Document:

Exhibit 4.3

 

 

 

INDENTURE

 

 

among

 

 

SLM STUDENT LOAN TRUST 2004-8

as the Issuer,

 

 

CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,

not in its individual capacity but

solely as the Eligible Lender Trustee

 

 

and

 

 

DEUTSCHE BANK TRUST COMPANY AMERICAS,

not in its individual capacity but

solely as the Indenture Trustee

 

Dated as of August 1, 2004

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I

  
	
  Definitions and Usage

  
	
   

  	
   

  
	
  SECTION 1.1

  	
  Definitions and Usage

  	
   

  
	
  SECTION
  1.2

  	
  Incorporation by Reference of Trust
  Indenture Act

  	
   

  
	
   

  	
   

  
	
  ARTICLE II

  
	
  The Notes

  
	
   

  	
   

  
	
  SECTION 2.1

  	
  Form

  	
   

  
	
  SECTION
  2.2

  	
  Execution, Authentication and Delivery

  	
   

  
	
  SECTION 2.3

  	
  Temporary Notes

  	
   

  
	
  SECTION
  2.4

  	
  Registration; Registration of Transfer and
  Exchange

  	
   

  
	
  SECTION 2.5

  	
  Mutilated, Destroyed, Lost or Stolen Notes

  	
   

  
	
  SECTION 2.6

  	
  Persons Deemed Owner

  	
   

  
	
  SECTION 2.7

  	
  Payment of Principal and Interest; Note
  Interest Shortfall

  	
   

  
	
  SECTION 2.8

  	
  Cancellation

  	
   

  
	
  SECTION 2.9

  	
  Release of Collateral

  	
   

  
	
  SECTION 2.10

  	
  Book-Entry Notes

  	
   

  
	
  SECTION 2.11

  	
  Notices to Clearing Agency

  	
   

  
	
  SECTION 2.12

  	
  Definitive Notes

  	
   

  
	
  SECTION 2.13

  	
  Transfer Restrictions

  	
   

  
	
   

  	
   

  
	
  ARTICLE III

  
	
  Covenants

  
	
   

  	
   

  
	
  SECTION
  3.1

  	
  Payments to Noteholders and each Swap
  Counterparty

  	
   

  
	
  SECTION 3.1A

  	
  Collateral Account

  	
   

  
	
  SECTION 3.2

  	
  Maintenance of Office or Agency

  	
   

  
	
  SECTION 3.3

  	
  Money for Payments to be Held in Trust

  	
   

  
	
  SECTION 3.4

  	
  Existence

  	
   

  
	
  SECTION 3.5

  	
  Protection of Indenture Trust Estate

  	
   

  
	
  SECTION 3.6

  	
  Opinions as to Indenture Trust Estate

  	
   

  
	
  SECTION
  3.7

  	
  Performance of Obligations; Servicing of
  Trust Student Loans

  	
   

  
	
  SECTION 3.8

  	
  Negative Covenants

  	
   

  
	
  SECTION 3.9

  	
  Annual Statement as to Compliance

  	
   

  
	
  SECTION 3.10

  	
  Issuer May Consolidate, etc., Only on
  Certain Terms.

  	
   

  
	
  SECTION 3.11

  	
  Successor or Transferee

  	
   

  
	
  SECTION 3.12

  	
  No Other Business

  	
   

  
	
  SECTION 3.13

  	
  No Borrowing

  	
   

  
	
  SECTION
  3.14

  	
  Obligations of Servicer and Administrator

  	
   

  
	
  SECTION
  3.15

  	
  Guarantees, Loans, Advances and Other
  Liabilities

  	
   

  

 

i

 

	
  SECTION 3.16

  	
  Capital Expenditures

  	
   

  
	
  SECTION 3.17

  	
  Restricted Payments

  	
   

  
	
  SECTION 3.18

  	
  Notice of Events of Default

  	
   

  
	
  SECTION 3.19

  	
  Further Instruments and Acts

  	
   

  
	
   

  	
   

  
	
  ARTICLE IV

  
	
  Satisfaction and Discharge

  
	
   

  	
   

  
	
  SECTION
  4.1

  	
  Satisfaction and Discharge of Indenture

  	
   

  
	
  SECTION 4.2

  	
  Application of Trust Money

  	
   

  
	
  SECTION
  4.3

  	
  Repayment of Moneys Held by Paying Agent

  	
   

  
	
  SECTION 4.4

  	
  Auction of Trust Student Loans

  	
   

  
	
   

  	
   

  
	
  ARTICLE V

  
	
  Remedies

  
	
   

  	
   

  
	
  SECTION 5.1

  	
  Events of Default

  	
   

  
	
  SECTION
  5.2

  	
  Acceleration of Maturity; Rescission and
  Annulment

  	
   

  
	
  SECTION
  5.3

  	
  Collection of Indebtedness and Suits for
  Enforcement by Indenture Trustee

  	
   

  
	
  SECTION 5.4

  	
  Remedies; Priorities

  	
   

  
	
  SECTION
  5.5

  	
  Optional Preservation of the Trust Student
  Loans

  	
   

  
	
  SECTION 5.6

  	
  Limitation of Suits

  	
   

  
	
  SECTION
  5.7

  	
  Unconditional Rights of Noteholders to
  Receive Principal and Interest

  	
   

  
	
  SECTION 5.8

  	
  Restoration of Rights and Remedies

  	
   

  
	
  SECTION 5.9

  	
  Rights and Remedies Cumulative

  	
   

  
	
  SECTION 5.10

  	
  Delay or Omission Not a Waiver

  	
   

  
	
  SECTION 5.11

  	
  Control by Noteholders

  	
   

  
	
  SECTION 5.12

  	
  Waiver of Past Defaults

  	
   

  
	
  SECTION 5.13

  	
  Undertaking for Costs

  	
   

  
	
  SECTION 5.14

  	
  Waiver of Stay or Extension Laws

  	
   

  
	
  SECTION 5.15

  	
  Action on Notes

  	
   

  
	
  SECTION
  5.16

  	
  Performance and Enforcement of Certain
  Obligations.

  	
   

  
	
   

  	
   

  
	
  ARTICLE VI

  
	
  The Indenture Trustee

  
	
   

  	
   

  
	
  SECTION 6.1

  	
  Duties of Indenture Trustee

  	
   

  
	
  SECTION 6.2

  	
  Rights of Indenture Trustee

  	
   

  
	
  SECTION
  6.3

  	
  Individual Rights of Indenture Trustee

  	
   

  
	
  SECTION 6.4

  	
  Indenture Trustee’s Disclaimer

  	
   

  
	
  SECTION 6.5

  	
  Notice of Defaults

  	
   

  
	
  SECTION
  6.6

  	
  Reports by Indenture Trustee to Noteholders

  	
   

  
	
  SECTION 6.7

  	
  Compensation and Indemnity

  	
   

  
	
  SECTION 6.8

  	
  Replacement of Indenture Trustee

  	
   

  
	
  SECTION 6.9

  	
  Successor Indenture Trustee by Merger

  	
   

  

 

ii

 

	
  SECTION
  6.10

  	
  Appointment of Co-Trustee or Separate
  Trustee.

  	
   

  
	
  SECTION 6.11

  	
  Eligibility; Disqualification

  	
   

  
	
  SECTION
  6.12

  	
  Preferential Collection of Claims Against the
  Issuer

  	
   

  
	
   

  	
   

  
	
  ARTICLE VII

  
	
  Noteholders’ Lists and Reports

  
	
   

  	
   

  
	
  SECTION
  7.1

  	
  Issuer to Furnish Indenture Trustee Names
  and Addresses of Noteholders

  	
   

  
	
  SECTION
  7.2

  	
  Preservation of Information; Communications
  to Noteholders

  	
   

  
	
  SECTION 7.3

  	
  Reports by Issuer.

  	
   

  
	
   

  	
   

  
	
  ARTICLE VIII

  
	
  Accounts, Disbursements and Releases

  
	
   

  	
   

  
	
  SECTION 8.1

  	
  Collection of Money

  	
   

  
	
  SECTION 8.2

  	
  Trust Accounts

  	
   

  
	
  SECTION
  8.3

  	
  General Provisions Regarding Accounts

  	
   

  
	
  SECTION 8.4

  	
  Release of Indenture Trust Estate

  	
   

  
	
  SECTION 8.5

  	
  Opinion of Counsel

  	
   

  
	
   

  	
   

  
	
  ARTICLE IX

  
	
  Supplemental Indentures

  
	
   

  	
   

  
	
  SECTION
  9.1

  	
  Supplemental Indentures Without Consent of
  Noteholders.

  	
   

  
	
  SECTION
  9.2

  	
  Supplemental Indentures with Consent of
  Noteholders.

  	
   

  
	
  SECTION 9.3

  	
  Execution of Supplemental Indentures

  	
   

  
	
  SECTION 9.4

  	
  Effect of Supplemental Indenture

  	
   

  
	
  SECTION 9.5

  	
  Conformity with Trust Indenture Act

  	
   

  
	
  SECTION
  9.6

  	
  Reference in Notes to Supplemental
  Indentures

  	
   

  
	
   

  	
   

  
	
  ARTICLE X

  
	
  Redemption of Notes

  
	
   

  	
   

  
	
  SECTION 10.1

  	
  Redemption

  	
   

  
	
  SECTION 10.2

  	
  Form of Redemption Notice

  	
   

  
	
  SECTION 10.3

  	
  Notes Payable on Redemption Date

  	
   

  
	
   

  	
   

  
	
  ARTICLE XI

  
	
  Miscellaneous

  
	
   

  	
   

  
	
  SECTION
  11.1

  	
  Compliance Certificates and Opinions, etc

  	
   

  
	
  SECTION
  11.2

  	
  Form of Documents Delivered to Indenture
  Trustee

  	
   

  
	
  SECTION 11.3

  	
  Acts of Noteholders

  	
   

  
	
  SECTION 11.4

  	
  Notices, etc., to Indenture Trustee, Issuer
  and Rating Agencies

  	
   

  
	
  SECTION 11.5

  	
  Notices to Noteholders; Waiver

  	
   

  
	
  SECTION
  11.6

  	
  Alternate Payment and Notice Provisions

  	
   

  
	
  SECTION 11.7

  	
  Conflict with Trust Indenture Act

  	
   

  

 

iii

 

	
  SECTION
  11.8

  	
  Effect of Headings and Table of Contents

  	
   

  
	
  SECTION 11.9

  	
  Successors and Assigns

  	
   

  
	
  SECTION 11.10

  	
  Separability

  	
   

  
	
  SECTION 11.11

  	
  Benefits of Indenture

  	
   

  
	
  SECTION 11.12

  	
  Legal Holidays

  	
   

  
	
  SECTION 11.13

  	
  Governing Law

  	
   

  
	
  SECTION 11.14

  	
  Counterparts

  	
   

  
	
  SECTION 11.15

  	
  Recording of Indenture

  	
   

  
	
  SECTION 11.16

  	
  Trust Obligations

  	
   

  
	
  SECTION 11.17

  	
  No Petition

  	
   

  
	
  SECTION 11.18

  	
  Inspection

  	
   

  
	
  SECTION 11.19

  	
  Subordination

  	
   

  

 

iv

 

APPENDICES, SCHEDULES AND EXHIBITS

 

	
  APPENDIX
  A-1

  	
  Definitions
  and Usage

  	
   

  
	
  APPENDIX
  A-2

  	
  Reset
  Rate Note Procedures

  	
   

  
	
  APPENDIX
  A-3

  	
  Transfer
  Restrictions for the Reset Rate Notes

  	
   

  
	
   

  	
   

  	
   

  
	
  SCHEDULE A

  	
  Schedule of Trust Student Loans

  	
   

  
	
  SCHEDULE B

  	
  Location of Trust Student Loan Files

  	
   

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
  Forms of Notes

  	
   

  
	
  EXHIBIT B

  	
  Form of Note Depository Agreement for U.S.
  Dollar Denominated Notes

  	
   

  
	
  EXHIBIT C

  	
  Form of Note Depository Agreement for Notes
  Denominated in a Currency Other than U.S. Dollars

  	
   

  

 

v

 

INDENTURE, dated as of August 1, 2004, among
SLM STUDENT LOAN TRUST 2004-8, a Delaware statutory trust (the “Issuer”), CHASE
MANHATTAN BANK USA, NATIONAL ASSOCIATION, a national banking association, not
in its individual capacity but solely as eligible lender trustee on behalf of
the Issuer (in such capacity, the “Eligible Lender Trustee”), and DEUTSCHE BANK
TRUST COMPANY AMERICAS, a New York banking corporation, not in its individual
capacity but solely as indenture trustee (in such capacity, the “Indenture
Trustee”).

 

Each party agrees as follows for the benefit
of the other party and for the equal and ratable benefit of the holders of the
Issuer’s Student Loan-Backed Notes (the “Notes”) and, after the Notes have been
paid in full, for the benefit of any Currency Swap Counterparty:

 

GRANTING CLAUSE

 

The Issuer and, with respect to the Trust
Student Loans, the Eligible Lender Trustee hereby Grant to the Indenture
Trustee, as trustee for the benefit of the Noteholders and, subject to the
provisions of Section 11.19, any Currency Swap Counterparty, effective as of
the Closing Date all of their right, title and interest in and to the
following:

 

(a)           the
Trust Student Loans, and all obligations of the Obligors thereunder including
all moneys accrued and paid thereunder on or after the Cutoff Date and all
guaranties and other rights relating to the Trust Student Loans;

 

(b)           the
Servicing Agreement, including the right of the Issuer to cause the Servicer to
purchase Trust Student Loans from the Issuer under circumstances described
therein;

 

(c)           the
Sale Agreement, including the right of the Issuer to cause the Depositor to
repurchase Trust Student Loans from the Issuer under the circumstances
described therein and including the rights of the Depositor under the Purchase
Agreement;

 

(d)           the
Purchase Agreement, to the extent that the rights of the Depositor thereunder
have been assigned to the Issuer pursuant to the Sale Agreement, including the
right of the Depositor to cause SLM ECFC to repurchase Trust Student Loans from
the Depositor under the circumstances described in the Purchase Agreement;

 

(e)           the
Administration Agreement, the Interest Rate Cap Agreement, the Remarketing
Agreement, the Initial Currency Swap Agreements and any other Swap Agreements
to be entered into from time to time and any agreement representing Eligible
Repurchase Obligations between the Trust and an Eligible Repo Counterparty to
be entered into from time to time;

 

(f)            each
Guarantee Agreement, including the right of the Issuer to cause the related
Guarantor to make Guarantee Payments in respect of the Trust Student Loans;

 

(g)           the
Trust Accounts and all funds on deposit from time to time in the Trust
Accounts, including the Reserve Account Initial Deposit, the Collection Account
Initial Deposit and the Capitalized Interest Account Initial Deposit, if any,
and all investments and proceeds thereof (including all income thereon); and

 

1

 

(h)           all
present and future claims, demands, causes and choses in action in respect of
any or all of the foregoing and all payments on or under and all proceeds of
every kind and nature whatsoever in respect of any or all of the foregoing,
including all proceeds of the conversion, voluntary or involuntary, into cash
or other liquid property, all cash proceeds, accounts, accounts receivable,
notes, drafts, acceptances, chattel paper, checks, general intangibles, deposit
accounts, insurance proceeds, condemnation awards, rights to payment of any and
every kind and other forms of obligations and receivables, instruments and
other property which at any time constitute all or part of or are included in
the proceeds of any of the foregoing (collectively, the “Collateral”).

 

The foregoing Grant is made in trust to
secure the payment of principal of and interest on, and any other amounts owing
in respect of, the Notes, equally and ratably without prejudice, priority or
distinction, to secure compliance with the provisions of this Indenture and,
subject to the provisions of Section 11.19, to secure amounts owing to any
Currency Swap Counterparty under the related Currency Swap Agreement, all as provided
in this Indenture.

 

The Indenture Trustee, as indenture trustee
on behalf of the Noteholders and each Currency Swap Counterparty, acknowledges
such Grant, accepts the trusts under this Indenture in accordance with the
provisions of this Indenture and agrees to perform its duties required in this
Indenture to the best of its ability to the end that the interests of the
Noteholders and each Currency Swap Counterparty under the related Currency Swap
Agreement may be adequately and effectively protected.

 

ARTICLE I

 

Definitions
and Usage

 

SECTION 1.1   Definitions
and Usage.  Except as otherwise
specified herein or as the context may otherwise require, capitalized terms
used but not otherwise defined herein are defined in Appendix A-1 to this
Indenture, which also contains rules as to usage that shall be applicable
herein.

 

SECTION 1.2   Incorporation
by Reference of Trust Indenture Act.  Whenever this Indenture refers to a provision of the TIA, the
provision is incorporated by reference in and made a part of this
Indenture.  The following TIA terms used
in this Indenture have the following meanings:

 

“Commission” means the Securities and
Exchange Commission.

 

“indenture securities” means the Notes.

 

“indenture security holder” means a
Noteholder.

 

“indenture to be qualified” means this
Indenture.

 

“indenture trustee” or “institutional
trustee” means the Indenture Trustee.

 

2

 

“obligor” on the indenture securities means
the Issuer and any other obligor on the indenture securities.

 

All other TIA terms used in this Indenture
that are defined by the TIA, defined by TIA reference to another statute or
defined by Commission rule have the meaning assigned to them by such
definitions.

 

ARTICLE II

 

The Notes

 

SECTION 2.1   Form.  The Notes, together with the Indenture
Trustee’s certificate of authentication, shall be in substantially the forms
set forth in Exhibit A, with such appropriate insertions, omissions,
substitutions and other variations as are required or permitted by this
Indenture and may have such letters, numbers or other marks of identification
and such legends or endorsements placed thereon as may, consistently herewith,
be determined by the officers executing the Notes, as evidenced by their
execution of the Notes.  Any portion of
the text of any Note may be set forth on the reverse thereof, with an
appropriate reference thereto on the face of the Note.

 

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

 

The terms of the Notes set forth in Exhibit A
are part of the terms of this Indenture.

 

Each class of Floating Rate Notes will be
represented by interests in a book-entry note certificate deposited on the
Closing Date with Deutsche Bank Trust Company Americas, as custodian for DTC
(the “DTC Custodian”), and registered in the name of Cede & Co. as
initial nominee for DTC.

 

Each class of Reset Rate Notes denominated in
a currency other than U.S. Dollars may be offered and sold only to QIBs in
reliance on Rule 144A or to a non-U.S. Person (as defined in Regulation S)
outside the United States of America in reliance on Regulation S, as applicable
and will be represented by interests in either a Rule 144A global registered
note certificate (the “Non-U.S. Rule 144A Global Note Certificate”) or a
Regulation S global registered note certificate (the “Regulation S Global Note
Certificate,” and collectively with the Non-U.S. Rule 144A Global Note
Certificate, the “Non-U.S. Global Note Certificates”).  On the Closing Date, the entire Outstanding
Amount of each class of Reset Rate Notes will be allocated between the
corresponding Non-U.S. Rule 144A Global Note Certificate and Regulation S
Global Note Certificate, as applicable. 
Each Non-U.S. Global Note Certificate will be registered in the name of
the Joint Nominee, and will be deposited on the Closing Date with the
Regulation S Custodian.  There will be
only one Non-U.S. Rule 144A Global Note Certificate and one Regulation S Global
Note Certificate for each class of Reset Rate Notes.  On the Closing Date, with respect to each class of Reset Rate
Notes, a corresponding U.S. Rule 144A Global Note Certificate will be deposited
with the DTC Custodian and will have an outstanding principal

 

3

 

balance of
zero for so long as such class of Reset Rate Notes is denominated in a currency
other than U.S. Dollars.

 

Each class of Reset Rate Notes denominated in
U.S. Dollars may be offered and sold only to QIBs in reliance on Rule 144A or
to a non-U.S. Person (as defined in Regulation S) outside the United States in
reliance on Regulation S, as applicable, and the entire outstanding principal
balance of each class of Reset Rate Notes will be allocated between a global
registered note certificate (the “U.S. Rule 144A Global Note Certificate”, and,
together with the Non-U.S. Global Note Certificates, the “Global Note
Certificates”), deposited with the DTC Custodian and registered in the name of
Cede & Co. as initial nominee for DTC, the Non-U.S. Rule 144A Global
Note Certificate and the Regulation S Global Note Certificate.  Transfers of interest among the U.S. Rule
144A Global Note Certificate, the Non-U.S. Rule 144A Global Note Certificate
and the Regulation S Global Note Certificate on any date (other than a Reset
Date) when the related class of Reset Rate Notes is then denominated in U.S.
Dollars will be governed by the usual and customary rules and regulations
applicable to DTC, Euroclear and Clearstream, as applicable.

 

At all times during any Reset Period when a
class of Reset Notes is to be denominated in a currency other than U.S.
Dollars, the aggregate Outstanding Amount of such class of Reset Rate Notes
will be allocated between the corresponding Non-U.S. Rule 144A Global Note
Certificate and Regulation S Global Note Certificate, either of which may, from
time to time during the related Reset Period, represent between zero and 100%
of the Outstanding Amount of such class of Reset Rate Notes and the
corresponding U.S. Rule 144A Global Note Certificate will have an outstanding
principal balance of zero.  At all times
during any Reset Period when a class of Reset Rate Notes is to be denominated
in U.S. Dollars, the aggregate Outstanding Amount of such class of Reset Rate
Notes will be allocated among the three Global Note Certificates, any of which
may, from time to time during the related Reset Period, represent between zero
and 100% of the Outstanding Amount of such class of Reset Rate Notes.

 

SECTION 2.2   Execution,
Authentication and Delivery. 
The Notes shall be executed on behalf of the Issuer by any of its
Authorized Officers.  The signature of
any such Authorized Officer on the Notes may be manual or facsimile.

 

Notes bearing the manual or facsimile
signature of individuals who were at any time Authorized Officers of the Issuer
shall bind the Issuer, notwithstanding that such individuals or any of them
have ceased to hold such offices prior to the authentication and delivery of
such Notes or did not hold such offices at the date of such Notes.

 

The Indenture Trustee shall upon Issuer Order
authenticate and deliver the Floating Rate Notes and the U.S. Rule 144A Global
Note Certificates for original issue in an aggregate principal amount of
$1,239,035,000, and the London Paying Agent, which is hereby appointed as
authenticating agent (the “Authenticating Agent”), shall upon Issuer order
authenticate and deliver the Non-U.S. Global Note Certificates for original
issue in the aggregate principal amount of €820,000,000.  The aggregate principal amount of Notes
Outstanding at any time may not exceed such amount except as provided in
Section 2.5.  On each Spread

 

4

 

Determination
Date, upon receipt of an Issuer Order, the Indenture Trustee shall deliver a
revised Schedule A for the Reset Rate Notes to the Custodians.

 

Each Note shall be dated the date of its
authentication.  The Floating Rate
Class A Notes shall be issuable as registered notes in minimum
denominations of $10,000 and additional increments of $1,000.  The Class B Notes shall be issuable as
registered notes in minimum denominations of $100,000 and additional increments
of $1,000.

 

During any Reset Period when a class of Reset
Rate Notes is denominated in U.S. Dollars, such Reset Rate Notes shall be
issued in minimum denominations of $250,000, and additional increments of
$1.  During any Reset Period when a
class of Reset Rate Notes is denominated in a currency other than U.S. Dollars,
such Reset Rate Notes shall be issued in minimum denominations of the
applicable currency equivalent (approximately) of $250,000 and additional
increments of the applicable currency equivalent of $1 (which shall be
determined by reference to the exchange rate to be set forth in the related
Currency Swap Agreement); provided, that during any Reset Period when a
class of Reset Rate Notes is denominated in Pounds Sterling, such Reset Rate
Notes shall be issued in minimum denominations of £100,000 and additional
increments of £1; and provided, further, that during any Reset Period
when a class of Reset Rate Notes is denominated in Euros, such Reset Rate Notes
shall be issued in minimum denominations of €100,000 and additional increments
of €1.

 

No Note shall be entitled to any benefit
under this Indenture or be valid or obligatory for any purpose, unless there
appears on such Note a certificate of authentication substantially in the form
provided for herein executed by the Indenture Trustee by the manual signature
of one of its authorized signatories, and such certificate upon any Note shall
be conclusive evidence, and the only evidence, that such Note has been duly
authenticated and delivered hereunder.

 

SECTION 2.3   Temporary Notes.  Pending the preparation of Definitive Notes,
the Issuer may execute, and upon receipt of an Issuer Order the Indenture
Trustee shall authenticate and deliver, temporary Notes which are printed,
lithographed, typewritten, mimeographed or otherwise produced, of the tenor of
the Definitive Notes in lieu of which they are issued and with such variations
not inconsistent with the terms of this Indenture determined to be appropriate
by the Responsible Officer of the Issuer executing the temporary Notes, as
evidenced by his or her execution of such temporary Notes.

 

If temporary Notes are issued, the Issuer
will cause Definitive Notes to be prepared without unreasonable delay.  After the preparation of Definitive Notes,
the temporary Notes shall be exchangeable for Definitive Notes upon surrender
of the temporary Notes at the office or agency of the Issuer to be maintained
as provided in Section 3.2, without charge to the Noteholder.  Upon surrender for cancellation of any one
or more temporary Notes, the Issuer shall execute and the Indenture Trustee
shall authenticate and deliver in exchange therefor a like principal amount of
Definitive Notes of authorized denominations. 
Until so exchanged, the temporary Notes shall in all respects be
entitled to the same benefits under this Indenture as Definitive Notes.

 

5

 

SECTION 2.4   Registration;
Registration of Transfer and Exchange.  The Issuer shall cause to be kept a register
(the “Note Register”) in which, subject to such reasonable regulations as it
may prescribe, the Issuer shall provide for the registration of Notes and the
registration of transfers of Notes.  The
Indenture Trustee shall be “Note Registrar” for the purpose of registering
Notes and transfers of Notes as herein provided.  Upon any resignation of any Note Registrar, the Issuer shall
promptly appoint a successor or, if it elects not to make such an appointment,
assume the duties of Note Registrar.

 

If a Person other than the Indenture Trustee
is appointed by the Issuer as Note Registrar, the Issuer shall give the
Indenture Trustee prompt written notice of the appointment of such Note
Registrar and of the location, and any change in the location, of the Note
Register, and the Indenture Trustee shall have the right to inspect the Note
Register at all reasonable times and to obtain copies thereof, and the
Indenture Trustee shall have the right to rely upon a certificate executed on
behalf of the Note Registrar by an Executive Officer thereof as to the names
and addresses of the Noteholders and the principal amounts and number of such
Notes.

 

Upon surrender for registration of transfer
of any Note at the office or agency of the Issuer to be maintained as provided
in Section 3.2 or, with respect to the Reset Rate Notes, to the Note Registrar
or any transfer agent, as applicable, if the requirements of Section 8-401(1)
of the UCC are met, the Issuer shall execute, and the Indenture Trustee shall
authenticate and the Noteholder shall obtain from the Indenture Trustee, in the
name of the designated transferee or transferees, one or more new Notes in any
authorized denominations and a like aggregate principal amount.

 

On each Reset Date on which either the All
Hold Rate is not applicable or fewer than 100% of a class of Reset Rate
Noteholders permissibly elect to hold their Reset Rate Notes, the Indenture
Trustee shall allocate the aggregate Outstanding Amount of such class of Reset
Rate Notes, if such class of Reset Rate Notes is to be denominated in U.S.
Dollars during the immediately following Reset Period, to the Global Note
Certificates, any of which may, from time to time during the related Reset
Period, represent between zero and 100% of the Outstanding Amount of such Reset
Rate Notes.  On any Reset Date when a
class of Reset Rate Notes is to be denominated in a currency other than U.S.
Dollars during the immediately following Reset Period, the Outstanding Amount
of such class of Reset Rate Notes shall be allocated entirely to the Non-U.S.
Global Note Certificates, as applicable, and the corresponding U.S. Rule 144A
Global Certificate will have an outstanding principal balance of zero.  Any transfer of a class of Reset Rate Notes
when such class is denominated in a non-U.S. Dollar Currency (other than on a
Reset Date) between the related U.S. Rule 144A Global Note Certificate and the
related Non-U.S. Global Note Certificates is not permitted and any attempt or
inadvertent transfer shall be null and void and of no effect.

 

At the option of the Noteholder, Notes may be
exchanged for other Notes in any authorized denominations and a like aggregate
principal amount, upon surrender of the Notes to be exchanged at such office or
agency.  Whenever any Notes are so
surrendered for exchange, the Issuer shall execute, and the Indenture Trustee
shall authenticate and the Noteholder shall obtain from the Indenture Trustee,
the Notes which the Noteholder making the exchange is entitled to receive.

 

6

 

All Notes issued upon any registration of
transfer or exchange of Notes shall be the valid obligations of the Issuer,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Notes surrendered upon such registration of transfer or
exchange.

 

Every Note presented or surrendered for
registration of transfer or exchange shall be duly endorsed by, or be
accompanied by a written instrument of transfer in form satisfactory to the
Indenture Trustee duly executed by the Noteholder thereof or such Noteholder’s
attorney duly authorized in writing, with such signature guaranteed by an
“eligible guarantor institution” meeting the requirements of the Note
Registrar, which requirements include membership or participation in Securities
Transfer Agent’s Medallion Program (“STAMP”) or such other “signature guarantee
program” as may be determined by the Note Registrar in addition to, or in
substitution for, STAMP, all in accordance with the Exchange Act.

 

No service charge shall be made to a
Noteholder for any registration of transfer or exchange of Notes, but the
Indenture Trustee may require payment of a sum sufficient to cover any tax or
other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Notes, other than exchanges pursuant to
Section 2.3 or 9.6 not involving any transfer.

 

The preceding provisions of this Section
notwithstanding, the Issuer shall not be required to make and the Note
Registrar need not register transfers or exchanges of Notes selected for
redemption or of any Note for a period of 15 days preceding the due date for
any payment with respect to the Note.

 

Any transfer or assignment of any Note or any
interest in any Note that is not effected pursuant to the provisions of this
Indenture (including, without limitation, this Section 2.4, Section 2.13 and
Appendix A-3 to this Indenture), such as a transfer or assignment not reflected
on the Note Register, shall be null and void and shall not be taken into
account by, or be binding upon, the Indenture Trustee or any other party.

 

SECTION 2.5   Mutilated,
Destroyed, Lost or Stolen Notes.  If (i) any mutilated Note is surrendered to the Indenture
Trustee, or the Indenture Trustee receives evidence to its satisfaction of the
destruction, loss or theft of any Note, and (ii) there is delivered to the
Issuer and the Indenture Trustee such security or indemnity as may be required
by each of them to hold the Issuer and the Indenture Trustee harmless, then, in
the absence of notice to the Issuer, the Note Registrar or the Indenture
Trustee that such Note has been acquired by a bona fide purchaser, and provided
that the requirements of Section 8-405 of the UCC are met, the Issuer shall execute
and upon its request the Indenture Trustee shall authenticate and deliver, in
exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note,
a replacement Note; provided, however, that if any such
destroyed, lost or stolen Note, but not a mutilated Note, shall have become or
within 15 days shall be due and payable, or shall have been called for
redemption, instead of issuing a replacement Note, the Issuer may pay such
destroyed, lost or stolen Note when so due or payable or upon the Redemption
Date without surrender thereof.  If,
after the delivery of such replacement Note or payment of a destroyed, lost or
stolen Note pursuant to the proviso to the preceding sentence, a bona fide
purchaser of the original Note in lieu of which such replacement Note was
issued presents for payment such original Note, the Issuer and the Indenture
Trustee shall be entitled to recover such replacement Note (or such

 

7

 

payment) from the Person to whom it was
delivered or any Person taking such replacement Note from such Person to whom
such replacement Note was delivered or any assignee of such Person, except a
bona fide purchaser, and shall be entitled to recover upon the security or
indemnity provided therefor to the extent of any loss, damage, cost or expense
incurred by the Issuer or the Indenture Trustee in connection therewith.

 

Upon the issuance of any replacement Note
under this Section, the Issuer may require the payment by the Noteholder
thereof of a sum sufficient to cover any tax or other governmental charge that
may be imposed in relation thereto and any other reasonable expenses (including
the fees and expenses of the Indenture Trustee) connected therewith.

 

Every replacement Note issued pursuant to
this Section in replacement of any mutilated, destroyed, lost or stolen Note
shall constitute an original additional contractual obligation of the Issuer,
whether or not the mutilated, destroyed, lost or stolen Note shall be at any
time enforceable by anyone, and shall be entitled to all the benefits of this
Indenture equally and proportionately with any and all other Notes duly issued
hereunder.

 

The provisions of this Section are exclusive
and shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or stolen
Notes.

 

SECTION 2.6   Persons Deemed
Owner.  Prior to due presentment
for registration of transfer of any Note, the Issuer, the Indenture Trustee and
any agent of the Issuer or the Indenture Trustee may treat the Person in whose
name any Note is registered (as of the day of determination) as the owner of
such Note for the purpose of receiving payments of principal of, interest, if
any, on such Note and for all other purposes whatsoever, whether or not such
Note be overdue, and neither the Issuer, the Indenture Trustee nor any agent of
the Issuer or the Indenture Trustee shall be affected by notice to the
contrary.

 

SECTION 2.7   Payment
of Principal and Interest; Note Interest Shortfall.  (a)  The Floating Rate Notes shall
accrue interest as provided in such Floating Rate Notes, which shall be
substantially in the form of Exhibits A-1, A-2, A-3, A-4 and A-11 and each
class of Reset Rate Notes shall accrue interest as provided in such Reset Rate
Notes, which shall be substantially in the form of Exhibit A-5, A-6, A-7, A-8,
A-9 or A-10, and such interest shall be payable on each applicable Distribution
Date as specified therein, subject to Section 3.1.  Any installment of interest or principal, if any, payable on any
Note which is punctually paid or duly provided for by the Issuer on the
applicable Distribution Date shall be paid to the Person in whose name such
Note (or one or more Predecessor Notes) is registered on the applicable Record
Date by check mailed first-class, postage prepaid to such Person’s address as
it appears on the Note Register on such Record Date, except that, unless
Definitive Notes have been issued pursuant to Section 2.12, with respect
to Notes registered on the Record Date in the name of the nominee of the
applicable Clearing Agency, for the Notes, payment shall be made by wire
transfer in immediately available funds to the account designated by such
nominee and except for the final installment of principal payable with respect
to such Note on a Distribution Date or on the Note Final Maturity Date for such
Note which shall be payable as provided below. 
The funds represented by any such checks returned undelivered shall be
held in accordance with Section 3.3.

 

8

 

(b)           The
principal amount of each class of Floating Rate Notes shall be payable in
installments on each applicable Distribution Date as provided in the forms of
Notes set forth in Exhibits A-1, A-2, A-3, A-4 and A-11 and the principal
amount of each class of Reset Rate Notes shall be payable on each applicable
Distribution Date as set forth in Exhibit A-5, A-6, A-7, A-8, A-9 or A-10 and
in Appendix A-2 to this Indenture. 
Notwithstanding the foregoing, the entire unpaid principal amount of
each class of the Notes shall be due and payable, if not previously paid, on
the Note Final Maturity Date for such class of Notes and on the date on which
an Event of Default shall have occurred and be continuing if the Indenture
Trustee or the Noteholders of the Notes representing at least a majority of the
Outstanding Amount of the Notes have declared the Notes to be immediately due
and payable in the manner provided in Section 5.2.  All principal payments on the Notes shall be made pro rata to the
specific class of Noteholders entitled thereto.  The Indenture Trustee shall notify the Person in whose name a
Note is registered at the close of business on the Record Date preceding the
Distribution Date on which the Issuer expects that the final installment of
principal of and interest on such Note will be paid.  Such notice shall be mailed or transmitted by facsimile prior to
such final Distribution Date and shall specify that such final installment will
be payable only upon presentation and surrender of such Note and shall specify
the place where such Note may be presented and surrendered for payment of such
installment.  Notices in connection with
redemptions of Notes shall be mailed to Noteholders as provided in Section
10.2.

 

(c)           If
the Issuer defaults in a payment of interest at the applicable Note Rate on the
Notes, the Issuer shall pay the resulting Note Interest Shortfall on the
following Distribution Date as provided in the Administration Agreement.

 

SECTION 2.8   Cancellation.  All Notes surrendered for payment,
registration of transfer, exchange or redemption shall, if surrendered to any
Person other than the Indenture Trustee, be delivered to the Indenture Trustee
and shall be promptly cancelled by the Indenture Trustee.  The Issuer may at any time deliver to the
Indenture Trustee for cancellation any Notes previously authenticated and
delivered hereunder which the Issuer may have acquired in any manner whatsoever
and all Notes so delivered shall be promptly cancelled by the Indenture
Trustee.  No Notes shall be
authenticated in lieu of or in exchange for any Notes cancelled as provided in
this Section, except as expressly permitted by this Indenture.  All canceled Notes may be held or disposed
of by the Indenture Trustee in accordance with its standard retention or
disposal policy as in effect at the time, unless the Issuer shall direct by an
Issuer Order that they be returned to it and so long as such Issuer Order is
timely and the Notes have not been previously disposed of by the Indenture
Trustee.

 

SECTION 2.9   Release of
Collateral.   Subject to
Sections 3.1(b) and 11.19 and the terms of the Basic Documents, the Indenture
Trustee shall release property from the lien of this Indenture only upon
receipt of an Issuer Request accompanied by an Officers’ Certificate of the
Issuer, an Opinion of Counsel and Independent Certificates in accordance with
TIA §§ 314(c) and 314(d)(1) or an Opinion of Counsel in lieu of such
Independent Certificates to the effect that the TIA does not require any such
Independent Certificates.

 

SECTION 2.10   Book-Entry Notes.  The Notes, upon original issuance, will be
issued in the form of typewritten Notes representing the Book-Entry Notes, to
be delivered to the applicable initial Clearing Agency by the Issuer, or by the
Indenture Trustee on behalf of the

 

9

 

Issuer. 
Such Notes shall initially be registered on the Note Register in the
name of the nominee of each initial Clearing Agency, and no Note Owner shall
receive a definitive, fully registered note (a “Definitive Note”) representing
such Note Owner’s interest in such Note, except as provided in Section
2.12.  Unless and until Definitive Notes
have been issued to Note Owners pursuant to Section 2.12:

 

(i)            the provisions of this
Section shall be in full force and effect;

 

(ii)           the Note Registrar and
the Indenture Trustee, and their respective directors, officers, employees and
agents, may deal with the applicable Clearing Agency for all purposes
(including the payment of principal of and interest and other amounts on the
Notes) as the authorized representative of the Note Owners;

 

(iii)          to the extent that the
provisions of this Section conflict with any other provisions of this Indenture,
the provisions of this Section shall control;

 

(iv)          the rights of Note
Owners shall be exercised only through the applicable Clearing Agency and shall
be limited to those established by law and agreements between such Note Owners
and the applicable Clearing Agency and/or the applicable Clearing Agency
Participants pursuant to the Note Depository Agreements; and unless and until
Definitive Notes are issued pursuant to Section 2.12, the applicable initial
Clearing Agency will make book-entry transfers among the applicable Clearing
Agency Participants and receive and transmit payments of principal of and
interest and other amounts on the Notes to such applicable Clearing Agency
Participants;

 

(v)           whenever this Indenture
requires or permits actions to be taken based upon instructions or directions
of Noteholders of Notes evidencing a specified percentage of the Outstanding
Amount of the Notes, the applicable Clearing Agency shall be deemed to
represent such percentage only to the extent that it has received instructions
to such effect from Note Owners and/or applicable Clearing Agency Participants
owning or representing, respectively, such required percentage of the
beneficial interest in the Notes and has delivered such instructions to the
Indenture Trustee; and

 

(vi)          upon acquisition or
transfer of a beneficial interest in any Book-Entry Note by, for or with the
assets of, a Benefit Plan, such Note Owner shall be deemed to have represented
that such acquisition or purchase will not constitute or otherwise result in:
(i) in the case of a Benefit Plan subject to Title I of ERISA or Section 4975
of the Code, a non-exempt prohibited transaction in violation of Section 406 of
ERISA or Section 4975 of the Code which is not covered by a class or other
applicable exemption and (ii) in the case of a Benefit Plan subject to a
substantially similar federal, state, local or foreign law, a non-exempt
violation of such substantially similar law. 
Any transfer found to have been made in violation of such deemed
representation shall be null and void and of no effect.

 

SECTION 2.11   Notices
to Clearing Agency.  Whenever a
notice or other communication is required under this Indenture to be given to
Noteholders, unless and until Definitive Notes shall have been issued to Note Owners
pursuant to Section 2.12, the Indenture

 

10

 

Trustee shall give all such notices and
communications specified herein to the applicable Clearing Agency.

 

SECTION 2.12   Definitive Notes.  If (i) the Administrator advises the
Indenture Trustee in writing that a Clearing Agency (a) is closed for
business for a continuous period of 14 days (other than by reason of holiday,
statutory or otherwise), (b) announces an intention to cease business permanently
(or does so and no alternative clearing system acceptable to the Indenture
Trustee is then available), or (c) at any time, is unwilling or unable to
continue as, or ceases to be, a clearing agency registered under all applicable
laws, and a successor clearing agency which is registered as a clearing agency
under all applicable laws is not appointed by the Administrator within 90 days
of such event, (ii) the Administrator at its option advises the Indenture
Trustee in writing that it elects to terminate the book-entry system through
that Clearing Agency or (iii) after the occurrence of an Event of Default, a
Servicer Default or an Administrator Default, Note Owners representing
beneficial interests aggregating at least a majority of the Outstanding Amount
of the applicable Notes advise the applicable Clearing Agency (which shall then
notify the Indenture Trustee) in writing that the continuation of a book-entry
system through such Clearing Agency is no longer in the best interests of such
Note Owners, then the Indenture Trustee shall cause such Clearing Agency to
notify all Note Owners cleared, through such Clearing Agency, of the occurrence
of any such event and of the availability of Definitive Notes to Note Owners
requesting the same.  Upon surrender to
the Indenture Trustee of the typewritten Notes representing the Book-Entry
Notes by a Clearing Agency, accompanied by registration instructions, the
Issuer shall execute and the Indenture Trustee shall authenticate the
Definitive Notes in accordance with the instructions of such Clearing Agency,
which shall include, without limitation, the identity and payment instructions
for all Noteholders of the applicable Notes. 
None of the Issuer, the Note Registrar or the Indenture Trustee shall be
liable for any delay in delivery of such instructions and may conclusively rely
on, and shall be protected in relying on, such instructions.  Upon the issuance of Definitive Notes, the
Indenture Trustee shall recognize the holders of the Definitive Notes as
Noteholders.

 

Upon acquisition or transfer of a Definitive
Note by, for or with the assets of, a Plan, such Note Owner shall be deemed to
have represented that such acquisition or purchase will not constitute or
otherwise result in: (i) in the case of a Plan subject to Section 406 of ERISA
or Section 4975 of the Code, a non-exempt prohibited transaction in violation
of Section 406 of ERISA or Section 4975 of the Code which is not covered by a
class or other applicable exemption and (ii) in the case of a Plan subject to a
substantially similar law, a non-exempt violation of such substantially similar
law.  Any transfer found to have been
made in violation of such deemed representation shall be null and void and of
no effect.

 

SECTION 2.13   Transfer
Restrictions.  Each Noteholder and
Note Owner of a Reset Rate Note shall be subject to the restrictions on
transfer thereof set forth in Appendix A-3 to this Indenture.

 

11

 

ARTICLE III

 

Covenants

 

SECTION 3.1   Payments
to Noteholders and each Swap Counterparty.  The Issuer shall duly and punctually pay the
principal and interest, if any, with respect to the Notes in accordance with
the terms of the Notes and this Indenture and shall duly and punctually pay
amounts, if any, owing to each Swap Counterparty in accordance with the terms
of this Indenture and the related Swap Agreement.  Without limiting the foregoing, the Issuer shall cause to be
distributed to Noteholders and each Swap Counterparty in accordance with the
Administration Agreement that portion of the amounts on deposit in the Trust
Accounts on a Distribution Date or with respect to any Swap Counterparty
amounts on deposit in the relevant Trust Accounts on the date such payment is
due under the related Swap Agreement, which the Noteholders and any Swap
Counterparty are entitled to receive pursuant to Sections 2.7 and 2.8 of the
Administration Agreement.  Amounts
properly withheld under the Code by any Person from a payment to any Noteholder
of interest and/or principal shall be considered as having been paid by the
Issuer to such Noteholder for all purposes of this Indenture.

 

SECTION 3.1A   Collateral
Account.  In the event that
pursuant to the terms of an applicable Swap Agreement, a related Swap
Counterparty (or its credit support provider) is required to deposit cash or
securities as collateral to secure its obligations (“Swap Collateral”), the
Indenture Trustee shall establish and maintain one or more Eligible Deposit
Accounts in the name of the Indenture Trustee for the benefit of the Issuer and
such Swap Counterparty (each a “Swap Agreement Collateral Account”).  All sums on deposit and securities held in
any Swap Agreement Collateral Account shall be used only for the purposes set
forth in the related credit support agreement to be entered into between the
Trust and the related Swap Counterparty (a “Credit Support Agreement”).  Amounts on deposit in any Swap Agreement
Collateral Account may be invested in Eligible Investments at the written
direction of the related Swap Counterparty and on each Distribution Date, all
Investment Earnings actually received by the Indenture Trustee on amounts on
deposit in a Swap Agreement Collateral Account or on securities held by the
Indenture Trustee as Swap Collateral shall be paid directly to the related Swap
Counterparty and not become part of Available Funds in accordance with the
terms of the Credit Support Agreement. 
All amounts deposited in a Swap Agreement Collateral Account shall be
paid to the Issuer (and become part of Available Funds on the related
Distribution Date) or returned to the related Swap Counterparty, from time to
time, in accordance with the provisions set forth in the related Credit Support
Agreement.

