Document:

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                                                                     EXHIBIT 4.1

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                               INDENTURE OF TRUST

                                  by and among

                      [EDUCATION FUNDING CAPITAL TRUST -__]

                                       and

                           [NAME OF INDENTURE TRUSTEE]

                              as Indenture Trustee

                                       and

                     [NAME OF TRUST ELIGIBLE LENDER TRUSTEE]

                        as Trust Eligible Lender Trustee

                          Dated as of __________, 20___

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                                                              Indenture of Trust

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                      [EDUCATION FUNDING CAPITAL TRUST -__]

Reconciliation and tie between Trust Indenture Act of 1939 and Indenture of
Trust dated as of __________, 20___.

      TRUST INDENTURE                                             INDENTURE
        ACT SECTION                                                SECTION
      ---------------                                             ---------
Section 310(a)(1)&(2)............................................  6.22
           (a)(3)   .............................................  N/A
           (a)(4)   .............................................  6.08
           (a)(5)   .............................................  6.22
           (b)      .............................................  6.20
           (c)      .............................................  N/A
Section 311(a)      .............................................  6.25
           (b)      .............................................  6.25
           (c)      .............................................  N/A
Section 312(a)      .............................................  8.14
           (b)      .............................................  8.14
           (c)      .............................................  8.14
Section 313(a)      .............................................  11.04
           (b)      .............................................  11.04
           (c)      .............................................  3.17
           (d)      .............................................  3.17
Section 314(a)(1)-(3)............................................  3.17
           (a)(4)   .............................................  3.18
           (b)      .............................................  3.09
           (c)      .............................................  11.06(a)
           (d)      .............................................  11.06 (c)(e)
           (e)      .............................................  11.06 (a)
           (f)      .............................................  11.06 (k)
Section 315(a)      .............................................  6.01(a), 6.06
           (b)      .............................................  7.04
           (c)      .............................................  6.01(b)
           (d)(1)(2).............................................  6.06
           (d)(3)   .............................................  5.11
           (e)      .............................................  8.18
Section 316(a)(1)(A).............................................  5.11
           (a)(1)(B).............................................  5.14
           (a)(2)   .............................................  N/A
           (b)      .............................................  5.12
           (c)      .............................................  N/A
Section 317(a)(1)   .............................................  3.19
           (a)(2)   .............................................  6.24
           (b)      .............................................  4.11
Section 318(a)      .............................................  8.07

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

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                                                              Indenture of Trust

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                                TABLE OF CONTENTS

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

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

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<TABLE>
<S>      <C>                                                                                                    <C>
         Section 3.20 Representations of the Issuer Regarding the Indenture Trustee's Security Interest..........26
         Section 3.21 Covenants of the Issuer Regarding the Indenture Trustee's Security Interest................27
         Section 3.22 Certain Tax Forms and Treatment............................................................27
ARTICLE IV   ACCOUNTS............................................................................................28
         Section 4.01 Creation and Continuation of Trust Accounts and Accounts...................................28
         Section 4.02 Acquisition Account........................................................................29
         Section 4.03 Collection Account.........................................................................30
         Section 4.04 Distribution Account.......................................................................36
         Section 4.05 Reserve Account............................................................................37
         Section 4.06 Transfers to Co-Owner Trustee..............................................................37
         Section 4.07 Capitalized Interest Account...............................................................37
         Section 4.08 Investment of Funds Held by Indenture Trustee..............................................38
         Section 4.09 Indenture Trustee's Control over the Trust Accounts........................................39
         Section 4.10 Release; Sale or Exchange of Financed Student Loans........................................40
         Section 4.11 Purchase of Notes..........................................................................40
ARTICLE V    DEFAULTS AND REMEDIES...............................................................................40
         Section 5.01 Events of Default Defined..................................................................40
         Section 5.02 Remedy on Default; Possession of Trust Estate..............................................41
         Section 5.03 Remedies on Default; Advice of Counsel.....................................................43
         Section 5.04 Remedies on Default; Sale of Trust Estate..................................................43
         Section 5.05 Appointment of Receiver....................................................................44
         Section 5.06 Restoration of Position....................................................................44
         Section 5.07 Purchase of Properties by Indenture Trustee or Noteholders.................................44
         Section 5.08 Application of Sale Proceeds...............................................................45
         Section 5.09 Accelerated Maturity.......................................................................45
         Section 5.10 Remedies Not Exclusive.....................................................................45
         Section 5.11 Direction of Indenture Trustee.............................................................45
         Section 5.12 Right to Enforce in Indenture Trustee......................................................46
         Section 5.13 Physical Possession of Obligations Not Required............................................46
         Section 5.14 Waivers of Events of Default...............................................................46
ARTICLE VI   THE INDENTURE TRUSTEE...............................................................................47
         Section 6.01 Acceptance of Trust........................................................................47
         Section 6.02 Recitals of Others.........................................................................48
         Section 6.03 As to Filing of Indenture..................................................................48
         Section 6.04 Indenture Trustee May Act Through Agents...................................................48
         Section 6.05 Indemnification of Indenture Trustee.......................................................48
         Section 6.06 Indenture Trustee's Right to Reliance......................................................49
         Section 6.07 Compensation of Indenture Trustee..........................................................50
         Section 6.08 Indenture Trustee May Own Notes............................................................51
         Section 6.09 Resignation of Indenture Trustee...........................................................51
         Section 6.10 Removal of Indenture Trustee...............................................................51
         Section 6.11 Successor Indenture Trustee................................................................52
         Section 6.12 Manner of Vesting Title in Indenture Trustee...............................................52
</TABLE>

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<TABLE>
<S>                                                                                                              <C>
         Section 6.13 Additional Covenants by the Indenture Trustee to Conform to the Act........................53
         Section 6.14 Limitation with Respect to Examination of Reports..........................................53
         Section 6.15 Master Servicing Agreement.................................................................53
         Section 6.16 Additional Covenants of Indenture Trustee..................................................53
         Section 6.17 Duty of Indenture Trustee with Respect to Rating Agencies..................................54
         Section 6.18 Merger of the Indenture Trustee............................................................55
         Section 6.19 Receipt of Funds from Master Servicer......................................................55
         Section 6.20 Special Circumstances Leading to Resignation of Indenture Trustee..........................55
         Section 6.21 Survival of Indenture Trustee's Rights to Receive Compensation, Reimbursement and
                       Indemnification...........................................................................55
         Section 6.22 Corporate Trustee Required; Eligibility; Conflicting Interests.............................55
         Section 6.23 Payment of Taxes and Other Governmental Charges............................................56
         Section 6.24 Indenture Trustee May File Proofs of Claim.................................................56
         Section 6.25 Preferential Collection of Claims Against Issuer...........................................57
ARTICLE VII  SUPPLEMENTAL INDENTURES.............................................................................57
         Section 7.01 Supplemental Indentures Not Requiring Consent of Noteholders...............................57
         Section 7.02 Supplemental Indentures Requiring Consent of Noteholders...................................59
         Section 7.03 Additional Limitation on Modification of Indenture.........................................60
         Section 7.04 Notice of Defaults.........................................................................60
         Section 7.05 Conformity With the Trust Indenture Act ...................................................60

ARTICLE VIII GENERAL PROVISIONS..................................................................................60
         Section 8.01 Notices....................................................................................60
         Section 8.02 Covenants Bind Issuer......................................................................62
         Section 8.03 Lien Created...............................................................................62
         Section 8.04 Severability of Lien.......................................................................62
         Section 8.05 Consent of Noteholders Binds Successors....................................................62
         Section 8.06 Nonpresentment of Notes or Interest Checks.................................................62
         Section 8.07 Laws Governing.............................................................................63
         Section 8.08 Severability...............................................................................63
         Section 8.09 Exhibits...................................................................................63
         Section 8.10 Non-Business Days..........................................................................63
         Section 8.11 Parties Interested Herein..................................................................63
         Section 8.12 Obligations Are Limited Obligations........................................................63
         Section 8.13 Counterparty Rights........................................................................63
         Section 8.14 Disclosure of Names and Addresses of Noteholders...........................................64
         Section 8.15 Aggregate Principal Amount of Obligations..................................................64
         Section 8.16 Financed Student Loans.....................................................................64
         Section 8.17 Limitation of Liability of the Co-Owner Trustee............................................64
         Section 8.18 Undertaking for Costs......................................................................64
ARTICLE IX   PAYMENT AND CANCELLATION OF NOTES AND SATISFACTION OF INDENTURE.....................................65
         Section 9.01 Trust Irrevocable..........................................................................65
         Section 9.02 Satisfaction of Indenture..................................................................65
         Section 9.03 Cancellation of Paid Notes.................................................................65

</TABLE>

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<TABLE>
<S>      <C>                                                                                                    <C>
ARTICLE X    TERMINATION.........................................................................................65
         Section 10.01 Termination of the Trust..................................................................65
         Section 10.02 Notice....................................................................................66
         Section 10.03 Auction of Financed Student Loans.........................................................66
ARTICLE XI   REPORTING REQUIREMENTS..............................................................................67
         Section 11.01 Annual Statement as to Compliance.........................................................67
         Section 11.02 Annual Independent Public Accountant's Servicing Report...................................67
         Section 11.03 Master Servicer's Certificate.............................................................67
         Section 11.04 Statements to Noteholders.................................................................67
         Section 11.05 Compliance Certificates and Opinions......................................................70
         Section 11.06 Incorporation by Reference of the Trust Indenture Act.....................................72

APPENDIX A            DEFINITIONS AND USAGE
APPENDIX B            CERTAIN TERMS AND PROVISIONS OF THE AUCTION RATE NOTES

EXHIBIT A-1           FORM OF CLASS A NOTES
EXHIBIT A-2           FORM OF CLASS B NOTES
EXHIBIT B             STUDENT LOAN ACQUISITION CERTIFICATE
EXHIBIT C             CLOSING CASH FLOW PROJECTIONS
EXHIBIT D             NOTICE OF PAYMENT DEFAULT
EXHIBIT E             NOTICE OF CURE OF PAYMENT DEFAULT
EXHIBIT F             NOTICE OF PROPOSED CHANGE IN LENGTH OF ONE OR MORE AUCTION PERIODS
EXHIBIT G             NOTICE ESTABLISHING CHANGE IN LENGTH OF ONE OR MORE AUCTION PERIODS
EXHIBIT H             NOTICE OF CHANGE IN AUCTION DATE
</TABLE>

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                               INDENTURE OF TRUST

        This Indenture of Trust, dated as of __________, 20___ (this
"Indenture"), is by and among [EDUCATION FUNDING CAPITAL TRUST -__], a Delaware
statutory trust (the "Issuer"), [NAME OF INDENTURE TRUSTEE], a(n) __________
organized under the laws of the __________, as indenture trustee (the "Indenture
Trustee"), and [NAME OF TRUST ELIGIBLE LENDER TRUSTEE], a(n) __________
organized under the laws of the __________, , as trust eligible lender trustee
(the "Trust Eligible Lender Trustee"). Capitalized terms used herein and not
defined herein shall have the meanings assigned to such terms in Appendix A
hereto, which also contains rules of usage and construction that shall be
applicable herein.

                              W I T N E S S E T H:

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

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

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

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

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

                                                              Indenture of Trust

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                                GRANTING CLAUSE A

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

                                GRANTING CLAUSE B

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

                                GRANTING CLAUSE C

        The Financed Student Loans;

                                GRANTING CLAUSE D

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

                                GRANTING CLAUSE E

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

                                GRANTING CLAUSE F

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

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

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

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

                                        2
                                                              Indenture of Trust

<PAGE>

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

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

                                    ARTICLE I

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

        Section 1.01 Note Details.

        (a) The Notes shall be issued in __________ (___) separate series
consisting of $__________ of Series A-___ Notes, $__________ of Series A-___
Notes, $__________ of Series A-___ Notes, $__________ of Series A-___ Notes,
$__________ of Series A-___ Notes, $__________ of Series A-___ Notes,
$__________ of Series A-___ Notes, $__________ of Series A-___ Notes, and
$__________ of Series B-___ Notes.

        The Series A-___ Notes will mature no later than __________, 20___. The
Series A-___ Notes will mature no later than __________, 20___. The Series A-___
Notes will mature no later than __________, 20___. The Series A-___ Notes will
mature no later than __________, 20___. The Series A-___ Notes will mature no
later than __________, 20___. The Series A-___ Notes will mature no later than
__________, 20___. The Series A-___ Notes will mature no later than __________,
20___. The Series A-___ Notes will mature no later than __________, 20___. The
Series B-___ Notes will mature no later than __________, 20___.

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

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

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

        (i)     The Series A-___ interest rate will be __________-month LIBOR,
                except for the first Accrual Period, plus _____%;

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

        (iii)   The Series A-___ interest rate will be __________-month LIBOR,
                except for the first Accrual Period, plus _____%.

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

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

        One-month, two-month, three-month or four-month LIBOR, for any Accrual
Period, is the London interbank offered rate for deposits in U.S. Dollars having
a maturity of one month, two-months, three months or four months, as applicable,
commencing on the first day of the Accrual Period, which appears on Telerate
Page 3750 as of 11:00 a.m. London time, on the related LIBOR Determination Date.
If an applicable rate does not appear on Telerate Page 3750, the rate for that
day will be determined on the basis of the rates at which deposits in U.S.
Dollars, having the applicable maturity and in a principal amount of not less
than U.S. $1,000,000, are offered at approximately 11:00 a.m., London time, on
that LIBOR Determination Date, to prime banks in the London interbank market by
the Reference Banks. The Calculation Agent shall request the principal London
office of each Reference Bank to provide a quotation of its rate. If the
Reference Banks provide at least two quotations, the rate for that day will be
the arithmetic mean of the quotations. If the Reference Banks provide fewer than
two quotations, the rate for that day will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Calculation Agent, at
approximately 11:00 a.m. New York time, on that LIBOR Determination Date, for
loans in U.S. Dollars to leading European banks having the applicable maturity
and in a principal amount of not less than U.S. $1,000,000. If the banks
selected as described above are not providing quotations, one-month, two-month,
three-month or four-month LIBOR in effect for the applicable Accrual Period
shall be the one-month, two-month, three-month or four-month LIBOR in effect for
the previous Accrual Period.

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        For this purpose:

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

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

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

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

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

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

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<PAGE>

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

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

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

                                        6
                                                              Indenture of Trust

<PAGE>

        Section 1.02 Payment of Principal; Redemption.

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

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

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

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

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

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

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

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

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

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

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

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

                                        7
                                                              Indenture of Trust

<PAGE>

        However, following the occurrence of an Event of Default and the
exercise by the Indenture Trustee of remedies under Article V, principal
payments on the Class A Notes shall be made or set aside for future distribution
pro rata, without preference or priority.

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

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

        Notwithstanding the foregoing, if

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

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

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

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

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

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

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

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

                                        8
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

        (b) A duly executed copy of this Indenture.

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

        Section 1.04 Registration, Transfer and Exchange of Notes; Persons
Treated as Noteholders. The Issuer shall cause books for the registration and
for the transfer of the Notes as provided in this Indenture to be kept by the
Indenture Trustee, which is hereby appointed the transfer agent of the Issuer
for the Notes. Notwithstanding such appointment and with the prior written
consent of the Issuer, the Indenture Trustee is hereby authorized to make any
arrangements with other institutions that it deems necessary or desirable in
order that such institutions may perform the duties of transfer agent for the
Notes. Upon surrender for transfer of any Note at the Corporate Trust Office of
the Indenture Trustee, duly endorsed for transfer or accompanied by an
assignment duly executed by the Noteholder or his attorney duly authorized

                                        9
                                                              Indenture of Trust

<PAGE>

in writing, the Issuer shall execute and the Indenture Trustee shall
authenticate and deliver, making all appropriate notations on its records, and
causing the same to be made on the records of its nominees, in the name of the
transferee or transferees a new fully registered Note or Notes of the same
interest rate and for a like Series, subseries, if any, and aggregate principal
amount of the same maturity.

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

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

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

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

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

                                       10
                                                              Indenture of Trust

<PAGE>

        Section 1.06 Indenture Trustee's Authentication Certificate. The
Indenture Trustee's authentication certificate upon the Notes shall be
substantially in the forms provided in Exhibits A-1 and A-2. No Note shall be
secured hereby or entitled to the benefit hereof, or shall be valid or
obligatory for any purpose, unless a certificate of authentication,
substantially in such form, has been duly executed by the Indenture Trustee at
the written direction of the Issuer; and such certificate of the Indenture
Trustee upon any Note shall be conclusive evidence and the only competent
evidence that such Note has been authenticated and delivered hereunder. The
Indenture Trustee's certificate of authentication shall be deemed to have been
duly executed by it if manually signed by an authorized officer of the Indenture
Trustee, but it shall not be necessary that the same person sign the certificate
of authentication on all of the Notes issued hereunder.

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

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

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

        (a)     an amount equal to $__________ shall be deposited to the
                Acquisition Account;

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

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

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

                                       11
                                                              Indenture of Trust

<PAGE>

                                   ARTICLE II

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

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

        Section 2.02 Other Obligations.

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

        (b) The revenues and other moneys, Financed Student Loans, securities,
evidences of indebtedness, interests, rights and properties pledged under this
Indenture are and will be owned by the Issuer (or the Trust Eligible Lender
Trustee) free and clear of any pledge, lien, charge or encumbrance thereon or
with respect thereto prior to or of equal rank with the respective pledges
created by this Indenture, except as otherwise expressly provided herein, and
all action on the part of the Issuer to that end has been duly and validly
taken. If any Financed Student Loan is found to have been subject to a lien at
the time such Financed Student Loan was acquired, the Issuer shall cause such
lien to be released, shall purchase such Financed Student Loan from the Trust
Estate for a purchase price equal to its principal amount plus unamortized
premium, if any, and interest accrued thereon, or shall replace such Financed
Student Loan with another Student Loan with substantially identical
characteristics that shall be free and clear of liens at the time of such
replacement. Except as otherwise provided herein, the Issuer shall not create or
voluntarily permit to be created any debt, lien, or charge on the Financed
Student Loans that would be on a parity with or prior to the lien of this
Indenture; shall not do or omit to do or suffer to be done or omitted to be done
anything whatsoever whereby the lien of this Indenture or the priority of such
lien for the Obligations hereby secured might or could be lost or impaired; and
will pay or cause to be paid or will make adequate provisions for the
satisfaction and discharge of all lawful claims and demands that if unpaid might
by law be given precedence to or any equality with this Indenture as a lien or
charge upon the Financed Student Loans; provided, however, that nothing in this
subsection (b) shall require the Issuer to pay, discharge, or make provision for
any such lien, charge, claim, or demand so long as the validity thereof shall be
by it in good faith contested, unless thereby, the same will endanger the
security for the Obligations; and provided further that any subordinate lien
hereon (i.e., subordinate to the lien securing the Senior Obligations and the
Subordinate Obligations) shall be entitled to no payment from the

                                       12
                                                              Indenture of Trust

<PAGE>

Trust Estate, nor may any remedy be exercised with respect to such subordinate
lien against the Trust Estate until all Obligations have been paid or deemed
paid hereunder.

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

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

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

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

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

                                       13
                                                              Indenture of Trust

<PAGE>

                                   ARTICLE III

            PROVISIONS APPLICABLE TO THE NOTES; DUTIES OF THE ISSUER

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

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

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

        Section 3.04 Further Covenants of the Issuer.

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

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

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

                                       14
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

        (a)     The Issuer shall diligently enforce and take all reasonable
                steps, actions and proceedings necessary for the enforcement of
                all terms, covenants and

                                       15
                                                              Indenture of Trust

<PAGE>

                conditions of the Master Servicing Agreement, including the
                prompt payment of all amounts due the Issuer thereunder,
                including without limitation all principal and interest payments
                and Guarantee Payments that relate to any Financed Student
                Loans, and cause the Master Servicer to specify whether payments
                received by it represent principal or interest;

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

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

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

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

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

        (g)     The Issuer shall cause the Master Servicer to deliver to the
                Indenture Trustee and the Issuer, on or before March 31 of each
                year, beginning with March 31, 20___, a certificate stating that
                (i) a review of the activities of the Master Servicer during the
                preceding calendar year and of its performance under the Master
                Servicing Agreement has been made under the supervision of the
                officer signing such certificate and (ii) to the best of such
                officer's knowledge, based on such review, the Master Servicer
                has fulfilled all its obligations under the Master Servicing
                Agreement throughout such year, or, there has been a default in
                the fulfillment of any such obligation, specifying each such
                default known to such officer and the nature and status thereof.
                The Issuer shall send copies of such annual certificate of the
                Master Servicer to each Rating Agency; and

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

                                       16
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

                                       17
                                                              Indenture of Trust

<PAGE>

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

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

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

        Section 3.09 Opinions as to the Trust Estate.

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

        (b) On or before March 31, in each calendar year, beginning in 20___,
the Issuer shall furnish to the Indenture Trustee and any Counterparties an
Opinion of Counsel either stating that, in the opinion of such counsel, such
action has been taken with respect to the recording, filing, re-recording and
refiling of this Indenture, any Supplemental Indentures and any other requisite
documents and with respect to the filing of any financing statements and
continuation statements as are necessary to maintain the lien and security
interest created by this Indenture and reciting the details of such action, or
stating that in the opinion of such counsel no such action is necessary to
maintain such lien and security interest. Such Opinion of Counsel shall also
describe the recording, filing, re-recording and refiling of this Indenture, any
Supplemental Indentures and any other requisite documents and the filing of any
financing statements and continuation statements that will, in the opinion of
such counsel, be required to maintain the lien and security interest of this
Indenture until March 31 of the following calendar year. If the Indenture
Trustee does not receive the Opinion of Counsel required by this paragraph on or
before the date required or if such Opinion of Counsel indicates that the
security interest created by this Indenture is no longer in effect or
maintained, the Indenture Trustee shall promptly notify each Rating Agency and
each Noteholder of such event.

                                       18
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

        Section 3.14 Representations; Negative Covenants.

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

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

                                       19
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

                                       20
                                                              Indenture of Trust

<PAGE>

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

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

        (x) Legal Name. The legal name of the Issuer is "[EDUCATION FUNDING
    CAPITAL TRUST -__]" and has not changed since its formation. The Issuer has
    no tradenames, fictitious names, assumed names or "dba's" under which it
    conducts its business and has made no filing in respect of any such name.

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

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

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

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

                                       21
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

        (b) The Issuer will not:

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

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

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

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

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

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

                                       22
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

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

                                       23
                                                              Indenture of Trust

<PAGE>

    Student Loans (other than the security interest created in favor of the
    Indenture Trustee) to be created.

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

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

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

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

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

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

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

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

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

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

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

                                       24
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

        Section 3.17 Reports by Issuer. The Issuer shall:

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

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

                                       25
                                                              Indenture of Trust

<PAGE>

to clauses (a) and (b) of this Section 3.17 as may be required by rules and
regulations prescribed from time to time by the Commission.

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

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

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

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

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

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

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

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

                                       26
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

        Section 3.22 Certain Tax Forms and Treatment.

        (a) Each Noteholder and any beneficial owner of a Note, if required by
law, shall timely furnish the Issuer or its agents any U.S. federal income tax
form or certification (such as IRS Form W-8BEN (Certification of Foreign Status
as Beneficial Owner), Form W-8IMY

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                                                              Indenture of Trust

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

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

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

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

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

                                   ARTICLE IV

                                    ACCOUNTS

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

        (i)     Acquisition Account;

        (ii)    Collection Account;

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<PAGE>

        (iii)   Distribution Account;

        (iv)    Reserve Account; and

        (v)     Capitalized Interest Account.

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

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

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

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

        Amounts remaining in the Acquisition Account on __________, 20___, after
giving effect to all withdrawals from the Acquisition Account on or prior to
that date, will be transferred to the Collection Account; provided, however, the
transfer of those amounts may be delayed until a later date if the Issuer has
received a Rating Confirmation with respect to that delay.

        On each Quarterly Distribution Date occurring while any LIBOR Notes are
Outstanding, and thereafter on each Monthly Allocation Date, to the extent
amounts on deposit in the Distribution Account and allocated to the payment of
interest on the Notes, amounts on deposit in the Collection Account representing
interest receipts on the Financed Student Loans, and amounts on deposit in the
Capitalized Interest Account are insufficient to make the transfers required by
clauses (i) and (ii) of each of Sections 4.03(d) and 4.03(e), or if on the
Stated Maturity of any Series of Notes, amounts on deposit in the Distribution
Account and allocated to

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<PAGE>

the payment of principal on that Series of Notes and amounts on deposit in the
Collection Account are insufficient to make the required principal distributions
to the Noteholders of that Series of Notes, to the extent of moneys in the
Acquisition Account the amount of such deficiency shall be paid from the
Acquisition Account before applying to that payment any amounts on deposit in
the Reserve Account pursuant to Section 4.05(a).

