) the pertinent facts.

     (f)  Broker-Dealers.

          (i)  The Auction Agent will enter into a Broker-Dealer Agreement with
     William R. Hough & Co., as the sole initial Broker-Dealer for the Series
     A-4 Notes, and Citigroup Global Markets Inc., as the sole initial
     Broker-Dealer for the Series A-5 Notes, the Series A-6 Notes, the Series
     A-7 Notes, the Series A-8 Notes and the Series B-1 Notes. An Authorized
     Officer may, from time to time, approve one or more additional Persons to
     serve as a Broker-Dealer under the Broker-Dealer Agreements and shall be
     responsible for providing such Broker-Dealer Agreements to the Indenture
     Trustee and the Auction Agent.

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

     (g)  Changes in Auction Period or Periods and Certain Percentages.

          (i)   While any of the Auction Rate Notes are Outstanding, the Issuer
     may, from time to time, change the length of one or more Auction Periods
     (an "Auction Period Adjustment"), to conform with then current market
     practice with respect to similar securities or to accommodate economic and
     financial factors that may affect or be relevant to the length of the
     Auction Period and the interest rate borne by the Auction Rate Notes. The
     Issuer shall not initiate an Auction Period Adjustment unless it shall

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                                                              Indenture of Trust

<PAGE>

     have received the written consent of the Market Agent, which consent shall
     not be unreasonably withheld, not later than nine days prior to the Auction
     Date for such Auction Period. The Issuer shall not initiate an Auction
     Period Adjustment that would result in an Auction Period longer than 120
     days unless it shall have received a Rating Confirmation regarding that
     Auction Period Adjustment. The Issuer shall initiate the Auction Period
     Adjustment by giving written notice by Issuer Order to the Indenture
     Trustee, the Auction Agent, the Market Agent, each Broker-Dealer, each
     Rating Agency and the Securities Depository in substantially the form of,
     or containing substantially the information contained in, Exhibit F
     attached hereto at least 10 days prior to the Auction Date for such Auction
     Period.

          (ii)  Any such adjusted Auction Period shall not be less than 7 days
     nor more than 366 days.

          (iii) An Auction Period Adjustment shall take effect only if (A) the
     Indenture Trustee and the Auction Agent receive, by 11:00 a.m., eastern
     time, on the Business Day before the Auction Date for the first such
     Auction Period, an Issuer Certificate in substantially the form attached
     as, or containing substantially the same information contained in, Exhibit
     G attached hereto, authorizing the Auction Period Adjustment specified in
     such certificate along with a copy of the written consent of the Market
     Agent and, (B) Sufficient Bids exist as of the Auction on the Auction Date
     for such first Auction Period. If the condition referred to in (A) above is
     not met, the applicable Auction Note Interest Rate for the next Auction
     Period shall be determined pursuant to the above provisions of this Section
     2.02 and the Auction Period shall be the Auction Period determined without
     reference to the proposed change. If the condition referred to in (A) is
     met but the condition referred in (B) above is not met, the applicable
     Auction Note Interest Rate for the next Auction Period shall be the
     applicable Maximum Rate and the Auction Period shall be the Auction Period
     determined without reference to the proposed change.

     In connection with any Auction Period Adjustment, the Auction Agent shall
provide such further notice to such parties as is specified in Section 2.03 of
the Auction Agent Agreement.

     (h)  Changes in the Auction Date. The Market Agent, with the written
consent of the Administrator on behalf of the Issuer, may specify a different
Auction Date (but in no event more than five Business Days earlier than the
Auction Date that would otherwise be determined in accordance with the
definition of "Auction Date" in Section 1.01 of this Appendix B) with respect
to one or more specified Auction Periods to conform with then current market
practice with respect to similar securities or to accommodate economic and
financial factors that may affect or be relevant to the day of the week
constituting an Auction Date and the interest rate borne on the Auction Rate
Notes. The Market Agent shall deliver a written request for consent to such
change in the Auction Date to the Administrator at least 14 days prior to the
effective date of such change. If the Administrator shall have delivered such
written consent to the Market Agent, the Market Agent shall provide notice of
its determination to specify an earlier Auction Date for one or more Auction
Periods by means of a written notice delivered at least 10 days prior to the
proposed changed Auction Date to the Indenture Trustee, the Auction Agent, the

                                      B-24
                                                              Indenture of Trust

<PAGE>

Issuer, the Administrator, each Rating Agency and the Securities Depository.
Such notice shall be substantially in the form of, or contain substantially the
information contained in, Exhibit H attached hereto.