 

SECTION 3.2   Maintenance
of Office or Agency.  The Issuer
shall maintain in the Borough of Manhattan, The City of New York and in
Luxembourg, so long as any of the Notes are listed on the Luxembourg Stock
Exchange and the rules of such exchange so require, or in such other
jurisdiction if any of the Notes are listed on another stock exchange of
international standing and the rules of such other exchange so require, an
office or agency where Notes may be surrendered for registration of transfer or
exchange, and where notices and demands to or upon the Issuer in respect of the
Notes and this Indenture may be served. 
The Issuer hereby initially appoints the Indenture Trustee to serve as
its agent for the foregoing purposes. 
The Issuer shall give prompt written notice to the Indenture Trustee of
the location, and of any change in the location, of any such office or
agency.  If at any time the Issuer shall

 

12

 

fail to maintain any such office or agency or
shall fail to furnish the Indenture Trustee with the address thereof, such
surrenders, notices and demands may be made or served at the Corporate Trust
Office, and the Issuer hereby appoints the Indenture Trustee as its agent to
receive all such surrenders, notices and demands.

 

SECTION 3.3   Money
for Payments to be Held in Trust. 
As provided in Section 8.2(a) and (b), all payments of amounts due and
payable with respect to any Notes or any Swap Agreement that are to be made
from amounts distributed from the Collection Account or any other Trust Account
pursuant to Sections 2.7 and 2.8 of the Administration Agreement shall be made
on behalf of the Issuer by the Indenture Trustee or by another Paying Agent,
and no amounts so distributed from the Collection Account for payments to
Noteholders or any Swap Counterparty shall be paid over to the Issuer except as
provided in this Section.

 

On or before the Business Day next preceding
each Distribution Date and Redemption Date, the Issuer shall distribute or
cause to be distributed to the Indenture Trustee (or any other Paying Agent) an
aggregate sum sufficient to pay the amounts then becoming due under the Notes
or any Swap Agreement, such sum to be held in trust for the benefit of the
Persons entitled thereto and (unless the Paying Agent is the Indenture Trustee)
shall promptly notify the Indenture Trustee of its action or failure so to act.

 

The Issuer shall cause each Paying Agent
other than the Indenture Trustee to execute and deliver to the Indenture
Trustee an instrument in which such Paying Agent shall agree with the Indenture
Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so
agrees), subject to the provisions of this Section, that such Paying Agent
will:

 

(i)            hold all sums held by
it for the payment of amounts due with respect to the Notes or any Swap Agreement
in trust for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided and pay
such sums to such Persons as herein provided;

 

(ii)           give the Indenture
Trustee notice of any default by the Issuer of which it has actual knowledge
(or any other obligor upon the Notes) in the making of any payment required to
be made with respect to the Notes or any Swap Agreement;

 

(iii)          at any time during the
continuance of any such default, upon the written request of the Indenture
Trustee, forthwith pay to the Indenture Trustee all sums so held in trust by
such Paying Agent;

 

(iv)          immediately resign as a
Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in
trust for the payments due under the Notes or any Swap Agreement if at any time
it ceases to meet the standards required to be met by a Paying Agent at the
time of its appointment; and

 

(v)           comply with all
requirements of the Code with respect to the withholding from any payments made
by it on any Notes of any applicable withholding taxes imposed thereon and with
respect to any applicable reporting requirements in connection therewith.

 

13

 

The Issuer may at any time, for the purpose
of obtaining the satisfaction and discharge of this Indenture or for any other
purpose, by Issuer Order direct any Paying Agent to pay to the Indenture
Trustee all sums held in trust by such Paying Agent, such sums to be held by
the Indenture Trustee upon the same trusts as those upon which the sums were
held by such Paying Agent; and upon such payment by any Paying Agent to the
Indenture Trustee, such Paying Agent shall be released from all further
liability with respect to such money.

 

Subject to applicable laws with respect to
escheat of funds, any money held by the Indenture Trustee or any Paying Agent
in trust for the payment of any amount due with respect to any Note and
remaining unclaimed for two years after such amount has become due and payable
shall be discharged from such trust and be paid to the Issuer on Issuer Request
or if the Issuer has been terminated to the Depositor upon its written request;
and the Noteholder thereof shall thereafter, as an unsecured general creditor,
look only to the Issuer for payment thereof (but only to the extent of the
amounts so paid to the Issuer), and all liability of the Indenture Trustee or
such Paying Agent with respect to such trust money shall thereupon cease; provided,
however, that the Indenture Trustee or such Paying Agent, before being
required to make any such repayment, shall at the expense and direction of the
Issuer cause to be published once, in a newspaper published in the English
language, customarily published on each Business Day and of general circulation
in The City of New York and in Luxembourg, so long as any of the Notes are
listed on the Luxembourg Stock Exchange and the rules of such Exchange so
require, or in such other jurisdiction if any of the Notes are listed on
another stock exchange of international standing and the rules of such other
exchange so require, notice that such money remains unclaimed and that, after a
date specified therein, which shall not be less than 30 days from the date of
such publication, any unclaimed balance of such money then remaining will be
repaid to the Issuer.  The Indenture
Trustee shall also adopt and employ, at the expense of the Issuer, any other
reasonable means of notification of such repayment (including mailing notice of
such repayment to Noteholders whose Notes have been called but have not been
surrendered for redemption or whose right to or interest in moneys due and
payable but not claimed is determinable from the records of the Indenture
Trustee or of any Paying Agent, at the last address of record for each such
Noteholder).

 

SECTION 3.4   Existence.  The Issuer shall keep in full effect its
existence, rights and franchises as a statutory trust under the laws of the
State of Delaware (unless it becomes, or any successor Issuer hereunder is or
becomes, organized under the laws of any other State or of the United States of
America, in which case the Issuer shall keep in full effect its existence,
rights and franchises under the laws of such other jurisdiction) and shall
obtain and preserve its qualification to do business in each jurisdiction in
which such qualification is or shall be necessary to protect the validity and
enforceability of this Indenture, the Notes, the Collateral and each other
instrument or agreement included in the Indenture Trust Estate.

 

SECTION 3.5   Protection
of Indenture Trust Estate.  The
Issuer will from time to time execute and deliver all such supplements and
amendments hereto, all such financing statements and continuation statements
and will take such other action necessary or advisable to:

 

(i)            maintain or preserve
the lien and security interest (and the priority thereof) of this Indenture or
carry out more effectively the purposes hereof;

 

14

 

(ii)           perfect, publish notice
of or protect the validity of any grant made or to be made by this Indenture;

 

(iii)          enforce any of the
Collateral; or

 

(iv)          preserve and defend
title to the Indenture Trust Estate and the rights of the Indenture Trustee,
the Noteholders and each Swap Counterparty in such Indenture Trust Estate
against the claims of all persons and parties.

 

The Issuer hereby designates the Indenture
Trustee its agent and attorney-in-fact to execute any financing statement,
continuation statement or other instrument required to be executed pursuant to
this Section.

 

SECTION 3.6   Opinions
as to Indenture Trust Estate. 
(a)  On the Closing Date, the Issuer shall furnish to the
Indenture Trustee 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 as is 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 December 31 in each calendar year, beginning in 2004, the Issuer
shall furnish to the Indenture Trustee 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 and any
indentures supplemental hereto as is necessary to maintain the lien and
security interest created by this Indenture and relating 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, recording and refiling of this Indenture and any
indentures supplemental hereto that will, in the opinion of such counsel, be
required to maintain the lien and security interest of this Indenture until
December 31 in the following calendar year.

 

SECTION 3.7   Performance
of Obligations; Servicing of Trust Student Loans.  (a)  The Issuer will not take any
action and will use its best efforts not to permit any action to be taken by
others that would release any Person from any of such Person’s material
covenants or obligations under any instrument or agreement included in the
Indenture Trust Estate or that would result in the amendment, hypothecation,
subordination, termination or discharge of, or impair the validity or
effectiveness of, any such instrument or agreement, except as expressly
provided in this Indenture, any other Basic Document or such other instrument
or agreement.

 

(b)           The
Issuer may contract with other Persons to assist it in performing its duties
under this Indenture, and any performance of such duties by a Person identified
to the Indenture Trustee in an Officers’ Certificate of the Issuer shall be
deemed to be action taken by the Issuer; provided, however, the
Issuer shall not be liable for any acts of Persons with whom the Issuer has
contracted with reasonable care. 
Initially, the Issuer has contracted with the Servicer and the
Administrator to assist the Issuer in performing its duties under this
Indenture.  The Issuer shall give
written notice to the Indenture Trustee and each Rating Agency of any such
contract with any other Person.

 

15

 

(c)           The
Issuer shall punctually perform and observe all of its obligations and
agreements contained in this Indenture, the other Basic Documents and the
instruments and agreements included in the Indenture Trust Estate, including
filing or causing to be filed all UCC financing statements and continuation
statements prepared by the Issuer and required to be filed by the terms of this
Indenture and the Administration Agreement in accordance with and within the
time periods provided for herein and therein. 
Except as otherwise expressly provided therein, the Issuer shall not
waive, amend, modify, supplement or terminate any Basic Document; provided,
for the avoidance of doubt, that a transfer or assignment by the Interest Rate
Cap Counterparty of any of its interests or obligations in accordance with the
requirements of Section 7 of the Interest Rate Cap Agreement (including the
requirement that each Rating Agency then rating the Notes issue written
acknowledgement that, notwithstanding such transfer or assignment, the then
current rating of the Notes will not be downgraded) shall not constitute a
waiver, amendment , modification, supplement or termination of the Interest Rate
Cap Agreement or any provision thereof and shall not require the consent of the
Indenture Trustee or the Noteholders of a least a majority of the Outstanding
Amount of the Notes.  The Issuer shall
give written notice to each Rating Agency or any such waiver, amendment,
modification, supplement or termination that requires the consent of the
Indenture Trustee or the Noteholders of at least a majority of the Outstanding
Amount of the Notes.

 

(d)           If
a Responsible Officer of the Issuer shall have knowledge of the occurrence of a
Servicer Default or an Administrator Default under the Servicing Agreement or
the Administration Agreement, respectively, the Issuer shall promptly notify
the Indenture Trustee and the Rating Agencies thereof, and shall specify in such
notice the action, if any, the Issuer is taking with respect to such
default.  If a Servicer Default shall
arise from the failure of the Servicer to perform any of its duties or
obligations under the Servicing Agreement, or an Administrator Default shall
arise from the failure of the Administrator to perform any of its duties or
obligations under the Administration Agreement, as the case may be, with
respect to the Trust Student Loans, the Issuer shall take all reasonable steps
available to it to enforce its rights under the Basic Documents in respect of
such failure.

 

(e)           As
promptly as possible after the giving of notice of termination to the Servicer
of the Servicer’s rights and powers, pursuant to Section 5.1 of the Servicing
Agreement, or to the Administrator of the Administrator’s rights and powers,
pursuant to Section 5.1 of the Administration Agreement, the Issuer shall
appoint a successor servicer (the “Successor Servicer”) or a successor
administrator (the “Successor Administrator”), respectively, and such Successor
Servicer or Successor Administrator, as the case may be, shall accept its
appointment by a written assumption in a form acceptable to the Indenture
Trustee.  In the event that a Successor
Servicer or Successor Administrator has not been appointed and accepted its
appointment at the time when the Servicer or Administrator, as the case may be,
ceases to act as Servicer or Administrator, respectively, the Indenture Trustee
without further action shall automatically be appointed the Successor Servicer
or Successor Administrator, as the case may be.  The Indenture Trustee may resign as the Successor Servicer or the
Successor Administrator by giving written notice of resignation to the Issuer
and in such event will be released from such duties and obligations, such
release not to be effective until the date a new servicer or a new
administrator enters into an agreement with the Issuer as provided below; provided,
however, that nothing herein shall require or permit the Indenture
Trustee to act as Servicer, or otherwise service the Trust Student Loans, in
violation of the Higher Education Act. 
Upon delivery of any

 

16

 

such notice to the Issuer, the Issuer shall
obtain a new servicer as the Successor Servicer under the Servicing Agreement
or a new administrator as the Successor Administrator under the Administration
Agreement, as the case may be.  Any
Successor Servicer or Successor Administrator, other than the Indenture
Trustee, shall (i) be an established institution (A) that satisfies any
requirements of the Higher Education Act applicable to servicers and (B) whose
regular business includes the servicing or administration of student loans and
(ii) enter into a servicing agreement or an administration agreement,
respectively, with the Issuer having substantially the same provisions as the
provisions of the Servicing Agreement and the Administration Agreement, as
applicable.  If within 30 days after the
delivery of the notice referred to above, the Issuer shall not have obtained
such a new servicer or new administrator, as the case may be, the Indenture
Trustee may appoint, or may petition a court of competent jurisdiction to
appoint, a Successor Servicer or Successor Administrator; provided, however,
that such right to appoint or to petition for the appointment of any such
successor shall in no event relieve the Indenture Trustee from any obligations
otherwise imposed on it under the Basic Documents until such successor has in
fact assumed such appointment.  In
connection with any such appointment, the Indenture Trustee may make such
arrangements for the compensation of such successor as it and such successor
shall agree, subject to the limitations set forth below and in the Servicing
Agreement or Administration Agreement, as applicable, and in accordance with
Section 5.2 of the Servicing Agreement and Section 5.2 of the Administration
Agreement, the Issuer shall enter into an agreement with such successor for the
servicing or administration of the Trust Student Loans (such agreement to be in
form and substance satisfactory to the Indenture Trustee).  If the Indenture Trustee shall succeed as
provided herein to the Servicer’s duties as Servicer with respect to the Trust
Student Loans, or the Administrator’s duties with respect to the Issuer and the
Trust Student Loans, as the case may be, it shall do so in its individual
capacity and not in its capacity as Indenture Trustee and, accordingly, the
provisions of Article VI hereof shall be inapplicable to the Indenture Trustee
in its duties as the successor to the Servicer or the Administrator, as the
case may be, and the servicing or administration of the Trust Student
Loans.  In case the Indenture Trustee
shall become successor to the Servicer or the Administrator, the Indenture
Trustee shall be entitled to appoint as Servicer or as Administrator, as the
case may be, any one of its Affiliates, provided that such appointment shall
not affect or alter in any way the liability of the Indenture Trustee as Successor
Servicer or Successor Administrator, respectively, in accordance with the terms
hereof.

 

(f)            Upon
any termination of the Servicer’s rights and powers pursuant to the Servicing
Agreement, or any termination of the Administrator’s rights and powers pursuant
to the Administration Agreement, as the case may be, the Issuer shall promptly
notify the Indenture Trustee and each Rating Agency.  As soon as a Successor Servicer or a Successor Administrator is
appointed, the Issuer shall notify the Indenture Trustee and each Rating Agency
of such appointment, specifying in such notice the name and address of such
Successor Servicer or such Successor Administrator.

 

(g)           Without
derogating from the absolute nature of the assignment granted to the Indenture
Trustee under this Indenture or the rights of the Indenture Trustee hereunder,
the Issuer agrees that it will not, without the prior written consent of the
Indenture Trustee or the Noteholders of at least a majority in Outstanding
Amount of the Notes, amend, modify, waive, supplement, terminate or surrender,
or agree to any amendment, modification, supplement, termination, waiver or
surrender of, the terms of any Collateral or the Basic Documents, except

 

17

 

to the extent otherwise provided in the Basic
Documents, or waive timely performance or observance by the Servicer, the
Administrator, the Depositor, the Excess Distribution Certificateholder, SLM
ECFC, the Issuer, the Eligible Lender Trustee or any Swap Counterparty under
the Basic Documents; provided, however, that no such amendment
shall (i) increase or reduce in any manner the amount of, or accelerate or
delay the timing of, distributions that are required to be made for the benefit
of the Noteholders or any Swap Counterparty, or (ii) reduce the aforesaid
percentage of the Notes which are required to consent to any such amendment,
without the consent of the Noteholders of all the Outstanding Notes.  If any such amendment, modification,
supplement or waiver shall be so consented to by the Indenture Trustee or such
Noteholders, the Issuer shall give written notice thereof to each Rating Agency
and agrees, promptly following a request by the Indenture Trustee to do so, to
execute and deliver, in its own name and at its own expense, such agreements,
instruments, consents and other documents as the Indenture Trustee may deem
necessary or appropriate in the circumstances.

 

SECTION 3.8   Negative
Covenants.  So long as any Notes
are Outstanding, the Issuer shall not:

 

(i)            except as expressly
permitted by this Indenture or any other Basic Document, sell, transfer,
exchange or otherwise dispose of any of the properties or assets of the Issuer,
including those included in the Indenture Trust Estate, unless directed to do
so by the Indenture Trustee;

 

(ii)           claim any credit on, or
make any deduction from the principal or interest payable in respect of, the
Notes (other than amounts properly withheld from such payments under the Code
or applicable state law) or assert any claim against any present or former
Noteholder by reason of the payment of the taxes levied or assessed upon any
part of the Indenture Trust Estate;

 

(iii)          (A) permit the validity
or effectiveness of this Indenture 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 with
respect to the Notes under this Indenture except as may be expressly permitted
hereby, (B) permit any lien, charge, excise, claim, 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 Indenture Trust Estate or
any part thereof or any interest therein or the proceeds thereof (other than
tax liens and other liens that arise by operation of law, and other than as
expressly permitted by the Basic Documents) or (C) permit the lien of this
Indenture not to constitute a valid first priority (other than with respect to
any such tax or other lien) security interest in the Indenture Trust Estate; or

 

(iv)          enter into any amendment
to the Interest Rate Cap Agreement or any Swap Agreement to cure any ambiguity
in, or to correct or supplement any provision of the Interest Rate Cap
Agreement or any Swap Agreement, unless the Issuer has determined, and the
Indenture Trustee has agreed in writing at the written direction of the Issuer,
that the amendment will not materially adversely affect the interests of the
Noteholders and provided that the Issuer has provided reasonable notice to the
Rating Agencies of such amendment and the Rating Agency Condition is satisfied.

 

18

 

SECTION 3.9   Annual
Statement as to Compliance.  The
Issuer will deliver to the Indenture Trustee and each Rating Agency, within 90
days after the end of each fiscal year of the Issuer (commencing with the
fiscal year ending December 31, 2004), an Officers’ Certificate of the Issuer
stating that:

 

(i)            a review of the
activities of the Issuer during such year and of performance under this
Indenture has been made under such Authorized Officers’ supervision; and

 

(ii)           to the best of such
Authorized Officers’ knowledge, based on such review, the Issuer has complied with
all conditions and covenants under this Indenture throughout such year, or, if
there has been a default in the compliance of any such condition or covenant,
specifying each such default known to such Authorized Officers and the nature
and status thereof.

 

SECTION 3.10   Issuer
May Consolidate, etc., Only on Certain Terms.

 

(a)           The
Issuer shall not consolidate or merge with or into any other Person, unless:

 

(i)            the Person (if other
than the Issuer) formed by or surviving such consolidation or merger shall be a
Person organized and existing under the laws of the United States of America or
any State and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Indenture Trustee, in form satisfactory to the
Indenture Trustee, the due and punctual payment of the principal of, and
interest, if any, on all Notes and the performance or observance of every
agreement and covenant of this Indenture and the other Basic Documents on the
part of the Issuer to be performed or observed, all as provided herein;

 

(ii)           immediately after
giving effect to such transaction, no Default shall have occurred and be
continuing;

 

(iii)          the Rating Agency
Condition shall have been satisfied with respect to such transaction;

 

(iv)          the Issuer shall have
received an Opinion of Counsel (and shall have delivered copies thereof to the
Indenture Trustee) to the effect that such transaction will not have any
material adverse Federal or Delaware state tax consequence to the Issuer or any
Noteholder or any Swap Counterparty;

 

(v)           any action as is
necessary to maintain the lien and security interest created by this Indenture
shall have been taken; and

 

(vi)          the Issuer shall have
delivered to the Indenture Trustee an Officers’ Certificate of the Issuer and
an Opinion of Counsel each stating that such consolidation or merger and such
supplemental indenture comply with this Article III and that all conditions
precedent herein provided for relating to such transaction have been complied
with (including any filing required by the Exchange Act).

 

19

 

(b)           The
Issuer shall not convey or transfer all or substantially all of its properties
or assets, including those included in the Indenture Trust Estate, to any
Person, unless:

 

(i)            the Person that
acquires by conveyance or transfer the properties and assets of the Issuer the
conveyance or transfer of which is hereby restricted shall (A) be a United
States citizen or a Person organized and existing under the laws of the United
States of America or any State, (B) expressly assume, by an indenture
supplemental hereto, executed and delivered to the Indenture Trustee, in form
satisfactory to the Indenture Trustee, the due and punctual payment of the
principal of, and interest, if any, on all Notes and the performance or
observance of every agreement and covenant of this Indenture on the part of the
Issuer to be performed or observed, all as provided herein, (C) expressly agree
by means of such supplemental indenture that all right, title and interest so
conveyed or transferred shall be subject and subordinate to the rights of
Noteholders and any Currency Swap Counterparty, (D) unless otherwise provided
in such supplemental indenture, expressly agree to indemnify, defend and hold
harmless the Issuer against and from any loss, liability or expense arising
under or related to this Indenture and the Notes and (E) expressly agree by
means of such supplemental indenture that such Person (or if a group of
Persons, then one specified Person) shall make all filings with the Commission
(and any other appropriate Person) required by the Exchange Act in connection
with the Notes;

 

(ii)           immediately after
giving effect to such transaction, no Default shall have occurred and be
continuing;

 

(iii)          the Rating Agency
Condition shall have been satisfied with respect to such transaction;

 

(iv)          the Issuer shall have
received an Opinion of Counsel (and shall have delivered copies thereof to the
Indenture Trustee) to the effect that such transaction will not have any
material adverse Federal or Delaware state tax consequence to the Issuer or any
Noteholder;

 

(v)           any action as is
necessary to maintain the lien and security interest created by this Indenture
shall have been taken; and

 

(vi)          the Issuer shall have delivered
to the Indenture Trustee an Officers’ Certificate of the Issuer and an Opinion
of Counsel each stating that such conveyance or transfer and such supplemental
indenture comply with this Article III and that all conditions precedent herein
provided for relating to such transaction have been complied with (including
any filing required by the Exchange Act).

 

SECTION 3.11   Successor
or Transferee. 
(a)  Upon any consolidation or merger of the Issuer in
accordance with Section 3.10(a), the Person formed by or surviving such
consolidation or merger (if other than the Issuer) shall succeed to, and be
substituted for, and may exercise every right and power of, the Issuer under
this Indenture with the same effect as if such Person had been named as the Issuer
herein.

 

(b)           Upon
a conveyance or transfer of all the assets and properties of the Issuer
pursuant to Section 3.10(b), SLM Student Loan Trust 2004-8 will be released
from every covenant and agreement of this Indenture to be observed or performed
on the part of the Issuer

 

20

 

with respect to the Notes immediately upon
the delivery by the Issuer of written notice to the Indenture Trustee stating
that SLM Student Loan Trust 2004-8 is to be so released.

 

SECTION 3.12   No Other
Business.  The Issuer shall not
engage in any business other than financing (including entering into Swap
Agreements from time to time), purchasing, owning, selling and managing the
Trust Student Loans and the other assets of the Issuer and related proceeds in
the manner contemplated by this Indenture and the other Basic Documents and
activities incidental thereto.

 

SECTION 3.13   No Borrowing.  The Issuer shall not issue, incur, assume,
guarantee or otherwise become liable, directly or indirectly, for any
indebtedness except for the Notes.

 

SECTION 3.14   Obligations of Servicer and
Administrator.  The
Issuer shall cause the Servicer to comply with Sections 3.1, 3.2 and 3.3 of the
Administration Agreement and Section 3.7 of the Servicing Agreement and the
Administrator to comply with Sections 2.11, 3.1, 3.2 and 3.3 of the
Administration Agreement.

 

SECTION 3.15   Guarantees,
Loans, Advances and Other Liabilities.  Except as contemplated by this Indenture and the other Basic
Documents, the Issuer shall not make any loan or advance or credit to, or
guarantee (directly or indirectly or by an instrument having the effect of
assuring another’s payment or performance on any obligation or capability of so
doing or otherwise), endorse or otherwise become contingently liable, directly
or indirectly, in connection with the obligations, stocks or dividends of, or
own, purchase, repurchase or acquire (or agree contingently to do so) any
stock, obligations, assets or securities of, or any other interest in, or make
any capital contribution to, any other Person.

 

SECTION 3.16   Capital
Expenditures.  The Issuer shall
not make any expenditure (by long-term or operating lease or otherwise) for
capital assets (either realty or personalty).

 

SECTION 3.17   Restricted
Payments.  The Issuer shall not,
directly or indirectly, (i) pay any dividend or make any distribution (by
reduction of capital or otherwise), whether in cash, property, securities or a
combination thereof, to the Eligible Lender Trustee or any owner of a
beneficial interest in the Issuer or otherwise with respect to any ownership or
equity interest or security in or of the Issuer or to the Servicer or the
Administrator, (ii) redeem, purchase, retire or otherwise acquire for value any
such ownership or equity interest or security or (iii) set aside or otherwise
segregate any amounts for any such purpose; provided, however,
that the Issuer may make, or cause to be made, distributions to the Servicer,
the Eligible Lender Trustee, the Indenture Trustee, the Noteholders, any Swap
Counterparty, any Remarketing Agent, the Administrator, the Depositor and the
Excess Distribution Certificateholder as contemplated by, and to the extent
funds are available for such purpose under, this Indenture and the other Basic
Documents.  The Issuer will not,
directly or indirectly, make payments to or distributions from the Collection
Account except in accordance with this Indenture and the other Basic Documents.

 

SECTION 3.18   Notice of
Events of Default.  The Issuer
shall give the Indenture Trustee, the Rating Agencies and each Swap
Counterparty prompt written notice of each Event

 

21

 

of Default hereunder.  The Issuer shall give the Indenture Trustee,
the Rating Agencies and each Swap Counterparty prompt written notice of each
default on the part of (i) the Depositor of its obligations under the Sale
Agreement, (ii) SLM ECFC of its obligations under the Purchase Agreement,
(iii) the Servicer of its obligations under the Servicing Agreement, or
(iv) the Administrator of its obligations under the Administration
Agreement.  In addition, the Issuer
shall deliver to the Indenture Trustee, each Rating Agency and each Swap
Counterparty, within five days after the occurrence thereof, written notice in
the form of an Officers’ Certificate of the Issuer of any event which with the
giving of notice and the lapse of time would become an Event of Default under
Section 5.1(iii), its status and what action the Issuer is taking or proposes to
take with respect thereto.

 

SECTION 3.19   Further
Instruments and Acts.  Upon
request of the Indenture Trustee, the Issuer will execute and deliver such
further instruments and do such further acts as may be reasonably necessary or
proper to carry out more effectively the purpose of this Indenture.

 

ARTICLE IV

 

Satisfaction
and Discharge

 

SECTION 4.1   Satisfaction
and Discharge of Indenture. 
This Indenture shall cease to be of further effect with respect to the
Notes except as to (i) rights of registration of transfer and exchange, (ii)
substitution of mutilated, destroyed, lost or stolen Notes, (iii) rights of
Noteholders to receive payments of principal thereof and interest thereon, (iv)
Sections 3.3, 3.4, 3.5, 3.8, 3.10, 3.12 and 3.13, (v) the rights, obligations
and immunities of the Indenture Trustee hereunder (including, without
limitation, the rights of the Indenture Trustee under Section 6.7 and the
obligations of the Indenture Trustee under Section 4.2) and (vi) the rights of
Noteholders as beneficiaries hereof with respect to the property so deposited
with the Indenture Trustee payable to all or any of them, and the Indenture
Trustee, on demand of and at the expense of the Issuer, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture with
respect to the Notes, when:

 

(a)           either

 

(1)           all
Notes theretofore authenticated and delivered (other than (i) Notes that have
been destroyed, lost or stolen and that have been replaced or paid as provided
in Section 2.5 and (ii) Notes for whose payment money has theretofore been
deposited in trust or segregated and held in trust by the Issuer and thereafter
repaid to the Issuer or discharged from such trust, as provided in Section 3.3)
have been delivered to the Indenture Trustee for cancellation; or

 

(2)           all
Notes not theretofore delivered to the Indenture Trustee for cancellation:

 

(i)            have become due and
payable,

 

(ii)           will become due and
payable at their respective Note Final Maturity Date, within one year, or

 

22

 

(iii)          are to be called for
redemption within one year under arrangements satisfactory to the Indenture
Trustee for the giving of notice of redemption by the Indenture Trustee in the
name, and at the expense, of the Issuer, and the Issuer, in the case of (i),
(ii) or (iii) above, has irrevocably deposited or caused to be irrevocably
deposited with the Indenture Trustee cash or direct obligations of or
obligations guaranteed by the United States of America (which will mature prior
to the date such amounts are payable), in trust for such purpose, in an amount
sufficient to pay and discharge the entire indebtedness on such Notes not
theretofore delivered to the Indenture Trustee for cancellation when due to the
Note Final Maturity Date;

 

(b)           the
Issuer has paid or caused to be paid all other sums payable hereunder by the
Issuer; and

 

(c)           the
Issuer has delivered to the Indenture Trustee an Officers’ Certificate of the
Issuer, an Opinion of Counsel and (if required by the TIA or the Indenture
Trustee) an Independent Certificate from a firm of certified public
accountants, each meeting the applicable requirements of Section 11.1(a) and,
subject to Section 11.2, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.

 

SECTION 4.2   Application
of Trust Money.  All moneys
deposited with the Indenture Trustee pursuant to Section 4.1 hereof shall be
held in trust and applied by it, in accordance with the provisions of the Notes
and this Indenture, to the payment, either directly or through any Paying
Agent, as the Indenture Trustee may determine, to the Noteholders of the
particular Notes or to any Swap Counterparty, as applicable, for the payment or
redemption of which such moneys have been deposited with the Indenture Trustee,
of all sums due and to become due thereon for principal and interest; but such
moneys need not be segregated from other funds except to the extent required
herein or in the Administration Agreement or required by law.

 

SECTION 4.3   Repayment
of Moneys Held by Paying Agent. 
In connection with the satisfaction and discharge of this Indenture with
respect to the Notes, all moneys then held by any Paying Agent other than the
Indenture Trustee under the provisions of this Indenture with respect to such
Notes shall, upon demand of the Issuer, be paid to the Indenture Trustee to be
held and applied according to Section 3.3 and thereupon such Paying Agent shall
be released from all further liability with respect to such moneys.

 

SECTION 4.4   Auction
of Trust Student Loans.  On the
date (the “Trust Auction Date”) that is three Business Days prior to the
Distribution Date immediately following the end of the first Collection Period
when the Pool Balance is equal to 10% or less of the Initial Pool Balance, any
Trust Student Loans remaining in the Trust shall be offered for sale by the
Indenture Trustee unless the Servicer has exercised its option to purchase the
Trust Estate as described in Section 6.1(a) of the Administration Agreement
with respect to such Distribution Date. 
The Servicer will be deemed to have waived such option if it fails to
notify the Eligible Lender Trustee and the Indenture Trustee of its exercise
thereof in writing prior to the Indenture Trustee’s acceptance of a bid to
purchase such Trust Student Loans; provided, however, that there
shall be no such offer for sale if the Indenture Trustee fails to provide
notice to the Servicer in accordance with this Section 4.4.  The Indenture Trustee shall provide written
notice to the

 

23

 

Servicer of any such offer for sale at least
5 Business Days in advance of the Trust Auction Date.  The Indenture Trustee shall permit the Servicer or any of its
Affiliates including SLM ECFC to offer bids only if the Pool Balance as of the
applicable Trust Auction Date is equal to 10% or less of the Initial Pool
Balance and such bid does not exceed the fair market value of the Trust Student
Loans as of the Trust Auction Date.  If
at least two bids are received, the Indenture Trustee shall solicit and
resolicit new bids from all participating bidders until only one bid remains or
the remaining bidders decline to resubmit bids.  The Indenture Trustee shall accept the highest of such remaining
bids if it is equal to or in excess of both the Minimum Purchase Amount and the
fair market value of such Trust Student Loans as of the end of the Collection
Period immediately preceding the Trust Auction Date.  If at least two bids are not received or the highest bid after
the resolicitation process is completed is not equal to or in excess of the
higher of the Minimum Purchase Amount and the fair market value of the Trust
Student Loans, the Indenture Trustee shall not consummate such sale.  The Indenture Trustee may consult, and, at
the direction of the Depositor, shall consult, with a financial advisor,
including an Underwriter or Initial Purchaser of the Notes or the
Administrator, to determine if the fair market value of the Trust Student Loans
has been offered.  The proceeds of any
such sale will be paid at the time set forth in Section 2.6 of the
Administration Agreement and applied in the order of priority set forth in
Section 5.4(b).  If the sale is not
consummated in accordance with the foregoing, the Indenture Trustee may, but
shall not be under any obligation to, solicit bids for sale of the Trust
Student Loans with respect to future Distribution Dates upon terms similar to
those described above, including the Servicer’s waiver of its option to
purchase the Trust Estate in accordance with Section 6.1(a) of the
Administration Agreement with respect to each such future Distribution Date.

 

ARTICLE V

 

Remedies

 

SECTION 5.1   Events of Default.  “Event of Default,” wherever used herein,
means any one of the following events (whatever the reason for such Event of
Default and whether it shall be voluntary or involuntary or be effected by
operation of law or pursuant to any judgment, decree or order of any court or
any order, rule or regulation of any administrative or governmental body):

 

(i)            default in the payment
of any interest on any Note when the same becomes due and payable, and such
default shall continue for a period of five days; or

 

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

 

(iii)          default in the
observance or performance of any covenant or agreement of the Issuer made in
this Indenture (other than a covenant or agreement, a default in the observance
or performance of which is elsewhere in this Section specifically dealt with),
or any representation or warranty of the Issuer made in this Indenture or in
any certificate or other writing having been incorrect in any material respect
as of the time when made, such default or breach having a material adverse
effect on the holders of the Notes, and such default or breach shall continue
or not be cured, or the circumstance or condition in respect of which such

 

24

 

misrepresentation
or warranty was incorrect shall not have been eliminated or otherwise cured,
for a period of 30 days after there shall have been given, by registered or
certified mail, to the Issuer by the Indenture Trustee or to the Issuer and the
Indenture Trustee by the Noteholders of at least 25% of the Outstanding Amount
of the Notes, a written notice specifying such default or incorrect
representation or warranty and requiring it to be remedied and stating that
such notice is a notice of Default hereunder; or

 

(iv)          the filing of a decree
or order for relief by a court having jurisdiction in the premises in respect
of the Issuer or any substantial part of the Indenture Trust Estate in an involuntary
case under any applicable Federal or state bankruptcy, insolvency or other
similar law now or hereafter in effect, or appointing a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the Issuer or
for any substantial part of the Indenture Trust Estate, or ordering the
winding-up or liquidation of the Issuer’s affairs, and such decree or order
shall remain unstayed and in effect for a period of 60 consecutive days; or

 

(v)           the commencement by the
Issuer of a voluntary case under any applicable Federal or state bankruptcy,
insolvency or other similar law now or hereafter in effect, or the consent by
the Issuer to the entry of an order for relief in an involuntary case under any
such law, or the consent by the Issuer to the appointment or taking possession
by a receiver, liquidator, assignee, custodian, trustee, sequestrator or
similar official of the Issuer or for any substantial part of the Indenture
Trust Estate, or the making by the Issuer of any general assignment for the
benefit of creditors, or the failure by the Issuer generally to pay its debts
as such debts become due, or the taking of action by the Issuer in furtherance
of any of the foregoing.

 

SECTION 5.2   Acceleration
of Maturity; Rescission and Annulment.  If an Event of Default should occur and be continuing, then and
in every such case the Indenture Trustee or the Noteholders representing at
least a majority of the Outstanding Amount of the Notes may declare all the
Notes to be immediately due and payable, by a notice in writing to the Issuer
(and to the Indenture Trustee if given by Noteholders), and upon any such
declaration the unpaid principal amount of such Notes, together with accrued
and unpaid interest thereon through the date of acceleration, shall become
immediately due and payable, subject, however, to Section 5.4 of this
Indenture.

 

At any time after such declaration of
acceleration of maturity has been made and before a judgment or decree for
payment of the money due has been obtained by the Indenture Trustee as
hereinafter in this Article V provided, the Noteholders of Notes representing
at least a majority of the Outstanding Amount of the Notes, by written notice
to the Issuer and the Indenture Trustee, may rescind and annul such declaration
and its consequences if:

 

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

 

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

 

25

 

(b)           all sums paid or
advanced by the Indenture Trustee hereunder and the reasonable compensation,
expenses, disbursements and advances of the Indenture Trustee and its agents
and counsel; and

 

(ii)           all Events of Default,
other than the nonpayment of the principal of the Notes that has become due
solely by such acceleration, have been cured or waived as provided in Section
5.12.

 

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

 

SECTION 5.3   Collection
of Indebtedness and Suits for Enforcement by Indenture Trustee.  The Issuer covenants that if (i) default is
made in the payment of any interest on any Note when the same becomes due and
payable, and such default continues for a period of five days, or (ii) default
is made in the payment of the principal of any Note when the same becomes due
and payable at the related Note Final Maturity Date, the Issuer shall, upon
demand of the Indenture Trustee, pay to it, for the benefit of the Noteholders,
the whole amount then due and payable on such Notes for principal and interest,
with interest upon the overdue principal, and, to the extent payment at such
rate of interest shall be legally enforceable, upon overdue installments of
interest, at the rate specified in Section 2.7 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.

 

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

 

(b)           If
an Event of Default occurs and is continuing, the Indenture Trustee may, as
more particularly provided in Section 5.4, in its discretion, proceed to
protect and enforce its rights and the rights of the Noteholders and any
Currency Swap Counterparty by such appropriate Proceedings as the Indenture
Trustee shall deem most effective 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 or legal or equitable right vested in the Indenture Trustee
by this Indenture or by law.

 

(c)           In
case there shall be pending, relative to the Issuer or any other obligor upon
the Notes or any Person having or claiming an ownership interest in the
Indenture Trust Estate, Proceedings under Title 11 of the United States Code or
any other applicable Federal or state bankruptcy, insolvency or other similar
law, or in case a receiver, assignee or trustee in bankruptcy or
reorganization, liquidator, sequestrator or similar official shall have been
appointed for or taken possession of the Issuer or its property or such other
obligor or Person, or in case of any other, comparable judicial Proceedings
relative to the Issuer or other obligor upon

 

26

 

the Notes, or to the creditors or property of
the Issuer or such other obligor, the Indenture Trustee, irrespective of
whether the principal of any Notes 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 pursuant to the provisions of this
Section, shall be entitled and empowered, by intervention in such proceedings
or otherwise:

 

(i)            to file and prove a
claim or claims for the whole amount of principal and interest 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 reasonable compensation to the Indenture Trustee and
each predecessor Indenture Trustee, and their respective agents, attorneys and
counsel, and for reimbursement of all expenses and liabilities incurred, and
all advances made, by the Indenture Trustee and each predecessor Indenture
Trustee, except as a result of negligence or bad faith) and of the Noteholders
allowed in such Proceedings;

 

(ii)           unless prohibited by
applicable law and regulations, to vote on behalf of the Noteholders (and, if
applicable, any Currency Swap Counterparty) in any election of a trustee, a
standby trustee or Person performing similar functions in any such Proceedings;

 

(iii)          to collect and receive
any moneys or other property payable or deliverable on any such claims and to
distribute all amounts received with respect to the claims of the Noteholders,
any Currency Swap Counterparty and the Indenture Trustee on their behalf; and

 

(iv)          to file such proofs of
claim and other papers or documents as may be necessary or advisable in order
to have the claims of the Indenture Trustee, any Currency Swap Counterparty or
the Noteholders allowed in any judicial proceedings relative to the Issuer, its
creditors and its property;

 

and any trustee, receiver, liquidator,
custodian or other similar official in any such Proceeding is hereby authorized
by each of such Noteholders and any Currency Swap Counterparty to make payments
to the Indenture Trustee, and, in the event that the Indenture Trustee shall
consent to the making of payments directly to such Noteholders and any Currency
Swap Counterparty to pay to the Indenture Trustee such amounts as shall be
sufficient to cover reasonable compensation to the Indenture Trustee, each
predecessor Indenture Trustee and their respective agents, attorneys and
counsel, and all other expenses and liabilities incurred, and all advances
made, by the Indenture Trustee and each predecessor Indenture Trustee except as
a result of negligence or bad faith.

 

(d)           Nothing
herein contained shall be deemed to authorize the Indenture Trustee to
authorize or consent to or vote for or accept or adopt on behalf of any
Noteholder 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 in any such
proceeding except, as aforesaid, to vote for the election of a trustee in
bankruptcy or similar Person.

 

27

 

(e)           All
rights of action and of asserting claims under this Indenture, or under any of
the Notes, may be enforced by the Indenture Trustee without the possession of
any of the Notes or the production thereof in any trial or other Proceedings
relative thereto, and any such action or Proceedings instituted by the
Indenture Trustee shall be brought in its own name as trustee of an express
trust, and any recovery of judgment, subject to the payment of the expenses,
disbursements and compensation of the Indenture Trustee, each predecessor
Indenture Trustee and their respective agents and attorneys, shall be for the
ratable benefit of the Noteholders, and after the Notes have been paid in full,
and subject to the provisions of Section 11.19, any Currency Swap Counterparty.

 

(f)            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 each Currency Swap Counterparty, and it shall
not be necessary to make any Noteholder or any Currency Swap Counterparty a
party to any such Proceedings.

 

SECTION 5.4   Remedies;
Priorities.  If an Event of
Default shall have occurred and be continuing, the Indenture Trustee may do one
or more of the following (subject to Section 5.5):

 

(a)           (i)            institute Proceedings
in its own name and as trustee of an express trust for the collection of all
amounts then payable on the Notes or under this Indenture with respect thereto,
whether by declaration or otherwise, enforce any judgment obtained, and collect
from the Issuer and any other obligor upon such Notes moneys adjudged due;

 

(ii)           institute Proceedings
from time to time for the complete or partial foreclosure of this Indenture,
with respect to the Indenture Trust Estate;

 

(iii)          exercise any remedies of
a secured party under the UCC with respect to the Trust Estate and take any
other appropriate action to protect and enforce the rights and remedies of the
Indenture Trustee, any Currency Swap Counterparty and the Noteholders;

 

(iv)          sell the Indenture Trust
Estate or any portion thereof or rights or interest therein, at one or more
public or private sales called and conducted in any manner permitted by law;
and/or

 

(v)           elect to have the
Eligible Lender Trustee maintain ownership of the Trust Student Loans and
continue to apply collections with respect to the Trust Student Loans as if
there had been no declaration of acceleration;

 

provided,
however, that the Indenture Trustee may not sell or otherwise liquidate
the Indenture Trust Estate following an Event of Default, other than an Event
of Default described in Section 5.1(i) or (ii) with respect to the Class A
Notes, unless (A) the Noteholders of 100% of the Outstanding Amount of the
Class A Notes consent thereto, (B) the proceeds of such sale or liquidation
distributable to the Class A Noteholders are sufficient to discharge in full
all amounts then due and unpaid upon such Class A Notes for principal and
interest or (C) the Indenture Trustee determines that the Indenture Trust Estate
will not continue to provide sufficient funds for the payment of principal of
and interest on the Class A Notes as would have become due if

 

28

 

the Class A
Notes had not been declared due and payable, and the Indenture Trustee obtains
the consent of Noteholders of 66-2/3% of the Outstanding Amount of the Class A
Notes; provided, further, that the Indenture Trustee may not sell
or otherwise liquidate the Indenture Trust Estate following an Event of
Default, other than an Event of Default described in Section 5.1(i) or (ii)
with respect to the Class A Notes, unless (D) the proceeds of such sale or
liquidation distributable to the Class B Noteholders plus the proceeds of the
sale or liquidation of the Trust Estate distributable to the Class B
Noteholders are sufficient to pay to the Class B Noteholders the Outstanding
Amount of the Class B Notes plus accrued and unpaid interest thereon or
(E) after receipt of notice from the Eligible Lender Trustee that the proceeds
of such sale or liquidation distributable to the Class B Noteholders plus the
proceeds of the sale or liquidation of the Trust Estate distributable to the
Class B Noteholders would not be sufficient to pay to the Class B Noteholders
the outstanding principal plus accrued and unpaid interest thereon, the Class B
Noteholders of at least a majority of the Outstanding Amount of the Class B
Notes consent thereto.  In determining
such sufficiency or insufficiency with respect to clauses (B), (C), (D) and (E),
the Indenture Trustee may, but need not, obtain and rely upon an opinion of an
Independent investment banking or accounting firm of national reputation as to
the feasibility of such proposed action and as to the sufficiency of the
Indenture Trust Estate and/or Trust Estate, as applicable, for such purpose.