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

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

        Section 4.03 Collection Account.

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

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

        (v)     fifth, deposit into the Distribution Account for the Master
                Servicer and Administrator, pro rata, the amounts of the Master
                Servicing Fee and Administration Fee expected to be payable from
                the ____ day of the current calendar month to the ____ day of
                the subsequent calendar month plus previously accrued and unpaid
                or set aside amounts;

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

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

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

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                                                              Indenture of Trust

<PAGE>

Secretary shall be paid directly to the Secretary unless the Administrator or
Master Servicer submits written evidence satisfactory to the Indenture Trustee
that the rebate fee has already been paid.]

        (d) On each Quarterly Distribution Date occurring on or before the date
on which no LIBOR Notes remain Outstanding, and thereafter on each Monthly
Allocation Date, the indenture trustee shall make the deposits and distributions
set forth in clauses (i) through (xix) below, and in the case of a Quarterly
Distribution Date or Monthly Allocation Date that is not an Auction Rate
Distribution Date for all Auction Rate Notes, allocations to the Distribution
Account with respect to those Auction Rate Notes (for principal and Carry-over
Amounts), in the amounts and in the order of priority shown in clauses (i)
through (xix) below, except as otherwise provided in Section 1.02(c). The
Indenture Trustee shall calculate the amounts payable as Class A Noteholders'
Interest Distribution Amount and Class B Noteholders' Interest Distribution
Amounts. These deposits and distributions shall be made from amounts on deposit
in the Distribution Account and allocated to the applicable payment; from and to
the extent of the Available Funds on that Distribution Date after payment of the
fees set forth in 4.03(c); from amounts transferred from the Capitalized
Interest Account through ________, 20__ with respect to clauses (i) and (ii)
below on that Distribution Date; from amounts transferred from the Acquisition
Account with respect to clauses (i) and (ii) below on that Distribution Date and
with respect to the payment of principal on the Class A Notes and Class B Notes
at their Stated Maturities; and from amounts transferred from the Reserve
Account with respect to clauses (i) and (ii) below on that Distribution Date and
with respect to the payment of principal on the Class A Notes and Class B Notes
at their Stated Maturities.

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

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

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

        (xiii)  if the Parity Percentage is not equal to at least the Required
                Parity Percentage or the Senior Parity Percentage is not equal
                to at least the Required Senior Parity Percentage, to the
                Distribution Account to pay principal on the Class A Notes on
                their next respective Distribution Dates, in the order and
                priority described in Section 1.02(b), the least amount required
                to increase the Parity Percentage to at least the Required
                Parity Percentage and the Senior Parity Percentage to at least
                the Required Senior Parity Percentage, with those percentages
                computed assuming that immediately prior to the computation, the
                required payments of principal were actually made on the Class A
                Notes;

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

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

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

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

        (xviii) pro rata, based on the amount of any Other Issuer Termination
                Payments due pursuant to this clause, to the Counterparties
                under each Derivative

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                                                              Indenture of Trust

<PAGE>

                Product payable on a parity with the Class B Notes, the amount
                of any Other Issuer Termination Payments due and payable; and

        (xix)   to the Co-Owner Trustee for deposit into the Certificate
                Distribution Account, any remaining amounts after application of
                the preceding clauses if, and after giving effect to the
                transfer of any amounts to the Co-Owner Trustee, the Parity
                Percentage is equal to at least the Required Parity Percentage
                and the Senior Parity Percentage is equal to at least the
                Required Senior Parity Percentage.

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

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

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

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

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

        (ii)    second, from amounts deposited in the Distribution Account that
                were allocated to the Class B Auction Rate Notes with a
                Distribution Date on this Auction Rate Distribution Date and to
                Counterparties under Derivative Products payable on a parity
                with those Class B Auction Rate Notes, and then from amounts on
                deposit in the Collection Account, pro

                                       35
                                                              Indenture of Trust

<PAGE>

                rata, based on the aggregate principal balance of those Class B
                Auction Rate Notes and the amount payable as Scheduled Issuer
                Derivative Payments and Specified Issuer Termination Payments
                under each Derivative Product payable on a parity with those
                Class B Auction Rate Notes:

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

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

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

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

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

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

        Section 4.04 Distribution Account.

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

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                                                              Indenture of Trust

<PAGE>

        Section 4.05 Reserve Account.

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

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

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

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

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

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

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

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

        Section 4.07 Capitalized Interest Account. On each Quarterly
Distribution Date occurring while any LIBOR Notes are Outstanding, and
thereafter on each Monthly Allocation

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                                                              Indenture of Trust

<PAGE>

Date, to the extent moneys on deposit in the Distribution Account allocated to
the payment of interest on the Notes and moneys on deposit in the Collection
Account representing interest payments on the Financed Student Loans are
insufficient to make the transfers required by clauses (i) and (ii) of each of
Sections 4.03(d) and 4.03(e), to the extent of moneys in the Capitalized
Interest Account the amount of such deficiency shall be paid from the
Capitalized Interest Account before any amounts on deposit in the Collection
Account representing principal payments on the Financed Student Loans are used
to pay such deficiency and before applying to that payment amounts on deposit in
the Acquisition Account pursuant to Section 4.02 or amounts on deposit in the
Reserve Account pursuant to Section 4.05(a). Amounts remaining in the
Capitalized Interest Account on __________, 20___, after giving effect to all
withdrawals from the Capitalized Interest Account on or prior to that date, will
be transferred to the Collection Account and, subject to the Rating Agency
Condition, may be transferred to the Collection Account on an earlier date.

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

        The Eligible Investments purchased with moneys held for the credit of
any Account or Subaccount shall be held by the Indenture Trustee and shall be
deemed at all times to be part of such Account or Subaccount, and the Indenture
Trustee shall inform the Issuer of the details of all such investments. Upon
direction in writing from an Authorized Officer of the Issuer, the Indenture
Trustee shall use its best efforts to sell at the best price obtainable, or
present for redemption, any Eligible Investments purchased by it as an
investment whenever it shall be necessary to provide money to meet any payment
from the applicable Account or Subaccount. The Indenture Trustee shall advise
the Issuer in writing, on or before the _____ day of each calendar month (or
such later date as reasonably consented to by the Issuer), of all investments
held for the credit of each Account and Subaccount in its custody under the
provisions of this Indenture as of the end of the preceding month and the value
thereof, and shall list any investments that were sold or liquidated for less
than their Value at the time thereof.

        Money in any Account or Subaccount constituting a part of the Trust
Estate may be pooled for the purpose of making investments and may be used to
pay accrued interest on Eligible Investments purchased. Money in any Account or
Subaccount constituting a part of the Trust Estate may not be pooled with money
held outside of the Trust Estate for the purpose of

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                                                              Indenture of Trust

<PAGE>

making investments. The Indenture Trustee and its affiliates may act as
principal or agent in the acquisition or disposition of any Eligible
Investments.

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

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

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

above shall be delivered to the Indenture Trustee in accordance with paragraph
(c) of the definition of "Delivery."

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

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

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

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

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

                                    ARTICLE V

                              DEFAULTS AND REMEDIES

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

                                       41
                                                              Indenture of Trust

<PAGE>

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

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

                                       42
                                                              Indenture of Trust

<PAGE>

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

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

        Section 5.04 Remedies on Default; Sale of Trust Estate. Upon the
happening of any Event of Default and if the principal of all of the Outstanding
Obligations shall have been

                                       43
                                                              Indenture of Trust

<PAGE>

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

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

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

        Section 5.07 Purchase of Properties by Indenture Trustee or Noteholders.
In case of any such sale of the Trust Estate, any Noteholder or Noteholders or
committee of Noteholders or the Indenture Trustee, may bid for and purchase such
property and upon compliance with the terms of sale may hold, retain possession,
and dispose of such property as the absolute right of

                                       44
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

                                       45
                                                              Indenture of Trust

<PAGE>

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

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

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

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

        Section 5.14 Waivers of Events of Default. The Indenture Trustee may in
its discretion waive any Event of Default hereunder and its consequences and
rescind any declaration of acceleration of Obligations, and shall do so upon the
written request of the Noteholders of at least a majority of the principal
amount of the Highest Priority Obligations then Outstanding; provided, however,
that there shall not be waived (a) any Event of Default in

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the payment of the principal of or premium on any Outstanding Obligations at the
date of maturity or redemption thereof, or any default in the payment when due
of the interest on any such Obligations, unless prior to such waiver or
rescission, all arrears of interest or all arrears of payments of principal and
premium, if any, and all expenses of the Indenture Trustee, in connection with
such default shall have been paid or provided for or (b) any default in the
payment of amounts set forth in Section 6.05. In case of any such waiver or
rescission, or in case any proceedings taken by the Indenture Trustee on account
of any such default shall have been discontinued or abandoned or determined
adversely to the Indenture Trustee, then and in every such case the Issuer, the
Indenture Trustee and the holders of Obligations shall be restored to their
former positions and rights hereunder respectively, but no such waiver or
rescission shall extend to or affect any subsequent or other default, or impair
any rights or remedies consequent thereon.

                                   ARTICLE VI

                              THE INDENTURE TRUSTEE

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

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

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

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

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

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

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

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

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

        Section 6.05 Indemnification of Indenture Trustee. Other than with
respect to its duties to make payment on the Obligations when due, and its duty
to pursue the remedy of acceleration as provided in Section 5.02, for each of
which no additional security or indemnity may be required, the Indenture Trustee
shall be under no obligation or duty to perform any act at the request of
Noteholders or to institute or defend any suit in respect thereof unless
properly indemnified and provided with security to its satisfaction as provided
in Section 6.01(c). The Indenture Trustee shall not be required to take notice,
or be deemed to have knowledge, of any default or Event of Default of the Issuer
hereunder and may conclusively assume that there has been no such default or
Event of Default (other than an Event of Default described in Sections 5.01(a)
or (b)) unless and until a Responsible Officer shall have been specifically
notified in writing at the address in Section 8.01 of such default or Event of
Default by (a) the Noteholders of the required percentages in principal amount
of the Obligations then Outstanding hereinabove specified or (b) an Authorized
Officer of the Issuer. However, the Indenture Trustee may begin suit, or appear
in and defend suit, execute any of the trusts hereby created, enforce any of its
rights or powers hereunder, or do anything else in its judgment proper to be
done by it as Indenture Trustee, without assurance of reimbursement or
indemnity, and in such case the Indenture Trustee shall be reimbursed or
indemnified by the Noteholders requesting such action,

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if any, or the Issuer in all other cases, for all fees, costs and expenses,
liabilities, outlays and counsel fees and other reasonable disbursements
properly incurred in connection therewith, unless such costs and expenses,
liabilities, outlays and attorneys' fees and other reasonable disbursements
properly incurred in connection therewith are adjudicated to have resulted from
the negligence or willful misconduct of the Indenture Trustee. In furtherance
and not in limitation of this Section 6.05, the Indenture Trustee shall not be
liable for, and shall be held harmless by the Issuer from, following any orders,
instructions or other directions upon which the Indenture Trustee is authorized
to rely pursuant to this Indenture or any other agreement to which it is a
party. If the Issuer or the Noteholders, as appropriate, shall fail to make such
reimbursement or indemnification, the Indenture Trustee may reimburse itself
from any money in its possession under the provisions of this Indenture, subject
only to the prior lien of the Notes for the payment of the principal thereof,
premium, if any, and interest thereon from the Collection Account. None of the
provisions contained in this Indenture or any other agreement to which it is a
party shall require the Indenture Trustee to act or to expend or risk its own
funds or otherwise incur individual financial liability in the performance of
any of its duties or in the exercise of any of its rights or powers (excluding,
however, any duties, rights or powers of the Indenture Trustee acting as Master
Servicer pursuant to Section 6.15) if the Noteholders shall not have offered
security and indemnity acceptable to it or if it shall have reasonable grounds
for believing that prompt repayment of such funds or adequate indemnity against
such risk or liability is not reasonably assured to it.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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        Section 6.23 Payment of Taxes and Other Governmental Charges.

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

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

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

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

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

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

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

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

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

                                   ARTICLE VII

                             SUPPLEMENTAL INDENTURES

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

        If at any time the Issuer shall request that the Indenture Trustee enter
into any such Supplemental Indenture for any of the purposes in this Section
7.02, the Indenture Trustee shall be entitled to receive an Opinion of Counsel
from the Issuer that all conditions precedent to the execution of any
Supplemental Indenture have been met. The Indenture Trustee shall, upon being
satisfactorily indemnified with respect to expenses, cause notice of the
proposed execution of such Supplemental Indenture to be mailed by registered or
certified mail to each Noteholder of an Obligation at the address shown on the
registration books or listed in any Derivative Product. Such notice (which shall
be prepared by the Issuer) shall briefly set forth the nature of the proposed
Supplemental Indenture and shall state that copies thereof are on file at the

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principal corporate trust office of the Indenture Trustee for inspection by all
Noteholders. If, within 60 days, or such longer period as shall be prescribed by
the Issuer, following the mailing of such notice, the Noteholders of not less
than a majority of the principal amount of each class of affected Notes and each
affected Derivative Product then Outstanding at the time of the execution of any
such Supplemental Indenture shall have consented in writing to and approved the
execution thereof as herein provided, no Noteholder of any Obligation shall have
any right to object to any of the terms and provisions contained therein, or the
operation thereof, or in any manner to question the propriety of the execution
thereof, or to enjoin or restrain the Indenture Trustee or the Issuer from
executing the same or from taking any action pursuant to the provisions thereof.

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

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

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

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

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

                                  ARTICLE VIII

                               GENERAL PROVISIONS

        Section 8.01 Notices. Any notice, request or other instrument required
by this Indenture to be signed or executed by the holders of Obligations may be
executed by the

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

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

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

        If intended for the Issuer:

                [EDUCATION FUNDING CAPITAL TRUST -__]
                c/o [Name of Co-Owner Trustee]
                [Address 1]
                [Address 2]
                Attention:
                Telephone:
                Facsimile:

                with a copy to:

                [name]
                [address 1]
                [address 2]
                Attention:
                Telephone:
                Facsimile:

        If intended for the Indenture Trustee:

                [Name of Indenture Trustee]
                [Address 1]

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<PAGE>

                [Address 2]
                Attention:
                Telephone:
                Facsimile:

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

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

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

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

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

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

        Section 8.06 Nonpresentment of Notes or Interest Checks. Should any of
the Notes or interest checks not be presented for payment when due, the
Indenture Trustee shall retain from any money transferred to it for the purpose
of paying the Notes or interest checks so due, for the benefit of the
Noteholders thereof, a sum of money sufficient to pay such Notes or interest
checks when the same are presented by the Noteholders thereof for payment. Such
money shall not be required to be invested. All liability of the Issuer to the
Noteholders of such Notes or interest checks and all rights of such Noteholders
against the Issuer under the Notes or interest checks or under this Indenture
shall thereupon cease and determine, and the sole right of such Noteholders
shall thereafter be against such deposit. If any Note or interest check shall
not

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be presented for payment within the period of two years following its payment or
redemption date, the Indenture Trustee shall return to the Issuer the money
theretofore held by it for payment of such Note or interest check, and such Note
or interest check shall (subject to the defense of any applicable statute of
limitation) thereafter be an unsecured obligation of the Issuer. The Indenture
Trustee's responsibility for any such money shall cease upon remittance thereof
to the Issuer.

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

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

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

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

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

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

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

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

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

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

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

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

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<PAGE>

                                   ARTICLE IX

         PAYMENT AND CANCELLATION OF NOTES AND SATISFACTION OF INDENTURE

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

        Section 9.02 Satisfaction of Indenture.

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

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

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

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

                                    ARTICLE X

                                   TERMINATION

        Section 10.01 Termination of the Trust.

        (a)     The trust created by this Indenture shall terminate upon the
later of (A) payment to the Noteholders and to the Indenture Trustee of all
amounts required to be paid to them pursuant to this Indenture and any
Supplemental Indenture and the disposition of all property held as part of the
Trust Estate or (B) the day following the date on which all reimbursement
obligations to the Counterparties, if any, and any other Person as may be

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<PAGE>

provided for in any Supplemental Indenture have been paid in full. The Issuer
shall promptly notify the Indenture Trustee of any prospective termination
pursuant to this Section 10.01.

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

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

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

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

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

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

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

                                   ARTICLE XI

                             REPORTING REQUIREMENTS

        Section 11.01 Annual Statement as to Compliance. The Master Servicer
will deliver to each Rating Agency, the Indenture Trustee and the Issuer, on or
before March 31 of each year, beginning with March 31, 20___, a certificate
stating that (a) a review of the activities of the Master Servicer during the
preceding calendar year and of its performance under the Master Servicing
Agreement has been made under the supervision of the officer signing such
certificate and (b) to the best of such officers' knowledge, based on such
review, the Master Servicer has fulfilled all its obligations under the Master
Servicing Agreement throughout such year, or, there has been a default in the
fulfillment of any such obligation, specifying each such default known to such
officer and the nature and status thereof.

        Section 11.02 Annual Independent Public Accountant's Servicing Report.
On or before March 31 of each year, beginning March 31, 20___, the Master
Servicer at its expense shall cause an independent public accountant that is a
member of the American Institute of Certified Public Accountants to furnish a
statement to each Rating Agency, the Issuer and the Indenture Trustee to the
effect that such accountant has examined certain documents and records relating
to the servicing of the Financed Student Loans (during the preceding fiscal
year) under servicing agreements substantially similar one to another and to the
Master Servicing Agreement and that, on the basis of such examination, such
servicing has been conducted in compliance with such servicing agreements except
for such significant exceptions or errors in records that, in the opinion of
such accountant, requires it to report and that are set forth in such report.

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

        Section 11.05 Compliance Certificates and Opinions.

        (a)     Except as otherwise specifically provided in this Indenture or
in any Supplemental Indenture, upon any application or request by the Issuer to
the Indenture Trustee to take any action under any provision of this Indenture,
including, without limitation, any action relating to authentication and
delivery of any Notes, the release or the release and substitution of property
subject to the lien and security interest of this Indenture or in any
Supplemental Indenture or the satisfaction and discharge of this Indenture or in
any Supplemental Indenture, the Issuer shall furnish (i) a certificate stating
that all conditions precedent, if any, provided for in this Indenture relating
to the proposed action have been complied with, (ii) an Opinion of Counsel
stating that in the opinion of such counsel all such conditions precedent, if
any, have been complied with and (iii) if required by the Trust Indenture Act, a
certificate from a firm of independent certified public accountants meeting the
applicable requirements of this Section 11.05, except that, in the case of any
such application or request as to which the furnishing of such documents is
specifically required by any provision of this Indenture or of any Supplemental
Indenture, no additional certificate or opinion need be furnished. Every
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include: (i) a statement that each
signatory of such certificate or opinion has read or has caused to be read such
covenant or condition and the definitions herein relating thereto; (ii) a brief
statement as to the nature and scope of the examination or investigation upon
which the statements or opinions contained in such certificate or opinion are
based; (iii) a statement that, in the opinion of each such signatory, such
signatory has made such examination or investigation as is necessary to enable
such signatory to express an informed opinion as to whether or not such covenant
or condition has been complied with; and (iv) a statement as to whether, in the
opinion of each such signatory, such condition or covenant has been complied
with.

        (b)     Prior to the deposit of any property or securities with the
Indenture Trustee that is to be made the basis for the release of any property
subject to the lien created by this Indenture, the Issuer shall, in addition to
any obligation imposed in Section 11.05(a) or elsewhere in this Indenture or in
any Supplemental Indenture, furnish to the Indenture Trustee (i) a certificate
certifying or stating the opinion of each Person signing such certificate as to
the fair value (within 90 days of such deposit) to the Issuer of the property or
securities to be so deposited, (ii) an Opinion of Counsel either stating that,
in the opinion of such counsel, such action has been taken with respect to the
recording and filing of this Indenture and any other requisite documents, and
with respect to the filing of any financing statements and continuation
statements, as are necessary to perfect and make effective the lien and security
interest in favor of the Indenture Trustee, for the benefit of the Indenture
Trustee, created by this Indenture or by

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any Supplemental Indenture in the property or securities to be so deposited, and
reciting the details of such action, or stating that, in the opinion of such
counsel, no such action is necessary to make such lien and security interest
effective, and (iii) evidence that each of the Rating Agencies then rating any
Outstanding Notes have confirmed that such action will not result in a
reduction, qualification or withdrawal of the then-current rating of any of the
Notes.

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

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

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

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

        (g)     In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be

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certified by, or covered by the opinion of, only one such Person, or that they
be so certified or covered by only one document, but one such Person may certify
or give an opinion with respect to some matters and one or more other such
Persons as to other matters, and any such Person may certify or give an opinion
as to such matters in one or several documents.

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

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

        (j)     Whenever in this Indenture or in any Supplemental Indenture, in
connection with any application or certificate or report to the Indenture
Trustee, it is provided that the Issuer shall deliver any document as a
condition of granting such application, or as evidence of the Issuer's
compliance with any term hereof, it is intended that the truth and accuracy, at
the time of the granting of such application or at the effective date of such
certificate or report, as the case may be, of the facts and opinions stated in
such document shall in such case be conditions precedent to the right of the
Issuer to have such application granted or to the sufficiency of such
certificate or report. The foregoing, shall not, however, be construed to affect
the Indenture Trustee's right to rely upon the truth and accuracy of any
statement or opinion contained in any such document as provided in Article VI.

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

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

        "Commission" shall mean the Commission.

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

        "indenture security holder" shall mean a Noteholder.

        "indenture to be qualified" shall mean this Indenture.

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

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

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

                  [Remainder of page intentionally left blank.]

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

                                         [EDUCATION FUNDING CAPITAL TRUST -__],
                                            by [Name of Co-Owner Trustee], not
                                            in its individual capacity, but
                                            solely as Co-Owner Trustee on behalf
                                            of the Trust

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

                                         [NAME OF INDENTURE TRUSTEE], not in its
                                            individual capacity but solely as
                                            Indenture Trustee

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

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

                                         [NAME  OF TRUST ELIGIBLE LENDER
                                            TRUSTEE], not in its individual
                                            capacity but solely as Trust
                                            Eligible Lender Trustee

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

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

                                         EDUCATION LENDING SERVICES, INC.,
                                         as Master Servicer

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

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                                   APPENDIX A
                              DEFINITIONS AND USAGE

                                      Usage

                                   ----------

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

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

                                   Definitions

                                   ----------

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

        "Accrual Period" with respect to a Series of Auction Rate Notes means,
initially, the period beginning on the Closing Date and ending on the Initial
Auction Date for that Series, and thereafter, the period beginning on an Auction
Rate Distribution Date for that Series and ending on the day before the next
Auction Rate Distribution Date for that Series; "Accrual Period" with respect to
a Series of LIBOR Notes means, initially, the period beginning on the Closing
Date and ending on __________, 20___, the day before the first Quarterly
Distribution Date, and thereafter, the period beginning on a Quarterly
Distribution Date and ending on the day before the next Quarterly Distribution
Date.

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

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

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

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

        "Administration Agreement" means the Administration Agreement dated as
of __________, 20___, between the Issuer and the Administrator.

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

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

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

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

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

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<PAGE>

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

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

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

        "Auction Rate Notes" means the Series A-___ Notes, the Series A-___
Notes, the Series A-___ Notes, the Series A-___ Notes, the Series A-___ Notes
and the Series B-___ Notes.

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

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

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

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

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

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

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<PAGE>

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

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

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

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

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

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

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

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

                                       A-4
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<PAGE>

        "Bailments" means collectively the Bailment Notice and Acknowledgement
dated __________, 20__ among the Trust, the Trust Eligible Lender Trustee, the
Indenture Trustee and _____________, and the Bailment Notice and Acknowledgement
dated __________, 20__ among the Trust, the Trust Eligible Lender Trustee, the
Indenture Trustee and ____________.

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

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

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

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

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

        "Calculation Agent" means __________.

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

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

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

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

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

        "Class A Noteholders' Principal Distribution Amount" means:

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

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

                                       A-6
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

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

        "Class A Notes" means the Series A-___ Notes, the Series A-___ Notes,
the Series A-___ Notes, the Series A-___ Notes, the Series A-___ Notes, the
Series A-___ Notes, the Series A-___ Notes, and the Series A-___ Notes.

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

        "Class B Noteholders' Principal Distribution Amount" means:

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

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

        "Closing Date" means __________, 20___.