     In connection with any change described in this Section 2.02(h), the
Auction Agent shall provide such further notice to such parties as is specified
in Section 2.03 of the Auction Agent Agreement.

     Section 2.03 Additional Provisions Regarding the Interest Rates on the
Auction Rate Notes. The determination of an Auction Note Interest Rate by the
Auction Agent or any other Person pursuant to the provisions of the applicable
Section of this Article II shall be conclusive and binding on the Noteholders of
the Auction Rate Notes to which such Auction Note Interest Rate applies, and the
Issuer and the Indenture Trustee may rely thereon for all purposes.

     In no event shall the cumulative amount of interest paid or payable on the
Auction Rate Notes (including interest calculated as provided herein, plus any
other amounts that constitute interest on the Auction Rate Notes under
applicable law and are contracted for, charged, reserved, taken or received
pursuant to the Auction Rate Notes or related documents) calculated from the
Closing Date of the Auction Rate Notes through any subsequent day during the
term of the Auction Rate Notes or otherwise prior to payment in full of the
Auction Rate Notes exceed the amount permitted by applicable law. If the
applicable law is ever judicially interpreted so as to render usurious any
amount called for under the Auction Rate Notes or related documents or otherwise
contracted for, charged, reserved, taken or received in connection with the
Auction Rate Notes, or if the redemption or acceleration of the maturity of the
Auction Rate Notes results in payment to or receipt by the Noteholder or any
former Noteholder of the Auction Rate Notes of any interest in excess of that
permitted by applicable law, then, notwithstanding any provision of the Auction
Rate Notes or related documents to the contrary, all excess amounts theretofore
paid or received with respect to the Auction Rate Notes shall be credited on the
principal balance of the Auction Rate Notes (or, if the Auction Rate Notes have
been paid or would thereby be paid in full, refunded by the recipient thereof),
and the provisions of the Auction Rate Notes and related 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.

                                      B-25
                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT C

                          CLOSING CASH FLOW PROJECTIONS

                             (to be attached hereto)

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT D

                            NOTICE OF PAYMENT DEFAULT

                       EDUCATION FUNDING CAPITAL TRUST-III
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

     NOTICE IS HEREBY GIVEN that a Payment Default has occurred and is
continuing with respect to the Auction Rate Notes identified above. The next
Auction for the Auction Rate Notes will not be held. The Auction Rate for the
Auction Rate Notes for the next succeeding Interest Period shall be the
Non-Payment Rate.

                                        Fifth Third Bank, as Indenture Trustee

Dated:                                  By:
       ----------------------------        -------------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT E

                        NOTICE OF CURE OF PAYMENT DEFAULT

                       EDUCATION FUNDING CAPITAL TRUST-III
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

     NOTICE IS HEREBY GIVEN that a Payment Default with respect to the Auction
Rate Notes identified above has been waived or cured. The next Payment Date is
__________________________ and the Auction Date is __________________________.

                                        Fifth Third Bank, as Indenture Trustee

Dated:                                  By:
       ----------------------------        -------------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT F

                       NOTICE OF PROPOSED CHANGE IN LENGTH
                         OF ONE OR MORE AUCTION PERIODS

                       EDUCATION FUNDING CAPITAL TRUST-III
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

     Notice is hereby given that the Issuer proposes to change the length of one
or more Auction Periods pursuant to the Indenture as follows:

     1.   The change shall take effect on _______________, the Interest Rate
Adjustment Date for the next Auction Period (the "Effective Date").