 

(b)           Notwithstanding
the provisions of Section 8.2, following the occurrence and during the
continuation of an Event of Default specified in Section 5.1(i), 5.1(ii),
5.1(iv) or 5.1(v) which has resulted in an acceleration of the Notes, if the
Indenture Trustee collects any money or property, it shall pay out the money or
property (and other amounts including amounts, if any, held on deposit in each
of the Trust Accounts) held as Collateral for the benefit of the Noteholders,
net of liquidation costs associated with the sale of the assets of the Trust,
in the following order:

 

FIRST:

 

A:                                   to
the applicable Noteholders of each class of Reset Rate Notes then denominated
in U.S. Dollars and then structured not to receive a payment of principal until
the end of its related Reset Period, the amount, if any, on deposit in the
related Accumulation Account for such Reset Rate Notes (excluding any
Investment Earnings thereon) in reduction of the Outstanding Amount of such
Reset Rate Notes until they are paid in full; and/or

 

B:                                     to
the related Currency Swap Counterparty if any class of Reset Rate Notes is then
in Foreign Exchange Mode is then structured not to receive a payment of
principal until the end of its related Reset Period, the amount, if any, on
deposit in the related Accumulation Account for such Reset Rate Notes
(excluding any Investment Earnings thereon) in reduction of the Outstanding
Amount of such Reset Rate Notes until they are paid in full;

 

SECOND:               to the Indenture Trustee for amounts due
under Section 6.7;

 

29

 

THIRD:                  to the Servicer
for due and unpaid Primary Servicing Fees;

 

FOURTH:              to
the Administrator, any due and unpaid Administration Fees;

 

FIFTH:                   pro rata, based on amounts due and
owing:

 

A:                                   to
the Class A Noteholders (other than the noteholders of any class of Reset Rate
Notes if a Swap Agreement with respect to interest payments to be made to such
noteholders is then in effect), for amounts due and unpaid on the Class A Notes
for interest at the applicable Note Rate, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Class A
Notes for such interest;

 

B:                                     if
a Swap Agreement is then in effect for any class of Reset Rate Noteholders with
respect to interest payments to be made to such noteholders, to each Swap
Counterparty, the amount of any Swap Interest Payments due and payable by the
Issuer (other than as paid to that Swap Counterparty under clause FIRST); and

 

C:                                     if
any Swap Agreement with respect to any class of Reset Rate Notes has been
terminated, to the related Swap Counterparty, the amount of any Swap
Termination Payments due to such Swap Counterparty due to a Termination Event
(as defined in the related Swap Agreement) resulting from a payment default
under the related Swap Agreement by the Issuer, a non-rescindable, non-waivable
acceleration of the Notes, or the bankruptcy or insolvency of the Issuer.

 

SIXTH:

 

A:                                 If
any class of Reset Rate Notes is in Foreign Exchange Mode, pro rata (1) to
the Class A Noteholders (other than the holders of any such class of Reset Rate
Notes then in Foreign Exchange Mode), ratably, an amount sufficient to reduce
the respective principal balance of those Class A Notes to zero, and (2) to the
applicable Currency Swap Counterparties an amount sufficient to reduce the U.S.
Dollar Equivalent Principal Amount of each class of Reset Rate Notes then in
Foreign Exchange Mode to zero; or

 

B:                                   if
both classes of Reset Rate Notes are then denominated in U.S. Dollars, pro rata
to the Class A Noteholders, ratably, an amount sufficient to reduce the
respective principal balance of those Class A Notes to zero;

 

SEVENTH:             to
the Class B Noteholders for amounts due and unpaid on the Class B Notes for
interest at the Class B Note Rate;

 

EIGHTH:                to
the Class B Noteholders, an amount sufficient to reduce the Outstanding
Amount of the Class B Notes to zero;

 

30

 

NINTH:                  to the Servicer, for any unpaid
Carryover Servicing Fees;

 

TENTH:                 to any Swap Counterparties (including
the Interest Rate Cap Swap Counterparty), pro rata, the amount of any Swap
Termination Payments due to such Swap Counterparties by the Issuer and not
payable in Clause FIFTH (C);

 

ELEVENTH:          to the Remarketing Agents, any due and unpaid
Remarketing Fees payable by the Issuer to the extent not previously paid from
amounts on deposit in the Remarketing Fee Account;

 

TWELFTH:           sequentially, first to the Remarketing
Agents, and second to the Administrator for any advances made on behalf of the
Issuer, in each case, for payment of certain costs and expenses as set forth in
Section 3 of the Remarketing Agreement in connection with the remarketing of
any class of Reset Rate Notes not previously reimbursed by the Issuer; and

 

THIRTEENTH:     to the Excess Distribution Certificateholder, any
remaining funds.

 

If the Trust has entered into a Currency Swap
Agreement and such Currency Swap Agreement terminates, amounts that would have
otherwise been paid to the related Currency Swap Counterparty (other than
amounts payable as a Termination Payment thereunder) will be used to make
payments to the related class of Reset Rate Noteholders in an amount in the
applicable non-U.S. Dollar currency, equal to the payment that the related
Currency Swap Counterparty would have made. 
If this occurs, the Trust will exchange U.S. Dollars for the applicable
non-U.S. Dollar currency in order to make distributions on the applicable class
of Reset Rate Notes.

 

The Indenture Trustee may fix a record date
and payment date for any payment to Noteholders pursuant to this Section.  At least 15 days before such record date,
the Indenture Trustee shall mail to each Noteholder and the Issuer a notice
that states the record date, the payment date and the amount to be paid.

 

SECTION 5.5   Optional
Preservation of the Trust Student Loans.  If the Notes have been declared to be due
and payable under Section 5.2 following an Event of Default and such
declaration and its consequences have not been rescinded and annulled, the
Indenture Trustee may, but need not, elect to maintain possession of the
Indenture Trust Estate.  It is the
desire of the parties hereto and the Noteholders that there be at all times
sufficient funds for the payment of principal of and interest on the Notes, and
the Indenture Trustee shall take such desire into account when determining
whether or not to maintain possession of the Indenture Trust Estate.  In determining whether to maintain
possession of the Indenture Trust Estate, the Indenture Trustee may, but need
not, obtain and rely upon an opinion of an Independent investment banking or
accounting firm of national reputation as to the feasibility of such proposed
action and as to the sufficiency of the Indenture Trust Estate for such
purpose.

 

SECTION 5.6   Limitation of
Suits.  No Noteholder shall have
any right to institute any Proceeding, judicial or otherwise, with respect to
this Indenture, or for the appointment of a receiver or trustee, or for any other
remedy hereunder, unless:

 

31

 

(i)            such Noteholder has
previously given written notice to the Indenture Trustee of a continuing Event
of Default;

 

(ii)           the Noteholders of not
less than 25% of the Outstanding Amount of the Notes have made written request
to the Indenture Trustee to institute such Proceeding in respect of such Event
of Default in its own name as Indenture Trustee hereunder;

 

(iii)          such Noteholder or
Noteholders have offered to the Indenture Trustee reasonable indemnity against
the costs, expenses and liabilities to be incurred in complying with such
request;

 

(iv)          the Indenture Trustee
for 60 days after its receipt of such notice, request and offer of indemnity
has failed to institute such Proceeding; and

 

(v)           no direction
inconsistent with such written request has been given to the Indenture Trustee
during such 60-day period by the Noteholders of at least a majority of the
Outstanding Amount of the Notes;

 

it being understood and intended that no one
or more Noteholders shall have any right in any manner whatever by virtue of,
or by availing of, any provision of this indenture to affect, disturb or
prejudice the rights of any other Noteholders or to obtain or to seek to obtain
priority or preference over any other Noteholders or to enforce any right under
this Indenture, except in the manner herein provided.

 

In the event the Indenture Trustee shall
receive conflicting or inconsistent requests and indemnity from two or more
groups of Noteholders, each representing less than a majority of the
Outstanding Amount of the Notes, the Indenture Trustee in its sole discretion
may determine what action, if any, shall be taken, notwithstanding any other
provisions of this Indenture.

 

SECTION 5.7   Unconditional
Rights of Noteholders to Receive Principal and Interest.  Notwithstanding any other provisions in this
Indenture, each Noteholder shall have the right, which is absolute and
unconditional, to receive payment of the principal of and interest on its Note
on or after the respective due dates thereof expressed in such Note or in this
Indenture (or, in the case of redemption, on or after the Redemption Date) and
to institute suit for the enforcement of any such payment, and such right shall
not be impaired without the consent of such Noteholder.

 

SECTION 5.8   Restoration
of Rights and Remedies.  If the
Indenture Trustee or any Noteholder has instituted any Proceeding to enforce
any right or remedy under this Indenture and such Proceeding has been discontinued
or abandoned for any reason or has been determined adversely to the Indenture
Trustee or to such Noteholder, then and in every such case the Issuer, the
Indenture Trustee and the Noteholders shall, subject to any determination in
such Proceeding, be restored severally and respectively to their former
positions hereunder, and thereafter all rights and remedies of the Indenture
Trustee and the Noteholders shall continue as though no such Proceeding had
been instituted.

 

32

 

SECTION 5.9   Rights
and Remedies Cumulative.  No
right or remedy herein conferred upon or reserved to the Indenture Trustee, any
Swap Counterparty or to the Noteholders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent
permitted by law, be cumulative and in addition to every other right and remedy
given hereunder or now or hereafter existing at law or in equity or
otherwise.  The assertion or employment
of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.

 

SECTION 5.10   Delay
or Omission Not a Waiver.  No
delay or omission of the Indenture Trustee, any Swap Counterparty or any
Noteholder to exercise any right or remedy accruing upon any Default shall
impair any such right or remedy or constitute a waiver of any such Default or
an acquiescence therein.  Every right
and remedy given by this Article V or by law to the Indenture Trustee, any Swap
Counterparty or to the Noteholders may be exercised from time to time, and as
often as may be deemed expedient, by the Indenture Trustee, any Swap
Counterparty or by the Noteholders, as the case may be.

 

SECTION 5.11   Control by
Noteholders.  The Noteholders of
at least a majority of the Outstanding Amount of the Notes shall have the right
to direct the time, method and place of conducting any Proceeding for any
remedy available to the Indenture Trustee with respect to the Notes or
exercising any trust or power conferred on the Indenture Trustee; provided that

 

(i)            such direction shall
not be in conflict with any rule of law or with this Indenture;

 

(ii)           subject to the express
terms of Section 5.4, any direction to the Indenture Trustee to sell or liquidate
the Indenture Trust Estate shall be by the Noteholders of not less than 100% of
the Outstanding Amount of the Notes;

 

(iii)          if the conditions set
forth in Section 5.5 have been satisfied and the Indenture Trustee elects to
retain the Indenture Trust Estate pursuant to such Section, then any direction
to the Indenture Trustee by Noteholders of less than 100% of the Outstanding
Amount of the Notes to sell or liquidate the Indenture Trust Estate shall be of
no force and effect; and

 

(iv)          the Indenture Trustee
may take any other action deemed proper by the Indenture Trustee that is not
inconsistent with such direction;

 

provided, however,
that, subject to Section 6.1, the Indenture Trustee need not take any action
that it determines might involve it in liability or might materially adversely
affect the rights of any Noteholders not consenting to such action.

 

SECTION 5.12   Waiver of
Past Defaults.  Prior to the
time a judgment or decree for payment of money due has been obtained as
described in Section 5.2, the Noteholders of at least a majority of the
Outstanding Amount of the Notes may waive any past Default and its consequences
except a Default (a) in payment when due of principal of or interest on any of
the Notes or (b) in respect of a covenant or provision hereof which cannot be
modified or amended without the consent of each Noteholder.  In the case of any such waiver, the Issuer,
the Indenture Trustee and the Noteholders shall be restored to their former
positions and rights hereunder,

 

33

 

respectively; but no such waiver shall extend
to any subsequent or other Default or impair any right consequent thereto.

 

Upon any such waiver, such Default shall
cease to exist and be deemed to have been cured and not to have occurred for
every purpose of this Indenture; but no such waiver shall extend to any
subsequent or other Default or impair any right consequent thereto.

 

SECTION 5.13   Undertaking
for Costs.  All parties to this
Indenture agree, and each Noteholder by such Noteholder’s acceptance of any
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,
suffered 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 shall not apply to (a) any suit
instituted by the Indenture Trustee, (b) any suit instituted by any Noteholder,
or group of Noteholders, in each case holding in the aggregate more than 10% of
the Outstanding Amount of the Notes or (c) any suit Instituted by any
Noteholder for the enforcement of the payment of principal of or interest on
any Note on or after the respective due dates expressed in such Note and in
this Indenture (or, in the case of redemption, on or after the Redemption
Date).

 

SECTION 5.14   Waiver
of Stay or Extension Laws.  The
Issuer covenants (to the extent that it may lawfully do so) that it will not at
any time insist upon, or plead or in any manner whatsoever, claim or take the
benefit or advantage of, any stay or extension law wherever enacted, now or at
any time hereafter in force, that may affect the covenants or the performance
of this Indenture; and the Issuer (to the extent that it may lawfully do so)
hereby expressly waives all benefit or advantage of any such law, and covenants
that it will not hinder, delay or impede the execution of any power herein
granted to the Indenture Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.

 

SECTION 5.15   Action on Notes.  The Indenture Trustee’s right to seek and
recover judgment on the Notes or under this Indenture shall not be affected by
the seeking, obtaining or application of any other relief under or with respect
to this Indenture.  Neither the lien of
this Indenture nor any rights or remedies of the Indenture Trustee or the
Noteholders shall be impaired by the recovery of any judgment by the Indenture
Trustee against the Issuer or by the levy of any execution under such judgment
upon any portion of the Indenture Trust Estate or upon any of the assets of the
Issuer.  Any money or property collected
by the Indenture Trustee shall be applied in accordance with Section 5.4(b).

 

SECTION 5.16   Performance and Enforcement of
Certain Obligations.

 

(a)           Promptly
following a request from the Indenture Trustee to do so and at the
Administrator’s expense, the Issuer shall take all such lawful action as the
Indenture Trustee may request to compel or secure the performance and
observance by the Depositor, SLM ECFC, the Administrator and the Servicer, as
applicable, of each of their respective obligations to the Issuer, whether
directly or by assignment, under or in connection with the Sale Agreement, the

 

34

 

Purchase Agreement, the Administration
Agreement and the Servicing Agreement, respectively, in accordance with the
terms thereof, and to exercise any and all rights, remedies, powers and
privileges lawfully available to the Issuer under or in connection with the
Sale Agreement, the Purchase Agreement, the Administration Agreement and the
Servicing Agreement, as the case may be, to the extent and in the manner
directed by the Indenture Trustee, including the transmission of notices of
default on the part of the Depositor, SLM ECFC, the Administrator or the
Servicer thereunder and the institution of legal or administrative actions or
proceedings to compel or secure performance by the Depositor, SLM ECFC, the
Administrator or the Servicer of each of their obligations under the Sale
Agreement, the Purchase Agreement, the Administration Agreement and the
Servicing Agreement, respectively.

 

(b)           If
an Event of Default has occurred and is continuing, the Indenture Trustee may,
and at the written direction of the Noteholders of 66-2/3% of the Outstanding
Amount of the Notes shall, exercise all rights, remedies, powers, privileges
and claims of the Issuer against the Depositor, SLM ECFC, the Administrator or
the Servicer under or in connection with the Sale Agreement, the Purchase
Agreement, the Administration Agreement and the Servicing Agreement,
respectively, including the right or power to take any action to compel or
secure performance or observance by the Depositor, SLM ECFC, the Administrator
or the Servicer of each of their obligations to the Issuer thereunder, whether
directly or by assignment, and to give any consent, request, notice, direction,
approval, extension or waiver under the Sale Agreement, the Purchase Agreement,
the Administration Agreement and the Servicing Agreement, respectively, and any
right of the Issuer to take such action shall be suspended.

 

ARTICLE VI

 

The Indenture
Trustee

 

SECTION 6.1   Duties
of Indenture Trustee. 
(a)  If an Event of Default has occurred and is continuing,
the Indenture Trustee shall exercise the rights and powers vested in it by this
Indenture and use the same degree of care and skill in its exercise as a
prudent person would exercise or use under the circumstances in the conduct of
such person’s own affairs.

 

(b)           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; provided, however, that the
Indenture Trustee shall examine the certificates and opinions to determine
whether or not they conform to the requirements of this Indenture.

 

(c)           The
Indenture Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:

 

35

 

(i)            this paragraph does
not limit the effect of paragraph (b) of this Section;

 

(ii)           the Indenture Trustee
shall not be liable for any error of judgment made in good faith by a
Responsible Officer unless it is proved that the Indenture Trustee was
negligent in ascertaining the pertinent facts; and

 

(iii)          the Indenture Trustee
shall not be liable with respect to any action it takes or omits to take in
good faith in accordance with a direction received by it pursuant to Section
5.11.

 

(d)           The
Indenture Trustee shall not be liable for interest on any money received by it
except as the Indenture Trustee may agree in writing with the Issuer.

 

(e)           Money
held in trust by the Indenture Trustee need not be segregated from other funds
except to the extent required by law or the terms of this Indenture or the
other Basic Documents.

 

(f)            No
provision of this Indenture shall require the Indenture Trustee to expend or
risk its own funds or otherwise incur financial liability in the performance of
any of its duties hereunder or in the exercise of any of its rights or powers,
if it shall have reasonable grounds to believe that repayments of such funds or
adequate indemnity satisfactory to it against any loss, liability or expense is
not reasonably assured to it.

 

(g)           Except
as expressly provided in the Basic Documents, the Indenture Trustee shall have
no obligation to administer, service or collect the Trust Student Loans or to maintain,
monitor or otherwise supervise the administration, servicing or collection of
the Trust Student Loans.

 

(h)           In
the event that the Indenture Trustee is the Paying Agent or the Note Registrar,
the rights and protections afforded to the Indenture Trustee pursuant to this
Indenture shall also be afforded to the Indenture Trustee in its capacity as
Paying Agent or Note Registrar.

 

(i)            Every
provision of this Indenture relating to the conduct or affecting the liability
of or affording protection to the Indenture Trustee shall be subject to the
provisions of this Section and to the provisions of the TIA.

 

SECTION 6.2   Rights
of Indenture Trustee. 
(a)  The Indenture Trustee may rely on any document believed
by it to be genuine and to have been signed or presented by the proper
Person.  The Indenture Trustee need not
investigate any fact or matter stated in such document.

 

(b)           Before
the Indenture Trustee acts or refrains from acting, it may require and shall be
entitled to receive an Officers’ Certificate of the Issuer and/or an Opinion of
Counsel.  The Indenture Trustee shall
not be liable for any action it takes or omits to take in good faith in
reliance on such Officers’ Certificate or Opinion of Counsel.

 

(c)           The
Indenture Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys or a
custodian or nominee, and the Indenture Trustee shall not be responsible for
any misconduct or negligence

 

36

 

on the part of, or for the supervision of,
any such agent, attorney, custodian or nominee appointed with due care by it
hereunder.

 

(d)           The
Indenture Trustee shall not be liable for any action it takes or omits to take
in good faith which it believes to be authorized or within its rights or
powers; provided, however, that the Indenture Trustee’s conduct
does not constitute willful misconduct, negligence or bad faith.

 

(e)           The
Indenture Trustee may consult with counsel, and the advice or opinion of
counsel with respect to legal matters relating to this Indenture and the Notes
shall be full and complete authorization and protection from liability in
respect to any action taken, omitted or suffered by it hereunder in good faith
and in accordance with the advice or opinion of such counsel.

 

SECTION 6.3   Individual
Rights of Indenture Trustee. 
The Indenture Trustee in its individual or any other capacity may become
the owner or pledgee of Notes and may otherwise deal with the Issuer or its
Affiliates with the same rights it would have if it were not Indenture
Trustee.  Any Paying Agent, Note
Registrar, co-registrar or co-paying agent may do the same with like
rights.  However, the Indenture Trustee
must comply with Sections 6.11 and 6.12.

 

SECTION 6.4   Indenture
Trustee’s Disclaimer.  The
Indenture Trustee shall not be responsible for and makes no representation as
to the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuer’s use of the proceeds from the Notes, and it shall
not be responsible for any statement of the Issuer in the Indenture or in any
document issued in connection with the sale of the Notes or in the Notes other
than the Indenture Trustee’s certificate of authentication.

 

SECTION 6.5   Notice of
Defaults.  If a Default occurs
and is continuing and if it is either actually known or written notice of the
existence thereof has been delivered to a Responsible Officer of the Indenture
Trustee, the Indenture Trustee shall mail notice of the Default to each
Noteholder and any Swap Counterparty within 90 days and to each Rating Agency
as soon as practicable within 30 days after it occurs.  Except in the case of a Default in payment
of principal of or interest on any Note (including payments pursuant to the
mandatory redemption provisions of such Note), the Indenture Trustee may
withhold the notice if and so long as a committee of its Responsible Officers
in good faith determines that withholding the notice is in the interests of
Noteholders and any Swap Counterparty. 
Except as provided in the first sentence of this Section 6.5, in no
event shall the Indenture Trustee be deemed to have knowledge of a Default or
an Event of Default.

 

SECTION 6.6   Reports
by Indenture Trustee to Noteholders.  The Indenture Trustee shall deliver to each Noteholder (and to
each Person who was a Noteholder at any time during the applicable calendar
year) such information as may be required to enable such holder to prepare its
Federal and state income tax returns. 
Within 60 days after each December 31 beginning with the December 31
following the date of this Indenture, the Indenture Trustee shall mail to each
Noteholder a brief report as of such December 31 that complies with TIA §
313(a) if required by said section.  The
Indenture Trustee shall also comply with TIA § 313(b).  A copy of

 

37

 

each such report required pursuant to TIA §
313(a) or (b) shall, at the time of such transaction to Noteholders, be filed
by the Indenture Trustee with the Commission and with each securities exchange,
if any, upon which the Notes are listed, provided that the Issuer has
previously notified the Indenture Trustee of such listing.

 

SECTION 6.7   Compensation
and Indemnity.  The Issuer shall
cause the Depositor to pay to the Indenture Trustee reasonable compensation for
its services in accordance with a separate agreement between the Depositor and
the Indenture Trustee and shall cause the Depositor to reimburse the Indenture
Trustee for all reasonable out-of-pocket expenses incurred or made by it as
provided in such separate agreement. 
The Indenture Trustee’s compensation shall not be limited by any law on
compensation of a trustee of an express trust. 
The Issuer shall cause the Administrator to indemnify the Indenture
Trustee and its directors, officers, employees and agents against any and all
loss, liability or expense (including attorneys’ fees) incurred by it in
connection with the administration of this trust and the performance of its
duties hereunder and under the other Basic Documents.  The Indenture Trustee shall notify the Issuer and the
Administrator promptly of any claim for which it may seek indemnity.  Failure by the Indenture Trustee to so
notify the Issuer and the Administrator shall not relieve the Issuer or the
Administrator of its obligations hereunder and under the other Basic
Documents.  The Issuer shall cause the
Administrator to defend the claim and the Administrator shall not be liable for
the legal fees and expenses of the Indenture Trustee after it has assumed such
defense; provided, however, that, in the event that there may be
a conflict between the positions of the Indenture Trustee and the Administrator
in conducting the defense of such claim, the Indenture Trustee shall be
entitled to separate counsel acceptable to it in its sole discretion the
reasonable fees and expenses of which shall be paid by the Administrator on
behalf of the Issuer.  Neither the
Issuer nor the Administrator need reimburse any expense or indemnify against
any loss, liability or expense incurred by the Indenture Trustee through the
Indenture Trustee’s own willful misconduct, negligence or bad faith.

 

The Issuer’s payment obligations to the
Indenture Trustee pursuant to this Section shall survive the discharge of this
Indenture.  When the Indenture Trustee
incurs expenses after the occurrence of a Default specified in Section 5.1(iv)
or (v) with respect to the Issuer, the expenses are intended to constitute
expenses of administration under Title 11 of the United States Code or any
other applicable Federal or state bankruptcy, insolvency or similar law.

 

SECTION 6.8   Replacement
of Indenture Trustee.  No
resignation or removal of the Indenture Trustee and no appointment of a
successor Indenture Trustee shall become effective until the acceptance of
appointment by the successor Indenture Trustee pursuant to this Section
6.8.  The Indenture Trustee may resign
at any time by so notifying the Issuer. 
The Noteholders of at least a majority in Outstanding Amount of the
Notes may remove the Indenture Trustee by so notifying the Indenture Trustee
and may appoint a successor Indenture Trustee. 
The Issuer shall remove the Indenture Trustee if:

 

(i)            the Indenture Trustee
fails to comply with Section 6.11;

 

(ii)           an Insolvency Event
occurs with respect to the Indenture Trustee;

 

38

 

(iii)          a receiver or other
public officer takes charge of the Indenture Trustee or its property; or

 

(iv)          the Indenture Trustee otherwise
becomes incapable of acting.

 

If the Indenture Trustee resigns or is
removed or if a vacancy exists in the office of Indenture Trustee for any
reason (the Indenture Trustee in such event being referred to herein as the
retiring Indenture Trustee), the Issuer shall promptly appoint a successor
Indenture Trustee.

 

A successor Indenture Trustee shall deliver a
written acceptance of its appointment to the retiring Indenture Trustee and to
the Issuer.  Thereupon the resignation
or removal of the retiring Indenture Trustee shall become effective, and the
successor Indenture Trustee shall have all the rights, powers and duties of the
Indenture Trustee under this Indenture. 
The successor Indenture Trustee shall mail a notice of its succession to
Noteholders.  The retiring Indenture
Trustee shall promptly transfer all property held by it as Indenture Trustee to
the successor Indenture Trustee.

 

If a successor Indenture Trustee does not
take office within 60 days after the retiring Indenture Trustee resigns or is
removed, the retiring Indenture Trustee, the Issuer or the Noteholders of at
least a majority in Outstanding Amount of the Notes may petition any court of
competent jurisdiction for the appointment of a successor Indenture Trustee.  The successor Indenture Trustee shall give
notice of its appointment as successor Indenture Trustee to the Rating
Agencies.

 

If the Indenture Trustee fails to comply with
Section 6.11, any Noteholder may petition any court of competent jurisdiction
for the removal of the Indenture Trustee and the appointment of a successor
Indenture Trustee.

 

Notwithstanding the replacement of the
Indenture Trustee pursuant to this Section, the Issuer’s and the
Administrator’s obligations under Section 6.7 shall continue for the benefit of
the retiring Indenture Trustee.

 

SECTION 6.9   Successor
Indenture Trustee by Merger.  If
the Indenture Trustee consolidates with, merges or converts into, or transfers
all or substantially all of its corporate trust business or assets to, another
corporation or banking association, the resulting, surviving or transferee
corporation without any further act shall be the successor Indenture Trustee,
provided that such corporation or banking association shall be otherwise
qualified and eligible under Section 6.11. 
The Indenture Trustee shall provide the Rating Agencies prior written
notice of any such transaction.

 

In case at the time such successor or
successors by merger, conversion or consolidation to the Indenture Trustee
shall succeed to the trusts created by this Indenture any of the Notes shall
have been authenticated but not delivered, any such successor to the Indenture
Trustee may adopt the certificate of authentication of any predecessor trustee,
and deliver such Notes so authenticated; and in case at that time any of the
Notes shall not have been authenticated, any successor to the Indenture Trustee
may authenticate such Notes either in the name of any predecessor hereunder or
in the name of the successor to the Indenture Trustee; and

 

39

 

in all such
cases such certificates shall have the full force which it is anywhere in the
Notes or in this Indenture provided that the certificate of the Indenture
Trustee shall have.

 

SECTION 6.10   Appointment
of Co-Trustee or Separate Trustee.

 

(a)           Notwithstanding
any other provisions of this Indenture, at any time, for the purpose of meeting
any legal requirement of any jurisdiction in which any part of the Indenture
Trust Estate may at the time be located, the Indenture Trustee shall have the
power and may execute and deliver all instruments to appoint one or more
Persons to act as a co-trustee or co-trustees, or separate trustee or separate
trustees, of all or any part of the Indenture Trust Estate, and to vest in such
Person or Persons, in such capacity and for the benefit of the Noteholders,
such title to the Indenture Trust Estate, or any part hereof, and, subject to
the other provisions of this Section, such powers, duties, obligations, rights
and trusts as the Indenture Trustee may consider necessary or desirable.  No such appointment shall relieve the
Indenture Trustee of its obligations hereunder.  No co-trustee or separate trustee hereunder shall be required to
meet the terms of eligibility as a successor trustee under Section 6.11 and no
notice to Noteholders of the appointment of any co-trustee or separate trustee
shall be required under Section 6.8 hereof.

 

(b)           Every
separate trustee and co-trustee shall, to the extent permitted by law, be
appointed and act subject to the following provisions and conditions:

 

(i)            all rights, powers,
duties and obligations conferred or imposed upon the Indenture Trustee shall be
conferred or imposed upon and exercised or performed by the Indenture Trustee
and such separate trustee or co-trustee jointly (it being understood that such
separate trustee or co-trustee is not authorized to act separately without the
Indenture Trustee joining in such act), except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be performed the
Indenture Trustee shall be incompetent or unqualified to perform such act or
acts, in which event such rights, powers, duties and obligations (including the
holding of title to the Indenture Trust Estate or any portion thereof in any
such jurisdiction) shall be exercised and performed singly by such separate
trustee or co-trustee, but solely at the direction of the Indenture Trustee;

 

(ii)           no trustee hereunder
shall be personally liable by reason of any act or omission of any other
trustee hereunder; and

 

(iii)          the Indenture Trustee
may at any time accept the resignation of or remove any separate trustee or
co-trustee.

 

(c)           Any
notice, request or other writing given to the Indenture Trustee shall be deemed
to have been given to each of the then separate trustees and co-trustees, as
effectively as if given to each of them. 
Every instrument appointing any separate trustee or co-trustee shall
refer to this Indenture and the conditions of this Article VI.  Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Indenture Trustee or separately, as may be provided therein, subject to all the
provisions of this Indenture, specifically including every provision of this
Indenture relating to the conduct of, affecting the liability of, or affording

 

40

 

protection to, the Indenture Trustee.  Every such instrument shall be filed with
the Indenture Trustee.

 

(d)           Any
separate trustee or co-trustee may at any time constitute the Indenture
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Indenture on its behalf and in its name. 
If any separate trustee or co-trustee shall die, become incapable of
acting, resign or be removed, all of its estates, properties, rights, remedies
and trusts shall vest in and be exercised by the Indenture Trustee, to the
extent permitted by law, without the appointment of a new or successor trustee.

 

SECTION 6.11   Eligibility;
Disqualification.  The Indenture
Trustee shall at all times satisfy the requirements of TIA § 310(a), the
requirements of an “eligible lender” under 20 USC § 1085(d) and the
requirements of Rule 3a-7(4)(i) of the General Rules and Regulations under the
Investment Company Act of 1940, as amended. 
The Indenture Trustee shall have a combined capital and surplus of at
least $50,000,000 as set forth in its most recent published annual report of
condition and it shall have a long-term senior unsecured debt rating of not
less than investment grade by each of the Rating Agencies.  The Indenture Trustee shall comply with TIA
§ 310(b), including the optional provision permitted by the second sentence of
TIA § 310(b)(9); provided, however, that there shall be excluded
from the operation of TIA § 310(b)(1) any indenture or indentures under which
other securities of the Issuer are outstanding if the requirements for such
exclusion set forth in TIA § 310(b)(1) are met.

 

SECTION 6.12   Preferential Collection of
Claims Against the Issuer. 
The Indenture Trustee shall comply with TIA § 311(a), excluding any
creditor relationship listed in TIA § 311(b). 
An Indenture Trustee who has resigned or been removed shall be subject
to TIA § 311(a) to the extent indicated.

 

ARTICLE VII

 

Noteholders’
Lists and Reports

 

SECTION 7.1   Issuer
to Furnish Indenture Trustee Names and Addresses of Noteholders.  The Issuer will furnish or cause to be
furnished to the Indenture Trustee (a) not more than five days after the
earlier of (i) each Record Date and (ii) three months after the last Record
Date, a list, in such form as the Indenture Trustee may reasonably require, of
the names and addresses of the Noteholders as of such Record Date, and (b) at
such other times as the Indenture Trustee may request in writing, within 30
days after receipt by the Issuer of any such request, a list of similar form
and content as of a date not more than 10 days prior to the time such list is
furnished; provided, however, that so long as the Indenture
Trustee is the Note Registrar, no such list shall be required to be furnished.

 

SECTION 7.2   Preservation
of Information; Communications to Noteholders.  The Indenture Trustee shall preserve, in as
current a form as is reasonably practicable, the names and addresses of the
Noteholders contained in the most recent list furnished to the Indenture
Trustee as provided in Section 7.1 and the names and addresses of Noteholders
received by the

 

41

 

Indenture Trustee in its capacity as Note
Registrar.  The Indenture Trustee may
destroy any list furnished to it as provided in such Section 7.1 upon receipt
of a new list so furnished.

 

(a)           Noteholders
may communicate pursuant to TIA § 312(b) with other Noteholders with respect to
their rights under this Indenture or under the Notes.  Upon receipt by the Indenture Trustee of any request by three or
more Noteholders or by one or more holders of Notes evidencing not less than
25% of the Outstanding Amount of the Notes to receive a copy of the current
list of Noteholders (whether or not made pursuant to TIA § 312(b)), the Indenture
Trustee shall promptly notify the Administrator thereof by providing to the
Administrator a copy of such request and a copy of the list of Noteholders
produced in response thereto.

 

(b)           The
Issuer, the Indenture Trustee and the Note Registrar shall have the protection
of TIA § 312(c).

 

(c)           On
each Distribution Date the Indenture Trustee shall provide to each Noteholder
of record as of the related Record Date the information provided by the
Administrator to the Indenture Trustee on the related Determination Date
pursuant to Section 2.11 of the Administration Agreement.

 

(d)           The
Indenture Trustee shall furnish to the Noteholders promptly upon receipt of a
written request therefor, duplicates or copies of all reports, notices,
requests, demands, certificates, financial statements and any other instruments
furnished to the Indenture Trustee under the Basic Documents.  The Indenture Trustee shall furnish to the
Noteholders promptly upon receipt thereof from the Eligible Lender Trustee
notice of any amendment of the Administration Agreement pursuant to Section 8.5
of the Administration Agreement.

 

SECTION 7.3   Reports by Issuer.

 

(a)           The
Issuer shall:

 

(i)            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)
which the Issuer may be required to file with the Commission pursuant to
Section 13 or 15(d) of the Exchange Act;

 

(ii)           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

 

(iii)          supply to the Indenture
Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders
described in TIA § 313(c)) such summaries of any information, documents and
reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of
this Section 7.3(a) as may be required by rules and regulations prescribed from
time to time by the Commission.

 

42

 

(b)           Unless
the Issuer otherwise determines, the fiscal year of the Issuer shall end on
December 31 of each year.

 

ARTICLE VIII

 

Accounts,
Disbursements and Releases

 

SECTION 8.1   Collection of
Money.  Except as otherwise
expressly provided herein, the Indenture Trustee may demand payment or delivery
of, and shall receive and collect, directly and without intervention or
assistance of any fiscal agent or other intermediary, all money and other
property payable to or receivable by the Indenture Trustee pursuant to this
Indenture.  The Indenture Trustee shall
apply all such money received by it on behalf of Noteholders, any Swap
Counterparty or the Trust pursuant to the Administration Agreement as provided
in this Indenture.  Except as otherwise
expressly provided in this Indenture, if any default occurs in the making of
any payment or performance under any agreement or instrument that is part of
the Indenture Trust Estate, the Indenture Trustee may take such action as may
be appropriate to enforce such payment or performance, including the
institution and prosecution of appropriate Proceedings.  Any such action shall be without prejudice
to any right to claim a Default under this Indenture and any right to proceed
thereafter as provided in Article V.

 

SECTION 8.2   Trust Accounts.  (a)  On or prior to the Closing
Date, the Issuer shall cause the Administrator to establish and maintain, in
the name of the Indenture Trustee, for the benefit of the Noteholders, any Swap
Counterparty and the Trust, each of the Trust Accounts as provided in Section
2.3 of the Administration Agreement.

 

(b)           On
or before the Business Day immediately preceding each Distribution Date, all
Available Funds and amounts set forth in paragraph (a)(2) of the definition of
Available Funds with respect to the preceding Collection Period will be
deposited in the Collection Account as provided in Section 2.4 of the
Administration Agreement.  On or before
each Distribution Date, the Indenture Trustee (or any other Paying Agent) shall
make the required deposits and distributions as provided in Sections 2.7 and
2.8 of the Administration Agreement.

 

SECTION 8.3   General
Provisions Regarding Accounts. 
(a)  So long as no Default shall have occurred and be
continuing, all or a portion of the funds in the Trust Accounts shall be
invested in Eligible Investments and reinvested by the Indenture Trustee upon
Issuer Order, subject to the provisions of Section 2.3(b) of the Administration
Agreement.  All income or other gain
from investments of moneys deposited in the Trust Accounts shall be deposited
by the Indenture Trustee in the Collection Account, and any loss resulting from
such investments shall be charged to such Trust Account.  The Issuer will not direct the Indenture
Trustee to make any investment of any funds or to sell any investment held in
any of the Trust Accounts unless the security interest granted and perfected in
such account will continue to be perfected in such investment or the proceeds
of such sale, in either case without any further action by any Person, and, in
connection with any direction to the Indenture Trustee to make any such
investment or sale, if requested by the Indenture Trustee, the Issuer shall
deliver to the Indenture Trustee an Opinion of Counsel, acceptable to the
Indenture Trustee, to such effect.

 

43

 

(b)           Subject
to Section 6.1(c), the Indenture Trustee shall not in any way be held liable
for the selection of Eligible Investments or by reason of any insufficiency in
any of the Trust Accounts resulting from any loss on any Eligible Investment
included therein except for losses attributable to the Indenture Trustee’s
failure to make payments on such Eligible Investments issued by the Indenture
Trustee, in its commercial capacity as principal obligor and not as trustee, in
accordance with their terms.

 

(c)           If
(i) the Issuer shall have failed to give investment directions for any funds on
deposit in the Trust Accounts to the Indenture Trustee by 10:00 a.m.  Eastern Time (or such other time as may be
agreed by the Issuer and Indenture Trustee) on any Business Day; or (ii) a
Default shall have occurred and be continuing with respect to the Notes but the
Notes shall not have been declared due and payable pursuant to Section 5.2, or,
if such Notes shall have been declared due and payable following an Event of
Default, amounts collected or receivable from the Indenture Trust Estate are
being applied in accordance with Section 5.5 as if there had not been such a
declaration; then the Indenture Trustee shall invest and reinvest funds in the
Trust Accounts in the Eligible Investments described in clause (d) of the
definition thereof.

 

SECTION 8.4   Release
of Indenture Trust Estate. 
(a)  Subject to the payment of its fees and expenses pursuant
to Section 6.7, the Indenture Trustee may, and when required by the provisions
of this Indenture shall, execute instruments to release property from the lien
of this Indenture, or convey the Indenture Trustee’s interest in the same, in a
manner and under circumstances that are not inconsistent with the provisions of
this Indenture.  No party relying upon
an instrument executed by the Indenture Trustee as provided in this Article
VIII shall be bound to ascertain the Indenture Trustee’s authority, inquire
into the satisfaction of any conditions precedent or see to the application of
any moneys.

 

(b)           The
Indenture Trustee shall, at such time as there are no Notes Outstanding and all
sums due the Indenture Trustee pursuant to Section 6.7 have been paid, subject
to the interest therein of any Swap Counterparty, release any remaining portion
of the Indenture Trust Estate that secured the Notes from the lien of this
Indenture and release to the Issuer or any other Person entitled thereto any
funds then on deposit in the Trust Accounts. 
The Indenture Trustee shall release property from the lien of this
Indenture pursuant to this Section 8.4(b) only upon receipt of an Issuer
Request accompanied by an Officers’ Certificate of the Issuer, an Opinion of
Counsel and (if required by the TIA) Independent Certificates in accordance
with TIA §§ 314(c) and 314(d)(1) meeting the applicable requirements of Section
11.1.

 

(c)           Each
Noteholder, by the acceptance of a Note, acknowledges that from time to time
the Indenture Trustee shall release the lien of this Indenture on any Trust
Student Loan to be sold (i) to the Depositor in accordance with Section 6 of
the Sale Agreement, (ii) to the Servicer in accordance with Section 3.5 of the
Servicing Agreement, (iii) to SLM ECFC or another Affiliate of SLM Corporation
in accordance with Section 3.11F. of the Servicing Agreement, (iv) to another
eligible lender holding one or more Serial Loans with respect to such Trust
Student Loan or (v) to SLM ECFC in accordance with Section 6 of the Purchase
Agreement, and each Noteholder, by the acceptance of a Note, consents to any
such release.

 

SECTION 8.5   Opinion of Counsel.  The Indenture Trustee shall receive at least
seven days’ notice when requested by the Issuer to take any action pursuant to
Section 8.4(a),

 

44

 

accompanied by copies of any instruments
involved, and the Indenture Trustee shall also require, except in connection
with any action contemplated by Section 8.4(c), as a condition to such action,
an Opinion of Counsel, in form and substance satisfactory to the Indenture
Trustee, stating the legal effect of any such action, outlining the steps
required to complete the same, and concluding that all conditions precedent to
the taking of such action have been complied with and such action will not
materially and adversely impair the security for the Notes or the rights of the
Noteholders or any Swap Counterparty in contravention of the provisions of this
Indenture; provided, however, that such Opinion of Counsel shall
not be required to express an opinion as to the fair value of the Indenture
Trust Estate.  Counsel rendering any
such opinion may rely, without independent investigation, on the accuracy and
validity of any certificate or other instrument delivered to the Indenture
Trustee in connection with any such action.

 

ARTICLE IX

 

Supplemental
Indentures

 

SECTION 9.1   Supplemental Indentures Without
Consent of Noteholders.

 

(a)           Without
the consent of any Noteholders but with prior notice to the Rating Agencies,
the Issuer and the Indenture Trustee, when authorized by an Issuer Order, at
any time and from time to time, may enter into one or more indentures
supplemental hereto (which shall conform to the provisions of the Trust Indenture
Act as in force at the date of the execution thereof), in form satisfactory to
the Indenture Trustee, for any of the following purposes:

 

(i)            to correct or amplify
the description of any property at any time subject to the lien of this
Indenture, or better to assure, convey and confirm unto the Indenture Trustee
any property subject or required to be subjected to the lien of this Indenture,
or to subject to the lien of this Indenture additional property;

 

(ii)           to evidence the
succession, in compliance with the applicable provisions hereof, of another
person to the Issuer, and the assumption by any such successor of the covenants
of the Issuer herein and in the Notes contained;

 

(iii)          to add to the covenants
of the Issuer, for the benefit of the Noteholders and, any Swap Counterparty,
as applicable, or to surrender any right or power herein conferred upon the
Issuer;

 

(iv)          to convey, transfer,
assign, mortgage or pledge any property to the Indenture Trustee;

 

(v)           to cure any ambiguity,
to correct or supplement any provision herein or in any supplemental indenture
which may be inconsistent with any other provision herein or in any
supplemental indenture or to make any other provisions with respect to matters
or questions arising under this Indenture or in any supplemental indenture;
provided that such action shall not materially adversely affect the interests
of the Noteholders or any Swap Counterparty;

 

(vi)          to evidence and provide
for the acceptance of the appointment hereunder by a successor trustee with respect
to the Notes and to add to or change any of the

 

45

 

provisions of
this Indenture as shall be necessary to facilitate the administration of the
trusts hereunder by more than one trustee, pursuant to the requirements of
Article VI; or

 

(vii)         to modify, eliminate or
add to the provisions of this Indenture to such extent as shall be necessary to
effect the qualification of this Indenture under the TIA or under any similar
Federal statute hereafter enacted and to add to this Indenture such other
provisions as may be expressly required by the TIA.

 

The Indenture Trustee is hereby authorized to
join in the execution of any such supplemental indenture and to make any
further appropriate agreements and stipulations that may be therein contained.

 

(b)           The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also
without the consent of any of the Noteholders but with prior notice to any Swap
Counterparty and the Rating Agencies, enter into an indenture or indentures
supplemental hereto for the purpose of adding any provisions to, or changing in
any manner or eliminating any of the provisions of, this Indenture or of
modifying in any manner the rights of the Noteholders or any Swap Counterparty
under this Indenture; provided, however, that such action shall
not, as evidenced by an Opinion of Counsel, adversely affect in any material
respect the interests of any Noteholder or any Swap Counterparty.

 

SECTION 9.2   Supplemental
Indentures with Consent of Noteholders.

 

(a)           The
Issuer and the Indenture Trustee, when authorized by an Issuer Order, also may,
with prior notice to any Swap Counterparty and the Rating Agencies and with the
consent of the Noteholders of at least a majority of the Outstanding Amount of
the Notes, by Act of such Noteholders delivered to the Issuer and the Indenture
Trustee, enter into an indenture or indentures supplemental hereto for the
purpose of adding any provisions to, or changing in any manner or eliminating
any of the provisions of, this Indenture or of modifying in any manner the
rights of the Noteholders under this Indenture;  provided, however, that no such supplemental
indenture shall, without the consent of the Noteholder of each Outstanding Note
affected thereby:

 

(i)            change the date of
payment of any installment of principal of or interest on any Note, or reduce
the principal amount thereof, the interest rate thereon or the Redemption Price
with respect thereto, change the provisions of this Indenture relating to the
application of collections on, or the proceeds of the sale of, the Indenture
Trust Estate to payment of principal of or interest on the Notes, or change any
place of payment where, or the coin or currency in which, any Note or the
interest thereon is payable (other than pursuant to the terms and conditions of
the Reset Rate Notes or pursuant to the Reset Rate Note Procedures set forth in
Appendix A-2 to this Indenture) or impair the right to institute suit for the
enforcement of the provisions of this Indenture requiring the application of
funds available therefor, as provided in Article V, to the payment of any such
amount due on the Notes on or after the respective due dates thereof (or, in
the case of redemption, on or after the Redemption Date);

 

(ii)           reduce the percentage
of the Outstanding Amount of the Notes, the consent of the Noteholders of which
is required for any such supplemental indenture, or the

 

46

 

consent of the
Noteholders of which is required for any waiver of compliance with certain
provisions of this Indenture or certain defaults hereunder and their
consequences provided for in this Indenture;

 

(iii)          modify or alter the
provisions of the proviso to the definition of the term “Outstanding”;

 

(iv)          reduce the percentage of
the Outstanding Amount of the Notes required to direct the Indenture Trustee to
direct the Issuer to sell or liquidate the Indenture Trust Estate pursuant to
Section 5.4;

 

(v)           modify any provision of
this Section except to increase any percentage specified herein or to provide
that certain additional provisions of this Indenture or the other Basic
Documents cannot be modified or waived without the consent of the Noteholder of
each Outstanding Note affected thereby;

 

(vi)          modify any of the
provisions of this Indenture in such manner as to affect the calculation of the
amount of any payment of interest or principal due on any Note on any
Distribution Date (including the calculation of any of the individual
components of such calculation) or to affect the rights of the Noteholders to
the benefit of any provisions for the mandatory redemption of the Notes
contained herein; or

 

(vii)         permit the creation of
any lien ranking prior to or on a parity with the lien of this Indenture with
respect to any part of the Indenture Trust Estate or, except as otherwise
permitted or contemplated herein, terminate the lien of this Indenture on any
property at any time subject hereto or deprive any Noteholder of any Note of
the security provided by the lien of this Indenture;

 

provided, however,
that such action shall not, as evidenced by an Opinion of Counsel, adversely
affect in any material respect the interests of any Swap Counterparty.