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

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

        "Collection Period" means initially the period from the Closing Date
through __________, 20___. Thereafter, a "Collection Period" means (a) while any
LIBOR Notes are Outstanding, the three-month period ending on the ____ day of
May, August, November or February, in each case for the Quarterly Distribution
Date in the following month, and (b) after the date on which no LIBOR Notes
remain Outstanding, the period beginning on the ___ day of each month and ending
on the ___ day of the [same] [following] month.

        "Commission" means the Securities and Exchange Commission.

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

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

        "Co-Owner Trustee" means the [Name of Co-Owner Trustee], not in its
individual capacity, but solely as Co-Owner trustee of the Trust under the Trust
Agreement.

        "Corporate Trust Office" means (i) with respect to the Indenture
Trustee, the principal office of the Indenture Trustee at which at any
particular time its corporate trust business shall be administered, which office
at a Closing Date is located at __________, Attention: Corporate

                                       A-9
                                                              Indenture of Trust

<PAGE>

Trust Administration (telephone: __________; facsimile: __________) or at such
other address as the Indenture Trustee may designate from time to time by notice
to the Noteholders and the Depositor, or the principal corporate trust office of
any successor Indenture Trustee (the address of which the successor Indenture
Trustee will notify the Noteholders and the Depositor) and (ii) with respect to
the Co-Owner Trustee and the Trust Eligible Lender Trustee, the principal
corporate trust offices of the Co-Owner Trustee and the Trust Eligible Lender
Trustee located at __________, Attention: Corporate Trust Administration
(telephone: __________; facsimile: __________) or at such other address as the
Co-Owner Trustee or the Trust Eligible Lender Trustee may designate by notice to
the Depositor or the principal corporate trust office of any successor Co-Owner
Trustee or Trust Eligible Lender Trustee (the address of which the successor
Co-Owner Trustee or Trust Eligible Lender Trustee will notify the Depositor).

        "Counterparty" means any counterparty under a Derivative Product.

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

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

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

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

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

        (b)     with respect to a certificated security:

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

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

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

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

        (c)     with respect to an uncertificated security:

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

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                                                              Indenture of Trust

<PAGE>

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

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

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

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

        (e)     with respect to a security entitlement:

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

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

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

                (i)     with respect to a certificated security:

                        (A)     the Indenture Trustee acquires possession
                                thereof;

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

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

                (ii)    with respect to an uncertificated security:

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

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

                                      A-11
                                                              Indenture of Trust

<PAGE>

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

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

                (i)     "certificated security"

                (ii)    "effective endorsement"

                (iii)   "entitlement holder"

                (iv)    "instrument"

                (v)     "securities account"

                (vi)    "securities entitlement"

                (vii)   "securities intermediary"

                (viii)  "uncertificated security"

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

        "Depositor" means Education Funding Capital I, LLC.

        "Depositor Eligible Lender Trust Agreement" means the Eligible Lender
Trust Agreement dated as of __________, 20___ between the Depositor and the
Depositor Eligible Lender Trustee.

        "Depositor Eligible Lender Trustee" means [Name of Depositor Eligible
Lender Trustee], a __________ organized under the laws of the __________, not in
its individual capacity but solely Depositor Eligible Lender Trustee under the
Depositor Eligible Lender Trust Agreement.

        "Depositor Transfer and Sale Agreement" means the Transfer and Sale
Agreement dated as of __________, 20___ among the Depositor, the Depositor
Eligible Lender Trustee, the Issuer and the Trust Eligible Lender Trustee.

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

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

                                      A-12
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

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

                                      A-13
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

                                      A-14
                                                              Indenture of Trust

<PAGE>

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

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

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

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

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

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

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

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

                                      A-15
                                                              Indenture of Trust

<PAGE>

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

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

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

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

        "Fitch" means Fitch Ratings or any successor thereto.

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

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

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

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

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

        "Indenture" means the Indenture of Trust dated as of __________, 20___
among the Issuer, the Trust Eligible Lender Trustee and the Indenture Trustee,
as amended and supplemented from time to time.

                                      A-16
                                                              Indenture of Trust

<PAGE>

        "Indenture Trustee" means [Name of Indenture Trustee], a __________
organized under the laws of the __________, not in its individual capacity but
solely as Indenture Trustee under the Indenture.

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

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

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

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

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

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

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

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

        "LIBOR Notes" means the Series A-___ Notes, the Series A-___ Notes, and
the Series A-___ Notes.

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

        "Master Servicer" means Education Lending Services, Inc., in its
capacity as servicer of the Financed Student Loans, or any permitted successor
Master Servicer, under the Master Servicing Agreement.

                                      A-17
                                                              Indenture of Trust

<PAGE>

        "Master Servicer Default" means an event specified as such in the Master
Servicing Agreement.

        "Master Servicing Agreement" means, collectively, (i) the Master
Servicing Agreement dated as of __________, 20___, as supplemented and amended
from time to time, among the Issuer, the Trust Eligible Lender Trustee, the
Master Servicer and the Indenture Trustee, and (ii) the Subservicing Agreement.

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

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

        "Minimum Purchase Amount" means an amount sufficient to:

        (i)     reduce the outstanding principal amount of each Series of Notes
                then outstanding on the related Distribution Date to zero;

        (ii)    pay to Noteholders the interest payable on the related
                Distribution Date;

        (iii)   pay all remaining Issuer Derivative Payments then due or to
                become due under Derivative Products payable on a parity with
                any Series of the Class A Notes or the Class B Notes; and

        (iv)    in the case of Auction Rate Notes, pay any Carry-over Amounts
                and interest on Carry-over Amounts.

        "Monthly Allocation Date" means the _____ day of each calendar month.

        "Monthly Expense Payment Date" means the _____ day of each calendar
month.

        "Monthly Issuer Fees" means the fees of each Subservicer, the Indenture
Trustee, the Trust Eligible Lender Trustee, the Owner Trustee, the Auction
Agent, each Broker-Dealer, the Master Servicer and the Administrator.

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

        "Note Counsel" means counsel to the Issuer.

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

                                      A-18
                                                              Indenture of Trust

<PAGE>

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

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

        "Notes" means, collectively, the Class A Notes and the Class B Notes.

        "Obligations" means Senior Obligations and Subordinate Obligations.

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

        "Other Issuer Termination Payments" with respect to a Derivative Product
means one or more payments required to be made by the Issuer to the Counterparty
thereunder in respect of early termination of the Derivative Product; excluding,
however, Specified Issuer Termination Payments.

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

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

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

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

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

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

                                      A-19
                                                              Indenture of Trust

<PAGE>

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

        "Pool Balance" for any date means the aggregate principal balance of the
Financed Student Loans on that date, including accrued interest that is expected
to be capitalized, as reduced by the amount attributable to principal from the
following:

        (i)     all payments received by the Issuer through that date from
                borrowers, the Guarantee Agencies and the Department;

        (ii)    all amounts received by the Issuer through that date from
                purchases of the Financed Student Loans by the Seller, the
                Depositor or the Master Servicer;

        (iii)   all liquidation proceeds and Realized Losses on the Financed
                Student Loans liquidated through that date;

        (iv)    the amount of any adjustments to balances of the Financed
                Student Loans that the Master Servicer makes under the Master
                Servicing Agreement through that date; and

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

        "Pool Factor" with respect to a Series of Notes means, as of any date, a
seven-digit decimal figure equal to the Outstanding Amount of that Series of
Notes as of the close of business on such date divided by the initial
Outstanding Amount of that Series of Notes. The Pool Factor for each Series of
Notes will be 1.0000000 as of the Closing Date; thereafter, the Pool Factor will
decline to reflect reductions in the Outstanding Amount of that Series of Notes.

        "Principal Distribution Amount" means:

        (i)     as to the initial Distribution Date, the amount by which the
                initial Pool Balance exceeds the Pool Balance on that
                Distribution Date plus any amounts transferred from the
                Acquisition Account to the Collection Account during the initial
                Collection Period, and

        (ii)    as to each subsequent Distribution Date, the amount by which the
                Pool Balance for the preceding Distribution Date exceeds the
                Pool Balance on that Distribution Date.

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

        "Program Expenses" means (a) the fees and expenses of the Indenture
Trustee, the Owner Trustee and the Co-Owner Trustee; (b) the fees and expenses
of any auction agent, any market

                                      A-20
                                                              Indenture of Trust

<PAGE>

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

        "Quarterly Distribution Date" means the ___ day of each March, June,
September and December, beginning __________, 20___; provided, however, if any
March ___, June ___, September ___ or December ___ is not a Business Day, the
Quarterly Distribution Date shall be the next Business Day.

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

        "Rating Agency" means Fitch, Moody's and S&P. If no such organization or
successor is any longer in existence, "Rating Agency" shall be a nationally
recognized statistical rating organization or other comparable Person designated
by the Seller, notice of which designation shall be given to the Indenture
Trustee, the Trust Eligible Lender Trustee and the Master Servicer.

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

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

        "Realized Loss" means the excess of the principal balance, including any
interest that had been or had been expected to be capitalized, of any liquidated
Financed Student Loan over

                                      A-21
                                                              Indenture of Trust

<PAGE>

liquidation proceeds for a Financed Student Loan to the extent allocated to
principal, including any interest that had been or had been expected to be
capitalized.

        "Record Date" means:

        (a)     for the LIBOR Notes, the ___ day before the related Distribution
                Date; and

        (b)     for the Auction Rate Notes,

                (i)     for payments of interest at the applicable interest rate
                        and for payments of principal, ___ Business Days before
                        the related Distribution Date, and

                (ii)    for payments of Carry-over Amounts and interest accrued
                        thereon, the record date relating to the Distribution
                        Date for which the Carry-over Amount accrued.

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

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

        "Required Parity Percentage" means _____%; provided, however, that the
Required Parity Percentage may be reduced upon receipt of a Rating Confirmation.

        "Required Senior Parity Percentage" means _____%; provided, however,
that the Required Senior Parity Percentage may be reduced upon receipt of a
Rating Confirmation.

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

        "Reserve Account Requirement" for any Distribution Date means the
greater of (a) _____% of the Outstanding balance of the Notes, and (b) $_____;
provided, however, that if the Senior Parity Percentage is at least _____% and
the Parity Percentage is at least _____% on any Distribution Date, the Reserve
Account Requirement for such Distribution Date shall be equal to the greater of
(c) _____% of the Outstanding balance of all of the Notes, and (d) $_____. In no
event will the Reserve Account Requirement exceed the Outstanding balance of all
of the Notes.

        "Responsible Officer" with respect to the Indenture Trustee, any officer
assigned to the Corporate Trust Office of the Indenture Trustee, including any
managing director, principal, vice president, assistant vice president,
assistant treasurer, assistant secretary, trust officer or any other officer of
the Indenture Trustee customarily performing functions similar to those

                                      A-22
                                                              Indenture of Trust

<PAGE>

performed by any of the above designated officers and having direct
responsibility for the administration of the Indenture, and also, with respect
to a particular matter, any other officer, to whom such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.

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

        "S&P" means Standard & Poor's, a division of the McGraw-Hill Companies.

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

        "Scheduled Issuer Derivative Payments" with respect to a Derivative
Product means one or more payments required to be made by or on behalf of the
Issuer to the Counterparty thereunder on scheduled and specified Derivative
Payment Dates.

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

        "Securities Act" means the federal Securities Act of 1933, as amended.

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

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

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

        "Seller Eligible Lender Trust Agreement" means the Eligible Lender Trust
Agreement dated as of __________, 20___ between the Seller and the Seller
Eligible Lender Trustee.

                                      A-23
                                                              Indenture of Trust

<PAGE>

        "Seller Eligible Lender Trustee" means [Name of Seller Eligible Lender
Trustee], a __________ organized under the laws of the __________, not in its
individual capacity but solely Seller Eligible Lender Trustee under the Seller
Eligible Lender Trust Agreement.

        "Seller Transfer and Sale Agreement" means Transfer and Sale Agreement
dated as of __________, 20___ among the Seller, the Seller Eligible Lender
Trustee, the Depositor and the Depositor Eligible Lender Trustee.

        "Senior Obligations" means Class A Notes and any Derivative Product, the
priority of payment of which is equal with that of Class A Notes.

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

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

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series A-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series A-___.

        "Series B-___ Notes" means the $__________ [Education Funding Capital
Trust -__], Education Loan Backed Notes, Series B-___.

                                      A-24
                                                              Indenture of Trust

<PAGE>

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

        "Special Record Date" means the date established by the Indenture
Trustee pursuant to Section 1.01 of the Indenture.

        "Specified Issuer Termination Payments" with respect to a Derivative
Product means one or more payments required to be made by the Issuer to the
Counterparty thereunder in respect of early termination of the Derivative
Product upon the occurrence of certain events specified in the Schedule to the
Derivative Product.

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

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

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

        "Subaccount" means any of the subaccounts that may be created and
established within any Account pursuant to Section 4.01 of the Indenture.

        "Subordinate Obligations" means Class B Notes and any Derivative
Product, the priority of payment of which is equal with that of Class B Notes.

        "Subservicer" means [Name of Subservicer], in its capacity as a
subservicer of the Financed Student Loans, and/or any other permitted
subservicer, under the Master Servicing Agreement.

        "Subservicing Agreement" means collectively [list each Subservicing
Agreement].

        "Transfer and Sale Agreements" means collectively the Seller Transfer
and Sale Agreement and the Depositor Transfer and Sale 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.

        "Trust" means [Education Funding Capital Trust -__], formed pursuant to
the Trust Agreement.

                                      A-25
                                                              Indenture of Trust

<PAGE>

        "Trust Accounts" shall have the meaning given such term in Section 4.01
of the Indenture.

        "Trust Account Property" means the Trust Accounts, all amounts and
investments held from time to time in any Trust Account (whether in the form of
deposit accounts, Physical Property, book-entry securities, uncertificated
securities or otherwise), including the Reserve Account, the Distribution
Account, the Capitalized Interest Account, the Acquisition Account and the
Collection Account and all proceeds of the foregoing.

        "Trust Agreement" means the Trust Agreement dated as of __________,
20___ among the Depositor, the Owner Trustee and the Co-Owner Trustee, as
amended and restated in its entirety by the Amended and Restated Trust Agreement
dated as of __________, 20___ among the Depositor, the Owner Trustee and the
Co-Owner Trustee, and acknowledged and agreed to by the Trust Eligible Lender
Trustee, as the same may be further amended from time to time.

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

        "Trust Eligible Lender Trust Agreement" means the Eligible Lender Trust
Agreement dated as of __________, 20___ between the Issuer and the Trust
Eligible Lender Trustee.

        "Trust Eligible Lender Trustee" means [Name of Trust Eligible Lender
Trustee], a __________ organized under the laws of the __________, not in its
individual capacity but solely as Trust Eligible Lender Trustee under the Trust
Eligible Lender Trust Agreement.

        "Trust Estate" means all right, title and interest of the Trust (or the
Co-Owner Trustee or Trust Eligible Lender Trustee on behalf of the Trust) in and
to the property and rights assigned to the Trust pursuant to Article I of the
Depositor Transfer and Sale Agreement, all funds on deposit from time to time in
the Trust Accounts and all other property of the Trust from time to time,
including any rights of the Trust pursuant to the Depositor Transfer and Sale
Agreement, the Master Servicing Agreement and the Administration Agreement.

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

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

        "Underwriters" means __________ and __________.

        "Underwriting Agreement" means the Underwriting Agreement dated
__________, 20___ between the Issuer and the Underwriters.

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

                                      A-26
                                                              Indenture of Trust

<PAGE>

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

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

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

        (d)     as to investments the bid and asked prices of which are
                published on a regular basis in The Wall Street Journal (or, if
                not there, then in The New York Times), the average of the bid
                and asked prices for such investments so published on or most
                recently prior to such time of determination; and

        (e)     as to investments the bid and asked prices of which are not
                published on a regular basis in The Wall Street Journal or The
                New York Times: (i) the lower of the bid prices at such time of
                determination for such investments by any two nationally
                recognized government securities dealers (selected by the Issuer
                in its absolute discretion) at the time making a market in such
                investments or (ii) the bid price published by a nationally
                recognized pricing service.

                                      A-27
                                                              Indenture of Trust

<PAGE>

                                   APPENDIX B

                         CERTAIN TERMS AND PROVISIONS OF
                             THE AUCTION RATE NOTES

                                    ARTICLE I

                                   DEFINITIONS

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

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

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

        "Auction" means the implementation of the Auction Procedures on an
Auction Date.

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

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

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

        "Auction Date" means, initially, __________, 20___ with respect to the
Series A-___ Notes, __________, 20___ with respect to the Series A-___ Notes,
__________, 20___ with respect to the Series A-___ Notes, __________, 20___ with
respect to the Series A-___ Notes, __________, 20___ with respect to the Series
A-___ Notes, __________, 20___ with respect to the Series B-___ Notes, and
thereafter, the Business Day immediately preceding the first day of each Auction
Period for each respective Series, other than:

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

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

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

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

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

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

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

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

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

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

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

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

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

        "Book-entry Form" or "Book-entry System" means a form or system under
which (a) the beneficial right to principal and interest may be transferred only
through a book entry, (b) physical securities in registered form are issued only
to a Securities Depository or its nominee as Noteholder, with the securities
"immobilized" to the custody of the Securities

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Depository, and (c) the book entry is the record that identifies the owners of
beneficial interests in that principal and interest.

        "Broker-Dealers" means __________ (with respect to the Series ___
Notes), __________ (with respect to the Series ___ Notes), and any other broker
or dealer (each as defined in the Securities Exchange Act of 1934, as amended),
commercial bank or other entity permitted by law to perform the functions
required of a Broker-Dealer set forth in the Auction Procedures that (a) is a
Participant (or an affiliate of a Participant), (b) has been appointed as such
by the Issuer pursuant to Section 2.02(f) of this Appendix B, and (c) has
entered into a Broker-Dealer Agreement that is in effect on the date of
reference.

        "Broker-Dealer Agreements" means the agreements between the Auction
Agent and the Broker-Dealers, and approved by the Issuer, pursuant to which the
Broker-Dealers agree to participate in Auctions as set forth in the Auction
Procedures, as from time to time amended or supplemented. The Broker-Dealer
Agreements shall be in substantially the form of each Broker-Dealer Agreement
dated as of __________, 20___, among the Issuer, the Auction Agent, and each
respective Broker-Dealer.

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

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

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

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

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

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(b) plus all accrued Interest Benefit Payments and Special Allowance Payments
applicable to such Financed Student Loan during such calendar quarter expressed
as a percentage per annum.

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

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

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

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

        "Initial Auction Agent" means __________, a __________, and its
successors and assigns.

        "Initial Auction Agent Agreement" means the Auction Agent Agreement
dated as of __________, 20___, by and among the Issuer, the Indenture Trustee
and the Initial Auction Agent, including any amendment thereof or supplement
thereto.

        "Initial Payment Dates" means, with respect to the Series A-___ Notes,
__________, 20___; with respect to the Series A-___ Notes, __________, 20___;
with respect to the Series A-___ Notes, __________, 20___; with respect to the
Series A-___ Notes, __________, 20___; with respect to the Series A-___ Notes,
__________, 20___; and with respect to the Series B-___ Notes, __________,
20___.

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

        "Initial Rate" means ___% for the Series A-___ Notes, ___% for the
Series A-___ Notes, ___% for the Series A-___ Notes, ___% for the Series A-___
Notes, ___% for the Series A-___ Notes, and ___% for the Series B-___ Notes.

        "Initial Rate Adjustment Date" means, with respect to the Series A-___
Notes, __________, 20___; with respect to the Series A-___ Notes, __________,
20___; with respect to

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the Series A-___ Notes, __________, 20___; with respect to the Series A-___
Notes, __________, 20___; with respect to the Series A-___ Notes, __________,
20___; and with respect to the Series B-___ Notes, __________, 20___.

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

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

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

        "Market Agent" means __________

        "Market Agent Agreement" means the Market Agent Agreement dated as of
__________, 20___ among the Market Agent, the Issuer and the Indenture Trustee,
as the same may be amended from time to time.

        "Maximum Rate" means the least of (a) either (i) the Applicable LIBOR
Rate plus _____% (if the ratings assigned by Fitch, Moody's and S&P to the
Auction Rate Notes are "AA-", "Aa3" and "AA-", respectively, or better) or (ii)
the Applicable LIBOR Rate plus _____% (if any one of the ratings assigned by
Fitch, Moody's and S&P to the Auction Rate Notes is less than "AA-", "Aa3" and
"AA-", respectively, and greater than or equal to "A-", "A" and "A",
respectively), or (iii) the Applicable LIBOR Rate plus _____% (if any one of the
ratings assigned by Fitch, Moody's and S&P to the Auction Rate Notes is less
than "A-", "A" and "A-", respectively), and (b) the highest rate the Issuer may
legally pay, from time to time, as interest on the Auction Rate Notes. For
purposes of the Auction Agent and the Auction Procedures, the ratings referred
to in this definition shall be the last ratings of which the Auction Agent has
been given written notice pursuant to the Auction Agent Agreement.

        "Net Loan Rate" means, with respect to any Interest Period applicable to
the Auction Rate Notes, the rate of interest per annum (rounded to the next
highest one-hundredth of one percent) equal to (a) the weighted average
Effective Interest Rate of the Financed Student Loans for the calendar quarter
immediately preceding such Interest Period, as determined by the Administrator
on the last day of such calendar quarter, less (b) the sum of (i) the Program
Expense Percentage, as determined by the Administrator on the last day of each
calendar quarter and (ii) net losses realized on the Financed Student Loans
during the calendar quarter immediately preceding such Interest Period, as
determined by the Administrator on the last day of such calendar quarter,
expressed as a percentage of the principal balance of the Financed Student Loans
outstanding on the last day of such calendar quarter. In making the
determinations in (a) and (b) of this definition of "Net Loan Rate," the
Administrator shall take

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into account as an increase to such Net Loan Rate the receipt of any
Counterparty Derivative Payment and as a decrease to such Net Loan Rate any
Issuer Derivative Payment. The determinations made by the Administrator in (a)
and (b) of this definition of "Net Loan Rate" shall be given in writing to the
Auction Agent, the Indenture Trustee and the Broker-Dealers immediately upon
their respective calculation dates.

        "Non-Payment Rate" means ___-Month LIBOR plus ___%.

        "One-Month LIBOR", "Two-Month LIBOR", "Three-Month LIBOR", "Six-Month
LIBOR" or "One-Year LIBOR" means the rate per annum for London Interbank Offered
Rates on U.S. dollar deposits as it appears on Telerate Page 3750 as of 11:00
a.m., London Time for the Applicable LIBOR Rate, as determined by the Auction
Agent or Indenture Trustee, as applicable, on the related LIBOR Determination
Date. If such a day is not a business day in London, the most recently fixed
London Interbank Offered Rates on U.S. dollar deposits for the Applicable LIBOR
Rate shall be used. The LIBOR Determination Date will be the second business day
before the beginning of each Accrual Period. If this rate does not appear on
Telerate Page 3750, the rate for that day will be determined on the basis of the
rates at which deposits in U.S. dollars, having the relevant maturity and in a
principal amount of not less than U.S. $1,000,000, are offered at approximately
11:00 a.m., London time, on that LIBOR Determination Date, to prime banks in the
London interbank market by four major banks selected by the Auction Agent or the
Indenture Trustee. The Auction Agent or the Indenture Trustee will require the
principal London office of each bank to provide a quotation of its rate. If the
banks provide at least two quotations, the rate for that day will be the
arithmetic mean of the quotations. If the banks provide fewer than two
quotations, the rate for that day will be the arithmetic mean of the rates
quoted by major banks in New York City, selected by the Auction Agent or the
Indenture Trustee, at approximately 11:00 a.m., New York time, on that LIBOR
Determination Date, for loans in U.S. Dollars to leading European banks having
the relevant maturity and in a principal amount of not less than U.S.
$1,000,000. If the banks selected as described above are not providing
quotations, the Applicable LIBOR Rate in effect for the applicable Accrual
Period will be the Applicable LIBOR Rate in effect for the previous Accrual
Period. All percentages resulting from such calculations shall be rounded
upwards, if necessary, to the nearest one-hundredth of one percent.

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

        "Payment Date" means, initially with respect to each Series of the
Auction Rate Notes, the applicable Initial Payment Dates and, thereafter (a) so
long as a Series of the Auction Rate Notes bears interest at an Auction Note
Interest Rate for an Interest Period of not greater than ___ days, the Business
Day immediately following the expiration of the related Auction Period
thereafter and (b) if and for so long as a Series of Auction Rate Notes bears
interest at an Auction Note Interest Rate for an Interest Period of greater than
___ days, (i) the ____ day of each March, June, September and December unless
any March ___, June ___, September ___ or December ___ is not a Business Day,
then the Payment Date will be the next Business Day, and (ii) the Business Day
immediately following the expiration of the Auction Period for that Series of
Auction Rate Notes.