     2.   The Auction Period Adjustment in Paragraph 1 shall take place only if
(a) the Indenture Trustee and the Auction Agent receive, by 11:00 a.m., eastern
time, on the Business Day before the Auction Date for the Auction Period
commencing on the Effective Date, a certificate from the Issuer, as required by
the Indenture authorizing the change in length of one or more Auction Periods
and (b) Sufficient Bids exist on the Auction Date for the Auction Period
commencing on the Effective Date.

     3.   If the condition referred to in (a) above is not met, the Auction Rate
for the Auction Period commencing on the Effective Date will be determined
pursuant to the Auction Procedures and the Auction Period shall be the Auction
Period determined without reference to the proposed change. If the condition
referred to in (a) is met but the condition referred to in (b) above is not met,
the Auction Rate for the Auction Period commencing on the Effective Date shall
be the Maximum Rate and the Auction Period shall be the Auction Period
determined without reference to the proposed change.

     4.   It is hereby represented, upon advice of the Auction Agent for the
Series __ Notes described herein, that there were Sufficient Bids for such
Series __ Notes at the Auction immediately preceding the date of this Notice.

     5.   Terms not defined in this Notice shall have the meanings set forth in
the Indenture entered into in connection with the Series __ Notes.

                                        Education Funding Capital Trust-III

Dated:                                  By:
       ------------------------            -------------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT G

                      NOTICE ESTABLISHING CHANGE IN LENGTH
                         OF ONE OR MORE AUCTION PERIODS

                      EDUCATION FUNDING CAPITAL TRUST-III]
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

     Notice is hereby given that the Issuer hereby establishes new lengths for
one or more Auction Periods pursuant to the Indenture:

     1.   The change shall take effect on _______________, the Interest Rate
Adjustment Date for the next Auction Period (the "Effective Date").

     2.   For the Auction Period commencing on the Effective Date, the Interest
Rate Adjustment Date shall be _______________, or the next succeeding Business
Day if such date is not a Business Day.

     3.   For Auction Periods occurring after the Auction Period commencing on
the Effective Date, the Interest Rate Adjustment Date shall be
[_______________(date) and every ______________(number) ______________(day of
week) thereafter] [every ______________(number) ______________(day of week)
after the date set forth in paragraph 2 above], or the next Business Day if any
such day is not a Business Day; provided, however, that the length of subsequent
Auction Periods shall be subject to further change hereafter as provided in the
Indenture.

     4.   The changes described in paragraphs 2 and 3 above shall take place
only upon delivery of this Notice and the satisfaction of other conditions set
forth in the Indenture and our prior notice dated _______________ regarding the
proposed change.

     5.   Terms not defined in this Notice shall have the meanings set forth in
the Indenture relating to the Series __ Notes.

                                        Education Funding Capital Trust-III

Dated:                                  By:
       ---------------------------         -------------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT H

                        NOTICE OF CHANGE IN AUCTION DATE

                       EDUCATION FUNDING CAPITAL TRUST-III
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

     Notice is hereby given by __________, as Broker-Dealer for the Auction Rate
Notes identified above, that with respect to the Auction Rate Notes, the Auction
Date is hereby changed as follows:

     1.   With respect to Series __ Notes, the definition of "Auction
Date" shall be deemed amended by substituting "_______________(number) Business
Day" in the second line thereof and by substituting "_______________(number)
Business Days" for "two Business Days" in subsection (d) thereof.

     2.   This change shall take effect on _______________ which shall be the
Auction Date for the Auction Period commencing on _______________.

     3.   The Auction Date for the Series __ Notes shall be subject to further
change hereafter as provided in the Indenture.

     4.   Terms not defined in this Notice shall have the meaning set forth in
the Indenture relating to the Series __ Notes.

                                        __________, as Broker-Dealer

Dated:                                  By:
      ---------------------------          -------------------------------------

                                                              Indenture of Trust

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