 

It shall not be necessary for any Act of
Noteholders under this Section to approve the particular form of any proposed
supplemental indenture, but it shall be sufficient if such Act shall approve
the substance thereof.

 

Promptly after the execution by the Issuer
and the Indenture Trustee of any supplemental indenture pursuant to this
Section, the Indenture Trustee shall mail to the Noteholders of the Notes to
which such amendment or supplemental indenture relates a notice setting forth
in general terms the substance of such supplemental indenture.  Any failure of the Indenture Trustee to mail
such notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.

 

SECTION 9.3   Execution
of Supplemental Indentures.  In
executing, or permitting the additional trusts created by, any supplemental
indenture permitted by this Article IX or the modifications thereby of the
trusts created by this Indenture, the Indenture Trustee shall be entitled to
receive, and subject to Sections 6.1 and 6.2, shall be fully protected in
relying upon, an Opinion of Counsel stating that the execution of such
supplemental indenture is authorized or permitted by this Indenture.  The Indenture Trustee may, but shall not be
obligated

 

47

 

to, enter into any such supplemental
indenture that affects the Indenture Trustee’s own rights, duties, liabilities
or immunities under this Indenture or otherwise.

 

SECTION 9.4   Effect
of Supplemental Indenture.  Upon
the execution of any supplemental indenture pursuant to the provisions hereof,
this Indenture shall be and be deemed to be modified and amended in accordance
therewith with respect to the Notes affected thereby, and the respective
rights, limitations of rights, obligations, duties, liabilities and immunities
under this Indenture of the Indenture Trustee, the Issuer and the Noteholders
shall thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.

 

SECTION 9.5   Conformity
with Trust Indenture Act.  Every
amendment of this Indenture and every supplemental indenture executed pursuant
to this Article IX shall conform to the requirements of the Trust Indenture Act
as then in effect so long as this Indenture shall then be qualified under the
Trust Indenture Act.

 

SECTION 9.6   Reference
in Notes to Supplemental Indentures.  Notes authenticated and delivered after the execution of any
supplemental indenture pursuant to this Article IX may, and if required by the
Indenture Trustee shall, bear a notation in form approved by the Indenture
Trustee as to any matter provided for in such supplemental indenture.  If the Issuer or the Indenture Trustee shall
so determine, new Notes so modified as to conform, in the opinion of the
Indenture Trustee and the Issuer, to any such supplemental indenture may be
prepared and executed by the Issuer and authenticated and delivered by the
Indenture Trustee in exchange for Outstanding Notes.

 

ARTICLE X

 

Redemption of
Notes

 

SECTION 10.1   Redemption.  The Indenture Trustee shall, upon receipt of
written notice from the Servicer pursuant to Section 6.1(b) of the
Administration Agreement, give prompt written notice to the Noteholders of the
occurrence of such event.  In the event
that the assets of the Trust are sold pursuant to Section 6.1(a) of the
Administration Agreement, that portion of the amounts on deposit in the Trust
Accounts to be distributed to the Noteholders shall be paid to the Noteholders
as provided in Sections 2.7 and 2.8 of the Administration Agreement.  If amounts are to be paid to Noteholders
pursuant to this Section 10.1, the notice of such event from the Indenture
Trustee to the Noteholders shall include notice of the redemption of Notes by
application of such amounts on the next Distribution Date which is not sooner
than 15 days after the date of such notice (the “Redemption Date”), whereupon
all such amounts shall be payable on the Redemption Date.

 

SECTION 10.2   Form of
Redemption Notice.  Notice of
redemption under Section 10.1 shall be given by the Indenture Trustee by
first-class mail, postage prepaid, or by facsimile, mailed or transmitted on or
prior to the applicable Redemption Date to each Noteholder, as of the close of
business on the Record Date preceding the applicable Redemption Date, at such
Noteholder’s address or facsimile number appearing in the Note Register.

 

48

 

All notices of redemption shall state:

 

(i)            the Redemption Date;

 

(ii)           the Redemption Price;
and

 

(iii)          the place where such
Notes are to be surrendered for payment of the Redemption Price (which shall be
the office or agency of the Issuer to be maintained as provided in Section
3.2).

 

Notice of redemption of the Notes shall be
given by the Indenture Trustee in the name and at the expense of the
Issuer.  Failure to give notice of
redemption, or any defect therein, to any Noteholder of any Note shall not
impair or affect the validity of the redemption of any other Note.

 

SECTION 10.3   Notes
Payable on Redemption Date.  The
Notes or portions thereof to be redeemed shall on the Redemption Date become
due and payable at the Redemption Price and (unless the Issuer shall default in
the payment of the Redemption Price) no interest shall accrue on the Redemption
Price for any period after the date to which accrued interest is calculated for
purposes of calculating the Redemption Price.

 

ARTICLE XI

 

Miscellaneous

 

SECTION 11.1   Compliance Certificates and
Opinions, etc. 
(a)  Upon any application or request by the Issuer to the
Indenture Trustee to take any action under any provision of this Indenture, the
Issuer shall furnish to the Indenture Trustee and the Rating Agencies (i) an
Officers’ Certificate of the Issuer 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 TIA) an Independent Certificate from a firm of
certified public accountants meeting the applicable requirements of this
Section, 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, 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
statements or opinions contained in such certificate or opinion are based;

 

49

 

(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)           (i)            Prior to the deposit
of any Collateral or other property or securities with the Indenture Trustee
that is to be made the basis for the release of any property or securities
subject to the lien of this Indenture, the Issuer shall, in addition to any
obligation imposed in Section 11.1(a) or elsewhere in this Indenture, furnish
to the Indenture Trustee and the Rating Agencies an Officers’ Certificate of
the Issuer 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 Collateral or other property or securities to be so deposited.

 

(ii)           Whenever the Issuer is
required to furnish to the Indenture Trustee and the Rating Agencies an
Officers’ Certificate of the Issuer certifying or stating the opinion of any
signer thereof as to the matters described in clause (i) above, the Issuer
shall also deliver to the Indenture Trustee an Independent Certificate as to
the same matters, if the fair value to the Issuer of the securities to be so
deposited and of all other such securities 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 clause (i) above
and this clause (ii), is 10% or more of the Outstanding Amount of the Notes,
but such a certificate need not be furnished with respect to any securities so
deposited, if the fair value thereof to the Issuer as set forth in the related
Officers’ Certificate is less than $25,000 or less than one percent of the
Outstanding Amount of the Notes.

 

(iii)          Other than any property
released as contemplated by clause (v) below, whenever any property or
securities are to be released from the lien of this Indenture, the Issuer shall
also furnish to the Indenture Trustee an Officers’ Certificate of the Issuer
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 under this Indenture in
contravention of the provisions hereof.

 

(iv)          Whenever the Issuer is
required to furnish to the Indenture Trustee an Officers’ Certificate of the
Issuer certifying or stating the opinion of any signer thereof as to the matters
described in clause (iii) above, the Issuer shall also furnish to the Indenture
Trustee an Independent Certificate as to the same matters if the fair value of
the property or securities and of all other property, other than property as
contemplated by clause (v) below, or securities released from the lien of this
Indenture since the commencement of the then-current calendar year, as set
forth in the certificates required by clause (iii) above and this clause (iv),
equals 10% or more of the Outstanding Amount of the Notes, but such certificate
need not be furnished in the case of any release of property or securities if
the fair value thereof as set forth in the related Officers’ Certificate is
less than $25,000 or less than one percent of the then Outstanding Amount of
the Notes.

 

50

 

(v)           Notwithstanding Section
2.9 or any other provision of this Section, the Issuer may, without compliance
with the requirements of the other provisions of this Section, (A) collect,
liquidate, sell or otherwise dispose of Trust Student Loans as and to the
extent permitted or required by the Basic Documents, (B) make cash payments out
of the Trust Accounts as and to the extent permitted or required by the Basic
Documents and (C) convey to the Depositor, the Servicer or another eligible
lender those specified Trust Student Loans as and to the extent permitted or
required by and in accordance with Section 8.4(c) hereof and Section 6 of the
Sale Agreement, Section 3.5 of the Servicing Agreement or Section 3.11E of the
Servicing Agreement, respectively, so long as the Issuer shall deliver to the
Indenture Trustee every six months, commencing December 31, 2004, an
Officers’ Certificate of the Issuer stating that all the dispositions of
Collateral described in clauses (A), (B) or (C) above that occurred during the
immediately preceding six calendar months were in the ordinary course of the
Issuer’s business and that the proceeds thereof were applied in accordance with
the Basic Documents.

 

SECTION 11.2   Form of Documents Delivered to
Indenture Trustee.  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.

 

Any certificate or opinion of an Authorized
Officer of the Issuer may be based, insofar as it relates to legal matters,
upon a certificate or opinion of, or representations by, counsel, unless such
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 of an Authorized
Officer 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
officers of the Servicer, the Depositor, the Issuer or the Administrator, stating
that the information with respect to such factual matters is in the possession
of the Servicer, the Depositor, the Issuer or the Administrator, 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.

 

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.

 

Whenever in this 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 the
granting of 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 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

 

51

 

truth and
accuracy of any statement or opinion contained in any such document as provided
in Article VI.

 

SECTION 11.3   Acts of
Noteholders.  (a)  Any
request, demand, authorization, direction, notice, consent, waiver or other
action provided by this Indenture to be given or taken by Noteholders may be
embodied in and evidenced by one or more instruments of substantially similar
tenor signed by such Noteholders in person or by agents duly appointed in
writing; and except as herein otherwise expressly provided such action shall
become effective when such instrument or instruments are delivered to the
Indenture Trustee, and, where it is hereby expressly required, to the
Issuer.  Such instrument or instruments
(and the action embodied therein and evidenced thereby) are herein sometimes
referred to as the “Act” of the Noteholders signing such instrument or
instruments.  Proof of execution of any
such instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 6.1) conclusive in
favor of the Indenture Trustee and the Issuer, if made in the manner provided
in this Section.

 

(b)           The
fact and date of the execution by any person of any such instrument or writing
may be proved in any manner that the Indenture Trustee deems sufficient.

 

(c)           The
ownership of Notes shall be proved by the Note Register.

 

(d)           Any
request, demand, authorization, direction, notice, consent, waiver or other
action by any Noteholder shall bind the Noteholder of every Note issued upon
registration of transfer thereof or in exchange therefor or in lieu thereof, in
respect of anything done, omitted or suffered to be done by the Indenture
Trustee or the Issuer in reliance thereon, whether or not notation of such
action is made upon such Note.

 

SECTION 11.4   Notices,
etc., to Indenture Trustee, Issuer and Rating Agencies.  Any request, demand, authorization,
direction, notice, consent, waiver or Act of Noteholders or other documents
provided or permitted by this Indenture shall be in writing and if such
request, demand, authorization, direction, notice, consent, waiver or Act of
Noteholders is to be made upon, given or furnished to or filed with:

 

(a)           The
Indenture Trustee by any Noteholder, the Servicer, the Administrator or by the
Issuer shall be sufficient for every purpose hereunder if made, given,
furnished or filed in writing to or with the Indenture Trustee at its Corporate
Trust Office with a copy to: Deutsche Bank Trust Company Americas, 60 Wall
Street, 26th Floor, Mailstop NYC60-2606, New York, New York 10005,
Attention: Trust & Securities Services/Structured Finance Services.

 

(b)           The
Issuer by the Indenture Trustee or by any Noteholder shall be sufficient for
every purpose hereunder if in writing and mailed, first-class, postage prepaid,
to the Issuer addressed to: SLM Student Loan Trust 2004-8, in care of Chase
Manhattan Bank USA, National Association, Christiana Center/OPS4, 500 Stanton
Christiana Road, Newark,  Delaware
19713, Attention:  Corporate Trust
Department; with copies to JPMorgan Chase Bank, 450 West 33rd Street 15th Fl.,
New York, New York 10001, Attention: 
Structured Finance Services; and the Administrator, 12061 Bluemont Way,
V3419, Reston, Virginia 20190, Attention: ABS Trust Administration, or any
other address previously furnished in writing to the Indenture Trustee by

 

52

 

the Issuer or the Administrator.  The Issuer shall promptly transmit any
notice received by it from the Noteholders to the Indenture Trustee.

 

Notices required to be given to the Rating
Agencies by the Issuer, the Indenture Trustee or the Eligible Lender Trustee
shall be in writing, personally delivered or mailed by certified mail, return
receipt requested, to (i) in the case of Moody’s, at the following address: ABS
Monitoring Department, 99 Church Street, New York, New York 10007, (ii) in the
case of S&P, at the following address: 55 Water Street, New York, New York
10041-0003, Attention: Asset Backed Surveillance Department, 32nd Floor, and
(iii) in the case of Fitch, at the following address: One State Street Plaza,
New York, New York 10004, Attention: Municipal Structured Finance Group; or as
to each of the foregoing, at such other address as shall be designated by
written notice to the other parties.

 

Notices to any Swap Counterparty will be sent
to the addresses set forth in the related Swap Agreement or the Interest Rate
Cap Agreement, respectively or such other addresses as may be designated by
written notice to the parties to this Indenture.

 

SECTION 11.5   Notices
to Noteholders; Waiver.  Where
this Indenture provides for notice to Noteholders of any event, such notice
shall be sufficiently given (unless otherwise herein expressly provided) if in
writing and mailed, first-class, postage prepaid to each Noteholder affected by
such event, at his address as it appears on the Note Register, not later than
the latest date, and not earlier than the earliest date, prescribed for the
giving of such notice.  In any case
where notice to Noteholders is given by mail, neither the failure to mail such
notice nor any defect in any notice so mailed to any particular Noteholder
shall affect the sufficiency of such notice with respect to other Noteholders,
and any notice that is mailed in the manner herein provided shall conclusively
be presumed to have been duly given.

 

Where this Indenture provides for notice in
any manner, such notice may be waived in writing by any Person entitled to
receive such notice, either before or after the event, and such waiver shall be
the equivalent of such notice.  Waivers
of notice by Noteholders shall be filed with the Indenture Trustee but such
filing shall not be a condition precedent to the validity of any action taken
in reliance upon such a waiver.

 

In case, by reason of the suspension of
regular mail service as a result of a strike, work stoppage or similar
activity, it shall be impractical to mail notice of any event to Noteholders
when such notice is required to be given pursuant to any provision of this
Indenture, then any manner of giving such notice as shall be satisfactory to
the Indenture Trustee shall be deemed to be a sufficient giving of such notice.

 

Where this Indenture provides for notice to
the Rating Agencies, failure to give such notice shall not affect any other
rights or obligations created hereunder, and shall not under any circumstance
constitute a Default.

 

SECTION 11.6   Alternate Payment and Notice
Provisions.  Notwithstanding any
provision of this Indenture or any of the Notes to the contrary, the Issuer may
enter into any agreement with any Noteholder providing for a method of payment,
or notice by the Indenture Trustee or any Paying Agent to such Noteholder, that
is different from the methods provided for

 

53

 

in this Indenture for such payments or
notices.  The Issuer will furnish to the
Indenture Trustee a copy of each such agreement and the Indenture Trustee will
cause payments to be made and notices to be given in accordance with such
agreements.

 

SECTION 11.7   Conflict
with Trust Indenture Act.  If
any provision hereof limits, qualifies or conflicts with another provision
hereof that is required to be included in this Indenture by any of the
provisions of the Trust Indenture Act, such required provision shall control.

 

The provisions of TIA §§ 310 through 317 that
impose duties on any Person (including the provisions automatically deemed
included herein unless expressly excluded by this Indenture) are a part of and
govern this Indenture, whether or not physically contained herein.

 

SECTION 11.8   Effect
of Headings and Table of Contents. 
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.

 

SECTION 11.9   Successors
and Assigns.  All covenants and
agreements in this Indenture and the Notes by the Issuer shall bind its
successor and assigns, whether so expressed or not.  All agreements of the Indenture Trustee in this Indenture shall
bind the successors, co-trustees and agents (excluding any legal
representatives or accountants) of the Indenture Trustee.

 

SECTION 11.10   Separability.  In case any provision in this Indenture or
in the Notes shall be invalid, illegal or unenforceable, the validity,
legality, and enforceability of the remaining provisions shall not in any way
be affected or impaired thereby.

 

SECTION 11.11   Benefits of
Indenture.  (a)  Except
as set forth in paragraphs (b) and (c) below, nothing in this Indenture or in
the Notes, express or implied shall give to any person, other than the parties
hereto and their successors hereunder, the Noteholders, any other party secured
hereunder, and any other Person with an ownership interest in any part of the
Indenture Trust Estate, any benefit or any legal or equitable right, remedy or
claim under this Indenture.

 

(b)           The
parties to this Indenture acknowledge and agree that each Swap Counterparty is
an intended third party beneficiary of this Indenture to the extent of its
rights hereunder and under the related Swap Agreement entered into by the
Issuer from time to time and shall be entitled to enforce such rights.

 

(c)           The
parties to this Indenture acknowledge and agree that SLM Corporation, and any
permitted transferee, if applicable, is an intended third party beneficiary of
this Indenture to the extent of its rights with respect to the Call Option as
set forth in Section 7 of Appendix A-2 hereto and shall be entitled to enforce
such rights.

 

SECTION 11.12   Legal Holidays.  In any case where the date on which any
payment is due shall not be a Business Day, then (notwithstanding any other
provision of the Notes or this Indenture) payment need not be made on such
date, but may be made on the next

 

54

 

succeeding Business Day with the same force
and effect as if made on the date on which nominally due, and no interest shall
accrue for the period from and after any such nominal date.

 

SECTION 11.13   GOVERNING LAW.  THIS
INDENTURE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER THAN §5-1401
OF THE NEW YORK GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.

 

SECTION 11.14   Counterparts.  This Indenture may be executed in any number
of counterparts, each of which so executed shall be deemed to be an original,
but all such counterparts shall together constitute but one and the same
instrument.

 

SECTION 11.15   Recording
of Indenture.  If this Indenture
is subject to recording in any appropriate public recording offices, such
recording is to be effected by the Issuer and at its expense accompanied by an
Opinion of Counsel (which may be counsel to the Indenture Trustee or any other
counsel reasonably acceptable to the Indenture Trustee) to the effect that such
recording is necessary either for the protection of the Noteholders or any
other Person secured hereunder or for the enforcement of any right or remedy
granted to the Indenture Trustee under this Indenture.

 

SECTION 11.16   Trust
Obligations.  No recourse may be
taken, directly or indirectly, with respect to the obligations of the Issuer,
the Depositor, the Administrator, the Servicer, the Eligible Lender Trustee or
the Indenture Trustee on the Notes or under this Indenture or any certificate
or other writing delivered in connection herewith or therewith, against (i) the
Indenture Trustee or the Eligible Lender Trustee in its individual capacity,
(ii) any owner of a beneficial interest in the Issuer or (iii) any partner,
owner, beneficiary, agent, officer, director or employee of the Indenture
Trustee or the Eligible Lender Trustee in its individual capacity, any holder
or owner of a beneficial interest in the Issuer, the Eligible Lender Trustee or
the Indenture Trustee or of any successor or assign thereof in its individual
capacity, except as any such Person may have expressly agreed (it being
understood that the Indenture Trustee and the Eligible Lender Trustee have no
such obligations in their individual capacity) and except that any such
partner, owner or beneficiary shall be fully liable, to the extent provided by
applicable law, for any unpaid consideration for stock, unpaid capital
contribution or failure to pay any installment or call owing to such
entity.  For all purposes of this
Indenture, in the performance of any duties or obligations of the Issuer
hereunder, the Eligible Lender Trustee shall be subject to, and entitled to the
benefits of, the terms and provisions of Articles VI, VII and VIII of the Trust
Agreement.

 

SECTION 11.17   No Petition.  The Indenture Trustee, by entering into this
Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree
that they shall not at any time institute against the Depositor or the Issuer,
or join in any institution against the Depositor or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency, receivership or
liquidation proceedings, or other proceedings under any United States Federal
or state bankruptcy or similar law in connection with any obligations relating
to the Notes, this Indenture or any of the other Basic Documents.  The foregoing shall not limit the rights of
the Indenture

 

55

 

Trustee to file any claim in, or otherwise
take any action with respect to, any insolvency proceeding that was instituted
against the Issuer by any Person other than the Indenture Trustee.

 

SECTION 11.18   Inspection.  The Issuer agrees that, on reasonable prior
notice, it shall permit any representative of the Indenture Trustee, during the
Issuer’s normal business hours, to examine all the books of account, records,
reports, and other papers of the Issuer, to make copies and extracts therefrom,
to cause such books to be audited by Independent certified public accountants,
and to discuss the Issuer’s affairs, finances and accounts with the Issuer’s
officers, employees, and Independent certified public accountants, all at such
reasonable times and as often as may be reasonably requested.  The Indenture Trustee shall and shall cause
its representatives to hold in confidence all such information obtained from
such examination or inspection except to the extent disclosure may be required
by law (and all reasonable applications for confidential treatment are
unavailing) and except to the extent that the Indenture Trustee may reasonably
determine that such disclosure is consistent with its obligations hereunder.

 

SECTION 11.19   Subordination.  All rights and interest of each Currency
Swap Counterparty in the security interest granted to the Indenture Trustee
under this Indenture shall be fully subordinated to the interests of the
Noteholders.  No Currency Swap
Counterparty shall have any rights, implied or otherwise, in the Collateral
until after the Outstanding Amount of the Notes has been reduced to zero and
the Noteholders have been paid all amounts owed to them under this
Indenture.  Notwithstanding the
foregoing, the provisions of this Section 11.19 shall not modify or
otherwise affect the contractual priority of payments set forth in Section 5.4(b)
hereof or Section 2.8 of the Administration Agreement.  More specifically, no Currency Swap
Counterparty shall have any voting rights or rights to exercise any remedies
under this Indenture until after the Outstanding Amount of the Notes has been
reduced to zero and the Noteholders have been paid all amounts owed to them
under this Indenture.  After the
Outstanding Amount of the Notes has been reduced to zero and the Noteholders
have been paid all amounts owed to them under this Indenture, each Currency
Swap Counterparty shall have all of the rights and obligations, including all
voting rights, of the Noteholders set forth in this Indenture.

 

56

 

IN WITNESS WHEREOF, the Issuer, the Eligible
Lender Trustee and the Indenture 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.

 

	
   

  	
  SLM STUDENT LOAN TRUST 2004-8

  
	
   

  
	
   

  	
  By: CHASE MANHATTAN BANK USA, NATIONAL

  ASSOCIATION, not in its individual capacity but solely as

  Eligible Lender Trustee

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
  /s/

  	
  JOHN J. CASHIN

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John J. Cashin

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  
	
   

  
	
   

  	
  CHASE MANHATTAN BANK USA, NATIONAL

  ASSOCIATION, not in its individual capacity but solely as

  Eligible Lender Trustee

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
  /s/

  	
  JOHN J. CASHIN

  	
   

  
	
   

  	
   

  	
  Name:

  	
  John J. Cashin

  
	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  
	
   

  
	
   

  	
  DEUTSCHE BANK TRUST COMPANY AMERICAS,

  not in its individual capacity but solely

  as Indenture Trustee

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   

  	
  /s/

  	
  MICHELE H.Y. VOON

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Michele H.Y. Voon

  
	
   

  	
   

  	
  Title:

  	
  Assistant Vice President

  
								

 

57

 

APPENDIX A-1

 

DEFINITIONS AND USAGE

Series
2004-8

 

Usage

 

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

 

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

 

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

 

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

 

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

 

(e)           Any agreement,
instrument or statute defined or referred to below or 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 assignment, assumption, 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-1-1

 

“30/360”
means that interest is calculated on the basis of a 360-day year consisting of
twelve 30-day months.

 

“91-day
Treasury Bill Rate” means, for any relevant Interest Rate Determination
Date, prior to each Interest Rate Change Date, the rate equal to the weighted
average per annum discount rate (expressed as a bond equivalent yield and
applied on a daily basis) for direct obligations of the United States with a
maturity of thirteen weeks (“91-day Treasury Bills”) sold at the applicable
91-day Treasury Bill auction, as published in H.15(519) or otherwise or as
reported by the U.S.  Department of the
Treasury.  In the event that the results
of the auctions of 91-day Treasury Bills cease to be published or reported as
provided above, or that no 91-day Treasury Bill auction is held in a particular
week, then the 91-day Treasury Bill Rate in effect as a result of the last such
publication or report will remain in effect until such time, if any, as the
results of auctions of 91-day Treasury Bills will again be so published or
reported or such auction is held, as the case may be.  The 91-day Treasury Bill Rate will be subject to a Lock-In Period
of six Business Days.

 

“Accrual
Period” means, with respect to a Distribution Date and (i) each class
of Notes bearing a floating rate of interest (including, without limitation,
the Floating Rate Notes and any class of Reset Rate Notes that bears interest
at a floating rate), the period from and including the immediately preceding
Distribution Date for such class of Notes to but excluding the then-current
Distribution Date, or in the case of the initial such period for such class of
Notes, the period from and including the Closing Date to and including October
25, 2004; provided that if more than one Interest Rate Change Date
occurs for any class of Reset Rate Notes bearing a floating rate of interest
within any given Accrual Period, the rate of interest for the entire Accrual
Period shall be as specified in the relevant Remarketing Terms Notice; and
(ii) any class of Reset Rate Notes bearing a fixed rate of interest and
(x) is denominated in U.S. Dollars, the period from and including the 25th
day of the month of the last applicable Distribution Date, to and including the
24th day of the month of the then-current applicable Distribution
Date for such class of Reset Rate Notes, or (y) is denominated in a currency
other than U.S. Dollars, (A) the period from and including the 25th
day of the month of the last applicable Distribution Date, to and including the
24th day of the month of the then-current applicable Distribution
Date or (B) as otherwise specified on the Schedule A for the Reset Rate Notes.

 

“Accumulation
Account” means each account designated as such, established and maintained
pursuant to Section 2.3(j) of the Administration Agreement.

 

“Act”
means the Securities Act of 1933, as amended.

 

“Actual/360”
means that interest is calculated on the basis of the actual number of days
elapsed in a year of 360 days.

 

“Actual/365
(fixed)” means that interest is calculated on the basis of the actual
number of days elapsed in a year of 365 days, regardless of whether accrual or
payment occurs in a leap year.

 

“Actual/Actual
(accrual basis)” means that interest is calculated on the basis of the
actual number of days elapsed in a year of 365 days, or 366 days for every day
in a leap year.

 

A-1-2

 

“Actual/Actual
(ISMA)” means a calculation in accordance with the definition of
“Actual/Actual” adopted by the International Securities Market Association
(“ISMA”), which means that interest is calculated on the following basis:

 

(1)           where
the number of days in the relevant Accrual Period is equal to or shorter than
the Determination Period during which such Accrual Period ends, the number of
days in such Accrual Period divided by the product of (A) the number of days in
such Determination Period and (B) the number of Distribution Dates that would
occur in one calendar year; or

 

(2)           where
the Accrual Period is longer than the Determination Period during which the
Accrual Period ends, the sum of:

 

(A)          the
number of days in such Accrual Period falling in the Determination Period in
which the Accrual Period begins divided by the product of (x) the number of
days in such Determination Period and (y) the number of Distribution Dates that
would occur in one calendar year; and

 

(B)           the
number of days in such Accrual Period falling in the next Determination Period
divided by the product of (x) the number of days in such Determination Period
and (y) the number of Distribution Dates that would occur in one calendar year;

 

where
“Determination Period” means the period from and including one Calculation Date
to but excluding the next Calculation Date and “Calculation Date” means, in
each year, each of those days in the calendar year that are specified herein as
being the scheduled Distribution Dates.

 

“Actual/Actual
(payment basis)” means that interest is calculated on the basis of the
actual number of days elapsed in a year of 365 days if the interest period ends
in a non-leap year, or 366 days if the interest period ends in a leap year, as the
case may be.

 

“Adjusted
Pool Balance” means, for any Distribution Date, (a) if the Pool Balance as
of the last day of the related Collection Period is greater than 40% of the
Initial Pool Balance, the sum of that Pool Balance, Capitalized Interest and the
Specified Reserve Account Balance for that Distribution Date or (b) if the Pool
Balance as of the last day of the related Collection Period is less than or
equal to 40% of the Initial Pool Balance, the sum of that Pool Balance and
Capitalized Interest.

 

“Administration
Agreement” means the Administration Agreement, dated as of August 25, 2004,
among the Administrator, the Servicer, the Depositor, the Trust and the
Eligible Lender Trustee, and as such agreement may be further amended or
supplemented from time to time.

 

“Administration
Fees” has the meaning specified in Section 2.14 of the Administration
Agreement.

 

“Administrator”
means Sallie Mae, Inc., in its capacity as administrator of the Trust in
accordance with the Administration Agreement.

 

A-1-3

 

“Administrator
Default” has the meaning specified in Section 5.1 of the Administration
Agreement.

 

“Administrator’s
Certificate” means an Officers’ Certificate of the Administrator delivered
pursuant to Section 3.1(c) of the Administration Agreement.

 

“Administrator’s
Officers’ Certificate” means any Officers’ Certificate of the Administrator
delivered pursuant to Section 3.1(b) 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 ownership of voting securities, by contract or otherwise;
and the terms “controlling” and “controlled” have meanings correlative to the
foregoing.

 

“All Hold
Rate” means, if a class of Reset Rate Notes is denominated in U.S. Dollars
during the then-current Reset Period and the immediately following Reset
Period, the applicable Index plus or minus the applicable Spread (if such class
of Reset Rate Notes is in floating rate mode) or the applicable fixed rate,
which may be expressed as the fixed rate pricing benchmark plus or minus a
spread (if such class of Reset Rate Notes is in fixed rate mode), that the
Remarketing Agents, in consultation with the Administrator, determine will be
effective, unless the Call Option is exercised, in the event that 100% of the
holders of that class of Reset Rate Notes choose to hold their Notes for the
upcoming Reset Period.  The All Hold
Rate shall be a rate that the Remarketing Agents, in consultation with the
Administrator, and in their good faith determination, believe would result in
the remarketing of the entire applicable class of Reset Rate Notes at a price
equal to 100% of the Outstanding Amount thereof.

 

“Authenticating
Agents” means Deutsche Bank AG London, in respect of the Reset Rate Notes, or
JPMorgan Chase Bank, in respect of the Excess Distribution Certificate.

 

“Authorized
Officer” means (i) with respect to the Trust, any officer of the Eligible
Lender Trustee who is authorized to act for the Eligible Lender Trustee in
matters relating to the Trust pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Eligible Lender
Trustee to the Indenture Trustee on the Closing Date (as such list may be
modified or supplemented from time to time thereafter), (ii) with respect to
the Administrator, any officer of the Administrator or any of its Affiliates
who is authorized to act for the Administrator in matters relating to itself or
to the Trust and to be acted upon by the Administrator pursuant to the Basic
Documents and who is identified on the list of Authorized Officers delivered by
the Administrator to the Indenture Trustee on the Closing Date (as such list
may be modified or supplemented from time to time thereafter), (iii) with
respect to the Depositor, any officer of the Depositor or any of its Affiliates
who is authorized to act for the Depositor in matters relating to or to be
acted upon by the Depositor pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Depositor to the
Indenture Trustee on the Closing Date (as such list may be modified or
supplemented from time to time thereafter) and (iv) with respect to the
Servicer, any officer of the Servicer who is authorized to act for the Servicer
in matters relating to or to be acted upon by the Servicer

 

A-1-4

 

pursuant to the Basic Documents and who is
identified on the list of Authorized Officers delivered by the Servicer to the
Indenture Trustee on the 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 Servicing
Payment Date, the sum of the following amounts received with respect to the
related Collection Period or, in the case of a Monthly Servicing Payment Date,
the applicable portion of these amounts:

 

(a)           all collections on the Trust Student Loans
received by the Servicer, including any Guarantee Payments received on the
Trust Student Loans (together, with respect to the first Distribution Date, the
Collection Account Initial Deposit), but net of:

 

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

 

(2)           amounts
required by the Higher Education 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 Trust Student Loan, on the Trust Student Loans for that Collection
Period, if any;

 

(b)           any Interest Subsidy Payments and Special
Allowance Payments with respect to the Trust Student Loans during that
Collection Period;

 

(c)           all Liquidation Proceeds from any Trust
Student Loans which became Liquidated Student Loans during that Collection
Period in accordance with the Servicer’s customary servicing procedures, net of
expenses incurred by the Servicer related to their liquidation and any amounts
required by law to be remitted to the borrowers on the Liquidated Student
Loans, and all Recoveries on Liquidated Student Loans which were written off in
prior Collection Periods or during that Collection Period;

 

(d)           the aggregate Purchase Amounts received
during that Collection Period for those Trust Student Loans repurchased by the
Depositor or purchased by the Servicer or for Trust Student Loans sold to
another eligible lender pursuant to Section 3.11E of the Servicing Agreement;

 

(e)           the aggregate Purchase Amounts received
during that Collection Period for those Trust Student Loans repurchased by SLM
ECFC;

 

(f)            the aggregate amounts, if any, received
from any of SLM ECFC, the Depositor or the Servicer, as the case may be, as
reimbursement of non-guaranteed interest amounts, or lost Interest Subsidy
Payments and Special Allowance Payments, on the Trust Student Loans pursuant to
the Sale Agreement or Section 3.5 of the Servicing Agreement, respectively;

 

(g)           amounts received by the Trust pursuant to
Sections 3.1 and 3.12 of the Servicing Agreement during that Collection Period
as to yield or principal adjustments;

 

A-1-5

 

(h)           any interest remitted by the Administrator
to the Collection Account prior to such Distribution Date or Monthly Servicing
Payment Date;

 

(i)            Investment Earnings for that Distribution
Date earned on amounts on deposit in each Trust Account (other than any
Accumulation Account, the Euro Account or any Other Currency Account);

 

(j)            Investment Earnings actually received by
the Trust for that Distribution Date, earned on amounts on deposit in any
Accumulation Account;

 

(k)           amounts transferred from the Remarketing Fee
Account in excess of the sum of the Reset Period Target Amounts for that
Distribution Date;

 

(l)             payments received
under the Interest Rate Cap Agreement;

 

(m)          amounts transferred from the Reserve Account
in excess of the Specified Reserve Account Balance as of that Distribution
Date;

 

(n)           the Investment Premium Purchase Account
Release Amount transferred from any Investment Premium Purchase Account on that
Distribution Date;

 

(o)           all amounts on deposit in any Investment
Reserve Account not transferred to the related Accumulation Account to offset
realized losses on Eligible Investments actually incurred by the Trust as of
that Distribution Date;

 

(p)           all amounts received by the Trust from any
Swap Counterparty for deposit into the Collection Account, but only to the
extent paid in U.S. Dollars during that Collection Period;

 

(q)           all amounts on deposit in any Supplemental
Interest Account;

 

(r)            amounts transferred from the Reserve
Account in excess of the Specified Reserve Account Balance for that
Distribution Date; and

 

(s)           on the July 2006 Distribution Date, all
funds then on deposit in the Capitalized Interest Account that are transferred
into the Collection Account on that Distribution 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, in that order, to pay
certain of the items specified in clauses (a) through (e) of Section 2.8 of the
Administration Agreement (but excluding clause (e), and including clauses (f)
and (g) thereof, in the event that a condition exists as described in either
clause (i) or (ii) of the last paragraph of Section 2.8 of the Administration
Agreement), as set forth in Sections 2.9 and 2.10(a) of the Administration
Agreement, relating to such allocations and distributions, then Available Funds for
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 Administrator, or which the Administrator reasonably estimates to be held
by the

 

A-1-6

 

Administrator,
for deposit into the Collection Account on the related Determination Date 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.

 

“Basic
Documents” means the Trust Agreement, the Indenture, the Servicing Agreement,
the Administration Agreement, the Sale Agreement, the Purchase Agreement, the
Guarantee Agreements, the Note Depository Agreements, any Remarketing
Agreement, any Swap Agreements (including the Interest Rate Cap Agreement and
the Initial Currency Swap Agreements) and other documents and certificates
delivered in connection with any such documents.

 

“Benefit
Plan” means (i) an employee benefit plan (as defined in Section 3(3) of
ERISA), whether or not subject to the provisions of Title I of ERISA, (ii) a
plan described in Section 4975(e)(1) of the Code, whether or not subject to
Section 4975 of the Code or (iii) any entity whose underlying assets include
plan assets by reason of a plan’s investment in the entity.

 

“Bill of
Sale” has the meaning specified in the Purchase Agreement or the Sale
Agreement, as applicable.

 

“Book-Entry
Note” means a beneficial interest in the Notes, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 2.10 of the Indenture.

 

“Business
Day” means (i) with respect to calculating LIBOR of a specified maturity or
GBP-LIBOR of a specified maturity, any day on which banks in New York, New York
and London, England are open for the transaction of international business and
making payments in respect of any class of Reset Rate Notes denominated in a
currency other than U.S. Dollars; (ii) with respect to calculating EURIBOR of a
specified maturity, any day on which TARGET, and banks in New York, New York
and London, England are open for the transaction of international business and
making payments in respect of any class of Reset Rate Notes denominated in a
currency other than U.S. Dollars; and (iii) for all other purposes, any day
other than a Saturday, a Sunday or a day on which banking institutions or trust
companies in New York, New York or Wilmington, Delaware are authorized or
obligated by law, regulation or executive order to remain closed.

 

“Call
Option” means, the option assigned by the Depositor to SLM Corporation which
may be further assigned by SLM Corporation to one of its subsidiaries as a
permitted transferee (provided, that no such subsidiary shall possess the Call
Option if it at any time owned an interest in any of the Trust Student Loans)
to purchase 100% of a class of Reset Rate Notes in its entirety as of its
related Reset Date, exercisable at a price equal 100% of the Outstanding Amount
of such class of Reset Rate Notes, less all amounts distributed to the related
Reset Rate Noteholders as a payment of principal in respect of the related
Distribution Date, plus any accrued and unpaid interest not paid by the Trust
in respect of the related Distribution Date, and pursuant to the terms and
conditions set forth in the Reset Rate Note Procedures.

 

A-1-7

 

“Call
Option Notice” means a written notice from the holder of the Call Option or
the Administrator, as applicable, stating its desire to exercise the Call
Option on the related Reset Date, delivered to each Clearing Agency, the
Indenture Trustee, the Remarketing Agents, the Rating Agencies and, if the
related class of Reset Rate Notes is then listed on the Luxembourg Stock
Exchange, the Administrator will forward a copy to the Luxembourg Listing Agent
(the contents of which are to be published in a leading newspaper having
general circulation in Luxembourg).

 

“Call Rate”
means, if a Call Option has been exercised with respect to a class of Reset
Rate Notes, the rate of interest that is either (1) if that class did not have
at least one related Swap Agreement in effect during the previous Reset Period,
the floating rate applicable for the most recent Reset Period during which the
Failed Remarketing Rate was not in effect; or (2) if that class had one or more
related Swap Agreements in effect during the previous Reset Period, the
weighted average of the floating rates of interest that were due to the related
Interest Rate Swap Counterparties from the Trust during the previous Reset
Period.  The Call Rate will continue to
apply for each Reset Period while the holder of the Call Option retains that
class of Reset Rate Notes.

 

“Capitalized
Interest” means for any Distribution Date through and including the July
2006 Distribution Date:

 

(a)          if neither
of the conditions set forth in Section 2.10(a) of the Administration Agreement
are in effect, the amount on deposit in the Capitalized Interest Account on the
Distribution Date following distributions with respect to clauses (d)(1),
(d)(2) and (e) of Section 2.8 of the Administration Agreement, or

 

(b)         if either
of the conditions set forth in Section 2.10(a) of the Administration Agreement
is in effect, the excess, if any, of (x) the amount on deposit in the
Capitalized Interest Account on the Distribution Date following distributions
with respect to clauses (d)(1) and (d)(2) of Section 2.8 of the Administration
Agreement over (y) the Class B Noteholders’ Interest Distribution Amount.

 

“Capitalized
Interest Account” means the account designated as such, established and
maintained pursuant to Section 2.3(h) of the Administration Agreement.

 

“Capitalized
Interest Account Initial Deposit” means $30,000,000.

 

“Carryover
Servicing Fee” has the meaning specified in Attachment A to the Servicing
Agreement.

 

“Class A
Note” means, a Class A-1 Note, a Class A-2 Note, a Class A-3 Note, a Class
A-4 Note, a Class A-5 Note or a Class A-6 Note.

 

“Class A
Note Interest Shortfall” means, for any Distribution Date, the excess of
(x) the Class A Noteholders’ Interest Distribution Amount on the preceding
Distribution Date, over (y) the amount of interest actually distributed to the
Class A Noteholders or the Currency Swap Counterparty, as applicable, on
the preceding Distribution Date, plus (2) interest on the amount

 

A-1-8

 

of that excess, to the extent permitted by
law, at the interest rate applicable for each such Class of Notes from the
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 or deposited into any Accumulation
Account on such Distribution Date.

 

“Class A
Noteholder” means the Person in whose name a Class A Note is registered in
the Note Register.

 

“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 for that Distribution
Date.

 

“Class A
Noteholders’ Interest Distribution Amount” means, for any Distribution
Date, the sum of: (1) the amount of interest accrued at the Class A-1 Rate, the
Class A-2 Rate, the Class A-3 Rate, the Class A-4 Rate, the Class A-5 Rate or
the Class A-6 Rate, as applicable, for the related Accrual Period on the
Outstanding Amount of all classes of Class A Notes on the immediately preceding
Distribution Date(s) after giving effect to all principal distributions to
Class A Noteholders on that preceding Distribution Date or, in the case of the
first Distribution Date, on the Closing Date, and (2) the Class A Note
Interest Shortfall for that Distribution Date.

 

“Class A
Noteholders’ Principal Distribution Amount” means, for any Distribution
Date, the Principal Distribution Amount times the Class A Percentage for that
Distribution Date, plus any Class A Note Principal Shortfall as of the close of
business on the preceding Distribution Date; provided that the
Class A Noteholders’ Principal Distribution Amount will not exceed the
Outstanding Amount of the Class A Notes (less all amounts, other than
Investment Earnings, on deposit in any related Accumulation Account).  In addition, on the Class A-1 Maturity Date,
the Class A-2 Maturity Date, the Class A-3 Maturity Date, the Class A-4
Maturity Date, the Class A-5 Maturity Date or the Class A-6 Maturity Date, as
applicable, the principal required to be distributed to the related Class A
Noteholders will include the amount required to reduce the Outstanding Amount
of that class to zero.

 

“Class A
Notes” means the Floating Rate Class A Notes and the Reset Rate Notes.

 

“Class A
Percentage” means 100% minus the Class B Percentage.

 

“Class A-1
Maturity Date” means the April 2009 Distribution Date.

 

“Class A-2
Maturity Date” means the July 2013 Distribution Date.

 

“Class A-3
Maturity Date” means the July 2015 Distribution Date.

 

“Class A-4
Maturity Date” means the January 2020 Distribution Date.

 

“Class A-5
Maturity Date” means the April 2024 Distribution Date.

 

A-1-9

 

“Class A-6
Maturity Date” means the January 2040 Distribution Date.

 

“Class A-1
Noteholder” means a Person in whose name a Class A-1 Note is registered in
the Note Register.

 

“Class A-2
Noteholder” means a Person in whose name a Class A-2 Note is registered in
the Note Register.

 

“Class A-3
Noteholder” means a Person in whose name a Class A-3 Note is registered in
the Note Register.

 

“Class A-4
Noteholder” means a Person in whose name a Class A-4 Note is registered in
the Note Register.

 

“Class A-5
Noteholder” means a Person in whose name a Class A-5 Note is registered in
the Note Register.

 

“Class A-6
Noteholder” means a Person in whose name a Class A-6 Note is registered in
the Note Register.

 

“Class A-1
Notes” means the $164,000,000 Floating Rate Class A-1 Student Loan-Backed
Notes issued by the Trust pursuant to the Indenture, substantially in the form of
Exhibit A-1 thereto.

 

“Class A-2
Notes” means the $335,000,000 Floating Rate Class A-2 Student Loan-Backed
Notes issued by the Trust pursuant to the Indenture, substantially in the form
of Exhibit A-2 thereto.

 

“Class A-3
Notes” means the $205,000,000 Floating Rate Class A-3 Student Loan-Backed
Notes issued by the Trust pursuant to the Indenture, substantially in the form
of Exhibit A-3 thereto.