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        "Payment Default" means, with respect to the Auction Rate Notes, (a) a
default in the due and punctual payment of any installment of interest on such
Auction Rate Notes, or (b) a default in the due and punctual payment of any
interest on and principal of such Auction Rate Notes at their maturity.

        "Potential Owner" means any Person (including an Existing Owner that is
(a) a Broker-Dealer when dealing with the Auction Agent and (b) a potential
beneficial owner when dealing with a Broker-Dealer) who may be interested in
acquiring Auction Rate Notes (or, in the case of an Existing Owner thereof, an
additional principal amount of Auction Rate Notes).

        "Program Expense Percentage" means, the percentage that all Program
Expenses (other than Consolidation Loan rebate fees) estimated for the next 12
months represent of the outstanding principal balance of the Financed Student
Loans, which as of the Closing Date is _____%, and which the Administrator shall
calculate on the last day of each calendar quarter. Any adjustment in the
Program Expense Percentage shall be effective beginning on the first Interest
Rate Determination Date following each such calculation.

        "Regular Record Date" means, with respect to each Payment Date, the
Business Day immediately preceding such Payment Date.

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

        "Submission Deadline" means 1:00 p.m., eastern time, on any Auction Date
or such other time on any Auction Date by which the Broker-Dealers are required
to submit Orders to the Auction Agent as specified by the Auction Agent from
time to time.

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

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

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

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

        "Substitute Auction Agent" means the Person with whom the Issuer and the
Indenture Trustee enter into a Substitute Auction Agent Agreement.

        "Substitute Auction Agent Agreement" means an auction agent agreement
containing terms substantially similar to the terms of the Initial Auction Agent
Agreement, whereby a Person having the qualifications required by Section
2.02(e) of this Appendix B agrees with the Indenture Trustee and the Issuer to
perform the duties of the Auction Agent under this Appendix B.

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

                                   ARTICLE II

                               TERMS AND ISSUANCE

        Section 2.01 Auction Rate and Carry-over Amounts. During the Initial
Period, each Series of Auction Rate Notes shall bear interest at the Initial
Rate for such Series. Thereafter, and except with respect to an Auction Period
Adjustment, the Auction Rate Notes shall bear interest at an Auction Note
Interest Rate based on a ___-day Auction Period for the Auction Rate Notes, as
determined pursuant to this Section 2.01 and Section 2.02 of this Appendix B.

        For the Auction Rate Notes during the Initial Period and each Auction
Period thereafter, interest at the applicable Auction Note Interest Rate shall
accrue daily and shall be computed for the actual number of days elapsed on the
basis of a year consisting of ___ days.

        The Auction Note Interest Rate to be borne by the Auction Rate Notes
after such Initial Period for each Auction Period until an Auction Period
Adjustment, if any, shall be determined as described below. Each such Auction
Period after the Initial Period shall commence on and include the day following
the expiration of the immediately preceding Auction Period and terminate on and
include (i) the ___ Business Day of the following _____ week in the case of the
Series ___ Notes and the Series ___ Notes, (ii) the ___ Business Day of the
following _____ week in the case of the Series ___ Notes, and (iii) the ___
Business Day of the following _____ week in the case of the Series ___ Notes;
provided, however, that in the case of the Auction Period that immediately
follows the Initial Period for the Auction Rate Notes, such Auction Period shall
commence on the Initial Rate Adjustment Date. The Auction Note Interest Rate of
the Auction Rate Notes for each Auction Period shall be the Auction Rate in
effect for such Auction Period as determined in accordance with Section 2.02(a)
of this Appendix B; provided that, if on any Interest Rate Determination Date,
an Auction is not held for any reason, the following Business Day shall be
considered the Interest Rate Determination Date and an Auction is to be held on
such date. If an Auction is not held for any reason on such date, then the
Auction Note Interest Rate on such Auction Rate Notes for the next succeeding
Auction Period shall be the applicable Cap Rate.

        Notwithstanding the foregoing:

                (a)     if the ownership of an Auction Rate Note is no longer
        maintained in Book-entry Form, the Auction Note Interest Rate on the
        Auction Rate Notes for any Interest Period commencing after the delivery
        of certificates representing Auction Rate Notes pursuant to the
        Indenture shall equal the Cap Rate; or

                (b)     if a Payment Default shall have occurred, the Auction
        Note Interest Rate on the Auction Rate Notes for the Interest Period
        commencing on or immediately after such Payment Default, and for each
        Interest Period thereafter, to and including the Interest Period, if
        any, during which, or commencing less than two Business Days after,

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        such Payment Default is cured, shall equal the applicable Non-Payment
        Rate on the first day of each such Interest Period.

        In accordance with Section 2.02(a)(iii)(B) and (C) of this Appendix B,
the Auction Agent shall promptly give written notice to the Indenture Trustee
and the Issuer of each Auction Note Interest Rate (unless the Auction Note
Interest Rate is the applicable Non-Payment Rate) and the Maximum Rate when such
rate is not the Auction Note Interest Rate, applicable to the Auction Rate
Notes. The Indenture Trustee shall, upon request, notify the Noteholders and the
Issuer of Auction Rate Notes of the applicable Auction Note Interest Rate
applicable to such Auction Rate Notes for each Auction Period not later than the
third Business Day of such Auction Period. Notwithstanding any other provision
of the Auction Rate Notes or the Indenture and except for the occurrence of a
Payment Default, interest payable on the Auction Rate Notes for an Auction
Period shall never exceed for such Auction Period the amount of interest payable
at the applicable Maximum Rate in effect for such Auction Period.

        If the Auction Rate for the Auction Rate Notes is greater than the Net
Loan Rate, then the Auction Note Interest Rate applicable to such Auction Rate
Notes for that Interest Period will be the Net Loan Rate and the Issuer shall
determine the Carry-over Amount, if any, with respect to such Auction Rate Notes
for such Interest Period.

        Such Carry-over Amount shall bear interest calculated at a rate equal to
One-Month LIBOR (as determined by the Indenture Trustee) from the Payment Date
for the Interest Period with respect to which such Carry-over Amount was
calculated, until paid. Any payment in respect of Carry-over Amount shall be
applied, first, to any accrued interest payable thereon and, second, in
reduction of such Carry-over Amount. For purposes of the Indenture and this
Appendix B, any reference to "principal" or "interest" herein shall not include
within the meaning of such words Carry-over Amount or any interest accrued on
any such Carry-over Amount. Such Carry-over Amount shall be separately
calculated for each Auction Rate Note by the Issuer during such Interest Period
in sufficient time for the Indenture Trustee to give notice to each Noteholder
of such Carry-over Amount as required in the next succeeding sentence. Not less
than four days before the Payment Date for an Interest Period with respect to
which such Carry-over Amount has been calculated by the Issuer, the Indenture
Trustee shall give written notice to each Noteholder, the Auction Agent and the
Issuer, in the form provided by the Issuer, of the Carry-over Amount applicable
to each Auction Rate Note, which written notice may accompany the payment of
interest made to the Noteholder on such Payment Date. Such notice shall state,
in addition to such Carry-over Amount, that, unless and until an Auction Rate
Note has been redeemed (other than by optional redemption), after which all
accrued Carry-over Amounts (and all accrued interest thereon) that remains
unpaid shall be canceled and no Carry-over Amount (and interest accrued thereon)
shall be paid with respect to such Auction Rate Note, (a) the Carry-over Amount
(and interest accrued thereon calculated at a rate equal to ___-Month LIBOR)
shall be paid by the Indenture Trustee pursuant to an Issuer Order on an Auction
Rate Note on the earliest of (i) the date of defeasance of any of the Auction
Rate Notes or (ii) the first occurring Payment Date with respect to the Auction
Rate Note (or on the date of any such optional redemption) if and to the extent
that (A) the Eligible Carry-over Make-up Amount with respect to such subsequent
Interest Period is greater than zero, and (B) moneys are available pursuant to
the terms of the Indenture in an amount sufficient to pay all or a portion of
such

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Carry-over Amount (and interest accrued thereon), and (b) interest shall accrue
on the Carry-over Amount at a rate equal to One-Month LIBOR until such
Carry-over Amount is paid in full or is cancelled.

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

        The Payment Date or other date on which such Carry-over Amount (or any
interest accrued thereon) for Auction Rate Notes shall be paid shall be
determined by the Indenture Trustee in accordance with the provisions of the
immediately preceding paragraph and the Indenture, and the Indenture Trustee
shall make payment of the Carry-over Amount (and any interest accrued thereon)
in the same manner as, and from the same Trust Account from which, it pays
interest on the Auction Rate Notes on a Payment Date. Any payment of Carry-over
Amounts (and interest accrued thereon) shall reduce the amount of Eligible
Carry-over Make-up Amount.

        In the event that the Auction Agent no longer determines, or fails to
determine, when required, the Auction Note Interest Rate with respect to Auction
Rate Notes, or, if for any reason such manner of determination shall be held to
be invalid or unenforceable, the Auction Note Interest Rate for the next
succeeding Interest Period, which Interest Period shall be an Auction Period,
for Auction Rate Notes shall be the applicable Cap Rate as determined by the
Auction Agent for such next succeeding Auction Period, and if the Auction Agent
shall fail or refuse to

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determine the Cap Rate, the Cap Rate shall be determined by the securities
dealer appointed by the Issuer capable of making such a determination in
accordance with the provisions of this Appendix B and written notice of such
determination shall be given by such securities dealer to the Indenture Trustee.

        Section 2.02 Auction Rate.

        (a)     Determining the Auction Rate. By purchasing Auction Rate Notes,
whether in an Auction or otherwise, each purchaser of Auction Rate Notes, or its
Broker-Dealer, must agree and shall be deemed by such purchase to have agreed
(x) to participate in Auctions on the terms described herein, (y) to have its
beneficial ownership of the Auction Rate Notes maintained at all times in
Book-entry Form for the account of its Participant, which in turn will maintain
records of such beneficial ownership, and (z) to authorize such Participant to
disclose to the Auction Agent such information with respect to such beneficial
ownership as the Auction Agent may request.

        So long as the ownership of Auction Rate Notes is maintained in
Book-entry Form by the Securities Depository, an Existing Owner may sell,
transfer or otherwise dispose of Auction Rate Notes only pursuant to a Bid or
Sell Order placed in an Auction or otherwise sell, transfer or dispose of
Auction Rate Notes through a Broker-Dealer; provided that, in the case of all
transfers other than pursuant to Auctions, such Existing Owner, its
Broker-Dealer or its Participant advises the Auction Agent of such transfer.

        Auctions shall be conducted on each Auction Date, if there is an Auction
Agent on such Auction Date, in the following manner:

        (i)     (A)     Prior to the Submission Deadline on each Auction Date;

                        (1)     each Existing Owner of Auction Rate Notes may
                submit to a Broker-Dealer by telephone or otherwise any
                information as to:

                                a.      the principal amount of Outstanding
                        Auction Rate Notes, if any, owned by such Existing Owner
                        that such Existing Owner desires to continue to own
                        without regard to the Auction Note Interest Rate for the
                        next succeeding Auction Period;

                                b.      the principal amount of Outstanding
                        Auction Rate Notes, if any, that such Existing Owner
                        offers to sell if the Auction Note Interest Rate for the
                        next succeeding Auction Period shall be less than the
                        rate per annum specified by such Existing Owner; and/or

                                c.      the principal amount of Outstanding
                        Auction Rate Notes, if any, owned by such Existing Owner
                        that such Existing Owner offers to sell without regard
                        to the Auction Note Interest Rate for the next
                        succeeding Auction Period;

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                        and

                        (2)     one or more Broker-Dealers may contact Potential
                Owners to determine the principal amount of Auction Rate Notes
                that each Potential Owner offers to purchase, if the Auction
                Note Interest Rate for the next succeeding Auction Period shall
                not be less than the rate per annum specified by such Potential
                Owner.

        The statement of an Existing Owner or a Potential Owner referred to in
(1) or (2) of this paragraph (A) is herein referred to as an "Order," and each
Existing Owner and each Potential Owner placing an Order is herein referred to
as a "Bidder"; an Order described in clause (1)a. is herein referred to as a
"Hold Order"; an Order described in clauses (1)b. and (2) is herein referred to
as a "Bid"; and an Order described in clause (1)c. is herein referred to as a
"Sell Order."

                (B)     (1)     Subject to the provisions of Section 2.02(a)(ii)
        of this Appendix B, a Bid by an Existing Owner shall constitute an
        irrevocable offer to sell:

                                        a.      the principal amount of
                                Outstanding Auction Rate Notes specified in such
                                Bid if the Auction Note Interest Rate determined
                                as provided in this Section 2.02(a) shall be
                                less than the rate specified therein; or

                                        b.      such principal amount, or a
                                lesser principal amount of Outstanding Auction
                                Rate Notes to be determined as set forth in
                                Section 2.02(a)(iv)(A)(4) of this Appendix B, if
                                the Auction Note Interest Rate determined as
                                provided in this Section 2.02(a) shall be equal
                                to the rate specified therein; or

                                        c.      such principal amount, or a
                                lesser principal amount of Outstanding Auction
                                Rate Notes to be determined as set forth in
                                Section 2.02(a)(iv)(B)(3) of this Appendix B, if
                                the rate specified therein shall be higher than
                                the applicable Maximum Rate and Sufficient Bids
                                have not been made.

                        (2)     Subject to the provisions of Section 2.02(a)(ii)
                of this Appendix B, a Sell Order by an Existing Owner shall
                constitute an irrevocable offer to sell:

                                        a.      the principal amount of
                                Outstanding Auction Rate Notes specified in such
                                Sell Order; or

                                        b.      such principal amount, or a
                                lesser principal amount of Outstanding Auction
                                Rate Notes set forth in Section
                                2.02(a)(iv)(B)(3) of this Appendix B, if
                                Sufficient Bids have not been made.

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                        (3)     Subject to the provisions of Section 2.02(a)(ii)
                of this Appendix B, a Bid by a Potential Owner shall constitute
                an irrevocable offer to purchase:

                                a.      the principal amount of Outstanding
                        Auction Rate Notes specified in such Bid if the Auction
                        Note Interest Rate determined as provided in this
                        Section 2.02(a) shall be higher than the rate specified
                        in such Bid; or

                                b.      such principal amount, or a lesser
                        principal amount of Outstanding Auction Rate Notes set
                        forth in Section 2.02(a)(iv)(A)(5) of this Appendix B,
                        if the Auction Note Interest Rate determined as provided
                        in this Section 2.02(a) shall be equal to the rate
                        specified in such Bid.

                (ii)    (A)     Each Broker-Dealer shall submit in writing to
        the Auction Agent prior to the Submission Deadline on each Auction Date
        all Orders obtained by such Broker-Dealer and shall specify with respect
        to each such Order:

                        (1)     the name of the Bidder placing such Order;

                        (2)     the aggregate principal amount of Auction Rate
                Notes that are the subject of such Order;

                        (3)     to the extent that such Bidder is an Existing
                                Owner:

                                        a.      the principal amount of Auction
                                Rate Notes, if any, subject to any Hold Order
                                placed by such Existing Owner;

                                        b.      the principal amount of Auction
                                Rate Notes, if any, subject to any Bid placed by
                                such Existing Owner and the rate specified in
                                such Bid; and

                                        c.      the principal amount of Auction
                                Rate Notes, if any, subject to any Sell Order
                                placed by such Existing Owner;

                        and

                        (4)     to the extent such Bidder is a Potential Owner,
                the rate specified in such Potential Owner's Bid.

                (B)     If any rate specified in any Bid contains more than
        three figures to the right of the decimal point, the Auction Agent shall
        round such rate up to the next higher one thousandth of 1%.

                (C)     If an Order or Orders covering all Outstanding Auction
        Rate Notes owned by an Existing Owner is not submitted to the Auction
        Agent prior to the Submission Deadline, the Auction Agent shall deem a
        Hold Order to have been

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        submitted on behalf of such Existing Owner covering the principal amount
        of Outstanding Auction Rate Notes owned by such Existing Owner and not
        subject to an Order submitted to the Auction Agent.

                (D)     Neither the Issuer, the Indenture Trustee nor the
        Auction Agent shall be responsible for any failure of a Broker-Dealer to
        submit an Order to the Auction Agent on behalf of any Existing Owner or
        Potential Owner.

                (E)     If any Existing Owner submits through a Broker-Dealer to
        the Auction Agent one or more Orders covering in the aggregate more than
        the principal amount of Outstanding Auction Rate Notes owned by such
        Existing Owner, such Orders shall be considered valid as follows and in
        the following order of priority:

                        (1)     All Hold Orders shall be considered valid, but
                only up to the aggregate principal amount of Outstanding Auction
                Rate Notes owned by such Existing Owner, and if the aggregate
                principal amount of Auction Rate Notes subject to such Hold
                Orders exceeds the aggregate principal amount of Auction Rate
                Notes owned by such Existing Owner, the aggregate principal
                amount of Auction Rate Notes subject to each such Hold Order
                shall be reduced pro rata so that the aggregate principal amount
                of Auction Rate Notes subject to such Hold Order equals the
                aggregate principal amount of Outstanding Auction Rate Notes
                owned by such Existing Owner.

                        (2)     a.      Any Bid shall be considered valid up to
                an amount equal to the excess of the principal amount of
                Outstanding Auction Rate Notes owned by such Existing Owner over
                the aggregate principal amount of Auction Rate Notes subject to
                any Hold Order referred to in clause (A) of this paragraph (ii);

                                b.      subject to subclause (2)a. of this
                        clause (E), if more than one Bid with the same rate is
                        submitted on behalf of such Existing Owner and the
                        aggregate principal amount of Outstanding Auction Rate
                        Notes subject to such Bids is greater than such excess,
                        such Bids shall be considered valid up to an amount
                        equal to such excess;

                                c.      subject to subclauses (2)a. and (2)b. of
                        this clause (E), if more than one Bid with different
                        rates are submitted on behalf of such Existing Owner,
                        such Bids shall be considered valid first in the
                        ascending order of their respective rates until the
                        highest rate is reached at which such excess exists and
                        then at such rate up to the amount of such excess; and

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                                        d.      in any such event, the amount of
                                Outstanding Auction Rate Notes, if any, subject
                                to Bids not valid under this clause (E) shall be
                                treated as the subject of a Bid by a Potential
                                Owner at the rate therein specified; and

                                (3)     All Sell Orders shall be considered
                        valid up to an amount equal to the excess of the
                        principal amount of Outstanding Auction Rate Notes owned
                        by such Existing Owner over the aggregate principal
                        amount of Auction Rate Notes subject to Hold Orders
                        referred to in clause (1) of this paragraph (E) and
                        valid Bids referred to in clause (2) of this paragraph
                        (E).

                        (F)     If more than one Bid for Auction Rate Notes is
                submitted on behalf of any Potential Owner, each Bid submitted
                shall be a separate Bid with the rate and principal amount
                therein specified.

                        (G)     An Existing Owner that offers to purchase
                additional Auction Rate Notes is, for purposes of such offer,
                treated as a Potential Owner.

                        (H)     Any Bid or Sell Order submitted by an Existing
                Owner covering an aggregate principal amount of Auction Rate
                Notes not equal to an Authorized Denomination shall be rejected
                and shall be deemed a Hold Order. Any Bid submitted by a
                Potential Owner covering an aggregate principal amount of
                Auction Rate Notes not equal to an Authorized Denomination shall
                be rejected.

                        (I)     Any Bid specifying a rate higher than the
                applicable Maximum Rate will (1) be treated as a Sell Order if
                submitted by an Existing Owner and (2) not be accepted if
                submitted by a Potential Owner.

                        (J)     Any Order submitted in an Auction by a
                Broker-Dealer to the Auction Agent prior to the Submission
                Deadline on any Auction Date shall be irrevocable.

                (iii)   (A) Not earlier than the Submission Deadline on each
        Auction Date, the Auction Agent shall assemble all valid Orders
        submitted or deemed submitted to it by the Broker-Dealers (each such
        Order as submitted or deemed submitted by a Broker-Dealer being herein
        referred to individually as a "Submitted Hold Order," a "Submitted Bid"
        or a "Submitted Sell Order," as the case may be, or as a "Submitted
        Order," and collectively as "Submitted Hold Orders," "Submitted Bids" or
        "Submitted Sell Orders," as the case may be, or as "Submitted Orders")
        and shall determine:

                                (1)     the excess of the total principal amount
                        of Outstanding Auction Rate Notes over the sum of the
                        aggregate principal amount of Outstanding Auction Rate
                        Notes subject to Submitted Hold Orders (such excess
                        being herein referred to as the "Available Auction Rate
                        Notes"), and

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                                (2)     from the Submitted Orders whether:

                                        a.      the aggregate principal amount
                                of Outstanding Auction Rate Notes subject to
                                Submitted Bids by Potential Owners specifying
                                one or more rates equal to or lower than the
                                applicable Maximum Rate;

                        exceeds or is equal to the sum of:

                                        b.      the aggregate principal amount
                                of Outstanding Auction Rate Notes subject to
                                Submitted Bids by Existing Owners specifying one
                                or more rates higher than the applicable Maximum
                                Rate; and

                                        c.      the aggregate principal amount
                                of Outstanding Auction Rate Notes subject to
                                Submitted Sell Orders;

                        (in the event such excess or such equality exists, other
                        than because all of the Outstanding Auction Rate Notes
                        are subject to Submitted Hold Orders, such Submitted
                        Bids described in subclause a. above shall be referred
                        to collectively as "Sufficient Bids"); and

                                (3)     if Sufficient Bids exist, the "Bid
                        Auction Rate", which shall be the lowest rate specified
                        in such Submitted Bids such that if:

                                        a.      (x) each Submitted Bid from
                                Existing Owners specifying such lowest rate and
                                (y) all other Submitted Bids from Existing
                                Owners specifying lower rates were rejected,
                                thus entitling such Existing Owners to continue
                                to own the principal amount of Auction Rate
                                Notes subject to such Submitted Bids; and

                                        b.      (x) each such Submitted Bid from
                                Potential Owners specifying such lowest rate and
                                (y) all other Submitted Bids from Potential
                                Owners specifying lower rates were accepted;

                        the result would be that such Existing Owners described
                        in subclause a. above would continue to own an aggregate
                        principal amount of Outstanding Auction Rate Notes that,
                        when added to the aggregate principal amount of
                        Outstanding Auction Rate Notes to be purchased by such
                        Potential Owners described in subclause b. above, would
                        equal not less than the Available Auction Rate Notes.

                        (B)     Promptly after the Auction Agent has made the
                determinations pursuant to Section 2.02(a)(iii)(A) of this
                Appendix B, the Auction Agent shall advise the Indenture
                Trustee, the Broker-Dealers and the Issuer of the Net Loan

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                Rate, Maximum Rate and the All Hold Rate and the components
                thereof on the Auction Date. Based on such determinations, the
                Auction Rate for the next succeeding Interest Period will be
                established as follows:

                                (1)     if Sufficient Bids exist, that the
                        Auction Rate for the next succeeding Interest Period
                        shall be equal to the Bid Auction Rate so determined;

                                (2)     if Sufficient Bids do not exist (other
                        than because all of the Outstanding Auction Rate Notes
                        are subject to Submitted Hold Orders), that the Auction
                        Rate for the next succeeding Interest Period shall be
                        equal to the applicable Maximum Rate; or

                                (3)     if all Outstanding Auction Rate Notes
                        are subject to Submitted Hold Orders, that the Auction
                        Rate for the next succeeding Interest Period shall be
                        equal to the applicable All Hold Rate.

                        (C)     Promptly after the Auction Agent has determined
                the Auction Rate, the Auction Agent shall determine and advise
                the Indenture Trustee of the Auction Note Interest Rate, which
                rate shall be the lesser of (x) the Auction Rate and (y) the
                applicable Maximum Rate.

                (iv)    Existing Owners shall continue to own the principal
        amount of Auction Rate Notes that are subject to Submitted Hold Orders.
        If the Net Loan Rate is equal to or greater than the Bid Auction Rate
        and if Sufficient Bids have been received by the Auction Agent, the Bid
        Auction Rate will be the Auction Note Interest Rate, and Submitted Bids
        and Submitted Sell Orders will be accepted or rejected and the Auction
        Agent will take such other action as described below in subparagraph
        (A).

        If the Maximum Rate is less than the Auction Rate, the Maximum Rate will
be the Auction Note Interest Rate. If the Auction Agent has not received
Sufficient Bids (other than because all of the Outstanding Auction Rate Notes
are subject to Submitted Hold Orders), the Auction Note Interest Rate will be
the applicable Maximum Rate. In any of the cases described above, Submitted
Orders will be accepted or rejected and the Auction Agent will take such other
action as described below in subparagraph (B).

                        (A)     If Sufficient Bids have been made and the
                Maximum Rate is equal to or greater than the Bid Auction Rate
                (in which case the Auction Note Interest Rate shall be the Bid
                Auction Rate), all Submitted Sell Orders shall be accepted and,
                subject to the provisions of clauses (4) and (5) of this Section
                2.02(a)(iv), Submitted Bids shall be accepted or rejected as
                follows in the following order of priority, and all other
                Submitted Bids shall be rejected:

                                (1)     Existing Owners' Submitted Bids
                        specifying any rate that is higher than the Auction Note
                        Interest Rate shall be accepted, thus

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                        requiring each such Existing Owner to sell the aggregate
                        principal amount of Auction Rate Notes subject to such
                        Submitted Bids;

                                (2)     Existing Owners' Submitted Bids
                        specifying any rate that is lower than the Auction Note
                        Interest Rate shall be rejected, thus entitling each
                        such Existing Owner to continue to own the aggregate
                        principal amount of Auction Rate Notes subject to such
                        Submitted Bids;

                                (3)     Potential Owners' Submitted Bids
                        specifying any rate that is lower than the Auction Note
                        Interest Rate shall be accepted;

                                (4)     Each Existing Owners' Submitted Bid
                        specifying a rate that is equal to the Auction Note
                        Interest Rate shall be rejected, thus entitling such
                        Existing Owner to continue to own the aggregate
                        principal amount of Auction Rate Notes subject to such
                        Submitted Bid, unless the aggregate principal amount of
                        Outstanding Auction Rate Notes subject to all such
                        Submitted Bids shall be greater than the principal
                        amount of Auction Rate Notes (the "remaining principal
                        amount") equal to the excess of the Available Auction
                        Rate Notes over the aggregate principal amount of
                        Auction Rate Notes subject to Submitted Bids described
                        in clauses (2) and (3) of this Section 2.02(a)(iv)(A),
                        in which event such Submitted Bid of such Existing Owner
                        shall be rejected in part, and such Existing Owner shall
                        be entitled to continue to own the principal amount of
                        Auction Rate Notes subject to such Submitted Bid, but
                        only in an amount equal to the aggregate principal
                        amount of Auction Rate Notes obtained by multiplying the
                        remaining principal amount by a fraction, the numerator
                        of which shall be the principal amount of Outstanding
                        Auction Rate Notes owned by such Existing Owner subject
                        to such Submitted Bid and the denominator of which shall
                        be the sum of the principal amount of Outstanding
                        Auction Rate Notes subject to such Submitted Bids made
                        by all such Existing Owners that specified a rate equal
                        to the Auction Note Interest Rate, subject to the
                        provisions of Section 2.02(a)(iv)(D) of this Appendix B;
                        and

                                (5)     Each Potential Owner's Submitted Bid
                        specifying a rate that is equal to the Auction Note
                        Interest Rate shall be accepted, but only in an amount
                        equal to the principal amount of Auction Rate Notes
                        obtained by multiplying the excess of the aggregate
                        principal amount of Available Auction Rate Notes over
                        the aggregate principal amount of Auction Rate Notes
                        subject to Submitted Bids described in clauses (2), (3)
                        and (4) of this Section 2.02(a)(iv)(A) by a fraction the
                        numerator of which shall be the aggregate principal
                        amount of Outstanding Auction Rate Notes subject to such
                        Submitted Bid and the denominator of which shall be the
                        sum of the principal amount of Outstanding Auction Rate
                        Notes subject to Submitted Bids made by all such
                        Potential Owners that

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                        specified a rate equal to the Auction Note Interest
                        Rate, subject to the provisions of Section
                        2.02(a)(iv)(D) of this Appendix B.

                        (B)     If Sufficient Bids have not been made (other
                than because all of the Outstanding Auction Rate Notes are
                subject to submitted Hold Orders), or if the Maximum Rate is
                less than the Bid Auction Rate (in which case the Auction Note
                Interest Rate shall be the Maximum Rate), subject to the
                provisions of Section 2.02(a)(iv)(D) of this Appendix B,
                Submitted Orders shall be accepted or rejected as follows in the
                following order of priority and all other Submitted Bids shall
                be rejected:

                                (1)     Existing Owners' Submitted Bids
                        specifying any rate that is equal to or lower than the
                        Auction Note Interest Rate shall be rejected, thus
                        entitling such Existing Owners to continue to own the
                        aggregate principal amount of Auction Rate Notes subject
                        to such Submitted Bids;

                                (2)     Potential Owners' Submitted Bids
                        specifying (x) any rate that is equal to or lower than
                        the Auction Note Interest Rate shall be accepted and (y)
                        any rate that is higher than the Auction Note Interest
                        Rate shall be rejected; and

                                (3)     each Existing Owner's Submitted Bid
                        specifying any rate that is higher than the Auction Note
                        Interest Rate and the Submitted Sell Order of each
                        Existing Owner shall be accepted, thus entitling each
                        Existing Owner that submitted any such Submitted Bid or
                        Submitted Sell Order to sell the Auction Rate Notes
                        subject to such Submitted Bid or Submitted Sell Order,
                        but in both cases only in an amount equal to the
                        aggregate principal amount of Auction Rate Notes
                        obtained by multiplying the aggregate principal amount
                        of Auction Rate Notes subject to Submitted Bids
                        described in clause (2)(x) of this Section
                        2.02(a)(iv)(B) by a fraction the numerator of which
                        shall be the aggregate principal amount of Outstanding
                        Auction Rate Notes owned by such Existing Owner subject
                        to such submitted Bid or Submitted Sell Order and the
                        denominator of which shall be the aggregate principal
                        amount of Outstanding Auction Rate Notes subject to all
                        such Submitted Bids and Submitted Sell Orders.

                        (C)     If all Auction Rate Notes are subject to
                Submitted Hold Orders, all Submitted Bids shall be rejected.

                        (D)     If, as a result of the procedures described in
                paragraph (A) or (B) of this Section 2.02(a)(iv), any Existing
                Owner would be entitled or required to sell, or any Potential
                Owner would be entitled or required to purchase, a principal
                amount of Auction Rate Notes that is not equal to an Authorized
                Denomination, the Auction Agent shall, in such manner as in its
                sole discretion it shall determine, round up or down the
                principal amount of Auction Rate Notes to be purchased or

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                sold by any Existing Owner or Potential Owner so that the
                principal amount of Auction Rate Notes purchased or sold by each
                Existing Owner or Potential Owner shall be equal to an
                Authorized Denomination.

                        (E)     If, as a result of the procedures described in
                paragraph (B) of this Section 2.02(a)(iv), any Potential Owner
                would be entitled or required to purchase less than an
                Authorized Denomination of Auction Rate Notes, the Auction Agent
                shall, in such manner as in its sole discretion it shall
                determine, allocate Auction Rate Notes for purchase among
                Potential Owners so that only Auction Rate Notes in Authorized
                Denominations are purchased by any Potential Owner, even if such
                allocation results in one or more of such Potential Owners not
                purchasing any Auction Rate Notes.

                (v)     Based on the result of each Auction, the Auction Agent
        shall determine the aggregate principal amount of Auction Rate Notes to
        be purchased and the aggregate principal amount of Auction Rate Notes to
        be sold by Potential Owners and Existing Owners on whose behalf each
        Broker-Dealer submitted Bids or Sell Orders and, with respect to each
        Broker-Dealer, to the extent that such aggregate principal amount of
        Auction Rate Notes to be sold differs from such aggregate principal
        amount of Auction Rate Notes to be purchased, determine to which other
        Broker-Dealer or Broker-Dealers acting for one or more purchasers such
        Broker-Dealer shall deliver, or from which other Broker-Dealer or
        Broker-Dealers acting for one or more sellers such Broker-Dealer shall
        receive, as the case may be, Auction Rate Notes.

                (vi)    Any calculation by the Auction Agent or the Indenture
        Trustee, as applicable, of the Auction Note Interest Rate, the Maximum
        Rate, the All Hold Rate, the Net Loan Rate and the Non-Payment Rate
        shall, in the absence of manifest error, be binding on all other
        parties.

                (vii)   Notwithstanding anything in this Appendix B to the
        contrary, (A) no Auction for the Auction Rate Notes for an Auction
        Period of less than 180 days will be held on any Auction Date hereunder
        on which there are insufficient moneys in the Collection Account to pay,
        or otherwise held by the Indenture Trustee under the Indenture and
        available to pay, the principal of and interest due on the Auction Rate
        Notes on the Payment Date immediately following such Auction Date, and
        (B) no Auction will be held on any Auction Date hereunder during the
        continuance of a Payment Default. The Indenture Trustee shall promptly
        notify the Auction Agent of any such occurrence.

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

                (i)     The Indenture Trustee shall determine not later than
        2:00 p.m., eastern time, on the Business Day next succeeding a Payment
        Date, whether a Payment Default has occurred. If a Payment Default has
        occurred, the Indenture Trustee shall, not later than 2:15 p.m., eastern
        time, on such Business Day, send a notice thereof in substantially the
        form of Exhibit D attached hereto to the Auction Agent by telecopy or
        similar means

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        and, if such Payment Default is cured, the Indenture Trustee shall
        immediately send a notice in substantially the form of Exhibit E
        attached hereto to the Auction Agent by telecopy or similar means.

                (ii)    Not later than 2:00 p.m., eastern time, on each
        anniversary of the Closing Date, the Indenture Trustee shall pay to the
        Auction Agent, in immediately available funds out of amounts in the
        Collection Account, an amount equal to the Auction Agent Fee as set
        forth in the Auction Agent Agreement as set forth in the Servicer's
        Report. Not later than 2:00 p.m., eastern time, on each Auction Date,
        the Indenture Trustee shall pay to the Auction Agent, in immediately
        available funds out of amounts in the Collection Account, an amount
        equal to the Broker-Dealer Fee as calculated in the Auction Agent
        Agreement. The Indenture Trustee shall, from time to time at the request
        of the Auction Agent and at the direction of an Authorized Officer,
        reimburse the Auction Agent for its reasonable expenses as provided in
        the Auction Agent Agreement, such expenses to be paid out of amounts in
        the Collection Account.

        (c)     Calculation of Maximum Rate, All Hold Rate, Net Loan Rate,
Applicable LIBOR Rate, and Non-Payment Rate. The Auction Agent shall calculate
the applicable Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold
Rate, as the case may be, on each Auction Date and shall notify the Indenture
Trustee and the Broker-Dealers of the applicable Maximum Rate, Net Loan Rate,
Applicable LIBOR Rate, and All Hold Rate, as the case may be, as provided in the
Auction Agent Agreement; provided, that if the ownership of the Auction Rate
Notes is no longer maintained in Book-entry Form, or if a Payment Default has
occurred, then the Indenture Trustee shall determine the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and Non-Payment Rate
for each such Interest Period. If the ownership of the Auction Rate Notes is no
longer maintained in Book-entry Form by the Securities Depository, the Indenture
Trustee shall calculate the applicable Maximum Rate and the Net Loan Rate on the
Business Day immediately preceding the first day of each Interest Period after
the delivery of certificates representing the Auction Rate Notes pursuant to the
Indenture. If a Payment Default shall have occurred, the Indenture Trustee shall
calculate the Non-Payment Rate on the Interest Rate Determination Date for (i)
each Interest Period commencing after the occurrence and during the continuance
of such Payment Default and (ii) any Interest Period commencing less than two
Business Days after the cure of any Payment Default. The determination by the
Indenture Trustee or the Auction Agent, as the case may be, of the applicable
Maximum Rate, Net Loan Rate, Applicable LIBOR Rate, All Hold Rate and
Non-Payment Rate shall (in the absence of manifest error) be final and binding
upon all parties. If calculated or determined by the Auction Agent, the Auction
Agent shall promptly advise the Indenture Trustee of the applicable Maximum
Rate, Net Loan Rate, Applicable LIBOR Rate, and All Hold Rate.

        (d)     Notification of Rates, Amounts and Payment Dates.

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

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<PAGE>

                (ii)    At least four days prior to any Payment Date, the
        Indenture Trustee shall:

                        (A)     confirm with the Auction Agent, so long as no
                Payment Default has occurred and is continuing and the ownership
                of the Auction Rate Notes is maintained in Book-entry Form by
                the Securities Depository, (1) the date of such next Payment
                Date and (2) the amount payable to the Auction Agent on the
                Auction Date pursuant to Section 2.02(b)(ii) of this Appendix B;
                and

                        (B)     advise the Securities Depository, so long as the
                ownership of the Auction Rate Notes is maintained in Book-entry
                Form by the Securities Depository, upon request, of the
                aggregate amount of interest distributable on such next Payment
                Date to the beneficial owners of each Series of the Auction Rate
                Notes.

        If any day scheduled to be a Payment Date shall be changed after the
Indenture Trustee shall have given the notice or confirmation referred to in
clause (i) of the preceding sentence, the Indenture Trustee shall, not later
than 11:15 a.m., eastern time, on the Business Day next preceding the earlier of
the new Payment Date or the old Payment Date, by such means as the Indenture
Trustee deems practicable, give notice of such change to the Auction Agent, so
long as no Payment Default has occurred and is continuing and the ownership of
the Auction Rate Notes is maintained in Book-entry Form by the Securities
Depository.

        (e)     Auction Agent.

                (i)     __________ is hereby appointed as Initial Auction Agent
        to serve as agent for the Issuer in connection with Auctions. The
        Indenture Trustee and the Issuer will, and the Indenture Trustee is
        hereby directed to, enter into the Initial Auction Agent Agreement with
        __________, as the Initial Auction Agent. Any Substitute Auction Agent
        shall be (A) a bank, national banking association or trust company duly
        organized under the laws of the United States of America or any state or
        territory thereof having its principal place of business in the Borough
        of Manhattan, New York, or such other location as approved by the
        Indenture Trustee in writing and having a combined capital stock or
        surplus of at least $50,000,000, or (B) a member of the National
        Association of Securities Dealers, Inc., having a capitalization of at
        least $50,000,000, and, in either case, authorized by law to perform all
        the duties imposed upon it hereunder and under the Auction Agent
        Agreement. The Auction Agent may at any time resign and be discharged of
        the duties and obligations created by this Appendix B by giving at least
        90 days' notice to the Indenture Trustee, each Broker-Dealer and the
        Issuer. The Auction Agent may be removed at any time by the Indenture
        Trustee upon the written direction of an Authorized Officer or by the
        holders of a majority of the aggregate principal amount of the Auction
        Rate Notes then Outstanding, and if by such Noteholders, by an
        instrument signed by such Noteholders or their attorneys and filed with
        the Auction Agent, the Issuer and the Indenture Trustee upon at least 90
        days' written notice. Neither resignation nor removal of the Auction
        Agent pursuant to the preceding two sentences shall be effective until
        and unless a Substitute Auction Agent has been appointed and has
        accepted such appointment.

                                      B-22
                                                              Indenture of Trust

<PAGE>

        If required by the Issuer, a Substitute Auction Agent Agreement shall be
        entered into with a Substitute Auction Agent. Notwithstanding the
        foregoing, the Auction Agent may terminate the Auction Agent Agreement
        if, within 25 days after notifying the Indenture Trustee, each
        Broker-Dealer and the Issuer in writing that it has not received payment
        of any Auction Agent Fee due it in accordance with the terms of the
        Auction Agent Agreement, the Auction Agent does not receive such
        payment.

                (ii)    If the Auction Agent shall resign or be removed or be
        dissolved, or if the property or affairs of the Auction Agent shall be
        taken under the control of any state or federal court or administrative
        body because of bankruptcy or insolvency, or for any other reason, the
        Indenture Trustee at the direction of an Authorized Officer, shall use
        its best efforts to appoint a Substitute Auction Agent.

                (iii)   The Auction Agent is acting as agent for the Issuer in
        connection with Auctions. In the absence of bad faith, negligent failure
        to act or negligence on its part, the Auction Agent shall not be liable
        for any action taken, suffered or omitted or any error of judgment made
        by it in the performance of its duties under the Auction Agent Agreement
        and shall not be liable for any error of judgment made in good faith
        unless the Auction Agent shall have been negligent in ascertaining (or
        failing to ascertain) the pertinent facts.

        (f)     Broker-Dealers.

                (i)     The Auction Agent will enter into a Broker-Dealer
        Agreement with __________, as the sole initial Broker-Dealer for Series
        ___ Notes, and __________, as the sole initial Broker-Dealer for Series
        ___ Notes. An Authorized Officer may, from time to time, approve one or
        more additional Persons to serve as a Broker-Dealer under the
        Broker-Dealer Agreements and shall be responsible for providing such
        Broker-Dealer Agreements to the Indenture Trustee and the Auction Agent.

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

        (g)     Changes in Auction Period or Periods and Certain Percentages.

                (i)     While any of the Auction Rate Notes are Outstanding, the
        Issuer may, from time to time, change the length of one or more Auction
        Periods (an "Auction Period Adjustment"), to conform with then current
        market practice with respect to similar securities or to accommodate
        economic and financial factors that may affect or be relevant to the
        length of the Auction Period and the interest rate borne by the Auction
        Rate Notes. The Issuer shall not initiate an Auction Period Adjustment
        unless it shall have received the written consent of the Market Agent,
        which consent shall not be unreasonably withheld, not later than nine
        days prior to the Auction Date for such Auction Period. The Issuer shall
        not initiate an Auction Period Adjustment that would result in an
        Auction Period longer than 120 days unless it shall have received a
        Rating Confirmation regarding that Auction Period Adjustment. The Issuer
        shall initiate the

                                      B-23
                                                              Indenture of Trust

<PAGE>

        Auction Period Adjustment by giving written notice by Issuer Order to
        the Indenture Trustee, the Auction Agent, the Market Agent, each
        Broker-Dealer, each Rating Agency and the Securities Depository in
        substantially the form of, or containing substantially the information
        contained in, Exhibit F attached hereto at least 10 days prior to the
        Auction Date for such Auction Period.

                (ii)    Any such adjusted Auction Period shall not be less than
        one day nor more than 366 days.

                (iii)   An Auction Period Adjustment shall take effect only if
        (A) the Indenture Trustee and the Auction Agent receive, by 11:00 a.m.,
        eastern time, on the Business Day before the Auction Date for the first
        such Auction Period, an Issuer Certificate in substantially the form
        attached as, or containing substantially the same information contained
        in, Exhibit G attached hereto, authorizing the Auction Period Adjustment
        specified in such certificate along with a copy of the written consent
        of the Market Agent and, (B) Sufficient Bids exist as of the Auction on
        the Auction Date for such first Auction Period. If the condition
        referred to in (A) above is not met, the applicable Auction Note
        Interest Rate for the next Auction Period shall be determined pursuant
        to the above provisions of this Section 2.02 and the Auction Period
        shall be the Auction Period determined without reference to the proposed
        change. If the condition referred to in (A) is met but the condition
        referred in (B) above is not met, the applicable Auction Note Interest
        Rate for the next Auction Period shall be the applicable Maximum Rate
        and the Auction Period shall be the Auction Period determined without
        reference to the proposed change.

        In connection with any Auction Period Adjustment, the Auction Agent
shall provide such further notice to such parties as is specified in Section
2.03 of the Auction Agent Agreement.

        (h)     Changes in the Auction Date. The Market Agent, with the written
consent of the Administrator on behalf of the Issuer, may specify a different
Auction Date (but in no event more than five Business Days earlier than the
Auction Date that would otherwise be determined in accordance with the
definition of "Auction Date" in Section 1.01 of this Appendix B) with respect to
one or more specified Auction Periods to conform with then current market
practice with respect to similar securities or to accommodate economic and
financial factors that may affect or be relevant to the day of the week
constituting an Auction Date and the interest rate borne on the Auction Rate
Notes. The Market Agent shall deliver a written request for consent to such
change in the Auction Date to the Administrator at least 14 days prior to the
effective date of such change. If the Administrator shall have delivered such
written consent to the Market Agent, the Market Agent shall provide notice of
its determination to specify an earlier Auction Date for one or more Auction
Periods by means of a written notice delivered at least 10 days prior to the
proposed changed Auction Date to the Indenture Trustee, the Auction Agent, the
Issuer, the Administrator, each Rating Agency and the Securities Depository.
Such notice shall be substantially in the form of, or contain substantially the
information contained in, Exhibit H attached hereto.

                                      B-24
                                                              Indenture of Trust

<PAGE>

        In connection with any change described in this Section 2.02(h), the
Auction Agent shall provide such further notice to such parties as is specified
in Section 2.03 of the Auction Agent Agreement.

        Section 2.03 Additional Provisions Regarding the Interest Rates on the
Auction Rate Notes. The determination of an Auction Note Interest Rate by the
Auction Agent or any other Person pursuant to the provisions of the applicable
Section of this Article II shall be conclusive and binding on the Noteholders of
the Auction Rate Notes to which such Auction Note Interest Rate applies, and the
Issuer and the Indenture Trustee may rely thereon for all purposes.

        In no event shall the cumulative amount of interest paid or payable on
the Auction Rate Notes (including interest calculated as provided herein, plus
any other amounts that constitute interest on the Auction Rate Notes under
applicable law and are contracted for, charged, reserved, taken or received
pursuant to the Auction Rate Notes or related documents) calculated from the
Closing Date of the Auction Rate Notes through any subsequent day during the
term of the Auction Rate Notes or otherwise prior to payment in full of the
Auction Rate Notes exceed the amount permitted by applicable law. If the
applicable law is ever judicially interpreted so as to render usurious any
amount called for under the Auction Rate Notes or related documents or otherwise
contracted for, charged, reserved, taken or received in connection with the
Auction Rate Notes, or if the redemption or acceleration of the maturity of the
Auction Rate Notes results in payment to or receipt by the Noteholder or any
former Noteholder of the Auction Rate Notes of any interest in excess of that
permitted by applicable law, then, notwithstanding any provision of the Auction
Rate Notes or related documents to the contrary, all excess amounts theretofore
paid or received with respect to the Auction Rate Notes shall be credited on the
principal balance of the Auction Rate Notes (or, if the Auction Rate Notes have
been paid or would thereby be paid in full, refunded by the recipient thereof),
and the provisions of the Auction Rate Notes and related documents shall
automatically and immediately be deemed reformed and the amounts thereafter
collectible hereunder and thereunder reduced, without the necessity of the
execution of any new document, so as to comply with the applicable law, but so
as to permit the recovery of the fullest amount otherwise called for under the
Auction Rate Notes and under the related documents.

                                      B-25
                                                              Indenture of Trust

<PAGE>

                                   EXHIBIT A-1

                              FORM OF CLASS A NOTES

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

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

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTE
                                  SERIES A-___

REGISTERED NO. A-__                                       REGISTERED $__________

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

PRINCIPAL SUM:  __________ DOLLARS
NOTEHOLDER: CEDE & CO.

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

                                      A-1-1
                                                              Indenture of Trust

<PAGE>

        Any capitalized words and terms used as defined words and terms in this
Note and not otherwise defined herein shall have the meanings given to them in
the Indenture of Trust dated as of __________, 20___ (the "Indenture") among the
Issuer, __________, as Indenture Trustee, and __________, as Trust Eligible
Lender Trustee.

FOR AUCTION RATE NOTES:

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

FOR LIBOR NOTES:

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

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

        This Note is one of a Series of Notes of the Issuer designated Education
Loan Backed Notes, Series A-___, dated __________, 20___ (the "Original Issue
Date"), in the aggregate original principal amount of $__________ (the "Series
A-___ Notes"), which have been authorized and issued by the Issuer pursuant to
the Indenture. The Issuer is, simultaneously with the issuance of the Series
A-___ Notes, issuing $__________ of its Education Loan Backed Notes, Series
A-___ (the "Series A-___ Notes"), $__________ of its Education Loan Backed
Notes, Series A-___ (the "Series A-___ Notes"), $__________ of its Education
Loan Backed Notes, Series A-___ (the "Series A-___ Notes"), $__________ of its
Education Loan Backed Notes, Series A-___ (the "Series A-___ Notes"),
$__________ of its Education Loan Backed Notes, Series A-___ (the "Series A-___
Notes"), $__________ of its Education Loan Backed Notes, Series A-___ (the
"Series A-___ Notes"), $__________ of its Education Loan Backed Notes, Series
A-___ (the "Series A-___ Notes"), and $__________ of its Education Loan Backed
Notes, Series B-___ Notes (the "Series B-___ Notes"). The proceeds of such Notes
shall be used by the Issuer, together with other moneys of the Issuer, for the
purpose of providing funds to finance the acquisition of education loans, [to
fund a capitalized interest account, to fund a reserve account] and to pay
certain costs and expenses in connection with the issuance of such Notes.