 

“Class A-4
Notes” means the $467,505,000 Floating Rate Class A-4 Student Loan-Backed
Notes issued by the Trust pursuant to the Indenture, substantially in the form
of Exhibit A-4 thereto.

 

“Class A-5
Notes” means the €410,000,000 Reset Rate Class A-5 Student Loan-Backed Notes
issued by the Trust pursuant to the Indenture, substantially in the form of
Exhibits A-5, A-6 and A-7 thereto.

 

“Class A-6
Notes” means the €410,000,000 Reset Rate Class A-6 Student Loan-Backed Notes
issued by the Trust pursuant to the Indenture, substantially in the form of
Exhibits A-8, A-9 and A-10 thereto.

 

“Class A-1
Rate” means, for any Accrual Period after the initial Accrual Period,
Three-Month LIBOR, as determined on the related LIBOR Determination Date, minus
0.01%, based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class A-1 Rate shall mean the
Initial Accrual Rate minus 0.01%, based on an Actual/360 accrual method.

 

A-1-10

 

“Class A-2
Rate” means, for any Accrual Period after the initial Accrual Period,
Three-Month LIBOR, as determined on the related LIBOR Determination Date, plus
0.02%, based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class A-2 Rate shall mean the
Initial Accrual Rate plus 0.02%, based on an Actual/360 accrual method.

 

“Class A-3
Rate” means, for any Accrual Period after the initial Accrual Period,
Three-Month LIBOR, as determined on the related LIBOR Determination Date, plus
0.09%, based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class A-3 Rate shall mean the
Initial Accrual Rate plus 0.09%, based on an Actual/360 accrual method.

 

“Class A-4
Rate” means, for any Accrual Period after the initial Accrual Period,
Three-Month LIBOR, as determined on the related LIBOR Determination Date, plus
0.14%, based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class A-4 Rate shall mean the
Initial Accrual Rate plus 0.14%, based on an Actual/360 accrual method.

 

“Class A-5
Rate” means, for any Accrual Period after the initial Accrual Period until
and including the Initial Reset Date for the Class A-5 Notes, Three-Month
EURIBOR, as determined on the related EURIBOR Determination Date, plus 0.125%,
based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class A-5 Rate shall mean the
Initial Accrual Rate plus 0.125%, based on an Actual/360 accrual method.  The Class A-5 Rate shall be changed on each
related Reset Date to the interest rate and Day Count Basis that will be set
forth in the notice required to be delivered by the Administrator and/or the
Remarketing Agents on each Remarketing Terms Determination Date and Spread
Determination Date, as applicable, pursuant to the procedures set forth in the
Reset Rate Note Procedures.

 

“Class A-6
Rate” means, for any Accrual Period after the initial Accrual Period until
and including the Initial Reset Date for the Class A-6 Notes, Three-Month
EURIBOR, as determined on the related EURIBOR Determination Date, plus 0.125%,
based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class A-6 Rate shall mean the Initial
Accrual Rate plus 0.125%, based on an Actual/360 accrual method.  The Class A-6 Rate shall be changed on each
related Reset Date to the interest rate and Day Count Basis that will be set
forth in the notice required to be delivered by the Administrator and/or the
Remarketing Agents on each Remarketing Terms Determination Date and Spread
Determination Date, as applicable, pursuant to the procedures set forth in the
Reset Rate Note Procedures.

 

“Class B
Maturity Date” means the January 2040 Distribution Date.

 

“Class B
Note Interest Shortfall” means, with respect to any Distribution Date,
(1) the excess of (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 such preceding
Distribution Date, plus (2) interest on the amount of such excess interest due
to the Class B Noteholders, to the extent permitted by law, at the Class B Rate
from such 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
such Distribution Date

 

A-1-11

 

over (ii) the amount of principal actually
distributed to the Class B Noteholders on such Distribution Date.

 

“Class B
Noteholder” means the Person in whose name a Class B Note is registered in
the Note Register.

 

“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 for 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 Rate for the
related Accrual Period on the Outstanding Amount of the Class B Notes on the
immediately preceding Distribution Date (or, in the case of the first
Distribution Date, the Closing 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 for that Distribution Date.

 

“Class B
Noteholders’ Principal Distribution Amount” means, for any Distribution
Date, the Principal Distribution Amount times the Class B Percentage for such
Distribution Date, plus any Class B Note Principal Shortfall as of the close of
business on the preceding Distribution Date; provided that the Class B
Noteholders’ Principal Distribution Amount will not exceed the Outstanding
Amount of the Class B Notes.  In
addition, on the Class B Maturity Date, the principal required to be
distributed to the Class B Noteholders will include the amount required to
reduce the Outstanding Amount of the Class B Notes to zero.

 

“Class B
Notes” means the $67,530,000 Floating Rate Class B Student Loan-Backed
Notes issued by the Trust pursuant to the Indenture, substantially in the form
of Exhibit A-11 thereto.

 

“Class B
Percentage” with respect to any Distribution Date, means (1) prior to the
Stepdown Date or with respect to any Distribution Date on which a Trigger Event
is in effect, zero; and (2) on and after the Stepdown Date and provided that no
Trigger Event is in effect, a fraction expressed as a percentage, the numerator
of which is the aggregate principal balance of the Class B Notes immediately
prior to that Distribution Date and the denominator of which is the Outstanding
Amount of the Notes, less all amounts (other than Investment Earnings) on
deposit in any Accumulation Account, immediately prior to that Distribution
Date.

 

“Class B
Rate” means, for any Accrual Period after the initial Accrual Period,
Three-Month LIBOR, as determined on the related LIBOR Determination Date, plus
0.46%, based on an Actual/360 accrual method. 
For the initial Accrual Period, the Class B Rate shall mean the Initial
Accrual Rate plus 0.46%, based on an Actual/360 accrual method.

 

“Clearing
Agency” means DTC, Euroclear or Clearstream, as applicable, or another
organization registered as a “clearing agency” pursuant to applicable law.  The initial Clearing Agency for the Floating
Rate Notes shall be DTC and the initial nominee for such Clearing Agency shall
be Cede & Co.  The initial Clearing
Agencies for a class of Reset Rate Notes (i) for any related Reset Period when
it is denominated in a currency other than U.S. Dollars shall be Euroclear and
Clearstream and the initial joint nominee for such Clearing Agencies shall be

 

A-1-12

 

Deutsche Bank AG London, and (ii) for any
related Reset Period when it is denominated in U.S. Dollars shall be DTC and
the initial nominee for such Clearing Agency shall be Cede & Co., or
Euroclear and Clearstream and the initial joint nominee for such Clearing
Agencies shall be Deutsche Bank AG London, as applicable.

 

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

 

“Clearstream”
means Clearstream Banking, société anonyme, Luxembourg.

 

“Closing
Date” means August 25, 2004.

 

“CMT Rate”
means, for any relevant Interest Rate Determination Date prior to each Interest
Rate Change Date, the rate displayed on the applicable Designated CMT Moneyline
Telerate Page shown below by 3:00 p.m., New York City time, on that Interest
Rate Determination Date under the caption “. 
..  .  Treasury Constant Maturities . 
..  .  Federal Reserve Board Release H.15 .  .  .  Mondays Approximately 3:45 p.m.,” under the
column for: (i) if the Designated CMT Moneyline Telerate Page is 7051, the rate
on that Interest Rate Determination Date; or (ii) if the Designated CMT
Moneyline Telerate Page is 7052, the average for the week, the month or the
quarter, as specified on the Remarketing Terms Determination Date, ended
immediately before the week in which the Interest Rate Determination Date
occurs.  The following procedures will
apply if the CMT Rate cannot be determined as described above: (i) if the rate
described above is not displayed on the relevant page by 3:00 p.m., New York
City time on that Interest Rate Determination Date, unless the calculation is
made earlier and the rate is available from that source at that time on that
Interest Rate Determination Date, then the CMT Rate will be the Treasury
constant maturity rate having the designated index maturity, as published in
H.15(519) or another recognized electronic source for displaying the rate, (ii)
if the applicable rate described above is not published in H.15(519) or another
recognized electronic source for displaying such rate by 3:00 p.m., New York
City time on that Interest Rate Determination Date, unless the calculation is
made earlier and the rate is available from one of those sources at that time,
then the CMT Rate will be the Treasury constant maturity rate, or other United
States Treasury rate, for the index maturity and with reference to the relevant
Interest Rate Determination Date, that is published by either the Board of
Governors of the Federal Reserve System or the United States Department of the
Treasury and that the Administrator determines to be comparable to the rate
formerly displayed on the Designated CMT Moneyline Telerate Page shown above
and published in H.15(519), (iii) if the rate described in the prior paragraph
cannot be determined, then the Administrator will determine the CMT Rate to be
a yield to maturity based on the average of the secondary market closing
offered rates as of approximately 3:30 p.m., New York City time, on the
relevant Interest Rate Determination Date reported, according to their written
records, by leading primary United States government securities dealers in New
York City.  The Administrator will
select five such securities dealers and will eliminate the highest and lowest
quotations or, in the event of equality, one of the highest and lowest
quotations, for the most recently issued direct noncallable fixed rate
obligations of the United States Treasury (“Treasury Notes”) with an original
maturity of approximately the designated index maturity and a remaining term to
maturity of not less than the designated index maturity minus one year in a
representative amount, (iv) if the

 

A-1-13

 

Administrator cannot obtain three Treasury
Note quotations of the kind described above in (iii), the Administrator will
determine the CMT Rate to be the yield to maturity based on the average of the
secondary market bid rates for Treasury Notes with an original maturity longer
than the designated CMT index maturity which have a remaining term to maturity
closest to the designated CMT index maturity and in a representative amount, as
of approximately 3:30 p.m., New York City time, on the relevant Interest Rate
Determination Date of leading primary United States government securities
dealers in New York City.  In selecting
these offered rates, the Administrator will request quotations from at least
five such securities dealers and will disregard the highest quotation (or if
there is equality, one of the highest) and the lowest quotation (or if there is
equality, one of the lowest).  If two
Treasury Notes with an original maturity longer than the designated CMT index
maturity have remaining terms to maturity that are equally close to the
designated CMT index maturity, the Administrator will obtain quotations for the
Treasury Note with the shorter remaining term to maturity, (v) if three or four
but not five leading primary United States government securities dealers are
quoting as described in the prior paragraph, then the CMT Rate for the relevant
Interest Rate Determination Date will be based on the average of the bid rates
obtained and neither the highest nor the lowest of those quotations will be
eliminated, or (vi) if fewer than three leading primary United States
government securities dealers selected by the Administrator are quoting as
described in (v) above, the CMT Rate will remain the CMT Rate then in effect on
that Interest Rate Determination Date.

 

“Code”
means the Internal Revenue Code of 1986, as amended from time to time, and
Treasury Regulations promulgated thereunder.

 

“Collateral”
has the meaning specified in the Granting Clause of the Indenture.

 

“Collection
Account” means the account designated as such, established and maintained
pursuant to Section 2.3(f) of the Administration Agreement.

 

“Collection
Account Initial Deposit” means $950,000.

 

“Collection
Period” means, with respect to the first Distribution Date, the period
beginning on the Closing Date and ending on September 30, 2004, and with
respect to each subsequent Distribution Date, the Collection Period means the
three calendar months immediately following the end of the previous Collection
Period.

 

“Commercial
Paper Rate” means, for any relevant Interest Rate Determination Date prior
to each Interest Rate Change Date, the Bond Equivalent Yield shown below of the
rate for 90-day commercial paper, as published in H.15(519) prior to 3:00 p.m.,
New York City time, on that Interest Rate Determination Date under the heading
“Commercial Paper—Financial”.  If the
rate described above is not published in H.15(519) by 3:00 p.m., New York City
time, on that Interest Rate Determination Date, unless the calculation is made
earlier and the rate was available from that source at that time, then the
Commercial Paper Rate will be the Bond Equivalent Yield of the rate on the
relevant Interest Rate Determination Date, for commercial paper having the
index maturity specified on the Remarketing Terms Determination Date, as
published in H.15 Daily Update or any other recognized electronic source used
for displaying that rate under the heading “Commercial Paper—Financial”.  For purposes of the definition of
“Commercial Paper Rate”, the “Bond Equivalent Yield” equals (NxD)]/[360(Dx90)
times 100, where “D” refers to the per

 

A-1-14

 

annum rate determined as set forth above,
quoted on a bank discount basis and expressed as a decimal and “N” refers to
365 or 366, as the case may be.  If the
rate described above cannot be determined, the Commercial Paper Rate will
remain the commercial paper rate then in effect on that Interest Rate Determination
Date.  Unless otherwise specified on the
Remarketing Terms Determination Date, the Commercial Paper Rate will be subject
to a Lock-In Period of six Business Days.

 

“Commission”
means the Securities and Exchange Commission.

 

“Consolidation
Loans” means Student Loans made in accordance with the Section 428C of the
Higher Education Act.

 

“Corporate
Trust Office” means (i) with respect to the Indenture Trustee, the
principal office of the Indenture Trustee at which at any particular time its
corporate trust business shall be administered, which office at the Closing
Date is located at 60 Wall Street, 26th Floor, Mailstop NYC60-2606,
New York, New York 10005, Attention: Trust & Securities Services/Structured
Finance Services, telephone: (212) 250-8454, facsimile: (212) 797-8606 or
at such other address as the Indenture Trustee may designate from time to time
by notice to the Noteholders and the Depositor, or the principal corporate
trust office of any successor Indenture Trustee (the address of which the successor
Indenture Trustee will notify the Noteholders, the Administrator and the
Depositor) and (ii) with respect to the Eligible Lender Trustee, the principal
corporate trust office of the Eligible Lender Trustee located at Christiana
Center/OPS4, 500 Stanton Christiana Road, Newark, Delaware 19713,
Attention:  Corporate Trust Department
(telephone: (302) 552-6279; facsimile: (302) 552-6280); or at such other
address as the Eligible Lender Trustee may designate by notice to the
Depositor, or the principal corporate trust office of any successor Eligible
Lender Trustee (the address of which the successor Eligible Lender Trustee will
notify the Administrator and the Depositor).

 

“Currency
Swap Agreement” means with respect to any class of Reset Rate Notes in Foreign
Exchange Mode, each Swap Agreement between the Trust and the related Currency
Swap Counterparty which (i) converts the secondary market trade proceeds into
U.S. Dollars received on the effective date of such Swap Agreement (or, with
respect to the Initial Currency Swap Agreements, converts all proceeds on the
Closing Date from the sale of each class of Reset Rate Notes to U.S. Dollars);
(ii) converts all principal payments in U.S. Dollars by the Trust to the
related class of Reset Rate Noteholders into the applicable currency; (iii)
converts the interest rate on any class of Reset Rate Notes from a LIBOR-based
rate to a fixed or floating rate payable in the applicable currency; (iv)
converts the U.S. Dollar equivalent of all secondary market trade proceeds
received on the related Reset Date resulting in the successful remarketing of a
class of Reset Rate Notes or the exercise of a Call Option into the applicable
currency for the payment of principal to the tendering Reset Rate Noteholders;
and (v) pays to the Paying Agent, on behalf of the Trust, for the benefit
of the tendering Reset Rate Noteholders, the required amount of additional
interest at the interest rate applicable to the tendered Reset Rate Notes
resulting from any required delay in Reset Date payments through Euroclear and
Clearstream.

 

“Currency
Swap Counterparty” means each Eligible Swap Counterparty that is a party,
in its capacity as swap counterparty, to the related Currency Swap Agreement.

 

A-1-15

 

“Custodian”
has the meaning specified in Section 2.1 of the Indenture.

 

“Cutoff
Date” means August 25, 2004.

 

“Day Count
Basis” means 30/360, Actual/360, Actual/365 (Fixed), Actual/Actual (accrual
basis), Actual/Actual (ISMA) or Actual/Actual (payment basis), as applicable,
or any other day count basis set forth in the Remarketing Terms Notice.

 

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

 

“Definitive
Notes” has the meaning specified in Section 2.10 of the Indenture.

 

“Delaware
Statutory Trust Act” means Chapter 38 of Title 12, Part V of the Delaware
Code, entitled “Treatment of Delaware Statutory Trusts”.

 

“Delivery”
when used with respect to Trust Account Property means:

 

(a)           with respect to bankers’ acceptances,
commercial paper, negotiable certificates of deposit and other obligations that
constitute “instruments” within the meaning of Section 9-102(a)(47) of the UCC
and are susceptible of physical delivery, transfer thereof to the Indenture
Trustee or its nominee or custodian by physical delivery to the Indenture
Trustee or its nominee or custodian endorsed to, or registered in the name of,
the Indenture Trustee or its nominee or custodian or endorsed in blank, and, with
respect to a certificated security (as defined in Section 8-102(a)(3) of the
UCC) transfer thereof (i) by delivery of such certificated security endorsed
to, or registered in the name of, the Indenture Trustee or its nominee or
custodian or endorsed in blank to a securities intermediary (as defined in
Section 8-102(a)(14) of the UCC) and the making by such securities intermediary
of entries on its books and records identifying such certificated securities as
belonging to the Indenture Trustee or its nominee or custodian and the sending
by such securities intermediary of a confirmation of the purchase of such
certificated security by the Indenture Trustee or its nominee or custodian, or
(ii) by delivery thereof to a “clearing corporation” (as defined in Section
8-102(a)(5) of the UCC) and the making by such clearing corporation of
appropriate entries on its books reducing the appropriate securities account of
the transferor and increasing the appropriate securities account of a
securities intermediary by the amount of such certificated security, the
identification by the clearing corporation of the certificated securities for
the sole and exclusive account of the securities intermediary, the maintenance
of such certificated securities by such clearing corporation or the nominee of
either subject to the clearing corporation’s exclusive control, the sending of
a confirmation by the securities intermediary of the purchase by the Indenture
Trustee or its nominee or custodian of such securities and the making by such
securities intermediary of entries on its books and records identifying such
certificated securities as belonging to the Indenture Trustee or its nominee or
custodian (all of the foregoing, but not including Trust Student Loans,
“Physical Property”); and such additional or alternative procedures as may
hereafter become appropriate to effect the complete transfer of ownership of
any such Trust Account Property to the Indenture Trustee or its nominee or
custodian, consistent with changes in applicable law or regulations or the
interpretation thereof;

 

A-1-16

 

(b)           with respect to any security issued by the
U.S. Treasury, the Government National Mortgage Association, the Federal Home
Loan Mortgage Corporation or the Federal National Mortgage Association that is
a book-entry security held at a Federal Reserve Bank pursuant to Federal
book-entry regulations, the following procedures, all in accordance with
applicable law, including applicable Federal regulations and Articles 8 and 9
of the UCC: the crediting of such book-entry security to an appropriate
book-entry account of the Indenture Trustee or its nominee or the custodian or
securities intermediary at a Federal Reserve Bank, causing the custodian to
continuously indicate by book-entry such book-entry security as credited to the
relevant book-entry account, the continuous crediting of such book-entry
security to a securities account of the custodian at such Federal Reserve Bank
and the continuous identification of such book-entry security by the custodian
as credited to the appropriate book-entry account; and

 

(c)           with respect to any item of Trust Account
Property that is an uncertificated security under Article 8 of the UCC and that
is not governed by clause (b) above, registration on the books and records of
the issuer thereof in the name of the securities intermediary, the sending of a
confirmation by the securities intermediary of the purchase by the Indenture
Trustee or its nominee or custodian of such uncertificated security, the making
by such securities intermediary of entries on its books and records identifying
such uncertificated certificates as belonging to the Indenture Trustee or its
nominee or custodian.

 

“Department”
means the United States Department of Education, an agency of the Federal
government.

 

“Depositor”
means SLM Funding LLC, a Delaware limited liability company, and its successors
and assigns, including for such purpose, a permitted transferee of all of SLM
Funding LLC’s right, title and interest in the Excess Distribution Certificate.

 

“Depository
Agreements” means the Note Depository Agreements.

 

“Determination
Date” means, with respect to the Collection Period preceding any
Distribution Date, the first Business Day preceding such Distribution Date.

 

“Distribution
Date” means for any class of Notes, the 25th day of each of January, April,
July and October, or, if such day is not a Business Day, the immediately
following Business Day, commencing October 25, 2004.

 

“DTC”
means The Depository Trust Company, or any successor thereto.

 

“Eligible
Deposit Account” means (i) with respect to the Trust Accounts other
than the Euro Account or any Other Currency Account, either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with the
corporate trust department of a depository institution organized under the laws
of the United States of America or any one of the States or the District of
Columbia (or any domestic branch of a foreign bank), having corporate trust powers
and acting as trustee for funds deposited in such account, so long as any of
the securities of such depository institution have a credit rating from
Moody’s, S&P, and, if such institution is rated by Fitch, Fitch, in one of
their generic rating categories which signifies investment grade

 

A-1-17

 

and (ii) with respect to the Euro
Account or any Other Currency Account, a segregated account with the London
Paying Agent.

 

“Eligible
Institution” means a depository institution organized under the laws of the
United States of America or any one of the States or the District of Columbia
(or any domestic branch of a foreign bank) (i) which has (A) either a long-term
senior unsecured debt rating of “AAA” or a short-term senior unsecured debt or
certificate of deposit rating of “A-1+” or better by S&P and (B)(1) a
long-term senior unsecured debt rating of “A1” or better and (2) a short-term
senior unsecured debt rating of “P-1” or better by Moody’s, and (C) if such
institution is rated by Fitch, a long-term senior unsecured debt rating of “AA”
or a short-term senior unsecured debt rating of “F1+”, or any other long-term,
short-term or certificate of deposit rating with respect to which the Rating
Agency Condition has been satisfied and (ii) whose deposits are insured by the
FDIC.  If so qualified, the Eligible
Lender Trustee or the Indenture Trustee may be considered an Eligible
Institution.

 

“Eligible
Investments” means book-entry securities, negotiable instruments or
securities represented by instruments in bearer or registered form which
evidence:

 

(a)           direct obligations of, and obligations fully
guaranteed as to timely payment by, the United States of America, the
Government National Mortgage Association, the Federal Home Loan Mortgage
Corporation, the Federal National Mortgage Association, SLMA, or any agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America; provided
that obligations of, or guaranteed by, the Government National Mortgage
Association (GNMA), the Federal Home Loan Mortgage Corporation (Freddie Mac),
the Federal National Mortgage Association (Fannie Mae) or SLMA shall be
Eligible Investments only if, at the time of investment, they meet the criteria
of each of the Rating Agencies for collateral for securities having ratings
equivalent to the respective ratings of the Notes in effect at the Closing
Date;

 

(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 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 credit rating
from each of the Rating Agencies in the highest investment category granted
thereby;

 

(c)           commercial paper having, at the time of the
investment, a rating from each of the Rating Agencies in the highest investment
category granted thereby;

 

(d)           investments in money market funds having a
rating from each of the Rating Agencies in the highest investment category
granted thereby (including funds for which

 

A-1-18

 

the Indenture
Trustee, the Administrator or the Eligible Lender Trustee or any of their
respective Affiliates is investment manager or advisor);

 

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

 

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

 

(g)           asset-backed securities, including
asset-backed securities issued by Affiliates, or entities formed by Affiliates,
of SLMA, but excluding mortgage-backed securities, that at the time of investment
have a rating in the highest investment category granted by each of the Rating
Agencies, but not at a purchase price in excess of par;

 

(h)           Eligible Repurchase Obligations; and

 

(i)            any other investment which would not result
in the downgrading or withdrawal of any rating of the Notes by any of the
Rating Agencies as affirmed in writing delivered to the Indenture Trustee.

 

For purposes
of the definition of “Eligible Investments” the phrase “highest investment
category” means (i) in the case of Fitch, “AAA” for long-term investments (or
the equivalent) and “F-1+” for short-term investments (or the equivalent), (ii)
in the case of Moody’s, “Aaa” for long-term investments (or the equivalent) and
“P-1” for short-term investments (or the equivalent), and (iii) in the case of
S&P, “AAA” for long-term investments (or the equivalent) and “A-1+” for
short-term investments (or the equivalent). 
A proposed investment not rated by Fitch but rated in the highest
investment category by Moody’s and S&P shall be considered to be rated by
each of the Rating Agencies in the highest investment category granted thereby.

 

“Eligible
Lender Trustee” means Chase Manhattan Bank USA, National Association, a
national banking association, not in its individual capacity but solely as Eligible
Lender Trustee under the Trust Agreement. 
“Eligible Lender Trustee” shall also mean each successor Eligible Lender
Trustee as of the qualification of such successor as Eligible Lender Trustee
under the Trust Agreement.

 

“Eligible
Loans” has the meaning specified in the Purchase Agreement or the Sale
Agreement, as applicable.

 

“Eligible
Repo Counterparty” means an institution that is an eligible lender (under
the Federal Family Education Loan Program) or that holds Student Loans through
an eligible lender trustee and whose short-term debt ratings are not less than
“P-1” by Moody’s,  “A-1” by S&P and
“F1” by Fitch, if rated by Fitch.

 

“Eligible
Repurchase Obligations” means repurchase obligations with respect to
Student Loans serviced by the Servicer or an Affiliate thereof, entered into
with an Eligible Repo

 

A-1-19

 

Counterparty, provided that the applicable
repurchase date shall occur no later than the Business Day prior to the next
Distribution Date.

 

“Eligible
Swap Counterparty” means an entity, which may be an affiliate of a
Remarketing Agent, engaged in the business of entering into derivative
instrument contracts that satisfies the Rating Agency Condition.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended.

 

“EURIBOR”
means Two-Month EURIBOR or Three-Month EURIBOR, as applicable.

 

“EURIBOR
Determination Date” means, for each Accrual Period, the day that is two
EURIBOR Settlement Days before the beginning of that Accrual Period.

 

“EURIBOR
Settlement Day” means any day on which TARGET is open which is also a day
on which banks in New York, New York and London, England are open for business.

 

“Euro Account”
means the account designated as such, established and maintained pursuant to
Section 2.3(n) of the Administration Agreement.

 

“Euroclear”
means the Euroclear System, or any successor thereto.

 

“European
Clearing Systems” means Euroclear or Clearstream.

 

“Event of
Default” has the meaning specified in Section 5.1 of the Indenture.

 

“Excess
Distribution Certificate” means the certificate, substantially in the form
of Exhibit A to the Trust Agreement, evidencing the right to receive payments
thereon as set forth in Sections 2.8(p), 2.9(f) and 2.10(a)(ii) of the
Administration Agreement.

 

“Excess
Distribution Certificate Paying Agent” means any paying agent or co-paying
agent appointed pursuant to Section 3.3(g) of the Trust Agreement, which paying
agent shall initially be the Indenture Trustee.

 

“Excess
Distribution Certificate Register” and “Excess Distribution Certificate
Registrar” mean the register mentioned and the registrar appointed pursuant
to Section 3.3(c) of the Trust Agreement.

 

“Excess
Distribution Certificateholder” means the person in whose name an Excess
Distribution Certificate is registered in the Excess Distribution Certificate
Register.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

“Executive
Officer” means, with respect to any corporation, the Chief Executive
Officer, Chief Operating Officer, Chief Financial Officer, President, any
Executive Vice President, any Senior Vice President, any Vice President, the
Secretary or the Treasurer of such corporation; and with respect to any
partnership, any general partner thereof.

 

A-1-20

 

“Expenses”
means any and all liabilities, obligations, losses, damages, taxes, claims,
actions and suits, and any and all reasonable costs, expenses and disbursements
(including reasonable legal fees and expenses) of any kind and nature
whatsoever which may at any time be imposed on, incurred by, or asserted
against the Eligible Lender Trustee or any of its officers, directors or agents
in any way relating to or arising out of the Trust Agreement, the other Basic Documents,
the Trust Estate, the administration of the Trust Estate or the action or
inaction of the Eligible Lender Trustee under the Trust Agreement or the other
Basic Documents.

 

“Extension
Rate” means, for each Distribution Date following a Failed Remarketing if a
class of Reset Rate Notes is then in Foreign Exchange Mode, the rate of
interest payable to each related Currency Swap Counterparty, not to exceed
Three-Month LIBOR plus 0.75%, unless the Remarketing Agents, in consultation
with the Administrator, determine that market conditions or some other benefit
to the Trust requires a higher rate; provided that in such case the
Rating Agency Condition is satisfied. 
The initial Extension Rate for each class of Reset Rate Notes under the
Initial Currency Swap Agreements is Three-Month LIBOR plus 0.75%.

 

“Failed
Remarketing” means, on any Reset Date for a class of Reset Rate Notes, the
situation where:

 

(a)           the Remarketing Agents, in consultation with
the Administrator, cannot establish one or more of the terms required to be set
on the Remarketing Terms Determination Date;

 

(b)           the Remarketing Agents are unable to
establish the Spread or fixed rate on the Spread Determination Date;

 

(c)           either the Remarketing Agents are unable to
remarket some or all of the tendered Reset Rate Notes at the Spread or fixed
rate established on the Spread Determination Date, or any committed purchasers
default on their purchase obligations and in their sole discretion, the
Remarketing Agents elect not to purchase those Reset Rate Notes themselves;

 

(d)           both classes of Reset Rate Notes are to be
remarketed on the same Reset Date and the terms of such remarketing include a
change in priority with respect to the right to receive principal payments, and
the Remarketing Agents are unable to remarket a class of Reset Rate Notes;

 

(e)           the Remarketing Agents, in consultation with
the Administrator, are unable to obtain one or more Swap Agreements meeting the
required criteria, if applicable;

 

(f)            any of the conditions specified in Section
8 of the Remarketing Agreement are not satisfied; or

 

(g)           any applicable Rating Agency Condition has
not been satisfied.

 

“Failed
Remarketing Rate” means, for any Reset Period and any class of Reset Rate
Notes then denominated in U.S. Dollars, Three-Month LIBOR plus 0.75%; and for
any Reset Period and any class of Reset Rate Notes while in Foreign Exchange
Mode, as will be determined on the related Spread Determination Date pursuant
to the terms of the related

 

A-1-21

 

Currency Swap Agreement (and for the initial
Reset Period, the Failed Remarketing Rate for the Class A-5 Notes and Class A-6
Notes will be Three-Month EURIBOR plus 0.40%.

 

“FDIC”
means the Federal Deposit Insurance Corporation.

 

“Federal
Funds Rate” means the rate set forth for such day opposite the caption
“Federal Funds (effective)” in the weekly statistical release designated
H.15(519), or any successor publication, published by the Board of Governors of
the Federal Reserve System.  If such rate
is not published in the relevant H.15(519) for any day, the rate for such day
shall be the arithmetic mean of the rates for the last transaction in overnight
Federal Funds arranged prior to 9:00 a.m. New York City time on that day by
each of four leading brokers in such transactions located in New York City
selected by the Administrator.  The
Federal Funds rate for each Saturday and Sunday and for any other that is not a
Business Day shall be the Federal Funds Rate for the preceding Business Day as
determined above.

 

“Fitch”
means Fitch Inc., also known as Fitch Ratings, or any successor rating agency.

 

“Floating
Rate Class A Notes” means the Class A-1 Notes, the Class A-2 Notes, the
Class A-3 Notes and the Class A-4 Notes.

 

“Floating
Rate Noteholder” means the Person in whose name a Floating Rate Note is
registered in the Note Register.

 

“Floating
Rate Notes” means the Floating Rate Class A Notes and the Class B Notes.

 

“Foreign
Exchange Mode” means that a class of Reset Rate Notes is then denominated
in a currency other than U.S. Dollars during the related Reset Period.

 

“GBP-LIBOR”
means, with respect to any Accrual Period, the London interbank offered rate for
deposits in Pounds Sterling having a maturity of three months, 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 GBP-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 Pounds Sterling, having the specified maturity
and in a principal amount of not less than £1,000,000, are offered at
approximately 11:00 a.m., London time, on that GBP-LIBOR Determination Date, to
prime banks in the London interbank market by the Reference Banks.  The Administrator will request the principal
London office of each Reference Bank to provide a quotation of its rate.  If the Reference Banks provide at least two
quotations, the rate for that day will be the arithmetic mean of the
quotations.  If the Reference Banks
provide fewer than two quotations, the rate for that day will be the arithmetic
mean of the rates quoted by prime banks in London, selected by the
Administrator, at approximately 11:00 a.m. London time, on that GBP-LIBOR
Determination Date, for loans in Pounds Sterling to leading European banks
having the specified maturity and in a principal amount of not less than
£1,000,000.  If the banks selected as
described above are not providing quotations, GPB-LIBOR in effect for the
applicable Accrual Period will be GBP-LIBOR for the specified maturity in
effect for the previous Accrual Period. 
For any GBP-LIBOR-based notes, interest due for any Accrual Period
always will be determined based on the actual number of days elapsed in the
Accrual Period over a 365-day year.

 

A-1-22

 

“GBP-LIBOR
Determination Date” means, for each Accrual Period, the day that is two
GBP-LIBOR Settlement Days before the beginning of that Accrual Period.

 

“GBP-LIBOR
Settlement Day” means any day on which banks in both London and New York
City are open for business.

 

“Global
Note Certificate” means a global note certificate representing interests in
the Reset Rate Notes offered and sold in reliance on Rule 144A or
Regulation S, as applicable.

 

“Grant”
means mortgage, pledge, bargain, sell, warrant, alienate, remise, release,
convey, assign, transfer, create and grant a lien upon and a security interest
in and right of set-off against, deposit, set over and confirm pursuant to the
Indenture.  A Grant of the Collateral or
of any other agreement or instrument shall include all rights, powers and
options (but none of the obligations) of the Granting party thereunder,
including the immediate and continuing right to claim for, collect, receive and
give receipt for principal and interest payments in respect of the Collateral
and all other moneys payable thereunder, to give and receive notices and other
communications, to make waivers or other agreements, to exercise all rights and
options, to bring Proceedings in the name of the Granting party or otherwise
and generally to do and receive anything that the Granting party is or may be
entitled to do or receive thereunder or with respect thereto.

 

“Guarantee
Agreement” means any agreement between any Guarantor and the Eligible
Lender Trustee providing for the payment by the Guarantor of amounts authorized
to be paid pursuant to the Higher Education Act to holders of qualifying
Student Loans guaranteed in accordance with the Higher Education Act by such
Guarantor.

 

“Guarantee
Payment” means any payment made by a Guarantor pursuant to a Guarantee
Agreement in respect of a Trust Student Loan.

 

“Guarantor”
means any entity listed on Attachment B (as amended from time to time) to
the Sale Agreement or the Purchase Agreement as applicable.

 

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

 

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

 

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

 

“Hold
Notice” means a written statement (or an oral statement confirmed in
writing, which may be by e-mail) from a holder or beneficial owner of Reset
Rate Notes denominated in U.S. Dollars during the then-current and immediately
following Reset Periods, delivered to a Remarketing Agent that such holder or
beneficial owner desires to hold its Reset Rate Notes for the upcoming Reset
Period and affirmatively agrees to receive a rate of interest of not less than
the applicable All Hold Rate during that Reset Period.

 

A-1-23

 

“Indenture”
means the Indenture, dated as of August 1, 2004, among the Eligible Lender
Trustee on behalf of the Trust, the Trust and the Indenture Trustee.

 

“Indenture
Trust Estate” means all money, instruments, rights and other property that
are subject or intended to be subject to the lien and security interest of the
Indenture for the benefit of the Noteholders and, as applicable, each Swap
Counterparty (including all Collateral Granted to the Indenture Trustee),
including all proceeds thereof.

 

“Indenture
Trustee” means Deutsche Bank Trust Company Americas, a New York banking
corporation, not in its individual capacity but solely as trustee under the
Indenture.

 

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

 

“Independent
Certificate” means a certificate or opinion to be delivered to the
Indenture Trustee under the circumstances described in, and otherwise complying
with, the applicable requirements of Section 11.1 of the Indenture, made by an
Independent appraiser or other expert appointed by an Issuer Order and approved
by the Indenture Trustee in the exercise of reasonable care, and such opinion
or certificate shall state that the signer has read the definition of
“Independent” in the Indenture and that the signer is Independent within the
meaning thereof.

 

“Index”
or “Indices” means LIBOR, EURIBOR, GBP-LIBOR, a Commercial Paper Rate,
the CMT Rate, the Federal Funds Rate, the 91-day Treasury Bill Rate, the Prime
Rate or any other interest rate index specified in Schedule A to the Reset Rate
Notes.

 

“Index
Maturity” means, with respect to any Accrual Period, the interval between
Interest Rate Change Dates for each applicable Index during such Accrual
Period, commencing on the first day of that Accrual Period.

 

“Initial Accrual Rate” means for each class of Notes and the
Accrual Period commencing on the Closing Date to, but excluding, the first
Distribution Date, Two-Month LIBOR or Two Month EURIBOR, as applicable.

 

“Initial
Currency Swap Agreements” means two initial Currency Swap Agreements, each
dated as of August 17, 2004, relating to the Reset Rate Notes and each between
the Trust and the Initial Currency Swap Counterparty.

 

“Initial
Currency Swap Counterparty” means CDC IXIS Capital Markets, London Branch,
and any successors or permitted assigns.

 

“Initial
Euro Exchange Rate” means an exchange rate of $1.2341 equal to €1.00

 

A-1-24

 

“Initial
Pool Balance” means the Pool Balance as of the Cutoff Date, which is
$2,209,947,408.

 

“Initial
Purchasers” means, collectively, Merrill Lynch International, Morgan
Stanley & Co. Incorporated, Banc of America Securities Limited and Wachovia
Securities International Limited.

 

“Initial
Remarketing Agency Agreement” means each agreement, substantially in the
form of Appendix B to the Remarketing Agreement to be entered into on each
Remarketing Terms Determination Date (unless a Call Option has been exercised)
among the Remarketing Agents, the Administrator and the Trust.

 

“Initial
Reset Dates” means, for the Class A-5 Notes and Class A-6 Notes, the
Distribution Dates in July 2011 and October 2011, respectively.

 

“Initial
Reset Date Notice” means the written notice delivered pursuant to Section
3(a) of the Reset Rate Note Procedures.

 

“Insolvency
Event” means, with respect to a specified Person, (a) the filing of a
decree or order for relief by a court having jurisdiction in the premises in
respect of such Person or any substantial part of its property in an
involuntary case under any applicable Federal or state bankruptcy, insolvency
or other similar law now or hereafter in effect, or appointing a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar official for
such Person or for any substantial part of its property, or ordering the
winding-up or liquidation of such Person’s affairs, which decree or order
remains unstayed and in effect for a period of 60 consecutive days; or (b) the
commencement by such Person of a voluntary case under any applicable Federal or
state bankruptcy, insolvency or other similar law now or hereafter in effect,
or the consent by such Person to the entry of an order for relief in an
involuntary case under any such law, or the consent by such Person to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official for such Person or for any
substantial part of its property, or the making by such Person of any general
assignment for the benefit of creditors, or the failure by such Person
generally to pay its debts as such debts become due, or the taking of action by
such Person in furtherance of any of the foregoing.

 

“Interest
Rate Cap Agreement” means the agreement between the Trust and the Interest
Rate Cap Swap Counterparty, dated August 17, 2004, documented under a 1992 ISDA
Master Agreement (Multicurrency-Cross Border), including the related schedule
and the Interest Rate Cap Confirmation, providing for certain payments to the
Trust, in the amounts and under the conditions set forth therein, which will
terminate in accordance with its terms on or before the January 2006 Distribution
Date.

 

“Interest
Rate Cap Confirmation” means the confirmation executed under the Interest
Rate Cap Agreement, dated as of August 17, 2004, representing the interest rate
cap in a notional amount of $720,000,000.

 

“Interest
Rate Cap Swap Counterparty” means CDC IXIS Capital Markets, London Branch
and any successors or permitted assigns.

 

A-1-25

 

“Interest
Rate Change Date” means for each Accrual Period, the date or dates, based
on the applicable Index, on which the rate of interest for a class of Reset
Rate Notes bearing interest at a floating rate is to be reset.

 

“Interest
Rate Determination Date” means, for each Accrual Period, and (i) for the
Reset Rate Notes that bear interest at a LIBOR, EURIBOR or GBP-LIBOR-based
rate, the related LIBOR, EURIBOR or GBP-LIBOR Determination Date, as
applicable, or (ii) for the Reset Rate Notes that bear interest at a
floating rate that is not LIBOR, EURIBOR or GBP-LIBOR-based, the applicable
date or dates set forth in the Remarketing Terms Notice, on which the
applicable rate of interest to be in effect as of the next Interest Rate Change
Date will be determined by the Administrator.

 

“Interest
Rate Swap Agreement” means, with respect to any class of Reset Rate Notes
during any Reset Period when it is denominated in U.S. Dollars and (i) bears a
fixed rate of interest (or bears interest based on LIBOR or a U.S. Commercial
Paper Rate, if a Swap Agreement is to be entered into pursuant to the Reset
Rate Note Procedures), or (ii) bears interest based on an index other than
LIBOR or a U.S. Commercial Paper Rate, any Swap Agreement between the Trust and
an Eligible Swap Counterparty, to hedge the basis risk during the related Reset
Period.

 

“Interest
Subsidy Payments” means payments, designated as such, consisting of
interest subsidies by the Department in respect of the Trust Student Loans to
the Eligible Lender Trustee on behalf of the Trust in accordance with the
Higher Education Act.

 

“Interim
Eligible Lender Trustee” means Chase Manhattan Bank USA, National
Association, a national banking association, not in its individual capacity but
solely as Interim Eligible Lender Trustee under the Interim Trust
Agreement.  “Interim Eligible Lender
Trustee” shall also mean each successor Interim Eligible Lender Trustee as of
the qualification of such Interim Eligible Lender Trustee under the Interim
Trust Agreement.

 

“Interim
Trust Agreement” means the Interim Trust Agreement, dated as of August 1,
2004, between the Depositor and the Interim Eligible Lender Trustee.

 

“Interim
Trust Loans” has the meaning set forth in the Interim Trust Agreement.

 

“Investment
Earnings” means, with respect to any Distribution Date, the investment
earnings (net of losses and investment expenses) on amounts on deposit in the
Trust Accounts to be deposited into the Collection Account on or prior to such
Distribution Date pursuant to Section 2.3(b) of the Administration Agreement.

 

“Investment
Premium Purchase Account” means each account designated as such, established
and maintained pursuant to Section 2.3(l) of the Administration Agreement.

 

“Investment
Premium Purchase Account Deposit Amount” means, with respect to each
Distribution Date when funds are deposited into an Accumulation Account, an
amount equal to 1.00% of the amount deposited into that Accumulation Account on
such Distribution Date.

 

A-1-26

 

“Investment
Premium Purchase Account Release Amount” means, with respect to any
Distribution Date that is one year or less prior to a Reset Date relating to a
class of Reset Rate Notes for which funds are then on deposit in an
Accumulation Account, the amount, if any, to be withdrawn from the related
Investment Premium Purchase Account so that the remaining funds on deposit in
such Investment Premium Purchase Account will be equal to the lesser of
(a) 1.00% of the amount on deposit in the related Accumulation Account,
and (b) the amount then on deposit the related Investment Premium Purchase
Account; provided that on any Distribution Date that is also a Reset
Date for a class of Reset Rate Notes for which amounts are then on deposit in
an Accumulation Account, all Investment Premium Purchase Account Deposit
Amounts relating to such Accumulation Account that remain on deposit in the
related Investment Premium Purchase Account will become part of the related
Investment Premium Purchase Account Release Amount on such Distribution Date.

 

“Investment
Reserve Account” means each account designated as such, established and
maintained pursuant to Section 2.3(m) of the Administration Agreement.

 

“Investment
Reserve Account Required Amount” means, with respect to each Distribution
Date, immediately following the date when the ratings of any Eligible
Investment in an Accumulation Account has been downgraded by one or more Rating
Agencies, an amount (to the extent of Available Funds), to be set by each
applicable Rating Agency in satisfaction of the Rating Agency Condition (but not to exceed the amount of the
unrealized loss on the related Eligible Investment).

 

“Issuer”
means the Trust and, for purposes of any provision contained in the Indenture
and required by the TIA, each other obligor on the Notes.

 

“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”
means Two-Month LIBOR or Three-Month LIBOR, as applicable.

 

“LIBOR
Determination Date” means, for each Accrual Period, the second Business Day
before the beginning of that Accrual Period.

 

“Lien”
means a security interest, lien, charge, pledge, equity or encumbrance of any
kind, other than tax liens and any other liens, if any, which attach to the
respective Trust Student Loan by operation of law as a result of any act or
omission by the related Obligor.

 

“Liquidated
Student Loan” means any defaulted Trust Student Loan liquidated by the
Servicer (which shall not include any Trust Student Loan on which Guarantee
Payments are received) or which the Servicer has, after using all reasonable
efforts to realize upon such Trust Student Loan, determined to charge off.

 

“Liquidation
Proceeds” means, with respect to any Liquidated Student Loan which became a
Liquidated Student Loan during the current Collection Period in accordance with
the Servicer’s customary servicing procedures, the moneys collected in respect
of the liquidation thereof from whatever source, other than Recoveries, net of
the sum of any amounts expended by

 

A-1-27

 

the Servicer in connection with such
liquidation and any amounts required by law to be remitted to the Obligor on
such Liquidated Student Loan.

 

“Loan”
has the meaning set forth in Section 2 of the Purchase Agreement.

 

“Lock-In
Period” means a period from the first day of such Lock-In Period (which may
be expressed as a number of Business Days prior to a Distribution Date) to the
immediately succeeding Interest Payment Date during which the interest rate,
Index or other calculation in effect on the first day of such Lock-In Period
shall remain in effect for every day in such Lock-In Period.