        Under the Indenture, the Series A-___ Notes, the Series A-___ Notes, the
Series A-___ Notes, the Series A-___ Notes, the Series A-___ Notes, the Series
A-___ Notes, the Series A-___ Notes, and the Series A-___ Notes are defined as
"Class A Notes"; and the Series B-___ Notes are

                                      A-1-2
                                                              Indenture of Trust

<PAGE>

defined as "Class B Notes". The Class A Notes and the Class B Notes are
collectively referred to herein as the "Notes".

        Under the Indenture, the Series A-___ Notes, the Series A-___ Notes, and
the Series A-___ Notes are defined as "LIBOR Notes"; and the Series A-___ Notes,
the Series A-___ Notes, the Series A-___ Notes, the Series A-___ Notes, the
Series A-___ Notes and the Series B-___ Notes are defined as "Auction Rate
Notes".

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

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

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

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

        Reference is hereby made to the Indenture, a copy of which is on file in
the Corporate Trust Office of the Indenture Trustee, to all of the provisions of
which any Noteholder of this Note by his acceptance hereof hereby assents, for
definitions of terms; the description of and the nature and extent of the
security for the Notes; the Issuer's education loan origination and acquisition
program; the revenues and other money pledged to the payment of the principal of
and interest on the Notes; the nature and extent and manner of enforcement of
the pledge; the

                                      A-1-3
                                                              Indenture of Trust

<PAGE>

conditions upon which the Indenture may be amended or supplemented with or
without the consent of the Noteholders and any Counterparty; the rights and
remedies of the Noteholder hereof with respect hereto and thereto, including the
limitations upon the right of a Noteholder hereof to institute any suit, action,
or proceeding in equity or at law with respect hereto and thereto; the rights,
duties, and obligations of the Issuer and the Indenture Trustee thereunder; the
terms and provisions upon which the liens, pledges, charges, trusts, and
covenants made therein may be discharged at or prior to the Stated Maturity or
earlier redemption of this Note, and this Note thereafter shall no longer be
secured by the Indenture or be deemed to be Outstanding thereunder; and for the
other terms and provisions thereof.

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

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

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

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

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

                                      A-1-4
                                                              Indenture of Trust

<PAGE>

purposes of receiving payment of principal hereof at its Stated Maturity and (c)
for all other purposes, whether or not this Note is overdue, and neither the
Issuer, the Indenture Trustee, nor any such agent shall be affected by notice to
the contrary.

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

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

                                      A-1-5
                                                              Indenture of Trust

<PAGE>

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

                                        [EDUCATION FUNDING CAPITAL TRUST-___]

                                        By:                                    ,
                                           ------------------------------------
                                           as Co-Owner Trustee,

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

                                      A-1-6
                                                              Indenture of Trust

<PAGE>

                          CERTIFICATE OF AUTHENTICATION

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

                                        __________, as Indenture Trustee

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

Authentication Date:

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

                                   ASSIGNMENT

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

Dated:                                                        Signed:

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

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

Signature Guaranteed by:

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

                                      A-1-7
                                                              Indenture of Trust

<PAGE>

                                   EXHIBIT A-2

                              FORM OF CLASS B NOTES

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

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

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTE
                                  SERIES B-___

REGISTERED NO. A-__                                     REGISTERED $__________

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

PRINCIPAL SUM:  __________ DOLLARS
NOTEHOLDER: CEDE & CO.

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

                                      A-2-1
                                                              Indenture of Trust

<PAGE>

        Any capitalized words and terms used as defined words and terms in this
Note and not otherwise defined herein shall have the meanings given to them in
the Indenture of Trust dated as of __________, 20___ (the "Indenture") among the
Issuer, __________, as Indenture Trustee, and __________, as Trust Eligible
Lender Trustee.

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

        This Note is one of a Series of Notes of the Issuer designated Education
Loan Backed Notes, Series B-___, dated __________, 20___ (the "Original Issue
Date"), in the aggregate original principal amount of $__________ (the "Series
B-___ Notes"), which have been authorized by the Issuer, and issued by the
Issuer pursuant to the Indenture. The Issuer is, simultaneously with the
issuance of the Series B-___ Notes, issuing $__________ of its Education Loan
Backed Notes, Series A-___ (the "Series A-___ Notes"), $__________ of its
Education Loan Backed Notes, Series A-___ (the "Series A-___ Notes"),
$__________ of its Education Loan Backed Notes, Series A-___ (the "Series A-___
Notes"), $__________ of its Education Loan Backed Notes, Series A-___ (the
"Series A-___ Notes"), $__________ of its Education Loan Backed Notes, Series
A-___ (the "Series A-___ Notes"), $__________ of its Education Loan Backed
Notes, Series A-___ (the "Series A-___ Notes"), $__________ of its Education
Loan Backed Notes, Series A-___ (the "Series A-___ Notes"), and $__________ of
its Education Loan Backed Notes, Series A-___ Notes (the "Series A-___ Notes").
The proceeds of such Notes shall be used by the Issuer, together with other
moneys of the Issuer, for the purpose of providing funds to finance the
acquisition of education loans, [to fund a capitalized interest account, to fund
a reserve account] and to pay certain costs and expenses in connection with the
issuance of such Notes.

        Under the Indenture, the Series A-___ Notes, the Series A-___ Notes, the
Series A-___ Notes, the Series A-___ Notes, the Series A-___ Notes, the Series
A-___ Notes, the Series A-___ Notes, and the Series A-___ Notes are defined as
"Class A Notes"; and the Series B-___ Notes are defined as "Class B Notes". The
Class A Notes and the Class B Notes are collectively referred to herein as the
"Notes".

        Under the Indenture, the Series A-___ Notes, the Series A-___ Notes, and
the Series A-___ Notes are defined as "LIBOR Notes"; and the Series A-___ Notes,
the Series A-___ Notes, the Series A-___ Notes, the Series A-___ Notes, the
Series A-___ Notes and the Series B-___ Notes are defined as "Auction Rate
Notes".

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

        Notice of the call for redemption shall be given by the Indenture
Trustee by mailing a copy of the notice at least ___ days prior to the
redemption date to the Noteholders of the Notes to be redeemed in whole or in
part at the address of such Noteholder last showing on the registration books.
Failure to give such notice or any defect therein shall not affect the validity
of

                                      A-2-2
                                                              Indenture of Trust

<PAGE>

any proceedings for the redemption of such Notes for which no such failure or
defect occurs. All Notes called for redemption will cease to bear interest after
the specified redemption date, provided funds for their payment are on deposit
at the place of payment at the time. If less than all Notes are to be redeemed,
Notes shall be selected for redemption as provided in the Indenture.

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

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

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

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

        No recourse, either directly or indirectly, shall be had for the payment
of the principal of and interest on this Note or any claim based hereon or in
respect hereof or of the Indenture,

                                      A-2-3
                                                              Indenture of Trust

<PAGE>

against the Indenture Trustee, or any employee, or agent of the Issuer, nor
against the State of Delaware, or any official thereof, but the obligation to
pay all amounts required by the Indenture securing this Note and the obligation
to do and perform the covenants and acts required of the Issuer therein and
herein shall be and remain the responsibility and obligation of said Issuer,
limited as herein set forth.

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

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

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

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

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

                                      A-2-4
                                                              Indenture of Trust

<PAGE>

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

                                        [EDUCATION FUNDING CAPITAL TRUST-___]

                                        By:                                    ,
                                           ------------------------------------
                                            as Co-Owner Trustee,

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

                                      A-2-5
                                                              Indenture of Trust

<PAGE>

                          CERTIFICATE OF AUTHENTICATION

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

                                        __________, as Indenture Trustee

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

Authentication Date:

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

                                   ASSIGNMENT

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

Dated:                                  Signed:

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

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

Signature Guaranteed by:

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

                                      A-2-6
                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT B

                      STUDENT LOAN ACQUISITION CERTIFICATE

                This Student Loan Acquisition Certificate (this "Certificate")
is submitted pursuant to the provisions of Section 4.02 of the Indenture of
Trust dated as of __________, 20___ (the "Indenture") among [Education Funding
Capital Trust -__] (the "Issuer"), [Name of Indenture Trustee], as Indenture
Trustee, and [Name of Trust Eligible Lender Trustee], as Trust Eligible Lender
Trustee. All capitalized terms used in this Certificate and not otherwise
defined herein shall have the same meanings given to such terms in the
Indenture. In your capacity as Indenture Trustee, you are hereby authorized and
requested to disburse to Education Lending Services, Inc. the sum of $__________
(or, in the case of an exchange, the Student Loans listed in Exhibit A hereto)
for the acquisition of Student Loans. With respect to the Student Loans so to be
acquired, the Issuer hereby certifies as follows:

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

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

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

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

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

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

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

                (d)     an Opinion of Counsel to the Issuer specifying each
action necessary to perfect a security interest in all Student Loans to be
acquired by the Issuer pursuant to the Depositor Transfer and Sale Agreement in
favor of the Indenture Trustee in the manner provided for by the provisions of
20 U.S.C. ss. 1087-2(d)(3) or 20 U.S.C. ss.1082 (m)(1)(D)(iv), as

                                       B-1
                                                              Indenture of Trust

<PAGE>

applicable (you are authorized to rely on the advice of a single blanket Opinion
of Counsel to the Issuer until such time as the Issuer shall provide any amended
opinion to you);

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

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

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

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

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

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

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

                                       B-2
                                                              Indenture of Trust

<PAGE>

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

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

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

                  [Remainder of page intentionally left blank.]

                                       B-3
                                                              Indenture of Trust

<PAGE>

                WITNESS my hand this ___ day of __________ 20___.

                                         [EDUCATION FUNDING CAPITAL TRUST -__],
                                             by [Name of Co-Owner Trustee], not
                                             in its individual capacity, but
                                             solely as Co-Owner Trustee on
                                             behalf of the Trust

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

                                       B-4
                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT C

                          CLOSING CASH FLOW PROJECTIONS

                             (to be attached hereto)

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT D

                            NOTICE OF PAYMENT DEFAULT

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

        NOTICE IS HEREBY GIVEN that a Payment Default has occurred and is
continuing with respect to the Auction Rate Notes identified above. The next
Auction for the Auction Rate Notes will not be held. The Auction Rate for the
Auction Rate Notes for the next succeeding Interest Period shall be the
Non-Payment Rate.

                                              [NAME OF INDENTURE TRUSTEE], as
                                                 Indenture Trustee

Dated:                                        By:
       ----------------------------              -------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT E

                        NOTICE OF CURE OF PAYMENT DEFAULT

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

        NOTICE IS HEREBY GIVEN that a Payment Default with respect to the
Auction Rate Notes identified above has been waived or cured. The next Payment
Date is __________________________ and the Auction Date is ___________________.

                                              [NAME OF INDENTURE TRUSTEE], as
                                                 Indenture Trustee

Dated:                                        By:
       ----------------------------              ------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT F

                       NOTICE OF PROPOSED CHANGE IN LENGTH
                         OF ONE OR MORE AUCTION PERIODS

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

        Notice is hereby given that the Issuer proposes to change the length of
one or more Auction Periods pursuant to the Indenture as follows:

        1.      The change shall take effect on _______________, the Interest
Rate Adjustment Date for the next Auction Period (the "Effective Date").

        2.      The Auction Period Adjustment in Paragraph 1 shall take place
only if (a) the Indenture Trustee and the Auction Agent receive, by 11:00 a.m.,
eastern time, on the Business Day before the Auction Date for the Auction Period
commencing on the Effective Date, a certificate from the Issuer, as required by
the Indenture authorizing the change in length of one or more Auction Periods
and (b) Sufficient Bids exist on the Auction Date for the Auction Period
commencing on the Effective Date.

        3.      If the condition referred to in (a) above is not met, the
Auction Rate for the Auction Period commencing on the Effective Date will be
determined pursuant to the Auction Procedures and the Auction Period shall be
the Auction Period determined without reference to the proposed change. If the
condition referred to in (a) is met but the condition referred to in (b) above
is not met, the Auction Rate for the Auction Period commencing on the Effective
Date shall be the Maximum Rate and the Auction Period shall be the Auction
Period determined without reference to the proposed change.

        4.      It is hereby represented, upon advice of the Auction Agent for
the Series __ Notes described herein, that there were Sufficient Bids for such
Series __ Notes at the Auction immediately preceding the date of this Notice.

        5.      Terms not defined in this Notice shall have the meanings set
forth in the Indenture entered into in connection with the Series __ Notes.

                                           [EDUCATION FUNDING CAPITAL TRUST-___]

Dated:                                     By:
       -------------------------              ----------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT G

                      NOTICE ESTABLISHING CHANGE IN LENGTH
                         OF ONE OR MORE AUCTION PERIODS

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

        Notice is hereby given that the Issuer hereby establishes new lengths
for one or more Auction Periods pursuant to the Indenture:

        1.      The change shall take effect on _______________, the Interest
Rate Adjustment Date for the next Auction Period (the "Effective Date").

        2.      For the Auction Period commencing on the Effective Date, the
Interest Rate Adjustment Date shall be _______________, or the next succeeding
Business Day if such date is not a Business Day.

        3.      For Auction Periods occurring after the Auction Period
commencing on the Effective Date, the Interest Rate Adjustment Date shall be
[_______________(date) and every ______________(number) ______________(day of
week) thereafter] [every ______________(number) ______________(day of week)
after the date set forth in paragraph 2 above], or the next Business Day if any
such day is not a Business Day; provided, however, that the length of subsequent
Auction Periods shall be subject to further change hereafter as provided in the
Indenture.

        4.      The changes described in paragraphs 2 and 3 above shall take
place only upon delivery of this Notice and the satisfaction of other conditions
set forth in the Indenture and our prior notice dated _______________ regarding
the proposed change.

        5.      Terms not defined in this Notice shall have the meanings set
forth in the Indenture relating to the Series __ Notes.

                                           [EDUCATION FUNDING CAPITAL TRUST-___]

Dated:                                     By:
       -------------------------              ----------------------------------

                                                              Indenture of Trust

<PAGE>

                                    EXHIBIT H

                        NOTICE OF CHANGE IN AUCTION DATE

                      [EDUCATION FUNDING CAPITAL TRUST-___]
                           EDUCATION LOAN BACKED NOTES
                                    SERIES __

        Notice is hereby given by __________, as Broker-Dealer for the Auction
Rate Notes identified above, that with respect to the Auction Rate Notes, the
Auction Date is hereby changed as follows:

        1.      With respect to Series __ Notes, the definition of "Auction
Date" shall be deemed amended by substituting "_______________(number) Business
Day" in the second line thereof and by substituting "_______________(number)
Business Days" for "two Business Days" in subsection (d) thereof.

        2.      This change shall take effect on _______________ which shall be
the Auction Date for the Auction Period commencing on _______________.

        3.      The Auction Date for the Series __ Notes shall be subject to
further change hereafter as provided in the Indenture.

        4.      Terms not defined in this Notice shall have the meaning set
forth in the Indenture relating to the Series __ Notes.

                                              __________, as Broker-Dealer

Dated:                                        By:
       -------------------------                 -------------------------------

                                                              Indenture of TrustPatent License and Research Collaboration Agreement

 Exhibit 10.25 
  
 PATENT LICENSE AND RESEARCH COLLABORATION AGREEMENT 
  
 between 
  
 MERCK & CO., INC. 
  
 and 
  
 RENOVIS, INC. 
  

	[*]	CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE
406 OF THE SECURITIES EXCHANGE ACT OF 1933, AS AMENDED. 

 TABLE OF CONTENTS 
  

	 1.
	 	 DEFINITIONS
	  	 
			
	 2.
	 	 RESEARCH PROGRAM
	  	 
				
	 	 	 2.1
	  	 General
	  	5
	 	 	 2.2
	  	 Conduct of Research
	  	6
	 	 	 2.3
	  	 Costs
	  	6
	 	 	 2.4
	  	 Principal Scientists
	  	6
	 	 	 2.5
	  	 Joint Research Committee
	  	6
	 	 	 2.6
	  	 Records and Reports
	  	7
	 	 	 2.7
	  	 Research Information and Inventions
	  	8
	 	 	 2.8
	  	 Initial Research Program Term
	  	9
	 	 	 2.9
	  	 Compliance
	  	9
	 	 	 2.10
	  	 Materials
	  	9
	 	 	 2.11
	  	 Exclusive Efforts
	  	9
	 	 	 2.12
	  	 Use of Human Materials
	  	10
			
	 3.
	 	 LICENSE; EXCHANGE OF INFORMATION; DEVELOPMENT AND COMMERCIALIZATION
	  	 
				
	 	 	 3.1
	  	 License Grant
	  	10
			
	 4.
	 	 CONFIDENTIALITY AND PUBLICATION
	  	 
				
	 	 	 4.1
	  	 Nondisclosure Obligation
	  	12
	 	 	 4.2
	  	 Information and Inventions
	  	13
	 	 	 4.3
	  	 Publication
	  	13
	 	 	 4.4
	  	 Publicity/Use of Names
	  	13
			
	 5.
	 	 RIGHTS OF PARTIES
	  	 
				
	 	 	 5.1
	  	 Preclinical Proof of Concept
	  	13
	 	 	 5.2
	  	 Effect of Finding Preclinical Proof of Concept
	  	14
	 	 	 5.3
	  	 Effect of Finding of Preclinical Proof of Concept for [*] and Not [*]
	  	15
	 	 	 5.4
	  	 Effect of Finding No Preclinical Proof of Concept Achieved
	  	16
			
	 6.
	 	 REPRESENTATIONS AND WARRANTIES
	  	 
				
	 	 	 6.1
	  	 Representation and Warranty
	  	16
	 	 	 6.2
	  	 Representations and Warranties of MERCK
	  	17
			
	 7.
	 	 PATENT PROVISIONS
	  	 
				
	 	 	 7.1
	  	 Filing, Prosecution and Maintenance of Patents
	  	17
	 	 	 7.2
	  	 Option of MERCK to Prosecute and Maintain Patents
	  	18
	 	 	 7.3
	  	 Interference, Opposition, Reexamination and Reissue
	  	18

  

	 	 	 7.4
	  	 Enforcement and Defense
	  	19
	 	 	 7.5
	  	 Patent Term Restoration
	  	20
			
	 8.
	 	 TERM AND TERMINATION
	  	 
				
	 	 	 8.1
	  	 Term and Expiration
	  	21
	 	 	 8.2
	  	 Termination by MERCK or RENOVIS
	  	21
	 	 	 8.3
	  	 Other Termination Events
	  	21
	 	 	 8.4
	  	 Effect of Expiration or Termination; Survival
	  	23
			
	 9.
	 	 MISCELLANEOUS
	  	 
				
	 	 	 9.1
	  	 Force Majeure
	  	24
	 	 	 9.2
	  	 Assignment
	  	24
	 	 	 9.3
	  	 Severability
	  	24
	 	 	 9.4
	  	 Notices
	  	25
	 	 	 9.5
	  	 Applicable Law
	  	25
	 	 	 9.6
	  	 Dispute Resolution
	  	 26

	 	 	 9.7
	  	 Entire Agreement; Amendments
	  	 27

	 	 	 9.8
	  	 Headings
	  	 27

	 	 	 9.9
	  	 Independent Contractors
	  	 27

	 	 	 9.10
	  	 Waiver
	  	 27

	 	 	 9.11
	  	 Cumulative Remedies
	  	 28

	 	 	 9.12
	  	 Waiver of Rule of Construction

	  	 28

	 	 	 9.13
	  	 Counterparts
	  	 28

  

	 SCHEDULE 1.12
	  	 MERCK PATENT RIGHTS

		
	 SCHEDULE 1.20
	  	 RENOVIS PATENT RIGHTS

		
	 SCHEDULE 2.1
	  	 INITIAL RESEARCH PROGRAM

		
	 SCHEDULE 5.1
	  	 CRITERIA TO DETERMINE

	 	  	 PRECLINICAL PROOF OF CONCEPT

  

 PATENT LICENSE AND RESEARCH COLLABORATION AGREEMENT 
  
 THIS AGREEMENT (the “Agreement”), effective as of July 15, 2003
(the “Effective Date”), is entered into by and between Merck & Co., Inc., a corporation organized and existing under the laws of the state of New Jersey (“MERCK”), and Renovis, Inc., a corporation organized and existing under
the laws of the state of Delaware (“RENOVIS”). 
  
 RECITALS: 
  
 WHEREAS, RENOVIS has
developed RENOVIS Technology (as hereinafter defined) and has rights to RENOVIS Patent Rights (as hereinafter defined); 
  
 WHEREAS, MERCK has developed proprietary small molecule [*] compounds and has rights to MERCK Patent Rights; 
  
 WHEREAS, MERCK and RENOVIS desire to enter into a research
collaboration to explore the use of small molecule [*] in [*]; and 
  
 WHEREAS, if such research collaboration is successful, the parties desire to enter into certain further business relationships upon the terms and conditions set forth herein. 
  
 NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants herein contained, the Parties hereby agree as follows: 
  

	1.	DEFINITIONS 

  
 Unless specifically set forth to the contrary herein, the following terms, whether used in the singular or plural, shall have the
respective meanings set forth below: 
  

	 	1.1	“Affiliate” shall mean (i) any corporation or business entity of which fifty percent (50%) or more of the securities or other ownership interests
representing the equity, the voting stock or general partnership interest are owned, controlled or held, directly or indirectly, by MERCK or RENOVIS; or (ii) any corporation or business entity which, directly or indirectly, owns, controls or holds
fifty percent (50%) (or the maximum ownership interest permitted by law) or more of the securities or other ownership interests representing the equity, the voting stock or, if applicable, the general partnership interest, of MERCK or RENOVIS; or
(iii) any corporation or business entity of which fifty percent (50%) or more of the securities or other ownership interests representing the equity, the voting stock or general partnership interest are owned, controlled or held, directly or
indirectly, by a corporation or business entity described in (i) or (ii). 

  

	 	1.2	“Committee” shall mean the joint research committee established to facilitate the Initial Research Program as more fully described in Section 2.5.1.

  

 2 

	 	1.3	“Control”, “Controls” or “Controlled by” shall mean either (a) being an Affiliate of either MERCK or RENOVIS; or (b) with respect to any
item of or right under Patent Rights or Know-How, the possession of (whether by ownership or license, other than pursuant to this Agreement) or the ability of a Party to grant access to, or a license or sublicense of, such items or right as provided
for herein without violating the terms of any agreement or other arrangement with any Third Party existing at the time such Party would be required hereunder to grant the other Party such access or license or sublicense. 

  

	 	1.4	“Field” shall mean the treatment of [*]. 

  

	 	1.5	“Improvement” shall mean any enhancement, whether or not patentable, to a preexisting (prior to the date of this Agreement) Invention or Know-How of MERCK or
RENOVIS conceived and/or reduced to practice in the course of the Initial Research Program. 

  

	 	1.6	“IND” shall mean an Investigational New Drug application, Clinical Study Application, Clinical Trial Exemption, or similar application or submission for
approval to conduct human clinical investigations filed with or submitted to a Regulatory Authority in conformance with the requirements of such Regulatory Authority. 

  

	 	1.7	“Initial Research Program Term” shall mean the duration of the Initial Research Program, as described more fully in Section 2.8.

  

	 	1.8	“Initial Research Program” shall mean the research activities undertaken by the Parties hereto as set forth in Article 2 and Schedule 2.1 and the
determination of whether Preclinical Proof of Concept has been achieved, as set forth in Article 5 and Schedule 5.1. 

  

	 	1.9	“Invention” means any process, method, composition of matter, article of manufacture, discovery or finding that is conceived and/or reduced to practice in
the course of the Initial Research Program. 

  

	 	1.10	“Joint Information and Inventions” shall mean all discoveries, Improvements, processes, methods, protocols, formulas, data, Inventions, know-how and trade
secrets, patentable or otherwise, arising from the Initial Research Program developed or invented jointly by employees of MERCK and RENOVIS or others acting on behalf of MERCK and RENOVIS. 

  

	 	1.11	“MERCK Information and Inventions” shall mean all discoveries, Improvements, processes, methods, protocols, formulas, data, Inventions, know-how and trade
secrets, patentable or otherwise, arising from the Initial Research Program developed or invented solely by employees of MERCK or other persons not employed by RENOVIS acting on behalf of MERCK. 

  

 3 

	 	1.12	“MERCK Patent Rights” shall mean any and all patents and patent applications in the Territory which, for the purposes of this Agreement, shall be deemed to
include certificates of invention and applications for certificates of invention which, during the term of this Agreement, are Controlled by MERCK, including, but not limited to, those listed on Schedule 1.12, which (i) claim the Research Compound;
and (ii) are necessary in connection with the performance of the Initial Research Program. 

  

	 	1.13	“Party” shall mean MERCK and RENOVIS. 

  

	 	1.14	“[*] Candidate” shall mean a [*] compound Controlled by MERCK (with right to sublicense), with properties and characteristics similar to those of the
Research Compound, which (i) has entered into Phase I Clinical Trials at the time of determination of Preclinical Proof of Concept as set forth in the Initial Research Program [*]; and (ii) in MERCK’s sole discretion (x) can be licensed to
RENOVIS as contemplated by the terms of this Agreement and without violating the terms of any agreement or other arrangement with any Third Party; and (y) [*]. 

  

	 	1.15	“Phase I Clinical Trial” shall mean a human clinical trial in any country that is intended to initially evaluate the safety and/or pharmacological or
antigenic effect of a Product in human subjects or that would otherwise satisfy the requirements of 21 CFR 312.21(a). 

  

	 	1.16	“Product(s)” shall mean any preparations in final form for sale by prescription, over-the-counter or any other method for any and all uses in the Field,
including without limitation any Combination Product. 

  

	 	1.17	“Related Party” shall mean MERCK and its Affiliates (which term does not include distributors). 

  

	 	1.18	“RENOVIS Information and Inventions” shall mean all discoveries, Improvements, processes, methods, protocols, formulas, data, Inventions, know-how and trade
secrets, patentable or otherwise, arising from the Initial Research Program developed or invented solely by employees of RENOVIS or other persons not employed by MERCK acting on behalf of RENOVIS. 

  

	 	1.19	“RENOVIS Know-How” shall mean all information and materials, including but not limited to, discoveries, Improvements, processes, methods, protocols,
formulas, data, inventions (including without limitation RENOVIS Information and Inventions and RENOVIS’ rights in Joint Information and Inventions), know-how and trade secrets, patentable or otherwise, which during the term of this Agreement
(i) are in the possession or Control of RENOVIS or its Affiliates, (ii) are not generally known and (iii) are necessary or useful to MERCK in the Field, including without limitation, in connection with the Initial Research Program. RENOVIS Know-How
shall include, but not be limited to, RENOVIS Technology. 

  

 4 

	 	1.20	“RENOVIS Patent Rights” shall mean any and all patents and patent applications in the Territory which, for the purposes of this Agreement, shall be deemed to
include certificates of invention and applications for certificates of invention which, during the term of this Agreement are Controlled by RENOVIS, including, but not limited to, those listed on Schedule 1.20 which are necessary in connection with
the performance of the Initial Research Program. 

  

	 	1.21	“RENOVIS Technology” shall mean specific assay technology, not previously known and not in the public domain, that is Controlled by Renovis, and relates to
discovery and research activities in the Field and is necessary for the performance of the Initial Research Program, including, but not limited to, [*]. 

  

	 	1.22	“Research Compound” shall mean a [*] compound Controlled (with right to sublicense) by Merck, as specified by Merck in its sole discretion. The compound will
[*]. 

  

	 	1.23	“Territory” shall mean all of the countries in the world, and their territories and possessions. 

  

	 	1.24	“Third Party” shall mean an entity other than MERCK and its Related Parties, and RENOVIS and its Affiliates. 

  

	2.	RESEARCH PROGRAM 

  

	 	2.1	General 

  
 RENOVIS and MERCK shall engage in the Initial Research Program upon the terms and conditions set forth in this Agreement. The Initial Research Program
will involve Preclinical Proof of Concept research in the Field on the Research Compound. The Research Compound will be tested by Renovis [*] assays, and the results shall be evaluated by the Parties to determine efficacy in the Field, as set
forth in this Agreement. The activities to be undertaken in the course of the Initial Research Program are more specifically set forth in Schedules 2.1 and 5.1 which may be amended from time to time upon the mutual written agreement by authorized
representatives of the Parties. The rights of the Parties upon conclusion of the Initial Research Program are set forth in Article 5 of this Agreement. 
  

 5 

	 	2.2	Conduct of Research 

  
 RENOVIS shall conduct the Initial Research Program in good scientific manner, and in compliance in all material respects with all requirements of
applicable laws, rules and regulations and all applicable good laboratory practices to attempt to achieve their objectives efficiently and expeditiously. RENOVIS shall proceed diligently with the work set out in the Research Program by using
good-faith efforts to allocate sufficient time, effort, equipment and facilities to the Initial Research Program and to use personnel with sufficient skills and experience as are required to accomplish the Initial Research Program in accordance with
the terms of this Agreement and Schedules 2.1 and 5.1. 
  
 RENOVIS shall be entitled to utilize the service of Third Parties to perform its Initial Research Program activities only upon the prior written consent of MERCK or as specifically set forth in Schedule 2.1. RENOVIS shall ensure: (i) by
confidentiality agreement that all such Third Parties and their personnel, employees and agents involved in the Initial Research Program shall comply with the confidentiality provisions of this Agreement; and (ii) that each such Third Party and its
personnel, employees and agents that work on the Initial Research Program are qualified by appropriate experience and qualifications to perform the work assigned in a capable and professional matter. 
  

	 	2.3	Costs 

  
 RENOVIS shall assume all costs for the Initial Research Program. 
  

	 	2.4	Principal Scientists 

  
 The principal scientists for the Research Program are [*] for RENOVIS and [*] for MERCK. The Research Program and all work assignments to be performed by
RENOVIS and MERCK shall be carried out under the direction and supervision of the principal scientists noted above. Each Party shall notify the other Party as soon as practicable upon the changing of principal scientist; provided,
however, in no event may RENOVIS assign a principal scientist other than the individual identified above without the prior written consent of MERCK. 
  

	 	2.5	Joint Research Committee 

  
 The Parties hereby establish a committee to facilitate the Research Program as follows: 
  

	 	2.5.1	 Composition of the Joint Research Committee. The Initial Research Program shall be conducted under the direction of a joint research
committee (the “Committee”) comprised of three (3) named representatives of MERCK and three (3) named representatives of RENOVIS. Each Party shall appoint its respective representatives to the 

  

 6 

	 	 
Committee, and may substitute one or more of its representatives, in its sole discretion, effective upon notice to the other Party of such change. These
representatives shall have appropriate technical credentials, experience and knowledge, and ongoing familiarity with the Initial Research Program. Additional representatives or consultants may from time to time, by mutual consent of the Parties, be
invited to attend Committee meetings, subject to such representative’s and consultant’s written agreement to comply with the requirements of Section 4.1. The Committee shall be chaired by a representative of MERCK. Decisions of the
Committee shall be made unanimously by the members. In the event that the Committee cannot or does not, after good-faith efforts, reach agreement on an issue, the resolution and/or course of conduct shall first be determined by the Chief Executive
Officer of RENOVIS and a Vice President of MERCK; if they are unable to reach agreement, then resolution shall be made by a MERCK Executive Vice President, in his/her sole discretion. Each Party shall bear its own expenses related to the attendance
of such meetings by its representatives. 

  

	 	2.5.2	Meetings. The Committee shall meet in accordance with a schedule established by mutual written agreement of the Parties, but no less frequently than once
per quarter, with the location for such meetings alternating between RENOVIS and MERCK facilities (or such other locations as is determined by the Committee). Alternatively, the Committee may meet by means of teleconference, videoconference or other
similar communications equipment. The Committee shall confer regarding the status of the Initial Research Program, review relevant data, consider and advise on any technical issues that arise, consider issues of priority, and review and advise on
any budgetary and economic matters relating to the Initial Research Program which is referred to the Committee. 

  

	 	2.5.3	Project Leaders. MERCK and RENOVIS each shall appoint a person (a “Project Leader”) from the Committee to coordinate its part of the Initial
Research Program. The Project Leaders shall be the primary contact between the Parties with respect to the Initial Research Program. Each Party shall notify the other within thirty (30) days of the date of the Agreement of the appointment of its
Project Leader and shall notify the other Party as soon as practicable upon changing this appointment. 

  

	 	2.6	Records and Reports 

  

	 	2.6.1	Records. RENOVIS shall maintain records, in sufficient detail and in good scientific manner appropriate for patent and regulatory purposes, which shall
fully and properly reflect all work done, costs incurred and results achieved in the performance of the Initial Research Program by RENOVIS. 

  

 7 

	 	2.6.2	Copies and Inspection of Records. MERCK shall have the right, during normal business hours and upon reasonable notice, to inspect and copy all such
records of the RENOVIS referred to in Section 2.6.1. MERCK shall maintain such records and the information disclosed therein in confidence in accordance with Section 4.1. MERCK shall have the right to arrange for its employees and/or consultants
involved in the activities contemplated hereunder to visit the offices and laboratories of RENOVIS and any of its Third Party contractors as permitted under Section 2.2 during normal business hours and upon reasonable notice, and to discuss the
Initial Research Program work and its results in detail with the technical personnel and consultants of RENOVIS. Upon request, RENOVIS shall provide copies of the records described in Section 2.6.1 above. 

  

	 	2.6.3	Quarterly Reports. Within thirty (30) days following the end of each calendar quarter during the term of this Agreement, RENOVIS shall provide to MERCK a
written progress report in English which shall describe the work performed to date on the Initial Research Program, deliver the results (including all data) of such work, evaluate the work performed in relation to the goals of the Initial Research
Program and provide such other information required by the Initial Research Program or reasonably requested by MERCK relating to the progress of the goals or performance of the Initial Research Program. 

  

	 	2.7	Research Information and Inventions 

  
 Subject to the licenses granted pursuant to the terms of this Agreement, the entire right, title and interest in: 
  

	 	(a)	RENOVIS Information and Inventions shall be owned solely by RENOVIS; 

  

	 	(b)	MERCK Information and Inventions shall be owned solely by MERCK; and 

  

	 	(c)	Joint Information and Inventions shall be owned jointly by RENOVIS and MERCK. 

  
 Notwithstanding the above, any Inventions that are Improvements to RENOVIS Patent Rights or RENOVIS Technology shall be
owned by RENOVIS and any Inventions that are Improvements to MERCK Patent Rights shall be owned by MERCK, subject in all cases to the licenses granted pursuant to the terms of this Agreement. 
  

 8 

	 	2.8	Initial Research Program Term 

  
 Except as otherwise provided herein, the term of the Initial Research Program shall commence on the Effective Date and continue for a period of nine (9)
months. The Parties may extend the term of the Initial Research Program by mutual written agreement of the authorized representative of the Parties, and shall, in such case, amend Schedules 2.1 and 5.1, as applicable. 
  

	 	2.9	Compliance 

  
 RENOVIS shall conduct the research in accordance with all applicable laws, rules and regulations, including, without limitation, all current governmental
regulatory requirements concerning Good Laboratory Practices. In addition, if animals are used in research hereunder, RENOVIS will comply with the Animal Welfare Act or any other applicable local, state, national and international laws or
regulations relating to the care and use of laboratory animals. MERCK encourages RENOVIS to use the highest standards, such as those set forth in the Guide for the Care and Use of Laboratory Animals (NRC, 1996), for the humane handling, care and
treatment of such research animals. Any animals which are used in the course of the Research, or products derived from those animals, such as eggs or milk, will not be used for food purposes, nor will these animals be used for commercial breeding
purposes. RENOVIS shall notify MERCK in writing of any deviations from applicable regulatory or legal requirements. RENOVIS hereby certifies that it will not and has not to its knowledge employed or otherwise used in any capacity the services of any
person debarred under Section 21 USC 335a in performing any services hereunder. 
  

	 	2.10	Materials 

  
 MERCK shall provide RENOVIS with sufficient quantities of the Research Compound as set forth in Schedule 2.1 solely for the purposes of carrying out
RENOVIS’ respective activities under the Research Program in accordance with the terms of this Agreement. The Research Compound is not to be used in humans, nor shall it, or any derivatives, analogs, modifications or components thereof, be
transferred, delivered or disclosed to any Third Party without the prior written approval of MERCK. Any unused Research Compound shall be, at MERCK’s option, either returned to MERCK, or destroyed in accordance with instructions by MERCK.

  

	 	2.11	Exclusive Efforts 

  
 During the Research Program Term, RENOVIS shall work exclusively (even as to RENOVIS itself) with MERCK in efforts on small molecule [*] compounds in the
Field. 
  

 9 

	 	2.12	Use of Human Materials 

  
 If any human cell lines, tissue, human clinical isolates or similar human-derived materials (“Human Materials”) have been or are to be
collected and/or used in the Initial Research Program, RENOVIS represents and warrants (i) that it has complied, or shall comply, with all applicable laws, guidelines and regulations relating to the collection and/or use of the Human Materials and
(ii) that it has obtained, or shall obtain, all necessary approvals and appropriate informed consents, in writing, for the collection and/or use of such Human Materials. RENOVIS shall provide documentation of such approvals and consents upon
MERCK’s request. RENOVIS further represents and warrants that such Human Materials may be used as contemplated in this Agreement without any obligations to the individuals or entities (“Providers”) who contributed the Human Materials,
including, without limitation, any obligations of compensation to such Providers or any other Third Party for the intellectual property associated with, or commercial use of, the Human Materials for any purposes. 
  

	3.	LICENSE; EXCHANGE OF INFORMATION; DEVELOPMENT AND COMMERCIALIZATION 

  

	 	3.1	License Grant 

  

	 	(a)	MERCK hereby grants to RENOVIS, subject to existing Third Party rights, an exclusive research license (even as to MERCK) for internal research purposes only, without the
right to sublicense, during the Initial Research Program under the MERCK Patent Rights, solely for the purposes of conducting the Initial Research Program in the Field in the Territory. 

  

	 	(b)	RENOVIS hereby grants to MERCK: (i) a non-exclusive license to RENOVIS Information and Inventions and RENOVIS’ interest in Joint Information and Inventions which are not
Improvements to RENOVIS Technology or Improvements to Inventions covered by RENOVIS Patent Rights, for any and all uses in the Territory outside the Field; and (ii) a non-exclusive research license for internal research purposes only to
RENOVIS’ interest in Joint Information and Inventions which are Improvements to RENOVIS Technology for any and all uses in the Territory outside of the Field; and (iii) an exclusive license (even as to RENOVIS) with right to sublicense to
RENOVIS Information and Inventions and RENOVIS’ interest in all Joint Information and Inventions that are Improvements to Inventions covered by MERCK Patent Rights for any and all uses in the Territory. 

  

	 	(c)	 MERCK hereby grants to RENOVIS, subject to existing Third Party rights: (i) a non-exclusive, non-sublicensable research license for internal research
purposes only to MERCK Information and Inventions and MERCK’s interest in Joint 

  

 10 

	 	 
Information and Inventions that are not Improvements to Inventions covered by MERCK Patent Rights in the Territory in the Field; and (ii) an exclusive
license with right to sublicense to MERCK’s interest in all Joint Information and Inventions that are Improvements to RENOVIS Technology or Improvements to Inventions covered by Renovis Patent Rights for any and all uses in the Territory.

  

 11 

	4.	CONFIDENTIALITY AND PUBLICATION 

  

	 	4.1	Nondisclosure Obligation 

  
 All information disclosed by one Party to the other Party hereunder (the “Information”) shall be maintained in confidence by the receiving
Party and shall not be disclosed to non-Party or used for any purpose except as set forth herein without the prior written consent of the disclosing Party, except to the extent that such Information: 
  

	 	(a)	is known by receiving Party at the time of its receipt, and not through a prior disclosure by the disclosing Party, as documented by the receiving Party’s business
records; 

  

	 	(b)	is properly in the public domain; 

  

	 	(c)	is subsequently disclosed to the receiving Party by a Third Party who may lawfully do so and is not under an obligation of confidentiality to the disclosing Party;

  

	 	(d)	is developed by the receiving Party independently of Information received from the disclosing Party, as documented by the receiving Party’s business records;

  

	 	(e)	is disclosed to governmental or other regulatory agencies in order to obtain patents or to gain or maintain approval to conduct clinical trials or to market Product, but such
disclosure may be only to the extent reasonably necessary to obtain patents or authorizations; 

  

	 	(f)	is deemed necessary by MERCK to be disclosed to Related Parties, consultants, and/or other Third Parties for any and all purposes Merck and its Affiliates deem necessary or
advisable in the ordinary course of business in accordance with this Agreement on the condition that such Third Parties agree to be bound by the confidentiality and non-use obligations contained in this Agreement; provided the term of
confidentiality for such Third Parties shall be no less than ten (10) years. 

  
 Any combination of features or disclosures shall not be deemed to fall within the foregoing exclusions merely because individual features are published or available to the general public or in the rightful possession
of the receiving Party unless the combination itself and principle of operation are published or available to the general public or in the rightful possession of the receiving party. 
  
 If a Party is required by judicial or administrative process to disclose Information that is subject to the non-disclosure
provisions of this Section 4.1 or Section 4.2, such Party shall promptly inform the other Party of the disclosure that is being sought in order to provide the other Party an opportunity to challenge or limit the 

  

 12 

 
disclosure obligations. Information that is disclosed by judicial or administrative process shall remain otherwise subject to the confidentiality and non-use
provisions of this Section 4.1 and Section 4.2, and the Party disclosing Information pursuant to law or court order shall take all steps reasonably necessary, including without limitation obtaining an order of confidentiality, to ensure the
continued confidential treatment of such Information. 
  

	 	4.2	Information and Inventions 

  
 During the term on this Agreement, RENOVIS agrees to keep confidential (i) all RENOVIS Information and Inventions; and (ii) all Joint Information and
Inventions, each to the extent directly arising from the Initial Research Program, subject to the exceptions in Section 4.1. 
  
 Notwithstanding the previous paragraph, in the event this Agreement is terminated by RENOVIS pursuant to Section 8.2, or by MERCK pursuant to Section
8.3.1(c), RENOVIS agrees to keep confidential (i) all RENOVIS Information and Inventions; and (ii) all Joint Information and Inventions, each to the extent directly arising from the Initial Research Program, for a period of five (5) years after the
effective date of termination, subject to the exceptions in Section 4.1(b), (c) and (e). 
  

	 	4.3	Publication 

  
 Neither Party shall have the right to publish results of the Initial Research Program unless approved in advance in writing by the Committee and the
Executive Vice President for Neuroscience of MERCK. 
  

	 	4.4	Publicity/Use of Names 

  
 No disclosure of the existence of, or the terms of, this Agreement may be made by either Party, and no Party shall use the name, trademark, trade name or
logo of the other Party or its employees in any publicity, news release or disclosure relating to this Agreement or its subject matter, without the prior express written permission of the other Party, except as may be required by law. 
  

	5.	RIGHTS OF PARTIES UPON CONCLUSION OF INITIAL RESEARCH PROGRAM 

  

	 	5.1	Preclinical Proof of Concept 

  
 Upon conclusion of the Initial Research Program activities as set forth in Section 2.1, the Committee will evaluate the results to determine whether
Preclinical Proof of Concept has been achieved on the Research Compound for [*]. 
  

 13 

	 	5.2	Effect of Finding of Preclinical Proof of Concept 

  
 In the event that the Committee determines that Preclinical Proof of Concept on the Research Compound has been achieved [*] and: 
  

	 	(a)	MERCK has [*] Candidate, then: 

  

	 	(i)	MERCK and RENOVIS will enter into good-faith negotiations to enter into a License and Research Collaboration Agreement to jointly research and develop a [*] Candidate in the
Field (for [*] indications, provided the Committee has determined that Preclinical Proof of Concept on the Research Compound has been achieved for [*] pursuant to the criteria set forth in Schedule 5.1) (the “[*] Agreement”). The [*]
Agreement shall be subject to existing Third Party rights and on commercially reasonable terms to be negotiated by the parties in good faith, which terms shall include: 

  

	 	(x)	that research would focus on IND-enabling preclinical studies, leading to a “go/no-go” decision regarding filing an IND for [*] Candidate for use in the Field;

  

	 	(y)	clinical development activities would be conducted primarily by MERCK, with such support by RENOVIS as the parties determine is appropriate; 

  

	 	(z)	in the event the Parties decide not to file the IND for the [*] Candidate for use in [*], and MERCK elects to terminate the collaboration, then RENOVIS would have the right
to proceed with the [*] Candidate as a Licensed Compound for use in [*] under the option provided pursuant to Section 5.3 (assuming the research results support proceeding); 

  

	 	(xx)	in the event that research results do not support proceeding, the entire collaboration shall terminate; 

  

	 	(yy)	MERCK would have the exclusive right to commercialize (market and sell) any approved product (including a pharmaceutically acceptable formulation and, if needed, delivery
means) for use in the Field, such activities would be at MERCK’s sole responsibility and discretion, subject to satisfying standard diligence obligations; and 

  

	 	(zz)	commercially reasonable financial terms, including research funding (as appropriate), milestones and royalties to be paid by MERCK to RENOVIS; or 

  

 14 

	 	(b)	MERCK does not have a [*] Candidate, then: 

  

	 	(i)	the Agreement terminates pursuant to the terms of Article 8 of this Agreement. 

  

	 	5.3	Effect of Finding of Preclinical Proof of Concept for [*] and Not [*] 

  
 In the event the Committee determines that Preclinical Proof of Concept on the Research Compound has been achieved for [*]
and not [*] and: 
  

	 	(a)	MERCK has a [*] Candidate, then: 

  

	 	(i)	MERCK and RENOVIS will enter into good-faith negotiations to enter into a license agreement (which may be exclusive or non-exclusive, depending on MERCK’s rights to such
compound) granting RENOVIS rights to the [*] Candidate for research, development and commercialization in the Field (“Licensed Compound”) on commercially reasonable terms to be negotiated by the parties in good faith, which terms shall
include: (a) royalties on product sales in the Field to be paid by RENOVIS to MERCK; (b) RENOVIS will covenant that RENOVIS (and its Affiliates) will not develop, make, market or promote the Licensed Compound for any use other than in the Field; (c)
if Renovis does not file an IND for Licensed Compound in the Field within two (2) years of executing a license agreement for a [*] Candidate, all rights granted to RENOVIS by MERCK to the Licensed Compound will revert exclusively to Merck; (d)[*]
and (e) subject to existing Third Party rights,[*]. Notwithstanding the above, in the event that MERCK proposes to provide RENOVIS a license to a [*] Candidate which is subject to Third Party obligations [*]. 

  

	 	(b)	MERCK does not have a [*] Candidate, then: 

  

	 	(i)	the Agreement terminates pursuant to the terms of Article 8 of this Agreement. 

  

 15 

	 	5.4	Effect of Finding No Preclinical Proof of Concept Achieved. 

  
 If Preclinical Proof of Concept is not achieved on the Research Compound, the Agreement terminates pursuant to the terms of Article 8 of this Agreement.

  

	6.	REPRESENTATIONS AND WARRANTIES 

  

	 	6.1	Representation and Warranty 

  
 RENOVIS represents and warrants to MERCK as of the Effective Date that: 
  

	 	(a)	to the best of RENOVIS’ knowledge, the RENOVIS Patent Rights and RENOVIS Know-How exist and are not invalid or unenforceable, in whole or in part;

  

	 	(b)	it has the full right, power and authority to enter into this Agreement, to perform the Initial Research Program and to grant the licenses granted under Article 3 hereof;

  

	 	(c)	it has not previously assigned, transferred, conveyed or otherwise encumbered its right, title and interest in RENOVIS Patent Rights or RENOVIS Know-How in a manner
inconsistent with the rights granted to MERCK hereunder; 

  

	 	(d)	to the best of RENOVIS’ knowledge, it is the sole and exclusive owner of the RENOVIS Patent Rights and RENOVIS Know-How, all of which are (and shall be, in the case of
RENOVIS Information and Inventions) free and clear of any liens, charges and encumbrances, and no other person, corporate or other private entity, or governmental entity or subdivision thereof, has or shall have any claim of ownership whatsoever
with respect to the RENOVIS Patent Rights and RENOVIS Know-How; 

  

	 	(e)	to the best of RENOVIS’ knowledge, the exercise of the license granted to MERCK under the RENOVIS Patent Rights and RENOVIS Know-How do not interfere with or infringe
any intellectual property rights owned or possessed by any Third Party; 

  

	 	(f)	there are no claims, judgments or settlements against or owed by RENOVIS or pending or threatened claims or litigation relating to the RENOVIS Patent Rights and RENOVIS
Know-How; and 

  

	 	(g)	RENOVIS has disclosed to MERCK all reasonably relevant information regarding the RENOVIS Patent Rights and RENOVIS Know-How licensed under this Agreement, including without
limitation all patent opinions obtained by RENOVIS related thereto. 