 

“London
Paying Agent” means, with respect to any class of Reset Rate Notes while in
Foreign Exchange Mode, the Indenture Trustee or any other Person that meets the
eligibility standards for the Indenture Trustee specified in Section 6.11
of the Indenture and is authorized by the Eligible Lender Trustee on behalf of
the Trust to make the payments to and distributions from the Euro Account and
any Other Currency Account, which authorized Person shall initially be Deutsche
Bank AG London.

 

“Luxembourg
Listing Agent” means, initially, Deutsche Bank Luxembourg SA.

 

“Luxembourg
Paying Agent” means, initially, Deutsche Bank Luxembourg SA.

 

“Minimum
Purchase Amount” means an amount that would be sufficient to (i) reduce the
Outstanding Amount of each class of Notes, less the amount on deposit in any
Accumulation Account with respect to the related class of Reset Rate Notes, on
such Distribution Date to zero and (ii) pay to the respective Noteholders the
Class A Noteholders’ Interest Distribution Amount and the Class B
Noteholders’ Interest Distribution Amount payable on such Distribution Date.

 

“Monthly
Servicing Payment Date” means the 25th day of each calendar
month or, if such day is not a Business Day, the immediately following Business
Day, commencing on September 27, 2004.

 

“Moody’s”
means Moody’s Investors Service, Inc., or any successor rating agency.

 

“Non-U.S.
Global Note Certificates” has the meaning specified in Section 2.1 of the
Indenture.

 

“Non-U.S.
Rule 144 A Global Note Certificate” has the meaning specified in Section
2.1 of the Indenture.

 

“Note”
and “Notes” means any of the Floating Rate Notes and the Reset Rate
Notes.

 

“Note
Depository Agreements” means with respect to the Notes, the Letter of
Representations, dated August 25, 2004, among the Trust, the Eligible Lender
Trustee and the Indenture Trustee in favor of DTC, and with respect to the
Reset Rate Notes, the Instruction Letter from Issuer to Common Depositary,
dated August 25, 2004 between the Trust and Deutsche Bank AG London.

 

A-1-28

 

“Note Final
Maturity Date” for a class of Notes means the Class A-1 Maturity Date,
the Class A-2 Maturity Date, the Class A-3 Maturity Date, the Class A-4
Maturity Date, the Class A-5 Maturity Date, the Class A-6 Maturity Date or the
Class B Maturity Date, as applicable.

 

“Note
Interest Shortfall” means the Class A Note Interest Shortfall, if any,
and/or the Class B Note Interest Shortfall, if any, as applicable.

 

“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 applicable 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).

 

“Note Pool
Factor” means, as of the close of business on a Distribution Date, a
seven-digit decimal figure equal to the Outstanding Amount of a class of Notes
divided by the original Outstanding Amount of such class of Notes.  The Note Pool Factor for each class will be
1.0000000 as of the Closing Date; thereafter, the Note Pool Factor for each
class will decline to reflect reductions in the Outstanding Amount of that
class of Notes.

 

“Note
Purchase Agreement” means the Note Purchase Agreement dated as of August
17, 2004, among the Depositor, the Seller, SLM Corporation and the Initial
Purchasers.

 

“Note Rates”
means, with respect to any Accrual Period, the Class A-1 Rate, the Class A-2
Rate, the Class A-3 Rate, the Class A-4 Rate, the Class A-5 Rate, the Class A-6
Rate and the Class B Rate for such Accrual Period, collectively.

 

“Note
Register” and “Note Registrar” have the respective meanings
specified in Section 2.4 of the Indenture.

 

“Noteholder”
means a Floating Rate Noteholder, a Class A Noteholder, a Reset Rate Noteholder
or a Class B Noteholder, as the context requires.

 

“Notes”
means the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes, the Class
A-4 Notes, the Class A-5 Notes, the Class A-6 Notes and the Class B Notes,
collectively.

 

“Notice
Date” means, for each class of Reset Rate Notes, 12:00 p.m. (noon), New
York City time, on the sixth day prior to the Reset Date for that class.

 

“Obligor”
on a Trust Student Loan means the borrower or co-borrowers of such Trust
Student Loan and any other Person who owes payments in respect of such Trust
Student Loan, including the Guarantor thereof and, with respect to any Interest
Subsidy Payment or Special Allowance Payment, if any, thereon, the Department.

 

“Officers’
Certificate” means (i) in the case of the Trust, a certificate signed by
any two Authorized Officers of the Eligible Lender Trustee, under the
circumstances described in, and otherwise complying with, the applicable
requirements of Section 11.1 of the Indenture, and delivered to the Indenture
Trustee, and (ii) in the case of the Depositor, the Administrator or the

 

A-1-29

 

Servicer, a certificate signed by any two
Authorized Officers of the Depositor, the Administrator or the Servicer, as
applicable.

 

“Opinion of
Counsel” means (i) with respect to the Trust, one or more written opinions
of counsel who may, except as otherwise expressly provided in the Indenture, be
employees of or counsel to the Eligible Lender Trustee, the Trust, the
Depositor or an Affiliate of the Depositor and who shall be satisfactory to the
Indenture Trustee, and which opinion or opinions shall be addressed to the
Indenture Trustee as Indenture Trustee, shall comply with any applicable
requirements of Section 11.1 of the Indenture and shall be in form and
substance satisfactory to the Indenture Trustee, and (ii) with respect to the
Depositor, the Administrator or the Servicer, one or more written opinions of
counsel who may be an employee of or counsel to the Depositor, the
Administrator or the Servicer, which counsel shall be acceptable to the
Indenture Trustee and the Eligible Lender Trustee.

 

“Origination
Fee” means any origination fee payable to the Department by the lender with
respect to any Trust Student Loan.

 

“Other
Currency Account” means each account designated as such, established and
maintained pursuant to Section 2.3(n) of the Administration Agreement.

 

“Outstanding”
means, as of any date of determination, all Notes theretofore authenticated and
delivered under the Indenture except:

 

(a)           Notes theretofore cancelled by the Note
Registrar or delivered to the Note Registrar for cancellation;

 

(b)           Notes, or portions thereof, for which
payment has been made to the applicable Noteholders in reduction of the
outstanding principal balance thereof or for which money in the necessary
amount has been theretofore deposited with the Indenture Trustee or any Paying
Agent in trust for the Noteholders thereof (excluding for such purpose any
amounts on deposit in any Accumulation Account); provided, however,
that if such Notes are to be redeemed, notice of such redemption has been duly
given pursuant to the Indenture; and

 

(c)           Notes in exchange for or in lieu of other
Notes which have been authenticated and delivered pursuant to the Indenture
unless proof satisfactory to the Indenture Trustee is presented that any such
Notes are held by a bona fide purchaser; provided that in determining
whether the Noteholders of the requisite Outstanding Amount of the Notes have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder or under any other Basic Document, Notes owned by the Trust, any
other obligor upon the Notes, the Depositor or any Affiliate of any of the
foregoing Persons shall be disregarded and deemed not to be Outstanding, except
that, in determining whether the Indenture Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Notes that a Responsible Officer of the Indenture
Trustee either actually knows to be so owned or has received written notice
thereof shall be so disregarded.  Notes
so owned that have been pledged in good faith may be regarded as Outstanding if
the pledgee establishes to the satisfaction of the Indenture Trustee the
pledgee’s right so to act with respect to such Notes and

 

A-1-30

 

that the
pledgee is not the Trust, any other obligor upon the Notes, the Depositor or
any Affiliate of any of the foregoing Persons.

 

“Outstanding
Amount” means, as of any date of determination, the aggregate principal
balance of all the Notes or the applicable class or classes of Notes, as the
case may be, Outstanding at such date of determination; provided, however,
that if any class of Reset Rate Notes is then in Foreign Exchange Mode, the Outstanding
Amount shall be based on the U.S. Dollar Equivalent Principal Amount of that
class of Reset Rate Notes.

 

“Paying
Agent” means, with respect to the Notes (other than any class of Reset Rate
Notes denominated in a currency other than U.S. Dollars), the Indenture Trustee
or any other Person that meets the eligibility standards for the Indenture
Trustee specified in Section 6.11 of the Indenture and is authorized by the
Eligible Lender Trustee, on behalf of the Trust, to make the payments to and distributions
from the Collection Account and payments of principal of and interest and any
other amounts owing on the Notes on behalf of the Trust.  With respect to any class of Reset Rate
Notes denominated in a currency other than U.S. Dollars, Paying Agent means the
London Paying Agent and the Luxembourg Paying Agent.

 

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

 

“Physical
Property” has the meaning assigned to such terms in the definition of
“Delivery” above.

 

“Pool
Balance” for any date means the aggregate principal balance of the Trust
Student Loans on that date, including accrued interest that is expected to be
capitalized, as reduced by:

 

(a)           all payments received by the Trust through
that date from borrowers, the Guarantors and the Department;

 

(b)           all amounts received by the Trust through
that date from repurchases of the Trust Student Loans by SLM ECFC or the
Depositor, as applicable, or purchases by the Servicer;

 

(c)           all Liquidation Proceeds and Realized Losses
on the Trust Student Loans liquidated through that date;

 

(d)           the amount of any adjustments to outstanding
principal balances of the Trust Student Loans that the Servicer makes under the
Servicing Agreement through that date; and

 

(e)           the amount by which Guarantor reimbursements
of principal on defaulted Trust Student Loans through that date are reduced
from 100% to 98%, or other applicable percentage, as required by the risk
sharing provisions of the Higher Education Act.

 

A-1-31

 

“Predecessor
Note” means, with respect to any particular Note, every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for the purpose of this definition, any Note
authenticated and delivered under Section 2.5 of the Indenture and in lieu of a
mutilated, lost, destroyed or stolen Note shall be deemed to evidence the same
debt as the mutilated, lost, destroyed or stolen Note.

 

“Primary
Servicing Fee” for any Monthly Servicing Payment Date has the meaning
specified in Attachment A to the Servicing Agreement, and shall include any
such fees from prior Monthly Servicing Payment Dates that remain unpaid.

 

“Prime Rate”
means, for any relevant Interest Rate Determination Date prior to each Interest
Rate Change Date, the prime rate or base lending rate on that date, as
published in H.15(519), prior to 3:00 p.m., New York City time, on that
Interest Rate Determination Date under the heading “Bank Prime Loan.”  The Administrator will observe the following
procedures if the Prime Rate cannot be determined as described above: (i) if
the rate described above is not published in H.15(519) prior to 3:00 p.m., New
York City time, on the relevant Interest Rate Determination Date unless the
calculation is made earlier and the rate was available from that source at that
time, then the Prime Rate will be the rate for that Interest Rate Determination
Date, as published in H.15 Daily Update or another recognized electronic source
for displaying such rate opposite the caption “Bank Prime Loan”, (ii) if the
above rate is not published in either H.15(519), H.15 Daily Update or another
recognized electronic source for displaying such rate by 3:00 p.m., New York
City time, on the relevant Interest Rate Determination Date, then the Administrator
will determine the Prime Rate to be the average of the rates of interest
publicly announced by each bank that appears on the Reuters screen designated
as “USPRIME1” as that bank’s prime rate or base lending rate as in effect on
that Interest Rate Determination Date, (iii) if fewer than four rates
appear on the Reuters screen USPRIME1 page on the relevant Interest Rate
Determination Date, then the Prime Rate will be the average of the prime rates
or base lending rates quoted, on the basis of the actual number of days in the
year divided by a 360-day year, as of the close of business on that Interest
Rate Determination Date by three major banks in New York City selected by the
Administrator, or (iv) if the banks selected by the Administrator are not quoting
as mentioned above, the Prime Rate will remain the prime rate then in effect on
that Interest Rate Determination Date.

 

“Principal
Distribution Amount” means, (i) with respect to the initial
Distribution Date, the amount by which the sum of the Outstanding Amount of the
Notes exceeds the Adjusted Pool Balance for that Distribution Date, and
(ii) with respect to each subsequent Distribution Date, the sum of
(a) the amount by which the Adjusted Pool Balance for the preceding
Distribution Date exceeds the Adjusted Pool Balance for that Distribution Date,
and (b) any amounts received under the Interest Rate Cap Agreement for
that Distribution Date.

 

“Proceeding”
means any suit in equity, action at law or other judicial or administrative
proceeding.

 

“Purchase Agreement”
means the Purchase Agreement Master Securitization Terms Number 1000, dated as
of August 25, 2004, among SLM ECFC, the Interim Eligible Lender Trustee and the
Depositor, and the purchase agreement or agreements entered into thereunder.

 

A-1-32

 

“Purchase
Amount” with respect to any Trust Student Loan means the amount required to
prepay in full such Trust Student Loan under the terms thereof including all
accrued interest thereon.

 

“Purchased
Student Loan” means a Trust Student Loan which is, as of the close of
business on the last day of a Collection Period, purchased by the Servicer
pursuant to Section 3.5 of the Servicing Agreement or repurchased by the
Depositor pursuant to Section 6 of the Sale Agreement, repurchased by SLM ECFC
pursuant to Section 6 of the Purchase Agreement or sold to another eligible
lender holding one or more Serial Loans with respect to such Trust Student Loan
pursuant to Section 3.11E of the Servicing Agreement.

 

“QIB”
means a “qualified institutional buyer” as defined in Rule 144A under the Act.

 

“Quarterly
Funding Amount” means, for each class of Reset Rate Notes, for any
Distribution Date that is (1) more than one year before the next related
Reset Date, zero and (2) one year or less before the next related Reset
Date, an amount to be deposited into the Remarketing Fee Account for the Reset
Rate Notes so that the amount therein in respect of that class equals the
Quarterly Required Amount for that class; provided, however, that
if on any Distribution Date that is not a Reset Date, the amount on deposit in
the Remarketing Fee Account in respect of that class is greater than the
Quarterly Required Amount for that class, such excess will be transferred to
the Collection Account and included in Available Funds for that Distribution
Date.

 

“Quarterly
Required Amount” means, for each class of Reset Rate Notes, (1) on any
related Reset Date, the Reset Period Target Amount for that class or
(2) on a Distribution Date that is one year or less before the next
related Reset Date (x) the Reset Period Target Amount for that class
multiplied by (y) 5 minus the number of Distribution Dates remaining until
the next Reset Date for that class (excluding the current Distribution Date and
including the next Reset Date), divided by (z) five (5).

 

“Rating
Agency” means Moody’s, S&P and Fitch. 
If any such organization or successor thereto is no longer in existence,
“Rating Agency” with respect to such organization shall be a nationally
recognized statistical rating organization or other comparable Person
designated by the Administrator, notice of which designation shall be given to
the Indenture Trustee, the Eligible Lender Trustee and the Servicer.

 

“Rating
Agency Condition” means, with respect to any intended action, that each
Rating Agency then rating a class of Notes shall have been given 10 days’ prior
written notice thereof and that each such Rating Agency shall have notified the
Administrator, the Servicer, the Eligible Lender Trustee, the Indenture Trustee
and the Remarketing Agents, if applicable, in writing that such proposed action
will not result in and of itself in the reduction or withdrawal of its
then-current rating of any class of 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 Student
Loan over Liquidation Proceeds for that Liquidated Student Loan to the extent
allocable to principal, including any interest that had been or had been
expected to be capitalized.

 

A-1-33

 

“Record
Date” means, with respect to a Distribution Date or Redemption Date and for
each class of Notes, the close of business on the day preceding such Distribution
Date or Redemption Date.

 

“Recoveries”
means moneys collected from whatever source with respect to any Liquidated
Student Loan which was written off in prior Collection Periods or during the
current Collection Period, net of the sum of any amounts expended by the
Servicer for the account of any Obligor and any amounts required by law to be
remitted to any Obligor.

 

“Redemption
Date” means in the case of a payment to Noteholders pursuant to
Section 10.1 of the Indenture, the Distribution Date specified pursuant to
Section 10.1 of the Indenture.

 

“Redemption
Price” means an amount equal to the Outstanding Amount of the Notes, plus
accrued and unpaid interest thereon at the applicable Note Rates to but
excluding the Redemption Date.

 

“Reference
Banks” means, with respect to (i) LIBOR, four major banks in the
London interbank market for deposits in U.S Dollars selected by the
Administrator, (ii) EURIBOR, four major banks in the Euro-zone interbank
market for deposits in Euros selected by the Administrator and (iii) GBP-LIBOR,
four major banks in the London interbank market for deposits in Pounds Sterling
selected by the Administrator.

 

“Registrar”
means the Excess Distribution Certificate Registrar and/or the Note Registrar,
as applicable.

 

“Regulation
S” means Regulation S promulgated under the Act.

 

“Regulation
S Global Note Certificate” has the meaning specified in Section 2.1 of the
Indenture.

 

“Remarketing
Agency Agreement” means the collective reference to an Initial Remarketing
Agency Agreement and the Supplemental Remarketing Agency Agreement.

 

“Remarketing
Agent” means, initially, each of Morgan Stanley & Co. Incorporated and
Merrill Lynch, Pierce, Fenner & Smith Incorporated.  The Administrator, in its sole discretion,
may change any Remarketing Agent for the Reset Rate Notes for any Reset Period
at any time on or before a Remarketing Terms Determination Date.

 

“Remarketing
Agreement” means the Remarketing Agreement dated as of August 25, 2004
among the Remarketing Agents, the Administrator and the Trust, as amended or
supplemented from time to time.

 

“Remarketing
Fee Account” means the account designated as such, established and
maintained pursuant to Section 2.3(i) of the Administration Agreement.

 

A-1-34

 

“Remarketing
Terms Determination Date” means, for a class of Reset Rate Notes, not later
than 3:00 p.m., New York City time, on the eighth Business Day prior to the
applicable Reset Date.

 

“Remarketing
Terms Notice” means the notice delivered by the Remarketing Agents to a
class of Reset Rate Noteholders, the Indenture Trustee, the Rating Agencies and
the applicable Clearing Agencies on each Remarketing Terms Determination Date
containing the information set forth in the Reset Rate Note Procedures (Appendix
A-2 to the Indenture).

 

“Reserve
Account” means the account designated as such, established and maintained
pursuant to Section 2.3(g) of the Administration Agreement.

 

“Reserve
Account Initial Deposit” means $5,524,869.

 

“Reset Date”
means a Distribution Date on which certain terms for a class of Reset Rate
Notes may be changed in accordance with the Reset Rate Note Procedures
(Appendix A-2 to the Indenture).

 

“Reset
Period” means, with respect to any class of Reset Rate Notes, a period of
at least three months (or any other longer duration that is a multiple of three
months) that will always end on the day before a Distribution Date, which such
Distribution Date will be the next Reset Date; provided that no such
Reset Period may end after the day before the related Reset Rate Notes Maturity
Date.

 

“Reset
Period Target Amount” means, for each class of Reset Rate Notes and any
Distribution Date that is (1) more than one year before the next related
Reset Date, zero, and (2) one year or less before the next related Reset
Date, the highest remarketing fee payable to the Remarketing Agents for that
class of Reset Rate Notes (not to exceed 0.35% of the maximum principal balance
of such class of Reset Rate Notes that could be remarketed) on the next related
Reset Date as determined by the Administrator based on the assumed weighted
average life of such class of Reset Rate Notes and the maximum remarketing fee
set forth on a schedule attached to the Remarketing Agreement, as such schedule
may be amended from time to time.

 

“Reset Rate
Note” means any Class A-5 Notes or Class A-6 Notes, as applicable.

 

“Reset Rate
Note Procedures” means Appendix A-2 to the Indenture.

 

“Reset Rate
Noteholder” means the Person in whose name a Reset Rate Note is registered
in the Note Register.

 

“Reset Rate
Notes” means the Class A-5 Notes and Class A-6 Notes.

 

“Reset Rate
Notes Maturity Date” means the Class A-5 Maturity Date or Class A-6
Maturity Date, as applicable.

 

“Responsible
Officer” means, with respect to the Indenture Trustee, any officer within
the Corporate Trust Office of the Indenture Trustee, including any Vice
President, Assistant Vice President, Assistant Treasurer, Assistant Secretary,
or any other officer of the Indenture Trustee

 

A-1-35

 

customarily performing functions similar to
those performed by any of the above designated officers, with direct
responsibility for the administration of the Indenture and the other Basic
Documents on behalf of the Indenture Trustee 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.

 

“S&P”
means Standard & Poor’s Ratings Services, a division of The McGraw-Hill
Companies, Inc.

 

“Sale
Agreement” means the Sale Agreement Master Securitization Terms Number
1000, dated as of August 25, 2004, among the Eligible Lender Trustee on behalf
of the Trust, the Trust, the Interim Eligible Lender Trustee and the Depositor,
and the sale agreement or agreements entered into thereunder.

 

“Schedule
of Trust Student Loans” means the listing of the Trust Student Loans set
forth in Schedule A to the Indenture and the Bill of Sale (which Schedule may
be in the form of microfiche).

 

“Schedule
Replacement Order” means an Issuer Order replacing Schedule A to each class
of Reset Rate Notes to be delivered with respect to the related Reset Date.

 

“Servicer”
means Sallie Mae, Inc., in its capacity as servicer of the Trust Student Loans.

 

“Seller”  means SLM ECFC.

 

“Servicer
Default” means an event specified in Section 5.1 of the Servicing
Agreement.

 

“Servicer
Distribution Date” has the meaning specified in the Servicing Agreement.

 

“Servicer’s
Report” means any report of the Servicer delivered pursuant to Section
3.1(a) of the Administration Agreement, substantially in the form acceptable to
the Administrator.

 

“Servicing
Agreement” means the Servicing Agreement, dated as of August 25, 2004,
among the Trust, the Eligible Lender Trustee, the Servicer, the Administrator
and the Indenture Trustee.

 

“Servicing
Fee” has the meaning specified in Attachment A to the Servicing Agreement.

 

“SLM ECFC”
means SLM Education Credit Finance Corporation.

 

“SLMA”
means the Student Loan Marketing Association.

 

“Special
Allowance Payments” means payments, designated as such, consisting of
effective interest subsidies by the Department in respect of the Trust Student
Loans to the Eligible Lender Trustee on behalf of the Trust in accordance with
the Higher Education Act.

 

“Specified
Reserve Account Balance” means, for any Distribution Date, the greater of:

 

A-1-36

 

(a)           0.25% of the Pool Balance as of the close of
business on the last day of the related Collection Period; and

 

(b)           $3,314,921;

 

provided
that in no event will that balance exceed the Outstanding Amount.  For these purposes, as to a class of Reset
Rate Notes which then bears interest at a fixed rate and is not then structured
to receive a payment of principal until the end of the related Reset Period,
the Outstanding Amount,  or its U.S.
Dollar Equivalent Principal Amount, as applicable, of that class of Reset Rate
Notes will be reduced by any amounts (less any Investment Earnings) on deposit
in the related Accumulation Account for that class of Reset Rate Notes.

 

“Spread”
means the percentage, determined by the Remarketing Agents on the Spread
Determination Date, with respect to a class of Reset Rate Notes that is to bear
a floating rate of interest, in excess of or below the applicable interest rate
Index that will be applicable to that class of Reset Rate Notes during any
Reset Period after the initial Reset Period so as to result in an interest rate
that, in the reasonable opinion of the Remarketing Agents, will enable all of
the tendered Reset Rate Notes of that class to be remarketed by the Remarketing
Agents at 100% of the Outstanding Amount thereof.

 

“Spread
Determination Date” means, for any class of Reset Rate Notes, not later
than 3:00 p.m., New York City time, on the third Business Day prior to the
applicable Reset Date.

 

“Spread
Determination Notice” means the notice delivered by the Remarketing Agents
to the Noteholders of a class of Reset Rate Notes, the Indenture Trustee, the
Rating Agencies, the Clearing Agencies and, if such class of Reset Rate Notes
is then listed on the Luxembourg Stock Exchange, the Luxembourg Stock Exchange
on each Spread Determination Date containing the information set forth in the
Reset Rate Note Procedures (Appendix A-2 to the Indenture).

 

“State”
means any one of the 50 States of the United States of America or the District
of Columbia.

 

“Statistical
Cutoff Date” means August 2, 2004.

 

“Stepdown
Date” means the earlier to occur of (i) the July 2010 Distribution
Date or (ii) the first date on which no Class A Notes remain
Outstanding.  For this purpose, the
Outstanding Principal Balance of a class of Reset Rate Notes will be deemed
reduced by any amounts (other than Investment Earnings) on deposit in any
related Accumulation Account.

 

“Student
Loans” means education loans to students and parents of students under the
Federal Family Education Loan Program.

 

“Successor
Administrator” has the meaning specified in Section 3.7(e) of the
Indenture.

 

“Successor
Servicer” has the meaning specified in Section 3.7(e) of the Indenture.

 

“Supplemental
Interest Account” means each account designated as such, established and
maintained pursuant to Section 2.3(k) of the Administration Agreement.

 

A-1-37

 

“Supplemental
Interest Account Deposit Amount” means, with respect to any Distribution
Date when a class of Reset Rate Notes is then structured not to receive a
payment of principal until the end of the related Reset Period, the lesser of:

 

(a)               the product of:

 

(1)           the difference between (x) the weighted
average of the LIBOR-based rates (as determined on the LIBOR Determination Date
immediately preceding that Distribution Date) that will be payable by the Trust
to any related Swap Counterparties on the next Distribution Date, or the
LIBOR-based rate (as determined on the LIBOR Determination Date immediately
preceding that Distribution Date) that will be payable by the Trust to the
related Noteholders on the next Distribution Date, as applicable, and (y) an
assumed rate of Investment Earnings that satisfies the Rating Agency Condition,

 

(2)           the amount on deposit in the related
Accumulation Account immediately after that Distribution Date, and

 

(3)           the actual number of days from that
Distribution Date to the next Reset Date for that class of Reset Rate Notes,
divided by 360; and

 

(b)              an amount that
satisfies the Rating Agency Condition.

 

“Supplemental
Remarketing Agency Agreement” means each agreement, substantially in the
form of Appendix C to the Remarketing Agreement to be entered into on each
Spread Determination Date (unless a Call Option has been exercised or a Failed
Remarketing has been declared) among the Remarketing Agents, the Administrator
and the Trust.

 

“Swap
Agreement” means the applicable ISDA Master Agreement, and each related
swap schedule and/or Swap Confirmation with respect to: (i) each Initial
Currency Swap Agreement, (ii) each Currency Swap Agreement and each Interest
Rate Swap Agreement to be entered into from time to time by the Administrator
or the Eligible Lender Trustee in either case solely on behalf of the Trust and
an Eligible Swap Counterparty, pursuant to the terms and conditions set forth
in the Reset Rate Note Procedures, and (iii) the Interest Rate Cap Agreement.

 

“Swap
Confirmation” means each swap confirmation relating to a Swap Agreement.

 

“Swap
Counterparty” means each Eligible Swap Counterparty from time to time party
to a Swap Agreement, the Initial Currency Swap Counterparty (with respect to
each Initial Currency Swap Agreement) and the Interest Rate Cap Swap
Counterparty (with respect to the Interest Rate Cap Agreement).

 

“Swap
Interest Payments” means, with respect to each Distribution Date, the
amount payable to the related Swap Counterparty by the Trust as a quarterly
premium payment pursuant to the related Swap Agreement.

 

“Swap
Payments” means, with respect to each Distribution Date, the amount, if
any, payable to a Swap Counterparty by the Trust for such date, including
amounts due and unpaid

 

A-1-38

 

from prior Distribution Dates (other than
Swap Termination Payments), as specified in the applicable Swap Agreement.

 

“Swap
Receipts” means, with respect to each Distribution Date, the amount
required to be received from the related Swap Counterparty by the Trust for
such date (other than Swap Termination Payments), as specified in the related
Swap Agreement.

 

“Swap
Termination Date” means the date on which Swap Agreement terminates in
accordance with its terms, which with respect to any Initial Currency Rate Swap
Agreement is scheduled to be the Initial Reset Date for the related class of
Reset Rate Notes.

 

“Swap
Termination Payments” shall have the meaning set forth in each Swap
Agreement.

 

“TARGET”
means the Trans-European Automated Real-time Gross Settlement Express Transfer
System.

 

“Telerate
Page 248” means the display page so designated on the Moneyline Telerate
Service (or such other page as may replace that page on that service for the
purpose of displaying comparable rates or prices).

 

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

 

“Telerate
Page 7051” means the display page so designated on the Moneyline Telerate
Service (or such other page as may replace that page on that service for the
purpose of displaying comparable rates or prices).

 

“Telerate
Page 7052” means the display page so designated on the Moneyline Telerate
Service (or such other page as may replace that page on that service for the
purpose of displaying comparable rates or prices).

 

“Three-Month
EURIBOR” and “Two-Month EURIBOR” means, with respect to any Accrual Period, the Euro-zone
interbank offered rate for deposits in Euros having the specified maturity
commencing on the first day of the Accrual Period, which appears on Telerate
Page 248 as of 11:00 a.m. Brussels time, on the related EURIBOR Determination
Date.  If an applicable rate does not
appear on Telerate Page 248, the rate for that day will be determined on the
basis of the rates at which deposits in Euros having the specified maturity and
in a principal amount of not less than €1,000,000, are offered at approximately
11:00 a.m., Brussels time, on that EURIBOR Determination Date, to prime banks
in the Euro-zone interbank market by the Reference Banks.  The Administrator will request the principal
Euro-zone 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 the Euro-zone, selected by the
Administrator, at approximately 11:00 a.m. Brussels time, on that EURIBOR
Determination Date, for loans in Euros to leading European banks having the
specified maturity and in a principal amount of not less than €1,000,000.  If the banks selected as described above are
not providing quotations, EURIBOR in

 

A-1-39

 

effect for the applicable
Accrual Period will be EURIBOR for the specified maturity in effect for the
previous Accrual Period.

 

“Three-Month
LIBOR” and “Two-Month LIBOR” means, with respect to any Accrual Period, the
London interbank offered rate for deposits in U.S. Dollars having the Index
Maturity which appears on Telerate Page 3750 as of 11:00 a.m. London time, on
the related LIBOR Determination Date. 
If this rate does not appear on Telerate Page 3750, the rate for that
day will be determined on the basis of the rates at which deposits in U.S.
Dollars, having the Index Maturity and in a principal amount of not less than
U.S. $1,000,000, are offered at approximately 11:00 a.m., London time, on that
LIBOR Determination Date, to prime banks in the London interbank market by the
Reference Banks.  The Administrator will
request the principal London office of each Reference Bank to provide a
quotation of its rate.  If the Reference
Banks provide at least two quotations, the rate for that day will be the
arithmetic mean of the quotations.  If
the Reference Banks provide fewer than two quotations, the rate for that day
will be the arithmetic mean of the rates quoted by major banks in New York
City, selected by the Administrator, at approximately 11:00 a.m., New York
time, on that LIBOR Determination Date, for loans in U.S. Dollars to leading
European banks having the Index Maturity and in a principal amount of not less
than U.S. $1,000,000.  If the banks
selected as described above are not providing quotations, LIBOR in effect for
the applicable Accrual Period will be LIBOR, for the specified maturity in effect
for the previous Accrual Period.

 

“Transfer”
an offer, sale, pledge, transfer or other disposition of a Note or any interest
therein.

 

“Transfer
Date” has the meaning specified in Section  5.2(a) of the Administration
Agreement.

 

“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.

 

“Trigger
Event” means, on any Distribution Date while any of the Class A Notes
are outstanding, the Outstanding Amount of the Notes, less any amounts (other
than Investment Earnings) on deposit in any Accumulation Account, after giving
effect to distributions to be made on that Distribution Date, would exceed the
Adjusted Pool Balance as of the end of the related Collection Period.

 

“Trust”
means SLM Student Loan Trust 2004-8, a Delaware statutory trust established
pursuant to the Trust Agreement.

 

“Trust
Account Property” means the Trust Accounts, all cash and investments held
from time to time in any Trust Account (whether in the form of deposit
accounts, Physical Property, book-entry securities, uncertificated securities
or otherwise), including the Reserve Account Initial Deposit, the Capitalized
Interest Account Initial Deposit, the Collection Account Initial Deposit and
all earnings on and proceeds of the foregoing.

 

A-1-40

 

“Trust
Accounts” has the meaning specified in Section 2.3(b) of the Administration
Agreement.

 

“Trust
Agreement” means the short-form trust agreement, dated as of August 11,
2004, between the Depositor and the Eligible Lender Trustee, as amended and
restated pursuant to an Amended and Restated Trust Agreement, dated as of
August 25, 2004 among the Depositor, the Eligible Lender Trustee and the
Indenture Trustee.

 

“Trust
Auction Date” has the meaning specified in Section 4.4 of the Indenture.

 

“Trust
Estate” means all right, title and interest of the Trust (or the Eligible
Lender Trustee on behalf of the Trust) in and to the property and rights sold,
transferred and assigned to the Trust pursuant to the 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 Eligible Lender
Trustee and the Trust pursuant to the Trust Agreement, the Administration
Agreement, the Servicing Agreement, any Swap Agreements and any Eligible
Repurchase Obligations.

 

“Trust
Indenture Act” or “TIA” means the Trust Indenture Act of 1939 as in
force on the date hereof, unless otherwise specifically provided.

 

“Trust
Student Loan” means any student loan that is listed on the Schedule of
Trust Student Loans on the Closing Date, plus any student loan that is
permissibly substituted for a Trust Student Loan by the Depositor pursuant to
Sections 6 of the Sale Agreement or by the Servicer pursuant to Section 3.5 of
the Servicing Agreement, but shall not include any Purchased Student Loan
following receipt by or on behalf of the Trust of the Purchase Amount with
respect thereto or any Liquidated Student Loan following receipt by or on
behalf of the Trust of Liquidation Proceeds with respect thereto or following
such Liquidated Student Loan having otherwise been written off by the Servicer.

 

“Trust
Student Loan Files” means the documents specified in Section 2.1 of the
Servicing Agreement.

 

“UCC”
means, unless the context otherwise requires, the Uniform Commercial Code, as
in effect in the relevant jurisdiction, as amended from time to time.

 

“U.S.
Dollar Equivalent Principal Amount” means, with respect to any class of
Reset Rate Notes while in Foreign Exchange Mode, the U.S. Dollar equivalent of
the Outstanding Amount of such class of Reset Rate Notes in Foreign Exchange
Mode as of the date of determination based on the exchange rate provided in the
related Currency Swap Agreement.

 

“U.S. Rule
144A Global Note Certificate” has the meaning specified in Section 2.1 of
the Indenture.

 

A-1-41

 

APPENDIX A-2

 

RESET RATE
NOTE PROCEDURES

 

Section 1.               Definitions:  All terms which are defined in Appendix
A-1 shall have the same meanings in this Appendix A-2.

 

Section 2.               Interest Rates;
Principal Payments: (a)  Each class
of Reset Rate Notes will bear interest for each related Reset Period at the
rate set forth on Schedule A attached to the related Reset Rate Note as
determined in accordance with Section 2(b) below; provided that during
each initial Reset Period, each class of Reset Rate Notes will bear interest
from the Closing Date through and including the related Initial Reset Date at
the rate set forth in the first sentence of the definitions of “Class A-5 Rate”
and “Class A-6 Rate,” respectively. 
Interest on each class of Reset Rate Notes shall be payable by the Trust
with respect to each Distribution Date at the priority level set forth in
Section 2.8(d) of the Administration Agreement; provided that if
interest due to a class of Reset Rate Notes is payable through a Swap
Agreement, the related Swap Interest Payments will be payable by the Trust to
the related Swap Counterparty, and by the Swap Counterparty to the Trust (for
payment to the related Reset Rate Noteholders), as described in Section 10
below.

 

(b)           After each initial Reset Period, either
class of Reset Rate Notes may be reset to bear either a fixed or floating rate
of interest at the option of the Remarketing Agents, in consultation with the
Administrator.  The interest rate of
each class of Reset Rate Notes will be reset as of each related Reset Date as
determined by (i) the Remarketing Agents, in consultation with the
Administrator, with respect to (A) the length of the related Reset Period, (B)
whether the rate is fixed or floating and (x) if floating, the applicable
Index, or (y) if fixed, the applicable pricing benchmark, (C) the applicable
Day Count Basis, (D) the applicable currency denomination, i.e., U.S. Dollars,
Euros, Pounds Sterling or another non-U.S. Dollar currency, (E) if in Foreign
Exchange Mode, the applicable Distribution Dates on which interest will be paid
to the related Reset Rate Noteholders, if other than quarterly, (F) the
applicable Interest Rate Determination Dates within each Accrual Period, (G)
the interval between Interest Rate Change Dates during each Accrual Period and
(H) if applicable, the related All Hold Rate, and (ii) the
Remarketing Agents (in their sole determination) with respect to the setting of
the (A) fixed rate of interest or (B) Spread to the chosen Index, as
applicable.

 

(c)           In the event that any class of Reset Rate
Notes is reset (i) to bear (or continue to bear) interest at a floating rate,
(ii) to bear (or continue to bear) a fixed rate of interest and/or (iii) to be
denominated (or continue to be denominated) in a currency other than U.S.
Dollars, and the Remarketing Agents, in consultation with the Administrator
determine that it would be in the best interest of the Trust based on existing
market conditions to enter into one or more Swap Agreements, the Administrator
will be responsible for arranging, on behalf of the Trust, one or more Swap
Agreements to hedge the basis risk and/or currency exchange risk (as
applicable) and, together with the Remarketing Agents, for selecting the Swap
Counterparties thereto in accordance with the procedures set forth in Section
10(d) below.  No class of Reset Rate
Notes will be reset (or continue) to bear interest at a floating rate that is
not based on LIBOR or a Commercial Paper Rate, at a fixed rate or to be
denominated in a currency other than U.S. Dollars unless one or more Swap
Agreements are entered into as of the related Reset Date that

 

A-2-1

 

results in the Rating Agency Condition being
satisfied.  In connection with each Swap
Agreement, the Remarketing Agents shall solicit bids from Eligible Swap
Counterparties in accordance with the procedures set forth in Section 10(d)
below.

 

(d)           Each class of Reset Rate Notes shall be
entitled either (i) to receive payments of principal in reduction of its
Outstanding Amount on each Distribution Date at the priority level set forth in
Section 2.8(f) of the Administration Agreement or (ii) if such class is then
structured not to receive a payment of principal until the end of the related
Reset Period, to receive allocations of principal at the priority level set
forth in Section 2.8(f) of the Administration Agreement on each Distribution
Date; provided, however, that such amounts referred to in this
clause (ii) shall not be paid in reduction of the Outstanding Amount of such
class of Reset Rate Notes, and instead all such amounts shall be deposited into
the related Accumulation Account for payment to the related Reset Rate
Noteholders or the related Currency Swap Counterparty, as applicable, on or
about the next related Reset Date as set forth in Section 11(a) below.

 

Section 3.               End of Reset
Period Notice:  (a)  Unless the holder of the related Call Option
has delivered the related Call Option Notice, the Administrator, not less than
fifteen nor more than thirty calendar days prior to any Remarketing Terms
Determination Date, will (i) give written notice (including facsimile or
other electronic transmission, if permitted pursuant to the recipient’s
standard procedures) to the applicable Clearing Agencies and the Luxembourg
Stock Exchange (for so long as the related class of Reset Rate Notes is listed
on such exchange), with a copy to the Indenture Trustee, notifying them of the
upcoming Reset Date and the identities of the related Remarketing Agents and
stating whether tender is deemed mandatory or optional for the applicable class
of Reset Rate Notes on the related Reset Date (the “ “Initial Reset Date
Notice”), (ii) request that each Clearing Agency notify its participants
of (1) the contents of the Initial Reset Date Notice, (2) the Remarketing Terms
Notice to be given on the Remarketing Terms Determination Date pursuant to
Section 4(d) below, (3) the Spread Determination Notice to be given on the
Spread Determination Date pursuant to Section 9(e) below, and (4) if
applicable, the procedures concerning the timely delivery of a Hold Notice
pursuant to Section 8 below that must be followed if any beneficial owner of a
class of Reset Rate Notes wishes to retain its Reset Rate Notes.  For so long as the related class of Reset
Rate Notes is listed on the Luxembourg Stock Exchange, a copy of such notices
will be sent to the Luxembourg Stock Exchange and each of the Remarketing Terms
Notice and the Spread Determination Notice will also be published in a leading
newspaper having general circulation in Luxembourg (which is expected to be The
Luxemburger
Wort) and (iii) initiate discussions with representatives of the
Luxembourg Stock Exchange regarding an addendum to the Offering Memorandum
dated August 17, 2004, if required by Section 7(f)(i) of the Remarketing
Agreement.

 

(b)           The Administrator will also include in each
Initial Reset Date Notice the names and contact information of the Luxembourg
Listing Agent, if applicable, and any Remarketing Agents confirmed or appointed
by the Administrator, or if no Remarketing Agents have then been so chosen, the
Administrator will provide adequate contact information for Reset Rate Noteholders
to receive information regarding the upcoming Reset Date.

 

(c)           If the related Clearing Agency or its
respective nominee, as applicable, is no longer the holder of record of the
related class of Reset Rate Notes, the Administrator, or the Remarketing Agents
on its behalf, will send the related Reset Rate Noteholders, with a copy to

 

A-2-2

 

the Indenture Trustee and the Luxembourg
listing agent, as applicable, the required notices setting forth the information
in Sections 3(a) and 3(b) above not less than fifteen nor more than thirty
calendar days prior to any Remarketing Terms Determination Date.  In addition, in the event that Definitive
Notes evidencing an interest in any class of Reset Rate Notes are issued, the
Administrator shall cause the Note Registrar to provide to the relevant Reset
Rate Noteholders and the Luxembourg listing agent, as applicable, any
additional procedures applicable to such Reset Rate Notes while in definitive
form.

 

Section 4.               Remarketing
Terms Determination Date:  (a)  Subject to the provisions of the Remarketing
Agreement, prior to the Remarketing Terms Determination Date, and unless the
holder of the related Call Option has delivered the related Call Option Notice,
the Administrator shall re-affirm the capability of the initial Remarketing
Agents to perform under the Remarketing Agreement, and/or enter into new
remarketing agreements with other or additional remarketing agents, who shall
function as the Remarketing Agents with respect to the related Reset Date.  On each Remarketing Terms Determination
Date, the Trust, the Administrator and the Remarketing Agents will enter into a
Remarketing Agency Agreement for the remarketing of the related class of Reset
Rate Notes.

 

(b)           If the Remarketing Agents, in consultation
with the Administrator, determine prior to the Remarketing Terms Determination
Date that any Currency Swap Agreements required pursuant to Section 2(c)(iii)
above will not be obtainable on the related Reset Date, the related class of
Reset Rate Notes must be denominated in U.S. Dollars during the next related
Reset Period.

 

(c)           Unless the holder of the related Call Option
has delivered the related Call Option Notice, on or prior to the Remarketing
Terms Determination Date the Remarketing Agents will notify the related Reset
Rate Noteholders whether tender is deemed mandatory or optional and, in
consultation with the Administrator, will establish the following terms for the
related class of Reset Rate Notes to be applicable during the immediately
following related Reset Period:

 

(i)            the
expected weighted average life of that class of Reset Rate Notes, based on
prepayment and other assumptions customary for comparable securities;

 

(ii)           the
name and contact information of the Remarketing Agents;

 

(iii)          the
next Reset Date and length of such Reset Period;

 

(iv)          the
interest rate mode (i.e., fixed rate or floating rate);

 

(v)           the
currency denomination;

 

(vi)          the
applicable minimum denominations and additional increments for such class of
Reset Rate Notes;

 

(vii)         if
both classes of Reset Rate Notes are successfully remarketed on the same Reset
Date, whether there will be any change in the relative priorities with respect
to the right to receive payments of principal;

 

A-2-3

 

(viii)        if
in Foreign Exchange Mode, the identities of the Eligible Swap Counterparties
from which bids will be solicited;

 

(ix)           if
in Foreign Exchange Mode, the applicable Distribution Dates on which interest
and principal will be paid to the related Reset Rate Noteholders, if other than
quarterly;

 

(x)            whether
the applicable class will be structured to amortize periodically or to receive
a payment of principal only at the end of the related Reset Period;

 

(xi)           if
in floating rate mode, the applicable Index;

 

(xii)          if
in floating rate mode, the interval between Interest Rate Change Dates;

 

(xiii)         if
in floating rate mode, the applicable Interest Rate Determination Date;

 

(xiv)        if
in fixed rate mode, the applicable fixed rate pricing benchmark;

 

(xv)         if
in fixed rate mode, the identities of the Eligible Swap Counterparties from
which bids will be solicited;

 

(xvi)        if
in floating rate mode, whether there will be a related Swap Agreement and, if
so, the identities of the Eligible Swap Counterparties from which bids will be
solicited;

 

(xvii)       the
applicable Day Count Basis;

 

(xviii)      the
related All Hold Rate, if applicable;

 

(xix)         if
Definitive Notes are to be issued, the procedures for delivery and exchange of
Definitive Notes and for dealing with lost or mutilated notes; and

 

(xx)          any
other relevant terms incidental to the foregoing (other than the related Spread
or fixed rate of interest, as applicable) for the next Reset Period;

 

provided
that any interest rate mode, other than a floating rate based on LIBOR or a
Commercial Paper Rate, will require that the Rating Agency Condition be
satisfied prior to the delivery of the related Remarketing Terms Notice.

 

(d)           The Remarketing Agents will communicate all
of the information established in Section 4(c) above in the Remarketing Terms
Notice required to be given in writing (including facsimile or other electronic
transmission if in accordance with each Clearing Agency’s standard procedures)
to each Clearing Agency (and the Luxembourg Stock Exchange if the Reset Rate
Notes are then listed on such exchange) or to the related Reset Rate
Noteholders if Definitive Notes have been issued, as applicable, the Indenture
Trustee and the Rating Agencies on the Remarketing Terms Determination Date.