  

 16 

	 	6.2	Representations and Warranties of MERCK. 

  
 MERCK represents and warrants to RENOVIS as of the Effective Date that: 
  

	 	(a)	to the best of MERCK’s knowledge, the MERCK Patent Rights exist and are not invalid or unenforceable, in whole or in part; 

  

	 	(b)	it has the full right, power and authority to enter into this Agreement, to meet its obligations with respect to the Initial Research Program and to grant the licenses granted under
Article 3 hereof; 

  

	 	(c)	it has not previously assigned, transferred, conveyed or otherwise encumbered its right, title and interest in MERCK Patent Rights in any manner that is inconsistent with the
licenses granted to RENOVIS hereunder;; 

  

	 	(d)	to the best of MERCK’s knowledge, the MERCK Patent Rights are free and clear of any liens, charges and other similar encumbrances; 

  

	 	(e)	to the best of MERCK’s knowledge, the exercise of the license granted to RENOVIS under the MERCK Patent Rights does not interfere with or infringe any intellectual property
rights owned or possessed by any Third Party; 

  

	 	(f)	there are no claims, judgments or settlements against or owed by MERCK or pending or threatened claims or litigation relating to the MERCK Patent Rights; and

  

	 	(g)	MERCK has disclosed to RENOVIS all information reasonably relevant to RENOVIS’ performance of the Initial Research Program regarding the MERCK Patent Rights licensed
under this Agreement. Notwithstanding the above, [*]. 

  

	7.	PATENT PROVISIONS 

  

	 	7.1	Filing, Prosecution and Maintenance of Patents 

  
 RENOVIS agrees to file, prosecute and maintain in the Territory, upon appropriate consultation with MERCK, the RENOVIS Patent Rights licensed to MERCK
under this Agreement; provided, however, with respect to Joint Information and Inventions that are not Improvements to RENOVIS Patent Rights or RENOVIS Technology, MERCK shall have the first right to file patent applications for such
Joint Information and Inventions. With respect to RENOVIS Information and Inventions, RENOVIS may elect not to file and if so MERCK shall have the right to file patent applications. In such event, RENOVIS shall execute such documents and perform
such acts at RENOVIS’ expense as 

  

 17 

 
may be reasonably necessary to effect an assignment of such Patent Rights to MERCK in a timely manner to allow MERCK to continue such prosecution or
maintenance. In each case, the filing Party shall give the non-filing Party an opportunity to review the text of the application before filing, shall consult with the non-filing Party with respect thereto, and shall supply the non-filing Party with
a copy of the application as filed, together with notice of its filing date and serial number. RENOVIS shall keep MERCK advised of the status of the actual and prospective patent filings and upon the request of MERCK, provide advance copies of any
papers related to the filing, prosecution and maintenance of such patent filings. RENOVIS shall promptly give notice to MERCK of the grant, lapse, revocation, surrender, invalidation or abandonment of any Patent Rights licensed to MERCK for which
RENOVIS is responsible for the filing, prosecution and maintenance. With respect to all filings hereunder, the filing Party shall be responsible for payment of all costs and expenses related to such filings. 
  

	 	7.2	Option of MERCK to Prosecute and Maintain Patents 

  
 RENOVIS shall give notice to MERCK of any desire to cease prosecution and/or maintenance of RENOVIS Patent Rights on a country by country basis in the
Territory and, in such case, shall permit MERCK, at its sole discretion, to continue prosecution or maintenance of such Patent Rights at its own expense. If MERCK elects to continue prosecution or maintenance or to file based on RENOVIS’
election not to file pursuant to Section 7.1 above, RENOVIS shall execute such documents and perform such acts at RENOVIS’ expense as may be reasonably necessary to effect an assignment of such Patent Rights to MERCK in a timely manner to allow
MERCK to continue such prosecution or maintenance. Any patents or patent applications so assigned shall not be considered Patent Rights. 
  

	 	7.3	Interference, Opposition, Reexamination and Reissue 

  

	 	(a)	RENOVIS shall, within ten (10) days of learning of such event, inform MERCK of any request for, or filing or declaration of, any interference, opposition, or reexamination relating
to Patent Rights. MERCK and RENOVIS shall thereafter consult and cooperate fully to determine a course of action with respect to any such proceeding. MERCK shall have the right to review and approve any submission to be made in connection with such
proceeding. 

  

	 	(b)	RENOVIS shall not initiate any reexamination, interference or reissue proceeding relating to RENOVIS Patent Rights without the prior written consent to MERCK, which consent shall
not be unreasonably withheld. 

  

	 	(c)	 In connection with any interference, opposition, reissue, or reexamination proceeding relating to RENOVIS Patent Rights, MERCK and RENOVIS 

  

 18 

	 	 
will cooperate fully and will provide each other with any information or assistance that either may reasonably request. RENOVIS shall keep MERCK informed of
developments in any such action or proceeding, including, to the extent permissible by law, consultation and approval of any settlement, the status of any settlement negotiations and the terms of any offer related thereto.

  

	 	(d)	RENOVIS shall bear the expense of any interference, opposition, reexamination, or reissue proceeding relating to RENOVIS Patent Rights. 

  

	 	7.4	Enforcement and Defense 

  

	 	(a)	RENOVIS shall give MERCK notice of either (i) any infringement of Patent Rights, or (ii) any misappropriation or misuse of RENOVIS Know-How, that may come to RENOVIS’
attention. MERCK and RENOVIS shall thereafter consult and cooperate fully to determine a course of action, including but not limited to the commencement of legal action by either or both MERCK and RENOVIS, to terminate any infringement of Patent
Rights or any misappropriation or misuse of RENOVIS Know-How. However, RENOVIS, upon notice to MERCK, shall have the first right to initiate and prosecute such legal action at its own expense and in the name of RENOVIS and MERCK, or to control the
defense of any declaratory judgment action relating to Patent Rights or RENOVIS Know-How. RENOVIS shall promptly inform MERCK if it elects not to exercise such first right and MERCK shall thereafter have the right to either initiate and prosecute
such action or to control the defense of such declaratory judgment action in the name of MERCK and, if necessary, RENOVIS. Each Party shall have the right to be represented by counsel of its own choice. 

  

	 	(b)	In the event that RENOVIS elects not to initiate and prosecute an action as provided in paragraph (a), and MERCK elects to do so, the costs of any agreed-upon course of
action to terminate infringement of RENOVIS Patent Rights or misappropriation or misuse of RENOVIS Know-How, including without limitation the costs of any legal action commenced or the defense of any declaratory judgment, shall be shared equally by
RENOVIS and MERCK. 

  

	 	(c)	 For any action to terminate any infringement of Patent Rights or any misappropriation or misuse of RENOVIS Know-How, in the event that MERCK is unable to
initiate or prosecute such action solely in its own name, RENOVIS will join such action voluntarily and will execute and cause its Affiliates to execute all documents necessary for MERCK to initiate litigation to prosecute and maintain such action.
In connection with any action, MERCK and RENOVIS will cooperate fully and will 

  

 19 

	 	 
provide each other with any information or assistance that either may reasonably request. Each Party shall keep the other informed of developments in any
action or proceeding, including, to the extent permissible by law, the consultation and approval of any settlement negotiations and the terms of any offer related thereto. 

  

	 	(d)	Any recovery obtained by either or both MERCK and RENOVIS in connection with or as a result of any action contemplated by this section, whether by settlement or otherwise,
shall be shared in order as follows: 

  

	 	(i)	the Party which initiated and prosecuted the action shall recoup all of its costs and expenses incurred in connection with the action; 

  

	 	(ii)	the other Party shall then, to the extent possible, recover its costs and expenses incurred in connection with the action; and 

  

	 	(iii)	the amount of any recovery remaining shall then be allocated between the Parties on a pro rata basis taking into consideration the relative economic losses
suffered by each Party. 

  

	 	(e)	RENOVIS shall inform MERCK of any certification regarding any Patent Rights it has received pursuant to either 21 U.S.C. §§355(b)(2)(A)(iv) or (j)(2)(A)(vii)(IV) or
it successor provisions or any similar provisions in a country in the Territory other than the United States and shall provide MERCK with a copy of such certification within five (5) days of receipt. RENOVIS’ and MERCK’s rights with
respect to the initiation and prosecution of any legal action as a result of such certification or any recovery obtained as a result of such legal action shall be as defined in paragraphs 7.4(a)-(d) hereof; provided, however, the
RENOVIS shall exercise its first right to initiate and prosecute any action and shall inform MERCK of such decision within ten (10) days of receipt of the certification, after which time MERCK shall have the right to initiate and prosecute such
action. 

  

	 	7.5	Patent Term Restoration 

  
 The Parties hereto shall cooperate with each other in obtaining patent term restoration or supplemental protection certificates or their equivalents in
any country in the Territory where applicable to Patent Rights. In the event that elections with respect to obtaining such patent term restoration are to be made, MERCK shall have the right to make the election and RENOVIS agrees to abide by such
election. 
  

 20 

	8.	TERM AND TERMINATION 

  

	 	8.1	Term and Expiration 

  
 This Agreement shall be effective as of the Effective Date and unless terminated earlier pursuant to Sections 8.2 or 8.3 below, this Agreement shall
continue in effect until the end of the Initial Research Program Term. Upon expiration of this Agreement, MERCK’s licenses pursuant to Section 3.1(b) and RENOVIS’ licenses pursuant to Section 3.1(c) shall become fully paid-up, perpetual
licenses. For the avoidance of doubt, RENOVIS’ license pursuant to Section 3.1(a) shall terminate. 
  

	 	8.2	Termination by MERCK or RENOVIS 

  
 Notwithstanding anything contained herein to the contrary, either Party shall have the right to terminate this Agreement at any time in its sole
discretion by giving ninety (90) days’ advance written notice to the other Party. In the event of termination, as set forth in this Section 8.2, then (i) not later than thirty (30) days after the date of such termination, each Party shall
return or cause to be returned to the other Party all Information received from the other Party and all copies thereof, except that each Party may retain one copy in its confidential files for records purposes; (ii) except for the surviving
provisions set forth in Section 8.4 hereof, the rights and obligations of the Parties, including all license rights granted hereunder, shall terminate as of the date of such termination; provided, however, that in the event MERCK is
the terminating party under this Section 8.2, MERCK shall reimburse RENOVIS for its reasonable direct costs incurred in performing the Initial Research Program, provided RENOVIS has fulfilled its obligations under Section 2.6 of this Agreement and
MERCK has had the opportunity to audit RENOVIS’ records in order to verify the accuracy of such costs and such costs have been so verified. 
  

	 	8.3	Other Termination Events 

  

	 	8.3.1	Cause for Termination. This Agreement may be terminated at any time during the term of this Agreement: 

  

	 	(a)	upon written notice by either Party if the other Party is in breach of its material obligations hereunder by causes and reasons within its control and has not cured such
breach within ninety (90) days after notice requesting cure of the breach; provided, however, in the event of a good faith dispute with respect to the existence of a material breach, the ninety (90) day cure period shall be tolled
until such time as the dispute is resolved pursuant to Section 9.6 hereof; 

  

 21 

	 	(b)	by either Party upon the filing or institution of bankruptcy, reorganization, liquidation or receivership proceedings, or upon an assignment of a substantial portion of the
assets for the benefit of creditors by the other Party; provided, however, in the case of any involuntary bankruptcy proceeding such right to terminate shall only become effective if the Party consents to the involuntary bankruptcy or
such proceeding is not dismissed within ninety (90) days after the filing thereof. 

  

	 	(c)	immediately upon written notice by MERCK, in the event of a “Change of Control” of RENOVIS, subject to the provisions of Section 8.3.2(d) of this Agreement. [*].

  

	 	(d)	immediately upon written notice by either Party in the event(s) set forth in Sections 5.2(b), 5.3(b) or 5.4 have occurred. 

  

	 	8.3.2	Effect of Termination on License 

  

	 	(a)	If MERCK terminates this Agreement under Sections 8.3.1(a), MERCK’s licenses pursuant to Section 3.1 shall become fully paid-up, perpetual licenses, RENOVIS’
licenses shall terminate and RENOVIS shall, within thirty (30) days after such termination return or cause to be returned to MERCK all Research Compounds, MERCK Information, and all substances or compositions delivered or provided by MERCK, as well
as any other material provided by MERCK in any medium. If RENOVIS terminates this Agreement under Section 8.3.1(a), MERCK’s licenses pursuant to Sections 3.1 shall terminate as of such termination date; RENOVIS’ licenses pursuant to
Section 3.1 shall become fully paid-up, perpetual licenses; and MERCK shall, within thirty (30) days after such termination, return or cause to be returned to RENOVIS all RENOVIS Information in tangible form and substances or compositions delivered
or provided by RENOVIS, as well as any other material provided by RENOVIS in any medium. 

  

	 	(b)	Upon termination of this Agreement by either Party under Section 8.3.1(d), RENOVIS’ licenses under Section 3.1(c) and MERCK’s licenses under Section 3.1(b) shall
become fully paid-up, perpetual licenses and RENOVIS’ license under 3.1(a) shall terminate as of such termination date. Upon such termination, each Party shall, within thirty (30) days of such termination, return or cause to be returned to the
other Party that Party’s Information, substances or compositions, as well as any other material provided in any medium. 

  

 22 

	 	(c)	If this Agreement is terminated by MERCK pursuant to Section 8.3.1(b) due to the rejection of this Agreement by or on behalf of RENOVIS under Section 365 of the United States
Bankruptcy Code (the “Code”), all licenses and rights to licenses granted under or pursuant to this Agreement by RENOVIS to MERCK are, and shall otherwise be deemed to be, for purposes of Section 365(n) of the Code, licenses of rights to
“intellectual property” as defined under Section 101(35A) of the Code. The Parties agree that MERCK, as a licensee of such rights under this Agreement, shall retain and may fully exercise all of its rights and elections under the Code, and
that upon commencement of a bankruptcy proceeding by or against RENOVIS under the Code, MERCK shall be entitled to a complete duplicate of or complete access to (as MERCK deems appropriate), any such intellectual property and all embodiments of such
intellectual property, subject to applicable law. Such intellectual property and all embodiments thereof shall be promptly delivered to MERCK (i) upon any such commencement of a bankruptcy proceeding upon written request therefore by MERCK, unless
RENOVIS elects to continue to perform all of its obligations under this Agreement or (ii) if not delivered under (i) above, upon the rejection of this Agreement by or on behalf of RENOVIS upon written request therefore by MERCK.

  
 The foregoing provisions of Subsection Error!
Reference source not found.(c) are without prejudice to any rights MERCK may have arising under the Code or other applicable law. 
  

	 	(d)	In the event RENOVIS undergoes a Change of Control as set forth in Section 8.3.1(c) of this Agreement, and MERCK terminates this Agreement pursuant to Section 8.3.1(c),
MERCK’s and RENOVIS’ licenses pursuant to Section 3.1 shall terminate and each party shall, within thirty (30) days of such termination return or cause to be returned to the other party that party’s Information, substances or
compositions, as well as any other material provided in any medium. 

  

	 	8.4	Effect of Expiration or Termination; Survival 

  
 Expiration or termination of the Agreement shall not relieve the Parties of any obligation accruing prior to such expiration or termination. Any
expiration or termination of this Agreement shall be without prejudice to the rights of either Party against the other accrued or accruing under this Agreement prior to expiration or termination. The provisions of Article 4 shall survive the
expiration or termination of the Agreement and shall continue in effect for ten (10) years. In addition, the provisions of Articles 1, 4, 7, 8.3.2, 8.4, 9.4, 9.5 and 9.6 shall survive any expiration or termination of this Agreement. 
  

 23 

	9.	MISCELLANEOUS 

  

	 	9.1	Force Majeure 

  
 Neither Party shall be held liable to the other Party nor be deemed to have defaulted under or breached the Agreement for failure or delay in performing
any obligation under the Agreement when such failure or delay is caused by or results from causes beyond the reasonable control of the affected Party including, but not limited to, embargoes, war, acts of war (whether war be declared or not),
insurrections, riots, civil commotions, strikes, lockouts or other labor disturbances, fire, floods, or other acts of God, or acts, omissions or delays in acting by any governmental authority or the other Party. The affected Party shall notify the
other Party of such force majeure circumstances as soon as reasonably practical, and shall promptly undertake all reasonable efforts necessary to cure such force majeure circumstances. 
  

	 	9.2	Assignment 

  
 Except as provided in this Section 9.2, this Agreement may not be assigned or otherwise transferred, nor may any right or obligation hereunder be
assigned or transferred, by either Party without the consent of the other Party; provided, however, that MERCK may, without such consent, assign the Agreement and its rights and obligations hereunder to an Affiliate or in connection
with the transfer or sale of all or substantially all of its assets related to the Research Compound, [*]or the business, or in the event of its merger or consolidation or change in control or similar transaction. Any attempted assignment not in
accordance with this Section 9.2 shall be void. Any permitted assignee shall assume all assigned obligations of its assignor under the Agreement. 
  

	 	9.3	Severability 

  
 If any one or more of the provisions contained in this Agreement is held invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not in any way be affected or impaired thereby, unless the absence of the invalidated provision(s) adversely affects the substantive rights of the Parties. The Parties shall in such
an instance use their best efforts to replace the invalid, illegal or unenforceable provision(s) with valid, legal and enforceable provision(s) which, insofar as practical, implement the purposes of this Agreement. 
  

 24 

	 	9.4	Notices 

  
 All notices which are required or permitted hereunder shall be in writing and sufficient if delivered personally, sent by facsimile (and promptly
confirmed by personal delivery, registered or certified mail or overnight courier), sent by nationally-recognized overnight courier or sent by registered or certified mail, postage prepaid, return receipt requested, addressed as follows: 

 

	 if to RENOVIS:
	  	 Renovis, Inc.
 270 Littlefield
Avenue
 San Francisco, CA 94080-6924

		
	 	  	 Attn: Chief Executive Officer
 Facsimile No: 650-266-1515

		
	 and:
	  	 Attn: Office of Counsel
 Facsimile No.: 650-266-1405

		
	 if to MERCK:  
	  	 Merck & Co., Inc.
 One Merck Drive (WS
3A-65)
 Whitehouse Station, NJ 08889-0100
 Attn: Office of
the Secretary
 Facsimile No: 908-735-1246

		
	 and
	  	 Merck & Co., Inc.
 One Merck Drive (WS
2A-30)
 Whitehouse Station, NJ 08889-0100
 Attn: Chief
Licensing Officer
 Facsimile No: 908-735-1214

  
 or to such other
address as the Party to whom notice is to be given may have furnished to the other Party in writing in accordance herewith. Any such notice shall be deemed to have been given: (a) when delivered if personally delivered or sent by facsimile on a
business day; (b) on the business day after dispatch if sent by nationally-recognized overnight courier; and/or (c) on the fifth business day following the date of mailing if sent by mail. 
  

	 	9.5	Applicable Law 

  
 The Agreement shall be governed by and construed in accordance with the laws of the State of New York and the patent laws of the United States without
reference to any rules of conflict of laws or renvoi. 
  

 25 

	 	9.6	Dispute Resolution 

  

	 	9.6.1	The Parties shall negotiate in good faith and use reasonable efforts to settle any dispute, controversy or claim arising from or related to this Agreement or the breach
thereof. If the Parties do not fully settle, and a Party wishes to pursue the matter, each such dispute, controversy or claim that is not an “Excluded Claim” shall be finally resolved by binding arbitration in accordance with the
Commercial Arbitration Rules and Supplementary Procedures for Large Complex Disputes of the American Arbitration Association (“AAA”), and judgment on the arbitration award may be entered in any court having jurisdiction thereof.

  

	 	9.6.2	The arbitration shall be conducted by a panel of three persons experienced in the pharmaceutical business: within 30 days after initiation of arbitration, each Party shall
select one person to act as arbitrator and the two Party-selected arbitrators shall select a third arbitrator within 30 days of their appointment. If the arbitrators selected by the Parties are unable or fail to agree upon the third arbitrator, the
third arbitrator shall be appointed by the AAA. The place of arbitration shall be New York, New York, and all proceedings and communications shall be in English. 

  

	 	9.6.3	Either Party may apply to the arbitrators for interim injunctive relief until the arbitration award is rendered or the controversy is otherwise resolved. Either Party also
may, without waiving any remedy under this Agreement, seek from any court having jurisdiction any injunctive or provisional relief necessary to protect the rights or property of that Party pending the arbitration award. The arbitrators shall have no
authority to award punitive or any other type of damages not measured by a Party’s compensatory damages. Each Party shall bear its own costs and expenses and attorneys’ fees and an equal share of the arbitrators’ and any
administrative fees of arbitration. 

  

	 	9.6.4	Except to the extent necessary to confirm an award or as may be required by law, neither a Party nor an arbitrator may disclose the existence, content, or results of an
arbitration without the prior written consent of both Parties. In no event shall an arbitration be initiated after the date when commencement of a legal or equitable proceeding based on the dispute, controversy or claim would be barred by the
applicable New York statute of limitations. 

  

	 	9.6.5	 The parties agree that, in the event of a dispute over the nature or quality of performance under this Agreement, neither party may terminate the Agreement
until final resolution of the dispute through arbitration or 

  

 26 

	 	 
other judicial determination. The parties further agree that any payments made pursuant to this Agreement pending resolution of the dispute shall be refunded
if an arbitrator or court determines that such payments are not due. 

  

	 	9.6.6	As used in this Section, the term “Excluded Claim” shall mean a dispute, controversy or claim that concerns (a) the validity or infringement of a patent,
trademark or copyright; or (b) any antitrust, anti-monopoly or competition law or regulation, whether or not statutory. 

  

	 	9.7	Entire Agreement; Amendments 

  
 The Agreement contains the entire understanding of the Parties with respect to the Research Program and licenses granted hereunder. All express or
implied agreements and understandings, either oral or written, with regard to the Research Program and the licenses granted hereunder are superseded by the terms of this Agreement. The Agreement may be amended, or any term hereof modified, only by a
written instrument duly executed by authorized representatives of both Parties hereto. 
  

	 	9.8	Headings 

  
 The captions to the several Articles and Sections hereof are not a part of the Agreement, but are merely for convenience to assist in locating and
reading the several Articles and Sections hereof. 
  

	 	9.9	Independent Contractors 

  
 It is expressly agreed that RENOVIS and MERCK shall be independent contractors and that the relationship between the two Parties shall not constitute a
partnership, joint venture or agency. Neither RENOVIS nor MERCK shall have the authority to make any statements, representations or commitments of any kind, or to take any action, which shall be binding on the other Party, without the prior written
consent of the other Party. 
  

	 	9.10	Waiver 

  
 The waiver by either Party hereto of any right hereunder, or the failure of the other Party to perform, or a breach by the other Party, shall not be
deemed a waiver of any other right hereunder or of any other breach or failure by such other Party whether of a similar nature or otherwise. 
  

 27 

	 	9.11	Cumulative Remedies 

  
 No remedy referred to in this Agreement is intended to be exclusive, but each shall be cumulative and in addition to any other remedy referred to in this
Agreement or otherwise available under law. 
  

	 	9.12	Waiver of Rule of Construction 

  
 Each Party has had the opportunity to consult with counsel in connection with the review, drafting and negotiation of this Agreement. Accordingly, the
rule of construction that any ambiguity in this Agreement shall be construed against the drafting Party shall not apply. 
  

	 	9.13	Counterparts 

  
 The Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and
the same instrument. 
  

 28 

 IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date first set forth above.

  

	 	 	MERCK & CO., INC.	 	 	 	 	 	RENOVIS, INC.
					
	By:	 	 /s/    Illegible

	 	 	 	By:	 	 /s/    COREY S.
GOODMAN        

	 	 	 Name:
	 	 	 	 	 	 Name: Corey S. Goodman

	 	 	 Title:
	 	 	 	 	 	 Title: President and Chief Executive Officer

					
	 	 	  

	 	 	 	 	 	                 7/15/03

	 	 	 Date
	 	 	 	 	 	 Date

  

 29 

 SCHEDULE 1.12 
  
 Merck Patent Rights 
  
 [*] 
  

 SCHEDULE 1.20 
  
 Renovis Patent Rights 
  

[*] 
  

 SCHEDULE 2.1 
  
 Initial Research Program 
  
 [*] 
  
  

 SCHEDULE 5.1 
  
 Criteria to Determine Preclinical Proof of Concept 
  
 [*]

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