 

A-2-4

 

(e)           In addition, prior to the Remarketing Terms
Determination Date, the Administrator shall cause the Schedule Replacement
Order with respect to the related Reset Rate Notes to be delivered to the
Indenture Trustee, the Clearing Agencies and, if the related class of Reset
Rate Notes is then listed on the Luxembourg Stock Exchange, the Luxembourg
Listing Agent.

 

Section 5.               All Hold Rate:  (a) 
On each Remarketing Terms Determination Date for a class of Reset Rate
Notes which is denominated in U.S. Dollars during both the then-current Reset
Period and the immediately following Reset Period, the Remarketing Agents, in
consultation with the Administrator, will establish the related All Hold Rate
for that class of Reset Rate Notes. 
With respect to any class of Reset Rate Notes that is either in Foreign
Exchange Mode during the then-current Reset Period or will be reset into
Foreign Exchange Mode on the immediately following Reset Date, all related
Reset Rate Noteholders will be deemed to have tendered their Notes on the
related Reset Date, regardless of any desire by such Reset Rate Noteholders to
retain their ownership thereof, and no All Hold Rate will be applicable.

 

(b)           The All Hold Rate will only be applicable if
100% of the Reset Rate Noteholders of a class deliver timely Hold Notices
wherein they elect to hold their Reset Rate Notes for the next related Reset
Period.  If applicable, the related interest
rate for that class of Reset Rate Notes during the immediately following Reset
Period will not be less than the All Hold Rate.  If the rate of interest using the Spread or fixed rate of
interest established on the Spread Determination Date is higher than the All
Hold Rate, then upon a successful remarketing of the related class of Reset
Rate Notes, all related Reset Rate Noteholders who delivered a Hold Notice
agreeing to be subject to the All Hold Rate instead will be entitled to the
higher rate of interest during the immediately following Reset Period.

 

Section 6.               Failed
Remarketing:  (a)  With respect to each Reset Date for which
the holder of the related Call Option does not deliver the related Call Option
Notice, a Failed Remarketing will be declared by the Remarketing Agents and the
provisions of this Section 6 will apply if any of the conditions set forth in
the definition of “Failed Remarketing” are applicable.  In order to prevent the declaration of a
Failed Remarketing, the Remarketing Agents will have the option, but not the
obligation, to purchase any Reset Rate Notes tendered that they are not
otherwise able to remarket or with respect to which a committed purchaser
defaults on their purchase obligations.

 

(b)           At any time a Failed Remarketing is
declared: (i) all related Reset Rate Notes will be retained by the related
Reset Rate Noteholders on the related Reset Date, regardless of any deemed
mandatory or voluntary tenders made to the Remarketing Agents, (ii) the Failed
Remarketing Rate for such class of Reset Rate Notes will apply for the related
Reset Period and (iii) a Reset Period of three months will be established.  In addition, if a class of Reset Rate Notes
are in Foreign Exchange Mode at the time a Failed Remarketing is declared, the
provisions of Sections 10(a)(i) and (ii) shall also apply.

 

(c)           If there is a Failed Remarketing of a class
of Reset Rate Notes, the related Reset Rate Noteholders shall not be entitled
to exercise any remedies as a result of the failure of their class of Reset
Rate Notes to be remarketed on the related Reset Date.

 

A-2-5

 

Section 7.               Call Option:  (a) 
With respect to each Reset Date, the Depositor, as the initial holder of
the Excess Distribution Certificate, is hereby granted a Call Option for the
purchase of not less than 100% of the related class of Reset Rate Notes,
exercisable at a price equal to 100% of the Outstanding Amount of that class of
Reset Rate Notes, less all amounts distributed to the related Reset Rate
Noteholders as a payment of principal with respect to the related Distribution
Date(s), plus any accrued and unpaid interest not paid by the Trust with
respect to the applicable Reset Date.

 

(b)           The Depositor, as the initial holder of the
Excess Distribution Certificate, effective as of the Closing Date, hereby
transfers all of its right title and interest in and to each Call Option to SLM
Education Credit Finance Corporation, which upon receipt thereof will dividend
all of its right, title and interest in and to each Call Option to SLM
Corporation, and in acceptance of such transfer SLM Corporation also hereby
agrees to abide by all terms and conditions hereunder with respect to each Call
Option as set forth in these Reset Rate Note Procedures.

 

(c)           SLM Corporation may further transfer
ownership of either Call Option at any time to one of its Affiliates; provided
that such permitted transferee has at no time in the past owned, and is not
obligated under either the Purchase Agreements or the Sale Agreement to
transfer, an interest in any of the Trust Student Loans.

 

(d)           A Call Option may be exercised with respect
to the related class of Reset Rate Notes at any time on or prior to the
determination of the related Spread or fixed rate or the declaration of a
Failed Remarketing, as applicable, on the related Spread Determination Date by
delivery of a Call Option Notice; provided that such Call Option may not
be exercised before the day following the last Distribution Date immediately
preceding the next applicable Reset Date. 
In addition, for so long as the related class of Reset Rate Notes is
listed on the Luxembourg Stock Exchange, the holder of the related Call Option
shall cause a notice of the exercise of the related Call Option to be published
in a leading newspaper having general circulation in Luxembourg (which is
expected to be The Luxemburger Wort). 
Once written notice of the exercise of a Call Option is given, such
exercise may not be rescinded.

 

(e)           All amounts due and owing to the related
Reset Rate Noteholders shall be remitted on or before the related Reset Date by
the holder of the related Call Option in accordance with the standard
procedures established by the Clearing Agencies for transfer of securities to
ensure timely payment of principal to the related Reset Rate Noteholders on the
related Reset Date.

 

(f)            In the event that a Call Option is
exercised with respect to a class of Reset Rate Notes then in Foreign Exchange
Mode, the holder of such Call Option shall deliver the U.S. Dollar Equivalent
Principal Amount remaining after all payments of principal are made with
respect to the related Distribution Date, and interest (if applicable) owing to
the Reset Rate Noteholders to the Remarketing Agents for delivery to the Swap
Counterparties to the related Currency Swap Agreements, who shall exchange such
amount into the applicable currency for delivery to the related Reset Rate
Noteholders; provided, however, that if there are no such
Currency Swap Agreements then in effect, the holder of such Call Option shall
remit all amounts due and owing to the Remarketing Agents for delivery to the
Reset Rate Noteholders in the

 

A-2-6

 

applicable currency on or before the Reset
Date in accordance with the standard procedures established by the related
Clearing Agencies for transfer of securities to ensure timely payment of
principal to the related Reset Rate Noteholders on the related Reset Date.

 

(g)           If a Call Option is exercised with respect
to any class of Reset Rate Notes, (i) the interest rate on that class of Reset
Rate Notes will be the Call Rate, (ii) that class of Reset Rate Notes will
be denominated in U.S. Dollars and (iii) a Reset Period of three months
will be established.  At the end of such
three month Reset Period, the holder of the related Call Option may either
remarket the related class of Reset Rate Notes pursuant to the remarketing
procedures set forth herein and in the Remarketing Agreement, or retain that
class of Reset Rate Notes for one or more successive three-month Reset Periods
at the then-current Call Rate.  In the
event the holder of the related Call Option chooses to remarket any class of
Reset Rate Notes, such holder shall be solely responsible for all costs and
expenses relating to the preparation of any new offering document and any other
related costs and expenses associated with such remarketing, other than the
fees of the Remarketing Agents, as more fully set forth in Section 3 of the
Remarketing Agreement.

 

(h)           Other than in connection with the exercise
of a Call Option, neither SLM Corporation, SLMA, the Trust or any of their
Affiliates shall have the ability to purchase any Reset Rate Notes tendered to
the Remarketing Agents.

 

Section 8.               Hold Notice:  For a class of Reset Rate Notes that is
denominated in U.S. Dollars during both the then-current Reset Period and the
immediately following Reset Period, the related Reset Rate Noteholders will
have the option to deliver a Hold Notice to any Remarketing Agent setting forth
their desire to hold their Reset Rate Notes for the next Reset Period at a rate
of interest not less than the All Hold Rate and on the terms set forth in the
related Remarketing Terms Notice, at any time on or after the Remarketing Terms
Determination Date until the Notice Date. 
Such Hold Notice may be delivered as an oral statement to a Remarketing
Agent, if subsequently confirmed in writing within 24 hours, which confirmation
may be in the form of an e-mail if timely received by the Remarketing
Agent.  If a Reset Rate Noteholder does
not timely deliver a Hold Notice to a Remarketing Agent (such Hold Notice not
to be considered delivered until actually received by such Remarketing Agent),
that Reset Rate Noteholder will be deemed to have tendered for remarketing 100%
of the Outstanding Amount of its related class of Reset Rate Notes.  Any duly delivered Hold Notice will be
irrevocable, but will be subject to a mandatory tender of the applicable Reset
Rate Notes pursuant to any exercise of the related Call Option.  All of the Reset Rate Notes of an applicable
class, whether tendered or not, will bear interest during any related Reset
Period on the same terms.

 

Section 9.               Spread
Determination Date:  (a)  On each Spread Determination Date, unless a
Failed Remarketing has been declared or the holder of the related Call Option
has delivered the related Call Option Notice, the Administrator, the Trust and
the Remarketing Agents will enter into a Supplemental Remarketing Agency
Agreement.

 

(b)           If pursuant to the Remarketing Terms Notice,
the Remarketing Agents, in consultation with the Administrator, have determined
that a class of Reset Rate Notes is to be reset to bear a fixed rate of
interest, then the applicable fixed rate of interest for the corresponding
Reset Period will be determined on the Spread Determination Date by adding

 

A-2-7

 

(i) the applicable spread as determined
by the Remarketing Agents on the Spread Determination Date and (ii) the
yield to maturity on the Spread Determination Date of the applicable fixed rate
pricing benchmark, selected by the Remarketing Agents, as having an expected
weighted average life based on a scheduled maturity at the next Reset Date,
which would be used in accordance with customary financial practice in pricing
new issues of asset-backed securities of comparable average life; provided
that such fixed rate of interest will in no event be lower than the related All
Hold Rate, if applicable.  The
Remarketing Agents shall determine the applicable fixed rate of interest for
such class of Reset Rate Notes (by reference to the applicable fixed rate
pricing benchmark plus or minus the spread determined on the Remarketing Terms
Determination Date) on each Spread Determination Date irrespective of whether
no remarketing will occur as the result of the application of the All Hold
Rate, if applicable.  In addition, on
the related Spread Determination Date, the Remarketing Agents, in consultation
with the Administrator, shall determine the Supplemental Interest Account
Deposit Amount, if any, for that class of Reset Rate Notes.

 

(c)           If pursuant to the Remarketing Terms Notice,
the Remarketing Agents, in consultation with the Administrator, have determined
that a class of Reset Rate Notes is to be reset to bear a floating rate of interest,
then, on the related Spread Determination Date, the Remarketing Agents will
establish the applicable Spread to be added or subtracted from the applicable
Index; provided that such floating rate of interest will in no event be
lower than the related All Hold Rate, if applicable.  In addition, on the related Spread Determination Date, the
Remarketing Agents, in consultation with the Administrator, shall determine the
Supplemental Interest Account Deposit Amount, if any, for that class of Reset
Rate Notes.

 

(d)           If required pursuant to Section 2(c) above,
on the related Reset Date the Trust shall enter into either (i) one or more
Currency Swap Agreements, if the related class of Reset Rate Notes is to be
reset in Foreign Exchange Mode, or (ii) one or more Interest Rate Swap
Agreements if the related class of Reset Rate Notes is to be reset in U.S.
Dollars and to bear interest at a fixed rate or at a floating rate other than
one based on LIBOR or a Commercial Paper Rate, with an Eligible Swap Counterparty.

 

(e)           On or immediately following the Spread
Determination Date, the Remarketing Agents will communicate in writing
(including facsimile or other electronic transmission if in accordance with
each Clearing Agency’s standard procedures) the contents of the Spread
Determination Notice to each Clearing Agency (and the Luxembourg Stock Exchange
if the related class of Reset Rate Notes is then listed on such exchange) or
the Reset Rate Noteholders if Definitive Notes have been issued, as applicable,
with instructions to distribute such notices to its related participants, or to
the related Reset Rate Noteholders, as applicable, the Indenture Trustee and
the Rating Agencies.  The Spread
Determination Notice will contain: (i) the determined Spread or fixed rate of
interest, as the case may be, or, if applicable, a statement that the All Hold
Rate or the Failed Remarketing Rate will be in effect for the immediately
following Reset Period, (ii) any applicable currency exchange rate, (iii) the
identity of any selected Swap Counterparty or Counterparties, if applicable,
(iv) if applicable, the floating rate (or rates) of interest to be due to each
selected Swap Counterparty with respect to each Distribution Date during the
immediately following Reset Period and (v) any other information that the
Administrator or the Remarketing Agents deem applicable.  Furthermore, for each class of Reset Rate
Notes to be reset in Foreign Exchange Mode, the currency exchange rate, the
Extension

 

A-2-8

 

Rate due to each related Currency Swap
Counterparty and the Failed Remarketing Rate applicable to such class for the
immediately following Reset Period will be determined pursuant to the terms of
the related Currency Swap Agreement and contained in the Spread Determination
Notice.  In addition, if required for
the immediately following Reset Period, on or before the related Spread
Determination Date the Administrator will arrange for new or additional securities
identification codes to be obtained as required.

 

Section 10.             Swap Agreements:

 

(a)           If a class of Reset Rate Notes is to be
reset in Foreign Exchange Mode, on the related Reset Date, the Administrator
will enter into (not in its individual capacity, but solely as Administrator on
behalf of the Trust) or will instruct the Eligible Lender Trustee to enter into
(not in its individual capacity, but solely as Eligible Lender Trustee) one or
more Currency Swap Agreements for the related Reset Period.

 

(i)            Each
Currency Swap Counterparty which is party to a related Currency Swap Agreement
will be entitled to receive: (A) on the effective date of such Currency Swap
Agreement, all secondary market trade proceeds received from purchasers of the
related class of Reset Rate Notes in the applicable currency, (B) with respect
to each applicable Distribution Date, (x) an interest rate of Three-Month
LIBOR, plus or minus a spread, as determined from the bidding process described
in Section 10(d) below (other than as may be interpolated for an initial or final
calculation period under that Currency Swap Agreement), multiplied by the U.S.
Dollar Equivalent Principal Amount of the related class of Reset Rate Notes,
and multiplied by a fraction determined by the number of days in the applicable
Accrual Period and the applicable Day Count Basis and (y) all payments of
principal in U.S. Dollars that are allocated to the related class of Reset Rate
Notes; provided that if the related class of Reset Rate Notes is then
structured not to receive a payment of principal until the end of the related
Reset Period, all principal payments allocated to the Reset Rate Notes on any
Distribution Date will be deposited into the related Accumulation Account and
paid to the related Swap Counterparties on or about the next Reset Date as set
forth in the related Currency Swap Agreements (including all sums required to
be deposited therein on the Reset Date), but excluding all Investment Earnings
thereon, and (C) on a Reset Date corresponding to a successful remarketing or
an exercise of the related Call Option, all U.S. Dollar currency equivalent of
all secondary market trade proceeds or proceeds from the exercise of the
related Call Option, as applicable, received from the Remarketing Agents
directly from purchasers of the related class of Reset Rate Notes (if in U.S.
Dollars), from the new Currency Swap Counterparty or Counterparties, as
applicable (if in non-U.S. Dollar currency) or from the holder of the related
Call Option, as applicable.  With
respect to the Initial Currency Swap Agreements, the Initial Currency Swap
Counterparty shall be entitled to receive on the Closing Date in lieu of
secondary market proceeds described in clause (A) above, all applicable
non-U.S. Dollar currency proceeds received by the Trust from purchasers of the
related Reset Rate Notes (which shall be net of any underwriting commission or
discount owing to the Initial Purchasers of such Notes).

 

(ii)           In
addition, each related Currency Swap Counterparty will be obligated to pay to
the Trust (for payment to the related Reset Rate Noteholders, if applicable):
(A) on

 

A-2-9

 

the effective
date of such Currency Swap Agreement, the U.S. Dollar equivalent of all
secondary market trade proceeds received from purchasers of the related Reset
Rate Notes, (B) with respect to each applicable Distribution Date, (x) their
applicable percentage of the applicable rate of interest on the related class
of Reset Rate Notes multiplied by the U.S. Dollar Equivalent Principal Amount
of the related class of Reset Rate Notes and multiplied by a fraction
determined by the number of days in the applicable Accrual Period and the
applicable Day Count Basis, and (y) the applicable non-U.S. Dollar currency
equivalent of the U.S. Dollars such Swap Counterparty concurrently receives
from the Trust as a payment of principal allocated to the related class of
Reset Rate Noteholders (including, on the related Maturity Date for such class
of Reset Rate Notes, if a Currency Swap Agreement is then in effect, the
remaining Outstanding Amount of such class of Reset Rate Notes) but only to the
extent that the required U.S. Dollar Equivalent Principal Amount is received
from the Trust on such date, at an exchange rate to be set on the effective
date of and set forth in the related Currency Swap Agreement, (C) on the second
Business Day following a Distribution Date that is also a Reset Date (other
than for any Reset Period following a Reset Date upon which a Failed
Remarketing has occurred, up to and including the Reset Date resulting in a
successful remarketing or an exercise of the related Call Option) their
applicable percentage of interest at the interest rate from and including the
related Reset Date to, but excluding, the second Business Day following such
Reset Date, and (D) on a related Reset Date corresponding to a successful
remarketing or an exercise of the related Call Option, the applicable currency
equivalent of all U.S. Dollar secondary market trade proceeds received by the
Trust from the purchasers of the related Reset Rate Notes or proceeds received
by the Trust from the exercise of the related Call Option, as applicable, at an
exchange rate to be set on the effective date of and set forth in the related
Currency Swap Agreement.  With respect
to the Initial Currency Swap Agreement, the Initial Currency Swap Counterparty
shall be obligated to pay to the Trust on the Closing Date in lieu of the
payments described in clause (A) above, the U.S. Dollar Equivalent Principal
Amount of the applicable non-U.S. Dollar currency received by the Trust from
the sale of the applicable class of Reset Rate Notes.  For any Reset Period following a Reset Date upon which a Failed
Remarketing has occurred, up to any including the Reset Date resulting in a
successful remarketing or an exercise of the related Call Option for that class
of Reset Rate Notes, payments of interest and principal to that class of Reset
Rate Noteholders will be made on the second Business Day following the related
Reset Date without the payment of any additional interest.

 

(b)           [Reserved.]

 

(c)           On each Reset Date if a class of Reset Rate
Notes is to be reset in U.S. Dollars, and a Swap Agreement is required pursuant
to Sections 2(c) and 9(d) above, then the Administrator will enter into (not in
its individual capacity, but solely as Administrator on behalf of the Trust) or
will instruct the Eligible Lender Trustee to enter into (not in its individual
capacity, but solely as Eligible Lender Trustee), one or more Interest Rate
Swap Agreements for the next Reset Period to facilitate the Trust’s ability to
pay applicable interest at the related interest rate.

 

A-2-10

 

(i)            Each
Swap Counterparty which is party to a related Interest Rate Swap Agreement will
be entitled to receive on each Distribution Date an interest rate of
Three-Month LIBOR, plus or minus a spread, as determined from the bidding
process described in Section 10(d) below, multiplied by the Outstanding Amount
of the related class of Reset Rate Notes and multiplied by a fraction
determined by the number of days in the applicable Accrual Period and the
applicable Day Count Basis.

 

(ii)           In
addition, each related Swap Counterparty which is a party to a related Interest
Rate Swap Agreement will be obligated to pay to the Trust on each Distribution
Date, the applicable rate of interest on the related class of Reset Rate Notes
multiplied by the Outstanding Amount of the related class of Reset Rate Notes
and multiplied by a fraction determined by the number of days in the applicable
Accrual Period and the applicable Day Count Basis.

 

(d)           Other than with respect to the Initial
Currency Swap Agreements, the Remarketing Agents, in consultation with the
Administrator, in determining the Swap Counterparty to each required Swap
Agreement, will solicit bids from at least three Eligible Swap Counterparties
and will select the lowest of these bids to provide the interest rate swap
and/or currency exchange swap(s).  If the
lowest bidder specifies a notional amount that is less than the Outstanding
Amount of the related class of Reset Rate Notes, the Remarketing Agents, in
consultation with the Administrator, may select more than one Eligible Swap
Counterparty, but only to the extent that such additional Eligible Swap
Counterparties have provided the next lowest received bid or bids, and enter
into more than one Swap Agreement that result in the Rating Agency Condition
being satisfied.

 

(e)           Other than with respect to the Initial
Currency Swap Agreements, it is a condition precedent to the entering into of
any Swap Agreement and the setting of the amount to be paid to the related Swap
Counterparty that the Rating Agency Condition is satisfied.  No Swap Agreement will be entered into or
caused to be entered into by the Trust, the Administrator on its behalf or the
Remarketing Agents, for any Reset Period where either the related Call Option
has been exercised or a Failed Remarketing has been declared.

 

(f)            Each Currency Swap Agreement will terminate
at the earliest to occur of (i) the next succeeding Reset Date for which
there is a successful remarketing, (ii) the Reset Date for which the related
Call Option is exercised, (iii) the Distribution Date on which the
Outstanding Amount of the related class of Reset Rate Notes is reduced to zero
(including as the result of the optional purchase of the remaining Trust
Student Loans by the Servicer or an auction of the Trust Student Loans by the
Indenture Trustee) or (iv) the Maturity Date of the related class of Reset
Rate Notes.  No Currency Swap Agreement
will terminate solely due to the declaration of a Failed Remarketing.  Each Interest Rate Swap Agreement will
terminate on the earliest to occur of the next Reset Date, or the occurrence of
an event specified in clause (iii) or (iv) above.

 

(g)           With respect to each Currency Swap
Agreement, and in the event that a Failed Remarketing is declared, the rate of
interest due to each related Currency Swap Counterparty from the Trust on each
Distribution Date will be increased to the Extension Rate and the rate due to
the Trust from each related Currency Swap Counterparty will change to equal the
Failed Remarketing Rate.

 

A-2-11

 

Section 11.             Accumulation
Accounts; Supplemental Interest Accounts: 
(a)  If, on any Distribution
Date, principal would be payable to a class of Reset Rate Notes which is then
structured not to receive a payment of principal until the end of the related
Reset Period, that principal (subject to sufficient Available Funds therefor)
will be allocated to that class of Reset Rate Notes and deposited into the
related Accumulation Account, where it will remain until the next Reset Date
for that class (except that if a class of Reset Rate Notes is in Foreign
Exchange Mode, principal will be paid according to the provisions of Sections
10(a)(i) and (a)(ii) above), unless an Event of Default under the Indenture or
a sale of the Trust Estate pursuant to Section 6.1 of the Administration
Agreement has occurred (in which case the Indenture Trustee will distribute all
sums on deposit therein (exclusive of Investment Earnings) to the related Reset
Rate Noteholders in accordance with the provisions of Section 5.4(b) of the
Indenture or Section 6.1 of the Administration Agreement, as applicable).

 

(b)           On each Reset Date, for a class of Reset
Rate Notes that was structured during the preceding Reset Period not to receive
a payment of principal until the end of the related Reset Period, all sums, if
any, then on deposit in the related Accumulation Account, including any
allocation of principal made on the same date, but less any Investment
Earnings, will be distributed by the Indenture Trustee, at the direction of the
Administrator, as set forth in Section 2.8 of the Administration Agreement, (x)
to the holders of that class of Reset Rate Notes, as of the related Record
Date, or (y) if a class of Reset Rate Notes is then in Foreign Exchange Mode
(including during the related initial Reset Period), to the related Currency
Swap Counterparty or Counterparties for the benefit of such Reset Rate
Noteholders as of the Record Date pursuant to the provisions of Section
10(a)(i) and (a)(ii) above, in reduction of principal of such Reset Rate Notes;
provided that in the event on any Distribution Date the amount on
deposit in the related Accumulation Account (excluding any Investment Earnings)
would equal the Outstanding Amount of that class of Reset Rate Notes, no
additional amounts will be deposited into the related Accumulation Account and
all amounts therein, less any Investment Earnings, will be distributed by the
Indenture Trustee, at the direction of the Administrator, as set forth in
Section 2.8 of the Administration Agreement, on the next related Reset Date to
the related Reset Rate Noteholders or the related Currency Swap Counterparty or
Counterparties (as applicable), and on such Reset Date that class of Reset Rate
Notes will no longer be Outstanding. 
Amounts on deposit in an Accumulation Account (exclusive of Investment
Earnings) may be used only to pay principal on the related class of Reset Rate
Notes (or to the related Currency Swap Counterparty or Counterparties) and for
no other purpose.  On each Distribution
Date, all Investment Earnings on deposit in an Accumulation Account will be withdrawn
by the Indenture Trustee, at the direction of the Administrator and deposited
into the Collection Account.

 

(c)           The Indenture Trustee, subject to sufficient
available funds therefor, at the direction of the Administrator and pursuant to
Section 2.10(d)(ii) of the Administration Agreement, will deposit into a
Supplemental Interest Account, the related Supplemental Interest Account
Deposit Amount.  On each Distribution
Date, all sums (which shall include Investment Earnings) on deposit in each
Supplemental Interest Account will be withdrawn by the Indenture Trustee, at
the direction of the Administrator, as set forth in Section 2.10(d)(iii) of the
Administration Agreement, and deposited into the Collection Account.

 

Section 12.             Remarketing
Agents; Remarketing Fee Account: (a) The initial Remarketing Agents,
appointed pursuant to the terms of the Remarketing Agreement, are

 

A-2-12

 

Morgan Stanley
& Co. Incorporated and Merrill Lynch, Pierce, Fenner & Smith
Incorporated.  The terms and conditions
of the Remarketing Agreement will govern the duties and obligations of the
Remarketing Agents.  The Administrator,
the Trust and the Remarketing Agents will enter into on each (A) related
Remarketing Terms Determination Date and a related Remarketing Agency
Agreement, in form and substance substantially the same as Appendix B to the
Remarketing Agreement, unless (i) a Failed Remarketing is declared, or (ii) the
holder of the related Call Option has delivered the related Call Option Notice
on or prior to such date; and (B) related Spread Determination Date, a
Supplemental Remarketing Agency Agreement, in form and substance substantially
the same as Appendix C to the Remarketing Agreement, unless (i) a Failed Remarketing
is declared, (ii) the holder of the related Call Option has delivered the
related Call Option Notice on or prior to such date, or (iii) if applicable,
100% of the related Reset Rate Noteholders have timely delivered a Hold Notice
and the All Hold Rate will apply for the next related Reset Period.

 

(b)           [Reserved.]

 

(c)           Excluding all Reset Rate Notes of a class
for which a Remarketing Agent has received a timely delivered Hold Notice, if
applicable (or if the holder of the related Call Option has delivered the
related Call Option Notice), on the Reset Date that commences each Reset
Period, each related Reset Rate Note will be automatically tendered, or deemed
tendered, to the relevant Remarketing Agent for remarketing by such Remarketing
Agent on the Reset Date at 100% of its Outstanding Amount.  If the related class of Reset Rate Notes is
held in book-entry form, 100% of the Outstanding Amount of such Reset Rate
Notes will be paid by the Remarketing Agents in accordance with the standard
procedures of the applicable Clearing Agencies.

 

(d)           The Remarketing Agents will attempt, on a
reasonable efforts basis and in accordance with the terms and conditions of the
Remarketing Agreement and the related Remarketing Agency Agreement, to remarket
the tendered Reset Rate Notes of the applicable class at a price equal to 100%
of the Outstanding Amount of the related class of Reset Rate Notes so tendered.

 

(e)           Purchasers of the related class of Reset
Rate Notes will be credited with their positions on the applicable Reset Date
with respect to positions held through DTC or on the next Business Day with
respect to positions held through the European Clearing Systems.  No payment delay to existing Reset Rate
Noteholders holding U.S. Dollar-denominated Reset Rate Notes through DTC will
occur on the related Reset Date for any class of Reset Rate Notes denominated
in U.S. Dollars during the immediately following Reset Period.

 

(f)            Each of the Remarketing Agents, in its
individual or any other capacity, may buy, sell, hold and deal in any class of
Reset Rate Notes, including, but not limited to, purchasing any tendered Reset
Rate Notes as part of the remarketing process. 
Any Remarketing Agent that owns a Reset Rate Note may exercise any vote
or join in any action which any beneficial owner of such class of Reset Rate
Notes may be entitled to exercise or take with like effect as if it did not act
in any capacity under the Remarketing Agreement or Remarketing Agency
Agreement.  Any Remarketing Agent, in
its individual capacity, either as principal or agent, may also engage in or
have an interest in any financial or other transaction with the Trust, the
Depositor, the

 

A-2-13

 

Servicer, the Indenture Trustee (in its
individual capacity), the Eligible Lender Trustee (in its individual capacity)
or the Administrator as freely as if it did not act in any capacity under the
Remarketing Agreement or any Remarketing Agency Agreement.  No Reset Rate Noteholder or beneficial owner
of any Reset Rate Note will have any rights or claims against any Remarketing
Agent as a result of such Remarketing Agent’s not purchasing any tendered Reset
Rate Note, which results in the declaration of a Failed Remarketing.

 

(g)           Each of the Remarketing Agents will be
entitled to receive a fee in connection with their services rendered for each
successful remarketing of a class of Reset Rate Notes in the amount set forth
in the Remarketing Agreement and the related Remarketing Agency Agreement.  Subject to the terms and conditions set
forth in the Remarketing Agreement, the Administrator, in its sole discretion,
may change the Remarketing Agents for any class of Reset Rate Notes for any
Reset Period at any time on or before the related Remarketing Terms
Determination Date.  In addition, the
Administrator will appoint one or more additional Remarketing Agents, if
necessary, for a Reset Date when the related class of Reset Rate Notes will be
remarketed in a non-U.S. Dollar currency. 
Furthermore, a Remarketing Agent may resign at any time; provided
that no resignation may become effective on a date that is later than 15
Business Days prior to a Remarketing Terms Determination Date.

 

(h)           In accordance with Section 2.3(i) of the
Administration Agreement, on the Closing Date, the Trust will establish the
Remarketing Fee Account as an asset of the Trust in the name of the Indenture
Trustee, for the benefit of the Remarketing Agents and the Reset Rate
Noteholders.  The fees associated with
each successful remarketing will be payable directly to the Remarketing Agents
from amounts on deposit from time to time in the Remarketing Fee Account.  On each applicable Distribution Date,
Available Funds will be deposited into the Remarketing Fee Account, in the
priority set forth in Section 2.8(c) of the Administration Agreement, in an
amount up to the Quarterly Funding Amount; provided that if the amount
on deposit in the Remarketing Fee Account, after the payment of any remarketing
fees therefrom, exceeds the sum of the Reset Period Target Amount for all
classes of Reset Rate Notes, such excess will be withdrawn on the related
Distribution Date, deposited into the Collection Account and included in
Available Funds for that Distribution Date. 
All Investment Earnings on deposit in the Remarketing Fee Account will
be withdrawn on the next Distribution Date, deposited into the Collection
Account and included in Available Funds for that Distribution Date.  In the event that the fees owed to any
Remarketing Agent on a Reset Date exceeds the amount then on deposit in the
Remarketing Fee Account, such shortfall shall be paid from Available Funds on
future Distribution Dates in the priority set forth in Section 2.8(n) of the
Administration Agreement.  The Trust
shall also be responsible for certain remarketing costs and expenses to the
extent set forth in Section 3 of the Remarketing Agreement, which shall be paid
on each Distribution Date, to the extent of Available Funds, at the priority
set forth in Section 2.8(o) of the Administration Agreement.

 

Section 13.             Eligible Lender
Trustee:  The Eligible Lender
Trustee is hereby authorized and directed to execute and deliver, not in its
individual capacity, but solely as Eligible Lender Trustee on behalf of the
Trust, the Remarketing Agreement, any Swap Agreements (including the Initial
Currency Swap Agreements) and any required supplement, amendment or replacement
thereof, and all Remarketing Agency Agreements and Supplemental Remarketing
Agency Agreements as the Administrator, in writing and from time to time, shall
instruct the Eligible

 

A-2-14

 

Lender Trustee
to execute.  The Eligible Lender Trustee
shall not be liable to any party, any third party or any Noteholder for any
such actions taken at the written instruction of the Administrator.  Notwithstanding the foregoing, in the event
that the Eligible Lender Trustee declines or fails to execute or deliver any
such document, instrument, certificate or agreement as instructed by the
Administrator, the Administrator is hereby authorized, in its sole discretion,
to execute and deliver, not in its individual capacity but solely as
Administrator on behalf of the Trust, all such required documents, instruments,
certificates and agreements.  The
foregoing authorization shall represent a limited power of attorney granted by
the Trust to the Administrator to act on its behalf, and the Administrator
shall not be liable to any party, any third party or any Noteholder for any
such actions taken in good faith and in accordance with these Reset Rate Note
Procedures.

 

A-2-15

 

APPENDIX A-3

 

TRANSFER RESTRICTIONS
FOR 

THE RESET RATE NOTES

 

1.             Except
as otherwise specified herein or as the context may otherwise require, capitalized
terms used but not otherwise defined in this Appendix A-3 (this “Appendix”) are
defined in Appendix A-1, which also contains rules as to usage that shall be
applicable herein.

 

2.             The
Indenture Trustee, as Note Registrar, shall provide for the registration of the
Reset Rate Notes and of Transfers and exchanges of the Reset Rate Notes
pursuant to Section 2.4 of the Indenture.

 

3.             Each
class of Reset Rate Notes initially will be represented by registered notes of
such class in global form and shall be issued in the manner set forth in
Sections 2.1, 2.2 and 2.10 of the Indenture. 
Global Note Certificates representing interests in the Reset Rate Notes
may be reissued and represented by Reset Rate Notes of such class in definitive
form pursuant to Section 2.12 of the Indenture.

 

4.             During
any Reset Period when the Reset Rate Notes are denominated in a non-U.S. Dollar
currency, any Transfer of Reset Rate Notes made in violation of Section 2.1 of
the Indenture whereby a beneficial interest in either of the related Non-U.S.
Global Note Certificates is Transferred to any related U.S. Global Note
Certificate, or vice versa (other than on a Reset Date where such class is
being reset from being denominated in Foreign Exchange Mode, to U.S. Dollars),
shall be null and void and of no effect.

 

5.             Each
purchaser of a class of Reset Rate Notes that represent a beneficial interest
in a Global Note Certificate will be deemed to have represented and agreed, and
each purchaser of a Definitive Note will be required to certify in writing,
that:

 

(i)                                     (A)
the purchaser is a QIB and is acquiring such Reset Rate Notes for its own
account or as a fiduciary or agent for others (which others also must be QIBs),
for investment purposes and not for distribution in violation of the Act, and
it is able to bear the economic risk of an investment in the Reset Rate Notes
and has such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of purchasing the Reset Rate
Notes or (B) the purchaser is a non-U.S. Person (as defined in
Regulation S) outside the United States of America, acquiring the Reset
Rate Notes pursuant to an exemption from registration in accordance with
Rule 903 or Rule 904 of Regulation S;

 

(ii)                                  the
purchaser understands that the Reset Rate Notes are being offered only in a
transaction that does not require registration under the Act and, if such
purchaser decides to resell or otherwise Transfer such Reset Rate Notes, then
it agrees that it will resell or Transfer such Reset Rate Notes only
(A) so long as such Reset Rate Notes are eligible for resale pursuant to
Rule 144A, to a person whom the seller reasonably believes is a QIB acquiring
the Reset Rate Notes for its own account

 

A-3-1

 

or as a fiduciary or
agent for others (which others must also be QIBs) to whom notice is given that
the resale or other Transfer is being made in reliance on Rule 144A,
(B) pursuant to an effective registration statement under the Act,
(C) pursuant to an exemption from registration available under the Act
other than Rule 144A, or (D) to a purchaser who is a non-U.S. Person (as
defined in Regulation S) outside the United States of America, acquiring
the Reset Rate Notes pursuant to an exemption from registration under the Act
in accordance with Rule 903 or Rule 904 of Regulation S, in each case in
accordance with any applicable United States state securities or “blue sky”
laws or any securities laws of any other jurisdiction;

 

(iii)                               unless
the relevant legend set out below has been removed from the Reset Rate Notes
such purchaser shall notify each transferee of the Reset Rate Notes that (A)
such Reset Rate Notes have not been registered under the Act, (B) the holder of
such Reset Rate Notes is subject to the restrictions on the resale or other
Transfer thereof described in paragraph (ii) above, (C) such transferee shall
be deemed to have represented (1) as to its status as a QIB or a purchaser
acquiring the Reset Rate Notes in an offshore transaction pursuant to the
requirements of Regulation S, as the case may be, (2) if such transferee is a
QIB, that such transferee is acquiring the Reset Rate Notes for its own account
or as a fiduciary or agent for others (which others also must be QIBs) (or that
such transferee is acquiring such Reset Rate Notes in reliance on an exemption
under the Act other than Rule 144A or pursuant to an effective registration
statement under the Act), (3) if such transferee is a non-U.S. Person (as
defined in Regulation S) outside the United States of America, that such
transferee is acquiring the Reset Rate Notes pursuant to an exemption from
registration under the Act in accordance with the requirements of Rule 903 or
Rule 904 of Regulation S, (4) that such transferee is not an underwriter within
the meaning of Section 2(11) of the Act, and (5) that such transferee shall be
deemed to have agreed to notify its subsequent transferees as to the foregoing;

 

(iv)                              the
acquisition or purchase by an employee benefit plan or other retirement
arrangements (“Plan”) of a Reset Rate Note will not constitute or otherwise
result in:  (A) in the case of a
Plan subject to Section 406 of Employee Retirement Income Security Act of 1974,
as amended (“ERISA”) or Section 4975 of the Internal Revenue Code of 1986, as
amended (“Code”), a non-exempt prohibited transaction in violation of Section
406 of ERISA or Section 4975 of the Code which is not covered by a class or
other applicable exemption and (B) in the case of a Plan subject to a substantially
similar federal, state, local or foreign law (“Similar Law”), a non-exempt
violation of such substantially Similar Law.

 

6.             (A) By acceptance of a Reset Rate Note,
whether upon original issuance or subsequent Transfer, each Reset Rate
Noteholder or Note Owner, as applicable, of such Reset Rate Note (or a
beneficial interest therein) offered and sold only to a QIB in reliance on Rule
144A, acknowledges or is deemed to acknowledge, as the case may be, the
restrictions on the Transfer of such Reset Rate Notes and that the following
securities legend (the “Rule 144A Securities

 

A-3-2

 

Legend”) shall be affixed to each U.S. Rule
144A Global Note Certificate (as defined in Section 2.1 of the Indenture),
Non-U.S. Rule 144A Global Note Certificate (as defined in Section 2.1 of
the Indenture) and each Definitive Note representing an interest in either such
certificate (collectively, the “Rule 144A Certificates”) unless determined
otherwise in accordance with applicable law:

 

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), ANY UNITED
STATES STATE SECURITIES OR “BLUE SKY” LAWS OR ANY SECURITIES LAWS OF ANY OTHER
JURISDICTION, AND, AS A MATTER OF U.S. LAW, MAY NOT BE OFFERED OR SOLD IN
VIOLATION OF THE SECURITIES ACT OR SUCH OTHER LAWS.  THIS NOTE MAY BE TRANSFERRED ONLY IN MINIMUM DENOMINATIONS OF NOT
LESS THAN $250,000, £100,000, €100,000 OR THE APPLICABLE CURRENCY EQUIVALENT OF
$250,000, DEPENDING ON ITS CURRENCY OF DENOMINATION.  THE HOLDER HEREOF, BY PURCHASING OR ACCEPTING THIS NOTE IS HEREBY
DEEMED TO HAVE AGREED FOR THE BENEFIT OF THE TRUST AND THE INITIAL PURCHASERS
THAT IT WILL RESELL, PLEDGE OR OTHERWISE TRANSFER THIS NOTE, AS A MATTER OF
U.S. LAW, ONLY (A) (1) SO LONG AS THIS NOTE IS ELIGIBLE FOR RESALE, PURSUANT TO
RULE 144A PROMULGATED UNDER THE SECURITIES ACT (“RULE 144A”), TO A PERSON WHOM
THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, AS DEFINED
IN RULE 144A (A “QUALIFIED INSTITUTIONAL BUYER”), THAT IS ACQUIRING THIS NOTE
FOR ITS OWN ACCOUNT OR AS A FIDUCIARY OR AGENT FOR OTHERS (WHICH OTHERS MUST
ALSO BE QUALIFIED INSTITUTIONAL BUYERS) TO WHOM NOTICE IS GIVEN THAT THE RESALE
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, (2) PURSUANT TO AN
EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OTHER THAN RULE 144A, (3)
TO A PERSON WHO IS NOT A U.S. PERSON (AS DEFINED IN REGULATION S PROMULGATED
UNDER THE SECURITIES ACT) OUTSIDE THE UNITED STATES OF AMERICA ACQUIRING THIS
NOTE IN ACCORDANCE WITH RULE 903 OR RULE 904 OF REGULATION S PROMULGATED UNDER
THE SECURITIES ACT OR (4) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER
THE SECURITIES ACT, IN EACH CASE IN ACCORDANCE WITH ANY UNITED STATES STATE
SECURITIES OR “BLUE SKY” LAWS OR ANY SECURITIES LAWS OF ANY OTHER
JURISDICTION.  UPON ACQUISITION OR
TRANSFER OF A RESET RATE NOTE OR A BENEFICIAL INTEREST IN A RESET RATE NOTE, AS
THE CASE MAY BE, BY, FOR OR WITH THE ASSETS OF, AN EMPLOYEE BENEFIT PLAN OR
OTHER RETIREMENT ARRANGEMENT (A “PLAN”), SUCH RESET RATE NOTE OWNER SHALL BE
DEEMED TO HAVE REPRESENTED THAT SUCH ACQUISITION OR PURCHASE WILL NOT
CONSTITUTE OR OTHERWISE RESULT IN:  (I)
IN THE CASE OF A PLAN SUBJECT TO SECTION 406 OF EMPLOYEE RETIREMENT INCOME

 

A-3-3

 

SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), A NON-EXEMPT PROHIBITED
TRANSACTION IN VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE
WHICH IS NOT COVERED BY A CLASS OR OTHER APPLICABLE EXEMPTION AND (II) IN THE
CASE OF A PLAN SUBJECT TO A SUBSTANTIALLY SIMILAR FEDERAL, STATE, LOCAL OR
FOREIGN LAW (“SIMILAR LAW”), A NON-EXEMPT VIOLATION OF SUCH SUBSTANTIALLY
SIMILAR LAW.  ANY TRANSFER FOUND TO HAVE
BEEN MADE IN VIOLATION OF SUCH DEEMED REPRESENTATION SHALL BE NULL AND VOID AND
OF NO EFFECT.

 

THIS NOTE AND RELATED DOCUMENTATION MAY BE AMENDED OR SUPPLEMENTED FROM
TIME TO TIME TO MODIFY THE RESTRICTIONS ON AND PROCEDURES UNDERTAKEN OR
REPRESENTED BY THE HOLDER, FOR RESALES AND OTHER TRANSFERS OF THIS NOTE, TO
REFLECT ANY CHANGE IN APPLICABLE LAWS OR REGULATIONS (OR THE INTERPRETATION
THEREOF) OR IN PRACTICES RELATING TO RESALES OR OTHER TRANSFERS OF RESTRICTED
SECURITIES GENERALLY.  THE HOLDER OF
THIS NOTE AND ANY BENEFICIAL OWNER OF ANY INTEREST THEREIN SHALL BE DEEMED, BY
ITS ACCEPTANCE OR PURCHASE HEREOF, TO HAVE AGREED TO ANY SUCH AMENDMENT OR
SUPPLEMENT (EACH OF WHICH SHALL BE CONCLUSIVE AND BINDING ON THE HOLDER HEREOF
AND ALL FUTURE HOLDERS OF THIS NOTE AND ANY RESET RATE NOTES ISSUED IN EXCHANGE
OR SUBSTITUTION HEREFOR, WHETHER OR NOT ANY NOTATION THEREOF IS MADE HEREON)
AND AGREES TO TRANSFER THIS NOTE ONLY IN ACCORDANCE WITH ANY SUCH AMENDMENT OR
SUPPLEMENT IN ACCORDANCE WITH APPLICABLE LAW IN EFFECT AT THE DATE OF SUCH
TRANSFER.

 

(B) By acceptance of a Reset Rate Note, whether upon original issuance
or subsequent Transfer, each Reset Rate Noteholder or Note Owner, as
applicable, of a class of Reset Rate Notes (or a beneficial interest therein)
offered and sold only to a non-U.S. Person (as defined in Regulation S) outside
the United States of America in reliance on Regulation S acknowledges or is
deemed to acknowledge, as the case may be, the restrictions on the Transfer of
such Reset Rate Notes and that the following securities legend (the “Regulation
S Securities Legend” and with the Rule 144A Securities Legend, the “Securities
Legends” and each a “Securities Legend”) shall be affixed to each Regulation S
Global Note Certificate and each Definitive Note representing an interest in
such certificate (collectively, the “Regulation S Certificates”) unless
determined otherwise in accordance with applicable law:

 

THIS NOTE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), ANY UNITED
STATES STATE SECURITIES OR “BLUE SKY” LAWS OR ANY SECURITIES LAWS OF ANY OTHER

 

A-3-4

 

JURISDICTION,
AND, AS A MATTER OF U.S. LAW, PRIOR TO THE DATE THAT IS 40 DAYS AFTER THE LATER
OF THE COMMENCEMENT OF THE OFFERING OF THE RESET RATE NOTES AND THE CLOSING OF
THE OFFERING OF THE RESET RATE NOTES MAY NOT BE OFFERED, SOLD, PLEDGED OR
OTHERWISE TRANSFERRED IN THE UNITED STATES OF AMERICA OR TO A U.S. PERSON (AS
DEFINED IN REGULATION S PROMULGATED UNDER THE SECURITIES ACT) EXCEPT PURSUANT
TO AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT OR
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT, IN
EACH CASE IN ACCORDANCE WITH ANY UNITED STATES STATE SECURITIES OR “BLUE SKY”
LAWS OR ANY SECURITIES LAWS OF ANY OTHER JURISDICTION.  THIS NOTE MAY BE TRANSFERRED ONLY IN MINIMUM
DENOMINATIONS OF NOT LESS THAN $250,000, £100,000, €100,000 OR THE APPLICABLE
CURRENCY EQUIVALENT OF $250,000, DEPENDING ON ITS CURRENCY OF DENOMINATION.

 

UPON
ACQUISITION OR TRANSFER OF A RESET RATE NOTE OR A BENEFICIAL INTEREST IN A
RESET RATE NOTE, AS THE CASE MAY BE, BY, FOR OR WITH THE ASSETS OF, AN EMPLOYEE
BENEFIT PLAN OR OTHER RETIREMENT ARRANGEMENT (A “PLAN”), SUCH RESET RATE NOTE
OWNER SHALL BE DEEMED TO HAVE REPRESENTED THAT SUCH ACQUISITION OR PURCHASE
WILL NOT CONSTITUTE OR OTHERWISE RESULT IN: 
(I) IN THE CASE OF A PLAN SUBJECT TO SECTION 406 OF EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”) OR SECTION 4975 OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”), A NON-EXEMPT PROHIBITED
TRANSACTION IN VIOLATION OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE
WHICH IS NOT COVERED BY A CLASS OR OTHER APPLICABLE EXEMPTION AND (II) IN THE
CASE OF A PLAN SUBJECT TO A SUBSTANTIALLY SIMILAR FEDERAL, STATE, LOCAL OR
FOREIGN LAW (“SIMILAR LAW”), A NON-EXEMPT VIOLATION OF SUCH SUBSTANTIALLY
SIMILAR LAW.  ANY TRANSFER FOUND TO HAVE
BEEN MADE IN VIOLATION OF SUCH DEEMED REPRESENTATION SHALL BE NULL AND VOID AND
OF NO EFFECT.

 

Upon the
Transfer, exchange or replacement of a Rule 144A Certificate or a Regulation S
Certificate bearing the applicable legends set forth above, or upon specific request
for removal of the legends, the Trust or the Registrar will deliver only
replacement Rule 144A Certificates or Regulation S Certificates, as the case
may be, that bear such applicable legends, or will refuse to remove such
applicable legends, unless there is delivered to the Trust and the Registrar
such satisfactory evidence (which may include a legal opinion) as may
reasonably be required by the Trust and the Indenture Trustee that neither the
applicable legends nor the restrictions on Transfer set forth therein are
required to ensure compliance with the provisions of the Act.

 

A-3-5

 

Whenever a
Global Note Certificate is to be exchanged for Definitive Notes, such
Definitive Notes will be issued within five business days of delivery to the
Registrar of the information and any required certification described in the
preceding paragraph against the surrender of the relevant Global Note
Certificate at the specified office of the Registrar.  Such exchange shall be effected in accordance with the
regulations concerning the Transfer and registration from time to time relating
to the Reset Rate Notes and shall be effected without charge, but against such
indemnity as the Registrar may require in respect of any tax or other duty of
whatsoever nature which may be levied or imposed in connection with such
exchange.

 

Each Reset
Rate Noteholder or Note Owner, as applicable, of such Reset Rate Note, by its
acceptance of a Reset Rate Note or a beneficial interest therein, respectively,
also agrees that it will Transfer such Reset Rate Note or beneficial interest
therein, as the case may be, only as provided herein and in accordance with the
Indenture.  In addition, by acceptance of
any Reset Rate Note or beneficial interest therein, as applicable, each
proposed transferee thereof is hereby deemed to have agreed with the conditions
set forth in the applicable Securities Legend and agreed, by virtue of its
acceptance of such Reset Rate Note or beneficial interest therein, as the case
may be, to indemnify the Administrator, the Depositor, the Servicer, the
Indenture Trustee the Eligible Lender Trustee, the Remarketing Agents (in the
event such Transfer is made pursuant to a successful remarketing on a Reset
Date) and the Issuer against any and all liability that may result if such
Transfer is not made in a manner consistent with the restrictions set forth in
the Securities Legend.  In addition to
any applicable restrictions in the Indenture, with respect to the Transfer and
registration of Transfer of any Reset Rate Note registered in the name of a
Reset Rate Noteholder other than DTC or its nominee, or Euroclear or
Clearstream, Luxembourg or their joint nominee, as the case may be, to a
transferee that takes delivery in the form of a Definitive Note, in a
transaction other than pursuant to an effective registration statement under
the Act, the Indenture Trustee shall register the Transfer of such Definitive
Note if (i) (A) the requested Transfer is being made to a transferee who
has provided the Indenture Trustee and the Administrator with a Rule 144A
and Related Matters Certificate, substantially in the form attached as
Annex 1 hereto, (B) such transferee has provided comparable evidence
as to its QIB status, (C) such Transfer is being made in compliance with
Regulation S and such transferee has provided the Indenture Trustee and the
Administrator with a Regulation S and Related Matters Certificate,
substantially in the form attached as Annex 1 hereto, or (D) such Transfer
is being made in reliance on an exemption from registration under the Act other
than Rule 144A or Regulation S and that such transferor has provided the
Indenture Trustee and the Administrator with reasonably acceptable evidence
thereof, and (ii) the applicable transferor has provided the Indenture Trustee
and the Administrator with a Transferor Letter, substantially in the form of
Annex 2 hereto.

 

6.             Each class of Reset Rate Notes will be
issued only in minimum denominations of $250,000, or the applicable currency
equivalent of $250,000, €100,000, £100,000 or the applicable currency
equivalent of $250,000, depending on its currency of denomination, and integral
multiples of $1, €1, £1 or the applicable currency equivalent of $1, depending
on its currency of denomination, in excess thereof.  The Reset Rate Notes are exchangeable at any time into an equal
aggregate principal amount of Reset Rate Notes of the same class of different
authorized denominations pursuant to Section 2.4 of the Indenture.

 

A-3-6

 

7.             Reset Rate Notes may be presented or
surrendered pursuant to Section 2.4 of the Indenture.

 

8.             No service charge shall be made to a
Noteholder for any registration of Transfer or exchange of Reset Rate Notes,
but the Indenture Trustee may require payment of a sum sufficient to cover any
tax or other governmental charge pursuant to Section 2.4 of the Indenture.

 

9.             The Indenture Trustee shall cancel all
Reset Rate Notes surrendered for Transfer or exchange pursuant to Section 2.8
of the Indenture.

 

10.           For so long as any class of Reset Rate Notes
are “restricted securities” within the meaning of Rule 144(a)(3) of the Act,
(1) the Administrator will provide or cause to be provided to any holder of
such Reset Rate Notes and any prospective purchaser thereof designated by such
a holder, upon the request of such holder or prospective purchaser, the
information required to be provided to such holder or prospective purchaser by
Rule 144A(d)(4) under the Act; and (2) the Administrator shall update such
information from time to time in order to prevent such information from
becoming false and misleading and will take such other actions as are necessary
to ensure that the safe harbor exemption from the registration requirements of
the Act under Rule 144A is and will be available for resales of such Reset Rate
Notes conducted in accordance with Rule 144A.

 

A-3-7

 

ANNEX 1 TO 

APPENDIX A-3

 

FORM OF RULE 144A AND RELATED MATTERS CERTIFICATE

 

[Date]

 

[SELLER]

 

Deutsche Bank Trust Company

Americas, as Indenture Trustee

60 Wall Street, 26th Floor,

Mailstop NYC60-2606

New York, New
York 10005

 

Sallie Mae,
Inc., as Administrator

11600 Sallie Mae Drive

Reston, Virginia 20193

 

Re:                                                       SLM
Student Loan Trust 2004-8, Student Loan-Backed,

Class A-5 and Class A-6 Reset Rate Notes (the “Reset Rate Notes”)

 

Dear Sirs:

 

In connection with our purchase of the Class
[A-5] [A-6] Reset Rate Notes of the above-referenced series, the undersigned
certifies to each of the parties to whom this letter is addressed that it is a
qualified institutional buyer (as defined in Rule 144A under the Securities Act
of 1933, as amended (the “Act”)) as follows:

 

(A)          It owned and/or invested
on a discretionary basis eligible securities (excluding affiliate’s securities,
bank deposit notes and CD’s, loan participations, repurchase agreements,
securities owned but subject to a repurchase agreement and swaps), as described
below:

 

Date:
                    ,
20    (must be on or after the close of its most recent fiscal
year)

 

Amount:
$                         ;
and

 

(B)           The dollar amount set
forth above is:

 

	
   

  	
  1.

  	
  greater than
  $100 million and the undersigned is one of the following entities:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  an insurance
  company as defined in Section 2(13) of the Act; or

  

 

A-3-8

 

	
   

  	
   

  	
   

  	
   

  	
  an
  investment company registered under the Investment Company Act or any
  business development company as defined in Section 2(a)(48) of the Investment
  Company Act of 1940; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  a Small
  Business Investment Company licensed by the U.S. Small Business
  Administration under Section 301 (c) or (d) of the Small Business Investment
  Act of 1958; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  a plan (i)
  established and maintained by a state, its political subdivisions, or any
  agency or instrumentality of a state or its political subdivisions, the laws
  of which permit the purchase of securities of this type, for the benefit of
  its employees and (ii) the governing investment guidelines of which permit
  the purchase of securities of this type; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  a business
  development company as defined in Section 202(a)(22) of the Investment
  Advisers Act of 1940; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  a
  corporation (other than a U.S. bank, savings and loan association or
  equivalent foreign institution), partnership, Massachusetts or similar
  business trust, or an organization described in Section 501(c)(3) of the
  Internal Revenue Code; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  a U.S. bank,
  savings and loan association or equivalent foreign institution, which has an
  audited net worth of at least $25 million as demonstrated in its latest
  annual financial statements; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  an
  investment adviser registered under the Investment Advisers Act; or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  2.

  	
  greater than
  $10 million, and the undersigned is a broker-dealer registered with the SEC;
  or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  3.

  	
  less than
  $10 million, and the undersigned is a broker-dealer registered with the SEC
  and will only purchase Rule 144A securities in transactions in which it acts
  as a riskless principal (as defined in Rule 144A); or

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  4.

  	
  less than
  $100 million, and the undersigned is an investment company registered under
  the Investment Company Act of 1940, which, together with one or more
  registered investment companies having the same or an affiliated investment
  adviser, owns at least $100 million of eligible securities; or

  

 

A-3-9

 

	
   

  	
  5.

  	
  less than
  $100 million, and the undersigned is an entity, all the equity owners of
  which are qualified institutional buyers.

  

 

The undersigned further certifies that it is
purchasing the Reset Rate Notes for its own account or for the account of
others that independently qualify as “Qualified Institutional Buyers” as
defined in Rule 144A (a “QIB”). It is aware that the sale of the Reset Rate
Notes is being made in reliance on its continued compliance with Rule 144A. It
is aware that the transferor may rely on the exemption from the provisions of
Section 5 of the Act provided by Rule 144A. The undersigned understands that
the Reset Rate Notes may be Transferred only (A) so long as such Reset
Rate Notes are eligible for resale pursuant to Rule 144A, to a person whom the
seller reasonably believes is a QIB acquiring the Reset Rate Notes for its own
account or as a fiduciary or agent for others (which others must also be QIBs)
to whom notice is given that the Transfer is being made in reliance on Rule
144A, (B) pursuant to an effective registration statement under the Act,
(C) pursuant to an exemption from registration available under the Act other
than Rule 144A, or (D) to a purchaser who is a non-U.S. Person (as defined in
Regulation S) outside the United States of America, acquiring the Reset
Rate Notes pursuant to an exemption from registration under the Act in
accordance with Rule 903 or Rule 904 of Regulation S, in each case in
accordance with any applicable United States state securities or “blue sky”
laws or any securities laws of any other jurisdiction.

 

The undersigned agrees that if at some future
time it wishes to dispose of or exchange any of the Reset Rate Notes, it will
not Transfer or exchange any of the Reset Rate Notes unless: (1) the sale is to
an Eligible Purchaser (as defined below), (2) all offers or solicitations in
connection with the sale, whether directly or through any agent acting on our
behalf, are limited only to Eligible Purchasers and are not made by means of
any form of general solicitation or general advertising whatsoever, and (3)
such transferee shall deliver a Rule 144A and Related Matters Certificate to
substantially the same effect as this letter to the addressees hereof or a
Regulation S and Related Matters Certificate substantially in the same form as
set forth in Annex 1 to Appendix 3 to the Indenture, or such other evidence as
may be reasonably acceptable to the Administrator.

 

The undersigned hereby represents and
warrants that the undersigned is accepting ownership of the Reset Rate Notes in
compliance with the restrictions set forth in Section 5 of Appendix A-3
to the Indenture, dated as of August 1, 2004 (the “Indenture”), among the
Trust, Chase Manhattan Bank USA, National Association, as eligible lender
trustee, and Deutsche Bank Trust Company Americas, as indenture trustee, and
acknowledges that the Reset Rate Notes will be issued with the legends set forth
in Section 6 of Appendix A-3 to the Indenture.

 

“Eligible Purchaser” means a
corporation, partnership or other entity which we have reasonable grounds to
believe and do believe (A) (i) can make representations with respect to
itself to substantially the same effect as the representations set forth
herein, and (ii) is a QIB as defined under Rule 144A of the Act or any entity
in which all of the equity owners come within such paragraphs, (B) can make
representations with respect to itself to substantially the same effect as the
representations set forth in the Regulation S and Related Matters Certificate
in the same form as Annex 1 to Appendix 3 to the Indenture, or (C) (i) can
make representations with respect to itself substantially to the same effect as
the representations set forth herein (other than to its status as a QIB), and
(ii) is acquiring such Reset Rate Notes in reliance on an exemption to

 

A-3-10

 

the Act other
than Rule 144A in accordance with any applicable United States state securities
or “Blue Sky” laws.

 

If the Purchaser proposes that its Reset Rate
Notes be registered in the name of a nominee on its behalf, the Purchaser has
identified such nominee below, and has caused such nominee to complete the
Nominee Acknowledgment at the end of this letter.

 

Name of
Nominee (if any):
                                    

 

IN WITNESS WHEREOF, this document has been
executed by the undersigned who is duly authorized to do so on behalf of the
undersigned Qualified Institutional Buyer on the
        day of
                     ,
20    .

 

	
   

  	
  Name of Institution

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title

  

 

 

Nominee
Acknowledgment

 

The undersigned hereby acknowledges and
agrees that as to the Reset Rate Notes being registered in its name, the sole
beneficial owner thereof is and shall be the Purchaser identified above, for
whom the undersigned is acting as nominee.

 

	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  Duly Authorized

  

 

A-3-11

 

FORM OF REGULATION S AND RELATED MATTERS
CERTIFICATE

 

[Date]

 

[SELLER]

 

Deutsche Bank Trust Company

Americas, as Indenture Trustee

60 Wall Street, 26th Floor,

Mailstop NYC60-2606

New York, New
York  10005

 

Sallie Mae,
Inc., as Administrator

11600 Sallie Mae Drive

Reston, Virginia 20193

 

Re:                                                       SLM
Student Loan Trust 2004-8, Student Loan-Backed,

Class A-5 and Class A-6 Reset Rate Notes (the “Reset Rate Notes”)

 

Dear Sirs:

 

In connection with our purchase of the Class
[A-5] [A-6] Reset Rate Notes of the above-referenced series, the undersigned
certifies to each of the parties to whom this letter is addressed that it is a
non-U.S. person (as defined in Regulation S) outside the United States of
America, acquiring the Reset Rate Notes pursuant to an exemption from
registration in accordance with Rule 903 or Rule 904 of Regulation S.

 

The undersigned further certifies that it is
purchasing the Reset Rate Notes for its own account or for the account of
others that independently qualify as non-U.S. persons (as defined in Regulation
S) outside the United States of America. 
It is aware that the sale of the Reset Rate Notes is being made in
reliance on its continued compliance with Rule 903 or Rule 904 of Regulation S.  The undersigned understands that the Reset
Rate Notes may resold or Transferred only (A) so long as such Reset Rate
Notes are eligible for resale pursuant to Rule 144A, to a person whom the
seller reasonably believes is a QIB acquiring the Reset Rate Notes for its own
account or as a fiduciary or agent for others (which others must also be QIBs)
to whom notice is given that the resale or other Transfer is being made in
reliance on Rule 144A, (B) pursuant to an effective registration statement
under the Act, (C) pursuant to another exemption from registration
available under the Act other than Rule 144A, or (D) to a purchaser who is a
non-U.S. Person (as defined in Regulation S) outside the United States of
America, acquiring the Reset Rate Notes pursuant to an exemption from
registration under the Act in accordance with Rule 903 or Rule 904 of
Regulation S, in each case in accordance with any applicable United States
state securities or “blue sky” laws or any securities laws of any other
jurisdiction.

 

A-3-12

 

The undersigned agrees that if at some future
time it wishes to dispose of or exchange any of the Reset Rate Notes, it will
not Transfer or exchange any of the Reset Rate Notes unless: (1) the sale is to
an Eligible Purchaser (as defined below), (2) all offers or solicitations in
connection with the sale, whether directly or through any agent acting on our
behalf, are limited only to Eligible Purchasers and are not made by means of
any form of general solicitation or general advertising whatsoever, and (3) such
transferee shall deliver a Rule 144A Certificate substantially in the same form
as Annex 1 to Appendix 3 to the Indenture, or a Regulation S Certificate to
substantially the same effect as this letter to the addressees hereof or such
other evidence as may be reasonably acceptable to the Administrator and the
Indenture Trustee.

 

The undersigned hereby represents and
warrants that the undersigned is accepting ownership of the Reset Rate Notes in
compliance with the restrictions set forth in Section 5 of Appendix A-3
to the Indenture, dated as of August 1, 2004 (the “Indenture”), among the
Trust, Chase Manhattan Bank USA, National Association, as eligible lender
trustee, and Deutsche Bank Trust Company Americas, as indenture trustee, and
acknowledges that the Reset Rate Notes will be issued with the legends set
forth in Section 5 to Appendix A-3 to the Indenture.

 

“Eligible Purchaser” means a
corporation, partnership or other entity which we have reasonable grounds to
believe and do believe (A) (i) can make representations with respect to
itself to substantially the same effect as the representations set forth
herein, and (ii) is a QIB as defined under Rule 144A of the Act or any entity
in which all of the equity owners come within such paragraphs, (B) (i) can make
representions with respect to itself to substantially the same effect as the
representations set forth in the Regulation S Certificate in the same form as
Annex 1 to Appendix 3 to the Indenture, and (ii) is acquiring such Reset Rate
Notes pursuant to an exemption from registration in accordance with Rule 903 or
Rule 904 of Regulation S, or (C) (i) can make representations with respect
to itself substantially to the same effect as the representations set forth
herein (other than to its status as a QIB), and (ii) is acquiring such
Reset Rate Notes in reliance on an exemption to the Act other than Rule 144A in
accordance with any applicable United States state securities or “Blue Sky”
laws.

 

If the Purchaser proposes that its Reset Rate
Notes be registered in the name of a nominee on its behalf, the Purchaser has
identified such nominee below, and has caused such nominee to complete the
Nominee Acknowledgment at the end of this letter.

 

Name of
Nominee (if any):
                               

 

A-3-13

 

IN WITNESS WHEREOF, this document has been
executed by the undersigned who is duly authorized to do so on behalf of the
undersigned non-U.S. person on the        day of
                     ,
20   .

 

	
   

  	
  Name of Institution

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Signature

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Name

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Title

  

 

 

Nominee
Acknowledgment

 

The undersigned hereby acknowledges and
agrees that as to the Reset Rate Notes being registered in its name, the sole
beneficial owner thereof is and shall be the Purchaser identified above, for
whom the undersigned is acting as nominee.

 

	
   

  	
  By:

  
	
   

  	
   

  
	
   

  	
  Duly Authorized

  

 

A-3-14

 

ANNEX 2 TO

APPENDIX A-3

 

FORM OF TRANSFEROR LETTER

 

[Date]

 

Deutsche Bank Trust Company

Americas, as Indenture Trustee

60 Wall Street, 26th Floor,

Mailstop NYC60-2606

New York, New
York  10005

 

Sallie Mae,
Inc., as Administrator

11600 Sallie Mae Drive

Reston, Virginia 20193

 

Re:                                                       SLM
Student Loan Trust 2004-8, Student Loan-Backed, 

Class A-5 and Class A-6 Reset Rate Notes (the “Reset Rate Notes”)

 

Ladies and
Gentlemen:

 

In connection
with our disposition of the Class [A-5] [A-6] Reset Rate Notes of the
above-referenced series owned by us, we certify that (a) we understand that the
Reset Rate Notes have not been registered under the Securities Act of 1933, as
amended (the “Act”), and are being disposed by us in a transaction that is
exempt from the registration requirements of the Act, and (b) we have not
offered or sold any Reset Rate Notes to, or solicited offers to buy any Reset
Rate Notes from, any person, or otherwise approached or negotiated with any
person with respect thereto, in a manner that would be deemed, or taken any
other action would result in, a violation of Section 5 of the Act.

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Print Name of Transferor

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Authorized Officer

  
				

 

A-3-15

 

SCHEDULE A

 

Schedule of Trust Student Loans

 

[See Schedule A to the Bill of
Sale

 

(Attachment C to the Sale
Agreement)]

 

A-1

 

SCHEDULE
B

 

Location of Trust
Student Loan Files

 

[See Attachment B to the
Servicing Agreement)]

 

B-1

 

EXHIBIT
A

 

[Form of Notes]

 

(See tabs 15.1
through 16.1)

 

A-1

 

EXHIBIT B

 

[Form of Note
Depository Agreement

for U.S. Dollar Denominated Notes]

 

B-1

 

EXHIBIT C

 

[Form of Note
Depository Agreement for Notes

Denominated in a Currency Other than U.S. Dollar]

 

C-1Exhibit
10.1

 

RESTORATION HARDWARE, INC.

NOTICE OF GRANT OF STOCK OPTION

 

Notice is hereby given of
the following option grant (the “Option”) to purchase shares of Common Stock of
Restoration Hardware, Inc. (the “Corporation”):

 

	
  Optionee:

  	
   

  	
  Stephen J. Gordon

  
	
   

  	
   

  	
   

  
	
  Grant Date:

  	
   

  	
  May 24, 2004

  
	
   

  	
   

  	
   

  
	
  Vesting Commencement
  Date:

  	
   

  	
  May 24, 2004

  
	
   

  	
   

  	
   

  
	
  Exercise Price:

  	
   

  	
  $7.00

  
	
   

  	
   

  	
   

  
	
  Number of Option
  Shares:

  	
   

  	
  107,145

  
	
   

  	
   

  	
   

  
	
  Expiration Date:

  	
   

  	
  May 23, 2014

  
	
   

  	
   

  	
   

  
	
  Type of Option:

  	
   

  	
  Non-Statutory Option

  

 

Exercise Schedule:  The Option shall become exercisable for
one-third (1/3) of the Option Shares upon Optionee’s completion of each of the
three (3) years of Service measured from and after the Vesting
Commencement Date, with the first such installment to become exercisable on the
first anniversary of the Vesting Commencement Date.  In no event shall the Option become exercisable for any
additional Option Shares after Optionee’s cessation of Service.

 

Optionee understands and
agrees that the Option is granted subject to and in accordance with the terms
of the Restoration Hardware, Inc. 1998 Stock Incentive Plan Amended and
Restated on October 9, 2002 (the “Plan”). 
Optionee further agrees to be bound by the terms of the Plan and the
terms of the Option as set forth in the Stock Option Agreement attached hereto
as Exhibit A.  A copy of the
Plan is available upon request made to the Secretary of the Corporation at the
Corporation’s principal offices.

 

No Employment or Service
Contract.  Nothing in
this notice or in the attached Stock Option Agreement or in the Plan shall
confer upon Optionee any right to continue in Service for any period of
specific duration or interfere with or otherwise restrict in any way the rights
of the Corporation (or any Parent or Subsidiary employing or retaining Optionee)
or of Optionee, which rights are hereby expressly reserved by each, to
terminate Optionee’s Service at any time for any reason, with or without cause.

 

 

Definitions.  All capitalized terms in this notice shall
have the meaning assigned to them in this notice or in the attached Stock
Option Agreement.

 

DATED: May 24, 2004

 

 

	
   

  	
  RESTORATION HARDWARE, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Gary Friedman

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  President and
  Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  /s/
  S. J. Gordon

  
	
   

  	
   

  
	
   

  	
  Optionee

  
	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
					

 

ATTACHMENTS

Exhibit A - Stock Option Agreement

 

 

RESTORATION HARDWARE, INC.

STOCK OPTION AGREEMENT

 

RECITALS

 

A.           The Board has adopted
the Plan for the purpose of retaining the services of selected Employees,
non-employee members of the Board or of the board of directors of any Parent or
Subsidiary and consultants and other independent advisors who provide services
to the Corporation (or any Parent or Subsidiary).

 

B.             Optionee is to render
valuable services to the Corporation (or a Parent or Subsidiary), and this
Agreement is executed pursuant to, and is intended to carry out the purposes
of, the Plan in connection with the Corporation’s grant of an option to
Optionee.

 

C.             All capitalized terms
in this Agreement shall have the meaning assigned to them in the attached
Appendix.

 

NOW, THEREFORE, it is hereby agreed as
follows:

 

1.               Grant of
Option.  The Corporation
hereby grants to Optionee, as of the Grant Date, an option to purchase up to
the number of Option Shares specified in the Grant Notice.  The Option Shares shall be purchasable from
time to time during the option term specified in Paragraph 2 below at the
Exercise Price.

 

2.               Option
Term.  This option shall
have a maximum term of ten (10) years measured from the Grant Date and
shall accordingly expire at the close of business on the Expiration Date,
unless sooner terminated in accordance with Paragraph 5 or 6 below.

 

3.               Limited
Transferability.  This
option shall be neither transferable nor assignable by Optionee other than by
will or by the laws of descent and distribution following Optionee’s death and
may be exercised, during Optionee’s lifetime, only by Optionee.  However, if this option is designated a
Non-Statutory Option in the Grant Notice, then this option may, in connection
with the Optionee’s estate plan, be assigned in whole or in part during
Optionee’s lifetime to one or more members of the Optionee’s immediate family
or to a trust established for the exclusive benefit of the Optionee and/or one
or more such family members.  The
assigned portion shall be exercisable only by the person or persons who acquire
a proprietary interest in the option pursuant to such assignment.  The terms applicable to the assigned portion
shall be the same as those in effect for this option immediately prior to such
assignment.

 

4.               Date of
Exercise.  This option
shall become exercisable for the Option Shares in one or more installments as
specified in the Grant Notice.  As the
option becomes exercisable for such installments, those installments shall
accumulate and the option shall remain exercisable for the accumulated
installments until the Expiration Date or sooner termination of the option term
under Paragraph 5 or 6 below.

 

 

5.               Cessation
of Service.  The option
term specified in Paragraph 2 above shall terminate (and this option shall
cease to be outstanding) prior to the Expiration Date should any of the
following provisions become applicable:

 

(a)  Should Optionee cease to remain in Service
for any reason (other than death, Permanent Disability or Cause) while this
option is outstanding, then the period for exercising this option shall be
reduced to a three (3)-month period commencing with the date of such
cessation of Service, but in no event shall this option be exercisable at any
time after the Expiration Date.

 

(b)  Should Optionee die while holding this
option, then the personal representative of Optionee’s estate or the person or
persons to whom the option is transferred pursuant to Optionee’s will or in
accordance with the laws of inheritance shall have the right to exercise this
option.  Such right shall lapse, and
this option shall cease to be outstanding, upon the earlier of
(i) the expiration of the twelve (12)-month period measured from the
date of Optionee’s death or (ii) the Expiration Date.

 

(c)  Should Optionee cease Service by reason of
Permanent Disability while this option is outstanding, then the period for
exercising this option shall be reduced to a twelve (12)-month period
commencing with the date of such cessation of Service, but in no event shall
this option be exercisable at any time after the Expiration Date.

 

(d)  During the limited period of post-Service
exercisability, this option may not be exercised in the aggregate for more than
the number of vested Option Shares for which the option is exercisable at the
time of Optionee’s cessation of Service. 
Upon the expiration of such limited exercise period or (if earlier) upon
the Expiration Date, this option shall terminate and cease to be outstanding for
any otherwise exercisable Option Shares for which the option has not been
exercised.  However, this option shall,
immediately upon Optionee’s cessation of Service for any reason, terminate and
cease to be outstanding with respect to any Option Shares for which this option
is not otherwise at that time exercisable.

 

(e)  Should Optionee’s Service be terminated for
Cause, then this option shall terminate immediately and cease to remain
outstanding.

 

6.               Special Acceleration of Option.

 

(a)  This option to the extent outstanding at the
time of a Change in Control transaction but not otherwise fully exercisable,
shall automatically accelerate so that this option shall, immediately prior to
the effective date of such Change in Control, become exercisable for all of the
Option Shares at the time subject to this option and may be exercised for any
or all of those Option Shares as fully vested shares of Common Stock.  However, this option shall not become
exercisable on such an accelerated basis if and to the extent:  (i) this option is, in connection with
the Change in Control, to be assumed by the successor corporation (or parent
thereof) or otherwise continued in full

 

2

 

force and effect pursuant
to the terms of the Change in Control transaction; or (ii) this option is
to be replaced with a cash incentive program of the successor corporation which
preserves the spread existing at the time of the Change in Control on the
Option Shares for which this option is not otherwise at that time exercisable
(the excess of the Fair Market Value of those Option Shares over the aggregate
Exercise Price payable for such shares) and provides for subsequent payout in
accordance with the same option exercise/vesting schedule set forth in the
Grant Notice.

 

(b)  Immediately following the Change in Control,
this option shall terminate and cease to be outstanding, except to the extent
assumed by the successor corporation (or parent thereof) or otherwise continued
in full force and effect pursuant to the terms of the Change in Control
transaction.

 

(c)  If this option is assumed in connection with
a Change in Control (or otherwise continued in full force and effect), then
this option shall be appropriately adjusted, immediately after such Change in
Control, to apply to the number and class of securities or other property which
would have been issuable to Optionee in consummation of such Change in Control
had the option been exercised immediately prior to such Change in Control, and
appropriate adjustments shall also be made to the Exercise Price, provided
the aggregate Exercise Price shall remain the same.

 

(d)  Termination
of Service Not for Cause or Termination for Good Reason.  In the event the Optionee’s Service is
terminated (i) by the Corporation Not for Cause or (ii) by the Optionee for
Good Reason, this option automatically shall become vested and exercisable
immediately prior to such termination of Service for all of the Option Shares
at the time represented by this option. 
The Optionee’s termination shall be for “Good Reason” if the Optionee
provides written notice to the Chief Executive Officer of the Corporation and
the Board of the Good Reason within thirty (30) days of the event constituting
Good Reason and provides the Corporation with a period of twenty (20) days to
cure the event constituting Good Reason and the Corporation fails to cure the
Good Reason within that period.  For
purposes of this Agreement, “Good Reason” shall mean either (x) a material
reduction in the Optionee’s base salary, or (y) a relocation of the Optionee’s
place of employment by more than fifty (50) miles, provided and only if such
change, reduction or relocation is effected by the Corporation without the
Optionee’s consent.  Notwithstanding the
foregoing, in order to avoid the payment of excise tax imposed by Section 4999
of the Code, the Corporation may, in accordance with Section 3(b) of the
Employment Agreement entered into between the Optionee and Corporation, dated
as of May 24, 2004, reduce the payments or benefits to the Optionee (within the
meaning of Section 280G(b)(2) of the Code). 
Such reduction may apply to cash payments, vesting acceleration pursuant
to this Section 6(d) and other benefits received by the Optionee which could
result in the acceleration of vesting of only a portion or none of then
unvested Option Shares.

 

(e)  This Agreement shall not in any way affect
the right of the Corporation to adjust, reclassify, reorganize or otherwise
change its capital or business

 

3

 

structure or to merge,
consolidate, dissolve, liquidate or sell or transfer all or any part of its
business or assets.

 

7.               Adjustment
in Option Shares.

 

Should any change be made
to Common Stock by reason of any stock split, stock dividend, recapitalization,
combination of shares, exchange of shares or other change affecting the
outstanding Common Stock as a class without the Corporation’s receipt of
consideration, appropriate adjustments shall be made to (i) the total
number and/or class of securities subject to this option and (ii) the
Exercise Price in order to reflect such change and thereby preclude a dilution
or enlargement of benefits hereunder.

 

8.               Stockholder
Rights.  The holder of
this option shall not have any stockholder rights with respect to the Option
Shares until such person shall have exercised the option, paid the Exercise
Price and become a holder of record of the purchased shares.

 

9.               Manner of
Exercising Option.

 

(a)  In order to exercise this option with
respect to all or any part of the Option Shares for which this option is at the
time exercisable, Optionee (or any other person or persons exercising the
option) must take the following actions:

 

(i)                                     Execute
and deliver to the Corporation a Notice of Exercise for the Option Shares for
which the option is exercised;

 

(ii)                                  Pay
the aggregate Exercise Price for the purchased shares in one or more of the
following forms, subject to Applicable Laws:

 

(A) Cash or check made
payable to the Corporation; or

 

(B) Shares of Common
Stock held by Optionee (or any other person or persons exercising the option)
for the requisite period necessary to avoid a charge to the Corporation’s
earnings for financial reporting purposes and valued at their Fair Market Value
on the Exercise Date; or

 

(C) Through a special sale
and remittance procedure pursuant to which Optionee (or any other person or
persons exercising the option) shall concurrently provide irrevocable
instructions (I) to a Corporation-designated brokerage firm to effect the
immediate sale of the purchased shares and remit to the Corporation, out of the
sale proceeds available on the settlement date, sufficient funds to cover the
aggregate Exercise Price payable for the purchased shares plus all applicable
federal, state and local income and employment taxes required to be withheld by
the Corporation by reason of such exercise and (II) to the Corporation to
deliver the certificates for the purchased shares directly to such brokerage
firm in order to complete the sale.

 

4

 

Except to the extent the
sale and remittance procedure is utilized in connection with the option
exercise, payment of the Exercise Price must accompany the Notice of Exercise
delivered to the Corporation in connection with the option exercise;

 

(iii)                               Furnish
to the Corporation appropriate documentation that the person or persons
exercising the option (if other than Optionee) have the right to exercise this
option; and

 

(iv)                              Make
appropriate arrangements with the Corporation (or Parent or Subsidiary
employing or retaining Optionee) for the satisfaction of all federal, state and
local income and employment tax withholding requirements applicable to the
option exercise.

 

(b)  As soon as practical after the Exercise
Date, the Corporation shall issue to or on behalf of Optionee (or any other
person or persons exercising this option) a certificate for the purchased
Option Shares, with the appropriate legends, if any, affixed thereto.

 

(c)  In no event may this option be exercised for
any fractional shares of Common Stock.

 

10.         Compliance with Laws and Regulations.

 

(a)  The exercise of this option and the issuance
of the Option Shares upon such exercise shall be subject to compliance by the
Corporation and Optionee with all applicable requirements of law relating
thereto and with all applicable regulations of any stock exchange (or the
Nasdaq National Market, if applicable) on which Common Stock may be listed for
trading at the time of such exercise and issuance.

 

(b)  The inability of the Corporation to obtain
approval from any regulatory body having authority deemed by the Corporation to
be necessary to the lawful issuance and sale of any Common Stock pursuant to
this option shall relieve the Corporation of any liability with respect to the
non-issuance or sale of Common Stock as to which such approval shall not have
been obtained.  The Corporation,
however, shall use its best efforts to obtain all such approvals.

 

11.         Successors and Assigns.  Except to the extent otherwise provided in
Paragraphs 3 and 6 above, the provisions of this Agreement shall inure to
the benefit of, and be binding upon, the Corporation and its successors and
assigns and Optionee, Optionee’s assigns and the legal representatives, heirs
and legatees of Optionee’s estate.

 

12.         Notices.  Any notice required to be given or delivered
to the Corporation under the terms of this Agreement shall be in writing and
addressed to the Corporation at its principal corporate offices.  Any notice required to be given or delivered
to Optionee shall be in writing and addressed to Optionee at the address
indicated below Optionee’s signature line on the Grant Notice.  All notices shall be

 

5

 

deemed effective upon
personal delivery or upon deposit in the U.S. mail, postage prepaid and
properly addressed to the party to be notified.

 

13.         Construction.  This Agreement and the option evidenced
hereby are made and granted pursuant to the Plan and are in all respects
limited by and subject to the terms of the Plan.  All decisions of the Plan Administrator with respect to any
question or issue arising under the Plan or this Agreement shall be conclusive
and binding on all persons having an interest in this option.  For purposes of this Agreement, whenever the
context requires, the singular number shall include the plural, and vice versa.

 

14.         Governing Law.  The interpretation, performance and
enforcement of this Agreement shall be governed by the laws of the State of
California without resort to that State’s conflict-of-laws rules.

 

15.         Excess Shares.  If the Option Shares covered by this
Agreement exceed, as of the Grant Date, the number of shares of Common Stock
which may without stockholder approval be issued under the Plan, then this
option shall be void with respect to those excess shares, unless stockholder
approval of an amendment sufficiently increasing the number of shares of Common
Stock issuable under the Plan is obtained in accordance with the provisions of
the Plan.

 

END OF AGREEMENT

 

6

 

EXHIBIT
I

NOTICE OF EXERCISE

 

I hereby notify
Restoration Hardware, Inc. (the “Corporation”) that I elect to purchase
                        
shares of the Corporation’s common stock (the “Purchased Shares”) at the option
exercise price of
$                      
per share (the “Exercise Price”) pursuant to that certain option (the “Option”)
granted to me on                           ,
2004 under the Corporation’s 1998 Stock Incentive Plan Amended and Restated on
October 9, 2002.

 

Concurrently with the
delivery of this Exercise Notice to the Corporation, I shall hereby pay to the
Corporation the Exercise Price for the Purchased Shares in accordance with the
provisions of my agreement with the Corporation (or other documents) evidencing
the Option and shall deliver whatever additional documents may be required by
such agreement as a condition for exercise. 
Alternatively, I may utilize the special broker-dealer sale and
remittance procedure specified in my agreement to effect payment of the
Exercise Price.

 

                                          ,
20    

Date

 

	
   

  	
   

  
	
   

  	
  Optionee

  
	
   

  	
   

  
	
   

  	
  Address:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Print name in exact
  manner

  it is to appear on the

  stock certificate:

  	
   

  
	
   

  	
   

  
	
  Address to which
  certificate

  is to be sent, if different

  from address above:

  	
   

  
	
   

  	
   

  
	
  Social Security Number:

  	
   

  
	
  Employee Number:

  	
   

  

 

 

APPENDIX

 

The following definitions
shall be in effect under the Agreement:

 

A.                                   Agreement
shall mean this Stock Option Agreement.

 

B.                                     Applicable
Laws shall mean the legal requirements relating to the
administration of stock option plans, if any, under applicable provisions of
federal securities laws, state corporate and securities laws, the Code, the
rules of any applicable stock exchange or national market system, and the rules
of any foreign jurisdiction applicable to the granting of stock options and the
issuance of shares of Common Stock to residents therein.

 

C.                                     Board
shall mean the Corporation’s Board of Directors.

 

D.                                    Cause
shall mean that the Optionee has been convicted of a felony involving fraud or
dishonesty, or the termination is evidenced by a resolution adopted in good
faith by a majority of the Board to the effect that the Optionee (i)
intentionally and continually failed substantially to perform his reasonably
assigned duties with the Corporation, which failure continued for a period of
at least thirty (30) days after a written notice of demand for substantial
performance has been delivered to the Optionee specifying the manner in which
the Optionee has failed substantially to perform, or (ii) intentionally engaged
in conduct which is demonstrably and materially injurious to the Corporation;
provided, that no termination of the Optionee’s employment shall be for Cause
as set forth in clause (ii) above until there shall have been delivered to the
Optionee a copy of a written notice setting forth the conduct set forth in
clause (ii) and specifying the particulars thereof in detail.  No act, nor failure to act, shall be
considered “intentional” unless the Optionee has acted, or failed to act, with
a lack of good faith and with a lack of reasonable belief that the Optionee’s
action or failure to act was in the best interest of the Corporation.

 

E.                                      Change in
Control shall mean a change in ownership or control of the
Corporation effected through any of the following transactions:

 

(i)                                     A
merger or consolidation in which securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation’s outstanding
securities are transferred to a person or persons different from the persons
holding those securities immediately prior to such transaction; or

 

(ii)                                  The
sale, transfer or other disposition of all or substantially all of the
Corporation’s assets in complete liquidation or dissolution of the Corporation;
or

 

(iii)                               The
acquisition, directly or indirectly, by any person or related group of persons
(other than the Corporation or a person that directly or indirectly controls,
is controlled by, or is under common control with, the Corporation) of
beneficial ownership (within the meaning of Rule 13d-3 of the 1934 Act) of
securities possessing

 

A-1

 

more than fifty percent
(50%) of the total combined voting power of the Corporation’s outstanding
securities pursuant to a tender or exchange offer made directly to the
Corporation’s stockholders; or

 

(iv)                              A
change in the composition of the Board over a period of thirty-six (36)
consecutive months or less such that a majority of the Board members ceases, by
reason of one or more contested elections for Board membership, to be comprised
of individuals who either (A) have been Board members continuously since
the beginning of such period or (B) have been elected or nominated for
election as Board members during such period by at least a majority of the
Board members described in clause (A) who were still in office at the time
the Board approved such election or nomination.

 

F.                                      Code
shall mean the Internal Revenue Code of 1986, as amended.

 

G.                                     Common
Stock shall mean shares of the Corporation’s common stock.

 

H.                                    Corporation
shall mean Restoration Hardware, Inc., a Delaware corporation.

 

I.                                         Employee
shall mean an individual who is in the employ of the Corporation (or any Parent
or Subsidiary), subject to the control and direction of the employer entity as
to both the work to be performed and the manner and method of performance.

 

J.                                        Exercise
Date shall mean the date on which the option shall have been
exercised in accordance with Paragraph 9 of the Agreement.

 

K.                                    Exercise Price
shall mean the exercise price per Option Share as specified in the Grant
Notice.

 

L.                                      Expiration
Date shall mean the date on which the option expires as
specified in the Grant Notice.

 

M.                                 Fair
Market Value per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:

 

(i)                                     If
Common Stock is at the time traded on the Nasdaq National Market, then the Fair
Market Value shall be deemed equal to the closing selling price per share of
Common Stock on the date in question, as the price is reported by the National
Association of Securities Dealers on the Nasdaq National Market.  If there is no closing selling price for
Common Stock on the date in question, then the Fair Market Value shall be the
closing selling price on the last preceding date for which a closing selling
price is reported; or

 

A-2

 

(ii)                                  If
Common Stock is at the time listed on any Stock Exchange, then the Fair Market
Value shall be deemed equal to the closing selling price per share of Common
Stock on the date in question on the Stock Exchange determined by the Plan
Administrator to be the primary market for Common Stock, as such price is
officially quoted in the composite tape of transactions on such exchange.  If there is no closing selling price for
Common Stock on the date in question, then the Fair Market Value shall be the
closing selling price on the last preceding date for which such quotation
exists.

 

N.                                    Grant
Date shall mean the date of grant of the option as specified in
the Grant Notice.

 

O.                                    Grant
Notice shall mean the Notice of Grant of Stock Option
accompanying the Agreement, pursuant to which Optionee has been informed of the
basic terms of the option evidenced hereby.

 

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

 

Q.                                    Non-Statutory
Option shall mean an option not intended to satisfy the
requirements of Section 422 of the Code.

 

R.                                     Not for
Cause shall mean termination of the Optionee’s Service by the
Corporation for reasons other than for Cause.

 

S.                                      Notice of
Exercise shall mean the notice of exercise in the form attached
hereto as Exhibit I.

 

T.                                     Option
Shares shall mean the number of shares of Common Stock subject
to the option as specified in the Grant Notice.

 

U.                                    Optionee
shall mean the person to whom the option is granted as specified in the Grant
Notice.

 

V.                                     Parent
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations ending with the Corporation, provided each corporation in the
unbroken chain (other than the Corporation) owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

 

W.                                Permanent
Disability shall mean the inability of Optionee to engage in any
substantial gainful activity by reason of any medically determinable physical
or mental impairment which is expected to result in death or has lasted or can
be expected to last for a continuous period of twelve (12) months or more.

 

X.                                    Plan
shall mean the Corporation’s 1998 Stock Incentive Plan Amended and Restated on
October 9, 2002.

 

A-3

 

Y.                                     Plan
Administrator shall mean either the Board or a committee of the
Board acting in its capacity as administrator of the Plan.

 

Z.                                     Service
shall mean the Optionee’s performance of services for the Corporation (or any
Parent or Subsidiary) in the capacity of an Employee, a non-employee member of
the board of directors or a consultant or independent advisor.

 

AA.                         Stock
Exchange shall mean the American Stock Exchange or the New York
Stock Exchange.

 

BB.                             Subsidiary
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations beginning with the Corporation, provided each corporation (other
than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

 

A-4

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